The US market really got worried by the oil rally, and Bernanke's comments were exaggerated to good effect by the bears. The Australian market has been immediately marked lower in typical follow the leader fashion out of New York. As we approach what was our 'worst case' scenario near ASXSP200 4,785, think opportunity.

The previous rally to US$148 was a significant oil price shock, yet businesses the world over, including the US, found ways to deal with it, and adjust. This time round, notwithstanding the immediate sharp rally, the climb to US$145 will be relatively steady, providing ample opportunity for business and consumers alike to plan for, and find ways round, the higher oil impost.

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Clifford Bennett
Herston Economics

ABN Newswire
Tel: +61-2-9247-4344

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