What Worked Australia - 20 May 2016 - Momentum reversal continues, bringing value along for the ride

What Worked – The reversal in short term momentum continued this week, albeit in a much more violent fashion than the last month. The main difference this week – long term momentum also saw a sell-off, and that saw value come off as well. While momentum continues to revert, the market as a whole has managed to remain buoyant, helped in large part by positive performance from the more sizeable end of the market. Origin Energy (ORG, +5.1%), Worleyparsons (WOR, +4.0%) and Santos Ltd (STO, +4.1%) just some of the 1 Year losers that saw a bounce this week, while Regis Resources (RRL, -6.6%) and Northern Star Resources (-8.2%) saw the other side of that coin and were off strongly.

Amongst the cheapest names in the market, Seven West Media (SWM, -9.7%), Spotless Group (SPO, -2.6%) and Evolution Mining (EVN, -7.9%) became even cheaper on forward PER basis, while Dominos Pizza (DMP, +3.5%), Sydney Airport (SYD, +1.7%) and Oil Search (OSH, +2.0%) all finished up becoming even more expensive.

Who Moved – 12 names managed to post higher than normal volumes this week,  with Bluescope Steel (BSL, +4.4%), Dexus Property Group (DXS, +2.9%) and Spark New Zealand (SPK, +2.4%) all finishing up on good volume, while IOOF Holdings (IFL, -8.9%), Ainsworth Game Tech (AGI, -5.3%) and AusNet Services (AST, -5.0%) all finished down supported by heavy volume.


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