After touching five-and-a-half year highs just over a week ago, the Australian market finished last week on a five-week low.
There were some nasty losses, with billions wiped off. But CommSec chief economist Craig James has told the Australian Associated Press last week’s plunge was the result of some healthy profit-taking.
“I think a lot of investors, particularly fund managers with thoughts turning to June 30, are thinking now is the time to take some profits if there is a flatter time or period of weakness ahead,” he told AAP.
While they’ve pulled cash out to have a think about their investment strategies in the short term, James said it was not a major concern for the market.
Last week the ASX200 index fell 76.5 points, or 1.5 per cent, to 4964.3, ending below 5000 points for the first time since April 22.