Chief executives and insiders in the US have sold an average of US$600 million (AU$886 million) worth of stock per day this month, new research shows.
TrimTabs Investment Research, which tracks stock market liquidity, has found the leaders of Corporate America have been cashing in their chips as they believe the bull market has run its course.
Their research showed August is on track to be the fifth month of the year in which insider selling tops US$10 billion – and the only other time this has happened was in 2006 and 2007.
TrimTab’s analyst, Winston Chua, told CNN that investors often viewed insider buying and selling as a signal of confidence, and this behaviour definitely indicates a “lack of confidence”.
What’s happening in Australia?
US President Donald Trump sent out six tweets on Saturday that wiped out a whopping $744 billion of value from American markets, prompting huge losses in Australia too.
Yesterday the Australian share market opened 1.66 per cent lower, which equated to around $30 billion of value lost.
The ASX200 sunk a huge 108.5 points upon opening of the market, and while every sector opened in the red, energy and tech shares were especially hammered.
Wall Street experienced gains overnight prompting the ASX to open higher today, with the tech sector experiencing the highest climb.
The stock tumble of the last few weeks and the inverted US yield curve, a general indicator of whether a recession is on the horizon, has made many Aussies turn their heads.
But many experts say there’s nothing to fear.
Economist Shane Oliver told Yahoo Finance share market corrections are normal, and while it’s a risk environment, it doesn’t necessarily mean Australia is headed for a recession.
But the consequences of Trump’s actions have seen Aussies hope for his failure at the next election.
According to new research led by the University of Sydney-based US Studies Centre, more than four in five Aussies hope Trump doesn’t secure a second four-year term in the White House.
“Young or old, Labor or coalition, a Democratic win always appears to be the preferred option for most Australians,” US Studies Centre lecturer Dr Shaun Ratcliff said in a statement on Tuesday.
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