Supposedly the economy is in the doldrums and we're looking at lower interest rates as early as next week.
You wouldn't know that if you were an investor in these household names however, with one cracking a five-year high today, another at a 10-year high, and a third at its highest point ever since listing back in the 90s.
Here's what you need to know:
Harvey Norman Holdings Limited (ASX: HVN) – last traded at $3.95, up 39% for the year
Harvey Norman has hit a five-year high today with a combination of factors such as recent strong sales, low interest rates, and low petrol prices thought to be fuelling the rise.
Sales in all of Harvey Norman's overseas markets rose very strongly in the first quarter of 2015, with a falling Australian dollar adding a thick layer of cream to the top.
Combined with this is the fact that low interest rates and sharply lower petrol prices are thought to be leaving more money in the pockets of consumers, which the market expects will lead to subsequent strong sales quarters throughout the year.
While I don't think low petrol prices are a compelling reason to invest in a company, there's no denying that these multiple factors have forced a sharp re-think of Harvey Norman's share price.
Telstra Corporation Ltd (ASX: TLS) – last traded at $6.56, up 26% for the year
Low interest rates combined with Telstra's recent pile of acquisitions have driven the company to a 10-year high, leaving shareholders likely rubbing their hands together gleefully over the 10% the company has risen in January alone.
Despite the strong price movement and high demand for the company's dividends in a low interest rate environment, it remains to be seen if Telstra's rising price is adequately supported by its underlying business.
Commonwealth Bank of Australia (ASX: CBA) – last traded at $89.73, up 20% for the year
Commbank continues to defy gravity, cracking the $90 mark for the first time ever in trade early this morning.
As fellow contributor Ryan Newman noted in his article, the company continues to look substantially overvalued and could be in for a rapid re-rating once interest rates rise and bad debt charges come creeping back onto the balance sheet.
That's not going to happen any time soon though, so the market's love affair with Commonwealth Bank of Australia looks set to continue for the time being.
