Institution: Australia’s budget appears unfavorable for consumption

A positive factor is the moderate tax relief. However, analyst Michael Simotas stated that adjustments to negative gearing and capital gains tax may drag down the wealth effect brought by housing value. He pointed out that the baby boomer generation, which usually shows strong demand, is particularly affected. Jefferies stated: "Due to reduced investment in existing homes, housing turnover may slow down, which will also have a negative impact on real estate-exposed stocks including JB Hi-Fi, Harvey Norman, Nick Scali, Metcash and Wesfarmers." Nevertheless, this may encourage the construction of new or completed projects, which have been lagging behind approvals for some time. Jefferies stated that this trend may become a favorable factor for Wesfarmers and Metcash to offset the negative impact.