Are the troubles in Turkey easing? Investors may be eyeing off value in emerging markets after the recent sell-off triggered by concerns about the Turkish economy. Emerging market (EM) shares in local currency terms are down around 14% from their January high, and emerging market currencies are down 16% since their February high. Emerging markets are now trading on a forward PE of around 11 times, making them quite cheap, as are their currencies. …
Weekly Market Update 14 September 2018 Investment markets and key developments over the past week The past week saw most share markets rise helped by good economic data, talk of another round of US/China trade talks and a bounce in emerging market shares after Turkey raised interest rates. However, while US, Eurozone and Japanese shares saw strong gains, Australian shares only rose marginally, and Chinese shares remained under pressure. Bond yields mostly rose. Commodity prices …
Seven lessons from the Global Financial Crisis for investors Key points The key lessons for investors from the Global Financial Crisis (GFC) are that: there is always a cycle; while each cycle is different, markets are pushed to extremes of valuation and sentiment; high returns come with higher risk; be sceptical of financial engineering or hard-to-understand products; avoid too much gearing or gearing of the wrong sort; the importance of proper diversification; and the importance …
Weekly Market Update 7 September 2018 Investment markets and key developments over the past week The past week saw share markets fall on the back of worries around emerging markets, trade wars and the potential regulation of US social media stocks. After being resilient to global threats over the last few months Australian shares also got hit and fell 3.1% to their lowest since June. Bond yields were generally little changed although they fell in Italy. …
What’s next for house prices? The bottom line is we see more downside in Australian house prices. That is, of course, a broad generalisation and it depends on where you live. Australian house prices have fallen for ten consecutive months driven mainly by declines in Sydney and Melbourne, which are coming off the back of a huge boom. Nationwide, there is likely more downside to go with expectations of another 5% decline. We’ve seen a …
Five things you need to know about the Australian economy Key points The Australian economy grew solidly over the last year. While recession remains very unlikely, the combination of a slowing housing cycle, constraints on consumer spending and still subdued business investment will likely see growth slow going forward to around 2.5-3%. As a result, spare capacity is likely to remain significant, keeping wages growth and inflation low. We don’t expect the …
Weekly Market Update 31 August 2018 Investment markets and key developments over the past week The past week saw most share markets rise helped by US shares pushing further into record territory, but gains were capped by ongoing turmoil in the emerging world (notably Argentina and Turkey) and nervousness ahead of the next round of US tariffs on imports from China. Australian shares also rebounded after being hit by the previous week’s political turmoil. Bond yields …
Investment returns over the next five years are likely to slow Key points The continuing slide in investment yields across most major asset classes points to a constrained medium-term return outlook. For a diversified mix of assets, this has now fallen to around 6.2% on our projections. The key for investors is to have realistic return expectations; allow that inflation is also low so real returns aren’t down as much; and focus on …
US reporting season and the tech sector AMP Capital chief economist Shane Oliver says revenue disappointments and slowing user growth at technology giants Facebook and Twitter is a warning that the US tech sector could at some stage underperform – or even suffer a serious correction. “What those disappointments tell us is there is a limit to the take up of social media,” he says. “At some point it will start to slow down.” …
Weekly Market Update 24 August 2018 Investment markets and key developments over the past week The past week saw most global share markets rise as Turkey slipped out of the headlines, but Australian shares were hit by political uncertainty. Bond yields fell a bit in the US and Australia, were unchanged in Japan and were up a bit in Germany. Oil and metal prices rose but the iron ore price slipped. While the US dollar slipped …
