News & Insights
Here you’ll find our thinking and helpful insights on the latest developments in domestic and global markets.
Investment and Economic Snapshot April 2023
Global financial markets finished the month on a positive note. European bourses were at the forefront of the global equity rally with UK and Euro Area equities boosted by strong gains in their currencies versus the US Dollar. Meanwhile, Chinese investable and domestic stocks were in the red, dragging down the emerging markets equity benchmark. Within the commodity complex, the prices of both gold and oil ended the month marginally higher. However, most of the gains occurred in the first half of the month – on the back of the surprise OPEC production cuts. Iron ore - which is especially sensitive to Chinese industrial activity - was the main underperformer in April.
Global Market Wrap - March 2023
March was dominated by the collapse of Silicon Valley Bank, followed in quick succession by the collapse of Signature Bank and then Credit Suisse. Markets initially fell in response to this news, but quickly recovered once it became clear this wasn’t a systemic credit problem in the global economy. Towards the end of the month, the market rallied close to 6%, and for March overall global equities rose 3.2%.
Watch time: 2:58 mins
Investment and Economic Snapshot March 2023
The collapse of US regional banks Silicon Valley Bank, Signature Bank, and European heavyweight, Credit Suisse, dominated the headlines this month, sending shockwaves through financial markets fearful that many more bank failures could follow.
Markets fell in response before staging a sharp recovery late in the month once it became clearer that the situation was contained.
Global Market Wrap - February 2023
February was a weaker month for equity markets, with inflation, geopolitical tensions and China all adding pressure to markets.
This month also saw earnings season conclude in the US and Europe. For Europe, it was a better than anticipated profits result season. However, the US saw earnings contract for the fourth quarter, with a number of US companies delivering their worst quarterly earnings results since the fourth quarter of 2009 in the GFC.
Most sectors and regions fell this month, with the market starting to get signs that China’s reacceleration and growth might not be as fast as expected. As a result, commodity prices were weaker this month.
Watch time: 2.58 mins
Investment and Economic Snapshot February 2023
In stark contrast to January’s positive start to the year, February proved to be a stern reminder that the current bear market may have further to run. Over the past few weeks, global bond yields have risen materially, amid concerns that better than expected economic data raises the risk that central banks will need to respond more forcefully with higher interest rates to keep elevated inflation at bay.
Investment and Economic Snapshot January 2023
The year kicked off in fine form, with all major market indices posting above-average returns this month. News that inflationary pressures were starting to wane in the US caught the attention of investors, triggering strong, speculative buying, with continued high hopes that central banks are nearing the end of their tightening cycles.
Investment and Economic Snapshot 2022 In Review
2022 was an extremely challenging and highly unusual year, with investors experiencing the longest bear market since the Global Financial Crisis. What made 2022 so unique was the fact that both global stocks and bonds fell by more than 10% after coming into the year with promising prospects.
Today, we view 2023 as a year when inflation will subside as monetary tightening runs it course and supply constraints ease from the pandemic. However, recent data suggests that it may still take a further 6-12 months before inflation is back to a level of 4%. The move from 4% to 2%, which many central banks are still targeting, will take longer as the labour market remains strong and shelter/rental inflation remains sticky.
Download our 2022 In Review to take a look back over the year that was in financial markets, and to read our outlook for 2023.
Global Market Wrap - November 2022
November was a positive month for investors with the global equity index rallying strongly into the month's end.
Inflation remained a key talking point this month, with evidence that the economy is beginning to weaken due to numerous layoffs from large companies. Retailers are also starting to see a meaningful slowdown in spending. For investors, this means that the economic weakness that central banks are trying to engineer might finally be coming to fruition and rate hikes may soon slow down.
The announcement this month that tough COVID restrictions in China may be easing markedly improved sentiment in the region and buoyed the Chinese share market as a result.
Watch time: 4.01 mins
Investment and Economic Snapshot November 2022
The past couple of months have been much better than expected for equity and bond markets despite deteriorating demand conditions both domestically and globally. The ASX continued its golden run, posting +6.4% for the month and an impressive +3.0% for the year.
Global Market Wrap - October 2022
This October marked the best month for the Dow Jones since 1976. Global shares were also up 6% this month. Inflation, third quarter earnings and China's National Congress were the three key themes to hold investors' attention this month.
Most sectors were higher this month with energy and the industrials being the notable outperformers during October. While most regions also rose, notably Asia was the only region to fall. This was driven by the region around China with China, Hong Kong and Taiwan the notable underperformers – those countries most affected from China’s National Congress.
Watch time: 3.10 mins
Investment and Economic Snaphot October 2022
Most global financial assets rebounded this month following a sustained period of mediocre performance over August and September.
Global sovereign bonds posted a small gain in October following a gradual decline in real yields as the month progressed.
The Reserve Bank of Australia surprised markets with a less-than-expected 25bp rate hike. Australia was also the first among developed
market economies to slow its pace of hikes despite elevated inflation.
Global Market Wrap - September 2022
Global shares were down 10% in September - the worst month for global equities since March 2020.
All sectors and regions declined this month. However, it was healthcare and consumer staples that performed the best given they are more defensive sectors. Latin America was a notable outperformer, despite still declining.
Yet again, inflation was at the forefront of investors minds in September. Also grabbing headlines was the UK’s Mini-Budget.
October will see the commencement of the US third quarter earning season, which will provide a good sign of the health of the economy and companies, and whether we will start to see the impact of higher interest rates on company margins.
Watch time: 2.33 mins
Investment and Economic Snapshot September 2022
All major financial markets except for the US dollar went into rapid retreat last month. Global and US fixed-income markets posted poor returns as central banks continued to fight fire with fire with outsized interest rate hikes.
Meanwhile, global manufacturing activity continued to deteriorate adding to the weight of evidence that the global economy is struggling and running head-first into a recession.
Global Market Wrap - August 2022
August was a weaker month for global equities with markets falling around 3.6%.
Once again this month, investors were focused on inflation and interest rates. From his speech at the Jackson Hole Economic Symposium (the Fed Reserve’s annual gathering of central bankers), US Fed Reserve Chair Jerome Powell made it clear that inflation has not yet peaked. As a result, interest rates moved higher, and equity markets declined towards the end of the month.
Watch time: 3.40mins
Investment and Economic Snaphot August 2022
A brief rally kicked off the month as evidence of easing price pressures and deteriorating demand conditions led investors to speculate that the Federal Reserve will be forced to abandon its hawkish stance. However, all bets of a ‘Fed pivot’ were abruptly put to bed and the market was given a reality check following Federal Reserve Chair Powell’s speech at ‘Jackson Hole’ where he reiterated that the Fed remains doggedly determined to bring inflation under control, even at the price of the economy slowing significantly.
Global Market Wrap - July 2022
In terms of global equities, July was a strong month for investors. However, the focus remains on interest rates and potential recessions.
In the US, the news from earnings season was generally upbeat, however a number of consistent themes arose, including continued supply chain issues, higher interest rates and potential recessions. As a result, more companies announced hiring freezes and plans to downsize. Companies also reported changes in the spending patterns and behaviours of households and corporates. These are early indicators that interest rate hikes are impacting companies and their operations, resulting in the desired outcome of reducing demand.
Watch time: 3.50mins
Investment and Economic Snapshot July 2022
The month of July saw financial markets roar back to life following a terrible June and end of the financial year. However, the outlook for global growth continues to be challenged. Much depends on whether inflation can be brought to heel and if not, to what extent central bankers will go to bring it under control without breaking the economy in the process.
Investment and Economic Snapshot - FY2021/2022 in Review
FY2021/2022 was an extraordinary 12 months from both an economic and financial market perspective. While the six month period ending the calendar year 2021 showed positive signs, the second half of the financial year 2021/22 was arguably one of the worst periods we have experienced in many years for investors.
Investment and Economic Snapshot May 2022
The performance of global financial markets showed some improvement in May, with global equities, US equities, and emerging markets all generating small positive returns.
Global Market Wrap - April 2022
Global equities fell close to 9% in April and 13% YTD. The topic of inflation continues to dominate headlines, and while there was some indication that it had started to peak, the combination of the sustained war in Ukraine and China’s lockdowns are starting to create concerns that inflation might be "stickier" and run longer than expected.
This month, more “defensive” sectors performed well, with consumer staples and utilities among some of the best performing sectors.
Inflation and the risk of recession drove the markets in April, and that will continue to be the focus for investors going forward.
Watch time: 4:35mins