News & Insights
Here you’ll find our thinking and helpful insights on the latest developments in domestic and global markets.
Global Equities Update – June 2021
In May, the global equities market was higher again, up 1.6% and up 11% for 2021. The market continues to be focused on inflation, with current debate as to whether it will be enduring or transitory. While it is difficult to predict, T. Rowe Price Portfolio Specialist Sam Ruiz, acknowledges that there will be a lot of supply shocks as the world returns to normal and that the pathway remains uncertain.
Watch time: 5:05 mins
Economic Snapshot May 2021
May was a month of consolidation for most asset classes. Global investors have been grappling with the trade-off between the benefits of stronger global growth for corporate profits and the potential cost to bonds from higher inflation that might flow from the stronger growth.
Global Equities Update – May 2021
Reflecting on the previous month, markets performed well again in April – up 4% for the month and 9% YTD. The market is currently focused on those stocks that had tailwinds from COVID – which ones will accelerate and which will decelerate e.g. Netflix. Looking forward, a number of uncertainties still remain as we see a resurgence of the virus in parts of the world and what that means for positioning in developed vs. emerging markets. Will we actually see a synchronised global recovery?
Watch time: 3:26 mins
Global Equities Update – April 2021
T. Rowe Price Portfolio Specialist Sam Ruiz shares with us his views on the market this month and explores the current key themes: inflation, interest rates and predicted US growth.
Watch time: 3:18 mins
Economic Snapshot April 2021
April saw positive returns across the board for financial markets. Equities and commodities performed especially well. Bond markets steadied in April, after their fears in previous months about the risk of inflation stemming from the robust pace of economic recovery. Data showing softer than expected March quarter inflation in Australia helped the local bond market. The better performance of the bond markets provided a good backdrop for equity markets in April. Bond-sensitive equities such as REITs did well, while the broader US equity market was supported by a solid company earnings reporting season. The US equity market reached new highs, but the Japanese market declined as a renewed COVID-19 wave saw the reimposition of lockdowns. The emerging equity markets index rallied, despite the weakness of the Indian equity market which was also caused by COVID-19 developments there.
Economic Snapshot March 2021
March saw further good news about the pace of global economic recovery, with the OECD revising up its forecasts for global growth, and strong employment and growth figures reported in both Australia and the US. Financial markets received the better news on growth with mixed feelings. Their concern is that the US economy will start to overheat sooner than expected, leading to higher inflation and tighter monetary policy.
Global Equities Update - March 2021
T. Rowe Price Portfolio Specialist Sam Ruiz shares with us his current views on the market, and explores the three themes in the market at the moment: earnings, the virus and interest rates.
Watch time: 3:16 mins
Market Watch February 2021
Three major themes to watch this month: inflation, currency, and the speed and success of the COVID-19 vaccine rollout.
Economic Snapshot February 2021
February was a re-run of January in that markets started on a strong note, with equities posting very good gains in the first half of the month, only for conditions to reverse later in the month. However, while online trading caused the volatility in January, it was the bond market that caused the trouble in February.
Economic Snapshot January 2021
January saw further improvement in the Australian economy, with higher employment and stronger business conditions and consumer confidence. Inflation rose only modestly in the December quarter to around1% in annual terms. This is well below there serve Bank’s 2-3% target range. Economic activity in the US and Europe is showing the impact of new lockdowns to curb the spread of the latest strains of COVID-19. There are fears of a double-dip recession in Europe.
Economic Snapshot December YIR 2020
2020 began off the back of a big global equity rally, with a few geo-political concerns, but no inkling of the havoc that COVID-19 was about to wreak on the world. As the March quarter unfolded, with lockdowns following the virus from one country to another, risk assets succahs equities and the A$ fell sharply as expectations of recession spiked. At the sometime, a shortage of US$ liquidity pushed financial markets close to freezing up. Central banks and governments stepped in with massive liquidity and spending packages. Interest rates were cuts to historic lows.
Economic Snapshot November 2020
November was a massive month for global financial markets. Two of the biggest uncertainties facing the markets were resolved in ways which led global investors to become much more bullish about the outlook as we move out of 2020 and into 2021. First, the US election is now out of the way and Joe Biden has beaten Donald Trump for the White House. The markets no longer need to fear a contested election. Second, the news of successful vaccines for COVID-19 marked a sea-change in investor sentiment, even though big waves of the virus are rolling through Europe and the US. These factors, plus the prospect of further policy support, triggered a big risk-on move in financial markets.
Economic Snapshot October 2020
A major resurgence of COVID-19 infections in the UK, Europe and US has renewed investor concerns about the path of global economic recovery. In Europe in particular, there is talk of a double-dip recession. This, plus increasing uncertainty about the US election outcome, and the chances of getting a big new fiscal package through Congress, undermined global equity markets in October.
Economic Snapshot September 2020
September saw a break in the rally in global equity markets. Several factors contributed to this, including signs that the global recovery, while proceeding, is nevertheless slowing down. Growing concerns about prospects for fiscal stimulus in the US added to the volatility, as did reports that Japanese firm Softbank had purchased billions of dollars of equity options, driving tech stocks up on speculative positions.
Economic Snapshot August 2020
August saw restrictions maintained in a number of countries to contain second waves of COVID-19. Progress was made in Australia and the US in reducing infection rates, but the US still has a long way to go before they really get the virus under control. Europe is in the grip of a significant second wave. The most affected countries include Spain and France, both of which now have infection rates exceeding those in their first waves.
Economic Snapshot July 2020
July saw second waves of COVID-19 infections around the world with cases per week in a number of countries, including Australia, the US and Japan, exceeding previous peaks. Some countries have responded by reinstating national restrictions, while others, including Australia, have adopted a regional approach. Employment and consumer confidence are starting to feel the consequences of this, as are budget deficits which will expand even further as more support to firms and households is required to mitigate the impact on labour markets and consumer spending.
Economic Snapshot June 2020
2019/20 was most dramatic year for financial markets since the GFC. The first half of the year was dominated by concerns of global recession as slower growth in China spilled over into the rest of the world. Central banks cut cash rates even further, which encouraged equity markets to rally into December. The ongoing popularity of tech stocks helped underpin the rally. However, equity market valuations closed 2019 in expensive territory.
Economic Snapshot May 2020
Equity markets pushed higher in May, taking valuations to very expensive levels, as markets took an almost exclusively optimistic view of declining infection rates, reports of progress towards a vaccine and the benefits of economies re-opening. In addition, significant stimulus measures announced in previous months began to take effect, giving many investors’ confidence that government policy would provide a safety net against any further falls in markets.
Economic Snapshot April 2020
Markets embraced a risk-on mood in April with a strong rally in equities as investors welcomed declining virus infections and reports of possible medical treatments. Support from governments and central banks also helped. However, as the month went on, the economic data and corporate reporting painted a bleaker picture of just how much damage has been done to the world economy. Markets have priced in a lot of good news and now they are starting to see the bad news. Equity markets are looking expensive again after April’s rally, which does not leave much room for them to absorb bad news.
Economic Snapshot February 2020
The first three weeks of February saw further good performance by global equity markets. The news from China about Covid-19 seemed to be getting better and the latest economic data was still quite positive. However, all this changed very quickly from 21 February when markets suddenly became alarmed by reports of the virus spreading to a number of countries around the world, including Italy, Iran, South Korea and the US.