Key points After strong share market gains in the March quarter, a correction or rough patch was inevitable and we now may have entered just that, particularly with the eurozone debt crisis making a bit of a comeback. Spain and Italy certainly remain high risk and further volatility is likely. However, better share valuations, easier […]

Headline developments of the past week The past week has seen a swing to ‘risk off’ with shares, commodities and growth currencies like the Australian dollar all weak on worries about Spain and China and fears of no more QE3 in the US. After a strong March quarter, some sort of consolidation or correction is […]

Headline developments of the past week Eurozone finance ministers look likely to agree to increase Europe’s debt firewall to around €940 billion by combining the €500 billion in the European Stability Mechanism that will commence from mid year with the €440 billion in the existing European Financial Stability Facility (EFSF) bailout fund. Given that €200 […]

Key points Australian pension funds tend to have a relatively high exposure to shares and lower allocation to bonds. This reflects a range of factors including the relatively strong performance of Australian shares, tax, demographics and the small Australian corporate bond market. The share allocation may fall a bit over time, but now is not […]

Headline developments of the past week The past week saw investor caution return on the back of soft economic data and renewed worries about China and Europe. This saw shares, commodity prices and the Australian dollar fall and sovereign bonds in major countries rally.  Chinese related news added to nervousness about a hard landing there, […]

Key points The last two years have seen a solid start for shares give way around May to worries about a double dip back into global recession and 15 per cent plus falls in share markets. Could the same happen this year? Risks clearly remain, but there is also a good chance that after two […]

Headline developments of the past week The past week saw a distinct contrast between strong US economic data and a more optimistic Fed driving US shares and most global share markets higher, but comments from Chinese Premier Wen Jiabao dampening expectations of policy easing in China which weighed on Chinese shares, commodity prices and the […]

Key points While it’s too early to call the end of the secular bear market in US shares, there are some signs of light in the US economy, notably in manufacturing, energy production and housing. In particular, after triggering the GFC, the US housing slump appears to be over with a recovery in prospect. This […]

Headline developments of the past week The past week saw a bit of volatility return to risk trades early in the week on worries that China’s 7.5 per cent growth target for this year is too low, uncertainty about Greece’s bond swap and news Brazilian GDP growth had slowed to 1.4 per cent last year. […]

Key points The December half profit-reporting season was pretty lacklustre with essentially flat profits. Profit growth is likely to pick-up in the year ahead but still lag consensus expectations for double-digit growth. Australian shares are likely to rise over the year ahead as valuations are attractive and global shares are likely to rise, but are […]

Headline developments of the past week The news on the European debt crisis was mostly positive with the ECB providing another €529.5bn in cheap three-year funding to banks. After allowing for rollovers of existing borrowing, this implies a net €300bn in new liquidity being pumped into the European banking system. While it may not be […]

Key points World oil prices have been pushed higher by worries about Iran on the back of strong long-term demand growth from the emerging world and increased confidence regarding the global outlook. Current oil price levels are probably not a big threat to growth, but a continuing rise would be. Current oil prices imply further […]