Financial Planning Latest News & Events

For the latest news and events in the financial planning industry.

September Market Update 2018

The Pulse

  • Trade tensions between the US and China are still a source of significant uncertainty for financial markets.
  • Political risks and trade uncertainty have seen a vicious cycle of selling in emerging market currencies as investors react to contagion fears.
  • US shares rose in August on the back of positive company earnings results, while European economic data was soft.
  • Australia recorded GDP growth of 3.4% year-on-year—the fastest rate since 2012 during the height of the mining boom.
  • On the Brexit front, the biggest stumbling blocks remain the Irish border plan and the UK’s post-exit trade relationship with the EU.

Global economies

Fears of emerging market contagion have so far been confined to currency markets, with major falls in the Turkish lira and Argentine peso. Trade tensions are still a source of uncertainty, especially among US and Asian manufacturers, but so far the impact on the real economy has been muted. The US growth story was strengthened with an upward revision to GDP and strong jobs numbers, while in Europe growth and inflation remain soft.

US

The US economy is growing at a solid rate and employment continues to build, but inflation expectations are still largely unchanged and wage growth, while showing some promising signs, remains stubbornly low despite labour market tightness. Trade tensions between the US and China are causing significant uncertainty for manufacturers, but so far demand is holding up well, as evidenced by August’s expansion in new orders.

Europe

In Europe, economic growth is maintaining momentum but is largely disappointing in absolute terms, while inflation remains weak and is forecast to remain below target over the next three years.

China

China’s headline GDP for the June quarter showed a steady growth rate at 6.7%, but growth in the first half of the year has moderated to 6.4%, with a decline in investment spending being the driving force. The ongoing crackdown on credit growth in the shadow banking sector has been a key factor behind the downturn in investment and the state-owned enterprise sector, while the consumer and services sector has now become the major contributor to growth.

Asia Region

Japanese GDP grew by 0.5% in the June quarter or 1.9% annualised, recovering from a contraction of 0.9% in March. This means the economy has grown by a meagre 1.0% over the year, although conditions appear to be improving, led by solid growth in investment and promising signs in inflation and wage growth.

Australia

Australia’s economic growth was a stronger-than-expected 0.9% for the June quarter and 3.4% year-on-year—the fastest growth since 2012 during the height of the mining boom. Growth was boosted by a 0.7% rise in consumer spending, despite headwinds from low wage growth and falling house prices. The June figures compare favourably to the 2.9% growth for the 2017-18 financial year, as well as the RBA’s estimate of just over 3.0% for 2018 and 2019.

 


 

The information contained in this Market Update is current as at 13/09/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

August Market Update 2018

The Pulse

  • US economic growth shot to an annualised 4.1% in the June quarter but the market is questioning whether this is sustainable.
  • The impact of US and Chinese tariffs has been noticeable in Asian export growth but US manufacturing activity is yet to be hit hard.
  • In Australia, the RBA continues to keep rates on hold with tighter credit conditions and lower house prices constraining the household sector.
  • Japan’s economy likely returned to growth in the June quarter, with wage growth helping to alleviate deflationary pressures.
  • The UK is heading towards a ‘hard’ Brexit, with the EU rejecting Prime Minister May’s proposed customs plan.

Global economies

Uncertainty surrounding the global trade environment and concerns about the sudden rise of protectionist policies remain at the forefront of the economic narrative, but for now equity markets are focused on positive fundamentals. While financial market volatility has been constrained in recent months, there is a risk of higher volatility in the second half of 2018.

US

The US economy continues to power ahead in the face of geopolitical and trade tensions, but it remains to be seen if this is sustainable. US June quarter GDP shot to an annualised 4.1% according to the first estimate reading, which was in line with expectations, but based on factors that could prove temporary, including the impact of income and company tax cuts.

Europe

Despite improved labour market flexibility and ongoing structural reform, the eurozone economy is yet to show signs of sustained growth. According to a preliminary estimate, GDP growth across the euro member countries was 2.1% year-on-year at end June, down from 2.5% in the March quarter and continuing to pull back from the higher rates of growth seen in 2017, which were underpinned by strong export performance.

China

The latest round of Chinese data provides evidence of a further slowing in manufacturing activity, while the services sector is lifting its contribution to growth. The June quarter GDP data showed economic growth easing back to 6.7%, with the services sector growing by 7.6%, highlighting the evolution of the Chinese economy

Asia Region

In Japan, manufacturing and services PMIs indicated a moderate slowing in activity, with the headline Business Activity Index falling 0.1 points to 51.3. Japanese exports rose 6.7% in June, but exports to the United States—Japan’s largest trading partner—fell for the first time in 17 months in signs that the US-China tariff war is starting to have some spillover effects in neighbouring markets.

Australia

Given the risks within the household sector, the RBA is happy to sit on the bench, holding rates at 1.50% at its August meeting. While household debt and sluggish wage growth remain a concern, the business sector is enjoying favourable conditions, especially in the manufacturing, construction and business services industries.

 


 

The information contained in this Market Update is current as at 13/08/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

July Market Update 2018

The Pulse

  • US core consumer prices lifted in line with the Fed’s 2% inflation target, vindicating June’s rate hike.
  • Slowing credit growth and infrastructure spending is pointing to softer Chinese growth for the June quarter.
  • Australia’s labour market continues to tighten, but employment growth and hours worked have lost momentum and wage growth is subdued.
  • US tariffs on US$34 billion worth of Chinese goods came into effect in early July, with China responding in kind with tariffs on key American exports.
  • European political tensions are on the rise, with the UK’s Brexit plan resulting in ministerial resignations and Italy’s budget likely to delay deficit reduction.

Global economies
The synchronised global growth story has found itself under threat from escalating trade tensions, European political risks, and a slowing Chinese economy. These risks emerge in the context of tightening monetary policy globally, as inflation slowly moves higher in line with central bank targets. Despite labour market tightness, wage growth is not yet sustainable and household sectors remain exposed.

US
The US March quarter GDP was lower than previously estimated, weighed down by the weakest consumer spending in almost five years. June’s third estimate reading showed growth at an annual rate of 2.0%, down 0.2 points on the previous estimate. While Trump’s $1.5 trillion tax cuts are expected to provide a boost to consumer spending in the June quarter, the tit-for-tat tariff war with major trading partners—including China, Canada, Mexico and the EU—could prove a drag on growth, putting pressure on supply chains and possibly undercutting business investment.

Europe
Headline inflation in the eurozone rose from 1.9% to 2.0% in June, although this was due mostly to an 8.0% rise in energy prices. Underlying price pressure remains weak, with the core CPI falling from 1.1% to 1.0%.

China
China’s economy continues to show signs of fatigue, with slowing credit growth and infrastructure spending pointing to softer economic growth for the June quarter. June’s official PMI figure showed a further loss of momentum in the manufacturing economy, falling from 51.6 to 51.5, while industrial production also fell 6.9% to 6.8% year-on-year.

Asia Region
Revised GDP data confirmed that the Japanese economy shrank by an annualised 0.6% in the March quarter, putting an end to eight consecutive quarters of growth. This places Japan at risk of a technical recession (defined as two consecutive quarters of negative growth), and while the contraction was caused by temporary factors, a strong rebound appears unlikely.

Australia
Australian economic growth is on a sound footing, supported by a bounce in global growth, a strong commodities sector, and improved business and public sector investment. However, while there has been a surge in employment and hours worked over the past year, momentum has slowed from 2017’s pace, and wage growth remains subdued at around 2.0%.


 

The information contained in this Market Update is current as at 13/07/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

June Market Update 2018

The Pulse

  • Inflation continues to creep higher and is close to or at 2% in major developed markets, although core measures of inflation remain below target.
  • Despite slower-than-expected March-quarter growth in the US, there are signs of a stronger June quarter, including improved consumer spending and business investment.
  • Tariff threats between the US, China and Europe are yet to be resolved and risk escalating into a trade war that could damage global trade.
  • In Italy, the political impasse was finally broken, with a coalition government formed between the two popular right parties, Lega Nord and the Five Star Movement.
  • Japan’s economy contracted in the March quarter, bringing into question the efficacy of the Bank of Japan’s quantitative easing measures.

Global economies

Geopolitical tensions, including an ‘on-again, off-again’ tariff war between the US, China and Europe were the cause of uncertainty for markets through May. The US and China agreed to a ‘trade war hold’ before tariff threats re-emerged once again from the US, culminating in June’s heated G7 meeting. Globally, inflation continues to inch higher, with renewed pressure on central banks to tighten rates, while data points to stronger economic growth for the June quarter.

US

US March quarter GDP was revised down 0.1 points to an annualised 2.2% according to May’s second estimate reading, missing against the expected reading of 2.3%. Despite the slower-than-expected growth, there are signs of a stronger June quarter, including improved consumer spending and business investment.

Europe

Concerns over slowing world trade growth and rising geopolitical tensions, together with extreme weather conditions, have combined to undermine economic activity across the European continent. The spectre of a trade war with the US also places major European economies in an uncertain position.

China

While China’s March quarter GDP growth was a promising 6.8% year-on-year, indicators of manufacturing output growth and business investment remain subdued. China’s official manufacturing PMI rose in May from 51.4 to 51.9, indicating a modest improvement in growth, however the unofficial Caixin PMI, which measures output from smaller firms, was steady at 51.1

Asia Region

June’s flash March quarter GDP reading confirmed that Japan’s longest run of economic expansion since the 1980s has come to an end, with output contracting -0.6%. The result is a serious blow to Prime Minister Abe’s reflationary policies and the Bank of Japan’s ultra-easy monetary policy.

Australia

The Reserve Bank of Australia (RBA) left the cash rate anchored at 1.5% at its June meeting, and judging by the most recent Statement on Monetary Policy, it is unlikely to change course any time soon. Ongoing low wages growth, uncertainty over the extent and impact of the recent tightening in home lending conditions, and inflation barely in the bottom of the RBA’s target range suggest that it would be premature to begin exiting current accommodative policy settings. However, the broader economic picture remains robust.


 

The information contained in this Market Update is current as at 20/06/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

May Market Update 2018

The Pulse

  • The global economy lost some momentum in the March quarter, but fundamentals remain robust.
  • US core inflation measures are rising, which is flowing through to longer-term expectations and pushing yields higher.
  • The threat of a trade war between the US and China continues to be a source of significant uncertainty for markets.
  • Australians will receive cuts to income tax as anticipated, while public infrastructure spending should help bring the economy closer to capacity.
  • Inflation in the euro area remains sluggish, with core inflation falling sharply from 1.0% to 0.7% in April.

Global economies

The March quarter saw some slowing of momentum, partly due to temporary factors but compounded by concerns over a possible trade war between the US and China. Inflation expectations showed signs of firming, pushing yields higher through April, while a narrowing of the LIBOR-OIS spread helped calm the market’s nerves. Fundamentals remain supportive of growth through 2018 and 2019, with inflation expected to rise as labour markets continue to tighten.

US

March quarter growth was an annualised 2.3%, indicating a slowing in activity over the December quarter. Partly weather-affected, consumer spending growth weakened to 1.1%, while manufacturing activity peeled off from extremely high levels. Headlines have been dominated by announcements of further tariffs, raising fears of a trade war, while markets have been watching interbank funding costs for signs of financial system stress.

Europe

Inflation in the euro area remains sluggish, with the CPI falling to 1.2% in April, down from 1.3% in March, while core inflation fell sharply from 1.0% to 0.7%. The ECB still believes inflation will rise to 1.7% by 2020, with oil prices expected to lift the headline rate in coming months.

China

Economic data for the early part of 2018 suggests the economy has slowed marginally after the better than expected growth in 2017. The March quarter GDP may have come in at a steady 6.8%, but PMI indicators of manufacturing activity still appear weak, while investment spending also continues to soften.

Asia Region

Japan’s manufacturing sector expanded at a faster pace in April, with the Nikkei Japan Manufacturing PMI rising from 53.1 to 53.8 amid improved growth rates in output and new orders. The services sector also recorded a boost, rising at the fastest pace in six months, with improved demand allowing service providers to lift prices.

Australia

In a decision that undoubtedly surprised very few, the RBA left the cash rate on hold at 1.50% at its May meeting, making this the longest spell of inactivity since 1990. While there was no discernible shift in rhetoric, the Bank noted that inflation is moving in line with expectations, sitting just below the target 2% rate. While inflation is still below target nationally, the ABS notes that the east coast is generally experiencing inflation in excess of 2%, boosted by the Housing and Food groups.


 

The information contained in this Market Update is current as at 18/05/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

April Market Update 2018

The Pulse

  • The global economy is maintaining momentum and inflation is gradually moving higher in line with central bank targets.
  • Growth in US average hourly earnings is still not showing conclusive evidence of a sustained pickup in wages.
  • The threat of a trade war between the US and China is creating significant uncertainty for markets.
  • Euro area inflation was 1.4% in March, up from 1.1% in February but still well below the ECB’s target.
  • The Australian economy continues to improve, but the RBA is wary of the impact of interest rate rises on the household sector.

Global economies

While underlying economic data is broadly positive, markets remain concerned about the prospect of inflation as well as the potential for a trade war between the US and China. Shares continued to sell off in March as investors favoured bonds, property and defensive sectors. The US economy is maintaining momentum and measures of underlying price inflation are gradually moving higher, but signs of imminent wage inflation have not yet materialised.

US

The prospect of a trade war has been the cause of some consternation for markets over the past month, with China announcing a retaliatory 25% levy on a range of US products, including soybeans, cars and whiskey. While US steel and aluminium hardly represent the new economy, it is the response from US trade partners that poses the greatest uncertainty.

Europe

Despite stronger than expected growth throughout the eurozone, the ECB kept its key interest rates on hold in March, although notably dropping its usual commitment to increase the size of quantitative easing if the situation deteriorates.

China

Economic data for the early part of 2018 has been mixed, with manufacturing PMIs failing to break out of the low 50s, while exports, industrial production and retail spending data have surprised on the upside.

Asia Region

Although headline GDP growth numbers in Japan have been low in absolute terms, by Japanese standards they have been solid, resulting in a narrowing of the output gap. Japan’s Q4 GDP growth of 1.6% year-on-year is the 16th quarter of positive growth, but there have been a number of misses along the way.

Australia

Despite leaving the cash rate on hold at its March meeting, the RBA continues to expect labour markets to tighten globally, and for central banks to get on the front foot by withdrawing stimulus. In its statement, the RBA mentioned the market’s concerns about US trade policy and its contribution to heightened volatility. The RBA and Treasury both expect GDP growth to be in excess of 3% over the next two years, but monetary policy is still extremely accommodative.

 


 

The information contained in this Market Update is current as at 16/04/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

March Market Update 2018

The Pulse

  • Perhaps paradoxically, February’s market turmoil was a response to signs that the global economy is reducing slack.
  • US employment and wage indicators led investors to take a more “inflationist” view, with a rise in yields pre-empting future Fed tightening.
  • Price pressures in Europe also appear to be picking up, with PMIs pointing to stronger economic growth in Q1 2018.
  • The Chinese economy appears to be stuck in neutral, with mixed PMIs and inflation falling to 1.5% year-on-year.
  • The Australian economy continues to improve, but wages growth remains subdued and the RBA is unlikely to raise rates in the near term.

Global economies

The market’s attention has turned to the outlook for inflation, and the potential for central banks to respond with tighter monetary policy. The resultant rise in bond yields, together with a reassessment of equity market valuations, gave way to February’s market pullback. Economic indicators are robust, but anticipated interest rate moves are a key determinant for markets.

US

With the US unemployment rate falling to 17-year lows, the expectation of both policymakers and investors is that wages growth will eventually pick up, and with it inflation. January data provided evidence that the US economy may be starting to run up against some capacity constraints.

Europe

Growth in the eurozone continues to surprise on the upside, with GDP rising 0.6% in the December quarter, bringing year-on-year growth to 2.7% (which is significantly higher than what economists were predicting at the start of 2017). It is even possible that the 0.6% figure may be revised higher in line with recent trend revisions.

China

China’s February PMI readings were mixed, with the official index down to 50.3 from 51.3 and missing expectations, while the Caixin PMI moved slightly higher from 51.5 to 51.6. Industrial production growth in December was 6.2%, which narrowly beat consensus, while private investment was subdued at 7.2% and retail sales growth eased to 9.4% from 10.2%.

Asia Region

Japanese GDP rose by a disappointing 0.1% in the December quarter, slowing from a 0.6% rise in the previous quarter, however this is the eighth consecutive quarter of growth. On a positive note, the Nikkei Japan Services PMI indicates increased strength in the manufacturing sector, with new business opportunities increasing at the fastest rate in four years.

Australia

The outlook for Australia continues to improve, with unemployment expected to approach 5% over coming years and wages growth to pick up modestly. Australia’s labour market continues to tighten, with 16,000 seasonally adjusted jobs added in January. The past 12 months have seen the participation rate grow steadily, from 64.8% to 65.6% in trend terms—close to historic highs and back to pre-GFC levels. From a monetary policy perspective, this outlook suggests that while the next move in cash rates is likely to be up, there is little urgency.

 


 

The information contained in this Market Update is current as at 13/03/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

February Market Update 2018

The Pulse

  • The global economy is benefiting from a broad-based, cyclical recovery, supported by higher levels of investment and accommodative monetary policy.
  • The US economy ended 2017 on a slightly shaky footing, although the overall employment situation continues to improve and the bond market is anticipating further rate hikes.
  • Growth in Europe continues to surprise on the upside, supported by rises in private consumption and business investment.
  • The Chinese economy slowed marginally in the December quarter, with GDP growth falling to 6.8% and PMI figures lower than expected.
  • The Australian economy continues to improve, although weaker than expected inflation all but scuppered the chance of a February rate hike.

Global economies

The start of 2018 saw a moderation in economic data from major developed markets, although business investment and favourable employment conditions are providing a solid foundation for growth. While inflation remains below target in advanced economies, central banks have begun the process of gradually tightening monetary policy.

US

The US economy ended 2017 on a slightly shaky footing, with the first estimate of Q4 GDP recording growth of 2.6%, slowing from Q3’s growth of 3.2% and lower than the market’s anticipated 3.0%. Imports, which subtract from GDP growth, increased at their fastest rate in more than seven years, highlighting the challenge facing the Trump administration in achieving its 3.0% growth target.

Europe

Euro area GDP grew by 0.6% in Q4 (2.7% year-on-year), slightly lower on Q3’s growth of 0.7% (2.8% year-on-year). Recent survey data shows that manufacturing is growing at the fastest rate in over two decades, while the services sector enjoyed its best year since 2007. Major European shares leapt to record earnings early in 2018, despite a rising euro and falling US dollar.

China

The Chinese economy slowed marginally in the December quarter, with GDP growth falling to 6.8% after averaging 6.9% in the first three quarters of 2017. A clampdown on factory pollution, a further lift in borrowing rates, and tighter financial conditions in the shadow banking sector are likely to have dampened growth.

Asia Region

In Japan, Q3 GDP growth was revised up to an annualised 2.5% from a preliminary estimate of 1.4%, and just shy of the 2.6% recorded in Q2. The main drivers of growth were corporate investment and net exports, offset by a contraction in domestic consumption. Inflation is estimated at 0.7% for fiscal year 2017, and 1.1% for 2018. Consumer prices are still lagging in an economy that appears to be growing at a steady pace, thwarting the Bank of Japan’s attempts to achieve its 2% inflation target.

Australia

The economic outlook for Australia has improved in recent months with evidence of a recovery in business investment now complementing the very strong labour market and business conditions data. The RBA’s February monetary policy statement was undeniably more bullish compared to its December release, but nevertheless the board opted to keep the cash rate on hold at 1.50%, with inflation still low but expected to move higher.

 


 

The information contained in this Market Update is current as at 14/02/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

January Market Update 2018

The Pulse

  • As was strongly anticipated by the market, the US Fed lifted the funds rate to 1.5% in mid-December.
  • The US economy appears to be operating near capacity, with an unemployment rate of just 4.1% and an underemployment rate of 8% – the lowest since 2006.
  • The recovery in Europe continues to defy expectations, with no sign of confidence diminishing despite political uncertainty in Germany and Spain.
  • The Chinese economy has also exceeded expectations in 2017, expanding by just under 7% in the first three quarters.
  • The Australian economy is being impacted by weak wages growth, but December saw an encouraging jump in consumer sentiment.

Global economies

December saw positive economic news from major developed markets, with rising levels of business sentiment and favourable employment conditions providing a solid foundation for growth. While inflation remains below target, central banks have begun the process of gradually tightening monetary policy as labour market conditions continue to improve.

US

In the United States, the final estimate of Q3 GDP indicated real growth of 3.2%, which is slightly lower than the second estimate reading of 3.3% but still growing at its fastest pace in more than two years. Growth in consumer spending, which accounts for more than two thirds of the economy, was revised down 0.1 points to 2.2%.

Europe

Growth across the 19 eurozone countries has improved steadily over the past year, and the recovery has also become more broad-based, both across different countries and sectors. In December, the European Central Bank made a significant upgrade to its 2018 growth forecast for the euro area, lifting its expected annual growth rate from 1.8% to 2.3%, while the outlook for inflation also moved higher from 1.2% to 1.4%.

China

Recent Chinese data indicates a slight loss of momentum in recent months. Although China’s official PMI picked up to 51.8 from 51.6, the Caixin PMI dropped to its lowest level in five months. Measures of industrial production and investment also appear to have softened, while policy tightening has focussed on the property sector.

Asia Region

In Japan, Q3 GDP growth was revised up to an annualised 2.5% from a preliminary estimate of 1.4%, and just shy of the 2.6% recorded in Q2. The main drivers of growth were corporate investment and net exports, offset by a contraction in domestic consumption. Inflation is estimated at 0.7% for fiscal year 2017, and 1.1% for 2018. Consumer prices are still lagging in an economy that appears to be growing at a steady pace, thwarting the Bank of Japan’s attempts to achieve its 2% inflation target.

Australia

While there was no monetary policy meeting of the RBA in January, December’s minutes revealed the board’s continued ambivalence towards domestic conditions. Wages remain stable at a low rate, despite the 3.3% increase in awards and minimum wages in the September quarter, and this appears to have impacted household spending.


 

The information contained in this Market Update is current as at 21/01/2018 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

December Market Update 2017

The Pulse

  • The global economy continues to generate synchronised growth and markets are expecting these conditions to continue into 2018.
  • In the US, both houses of Congress have approved bills to reform and lower corporate and personal taxes paving the way for new tax laws in coming months.
  • In Europe, business conditions are at 16-year highs suggesting that the Eurozone can continue to generate above-average economic growth.
  • In China, regulators continue to try to reign in credit growth and curb speculative investment.
  • The Australian economy is being impacted by weak wages growth which is leading consumers to rein in spending.

Global economies

Economic news over the past month has confirmed that the major economies are continuing to enjoy relatively healthy growth in the second half of 2017 with falling unemployment and robust business and consumer sentiment surveys suggesting that current economic conditions can continue into next year.

US

In the United States, separate tax reform bills were passed in both the House of Representatives and Senate, paving the way for tax cuts for both companies and individuals assuming that the two bills can be reconciled. For major companies, the headline tax rate is expected to fall from 35% to 20% and, all else being equal, this should boost corporate earnings, but risks saddling the economy with higher levels of government debt if the tax cuts don’t stimulate higher economic activity.

Europe

In the Eurozone, the economy continues to perform strongly with retail sales growing 3.7% year-on-year, reflecting recent strong consumer sentiment readings. The purchasing manager surveys for the Eurozone have also continued to strengthen with the composite PMI index at a new cyclical high in November suggesting that the Eurozone economy should be growing at about a 3.5% year-on-year, higher than last quarter’s 2.5% growth rate.

China

Chinese activity data slowed more than expected in October and business surveys in November have also pointed to slower activity. The slowdown appears to relate to government efforts to close capacity in the metals sector to help reduce pollution.

Asia Region

In Japan, the preliminary estimate of quarterly real GDP growth slowed to 0.3%, marginally below expectations. This was the seventh consecutive positive quarter for growth and was enough to boost annual growth from 1.4% to 1.7%, which is above the Bank of Japan’s estimate of potential growth (of just 0.5-1.0%).

Australia

In Australia, the economy grew slightly less than expected, expanding 0.6% in the September quarter with household consumption growth particularly weak. This was likely linked with the weak wages growth which rose only 0.5% over the quarter despite the increase in the minimum wage in July. However, the economy continues to generate strong jobs growth and with business conditions at elevated levels the robust employment conditions should continue into next year.


 

The information contained in this Market Update is current as at 12/12/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

November Market Update 2017

The Pulse

  • Recent economic data continues to show that the major economies are all growing and that global growth is accelerating.
  • In Japan, the recent elections returned Prime Minister Shizo Abe’s Liberal Democratic Party with a larger majority allowing a continuation of Abenomics.
  • In the US, markets reacted favourably to the details of the Republican tax reforms and news that Jerome Powell will be nominated as the next Federal Reserve Chairman.
  • In China the 19th Communist Party Congress elected Xi Jinping for another five years as President and General Secretary paving the way for further reform of the Chinese economy.
  • Australian employment continues to grow strongly helped by strong business conditions.

Global economies

Despite another busy month in both a political and non-political sense, there was little out there to rattle equity markets during October.  While the turmoil in Spain regarding the independence of Catalonia, and the announcement of charges being filed against three former Trump campaign personnel, caused market jitters, the broad theme of synchronised global economic growth and strong corporate earnings has continued.

US

In the United States, unemployment and underemployment have both fallen to new cyclical lows of 4.1% and 7.9% respectively, however, wages growth and inflation are still both subdued.  October’s ISM non-manufacturing index rose to its highest since the index began in 2005 and the ISM manufacturing survey also remains at healthy levels with both indices suggesting that fourth quarter growth could be relatively solid.

Europe

In the Eurozone, the initial estimate of annual GDP growth in the September quarter was better than expected, rising to 2.5% (from 2.3% in the June quarter) which is now the best growth rate since 2011.

China

In China, the official PMIs for October suggest that the economy has slowed a little in recent months.  In the detail, PMIs for medium and small sized manufacturing firms are now both in contraction territory.  The 19th Communist Party Congress went smoothly for President Xi cementing his power for the next five years and providing a mandate to more aggressively pursue economic reform.

Asia Region

In Japan, Shinzo Abe’s gamble to hold an early election last month paid off and the ruling Liberal Democrat Party retained its two-thirds majority of the lower house, effectively locking them in power until 2021. For investors, the win secures the future of Abenomics, and in particular the aggressive easing of monetary policy.

Australia

In Australia, October saw another strong employment report with unemployment falling from 5.6% to 5.5% and business conditions remaining at strong levels.  However, September quarter inflation was lower than expected falling from 1.9% to 1.8% year-on-year.  Retail sales have also been subdued with sales flat in September after falling in both July and August as consumers battle with low wages growth and higher utility bills.


 

The information contained in this Market Update is current as at 13/11/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

October Market Update 2017

The Pulse

  • Economic data released over the past month has continued to give investors optimism that the global economy is experiencing synchronised growth for the first time in many years.
  • Investor concern over tensions between the United States and North Korea has subsided.
  • Early economic indicators from the United States suggest that the recent hurricanes have not had a large impact on overall economic activity.
  • German elections returned Angela Merkel as Chancellor but her win was narrower than expected.
  • The Australian economy continues to show strong business conditions but consumers are reluctant to spend on anything except essential items.

Global economies
Equity markets posted strong returns in September as geopolitical tensions with North Korea subsided and investors focused on elections in Germany and Japan and the US Fed’s plans to begin shrinking its US$4.5 trillion balance sheet starting this month.

US
Despite some distortions in the economic data caused by recent hurricanes, most of the data in the US has continued to show relatively strong economic activity. Unemployment has fallen to new cyclical lows of 4.2%, and the uptrend in wages growth appears to have resumed with the most recent reading showing annual wages growth at close to 3%.

Europe
In the Eurozone, business, consumer and economic sentiment surveys all suggest that the economy continues to perform well. Recent industrial production and factory order data from Germany has confirmed that business activity in Germany is still strong despite the headwinds to German exporters from the stronger Euro.

China
Chinese data over the past month has continued to be somewhat mixed. The official government PMIs, which tend to measure activity levels at the larger Chinese manufacturing and non-manufacturing firms, both rose to the highest levels in several years, while the privately-commissioned surveys (which tend to measure small to mid-sized business activity) showed softer conditions.

Asia Region
In Japan, the Bank of Japan’s quarterly Tankan survey showed that both big and small Japanese manufacturers are the most confident about business conditions in a decade, helped by a weaker Yen and strong global demand.

Australia
In Australia, the strong business conditions are continuing to create relatively robust jobs growth. Employment grew more strongly than expected in August and, pleasingly, there has been a rebound in the number of full-time jobs which had lagged part-time job growth.  However, while businesses are enjoying strong conditions, consumers are not so optimistic with evidence of belt-tightening showing in recent retail sales figures, which have now declined for two months in a row.


 

The information contained in this Market Update is current as at 13/10/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

September Market Update 2017

The Pulse

  • Economic data released over the past month has continued to paint a relatively good picture of global growth with most of the major economies experiencing accelerating economic growth in the June quarter.
  • Geopolitical tensions remained heightened in August and this helped drive down bond yields.
  • Political gridlock in the United States increased nervousness about a potential government shutdown.
  • Strong earnings reports from companies in the United States and Europe were largely ignored and global equity markets were essentially flat over the month.
  • Australian GDP growth rebounded in the June quarter after the weather affected softer March quarter.
  • Australia’s earnings reporting season was a touch disappointing with a higher than average number of companies missing earnings projections and many companies lowering their guidance for the year ahead.

Global economies

Reasonably good economic news and earnings reports in the US and Europe were largely ignored by investors, who were more focussed on the escalating geopolitical tensions involving North Korea, as well as the impending US debt ceiling and government shutdown negotiations.

US

Most of the economic data in the United States over the past month has been relatively good. GDP growth in the June quarter was revised up from 2.6% to 3.0% annualised growth helped by stronger household consumption and investment growth.

Europe

In the Eurozone, the strong momentum seen earlier this year has continued with economic growth revised up from 2.1% to 2.2% in the June quarter, and business and consumer surveys have remained at strong levels suggesting that the economy is in reasonable shape. Inflation has also ticked up a little, although as in other countries it remains below the European Central Bank’s target rate.

China

Chinese data over the past month has been a little mixed with some indicators such as the business surveys pointing to better conditions whereas other indicators such as industrial production, retail sales growth and fixed asset investment slowed over the past month.

Asia Region

In Japan, the consumer price index rose an expected 0.4% year-on-year in July, however, the Bank of Japan’s preferred measure of core annual inflation remained very low at just 0.1%. Meanwhile the July employment report in Japan remained strong, with the unemployment rate staying at a very low rate of 2.8%.

Australia

In Australia, the June quarter GDP figures painted a picture of an economy in reasonable shape after the weather affected softness in the prior quarter. The 0.8% quarterly expansion in the economy was boosted by strong growth in household consumption, business and government investment and LNG exports.


 

The information contained in this Market Update is current as at 27/09/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

August Market Update 2017

The Pulse

  • In a relatively quiet month for economic and policy news, global equity prices rose, helped by corporate earnings reports in the United States and Europe that were relatively strong.
  • The US Dollar fell 2.9% against a trade-weighted basket of currencies as the “Trump Slump” continued.
  • Over the month the lower US Dollar, and Chinese policies to cut metal production capacity, boosted commodity prices denominated in US Dollars such as oil, copper, aluminium and iron ore.
  • US technology stocks renewed their uptrend helped by strong earnings reports from Apple, Facebook and Google’s parent company Alphabet.
  • Chinese economic growth remained at a strong 6.9% annual rate in the June quarter.
  • Australia’s equity market traded sideways for the second month in a row as investors remained cautious ahead of reporting season.

Global economies

Economic data has continued to be relatively good in July, however, many of the “soft” indicators, based on business and consumer surveys, have weakened from their post-US election highs as Donald Trump continues to struggle to deliver on his election promises.

US

GDP figures for the June quarter confirmed that the US economy continues to grow at around 2% per annum, well below the 3% level targeted by Donald Trump and below the levels suggested by business and consumer surveys in early 2017.

Europe

In the Eurozone, economic growth rates have picked up from 1.9% year-on-year in the March quarter to 2.1% in the June quarter and unemployment has declined further, now at 9.1%, which is the lowest since the global financial crisis. Against this backdrop, the European Central Bank has dropped its reference to “downside risks” in its outlook for the European economy and this allows it to gradually move towards tapering of its €60 billion per month in asset purchases later this year with interest rate rises in 2018.

China

Chinese data released over the past month has shown that the economy there continues to perform relatively well with stable annual growth of 6.9% in the June quarter, supported by property and infrastructure construction. Other indicators such as industrial production, international trade, retail sales and fixed asset investment also paint a picture of an economy that is performing well.

Asia Region

In Japan, the consumer price index rose an as expected 0.4% year-on-year in June, however, the Bank of Japan’s preferred measure of core annual inflation remained stuck at zero for the third consecutive month. Meanwhile the June employment report in Japan remained strong, with the unemployment rate falling back down to 2.8% after being a little higher in June.

Australia

In Australia, most of the data released in the past month has been in line with expectations, which usually means that it has followed recent trends. The unemployment rate remained stable at 5.6% in June, the core annual rate of inflation was stable at 1.8% in the June quarter and the RBA kept interest rates on hold in early August.


 

The information contained in this Market Update is current as at 21/08/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

July Market Update 2017

The Pulse

  • In June markets were influenced by political developments in the UK and US and more hawkish commentary from central bankers suggesting that soft inflation is only transitory.
  • European equities lost 2.8% in June after two Italian banks were bailed out by the Italian government and ECB President Draghi hinted at tighter monetary policy.
  • The UK election resulted in a hung parliament creating additional uncertainty as to how the Brexit negotiations will unfold.
  • US technology stocks, which had enjoyed solid price rises, gave back some of their recent gains with the NASDAQ Composite Index down 0.9% in June.
  • Chinese activity indicators were a little softer but still remain at strong levels.
  • Australian employment data was stronger in the past month and the unemployment rate fell to the lowest rate since February 2013.

Global economies

Economic data was relatively good in June with no major surprises which meant that investors were mainly focussed on speeches by central bankers and on political developments in the United States and United Kingdom

US

In the US, as expected the US Federal Reserve lifted interest rates for the second time this year. Speeches by various Fed officials suggest that notwithstanding core annual inflation which was just 1.4% in May, and well below the Fed’s 2.0% per annum target, they believe that the recent softness is transitory. 

Europe

In Europe, survey-based measures of activity have remained strong, with indicators such as consumer confidence rising to fresh 16-year highs and Germany’s IFO business climate index making a new post-financial crisis high. At a recent conference in Portugal, European Central Bank President Mario Draghi said all the signs now point to a strengthening and broadening recovery in the Euro area which was interpreted by investors as a signal that the ECB could soon flag its intention to begin withdrawing ultra-easy monetary policy conditions.

China

China’s activity indicators were more or less in line with recent trends showing factory output and retail sales growing at a steady pace in May but fixed asset investment slowing, reinforcing views that the economy may be losing some momentum as lending costs rise and the property market cools.

Asia Region

In Japan, core inflation was 0.4% year on year in May which was the fifth straight month of price rises but still well below the Bank of Japan’s ambitious 2% per annum target.

Australia

In Australia, employment rose by 42,000 jobs in May which was above expectations. The unemployment rate fell from 5.7% to 5.5%, which was the lowest rate since February 2013. The employment report also showed a pick-up in full time jobs and hours worked, both of which have been soft in recent months. Despite the rise in the number of people employed and recovery in the total number of hours worked, the level of underemployment – those people working but who want more hours – has remained elevated and this is keeping wages growth at very low levels.


 

The information contained in this Market Update is current as at 19/07/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

June Market Update 2017

The Pulse

  • Markets in May were heavily influenced by political developments in the major economies.
  • European equities returned 2.6% in May helped by Emmanuel Macron’s convincing win in the French Presidential election.
  • In the middle of the month equities were sold off on revelations that Donald Trump may have pressured former head of the FBI, James Comey, to drop investigations into Russian interference in the US election.
  • Chinese activity indicators were softer last month but still remain at relatively high levels.
  • Australian economic data showed that the economy barely grew in the March quarter due to weather-related factors which impacted on net exports.

Global economies

Economic data has continued to be somewhat mixed in May with further falls in the unemployment rate in the US and Europe offset by softer inflation readings.  Markets were also influenced by political developments in the United States and Europe.

US

In the US, some of the momentum in economic growth appears to have softened.  Non-farm payrolls growth has slowed over the past few months despite the unemployment rate falling to the lowest levels since 2001.  Measures of inflation and wages growth, which had been trending higher, have also fallen back over the past few months leading investors to question whether the recent softness is transitory or part of a longer-term trend.

Europe

In the Eurozone, survey-based measures of activity have continued to remain at strong levels, however, core inflation fell from 1.2% in April to 0.9% in May which gives further weight to European Central Bank President Mario Draghi’s recent suggestion that tapering of bond purchases and interest rate hikes may be further away than investors have been expecting.

China

China’s activity indicators were disappointing last month with slower growth in retail sales, industrial production and fixed asset investment.  There is also some evidence that the strong credit-fuelled growth in new home prices has begun to slow as the government moves to reign in property speculation.

Asia Region

In Japan, GDP growth in the March quarter was revised down from an annualised rate of 2.2% to 1.0%, largely due to lower corporate inventories, although private consumption and housing investment figures were also adjusted a little lower.  Despite the downgrade to growth estimates, the Japanese economy has had five quarters of continuous economic growth which is the longest period of economic expansion in more than a decade.

Australia

In Australia, GDP growth for the March quarter was relatively soft with the economy growing only 0.3% over the quarter or 1.7% over the past year, which is the slowest annual growth rate since the financial crisis in 2009.  While part of the softness was weather-related, household consumption growth remains subdued. Slow rates of wages growth are constraining spending with the impact being mostly felt in the retail sector as households are forced to spend more on essential services such as education, healthcare and utilities.


 

The information contained in this Market Update is current as at 20/06/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

May Market Update 2017

The Pulse

  • In April, equity markets rose in April helped by political developments in Europe and solid US corporate earnings reports.
  • In the United States, the technology-laden NASDAQ Composite Index rose to all-time highs, boosted by strong earnings results from the major technology companies.
  • US consumer and business sentiment surveys fell back from the recent highs reached following Donald Trump’s election win.
  • Chinese economic growth in the March quarter was stronger than expected and other activity indicators were also higher than in prior months.
  • Australian economic data was relatively good with stronger-than-expected employment growth in March and a rise in inflation.

Global economies

Economic data was a little mixed in April with some seasonal softness in the US offset by stronger data elsewhere. European equities were boosted by the results of the first round of the French Presidential Election which saw centrist candidate Emmanuel Macron become the most likely winner with a strong lead over Euro-sceptic Marine Le Pen.

US

In the US the advance estimate of first quarter GDP was weaker than expected, rising at an annualised rate of just 0.7% with personal consumption growing at an annualised rate of only 0.3%. Non-farm payrolls were also weaker than expected with just 98,000 new jobs in March, which was the weakest reading since May 2016. The ISM manufacturing index was also weaker than expected in April as consumer and business sentiment declined from their recent post-US election highs.

Europe

In the Eurozone, GDP grew 0.5% over the first quarter, or 1.7% over the past year, marking four straight years of economic growth. In the United Kingdom, GDP growth in the March quarter was a little weaker than expected at 0.3% due to some softness in consumer spending, which has been impacted by the lower British Pound, which has increased prices for British consumers.

China

China’s economic data has been relatively strong in April. GDP increased 6.9% year-on-year in the March quarter, up from 6.8% in the previous quarter and above expectations of a 6.8% increase.

Asia Region

In Japan, real household spending fell 1.3% year-on-year in March and core consumer prices have only increased 0.2% over the past year reflecting Japanese consumer caution. The Bank of Japan has kept official interest rates at -0.10% per annum and continues to buy significant volumes of Japanese government bonds each month with the aim of keeping the yield on the 10-year government bond at around zero.

Australia

In Australia, employment increased by 60,900 jobs in March, above expectations of an increase of 20,000 jobs, which took annual employment growth to a six-month high of 1.2% year-on-year. The unemployment rate remained steady at 5.9% – in line with market expectations. Australian inflation, which has been very low over the past few years, recovered marginally in the March quarter with the headline CPI 2.1% higher over the year and core annual inflation increased from 1.6% to 1.8%.


 

The information contained in this Market Update is current as at 17/05/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

2017 Federal Budget Analysis

The Federal Budget Analysis prepared by the MLC Technical team, part of GWM Adviser Services Limited, appears below.

First home savers, downsizers and small business are the winners in Treasurer Scott Morrison’s second Budget – while taxpayers face an increase in the Medicare levy.
Note: These changes are proposals only and may or may not be made law

Superannuation
Contributions from downsizing the home
Date of effect: 1 July 2018

Individuals aged 65 or older will be able to make non-concessional (after tax) super contributions of up to $300,000, using proceeds from the sale of the family home. This limit will:

  • apply on a per person basis
  • be in addition to the ordinary non-concessional contribution cap, and
  • be available where the home has been owned for at least 10 years.

Unlike other non-concessional contributions, it will not be necessary to meet a work test or have a ‘total super balance’ under $1.6 million. The amount contributed will not be exempt from the assets test used to assess eligibility for the Age Pension.

First home super saver scheme
Date of effect: From 1 July 2017

First home buyers will be able to save for a deposit by making voluntary concessional and non-concessional super contributions. Contributions will be limited to $15,000 per year (up to a total of $30,000) and will count towards the relevant contribution cap.
Withdrawals can be made from 1 July 2018. Concessional contributions plus assumed earnings withdrawn will be taxed at the person’s marginal tax rate, less a 30% tax offset.
The Government has provided an online estimator to help individuals calculate the potential benefit of the scheme.

SMSF borrowings
Date of effect: When law is passed

Broadly, when new limited recourse borrowing arrangements are established, the loan balance will be included in an individual’s ‘total super balance’. The total super balance is used to determine a person’s ability to:

  • make non-concessional contributions
  • qualify for a Government co-contribution or a spouse contribution tax offset, and
  • make catch-up concessional contributions above the annual caps from 1 July 2018, where certain conditions are met.

Also, repayments made from the SMSFs accumulation balance will count towards the member’s transfer balance cap, if the borrowing supports a pension account. The transfer balance cap limits the total lifetime transfers a person can make to retirement phase pensions.

Taxation
Medicare levy increase
Date of effect: 1 July 2019

The Medicare levy will increase from 2% to 2.5% pa to fully fund the National Disability Insurance Scheme. This increase will flow to a range of other taxes such as Fringe Benefits Tax.

Small business accelerated depreciation
Date of effect: 1 July 2017
The ability for small businesses with an annual turnover of $10 million or less to claim an immediate deduction for eligible assets costing less than $20,000 each will be extended for 12 months.

HELP thresholds and rates
Date of effect: 1 July 2018
The annual income threshold at which Higher Education Loan Program (HELP) repayments commence will be reduced to $42,000 (currently $54,869). Also, the repayment rate will start at 1% and increase progressively to 10%.

Social Security
Pensioner Concession Card
Date of effect: From 1 July 2017
Individuals who lost entitlement to the Pensioner Concession Card as a result of the 1 January 2017 assets test changes will be reissued with the card.

Energy Assistance Payment
Date of effect: 20 June 2017
Eligible pensioners will be entitled to a one-off Energy Assistance Payment of $75 for singles and $125 per couple. Eligible recipients include Australian residents who qualify for the Age Pension, Disability Support Pension and Service Pension.

Residency requirements for pensioners
Date of effect: 1 July 2018
To be eligible for the Age Pension and Disability Support Pension (DSP), claimants will need to have 15 years of continuous Australian residence unless they have either:

  • 10 years continuous Australian residence, with 5 years of this being during their working life, or
  • 10 years continuous Australian residence, without having received an activity tested income support payment for a cumulative period of 5 years.

Existing exemptions will continue to apply for DSP applicants who acquire their disability in Australia.

Family Tax Benefit – Part A
Date of effect: 1 July 2018
A single taper rate of 30 cents in the dollar will apply to income that exceeds the Higher Income Free Area ($94,316 in 2016/17). Currently, two tests are applied and the higher payment determines the entitlement.

Family Tax Benefit – Part A and B
Date of effect: 1 July 2017
The payment rates will not be indexed for two years. Indexation will resume on 1 July 2019.

Liquid Assets Waiting Period
Date of effect: 20 September 2018
The maximum Liquid Assets Waiting Period (LAWP) will increase from 13 to 26 weeks. The LAWP is a period an individual will be ineligible to receive Government income support. The new maximum period will apply to:

  • singles without dependents with liquid assets of more than $18,000, or
  • couples, or singles with dependents, with liquid assets of more than $36,000.

Liquid assets are readily available assets such as bank accounts, terms deposits, shares and managed funds.


The information contained in this Federal Budget Analysis is current as at 9 May 2017 and is prepared by MLC Technical, part of GWM Adviser Services Limited ABN 96 002 071749, registered office 150-153 Miller Street North Sydney NSW 2060,  a member of the National Australia Bank Group of Companies.

Any advice in this Federal Budget Analysis has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Any tax estimates provided in this publication are intended as a guide only and are based on our general understanding of taxation laws. They are not intended to be a substitute for specialised taxation advice or a complete assessment of your liabilities, obligations or claim entitlements that arise, or could arise, under taxation law, and we recommend you consult with a registered tax agent.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

April Market Update 2017

The Pulse

  • In March, global equity markets were quite mixed. US shares and bonds traded sideways as Donald Trump’s promise to repeal of the Affordable Care Act failed to gain congressional support, which has called into question whether his other policies, such as tax reform, can also be approved.
  • On equity markets the Dow Jones Industrial Average equity index fell 0.6% in the US over the month while shares in Europe rose 3.5% and Australian shares returned 3.3%.
  • US consumer sentiment indicators rose to their highest levels in 16 years and business surveys have also remained at high levels reflecting optimism about future growth.
  • Chinese activity indicators suggest that economic conditions continue to improve and the economy is being supported by robust global demand.
  • Australian economic data softened a little in the past month with a fall in retail sales and a rise in unemployment as well as softer business conditions. However, the economy continues to perform relatively well, supported by higher commodity prices and strong housing construction activity.

 Global economies

Global equity markets were mixed in March with strong rises in Europe offset by declines in Japan and relatively flat performance in the United States. Economic data was, on the whole, relatively good – particularly “soft” economic indicators such as business and consumer sentiment surveys that suggest that economic growth could rise significantly.

US

In the US, the Federal Reserve increased the Fed Funds Target range from 0.50 -0.75% to 0.75 – 1.00% per annum, as expected, and subsequent speeches from Federal Reserve Open Markets committee members suggested that two to three more rate rises are likely in 2017.

 Europe

In the Eurozone, the aggregate manufacturing PMI increased to 56.2 in March, up from 55.4 in February, and the highest reading since April 2011. In Germany, the IFO business climate index rose to 112.3 in March (from 111.0 in February), the highest level in six years and back towards pre-financial crisis highs. In the United Kingdom, headline inflation increased 0.7% in February, lifting annual inflation to 2.3% year-on-year, which is the highest inflation rate since September 2013.

 China

China’s official manufacturing PMI rose to 51.8 in March from 51.6 in February, higher than economist expectations, and the highest level in five years, suggesting that the world’s second largest economy is gathering momentum.

 Asia Region

In Japan, real household spending fell 3.8% year-on-year in February, showing Japanese consumers are reluctant to spend. This is despite the unemployment rate falling from 3.0% in January to 2.8% in February.

 Australia

In Australia, employment fell by 6,400 jobs in February which was below expectations and the unemployment rate increased to 5.9% from 5.7%. The total number of hours worked slumped 1.2% over the month suggesting that there is some excess capacity in the labour market which is holding down wages growth.


The information contained in this Market Update is current as at 27/04/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

March Market Update 2017

The Pulse

  • In February, global equity markets continued to trend higher boosted by optimism about US growth and reasonably good economic and corporate earnings data.
  • In the United States, the Standard & Poor’s 500 equity index rose 4.0% over the month pushing its 12-month return to 25%.
  • US business sentiment indicators rose further with small business optimism jumping significantly.
  • Chinese activity indicators suggest that economic conditions have bounced back and the economy is being supported by robust global demand.
  • Australia’s December quarter GDP was stronger than expected, rising 1.1% over the quarter reversing the weather-affected 0.5% contraction in the economy in the prior quarter.

Global economies

Global equity markets extended their post-US election rally in February driven by solid quarterly earnings reports in the US and strong economic data in the US and Europe. Most of the major economies reported higher inflation boosted by stronger energy and food prices.

US

In the US, the headline CPI rose 0.6% in January, which was double market expectations and the annual inflation rate rose to 2.5% year-on-year, which is the highest rate since March 2012. In addition, the manufacturing ISM index rose for the sixth straight month to a robust level of 57.7 in February, which was the best reading since August 2014.

Europe

In the Eurozone, the manufacturing PMI for February came in at 55.4, the highest level in six years. In Germany, the harmonised measure of inflation rose 0.7% in February, which was stronger than expected, and this pushed annual inflation to 2.2%, which is the highest annual rate since August 2012. In the United Kingdom, the economy grew faster than predicted in the fourth quarter of 2016, growing 0.7% over the final three months of the year rather than the 0.6% initial growth estimate. UK GDP has now grown for 16 consecutive quarters, despite Treasury forecasts for a steep contraction in economic activity following the Brexit decision.

China

China’s official manufacturing PMI rose to 51.6 in February, which is a three-month high and suggesting that the recent pick-up in global demand is supporting China’s manufacturing recovery.

Asia Region

Japan’s economy still remains stuck in low gear despite zero long-term interest rates. Japan’s GDP in the December quarter rose 0.2% quarter-on-quarter, below expectations of a 0.3% increase, but the fourth consecutive quarter of growth.

Australia

In Australia, after a period of softness in economic data, some of the indicators have rebounded, in some cases helped by higher commodity prices. The unemployment rate ticked down from 5.8% in December to 5.6% in January. GDP growth was stronger than expected in the fourth quarter of 2016, rising 1.1% for the quarter and 2.4% year-on-year, beating expectations of a 0.8% rise and helped by strong corporate profits and investment. Australia’s current account deficit was the smallest in 15 years in the December quarter, at $3.9 billion, thanks to a surge in prices for Australia’s exports.


The information contained in this Market Update is current as at 13/03/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

February Market Update 2017

The Pulse

  • In January, global equity markets continued to rise with the US share market making fresh record highs as investors continued to react positively to Donald Trump’s election as 45th President of the United States.
  • In the United States, the Dow Jones Industrial Average Index closed above 20,000 for the first time.
  • US manufacturing indicators continued to rise and point to economic expansion.
  • Chinese December quarter GDP growth was better than expected, rising 6.8% year-on-year.
  • Australia’s December quarter CPI came in below market expectations, rising 0.5% over the quarter and 1.5% year-on-year, below the Reserve Bank of Australia’s target range of 2-3% per annum.

Global economies

Global equity markets continued their post-US election rally in January helped by optimism following the US election. Most of the economic data released in January reflected trends that have been observed over the previous few months: improving sentiment and economic conditions in the United States, Europe and China.

US

The initial estimate of fourth quarter US GDP growth was a little below expectations –1.9% annualised growth versus expectations of 2.2%. Household consumption and business investment showed reasonably good growth, however, the contraction in net exports detracted from the overall growth rate and was some payback from strong exports in the prior quarter.

Europe

In the Eurozone, the inflation rate jumped to 1.8% year-on-year in January from 1.1% in December. The lift was helped by energy prices which are up 8.1% year-on-year. Excluding energy costs, core inflation was steady at 0.9% year-on-year, in line with market expectations. In the United Kingdom, the legislation to allow Britain to trigger Article 50, the first step in its effort to leave the European Union, was approved by the House of Commons and Article 50 is expected to be triggered in March. Despite the ongoing uncertainty surrounding Brexit, the UK economy continues to perform better than expected with annual GDP growth rising 2.2% in the fourth quarter.

China

In China, December quarter GDP growth was better than expected, rising 6.8% year-on-year. However, the activity indicators in December were mixed.

Asia Region

In Japan, the Bank of Japan (BoJ) left monetary policy unchanged at its January meeting, as expected. The BoJ remains committed to buying Japanese Government Bonds (JGB) each month in an effort to keep the yield on the 10-year JGB at zero.

Australia

In Australia, recent economic data has been a little soft. The unemployment rate ticked up for the second month in a row; from 5.7% in November to 5.8% in December. In addition Australia’s December quarter CPI inflation came in below market expectations, rising 0.5% over the quarter and 1.5% year-on-year. Core inflation was also a little below expectations, rising 0.4% (0.5% was expected) and the annual rate of core inflation remained at 1.6%, which is still well below the RBA’s 2-3% target band.


The information contained in this Market Update is current as at 10/02/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

December Market Update 2016

The Pulse

  • In November equity markets were boosted by Donald Trump’s election victory as investors bet that his policies will be better for business and likely to lead to stronger US economic growth.
  • Oil prices rose 5.5% to US$49.41 per barrel (WTI) after OPEC and some non-OPEC countries agreed to cut production.
  • Chinese purchasing manager indices for both the manufacturing and non-manufacturing sectors rose to the highest levels since mid-2014.
  • The US economy continues to perform well with the unemployment rate falling to new post financial crisis lows.
  • Investor attention in the Eurozone was focussed on the Austrian presidential election and the Italian constitutional referendum.
  • Australia’s economy contracted in the third quarter largely due to wet weather but there are some other indicators that suggest that growth may be slowing.

Global economies

The unexpected election of Donald Trump as the next US President dominated news and financial markets in November, with the brief initial sell-off in equities turning into a rally in many of the major equity markets. Most economic data was, on the whole, relatively good showing that the global economy continues to be relatively healthy.

US

In the US, economic data during the past month has continued to be relatively strong.  There was an upward revision to third quarter GDP growth, now estimated at 3.2% annualised, helped by stronger consumer spending and corporate profit growth.

Europe

Although the European economy continues to perform relatively well, with moderate growth rates, falling unemployment and stronger business conditions, investor attention was focussed on political events such as the Italian referendum and French elections, which have the potential to destabilise the European Union. 

China

In China, economic indicators have continued to paint a picture of an economy that is performing relatively well.

Asia Region

Japanese economic growth continues to be relatively sluggish notwithstanding the significant stimulus from the Bank of Japan. Third quarter GDP growth came in at a relatively disappointing 1.3% annualised rate and retail spending contracted against year-ago levels.

Australia

In Australia, some recent economic indicators have suggested that the economy may be losing momentum. Australia’s third quarter GDP declined 0.5%, partly due to wet weather, but household consumption growth was disappointing.

 


The information contained in this Market Update is current as at 15/12/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

November Market Update 2016

The Pulse

  • In October equity and bond markets were both a little weaker as investors worried about higher US interest rates and the outcome of the US elections.
  • Crude oil prices were about 3% weaker as oil producer nations failed to agree to production cuts.
  • Chinese economic data was relatively good helped by infrastructure and housing construction activity.
  • The US economy continues to grow moderately with some evidence that wages growth is picking up.
  • The Eurozone economy continues to grow in line with long term trend rates and business sentiment in both the manufacturing and services sectors has improved.
  • Australia’s economy is still somewhat mixed with softness in retail spending and low inflation but the recent lift in iron ore and coal prices should help provide support into 2017.

Global economies

In another relatively uneventful month for economic data, investor attention was directed at rising interest rates and bond yields and election uncertainty in the United States.  Economic indicators were on the whole relatively good showing that the global economy continues to expand at a moderating pace.

US

In the United States, the initial estimate of third quarter GDP growth came in ahead of expectations showing annualised growth of 2.9%.

Europe

In Europe, economic indicators have been relatively good recently.  GDP growth in the third quarter was as expected, at 1.6% year-on-year.  However, purchasing manager indices for both the manufacturing and services sectors were better than expected.

China

In China, the economy grew at an annual rate of 6.7% in the third quarter, which was in line with expectations.

Asia Region

Japanese economic data continues to show an economy gripped by price deflation and consumers who are reluctant to spend.  Household spending fell 2.1% over the past year and core inflation is running at -0.5% nationwide, despite the unemployment rate falling from 3.1% in August to 3.0% in September.

Australia

In Australia, employment fell for the second consecutive month in September and the trend continues to show weakness in full-time employment partly offset by strength in part-time jobs.


The information contained in this Market Update is current as at 18/11/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

October Market Update 2016

The Pulse

  • In September equity and bond markets were dominated by investor concerns around the timing of the next US interest rate hike.
  • Crude oil prices rose 8% on talks from producer countries of possible cuts to oil production levels.
  • Chinese economic data continued to show that economic growth is being supported by strong housing construction and government stimulus measures.
  • The US economy is growing at a modest rate but the rate of employment growth has tapered off in recent months as the economy approaches full employment.
  • The Eurozone economy is performing in line with expectations but more recently investors have been concerned with the health of some of the banks, particularly in Italy.
  • Australia’s economy has been benefiting from strong housing construction and growth in the services sector but consumers have become more cautious in recent months.

Global economies

In what was a relatively uneventful month for economic data, investor attention turned to the timing of US interest rate rises while economic indicators over the past month have continued to point to a world that is growing – albeit at a moderating pace.

US

In the United States the economy continued to perform reasonably well – September’s non-farm payrolls report showing 156,000 jobs were created

Europe

Germany saw a very large rise in IFO business climate index as concerns over the UK’s Brexit decision receded. The Business Climate Index rose 3.2 points to a seasonally-adjusted 109.5 in September, the highest level since July 2014.

China

The economy continued to be supported by strong new home price growth and robust housing construction in the major cities.

Asia Region

Japanese economic data continued to show the economy is struggling to generate growth.  June quarter GDP growth was revised up to 0.7% annualised from 0.2% previously.

Australia

The economy continued to perform reasonably well, helped by the housing and services sectors – although employment fell by 3,900 jobs in August, which was weaker than expected.


The information contained in this Market Update is current as at 26/10/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

September Market Update 2016

The Pulse

  • Equities traded in a relative tight range in August but finished modestly higher.
  • Crude oil prices recovered 7.5% on talks of possible production freezes from OPEC and non-OPEC countries when they meet in late September.
  • China economic data was a little softer with declines in industrial production and retail sales growth.
  • US economic data was somewhat mixed. The July non-farm payrolls figure was better than expected which lead US Federal Reserve officials to begin talking about further interest rate rises.
  • Economic data in Europe was a little softer with the core annual inflation rate slipping from 0.9% to 0.8% in August.
  • Australia’s economy grew at the strongest annual rate in four years with growth of 3.3% year-on-year in the June quarter. However, household consumption growth was weaker while government spending much stronger than in the prior quarter.

Global economies

August was a relatively quiet month in terms of market moving economic data with most of the focus on Janet Yellen’s speech at the Economic Symposium at Jackson Hole and other commentary from US Federal Reserve officials, as to whether they would vote to increase interest rates once more in 2016.

US

In the United States, US Federal Reserve officials, discussed interest rate increases and this led the market to price in a 70% chance of a rate hike by December.

Europe

Despite the vote to leave the European Union, the UK economy has continued to perform better than expected.  Employment and wages growth were robust in the June quarter and the August services and manufacturing PMI surveys were relatively strong.

China

In China, the economy continues to be well supported by government stimulus measures although there was weaker growth in industrial production, fixed asset investment and retail sales in July.

Asia Region

The Japanese economy continues to lack momentum with a recent run of weak export, factory output and household spending data.

Australia

The economy continues to perform relatively well with June quarter GDP growth of 3.3% year-on-year, the highest annual rate of growth in four years. The result was boosted by government spending and companies investing in inventories, while household consumption growth slowed.


The information contained in this Market Update is current as at 21/09/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

August Market Update 2016

The Pulse

  • Following the sell-off in equities after the UK’s Brexit decision, equities staged a strong recovery in July, helped by expectations of more central bank stimulus measures in the major economies.
  • Crude oil prices fell 14% on renewed concerns about oversupply.
  • China economic data continued to show that the government stimulus measures are supporting the economy.
  • US economic data was somewhat mixed. June non-farm payrolls figures recovered from the very low reading in May but GDP growth in the second quarter was slower than expected.
  • Economic data in Europe has continued to be fairly good with moderate economic growth but recent business and consumer surveys in the UK point to a sharp slowdown in activity in the coming months.
  • Australia’s economy is in reasonably good shape with consumers and businesses finding conditions reasonably good but weak inflation and wages growth have prompted the RBA to cut interest rates again to 1.50% in early August.

Global economies

July was a strong month for equities as investors shrugged off the UK’s decision to leave the European Union and companies reported better than expected earnings in the US and Europe.  Over the month most of the economic data painted a picture of moderate economic growth, falling unemployment and strong housing construction activity

US

In the United States, non-farm payrolls rose by 287,000 jobs in June, reversing the very weak reading in May, and more in line with the 200,000 monthly average jobs over the past few years

Europe

The Euro area economy grew 0.3% in the June quarter, in line with market expectations. Annual growth in GDP did, however, slip marginally to 1.6% year-on-year from 1.7% in the prior quarter.

China

The economy continues to perform reasonably well, supported by government stimulus measures and construction activity.  GDP grew at 6.7% in the June quarter, slightly ahead of expectations.

Asia Region

Japanese economic data continues to show that the economy is struggling to generate growth. Industrial production is down 1.9% over the past year, real household spending is 2.2% lower over the past 12 months and inflation is still in negative territory.

Australia

The RBA announced a 25 basis point cut in Australia’s cash rate to a record low of 1.5 headline inflation in the June quarter was in line with market expectations.


The information contained in this Market Update is current as at 16/08/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

July Market Update 2016

The Pulse

  • After strong rises in equity prices off the lows in February, developed market equities were weaker in June, following the decision by voters in the UK to elect to leave the European Union (“Brexit”).
  • Gold prices rose 9% in June and crude oil prices were a little lower during the month.
  • China economic data showed further softness in the manufacturing side of the economy, but other areas such as the housing and services industries were stronger in June.
  • US economic data was fairly good, apart from the non-farm payrolls figures, which were the weakest since 2011.
  • Economic data in Europe was fairly good – particularly in the UK, Germany and France. Eurozone inflation continues to tick up and unemployment is gradually heading lower.
  • Australia’s economy is in reasonably good shape with consumers and businesses finding conditions reasonably good. Property prices have been rising strongly, helped by the RBA’s rate cut in May.

Global economies

It was a difficult month for equities with an initial sell off in June, after the release of weak jobs growth figures in the United States, and another decline later in the month following the UK’s surprise decision to vote to leave the European Union.

US

The initial reading of the May non-farm payrolls report was very disappointing with just 38,000 jobs created, well down on the 200,000 monthly average over the past few years.

Europe

The European economy continues to perform reasonably well. Core inflation continued to edge up, from 0.8% year-on-year in May, to 0.9% in June, and the unemployment rate fell from 10.2% in May to 10.1% in June.

China

The economy is performing in line with expectations. Manufacturing surveys showed flat to slightly weaker activity levels in June but the index of activity was stronger at non-manufacturing and services firms in June, when compared with May.

Asia Region

In Japan, the data has been mixed. Industrial production was weaker in May, by around 2.3%, but housing starts rose 9.8% year-on-year.

Australia

Employment growth has held up reasonably well and the unemployment rate remained steady at 5.7% in May. Other economic indicators such as the NAB business conditions index have also been reasonably strong compared with long term average levels. And house price growth has accelerated in recent months.


The information contained in this Market Update is current as at 13/07/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

June Market Update 2016

The Pulse

  • The recovery in equity and commodity prices from February lows continued into May with the third straight month of equity and commodity price rises.
  • Oil prices continued to move higher, up another 7% in May. Iron ore prices gave back their recent gains with a 24% decline over the month.
  • US economic data was fairly good leading to increased talk of impending rate hikes.
  • Economic data in Europe has been stronger-than-expected, although inflation remains low.
  • Australian growth was stronger than expected in the first quarter of 2016. However, pricing pressures in the economy are fairly low, reinforcing the RBA’s early May decision to cut official interest rates to 1.75%.

Global economies

Developed market equities rose further in May helped by marginally better economic data, stronger commodity prices and supportive monetary policies from the US Federal Reserve and European Central Bank.

US

In the United States, the unemployment rate fell from 5.0% in April to 4.7% in May and wages rose more than expected to be up 2.5% over the past year (compared to the same period to May 2015).

Europe

Core inflation ticked up a little – from 0.7% year-on-year in April, to 0.8% in May, and the unemployment rate remained steady. 

China

Data in the past month has been underwhelming. Manufacturing surveys showed flat to slightly weaker activity levels. Likewise, growth in industrial production, retail sales and fixed asset investment eased slightly. 

Asia Region

In Japan, first quarter GDP growth rose from -0.4% in the fourth quarter of 2015, to +0.4%, in the first quarter of 2016, which was better than expected due to stronger household consumption and stronger net exports. 

Australia

March quarter Gross Domestic Product (GDP) growth was stronger than expected. The Australian economy grew 1.1% over the quarter and 3.1% over the past year, which was the highest annual growth rate in three-and-a-half years.


The information contained in this Market Update is current as at 9/06/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

May Market Update 2016

The Pulse

  • The recovery in equity and commodity prices continued in April helped by reasonable economic data and commentary from central banks that implied interest rates would remain lower for longer
  • Oil prices continued to move higher, up another 20% in April. Iron ore prices rose 23% over the month
  • China growth figures were reasonably solid
  • US economic data was on-balance somewhat mixed, in part due to the stronger US Dollar which has hurt certain industry sectors such as exporters
  • Economic data in Europe has been stronger-than-expected, although inflation remains low
  • Australian business conditions and employment levels have remained strong, but inflation in early 2016 was very weak
  • RBA cuts the cash rate from 2.00% to 1.75%

Global economies

Developed market equities rose marginally in April helped by cautious commentary from the US Federal Reserve and European Central Bank and reasonable economic data in Europe and China.

US

The initial estimate of Gross Domestic Product (GDP) growth in the first quarter of 2016 was a little disappointing with annualised growth of just 0.5%, down from 1.4% in the prior quarter.

Europe

First quarter GDP growth came in at 1.6% for the year, which was higher than expected, with the Spanish economy continuing to grow strongly.

China

GDP growth in the March quarter rose to be 6.7% higher over the past year and there were stronger-than-expected rebounds in industrial production, retail sales and fixed asset investment.

Asia Region

In Japan, deflation pressures continued with the consumer price index falling 0.1% year-on-year in March pointing to deflationary pressures in Japan. 

Australia

The RBA reduced interest rates from 2.00% to 1.75% at its May meeting and March quarter CPI was much weaker than expected.


The information contained in this Market Update is current as at 12/05/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

April Market Update 2016

The Pulse

  • Equity and commodity markets continued to recover off their mid-February lows helped by reasonable economic data, supportive central banks and improved sentiment:
  • Oil prices continued to move higher, up another 13% in March
  • China economic data was, on balance, a little better
  • US economic data continued to improve
  • The European Central Bank surprised investors with the size of the additional stimulus measures that it announced in early March to try to combat disinflation
  • Australian business conditions outside the mining sector continue to improve
  • RBA retains cash rate at 2.0%

Global economies

Global equity markets continued to rise off their mid-February lows helped by a recovery in commodity prices, particularly oil, further monetary policy stimulus from the European Central Bank and commentary from the US Federal Reserve that downplayed the likelihood of further US interest rate rises in 2016.

US

In the United States, soft Gross Domestic Product (GDP) and Institute for Supply Management (ISM) manufacturing readings in late 2015, which had spooked investors in early 2016, have pleasantly surprised in recent months.  GDP growth in the fourth quarter was again revised higher, from an initial reading of 0.7% annualised, to 1.4% annualised.

Europe

As expected, the European Central Bank (ECB) introduced additional measures to combat deflation with the main surprise being the larger asset purchase program, up from 60 billion Euro to 80 billion Euro per month.

China

February data on the export side of the economy was weak with annual industrial production growth of 5.4% the weakest since November 2008 – but part of the slowdown was due to a large decline in tobacco production.  Additionally exports contracted by 25.4% in February compared with February last year.

Asia Region

In Japan the second reading on fourth quarter 2015 GDP saw the economy’s estimated performance revised to -1.1% annualised from -1.4% previously, thanks to a stronger than previously estimated uplift in business spending and, less positively, higher inventories.

Australia

The Reserve Bank of Australia (RBA) retained the cash rate at 2% at its April meeting. The RBA continues to monitor whether recent improvements in the labour market are continuing.


The information contained in this Market Update is current as at 12/04/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

March Market Update 2016

The Pulse

  • Global equity markets continued to correct through February but stage an early March recovery
  • Oil prices staged a strong recovery from mid-February – up 37%
  • China economic data continued to consolidate and targets 6.5% minimum growth
  • US economic data continued to improve
  • Marginally weaker Eurozone economic data heightens the likelihood of further quantitative easing
  • Australian non mining sector continues a solid recovery – improved Q4 GDP
  • RBA retains cash rate at 2.0%

Global economies

Global equity markets continued the December/January pullback with a further correction in February. However, late February/early March has seen improved global equity markets as oil prices staged a recovery and global corporate credit risk declined across the high yield energy and commodity company bond markets.

US

February US economic data indicates that the economy is continuing to expand.

The improved US economic data has been exemplified by the strong February payrolls data and the resilience behind the Institute of Supply Management (ISM) data.

Europe

The February manufacturing Purchasing Managers Index (PMI) was a little weaker than January’s data.

The Market manufacturing PMI index was down at 51.2 in February, from 52.3 in January.

China

The manufacturing PMI declined to 49.0 in February compared to 49.4 in January. The production index was 50.2 down from 51.4 in January.

Asia Region

In Japan, the February Market Nikkei manufacturing PMI came in at 50.1, compared to 50.2 in January.

The Nikkei services PMI was 51.2 compared to 52.4 in February.

Australia

The RBA retained the cash rate at 2% at its March meeting. The RBA indicated that it’s seeking to monitor the sustainability of the improvement in the labour market.  The RBA also indicated global volatility will have an ongoing impact on global and domestic demand.


The information contained in this Market Update is current as at 10/03/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

January Market Update 2016

The Pulse

  • Global equity markets correct in December – although Australia was a strong performer
  • Oil prices continue to weaken
  • China stock market volatility, and weaker economic data, creates deflationary fears
  • US economic data continues to point to an improved recovery.
  • US Federal Reserve commenced the process of normalisation of interest rates in December.
  • Eurozone economic activity continues to improve
  • Australian non-mining economic sector continues to recover

Global economies

Global equity markets corrected in December although Australia was up strongly and outperformed other markets.  Oil price declines have raised concerns of increasing corporate defaults, impacting global credit markets.

The US economy continues to improve although the manufacturing sector was weaker in December.  Whilst business conditions in the Eurozone and Japan improved.

US

In the US, although the economic data has been mixed, the overall economy remains in recovery mode. While the manufacturing and services data has been weaker in December, employment growth remains strong.

Europe

The December Market Composite PMI index came in at 53.2 compared to 52.8 in November. New orders and new export business all improved.

China

The significant news has been centered on the sliding share market, the Government interventions to control the falls in the market and the declining value of the Chinese currency.

Asia Region

Japan’s manufacturing activity in December continued the positive trend. New orders increased at a rate matching October’s one year high. This supported further expansions in output, employment and buying activity.

Australia

The Reserve Bank of Australia (RBA) will not meet until February and expectations remain that they will retain the current cash rate at 2%. The Australian economy continues to improve across the non-mining sector.


The information contained in this Market Update is current as at 21/01/2016 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

November Market Update 2015

The Pulse

  • Global equity markets staged a sharp recovery through October
  • China cut interest rates for the sixth time in 12 months
  • US economic data remains positive
  • US Federal Reserve provides clarity on interest rate increases
  • The ECB considering further quantitative easing
  • Australian business credit growth shows positive recovery
  • RBA maintains the cash rate at 2.0% at its November meeting and remains on an accommodative policy

Global economies

Following the August and September global equity market correction, a sharp recovery has been experienced in October.

US

In the US, economic data remains resilient with the economy growing at 1.5% (seasonally adjusted) in Quarter 3, 2015.  US corporate earnings growth remains steady at 0.7% and job creation is at its strongest since July.

Europe

The October composite PMI came in at 53.6 in September, down from 54.3 in August. Although the rate of growth has eased to a four month low, the Eurozone continues to have solid gains in output and new orders and growth continues to support job creation.

China

The China economy has experienced stabilisation over recent months. Manufacturing PMI remained at 49.8 in October, the same as September. The impact of infrastructure investment is expected to continue to be a stabiliser on the China economy over coming months.

Key announcements were centred on a further reduction in interest rates and the removal of the one child policy that was established in 1980.

 Asia Region

In Japan, manufacturing activity in October expanded at the fastest pace in 12 months, whilst the World Bank has forecast that India would be the world’s fastest growing economy and is relatively well positioned to weather the global volatility.

Australia

Australia’s CPI rose 0.5% in the September quarter with the most significant price rises in international travel and accommodation, fresh fruit and property rates and charges.

The RBA has once again kept the cash rate on hold at 2% at its November meeting.


The information contained in this Market Update is current as at 6/11/2015 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

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