Global equity markets remain challenging at present with valuations continuing to bounce around record highs. A large part of the remarkable performance of equity markets in recent months has been stimulus overkill. However, the stimulus story is itself close to a peak and households will soon be in a position where their spending power will sequentially decline.
Click here to read the article.
COVID-19 and the ‘Great Lockdown’ generated an unprecedented shock to the global economy. It also triggered an equally unparalleled policy response. The monetary support has been more than matched by fiscal measures. At last count over US$9 trillion of fiscal spending has been committed globally.
Click here to read the article.
The macro environment is rapidly changing as health concerns ease faster than expected and economies emerge from hibernation. While overall equity market valuations appear challenging there are a range of sectors that will benefit from this next phase.
Click here to read the article.
COVID-19 is having an unprecedented global impact. The contraction in activity will be bigger, and more concentrated than the GFC. Labour market scarring coupled with the structural imbalances point to a drawn-out recovery.
Click here to read the article.
There have been some interesting developments over the past week on some of the issues that we have been watching, particularly infection rates in Italy and the policy response.
Click here to read the article.
The infection from coronavirus is steadily spreading across asset classes. Currency and bond markets were the first to respond, and equity markets turned this week. Commodity markets and credit still appear to be complacent.
Click here to read the article.
Valuations for the Australian market have reached extremes. The forward Price Earnings Ratio for the overall market has only been higher at the peak of the tech bubble in 1999 and valuations have never been higher compared with the US.
Click here to read the article.
The Australian market hit record highs in terms of index points while valuations, using forward price to earnings ratio (PE) as a proxy, jumped above 17x for the first time since 2001. This is occurring at a time when earnings pressure is intensifying.
Click here to read the article.
We have entered another period where event risks are heightened and appear set to dominate market outcomes over the rest of the year. Equities have a better relative valuation than bonds and represent the only major asset class where investors have the potential to make decent returns on capital over the next years in our view.
Click here to read the article.
The recent combination of weak economic data and a dismal reporting season has focused attention back on the Australian market, and valuations in particular. Pressures on the economy may not improve, as further weakness in housing construction appears on the horizon.
Click here to read the article.