Our Financial Advisor team love working with our clients and at a high level some want to understand the impact in our economy both domestic and abroad on Investment markets. With geopolitical tension always in the backdrop which we have seen this last week, markets don’t always act the way that the experts expect.
The month of October saw
- The RBA chose not to lift rates at the October meeting (November we were not so lucky) as it gave itself more time to assess the impact of the four percentage points of interest rate hikes delivered since May 2022.
- Global equity markets dropped a further 2.9% per cent in October taking the year-to-date return to a positive 8.2 per cent. Interestingly in AUD terms the 12-month return is 15.88%. Bond yields continued to climb, undermining valuations while the Israel-Hamas conflict added to uncertainty and risk aversion.
- The Australian equity market lost 3.8 per cent in the month and is now down marginally for the year to date. Healthcare stocks sold down 7.1 per cent, while financials and REITs were down 3.7 per cent and 5.7 per cent, respectively.
- Global bond yields continued their march higher in October, against the backdrop of a more resilient economy. Australian bond yields sold off more aggressively than their US and global counterparts, as markets priced in another RBA tightening in November following the higher-than-expected September quarter CPI result
Key local economic releases this last month include:
- Australian Inflation for September quarter rose 1.2% for both headline and Core inflation – slightly above expectations.
- Unemployment dropped to 3.6% from 3.7%, with underemployment rate lifting to 6.4%.
Key item to look out for this coming month is what happens to rates again in early December – will they double up on what happened in November?
The full market update can be read here.
If you have any questions regarding this update please contact a Boutique Financial Advisor for a chat 08 9381 8779 or visit our website & send us your details.