Trends & Opportunities

Goldilocks And The Bears

Thoughts from the Melbourne fixed income desk Investors like narratives. They serve a dual purpose of explaining past performance, and justifying current portfolio positioning. Narratives also complement consensus estimates of growth, inflation and interest rates, by offering insights into cross currents and underlying drivers. The narrative on global interest rates has reversed course over the…

Investor Signposts: Week Beginning July 15 2019

CommSec Senior Economist Ryan Felsman previews the economic & financial market events scheduled for the week ahead including the June employment report, NAB business survey & US Retail sales. Australia: Jobs data dominates • In the coming week there is little in the way of top-tier economic data. But the all-important June employment report will…

Central Banks Running Out of Levers to Pull

The decision by the RBA to cut rates to a new historic low of 1% officially puts Australia in the low rates club, but can the push by central banks to lower rates stabilise global growth? Extreme events – either recession or a sharp uptick in growth – seem unlikely in the near term. Economies,…

Telco Stocks on the Rebound

Regardless of their investing philosophy, most retail investors are interested in growth. Income investors know without growth dividend payments are at risk. Value investors know without growth the company’s intrinsic value will decline. Growth investors prefer companies that reinvest profits in growth opportunities rather than in dividend payments. The principal means companies have at their…

Monetary Intervention Isn’t Quite Going To Plan

As interest rates approach zero in much of the western world, the linear relationship which economists expect from their monetary intervention isn’t quite going to plan. Rather than igniting animal spirits and spurring spending, declining rates are creating insatiable demand and stratospheric prices for safe haven assets whilst doing nothing for the velocity of money…

2019 Losers Poised for a Comeback

Retail Investors who take pride in calling themselves “stock-pickers” are constantly on the lookout for picks. Twice a year they are treated to the annual delight of listings of best and worst ASX performers for the trading year, ending on or about 31 December, and for the fiscal year, ending on or about 30 June….

Gold’s Incredible Summer Strength

Gold’s incredible strength this summer is very unusual, as early summers are the weakest times of the year seasonally for gold, silver, and their miners’ stocks. With traders’ attention diverted to vacations and summer fun, interest in and demand for precious metals normally wane. So this entire sector tends to suffer a seasonal lull, along…

The Battle Of The Bays – China’s Urban Ascent

In the “battle of the bays” featuring locations such as Tokyo, New York and San Francisco, our money is on China’s Greater Bay Area becoming the pre-eminent economic region in the world. The most productive urban locations in the world are found in bay areas, for example Tokyo, San Francisco and New York. Now, there…

The Case For Small To Mid-Caps

If you research Australia’s largest listed companies, you’ll discover that some of them were much smaller stocks not that long ago. Small or medium companies can be overlooked, given they’re often considered riskier than their large cap peers. Yet historically, investors have been rewarded for additional risk with superior long-term returns. What are small and…

Gold Mining Stocks Blasting Higher

The gold miners’ stocks just blasted higher to a major decisive breakout this week! Driven by gold’s own huge bull-market breakout, the gold stocks surged well above vexing years-old upper resistance. The resulting new multi-year highs are a game changer, starting to shift long-apathetic sector sentiment back towards bullish. This will increasingly attract back traders,…