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Investor Signposts: Week Beginning 19 October 2020

Australia: Reserve Bank Board minutes, Deputy Governor speech and retail trade data in focus In Australia over the coming week, the highlights are a speech from the Deputy Reserve Bank Governor and the preliminary retail trade report. The Reserve Bank’s Board minutes will be heavily scrutinised for clues about a potential interest rate cut. The…

The budget tax cuts make fiscal sense

This year’s budget is something of a play in two acts. Act one involves large economic stimulus to help plug the hole in output generated by the coronavirus pandemic. Act two tries to set Australia up for a bounce back in economic growth and employment that involves more than just waiting for the pandemic to…

Keating is right the RBA should do more

Former prime minister Paul Keating isn’t alone in wanting the Reserve Bank to do much more to ensure economic recovery. In an opinion piece for major newspapers he has said it ought to be directly funding government spending rather than indirectly by buying government bonds from third parties. But we think there’s something else the…

Under the Radar Small Cap Stocks Making Big Moves

The famous quote appearing in the investing classic “One Up on Wall Street” from history’s greatest fund manager Peter Lynch bears repeating in today’s market conditions: “Big Companies Have Small Moves; Small Companies Have Big Moves.” Since the US Dow Jones Industrial Average (DJIA) often sets the tone for Asian markets, market performance so far…

Seeking yield amid economic turmoil

In March this year, COVID-19 saw the Australian economy grind to a halt and the ASX plunge over 35% in just over a month. The response of central banks in Australia and around the world has been swift and overwhelming – flooding markets with trillions of dollars of bond purchases, sending share prices soaring. For…

Near-zero rates expected through 2023

The Federal Reserve announced no major policy changes but did unveil its new forward guidance at the September Federal Open Market Committee (FOMC) meeting, as expected. The projections and the tone of the statement sent a dovish message, signalling that rates will stay near zero through 2023 – amid expectations that inflation will remain below…

Why gold is still a safe haven in times of crisis

“Gold” said famed investor Warren Buffett in 1998, “gets dug out of the ground in Africa or someplace, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.” Yet for all that, we…

Investor Signposts: Week Beginning 21 September, 2020

Australia: Mixed statistical offerings · In the coming week, there will be a mixed array of new data, survey results and speeches. · The week kicks off on Tuesday when Reserve Bank Deputy Governor Guy Debelle gives a speech –“The Australian Economy and Monetary Policy” – at the Australian Industry Group conference at 10.30am AEST….

What do Australian investors do in times of market volatility?

Coronavirus brought a decade-long US bull market to a halt and sparked a sudden stock market collapse. We analyse the findings of the Schroders Global Investor Study to understand how Australian investors responded to market volatility compared to their global counterparts. Faced by of one of the biggest economic shocks in history, it is little…

Investor Signposts: Week Beginning 14 September 2020

Australia: Monthly job statistics in focus In a rare tame week for key economic data it is Thursday’s job figures that clearly stands out. But the week kicks off on Monday when the Australian Bureau of Statistics (ABS) issues provisional data on overseas travel during August. Borders are closed except for exceptional circumstances. Also on…