Market Highlights, Onwards and upwards
- Global growth indicators continued to firm through November as inflation expectations rose on the back of higher levels of industrial activity.
- Share markets, especially US small companies, staged a late recovery in the month following Donald Trump’s victory as his promise of expansionary fiscal policies lifted confidence and growth prospects.
- Investors have continued to sell bonds, with yields rising in anticipation of higher growth and inflation. The USD also strengthened to a one year high and the AUD fell, which helped boost unhedged returns.
- Emerging market shares and bonds were negatively impacted by tighter financial conditions and Trump’s anti-trade rhetoric.
- In China growth remained steady following an increase in coal production. Bulk metal prices fell from their peak but still remain high. A surprise announcement from OPEC on oil cuts resulted in a strong surge in energy prices.
- Australian economic indicators slowed in the month as the sharp fall in construction work completions and dwelling approvals hinted at a slower rate of GDP expansion in Q3.
Major asset class performance (%)
| Asset classes | 1 month | 12 months | 5 years (p.a.) |
| Australian Shares | 2.8 | 10.1 | 10.4 |
| Global Shares (hedged) | 2.8 | 5.0 | 14.7 |
| Global Shares (unhedged) | 4.5 | 0.9 | 17.6 |
| Global Emerging Markets (unhedged) | -1.8 | 6.4 | 7.9 |
| Global Small Companies (unhedged) | 7.5 | 5.1 | 19.6 |
| Global Listed Property | -1.8 | 3.2 | 13.4 |
| Cash | 0.1 | 2.1 | 2.8 |
| Australian Fixed Income | -1.4 | 3.4 | 5.2 |
| International Fixed Income | -1.6 | 4.8 | 6.5 |
| Source: JP Morgan & ANZ Wealth, 30 November 2016. Indices: Australian Shares – S&P / ASX300 Accumulation, Global Shares (hedged/unhedged) – MSCI World ex Australia, Global Emerging Markets – MSCI Emerging Free Net in AUD (unhedged), Global Small Companies (unhedged) – MSCI World Small Cap ex Australia, Global Listed Property – FTSE EPRA/NAREIT Developed Rental Index ex Australia (hedged), Cash – Bloomberg Bank Bill, Australian Fixed Income – Bloomberg Composite Bond All Maturities, International Fixed Income – Barclays Global Aggregate Bond Index (hedged). Please note: Past performance is not indicative of future performance. | |||
Currency
| Asset classes | At close on 30/11 | % change 1 month | % change 12 months |
| A$/US$ | 0.73 | -2.9 | 2.2 |
| A$/euro | 0.70 | 0.6 | 1.9 |
| A$/yen | 84.53 | 6.0 | -5.0 |
| Trade weighted index | 65.3 | 0.5 | 5.6 |
| Source: Bloomberg & ANZ Wealth, 30 November 2016. All foreign exchange rates are rounded to two decimal places. Please note: Past performance is not indicative of future performance. | |||
Disclaimer: This information is current as at 6 December 2016 but is subject to change. This information is issued by OnePath Funds Management Limited (OFM) ABN 21 003 002 800 AFSL 238342. OFM is a wholly owned subsidiary of Australia and New Zealand Banking Group Limited (ANZ) ABN 11 005 357 522 but is not a bank. The information is general in nature and does not take into account a potential investor’s personal needs, objectives and financial circumstances. This information is not to be construed as investment or financial product advice, and should not be relied upon as a substitute for professional advice. Before acting on this information, potential investors should consider the appropriateness of the advice, having regard to their objectives, financial situation and needs. Potential investors should read the relevant Product Disclosure Statement (PDS) available at onepath.com.au and consider whether the particular product is right for them. Although all the information in this document is obtained in good faith from sources believed to be reliable no representation of warranty, express or implied is made as to its accuracy or completeness. Past performance is not indicative of future performance. The value of investments may rise or fall and the repayment of subscribed capital is not guaranteed.