Market Commentary

  • SUMMER ROUND-UP 2017

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    The children are back at school, it’s getting darker and you’re starting to think about the central heating. Summer is drawing to a close and we thought it might be interesting to reflect on some key events over the last few months – and see if they give us an idea of what might happen in the run up to Christmas… These notes were written on Monday...
  • The Consensus View

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    With the hung parliament following the UK election result - it turns out that there isn’t a consensus view!   But perhaps what the UK now has is a parliament that better reflects more of the views of the UK people, a generally well diversified bunch.  So what does this mean for investment markets? When you take a much wider view, considering the gl...
  • Remember this?: “RBS advised clients to brace for a ‘cataclysmic year’ ” (Telegraph 11 January 2016)*

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    It is an inescapable fact that all investment advisers must take a view on the future. Even a simplistic approach of avoiding ‘fund managers’ and using stock market index tracking funds relies on a view that stock markets will out-perform everything else in the long run. When RBS predicted a cataclysmic year for 2016, with US and EU markets predict...
  • LOOKING BACK AT 2016: LOOKING FORWARD TO 2017

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    These notes were written on Monday 12th December, and all the information is accurate at that date: where quoted, stock market figures are as at 30th November. 2016 is a year that has seen some remarkable developments, but surely on 12th December we are now safe to look back over the year: nothing else can happen in the last two weeks of the year....
  • How’s global growth doing?

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    The International Monetary Fund (IMF) recently published its ‘World Economic Outlook’ report which suggests that whilst global growth in 2016 has been substandard, this is set to improve somewhat during 2017. The IMF’s report states that stifled global growth this year has been caused largely by the Brexit vote and the economic slowdown in the US,...
  • COMMENTARY: DONALD TRUMP RECEIVES MANDATE TO “MAKE AMERICA GREAT AGAIN.”

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    “While this US election was supercharged emotionally driving down the financial markets, stock valuations are based on earning per share and other fundamental business factors. It's likely, based on the recent impact of the British vote to leave the EU which had a similar downward impacts on the global stock markets, that the Markets will recover o...
  • “Brexit means Brexit.” But what does that really mean?

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    Introduction As everyone now knows, David Cameron’s promised referendum on the UK’s continued membership of the European Union was held on Thursday 23rd June. It resulted in a win for the ‘Leave’ campaign, with 51.89% of the votes cast. More than 17m people voted to leave the EU, with just over 16m supporting ‘Remain’. David Cameron duly fell on h...
  • This summer’s market trends insight - from Investec

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    Sterling fell sharply immediately after the UK’s 23 June vote to leave the EU. GBPUSD slumped from $1.49 the day of the Brexit vote to $1.32 the following Monday. We think that the decline reflects two factors. First, heightened uncertainty about the UK’s future economic relationship with the EU has raised the risk premium associated with UK assets...
  • Brexit the Movie...

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    Sliding Doors Yesterday we saw a rising pound and markets shored up by polls indicating that Remain was likely to prevail.  Then, like the plot in “Sliding Doors”, an alternate reality took over.  The vote to Leave sent markets sliding, the pound tumbling and the movement was all the more extreme because of the about-turn from last minute polls to...
  • The financial implications of Trump vs. Clinton

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    No matter what your personal feelings about those currently battling it out to be the 45th President of the United States of America, there’s no doubt that this campaign year will be remembered as one of the most unusual and unpredictable in history. Although the election won’t have a direct impact upon the UK, it’s fair to say that all eyes are li...
  • Davos 2016: what you might have missed

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    The 46th Annual Meeting of the World Economic Forum took place from 19th January for four days in Davos, Switzerland. The main agenda was entitled “Mastering The Fourth Industrial Revolution”, with many of the delegates discussing the impact of rapid technological shift on many industries. The mood was uncertain – some might even say gloomy – with...
  • No Sign of Recession in the Data

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    If you are a market-watcher, you know the S&P 500 is down around 9% since the beginning of the year and has been down as much as 10.5%. As investors watch their accounts, the fear is always TWICE as significant as any euphoria over gain. This is the investor’s dilemma. How to fight the urge to cash in your chips and run for the hills. But this...
  • February Market Commentary

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    Twelve green bottles, standing on the wall Twelve green bottles, standing on the wall And if one green bottle, should accidentally fall… Yes, yes, we know the song is really ‘ten green bottles,’ but in January 2016 the world’s leading stock markets resembled nothing more than the row of proverbial bottles. As one fell, so they all fell – with one...
  • Stormy Markets

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    Stock markets have been stormy of late, with relatively large changes in values on a daily basis.  At the time of writing we have seen three consecutive days of falls. The headlines are all about market falls, but what is really going on? The real answer, is that nobody knows for sure.  When you look at charts of investment returns in the past it i...
  • The Old Year

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    The Arab Spring is turning into an Islamic Winter for the middle east, with some added cold wind, reminiscent of the Cold War. Russia and Iran are seemingly aligned against a US-backed Saudi Arabia and Turkey. The intricacies of the religious, political, military, and historical events taking place are complex to say the least. “Outrageously unstab...
  • November Market Commentary

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    Introduction Well, what a splendid month October was, with all the major world stock markets that we cover in this Bulletin skipping merrily upwards. Germany and China led the way with gains of 12% and 11% respectively, and if you only looked at the figures you’d be quite justified in thinking that everything in the world economic garden was rosy....
  • October Market Commentary

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    The end of September, and the end of the third quarter of 2015 – a quarter which, as all the financial press reported, was the worst for global equities since 2011. As CNBC put it: A sustained collapse in commodity prices, China’s stunning market rout followed by its shocking currency devaluation as well as fears of a Greek default and a US interes...
  • Path Sensitivity in Investing

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    There are many ways of viewing the performance of investments.  For example, we could compare the returns against an objective benchmark such as the FTSE 100 or the S&P 500, we could compare to a target return, or we could adjust the returns to take into account the risks taken.  However, the recent volatility in stock markets has highlighted t...
  • Are Company Strategic Reports helpfully forward-looking for investors?

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    Strategic reports provide ‘very little insight’ into future prospects. Many strategic reports contain a mass of annual data and text, which is largely backward looking, finds a PriceWaterhouse (PwC) study. Information disclosed in companies’ annual reports is being buried in a mass of annual data and text, presenting investors with a tough challeng...
  • The Chinese is Stock Market is Growing Up Painfully

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    When the physical growth slows and intellectual development reaches a peak, it can be a difficult time. As the father of a number of teenagers, I have found that the frequent, manageable toddler tantrums passed with relative ease. A few years pass, and then all of a sudden I am hit with a teenage tantrum, which can send shockwaves (particularly sin...
  • September Market Commentary

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    Introduction “Markets can fall as well as rise…” Never was that statement more true than in August, when virtually all the major world markets headed down, led by the plunging stock market in China. It became virtually impossible to watch a news bulletin without seeing a shell-shocked fund manager or a weeping private investor. It is, however, impo...
  • August Market Commentary

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    July was a dramatic month. Greece held a referendum and emphatically rejected the austerity package offered by its creditors. Motor-cycle riding Finance Minister Yanis Varoufakis resigned,  calling the creditors “terrorists”, and the new finance minister, Euclid Tsakalotos, was seen going into yet another final, final crisis meeting with his negoti...
  • July Market Commentary

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    An essential part of writing this bulletin each month is making daily notes on the main business and stock market news. This month we have comfortably broken our record – more than six pages of notes. And as you might expect, about half of those pages are about Greece and its debts. ‘An agreement was in sight’ on the debt repayment – but then the f...
  • Market Commentary from Guy Baker

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    There are three things going on in the markets right now. First, most of us know that long term performance smooths out short term volatility. By definition, weekly, monthly, or quarterly data will always be more volatile than the long term trend. Go back to the 1980s or 1990s, when real GDP growth was 4%, a “slow” quarter was 2%. But today, our Pl...
  • Stock Market Falls – October 2014

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    On 3rd September this year, the FTSE 100 index briefly touched 6,898.62: this was within 52 points of the all-time high of 6,950 reached in the final trading session of 1999. Since then the FTSE has fallen significantly. At the time of writing this update, it stands at 6,367 – down more than 500 points (nearly 8%) from September 3rd. Not surprising...
  • 10 Financial tweeters to follow

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    We’re always here to talk through your financial plans but whilst we manage your money, on a day-to-day basis you might want to keep on top of the markets, or hear about the latest goings on and changes in the investment industry. For that, there are some great experts out there who you can follow on twitter and learn a little more about the financ...
  • 9 Financial blogs to further your knowledge of finance

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    If you are seeking to gain some further insight into world finance and the UK economy, or just want to delve deeper into factors that could affect your personal financial position, then it is likely that there is a financial blog out there for you. To help you to discover some of the best, we have compiled a list of the top ten most informative, a...
  • Where do we go from here? Greece, the Eurozone and the future of the British Economy

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    I was never a fan of Mr. Brown as either Chancellor or Prime Minister, but he must be given enormous credit for one decision and that was to persuade Mr. Blair to drop the idea of Britain joining the Euro. I agree with the general consensus amongst political commentators and financial journalists that this will now never happen (or, at least, not i...