The first quarter equity market rally continues into April in light of dovish Central Banks and improving Chinese data, while cuts to Germany’s growth forecast reverberates concerns around Eurozone weakness.
Uncertainty over US monetary policy, US-China trade relations, the wavering strength of the EU economy, and oil price were in focus during November, further impacting market volatility and the direction of major equity market indices.
Led by US and Asian markets, world markets roared into the New Year, although late in the month, caution crept back into markets after one of the best starts to a year in recent history. It was the best start to a year for the broad US benchmark, the S&P 500 index, since 1987.
From its Paris headquarters, the Organisation for Economic Co-operation and Development (OECD), the peak body for Australia’s peer-group of developed nations, recently weighed in on Australian residential property saying the market could be headed for a significant collapse in house prices that could lead to an economic downturn.
Both the global economy and financial markets are tracking towards their best year since the initial rebound from the 2008–09 global crisis. All this has been despite a more fractious, and unsettled political backdrop.
US equity markets pushed higher in November on the back of solid corporate earnings and synchronized global economic growth, although the European markets retreated in November after two straight months of gains, and the UK stock market fell in November as continued uncertainty in domestic politics outweighed confidence in the UK's economic outlook.
Markets were mostly stronger in October, contradicting investors’ fears that the month of October historically has a predisposition to the negative. Economic data continued to improve in the US, Europe and Japan, while political events in China, Japan and Europe also held markets’ attention but synchronised global economic growth and improving company profits continued to be the driving themes.