Invest
Volatility looms, but don’t panic, investors told
Short-term event risks – including the Brexit referendum, the Spanish election, Australian election, US republican and democrat conventions – will only cause near-term uncertainties in markets, according to one leading Australian economist.
Volatility looms, but don’t panic, investors told
Short-term event risks – including the Brexit referendum, the Spanish election, Australian election, US republican and democrat conventions – will only cause near-term uncertainties in markets, according to one leading Australian economist.
AMP chief economist Dr Shane Oliver said that while the past week has been dominated by Brexit worries, which have pushed down most share markets, in the long term it is expected that shares will continue to trend higher this year.
Dr Oliver said this will be helped by relatively attractive valuations, ultra-easy global monetary conditions and continuing moderate global economic growth.
Brexit concerns over the past week have seen US shares drop 1.2 per cent, Eurozone shares lose 2.4 per cent, Japanese shares, which were also hit by the absence of monetary easing, fall six per cent, Chinese shares lose 1.7 per cent and Australian shares fall 3.7 per cent.
"The Brexit vote is fast approaching and nervousness in financial markets has been building over the last few weeks, particularly as the leave campaign – focusing on the more emotive topic of immigration – has been showing a lead over remain," he said.
The eight per cent fall in Eurozone shares, he said, is likely overdone, however.
While shares may fall a little further if the leave campaign wins, "Europe is likely to hang together as it did through its sovereign debt crisis", he said.
Although the polls have been in favour of the leave campaign, he still predicts a vote to remain.
In terms of bonds, Dr Oliver said lower bond yields point to a soft medium-term potential from them, but it is difficult to have a bearish outlook in a world of fragile growth.
"That said, the recent bond rally has taken bond yields to ridiculously low levels, leaving them at risk of a sharp snapback," Dr Oliver.
Capital city dwelling price gains are expected to slow to around three per cent over the year ahead, as the heat comes out of Sydney and Melbourne thanks to toughening lending standards and pockets of oversupply, he said.
"Prices are likely to continue to fall in Perth and Darwin, but price growth may be picking up in Brisbane."
Commercial property and infrastructure, on the other hand, are likely to continue benefiting from the ongoing search for yield by investors.
Stock market
Trading app popularity skyrockets as retail sector booms
In 2021, trading has never been easier for retail investors, meaning the number of users on trading applications has exploded to an all-time high. ...Read more
Stock market
ETF rush predicted to intensify
The Australian ETF sector advanced AU$6.3 billion in August to hit a new milestone, as its popularity among financial advisers soared. ...Read more
Stock market
The 6 unique Australian market affects that all active managers can exploit
The uniqueness of the Australian equities market is providing fund managers with an opportunity to essentially beat the market, new research has revealed. ...Read more
Stock market
‘Don’t believe the hype’: ASIC warns of risks for new market participants
ASIC has expressed concern that inexperienced or uninformed investors are putting their capital at unnecessary risk when tempted into the market by questionable marketing strategies from market promot...Read more
Stock market
How do you choose the best ETFs?
In recent years, exchange-traded funds have become an increasingly popular option among Aussie investors. ...Read more
Stock market
Lockdowns instigate a rise in new investors
Despite COVID-19 leaving individuals and businesses to face an uncertain future, retail investors’ appetites for shares have increased throughout the pandemic, a new report has found. ...Read more
Stock market
‘Code red for humanity’ a wake-up call for private and public investment
Retail investors that have been advocating for sustainable and ESG investing are hoping a new report released by the United Nations will serve as a wake-up call to the financial industry and governmen...Read more
Stock market
Rising inflation set to help the next super cycle for investors
Central banks around the world are largely tipped to increase interest rates over the medium term due to inflationary pressures, with investors urged to look at the upcoming growth cycles that will em...Read more
Could property prices inflate by another 20%? What’s happening in recent dividend announcements? Did your fund fail the YFYS test?
Listen now
What does the NSW regional permit mean for property investors? Who really wins from the BHP-Woodside merger?
Listen now
The sea and tree-change norm; Square’s acquisition of Afterpay; Why you should think twice before turning to TikTok for advice
Listen now
The Olympic effect on property and equity investors; COVID-19 Disaster Payments and super
Listen now
Stock market
Trading app popularity skyrockets as retail sector booms
In 2021, trading has never been easier for retail investors, meaning the number of users on trading applications has exploded to an all-time high. ...Read more
Stock market
ETF rush predicted to intensify
The Australian ETF sector advanced AU$6.3 billion in August to hit a new milestone, as its popularity among financial advisers soared. ...Read more
Stock market
The 6 unique Australian market affects that all active managers can exploit
The uniqueness of the Australian equities market is providing fund managers with an opportunity to essentially beat the market, new research has revealed. ...Read more
Stock market
‘Don’t believe the hype’: ASIC warns of risks for new market participants
ASIC has expressed concern that inexperienced or uninformed investors are putting their capital at unnecessary risk when tempted into the market by questionable marketing strategies from market promot...Read more
Stock market
How do you choose the best ETFs?
In recent years, exchange-traded funds have become an increasingly popular option among Aussie investors. ...Read more
Stock market
Lockdowns instigate a rise in new investors
Despite COVID-19 leaving individuals and businesses to face an uncertain future, retail investors’ appetites for shares have increased throughout the pandemic, a new report has found. ...Read more
Stock market
‘Code red for humanity’ a wake-up call for private and public investment
Retail investors that have been advocating for sustainable and ESG investing are hoping a new report released by the United Nations will serve as a wake-up call to the financial industry and governmen...Read more
Stock market
Rising inflation set to help the next super cycle for investors
Central banks around the world are largely tipped to increase interest rates over the medium term due to inflationary pressures, with investors urged to look at the upcoming growth cycles that will em...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
