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Month in Review

August 3, 2016
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Month In Review – July 2016

By | Investing, Month in Review

The Market Wrap

Oil Sinks Into Bear Market as biotech elevates NASDAQ

During the month of July Crude oil sank into a bear market, falling below $40 a barrel for the first time since April amid renewed concerns over a supply glut. Energy producers continued to underperform the global equity rally, while emerging-market equities jumped to their highest level in almost a year.

Oil has traded 22 percent below its June high as Saudi Arabia cut prices to Asian customers and U.S. drillers boost rigs for a fifth week, fueling angst a global surplus will worsen. The S&P 500 Index has had an exceptionally strong month as it breaks to new highs, while biotechnology shares advanced.

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July 1, 2016
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Month in Review – June 2016

By | BREXIT, Economics, Investing, Month in Review

The impact of Brexit will not be understood for a few years but the initial signs are quite encouraging with markets having bounced strongly this week.  On Saturday morning all of the commentary was that we had entered a new world called “post Brexit” and that the good old years of “Pre Brexit” were behind us…. but then again that was just the media and they must hold some responsibility for this whole exercise. One can only imagine some of the diatribe written in the Sunderland Gazette playing on peoples fears carrying stories on immigration but being lazy on the economic impacts if a YES Vote.

As we’ve seen in the last couple of days, markets tend to look through the headlines and focus on the future.  While the impact of the Brexit is still very much unknown, the impact is unlikely to be anywhere near as bad as the media was playing it up to be.  It was interesting to see one of Australia’s best investors, Hamish Douglas of Magellan, say yesterday that he believed there was a 25% chance that the UK does not leave the UK despite the referendum.  All we know is that this is going to be a very long drawn out process.

Bloomberg British pound index and the effects of Brexit – 12% fall intraday

Brexit Pound

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June 2, 2016
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Month in Review – May 2016

By | Investing, Month in Review

The month of May did not see any of the theatre that was anticipated, in fact there was a sense of calm over the markets and the general feeling was that everything was alright. This transpired to a 2.6% return for the index and a drop in volatility to long term lows.

The most significant moment of the month came when Federal Reserve Chief Janet Yellen said in a speech at Harvard University “the time was right to gradually and cautiously increase our overnight interest rate over time, and probably in the coming months such a move would be appropriate. The economy is continuing to improve … growth looks to be picking up”.

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April 7, 2016
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Month in Review – March 2016

By | Economics, Investing, Month in Review

Market Wrap

With the risk of repeating myself, the month of March saw the market push up, get nervous and then push lower again. One would never like to get ahead of themselves and say that this market is becoming predictable but the simple fact is we can’t seem to find a catalyst to push higher or lower.

This isn’t a problem but the simple fact is, that after enduring a terrible year on equity markets in 2015 we still haven’t bounced back and continue to trade in the lower end of the trading range. With every major pullback since the GFC we have had a V shape recovery but the market seems content to play the waiting game, mind you an erratic one.

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