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Resist today, relax tomorrow
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Market Update 30 September 2019
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How much superannuation is enough?
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All Australia's vital statistics - October 2019
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6 new financial videos
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DGP by country since 1800
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Boost savings with compound interest
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High times for low interest rates
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Market Update - September 2019
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Will the world slip up on oil again?
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Australia by the numbers - September 2019
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Spending money in a cashless world
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Saving for a rainy day
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Market update
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Access to more resources and tools than most websites.
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Nine reasons why recession remains unlikely in Australia
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Can I go back to work if I’ve accessed my super?
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How's Australia doing statistically?
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Protecting your super package.
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Making the most of record-low interest rates.
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Market Update 2019
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How the top 10 global companies have changes since 1998
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The longest US economic expansion ever
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When can I access my super
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Australia by numbers – Update
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How to retire early
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How to play catch up with your Super
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Inflation undershoots in Australia
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9 money mistakes to avoid in retirement
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What a financial planner does to help.
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Australia's vital statistics.
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What kind of money parent are you?
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How to save money
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Federal Budget 2019 - Overview
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How the 2019 Federal Budget affects you
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New Global growth slowing, plunging bond yields & inverted yield curves
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Women and Money
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Market Update - March 2019
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The problem with getting to 53 years of age.
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How to avoid a travel debt hangover
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Things to avoid as a newbie investor
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Budget Time - How's Australia going?
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Most older Aussies prefer home care over a nursing home
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Why growth in China is unlikely to slow too far
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10 money conversations to have when your relationship heats up
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Australia slides into a 'per capita recession'
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6 steps to get your money stuff together
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All you need to know about how Australia is going.
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Australian housing downturn Q&A
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6 ways to reduce your credit card debt once and for all
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5 life insurance questions you've always wanted to ask
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2019 a list of lists - regarding the macro investment outlook
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Part 4 - The major benefit of ‘behavioural coaching'
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How to adult—a quick guide to personal finances in your 20s
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How Australia is performing.
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The Australian economy in 2019
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Holiday budgeting tips— How to avoid a travel debt hangover
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Australia - a comprehensive run-down of our vital statistics.
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The Fed and market turmoil - the Fed turns a bit dovish but not enough (yet)
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12 ways to avoid waste this Christmas
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Rising US interest rates, trade wars, the US midterm election results, etc
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Our Advent calendar for 2018
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Responsible and ethical investing
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What are the 3 biggest living expenses for households?
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Your Adviser and Behavioural Coaching
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Stop!! Don't do a paper Budget, use our online budgeting tools instead.
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Information needed to be the BBQ expert.
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Would you like to retire by 40?
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The property cycle and the economy
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How financial advice helps create wealth.
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7 money personalities you may identify with or want to avoid
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Are shares expensive?
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How's Australia doing statistically?
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Super investment options – what’s right for you?
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Here's how to lead a happier life
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What happened to all the worries about rising inflation and bond yields? Goldilocks, tariffs, Turkey & other things
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Is it better to buy an investment property or home first?
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Nine keys to successful investing
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This information will turn you into a fireside expert.
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How Australians will use their tax return
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Lessons from the blue zones: secrets of a long life
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Trumponomics and investment markets
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Tools for budgeting, cash flow, Super and more ….
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How much super should I have at my age?
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How tax deductible personal super contributions work
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The rise of the gig economy and side gigs (thanks to technology)
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Statistics for all Australians
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Watch out for tax scams
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After the Australian household debt and east coast housing booms
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Now’s the time for tax planning
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Why it pays to contribute to your partner's super
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Australia by numbers – Update
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How to deal with financial stress – nearly 1 in 3 affected
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Federal Budget 2018 – Overview
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Your Budget
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4 components of our 2018 Federal Budget
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US China trade war fears – Q & A
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Tools to help you manage your financial position are available on our site.
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7 ways to boost your super
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Australians reveal their priority goals
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Australia by numbers – Update
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Your retirement questions answered
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How to make money by turning your unwanted goods into cash
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Our website is really our digital office.
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Bitcoin – is it really for you?
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Spread your money, reduce risk
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Love and money? It’s not about control
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The pullback in shares - seven reasons not to be too concerned
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Australia. All you need to know to be the expert.
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Australian’s love affair with debt - how big is the risk?
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5 ways to keep a cool head in a falling share market
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2018 – a list of lists regarding the macro investment outlook
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Sports lovers enjoy better financial fitness
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Where Australia is at. Our leading indicators.
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The year that was and the year ahead
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Add some extra cash to your New Year
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New year, new financial resolutions
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Our Advent calendar for 2017
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Where are we in the global investment cycle?
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Australia's vital statistics
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12 ways to enjoy summer without spending a fortune
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One in three Aussies travel without protection
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Digital payment options could see you spend more this Christmas
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If you’ve always thought property prices only go up…
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Will Australian house prices crash?
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Where are we in the global investment cycle and what's the risk of a 1987 style crash?
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Money steps for women
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Resources on our site to help you, your family and your friends.
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Australian Dietary Guidelines and healthy eating chart (PDF)
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How to retire, your way
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Prepare for retirement without missing out today
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Be the boss of your cash
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The Australian economy bounces back again
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Should you lend money to family?
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Money mistakes people make in their 50s and 60s
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Australian Dietary Guidelines and healthy eating chart (PDF)
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Eight steps to improved cashflow... and lifestyle
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Powerful Budgeting, cash flow and Super Tools available on our site.
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5 ways Australians will use their tax return this year
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Australia's leading causes of death - ABS
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The threat of war with North Korea
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Six traits of Australians living the dream
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The break higher in the Australian dollar is likely to be limited
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Money can buy you happiness, you’re just spending it wrong
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Key Economic Indicators, 2017 – updated
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Helping your kids buy a home
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From Goldilocks to taper tantrum 2.0
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What’s your debt age?
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Doing a budget is a good idea but ....
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Planning is the key to making it financially
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What to do when you come into money
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Managing your money when you move in together
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Reduce your bills with these household items
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It pays to contribute to your partner's super
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How to cope with losing independence
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Transition to retirement income streams
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The Australian economy hits another rough patch
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Watch out for tax scams
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The three core pillars of this year's budget
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Federal Budget - 2017-18 - Overview
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Federal Budget - 2017-18 - Budget documents
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Make the most of the current super caps
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Five, four, three… it’s not too late to get more in super
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Super changes are coming
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What’s your debt age?
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Super changes this financial year - Dr Shane Oliver - video
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The door is closing on super’s current caps
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Is Donald Trump's honeymoon with investors over?
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Estate planning and why you need a super plan
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What does a comfortable retirement look like?
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Give your career a health check
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Super changes from July 2017
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Changes to the Age Pension assets test
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Keep your money safe over the silly season
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Looking ahead at 2017
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Review of 2016, outlook for 2017 - looking better despite the political noise
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Merry Christmas for 2016, a Happy New Year and a prosperous 2017.
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54.2 million worries
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Five tips for happy healthy ageing
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Thinking about managing your own super?
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Sending more to the tax office than you should?
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Government pulls back on proposed changes to super
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Market Update - What to consider when investing in a low return world
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Stop!! Don't do a paper Budget, use our online budgeting tools instead.
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Oliver's Insight - Megatrends
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Value of Advice
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A growing family doesn't have to blow the budget
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Blinded by optimism
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Thinking about managing your own super?
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The investment outlook - it's not all that bad!
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What’s your biggest obstacle to financial success?
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Should you own the roof over your head?
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Brexit wins
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Commentary on major issues - AMP
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2016-17 Federal Budget - AMP
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2016 Budget in detail
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Retirement rolls around faster than you think
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Changes to the Age Pension assets test
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Heirlooms no more
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Initial market falls precede stronger returns - Shane Oliver
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Aged Care - Changes to Assessment of Rental Income
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A bump in the road, then a new start
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New year, new start – are you ready for retirement?
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Review of 2015, outlook for 2016 - Dr Shane Oliver
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We wish you a Merry Christmas for 2015 and a Happy New Year
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Go easy on the plastic over Christmas
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Resolutions for a wealthy future
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The Australian dollar doing what it normally does - overshoot. Dr Shane Oliver
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How to manage volatility in a low return world
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The Australian economy - more help will be needed. Dr Shane Oliver
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Insurance through my super
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The demand for global infrastructure
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The Power of Budgeting
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A Super Loan for all reasons
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Making a smooth transition
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Budget 2015 - some professional opinions
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Australian Government - Budget 2015
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Achieving a comfortable retirement
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Is off-the-plan on the money?
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Should I take my super as a lump sum or not?
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To sell or not to sell?
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Saving in a material world
Market Update - September 2019

The table below provides details of the movement in average investment returns from various asset classes for the period up to 31 August 2019. 

       
 

Asset class (% change)

1 month

3 months

1 year

3 years 
(% pa)

Australian shares

-2.4

4.2

9.0

11.4

Smaller companies

-3.9

1.4

0.9

8.4

International shares (unhedged)

0.3

8.0

7.6

13.7

International shares (hedged)

-1.9

5.1

1.1

10.0

Emerging markets (unhedged)

-2.7

2.7

2.7

9.7

Property - Australian listed

1.3

8.3

19.8

8.9

Property - global listed

2.0

4.2

9.6

6.6

Australian fixed interest

1.5

3.5

11.2

4.7

International fixed interest

2.2

4.2

10.0

3.9

Australian cash

0.1

0.3

1.8

1.8

 
Past performance is not a reliable indicator of future performance. The Global Listed property reference index changed to FTSE EPRA/NAREIT Developed Rental NR Index (AUD Hedged) as of August 2019
 

Overview and outlook

 
Recession risk continues to increase, and the actions of the US President are not helping. Escalating the trade war through further increases to tariffs and sledging of his own Central Bank are causing concerns in market both in the US and more broadly. Trump finally recognised the impact of tariffs, although he would probably deny this, when he said that he was delaying some tariffs until December 15 that were scheduled to come into effect 1st September. He said this was, “Just in case some of the tariffs would have an impact on U.S. customers.” 
 
In a rather contradictory series of statements Trump said that the economy is doing “tremendously well” and then just a day later suggested that the US Fed should cut rates by 1% “over a fairly short period of time” and resume QE by buying bonds to reduce. 
 
In the UK the extraordinary event that is Brexit; the new Prime Minister decided to suspend Parliament from the 10th of September to the 14th of October in what was expected to be a critical time for Brexit. Further news just as we write this report, brings another interesting turn with Boris Johnson losing two votes, a vote on No Deal Brexit and then a vote to go to a general election. The reality is changing Prime Minister was unlikely to change the parliament’s appetite for a no deal Brexit nor Europe’s willingness to allow the UK to exit and retain many of the 
 
benefits of the union. However, something must give at some stage but what the UK Prime Minister can do now to break the impasse is not clear. 
 
In Europe, weakness in Germany with a 0.1% contraction in the June quarter could well be followed by a contraction in the current quarter given the softness in a range of indicators such as manufacturing with the PMI at 43.5 as of August and inflation at just 1.4%. 
 
The reality is that economic conditions are deteriorating in the US and more broadly around the globe. A series of economic indicators show this and the likelihood of a recession as measure by the Federal Reserve Bank of Cleveland quite clearly demonstrate that risks are rising. 
 
US recession Probability
 
Source: Bloomberg, AMP
In Australia, conditions are also weakening on the back of global softening and the US-China trade war. Weakness in construction, building approvals and credit growth all point to a slowing economy. 

Share markets

Global economic weakness and further uncertainty around the US-China trade war and Brexit with a little political unrest in Hong Kong all combined to push down growth assets through the month. It was a broad-based sell-off of growth asset as investors moved to more defensive assets. 
 
International shares lost 1.9% during the month on a currency hedged basis. In Europe shares were a little better only falling 1.3% however there were heavier falls in both Germany (-2.1%) and the UK (-4.1%) as economic conditions and the political mess in the UK had an impact in their local markets. Emerging markets were also weaker down 2.7% on an unhedged currency basis for the month. 
 
The Australian market was in the thick of reporting season in August with soft earnings coming through that were exacerbated by a change in the accounting standards in relation to the treatment of leases. Earnings growth across the market was a lacklustre 1.5% well below the consensus expectation of 2.0% - this was supported by strong growth in resources which saw 13% growth as compared to the rest of the market which saw earnings decline by 2.0%. 
 
According to FactSet FY19 earnings misses greatly outnumbered earnings beats, and downgrades to FY20 earnings estimates significantly outnumbered upgrades. Analysts cut FY20 EPS growth forecasts for the index by an average of 250bps, with most noting further downside risk ahead. 
 
Australian profit results relative to market expectations % of results
 
Source: AMP Capital
Companies announced more cuts to dividend than has been seen in many years with those increasing their dividends being very low compared to recent history. 
 
Australian dividends relative to a year ago
 
Source: AMP Capital
 
In August the reporting season combined with the economic and global issues to drive Australian shares down 2.4%. Health care which saw double digit growth in the reporting season was the best performing sector (3.6%), Info Tech (0.3%) with Consumer discretionary (+0.2%) were the only sectors to generate a positive return in August. The weakest sector was Materials (- 7.5%) as weaker than expected result combined with weakened commodity price outlook. Similarly Energy (- 5.6%) was down significantly over the month and Telecoms (-4.5%) was also among the weakest sector. 
 
The best performers in the S&P/ASX 100 were Lendlease (19.3%) which reported EPS growth for the half of 28%. Afterpay (15.9%) with strong income growth reported not withstanding a significant increase in the net loss. Wisetech Global (15.6%) which saw EPS growth for the half of 26% Amongst the worst performers was Iluka (- 25.7%) as mineral sands revenue fell 10.1% in the first half with some weakness in the outlook. Worley (-23%) with the company noting that its markets are being challenged by macro uncertainty. A2 Milk (-20.9%) despite reporting strong EPS growth of 47% for the year. 
 

Interest rates

Bonds performed well as investors moved to more defensive asset amid the concerns. Domestically the Australian 10-year yield fell 31 basis points to new record lows finishing at 0.89%. This drove Australian fixed interest up 1.5% for the month. 
 
In the US the 10-year yield was down 51bps to 1.50%. assisting global fixed interest to outperform the local market gaining 2.2% for the month. 
 

Property

 
Those who didn’t move to bonds or gold (6.5%) moved into the perceived defensiveness of Listed Property Markets which performed well with Australian listed property (1.3%) outperforming the local equity market. Global Listed Property (2.0%) doing better still.
 
 
AMP