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Trump’s surge spooks markets

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Original article by Cameron Stewart, David Rogers
The Australian – Page: 1 & 10 : 3-Nov-16

Sharemarkets in Australia and Asia were sold down on 2 November 2016, after an ABC News/Washington Post poll showed that US presidential candidate Donald Trump now has a one percentage point lead over Hillary Clinton. The RealClear Politics average of polls also shows that Trump has significantly narrowed Clinton’s lead in the last week. Westpac economists have warned that a Trump victory could have a bigger impact on global financial markets than the UK’s Brexit referendum.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, NIKKEI 225 INDEX, HANG SENG INDEX, SHANGHAI COMPOSITE INDEX, KOSPI INDEX, WESTPAC BANKING CORPORATION – ASX WBC, WILSON ASSET MANAGEMENT, REPUBLICAN PARTY (UNITED STATES), DEMOCRATIC PARTY (UNITED STATES)

Cashed-up fund cools on property

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Original article by Daniel Palmer
The Australian – Page: 24 : 1-Nov-16

The Future Fund has posted a return of 1.5 per cent for the September 2016 quarter. Its cash holdings rose by 0.4 per cent to 22.1 per cent, compared with just 15.1 per cent for the same period in 2015. The sovereign wealth fund lifted its portfolio’s weighting toward equities by 0.6 per cent to 29.4 per cent, while its exposure to property and private equity fell. MD David Neal says the Future Fund is likely to maintain its risk-adverse profile. Its assets under management totalled $A124.65bn at the end of the quarter.

CORPORATES
AUSTRALIA. FUTURE FUND MANAGEMENT AGENCY, PORT OF MELBOURNE

Clinton victory and divided Congress ‘best for shares’

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Original article by Vesna Poljak
The Australian Financial Review – Page: 11 & 16 : 1-Nov-16

UBS suggests that in terms the outlook for equities, the best outcome of the US election would be if Hillary Clinton becomes president but neither party has control of Congress. Wingate Asset Management’s Chad Padowitz notes that health stocks in particular could be sold down if the Democrats control both houses. Historical analysis by AMP Capital shows that since 1927, US equities have delivered better returns when a Democrat has been in the White House but one or both houses of Congress have been controlled by the Republican Party.

CORPORATES
UBS HOLDINGS PTY LTD, WINGATE ASSET MANAGEMENT PTY LTD, AMP CAPITAL INVESTORS LIMITED, DEMOCRATIC PARTY (UNITED STATES), REPUBLICAN PARTY (UNITED STATES), STANDARD AND POOR’S 500 INDEX, SANOFI PHARMACEUTICALS, DELTEC ASSET MANAGEMENT LLC, WESTPAC BANKING CORPORATION – ASX WBC, CHICAGO BOARD OPTIONS EXCHANGE VOLATILITY INDEX, UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL BUREAU OF INVESTIGATION

Banks charged customers $180m for no financial advice

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Original article by Misa Han
The Australian Financial Review – Page: 6 : 28-Oct-16

The Australian Securities & Investments Commission has released a report on the dubious practices of financial advisers aligned with the "big four" banks and AMP. ASIC found that many customers had been charged for financial advice between August 2013 and December 2015, but they did not receive any such advice. ASIC noted that most of these cases occurred prior to the implementation of the Future of Financial Advice reforms. It is estimated that about 200,000 customers will be entitled to total compensation of some $A178m.

CORPORATES
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, MACQUARIE GROUP LIMITED – ASX MQG, AUSTRALIAN BANKERS’ ASSOCIATION

Dr Doom says ‘a serious recession desirable’ for the West

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Original article by Patrick Commins
The Australian Financial Review – Page: 17 & 31 : 28-Oct-16

Investment expert Marc Faber notes that global economic power has shifted from the developed world to emerging economies in recent decades. He adds that trade between Asian countries has also become much bigger than the region’s exports to the US. Faber also suggests that the financial sector still accounts for too much of the economy in Western nations, and a major recession may be beneficial for developed countries. He says mining stocks and emerging market equities offer good value at present compared with their peers.

CORPORATES
BLOOMBERG LP

Trump might win, and beware the turmoil

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Original article by Matthew Cranston
The Australian Financial Review – Page: 15 & 20 : 26-Oct-16

Hedge fund expert Jim Rogers says global financial market volatility is likely regardless of the outcome of the US presidential election. Rogers adds that a number of other factors will also contribute to looming financial market turbulence. He cautions against investing in bonds, and says investors should seek exposure to the agricultural sector, including farmland and agricultural futures. Rogers also says the Australian Government should take action to address the nation’s growing debt.

CORPORATES
QUANTUM FUND NV, APPLE INCORPORATED, AMAZON.COM INCORPORATED, GOOGLE INCORPORATED, MACQUARIE GROUP LIMITED – ASX MQG, PARAWAY PASTORAL COMPANY LIMITED

Perth fundies see more upside in resources

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Original article by Tess Ingram
The Australian Financial Review – Page: 13 : 24-Oct-16

Australia’s S&P/ASX 300 Metals & Mining Index has gained 45.3 per cent so far in 2016, while the benchmark S&P/ASX 200 has risen by just 6.2 per cent. The rebound in the share prices of resources and energy stocks has rewarded investors who capitalised on a sell-off in the sector earlier in the year. WestOZ Funds Management has been progressively lifting its funds’ weightings toward the sector over recent months, while scaling back their exposure to cash.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, STANDARD AND POOR’S ASX 300 METALS AND MINING INDEX, WESTOZ FUNDS MANAGEMENT PTY LTD, WESTOZ INVESTMENT COMPANY LIMITED – ASX WIC, PACKER AND COMPANY INVESTIGATOR TRUST, NORILSK NICKEL, CAMECO CORPORATION, BELL POTTER SECURITIES LIMITED, WOODSIDE PETROLEUM LIMITED – ASX WPL, INDEPENDENCE GROUP NL – ASX IGO, WESTERN AREAS LIMITED – ASX WSA, SANDFIRE RESOURCES NL – ASX SFR

How banks and resources could move in sync

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Original article by David Rogers
The Australian – Page: 31 : 21-Oct-16

The S&P/ASX 200 Materials Index has significantly outperformed the S&P/ASX 200 Banks Index in 2016, with a gain of 29 per cent compared with the latter’s eight per cent fall. Deutsche Bank notes that with the exception of the last four years, the two sectors have both regularly outperformed the broader sharemarket over the last 25 years. In addition, they have often outperformed in tandem. Tim Baker of Deutsche argues that the divergence of the two indices over the last few years suggests that they could be set for a new period of joint outperformance.

CORPORATES
STANDARD AND POOR’S ASX 200 MATERIALS INDEX, STANDARD AND POOR’S ASX 200 BANKS INDEX, DEUTSCHE BANK AG

Trump win would trigger volatility: fund managers

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Original article by Jessica Sier
The Australian Financial Review – Page: 27 : 20-Oct-16

A survey of global fund managers shows that 53 per cent expect financial market volatility to increase if Republican Party candidate Donald Trump wins the US presidential election. The Bank of America Merrill Lynch survey also found that 55 per cent of respondents think equities and bonds are overvalued, while 44 per cent anticipate that treasury yields will be the biggest influence on share prices during the next six months.

CORPORATES
BANK OF AMERICA CORPORATION, MERRILL LYNCH AND COMPANY INCORPORATED, REPUBLICAN PARTY (UNITED STATES)

Small-cap party could end in tears when the next crash comes

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Original article by Philip Baker
The Australian Financial Review – Page: 26 : 20-Oct-16

The Dow Jones Industrial Average has gained almost 944 per cent since the Black Monday sharemarket crash of October 1987, while the S&P 500 has risen by 854 per cent. In contrast, Australia’s All Ordinaries Index has increased by nearly 245 per cent. However, analysis by Richard Coppleson of Bell Potter suggests that when dividends are taken into account the All Ordinaries Accumulation Index has only slightly underperformed the S&P 500. Meanwhile, Coppleson warns that the current rally in small-cap stocks is unsustainable and a major fallout is inevitable.

CORPORATES
DOW JONES INDUSTRIAL AVERAGE INDEX, STANDARD AND POOR’S 500 INDEX, STANDARD AND POOR’S ASX ALL ORDINARIES INDEX, BELL POTTER SECURITIES LIMITED, RESERVE BANK OF AUSTRALIA