The InvestSense Podcast

In summary: 
Strong Quarter Performance Across Diverse Markets: The first quarter of 2024 has seen markets finish with low volatility and high returns, defying weak data with a positive outlook on the latest inflation and economic figures. Notably, diversified portfolios have delivered exceptional returns, comparable to what might typically be expected for an entire year, within just the first three months.

Geographic Performance Highlights: Japan was the standout performer for both the week and the entire quarter. Europe showed little volatility, while the U.S. delivered the best returns but with considerably higher volatility, especially among large cap tech stocks. 

Investment Strategy Insights: The current low volatility environment, with the 'Goldilocks/Soft Landing' scenario largely priced in, presents a dilemma between market complacency and solid fundamentals. Active asset allocators are taking a more defensive stance, potentially safeguarding against future uncertainties but possibly missing out on gains should the positive scenario continue. This cautious approach is characterised by being underweight in duration and the US market, reflecting a strategic choice that worked well in 2022 but now faces unpredictable months ahead.

Watch the Market Report: https://www.investsense.com.au/industry-articles/q1-2024-update-world-markets-roar-asx-shouts-a-bit 

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This past week saw eventful moves in markets, largely driven by central bank actions.
In brief:

• The Swiss National Bank's unexpectedly reduced rates, going against the broader trend.
• The Bank of Japan made the historic decision to end its yield curve control policy. Despite the media coverage, this was widely expected and Japanese government bond markets only saw modest moves, with the yen appreciating about 1%.
• In the U.S., the Federal Reserve kept interest rates on hold as expected, but struck a more dovish tone than anticipated given recent strong economic data and sticky inflation readings, especially in services.

Get access to the charts: www.investsense.com.au/industry-articles/central-banks-shake-markets-the-weekly-market-sense-check
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Despite a relatively calm week in global markets, the focus was on higher-than-expected inflation figures.


In brief:

• Inflation data: The Personal Consumption Expenditures (PCE) index and February Consumer Price Index (CPI) print both exceeded forecasts, igniting concerns about the persistence of disinflationary trends.
• Bond Market Reactions: Bond markets showed a more pronounced response to the inflation news compared to equity markets. We saw U.S. rates rising by nearly 20 basis points and Australian rates following suit. 
• Market Outlook and Assumptions: While markets anticipate an easing cycle for short-term rates, there's a growing sentiment of stagflation due to declining growth expectations coupled with rising inflation forecasts.

Get access to the charts: https://www.investsense.com.au/industry-articles/a-flat-market-despite-surprising-inflation-data?utm_source=Podcast&utm_medium=Mar_16

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Mirroring last week's trend, markets dipped early this week with the Nasdaq and US tech stocks leading the decline, before bouncing back at the end of the week.

Get access to the charts: www.investsense.com.au/industry-articles/volatility-fed-rate-signals-and-global-growth-trends

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Gain insights with our market sense check based on the performance from the last week of February 2024.

Get access to the charts: www.investsense.com.au/industry-articles/a-relatively-flat-market-inflation-trends-and-a-review-of-februarys-performance

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Global markets were mixed this week as investors digested the latest economic data and corporate earnings results.

Watch the market update here: https://www.investsense.com.au/industry-articles/global-markets-navigate-mixed-signals-earnings-surges-inflation-divergences-and-the-persistent-volatility-ahead ?utm_source=Podcast_Video&utm_medium=Feb24

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Markets gyrated last week as hotter-than-expected US inflation data sparked an initial tech rout before recovering. Meanwhile better-than-feared earnings results and recession-resilient emerging markets outperformed. Though the likelihood of near-term rate cuts faded back, Australian reporting season launches on already lowered projections offering turnaround potential, especially for smaller companies that reset expectations during recent economic headwinds.

It was an up and down week for markets after a strong finish the prior week. Markets ended slightly up but the Fed pushed back on imminent rate cuts, putting some pressure on markets. However, positive earnings results overcame that and the US market hit new highs.

Amid a mixed bag of US corporate earnings and a strong jobs report fueling rate hike expectations, global markets face contrasting fortunes, highlighting the complexity of forecasting economic trends in a time of technological growth and geopolitical uncertainty.

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