InvestNow News 26th July – Russell Investments – Global Market Comment – Q2 2019

Global shares

Global sharemarkets made good gains in the June quarter, with the MSCI ACWI Index – Net returning 5.2% in unhedged NZD terms (or 3.1% in hedged NZD terms). Much of the gains came after central banks turned more dovish in the face of rising global growth concerns. Growth fears intensified throughout the period amid a series of softer global macroeconomic data, falling bond yields and heightened geopolitical risks; notably an escalation in Sino-US trade frictions. Both the US Federal Reserve (Fed) and the European Central Bank signalled their willingness to adjust monetary policy to boost growth should it be needed, while the Reserve Bank of New Zealand (RBNZ) and the Reserve Bank of Australia (RBA) went one step further and lowered their respective cash rates to all- time lows. Stocks in the US (3.8%1) rose as investors bet that the Fed will deliver a rate cut at the end of July. Sharemarkets in Europe (3.6%2) and the UK (2.0%3) were also stronger for the quarter, though ongoing uncertainty surrounding Brexit kept the latter’s gains in check. Japanese stocks (0.3%4) posted only modest gains over the period, while China’s sharemarket (-1.2%5) weakened as trade talks with the US deteriorated.

New Zealand shares

The New Zealand sharemarket was stronger for the quarter, returning 6.8%6 and hitting further record highs in the process …

Read on >