MLC Market Watch

The recent market volatility is, understandably, making investors nervous and they’re probably concerned this volatility resembles the correction we had mid-way through 2011.

While we’re expecting short-term volatility, we’re confident in the medium-term return potential in equities.

While there are clearly difficult macro uncertainties, we’re increasing our focus on companies which, we believe, have the fundamental strengths to perform well, even in this environment.

And our investment managers have been avoiding some of the troubled areas and are actively finding the opportunities that will underpin long-term returns for clients.

Current markets and our investment approach

Our approach to investing is supported by what sounds like a simple notion; share prices follow earnings which follow economic growth.

However, what happens to economic growth, how that translates into company earnings and the value the market places on those earnings, is far from straightforward.

Today there are real worries about the course of global economic growth and this creates uncertainty about future company earnings streams, which is why we’re seeing such volatility in markets.

We understand this, but continue to emphasise the importance of investing in fundamentally sound companies to deliver adequate real returns for investors.

For more information, please contact your financial adviser.

Since last month’s update, markets have become increasingly concerned over the durability of global growth and sovereign risk concerns surged again, leading to a drop in world share prices of around 3%.

In this update MLC’s Investment Strategist Brian Parker looks at:

• bond market movements
• consumer confidence levels in Australia and internationally, and
• Australian economic growth prospects.

View the June market update video here.

Download Brian Parker video script.

Apart from the crisis in Libya and the consequences of Japan’s earthquake, thankfully there have been no new disasters to hit the global economy.

In this update MLC’s Investment Analyst Kerry Gill looks at:

• the flow on effects from Japan to the rest of Asia
• the Aussie dollar’s dramatic spike, and
• what it all means for return prospects.

View the May market update video here.

Download Kerry Gill video script.

Sharemarkets around the world suffered in the wake of the terrible earthquake and tsunami in Japan.

In this update MLC’s Investment Analyst Kerry Gill looks at:

• the economic impact of the disaster
• the global economic outlook, and
• what it means for return prospects.

View the April market update video here.

Download Kerry Gill video script.

World sharemarkets have enjoyed a reasonable start to the year with economic news from the US, China and Germany boosting confidence.

In this update MLC’s Investment Strategist Brian Parker looks at:

• the domestic impact of the floods and Cyclone Yasi
• China’s accelerated economic progress, and
• what it means for return prospects.

View the February market update video here.

Download Brian Parker video script.