MLC Market Watch

October was another favourable month for investors although sharemarket performances were relatively modest compared to last month.

In this update, MLC’s Senior Investment Strategist John Owen looks at:

• the strong gains in the resources sector,
• the impact of the strong Aussie dollar, and
• what it all means for MLC investments.

View the View the November market update video here.

Download John Owen John Owen video script.

With the local recovery gathering momentum and the global sharemarkets on the up, MLC’s Investment Strategist Brian Parker looks at:

• the recent sharemarket gains and what the figures really mean
• the impact of the stablising economy on interest rates and equity markets, and
• how the winding back of Government stimulus may affect investors

View the September market update video here.
Download Brian Parker video script.

The global economic crisis (GFC) has wreaked havoc with Australia’s economy. We’ve seen GDP fall, unemployment rise, investments decline and a sombre mood take hold in the market.

There’s no guarantee that the worst is over yet, however several indictors are suggesting the rate of decline may be slowing and our economy may be starting to fight back.

Looking at the financial news in Australia, the general tone is ‘cautiously optimistic’. Some experts are predicting we’ve seen the worst of this recession and that recovery is imminent or may have even commenced. Others are predicting a long slow recovery. Which outcome is correct will depend in part on how and when the rest of the developed world, (particularly the US) resolves their significant debt and imbalance issues.

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While the Australian economy is holding up relatively well in the midst of a global downturn, investors are still bearing the brunt of the worldwide market turmoil.

With predictions of a global recession stretching well into 2010, and an assumption that Australia will not be immune, does this mean investors can expect more pain? The answer, it seems, is maybe not.

The world is in one of the most serious economic and financial crises since the 1930s depression. Economies have rapidly contracted, the world’s financial system is in disarray and unemployment queues are lengthening.

In response, governments across the globe are undertaking massive programmes to avoid a repeat of anything like the Great Depression. We’ve seen trillion dollar stimulus packages, government guarantees of banking deposits and lowered interest rates amongst a whole host of other measures in an attempt to stimulate the economy.

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