|
Investment Commentary
Market Update (as at 31 October)
- Global stocks were flat for the month in local currency terms, despite oil breaching the $70 dollar per barrel mark. Energy companies continued to benefit from the rising oil price, returning 5% for the month. All other industries struggled, however, with the consumer discretionary sector faring the worst, falling about 2%. Looking at the major countries: stocks fell about 1% in the US and continental Europe, Japanese stocks gained 4%, whereas the UK market was flat for the month. Global stocks were down around 1% in NZD terms as the US dollar weakened following Hurricane Katrina.
- The Australian share market gained 2% during August in local currency terms, but was flat in NZD due to the stronger exchange rate. Woodside Petroleum and BHP Billiton performed well again, while Telstra's cancellation of its $5 billion buyback program saw that stock weaken. Insurance Australia Group was the other notable decliner, which fell following a lower second-half profit announcement.
- Domestic shares were also little changed during August, with strong gains from Carter Holt, NGC/Vector and Lion Nathan offset by declines from F&P Appliances, Auckland Airport and Contact Energy.
- US 10-year yields rose 0.4% in July with the US Federal Reserve chairman reiterating further interest rate hikes are on the cards. China's decision to link the yuan to a basket of currencies, instead of just the US dollar, may also have contributed to higher yields. However, New Zealand long-term yields didn't follow the US lead this month, with yields more or less unchanged.
top...
|
