Nov 18, 2016 | Investment Advice

International News (Issue 426) – 18 November 2016

Once again if I could flag the 14-page presentation I put together for clients as to our views post the Trump election win.

The link is above in the Australian shares section, and is worth a read for those interested in how we see the impact on investment markets.

In foreign markets this week there were several items to note.

Perhaps most significant was the ongoing strength in the USD. The US-dollar index reached a 12-year high this week in the aftermath of Trump’s victory, with all major cross-currencies weakening in response (AUD, Euro, Yen, GBP & Reminbi).

Somewhat ironically (I think at least), the Chinese Renminbi fell to its lowest level since the GFC, and should be watched closely in the coming months for signs of renewed capital flight.

This is a major risk for the Chinese and world economy, and is ironic given the weakness seems to have been further exacerbated by Trump’s election win (note he said he would declare China a currency manipulator once in office!).

The semi-annual testimony to Congress of the Federal Reserve chairwoman Janet Yellen seemed to confirm market expectations for a December rate hike.

The S&P500 closed on Thursday 3pts short of a record high, and points to continued enthusiasm for Trump economic policy – at least for now.

 IndexChange%
U.S. S&P 5002187+20+0.9%
London’s FTSE6795-33-0.5%
Japan’s Nikkei17863+519+3.0%
Hang Seng22263-576-2.5%
China’s Shanghai3208+37+1.2%

 

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