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20170623 – Portfolio Activity

20170623 – Portfolio Update from Michael Cooper on Vimeo. In another volatile week of trading, the ASX200 has fallen more than a 1% after failing to break through 5800 on the upside early in the week. Financials have been in the spotlight as the Senate passed the bank bill levy unchanged and Moody’s downgraded credit ratings of all Australian banks. Importantly this step to include the big four banks had previously been omitted when S&P announced their downgrade last month. Moody’s noted that their downgrade was largely due to housing debt risks. The RBA minutes released on Tuesday also noted they are carefully monitoring the housing and labour markets, given concern over house prices, household debt and a lack of wage growth. This is nothing new and was not unexpected, the minutes went on to highlight that the RBA still has a 3% growth target for the future. Overseas summer has officially started in the US this week and the fourth of July holiday will see the beginning of ”driving season”. Even with inventories expected to decline through this period oil has continued to fall and is now in a technical bear market having declined more than 10% over the past few weeks. IMPLEMENTATION TIMEFRAME As mentioned earlier we have had another volatile week for Australian Equities which underlines the uncertainty of short term market movements. It is for this reason that we generally manage initial implementation on new accounts over a number of months, whilst taking guidance from your Adviser. We observe market conditions and a variety of metrics across the range of asset classes to ensure we...

20170616 – Portfolio Activity

In Australia, economic data release yesterday were better than the market expected. The economy added 42,000 new jobs in May which was well ahead of the median 10,000 expected. In addition, April’s 37,400 increase was revised up to 46,100. Over the last three months employment has increased by a very strong 141,000 jobs, which has meant a doubling in the pace of yearly employment growth to 2.0% over that same period. For the third month running, all the growth was in full-time jobs at the expense of part-time, which resulted in the unemployment rate falling from 5.7% to 5.5%, the lowest rate since February 2013. This was despite a small increase in the participation rate from 64.8% to 64.9%. The Bank of England voted by five to three, the largest division in 6 years, to keep the Bank Reference Rate at a record low of 0.25% yesterday. Policymakers showed concerns over rising inflation and slow pay growth and the effects on household spending and GDP. US data showed manufacturing levels were steady, industrial production flat and unemployment benefit claims lower than expected. On Thursday the Federal Reserve (Fed) announced its second rate hike of 2017, an increase of 0.25% to a 1.00-1.25% range. The Fed stated inflation will be low for now but expects it to stabilise at higher levels over the medium term. China’s economy grew faster than expected; 6.9% in the first quarter, above the government’s annual target of around 6.5%. On the back of the announcement the International Monetary Fund has raised its forecast for China’s economic growth this year to 6.7%, citing ”policy support, especially...

20170519 – Portfolio Activity

20170519 – Portfolio Activity from Michael Cooper on Vimeo. This week markets finally lost their patience with the turmoil that has engulfed the Trump White House, in the process seeming to discount the prospects for tax cuts and deregulation that had fuelled momentum in US markets after the election in November. Ironically, there is now some momentum behind the move to impeach the president, though that still remains an unlikely prospect at this time. More importantly, the confidence that tax cuts, deregulation and an infrastructure program will be delivered is greatly diminished. At this point the pull-back remains relatively modest given the size of the rally, but this obviously remains a very fluid environment. With all eyes on Washington the Australian unemployment data had only a limited impact on our local share market. The April data showed a strong increase in new jobs and the headline unemployment rate fell to 5.7%. Also this week wages growth was steady, but remains at historically low levels. This is a key metric in which we are looking for improvement, but for now we need to be content with no further slowing. PORTFOLIO TARGET EXPOSURES The Individually Managed Account portfolio structure allows for variability between individual portfolios that are allocated to the same Investment Program. This ability to genuinely treat you as an individual and account for your preferences is the cornerstone of the portfolio service. When we make a decision as an investment committee we necessarily think in broad terms across all portfolios, and of course we take a long-term view in our forecasting. However, when we come to implement that decision...

April 2017 Market Commentary

April 2017 Market Commentary   Since our last commentary we have had new presidents elected in France and South Korea, missile tests from the latter’s northern neighbor, unprecedented actions from the US president and continued Brexit negotiations in Europe. Closer to home the talk about a housing bubble and the potential impact on the banks should it burst has been unrelenting, and this topic was also central to the latest federal budget. And yet, though these events might ordinarily be expected to lead to instability in investment markets, we have seen volatility remain low and major global share market indices maintain modest to impressive year to date gains. The patience to maintain a long-term focus and the discipline to filter the noise that pervades the short-term view is what has led to the welcome recent strong portfolio performance, and is what we will continue to deliver in our management of your portfolio. 20170516 – MXA – Monthly Commentary Click on the link to read our Monthly Economic & Investment Market Commentary for March 2017 attached. If you have missed any previous monthly commentaries and wish to receive a copy, please contact our office.   20170516 – MXA – Monthly Commentary MXA Financial Planning Pty Ltd is a Corporate Authorised Representative No. 1252255 My Planner Professional Services Pty Ltd AFSL No 425542 General Advice Disclaimer Information provided on this flyer is general in nature and does not constitute financial advice. Information can change without notice and MXA Financial Planning Pty Ltd does not guarantee the accuracy of information on the flyer, including information provided by third parties, at any particular time. Every...

The Budget 2017/2018

  The Budget 2017/2018 The government’s economic plan to ensure Australia continues to successfully transition from the mining investment boom to a stronger, more diversified, new economy Let’s slice and dice the budget to see who gets what. Where every dollar comes from and how it is spent. Taxation   Major bank levy From 1 July 2017, a major bank levy will be imposed on Authorised Deposit-taking Institutions (ADIs) with licensed entity liabilities of at least $100 billion. The threshold will be indexed in line with nominal gross domestic product. The levy will be calculated quarterly as 0.015% of an ADI’s licensed entity liabilities for an annualized rate of 0.06%. Increase in Medicare levy From July 2019, the Medicare levy will increase by half a percentage point from 2.0 to 2.5 % of taxable income. Other tax rates that are linked to the top personal tax rate, such as the fringe benefits tax rate, will also be increased. Indexation of Medicare levy thresholds The threshold for singles will be increased to $21,655. The family threshold will be increased to $36,541 plus $3,356 for each dependent child or student. For singles senior and pensioners, the threshold will be increased to $34,244. The family threshold for senior and pensioners will be increased to $47,670 plus $3,356 for each dependent child or student.   This applies for the 2016-2017 financial year.   Lower threshold for HELP debt repayments From 1 July 2018, a new minimum threshold of $42,000 will be established with a 1% repayment rate and a maximum threshold of $119,882 with a 10% repayment rate.   Expanding tax incentives for...

20170505 – Portfolio Activity

20170505 – Portfolio Activity Update from Michael Cooper on Vimeo. On Monday the ASX 200 index hit a two year high of 5956, falling short of the March 2015 peak. This was quickly followed by four days straight of losses as declines in commodity prices saw the Resources Sector sell off. The market today looks likely to close around the 5,830 level, down 1.6% for the week. Globally, stock markets have been mixed, the Japanese stock market has been closed for three consecutive days for holidays and in Hong Kong the market was closed on Wednesday for The Birthday of the Buddha. As widely expected, the Reserve Bank of Australia decided at their Board meeting on Tuesday to keep the cash rate unchanged at a record low of 1.5% for the eighth consecutive month. The statement is similar to last month with little hint of any change to the policy rate in the near future. The Governor repeated his broad guidance that the current stance of policy was consistent with sustainable economic growth and achieving the inflation target over time. In the US the Federal Reserve announced on Wednesday that the benchmark interest rate would remain unchanged after a two-day policy meeting, as had widely been expected. The only new information from the meeting came from changes to the Federal Open Market Committee’s statement where the committee adjusted language to acknowledge the weaker inflation and consumption data of late is ”likely transitory” and the risk in the near-term remains ”roughly balanced”. The Committee did not signal a change to its interest rate projections or balance sheet policy. PACE OF...