News Updates
AS IT HAPPENS
While as a nation we collectively face a large retirement savings gap, there are a number of smart things you could consider doing to help make sure your future financial security isn't at risk. Read more here
For more information, contact Rick Maggi at Westmount Financial on 9382 8885.
Falling oil prices are currently in lockstep with share prices, which is unusual. So understandably, plunging prices have been seen in a negative light, but is it all bad news? Is there an upside to low oil prices? AMP's Dr Shane Oliver takes a balanced look at this recent phenomenon. Read more here
When we look back at the things that helped make 2015 a great year, our warmest and fuzziest feelings come when we think of you, our client.
So thank you for choosing Westmount. Here's to another prosperous, healthy, exciting year full of possibilities!
The Westmount Team
After much delay and much warning, the Fed has finally raised the Fed Funds rate from a range of 0-0.25% to 0.25%-0.5%. The move signals confidence in the ongoing recovery in the US economy after the crippling effects of the Global Financial Crisis. More importantly, the language of the Fed was sufficiently dovish with regard to future rate hikes.
At the time of writing, the ASX200 has gained almost 100 points, on top of the previous day's 118 point rebound, and BHP shares are up over 5% - a major relief to for investors who watched the local bourse fall in each of its six prior sessions.
As the end of 2015 draws to a close, it's a good time to take a look at the year we've had, but also consider what the year ahead might look like. With the US economy accelerating, and Chinese growth slowing, we're moving into less familiar territory, potentially unnerving inexperienced and seasoned investors alike - so going forward you'll need to keep your wits about you.
AMP Capital's Dr Shane Oliver provides an excellent overview of 2015/16. Read more here
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
Selling a small business can be a challenging, complicated and uncertain time. So too can retiring. Combine the two and you have a situation where early planning and advice is critical. Retiring from Small Business
For more information, contact Rick Maggi at Westmount Financial on 9382 8885.
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
Why don't the media run more good news? One view is bad news sells. If people preferred good news, the media would supply it. But markets don't see news as necessarily good or bad. Read on
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
In this article, AMP Capital's Dr Shane Oliver discusses what is on everyone's mind lately, the strong possibility of an interest rate hike in December. Is this something that should be feared or celebrated? Read more here
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
The Standard & Poors scorecard, which compares active manager investment performance with index fund performance is here, and the results further validates Westmount's investment philosophy - great news for our clients. Read more here
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
As broadly expected, the Reserve Bank of Australia (RBA) decided to hold off a little longer and keep interest rates steady today.
While there is a general consensus out there that the RBA stands ready to cut interest rates in the future should the Australian economy remain sluggish, the RBA wants to see more economic data filter through the system as some parts of the Australian economy are actually showing signs of life. And if the economy continues to gradually improve, the RBA will be less likely to move on rates (a good thing).
So in short, the RBA, by it's language today, is effectively saying that conditions are by no means ideal, but good enough for now.
Of course, the RBA will also be looking over its shoulder to the US, where interest rates are widely expected to rise either this or early next year.
We'll keep Westmount clients informed of any new developments going forward.
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
Australian housing remains overvalued, and the Sydney and Melbourne markets, in particular, appear to be cooling. Property investors need to be careful going forward as price falls of around 5-10% are expected in the coming year or two - a potential problem for highly indebted property owners. Read more here
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
Following steep overnight falls in Europe and the US, today our own market followed suit, with the benchmark S&P/ASX200 index down a hefty 195.1 points, or 3.82 per cent, to 4,918.4 points.
So far this quarter, local markets have fallen by just over 9 per cent. So with just one day left in the quarter, it is likely to be the worst period for investors since the third quarter of 2011, when the market fell 13 per cent amid an economic crisis in Portugal, Ireland, Italy, Greece and Spain.
This time however, the explanation is an easy one to understand – China’s slowing economic growth. Over the September quarter, and especially the past two months, China's manufacturing sector has come under severe pressure.
With iron ore prices flat lining over the quarter, oil prices down and the price of copper in free-fall, it’s easy to understand why Australia’s resource sector, which is heavily dependent on demand from China, is experiencing the perfect storm.
Remember, copper is viewed as a baseline for the health of the Chinese economy because it is used heavily in industrial building, housing construction and technology.
AMP Capital's head of portfolio management Debbie Alliston said China is the key factor in plunging share prices. "Markets are reacting to fears that this going to slow global growth significantly, particularly for those countries that are reliant on Chinese demand," she said.
Weakness in the Australian banking sector, amid moves by regulators to slow lending to property investors amid soaring Sydney and Melbourne home prices, has also weighed on the share market.
On top of that are the usual worries about the timing of a US Federal Reserve interest rate hike.
But Ms Alliston said members of superannuation funds with investments in a range of assets should not panic about the market's downturn, and sit tight instead. "This is definitely not another GFC," she said.
According to another analyst, the market's heavy fall has “Australian shares looking cheap, and stock valuations are probably near the point of luring buyers back into the market, especially with interest rates set to remain low.”
We'll keep Westmount clients updated on any important developments.
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
This update is published by Westmount Financial/Westmount Securities Pty Ltd (ABN 42 090 595 289/AFSL 225715). It is intended to provide general information only and does not take into account any particular person’s objectives, financial situation or needs. Because of this, you should, before acting on any information in this document, speak to us and/or a taxation/finance professional.
Produced by Russell Investments, I'm afraid to say that this particular illustration, going back to August 1984, brings back many, many memories. Worth a quick look. View Here
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
At the time of writing, the Australian share market (ASX200) has fallen by 13% since the highs of February this year, much of this occurring over the last couple of months. It also seems that the usual doomsayers have been working overtime, doing their level best to frighten investors into either subscribing to their alarmist newsletters, buying their books or engage investment services. On the other side of the spectrum you have some perennially optimistic fund managers and financial advisers who prefer to bury their heads in the sand, refusing to acknowledge that the landscape has changed.
Of course, the truth is usually somewhere in between, and very few commentators strike the right balance better than AMP Capital's Dr Shane Oliver. In this article, Dr Oliver provides a calm, balanced, 'grown-up' perspective of the recent share market falls, and their place in history. As usual, this publication is a must for anxious retirees and investors. Read more here
Also, read 9 rules for investors to keep in mind
Going forward from here, Westmount clients will continue to be kept apprised of the latest important developments, in real time, good news, or bad.
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
The Reserve bank board met on Tuesday 1 September and kept official interest rates on hold at 2%, continuing to assess the impact of the two rate cuts earlier in the year.
Lack of business investment No doubt the RBA board would have discussed at length current weak commodity prices impacting our national income, the lack of business investment as well as two key developments that arose earlier in August. These include the recent devaluation of the Chinese currency and the weak Australian unemployment report.
Unemployment rate Previous RBA commentary indicated it considered the unemployment rate profile was around 6%. However the other key development in August was that the unemployment rate jumped to 6.3%. A higher unemployment rate is also a catalyst for an inflation downgrade, due to weak wages growth.
Business conditions and confidence The NAB business confidence survey for August pared back the post Budget gains, however both conditions and confidence are suggesting a turnaround in the non-mining economy, with conditions varying greatly across industries. The confidence index is still positive and holding around average levels.
Macquarie Bank is of the view that the combination of the Chinese currency devaluation, a weakening labour market and excess capacity in the economy all support the case for a further rate cut in November. The next RBA board meeting will be held on Tuesday 6 October.
Rick Maggi Westmount Financial Clear Focus. Better Solutions.
