Market Insights – 21/06/2021

Market Insights – 21/06/2021

Market Insights

21st June 2021

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CBA

$103.69

2.16%

 

FMG

$22.42

-4.60%

BHP

$46.52

-5.37%

 

ANZ

$28.98

2.77%

CSL

$305.52

2.15%

 

WES

$57.72

3.81%

WBC

$26.88

1.90%

 

WOW

$42.67

-1.52%

NAB

$26.87

1.32%

 

MQG

$154.26

1.31%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

AUS DOLLAR IS BUYING

All Ords

7,624.30

0.31%

US Dollar

0.7488

Dow Jones

33,290.08

-1.58%

Euro

0.6307

FTSE-100

7,017.47

-1.90%

GB

0.5422

Nikkei

28,964.08

-0.19%

Yen

82.5090

Hang Seng

28,801.27

0.85%

NZD

1.0784

Commodities

Oil (WTI)

71.060

0.62%

Gold

1,776.600

-0.21%

Iron Ore

214.690

-0.22%

Major Market Announcements

– The three main Wall Street indexes all finished sharply lower on Friday, after investors were spooked by hawkish interest rate comments by Federal Reserve official James Bullard.

– Greater Sydney’s eye-watering house prices have surged this year with a new report warning there will be more rises on the way.

– Woolworths’ pubs and liquor stores business Endeavour will debut on the ASX in the next couple of weeks after shareholders approved a demerger. Woolworths shareholders on Friday voted to demerge Endeavour, which owns BWS and Dan Murphy’s, as well as hotels.

Market Update

Shares on the ASX have had their fifth consecutive week of gains – the best run this year – and ended the week at a record closing high.

Information technology shares attracted most attention with gains of 3.53 per cent on Friday and helped the market close higher by 0.13 per cent.

Investors appeared to recover from US Federal Reserve officials on Thursday bringing forward estimates of higher rates to 2023.

On Friday, the benchmark S&P/ASX200 index closed higher by 9.9 points, or 0.13 per cent, to 7368.9.

The index came within three points of a record high.

The All Ordinaries closed up by 23.8 points, or 0.31 per cent, to 7624.3.

The Australian dollar was buying 75.41 US cents at 1619 AEST, lower from 76.20 US cents at Thursday’s close.

The Current Low Interest Rate Environment

For some time now we have had a few articles on interest rates being so low and how the vast majority of investors (especially retiree types) are getting virtually nothing on the defensive portions of their portfolio – whether ordinary investments/superannuation investments and/or pension investments.

To highlight the following table gives a sample of how low available rates are today:

World Shares Chart

And this sample is fairly indicative of the total market.

Please give us a call if you are concerned with the current returns on your defensive assets and wish to discuss possible alternatives and options.

Brain Teaser

Last weeks question:

What happens to my remaining superannuation funds from a tax point of view when I die: 

  • If I have a partner who is financially dependent on me OR
  • I am single and/or have no persons who are financially dependent on me.

Answer:

Within the superannuation system when you nominate a dependent, which the SIS Act defines a dependent as; spouse of the person, any child of the person and any person with whom the person has an interdependency relationship with. This being the case, then on your death the superannuation proceeds would pass to the dependent completely tax free.  

This is of course assuming you have a death binding nomination in place.  This payment could be in the form of a lump sum or continuation of a superannuation reversionary pension.

Whereas on your death, if you do not have a person who is classified as a “dependent” a financially independent adult child for example, then the taxable component of your superannuation fund is taxed at 17% on the payout.

It is therefore important as part of any Financial Planning/Estate Planning to be aware of this as the tax can be substantial. There are some planning strategies that may help depending on the individuals’ circumstances.

Please talk to us if you have concerns with your own situation or need more information.

THIS WEEKS BRAIN TEASER 

With investment property being such a HOT TOPIC.. Question; Is it better to have:

  • A Negatively Geared Investment Property
  • A Neutrally Geared Investment Property
  • A Positively Geared Investment Property

For example, using a Property Value of say $400,000 borrowings of $320,000 and current interest rates of say 3% per annum or longer-term average of say 6% per annum

All Ordinaries (XAO) 5 Day Chart

All ordinaries for 15th of June 2021
Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
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Market Insights – 21/06/2021

Market Insights – 15/06/2021

Market Insights

15th June 2021

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CBA

$101.36

-0.87%

 

FMG

$23.22

-0.34%

BHP

$48.95

-0.91%

 

ANZ

$28.25

-3.22%

CSL

$296.64

1.42%

 

WES

$55.00

-0.22%

WBC

$26.29

-1.50%

 

WOW

$42.91

-0.81%

NAB

$26.46

-2.72%

 

MQG

$151.56

-1.59%

 

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

7,577.20

0.24%

 

US Dollar

0.7711

Dow Jones

34,393.75

-0.25%

 

Euro

0.6362

FTSE-100

7,146.68

0.18%

 

GB

0.5465

Nikkei 

29,161.80

0.74%

 

Yen

84.8700

Hang Seng 

28,842.13

0.36%

 

NZD

1.0794

 

Commodities

Oil (WTI)

70.090

0.98%

Gold

1,899.800

-1.23%

Iron Ore

211.910

0.58%

 

Major Market Announcements

– Wall Street stocks were mixed at the close of a languid week marked with few market-moving catalysts and lingering concerns over whether longer-term inflation could prompt the U.S. Federal
Reserve to tighten its dovish policy sooner than expected.

– Retail spending on eating out and social activities that Australians have favoured following lockdowns and restrictions is likely to continue growing. The latest retail forecasts report from Deloitte Access Economics’ David Rumbens says Canberra is likely to record a bumper year in 2020-21, with 9.1 per cent retail growth up from less than 1 per cent over the pandemic year.

In the next few months, Afterpay will unveil its foray into retail banking, initially offering Westpac-backed transaction accounts aimed at millennial and Generation Z female shoppers.

Women make up just 29 per cent of Australia’s tech sector. An Australian Computer Society Digital Pulse report warned without major steps to address the issue, the lack of women could cost the economy $11 billion over the next 20 years. Canberra’s tech sector is booming with a 16.3 per cent increase in jobs in the past year; four times national growth.

Iron ore — a critical ingredient in steelmaking — is now fetching an eye-watering US$217 a tonne after a week of sustained gains. That is more than double the price of what it was a year ago. This comes despite more tough talk and threats via Chinese state media this week to send Australia into a “wintry period” by wiping more than $81 billion from our economy.

The biggest float in years on the ASX has kicked off with the release of online property conveyancer PEXA’s prospectus but an equally big test awaits its float manager – the $55 billion investment banking juggernaut Macquarie Group – which cannot afford another initial public offering (IPO) failure. PEXA’s prospectus, lobbed on Monday, said the company was aiming to commence trading on the ASX at the start of July.

The conveyancing platform, owned by Link Administrative Holdings, Morgan Stanley Infrastructure Partners (MSIP) and Commonwealth Bank, is hoping to raise $1.175 billion through the IPO, issuing its stock at an offer price of $17.13 a share. At this price the company will have a market capitalisation of $3 billion and an enterprise value of $3.3 billion.

Market Update

Materials and technology stocks have helped the ASX to a record close for a second consecutive day.

Materials shares gained 1.33 per cent and technology improved by 1.29 per cent as investors remained calm after higher-than-expected US inflation data.

The benchmark S&P/ASX200 index closed higher by 9.8 points, or 0.13 per cent, to 7312.3 on Friday.

The index came within about five points of its all-time high.

The All Ordinaries closed up by 18.4 points, or 0.24 per cent, to 7577.2.

For the week, the market gained 0.23 per cent.

The Australian dollar was buying 77.62 US cents at 1617 AEST, higher from 77.40 US cents at Thursday’s close.

BetaShares Australian EX-20
Portfolio Diversifier (ASX: EX20)

Some 15 months have passed since the first real effects of the CORONAVIRUS on share markets around the World. The following table illustrates what has transpired with the majority of major countries recovering. Of course over that 15 month period, there have been many ups and downs.

World Shares Chart

Regardless of the Covid situation, the purpose of the above table is to clearly and simply highlight the very different and considerable magnitudes in recovery of markets around the World.

It all goes well to further stress the importance of investing globally not just locally. Australia is only a small player in some of the significant growth aspects of the World and the major wealth of the World. Hence, it is clear that when looking for investment opportunities then – INTERNATIONAL SHARE INVESTING – should not be excluded.

With modern technology individuals can gain access to International Shares very easily and with minimal amounts via way of Exchange Traded Funds (ETF’s).

Of course, we always recommend taking at least a 7 year plus period as an ideal investment time frame but the exercise highlights the need for an investment portfolio that includes exposure to international shares as paramount.

At Plus 1 we are available at any time to discuss issues of this nature with due regard to your investments or financial planning generally.

Brain Teaser

Last weeks question:

For the Pre and Post COVID period to date (let’s say 31 Dec 2019 to 31 May 2021 – 17 months) what has been the better performing share-based Exchange Traded Fund:

An investment placed in an Exchange Traded Fund (ETF) that invested straight across the whole ASX200 – being the top 200 companies in Australia.

OR

An investment placed in an Exchange Traded Fund (ETF) that invested straight across the whole ASX200 but excluded the top 20 companies in Australia.

Answer:

For comparison purposes we have chosen two ETF funds as below for the 17-month period 31 Dec 2019 (PRE COVID) to the present 31 May 2021: 

  • BetaShares – ETF with whole ASX 200 companies – total return over 17 months –positive 5.88% plus dividends
  • BetaShares – ETF with ASX 200 companies minus top 20 companies – total return over 17 months – negative 0.15% plus dividends

Although it is a relatively short time for an investment period the intention is to show that despite the total Australian share market falling some 33% plus from 20 Feb 2020 to 20 Mar 2020 the recovery since (whilst across the board in the main) there has been more upside in the financial (big banks and mining mainly) sector so the A200 has outperformed.  

Whilst this has been good for a lot of Australian investors you get a very different story on the growth of shares (and various sectors) the longer you go out and especially over 7 years plus time frames.

THIS WEEKS BRAIN TEASER 

What happens to my remaining superannuation funds from a tax point of view when I die: 

  • If I have a partner who is financially dependent on me OR

I am single and/or have no persons who are financially dependent on me.

All Ordinaries (XAO) 5 Day Chart

All ordinaries for 15th of June 2021
Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

9 + 4 =

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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 21/06/2021

Market Insights – 07/06/2021

Market Insights

7th June 2021

Top ASX Stocks

CODE

PRICE

CHANGE

CODE

PRICE

CHANGE

CBA

$102.52

1.79%

FMG

$22.97

2.54%

BHP

$48.75

0.93%

ANZ

$29.20

1.04%

CSL

$291.37

0.77%

WES

$55.24

-0.65%

WBC

$26.87

1.51%

WOW

$43.35

3.29%

NAB

$27.51

1.33%

MQG

$154.00

1.21%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

7,543.30

0.43%

 

US Dollar

0.7738

Dow Jones

34,756.39

0.52%

 

Euro

0.6361

FTSE-100

7,069.04

0.07%

 

GB

0.5465

Nikkei 

28,941.52

-0.40%

 

Yen

84.7680

Hang Seng 

28,918.10

-0.17%

 

NZD

1.0730

Commodities

Oil (WTI)

68.930

0.64%

Gold

1,871.200

1.08%

Iron Ore

208.000

-0.82%

Major Market Announcements

– Overnight, better-than-expected US employment data raised expectations of higher inflation and an earlier tapering of Federal Reserve stimulus. US Treasury yields jumped, lifting the US dollar and pulling down tech shares. Wall Street closed lower.

– Home buying across Australia is still surging with latest figures revealing a big bump in new mortgages being committed. Latest lending indicators collected by the Australian Bureau of Statistics has revealed new loans for housing rose 3.7 per cent in April, compared to the prior month.

– PayPal has introduced a new feature enabling transfers from PayPal balance to domestic bank accounts and Visa debit cards within one minute. The feature uses the New Payment Platform (NPP) through PayPal’s partnership with the National Australia Bank (NAB) and Visa’s real-time payments platform, Visa Direct.

– COVID-19 has impacted The Reject Shop’s (TRS) second half more than originally forecasted. The virus has continued to affect sales, with January and February figures hit by the Brisbane, Perth and Victoria lockdowns as well as the changing border restrictions. Additionally, stores in CBD locations and large shopping centres continue to be negatively impacted by reduced foot traffic.

– Netlinkz Ltd (ASX: NET) has raised about $15 million via its fully underwritten 1 for 4.2 entitlement offer. The company’s revenue in the third quarter of financial year 2021 rose 85% to $2.9 million over the corresponding period of 2020 with Asia continuing to lead the growth, particularly China. 

Market Update

Shares extended all-time highs on the Australian market, and overseas inflation data appears the only immediate obstacle to rising portfolio values.

The ASX200 benchmark index rose as high as 7300.5 points then eased slightly to close up 35.3 points, or 0.49 per cent, on Friday.

The All Ordinaries closed higher by 32.6 points, or 0.43 per cent, to 7543.3.

The ASX had a record-breaking week. The market hit a record high early on Monday, then improved through the week.

The ASX had its third consecutive week of gains and rose 1.61 per cent.

The Australian dollar was buying 76.68 US cents at 1724 AEST, lower from 77.30 US cents at Thursday’s close.

BetaShares Australian EX-20
Portfolio Diversifier (ASX: EX20)

Did you know that the financial sector makes up 28.30% of Australia’s Top 200 Shares? In fact, the Commonwealth Bank makes up 7.27% of that percentage alone. If you are constructing a portfolio, or looking to compliment your existing share holdings, which may mainly be a portfolio with Blue-Chip Shares, then the BetaShares Australian EX-20 Portfolio Diversifier (ASX: EX20) could be a perfect fit!

EX-20 is an Exchange Traded fund (ETF) that provides exposure to 180 stocks listed on the Australian Stock Exchange, ranked from number 21 to number 200, based on their market capitalisation.

What we like:

Diversification; With a single trade, you gain exposure to a broad portfolio of Australian shares, across industry sectors and individual securities.

Cost effective; Fund tracks the performance of an index (no “active manager” fees)

Liquidity; trades on ASX during the trading day, like any share.

Consider your options with your investments, and feel free to contact us for a personalised consultation.

Brain Teaser

Last weeks question:

With so much talk on the possible breakout of inflation (and hence an increase in the cost of goods and services) due to huge stimulus measures of governments around the World then it is good to reflect on past CPI (inflation figures).

What is the average annual CPI for the past 5 decades ending:

Decade ending 31 Dec 1979 _____________%
Decade ending 31 Dec 1989 _____________%
Decade ending 31 Dec 1999 _____________%
Decade ending 31 Dec 2009 _____________%
Decade ending 31 Dec 2019 _____________%

Answer:

Decade ending 31 Dec 1979 –   9.20% pa
Decade ending 31 Dec 1989  –   9.1% pa
Decade ending 31 Dec 1999  – 2.20% pa
Decade ending 31 Dec 2009 –  3.20% pa
Decade ending 31 Dec 2019  – 2.20% pa

As can be seen, inflation (CPI) has reduced considerably over the last 50 years. When investing it is always important to keep in mind that we should seek returns above inflation – so we at least keep pace with what our money can buy. Hence most of us should have at least some exposure to Australian Shares and/or International Shares and/or Property based investments to achieve this. At some stage, The Worlds on average low inflation will pick up to higher inflation as this is a normal part of economic cycles.

To further highlight, you would need $5,027 today to have the same purchasing power of $1,000 in December 1979.

THIS WEEKS BRAIN TEASER 

For the Pre and Post COVID period to date (let’s say 31 Dec 2019 to 31 May 2021 – 17 months) what has been the better performing share-based Exchange Traded Fund:

An investment placed in an Exchange Traded Fund (ETF) that invested straight across the whole ASX200 – being the top 200 companies in Australia.

OR

An investment placed in an Exchange Traded Fund (ETF) that invested straight across the whole ASX200 but excluded the top 20 companies in Australia.

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

8 + 15 =

CPA Logo
Professional Standards Legislation logo
Platinum Xero Partner
MYOB logo
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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 21/06/2021

Market Insights – 01/06/2021

Market Insights

1st May 2021

Top ASX Stocks

CODE PRICE CHANGE   CODE PRICE CHANGE
CBA $100.56 2.61%   FMG $22.12 0.68%
BHP $48.16 1.30%   ANZ $28.86 3.44%
CSL $289.12 1.75%   WES $55.53 1.95%
WBC $26.46 2.76%   WOW $41.91 0.87%
NAB $27.09 2.03%   MQG $152.47 1.93%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

7,424.00

2.08%

 

US Dollar

0.7709

Dow Jones

34,529.45

0.54%

 

Euro

0.6322

FTSE-100

7,022.61

-0.04%

 

GB

0.5434

Nikkei 

29,149.41

2.27%

 

Yen

84.7020

Hang Seng 

29,124.41

2.78%

 

NZD

1.0635

 

Commodities

Oil (WTI)

66.640

0.89%

Gold

1,906.700

1.17%

Iron Ore

205.730

-1.19%

Major Market Announcements

– Australia’s wine industry prepares to call in the World Trade Organization over China tariffs. Winemakers and grape growers argue Beijing needs to be dobbed into the World Trade Organization (WTO) after it imposed crippling tariffs on Australian wine last year

– Rupert Murdoch’s News Corp Australia is in advanced talks with a consortium backed by high-profile bookmaker Matthew Tripp to launch a new wagering outfit that would reshape both the local industry and the battle for Tabcorp’s betting division.

– Canberra is resisting widespread calls to financially back Victorian workers affected by a snap coronavirus lockdown. There are hundreds of thousands of hospitality staff impacted by the week-long restrictions.

– Financial regulator APRA to stress-test banks on climate change, to examine what would happen in a 3-degrees-hotter world.

– Controversial tech group Nuix has cut ties with former chairman Tony Castagna just days after the Australian Federal Police confirmed it was investigating the venture capitalist over possible breaches of the Corporations Act.

Market Update

The ASX200 notched a record high close and the All Ordinaries a record high as investors made a mockery of the saying “sell in May and go away”.

A broad rally helped the ASX gain more than 1% and beat both records which stood since May 10.

The benchmark S&P/ASX200 index closed up by 84.6 points, or 1.19%, to 7179.5 on Friday.

The ASX200 came within 11 points of a record intra-day high.

The All Ordinaries closed higher by 80 points, or 1.09%, to 7424.

The index had a record intra-day high of 7431.4.

Materials shares were best and rose 1.88%.

The Australian dollar was buying 77.16 US cents at 1624 AEST, lower from 77.45 US cents at Thursday’s close.

Brain Teaser

LAST WEEKS QUESTION:
The May 2021 Federal Budget speech is just behind us with projected Federal Government Debt of $1 Trillion in a few years. It is hard to get a handle on the pure size of this being $1 million times a 1000 times a 1000. A good way to look at it is this weeks Brain Teaser being:

“What is the debt per each Australian person if it was split evenly amongst us?”

ANSWER:

With approximately 25 million people in Australia, for every man, woman and child we each have approximately $40,000 of debt among us.

Somewhere along the line this means that we will pay this back (effectively to the government who has borrowed it to keep the country/economy running – which is us) in some gradual way. A result of many years of budget deficits and more recently, huge stimulus measures.

THIS WEEKS BRAIN TEASER:

With so much talk on possible breakout of inflation (and hence an increase in cost of goods and services) due to huge stimulus measures of governments around the World then it is good to reflect on past CPI (inflation figures).

What is the average annual CPI for the past 5 decades ending:

Decade ending 31 Dec 1979 _____________%
Decade ending 31 Dec 1989 _____________%
Decade ending 31 Dec 1999 _____________%
Decade ending 31 Dec 2009 _____________%
Decade ending 31 Dec 2019 _____________%

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

15 + 12 =

CPA Logo
Professional Standards Legislation logo
Platinum Xero Partner
MYOB logo
Quickbooks logo

Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 21/06/2021

Market Insights – 17/05/2021

Market Insights

17th May 2021

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CBA

$96.58

2.85%

 

FMG

$22.79

-4.40%

BHP

$49.57

-1.84%

 

ANZ

$27.42

1.18%

CSL

$277.68

1.53%

 

WES

$54.20

0.00%

WBC

$25.41

-2.83%

 

WOW

$40.58

1.58%

NAB

$26.22

-2.60%

 

MQG

$158.34

0.46%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

7,239.40

-1.73%

 

US Dollar

0.7782

Dow Jones

34,382.13

-1.62%

 

Euro

0.6406

FTSE-100

7,043.61

-1.33%

 

GB

0.5517

Nikkei 

28,084.47

-5.16%

 

Yen

85.0980

Hang Seng 

28,027.57

-2.72%

 

NZD

1.0735

Commodities

Oil (WTI)

65.490

0.88%

Gold

1,845.700

0.45%

Iron Ore

210.080

-2.51%

 

Major Market Announcements

– Treasurer Josh Frydenberg has sidestepped tough questions about whether low and middle income earners will be worse off next financial year during a tense exchange on ABC TV about the federal budget. The government extended its Lower and Middle Income Tax Offset (LMITO), a rebate of up to $1080 for singles and $2160 for couples, in Tuesday’s budget, but it will end after the next financial year, cutting the take-home pay for workers in future years.

– Commonwealth Bank (CBA) has hit an all-time high with its share price jumping to a record price of $97.38 per share.

– Bitcoin’s crash is very bad news for other cryptos. Elon Musk’s surprise reversal on accepting bitcoin payments for Tesla (TSLA) cars has triggered a sharp plunge in the cryptocurrency — spelling trouble for other coins that have notched shocking returns in recent months.

– Afterpay’s (APT) shares dropped to an intraday low of $81.85 on May 13, marking an eight-month low for the buy now, pay later darling. It marks a sobering turn for a company that enjoyed a 2021 high point in February, when APT shares traded around $154 apiece.

– Shares in heavily shorted AMC Entertainment Holdings (AMC.N) were up 4.0% in heavy trading on Friday, with the cinema operator the top focus on social media forums popular among retail investors.

Market Update

Commonwealth Bank shares reached a new record price as investors overcame inflation fears and helped the Australian market finish higher.

Shares in the nation’s biggest bank reached $97.38 before closing higher by 0.63 per cent to $96.58.

There was a broad-based rally after three days of losses on the ASX. The losses were partly due to the biggest jump in US prices in 12 years.

The benchmark S&P/ASX200 index closed lower by 31.5 points, or 0.45 per cent, to 7014.2.

The All Ordinaries closed down 30.4 points, or 0.42 per cent, to 7239.4 points.

The Australian dollar was buying 77.31 US cents at 1622 AEST, higher from 77.22 US cents at Thursday’s close.

Federal Budget – 5 Things You Should Know

1. The Low and Middle Income Tax Offset (LMITO) Extended: LMITO has been extended for another year. This is worth up to $1,080 for individuals with taxable incomes up to $90,000. Between $90,000 and $126,000 the $1,080 offset reduces by 3 cents in the dollar until it reduces to nil at $126,000.

2. No More Work Test: From 1 July 2022, individuals aged 67 to 74 will no longer be required to meet the work test when making or receiving, non-concessional superannuation contributions or salary sacrificed contributions. However, access to concessional personal deductible contributions for individuals aged 67 to 74 will still be subject to meeting the work test.

3. Downsize Earlier: From 1 July 2022, the minimum age for the downsizer contribution will be lowered from 65 to 60. This will allow Australians nearing retirement to make a one-off post-tax contribution of up to $300,000 per person (or $600,000 per couple) when they sell their family home.

4. First Home Buyer Super Savings Increase: From 1 July 2022, the Government will increase the maximum amount of voluntary contributions that can be released under the First Home Super Saver Scheme from $30,000 to $50,000.

5. First Home Buyers Scheme: The government’s first home buyer’s scheme will be boosted by another 10,000 places, where buyers will only need a five per cent deposit to secure a home without paying Lenders Mortgage Insurance (LMI). There will also be a new initiative which will see single parents able to purchase a home with just a two per cent deposit (without paying LMI).

Brain Teaser

LAST WEEKS QUESTION:

What are the Age Requirements as well as the Income and Assets Test to be eligible to receive the Commonwealth Seniors Health Care Card (CSHCC) and what are the benefits of having this card?

ANSWER:

The Age Requirements are essentially moving from age 66 (now) to age 67 (in the future) as below: 


Age Pension Age

Date of Age Pension
Age Change

 

1 January 1954 to 30 June 1955

66 years

1 July 2019

1 July 1955 to 31 December 1956

66 years and 6 months

1 July 2021

On or after 1 January 1957

67 years

1 July 2023

To be eligible for the CSHCC, the income test is that your adjustable taxable Income must be below the following:

Single – $55,808 per annum
Couple – $89,290 per annum

The benefits of having the CSHCC are:

  • Cheaper medical costs
  • Bulk billing depending on doctor.
  • Some reduced property and water rates, electricity costs and  public transport costs depending on your state and local government authorities concessions.

So even if we do not receive any Age Pension, the CSHCC income tests are not too stringent. For most of us the cheaper medicines is the critical benefit.

THIS WEEKS BRAIN TEASER

Since 1981 (last 40 years) what has been the biggest % drop and biggest % rise in market values for the Australian Share market for any financial year (ending 30 June each year)?

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
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F: (03) 5831 2988
Email Us

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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 21/06/2021

Market Insights – 10/05/2021

Market Insights

10th May 2021

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CBA

$93.92

4.97%

 

FMG

$22.97

1.19%

BHP

$50.09

5.61%

 

ANZ

$27.75

-3.88%

CSL

$274.51

0.87%

 

WES

$54.26

0.28%

WBC

$26.09

1.48%

 

WOW

$39.42

-0.33%

NAB

$26.78

0.11%

 

MQG

$158.45

-1.38%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

7,325.20

0.14%

 

US Dollar

0.7849

Dow Jones

34,777.76

1.85%

 

Euro

0.6455

FTSE-100

7,129.71

2.05%

 

GB

0.5599

Nikkei 

29,357.82

0.84%

 

Yen

85.2130

Hang Seng 

28,610.65

0.50%

 

NZD

1.0773

Commodities

Oil (WTI)

65.460

1.50%

Gold

1,834.600

2.41%

Iron Ore

204.350

10.44%

Major Market Announcements

– The Reserve Bank has surprised no one with more upbeat expectations for Australia’s economic recovery. But significant monetary support will continue, supporting the creation of wealth by home buyers who can bank on low interest rates for some years

– Bank boom: Big four profits snap back from COVID-19 threat. This time last year, NAB chief executive Ross McEwan was bracing for what many thought would be the worst economic crisis since the 1930s Great Depression

– Treasurer Josh Frydenberg’s third budget on Tuesday will be the centrepiece of the economic calendar this week but there are also crucial figures on retail spending and jobs. Mr Frydenberg is likely to hand down a budget for the 2021/22 financial year that is in far better shape than expected just a few months ago

– Macquarie Group has reported a 10 per cent rise in full-year profit, helped by its markets trading. The group on Friday revealed net profit after tax of $3.01 billion for the 12 months to March 31

Market Update

Iron ore miners have helped Australian shares to their first week of gains in three weeks as the steel-making commodity fetched a record price.

Fortescue Metals and Rio Tinto gained about one per cent after iron ore prices topped $US200 per tonne in futures trading due to Chinese steelmakers’ demand.

The benchmark S&P/ASX200 index on Friday closed higher by 19.1 points, or 0.27 per cent, to 7080.8.

The All Ordinaries closed up 19.2 points, or 0.26 per cent, to 7325.2 points.

For the week, shares were better by 0.78 per cent.

The Australian dollar was buying 77.67 US cents at 1621 AEST, higher from 77.41 US cents at Thursday’s close.

Are You Investing Or Speculating?

Unless you have been living under a rock, you would have heard about the rise of Cryptocurrencies over the past several months.

This rise in value has seen many people begin to put more and more money into these assets in the hope that they will continue to rise in value. As more people put money into these assets, the values go higher and higher and so on. We are not going to give my opinion on whether we think Bitcoin and other cryptocurrencies are good investments or not. This would be pure speculation.

But it does pay to ask the question, are you investing, or are you speculating?

The main difference between investing and speculating is the amount of risk you are taking on to try and get a return. High-risk speculation has many similarities to gambling, whereas investing uses a basis of fundamentals and analysis.

Investing typically involves diligent analysis of the underlying fundamentals to determine whether an asset is under, over or fairly valued. An investor then based on this analysis, can make an informed decision as to whether or not they should invest in a particular asset. This can be a company, a property, a commodity or other asset that can appreciate in value. 

Speculating on the other hand is putting your money into an asset and just hoping it will increase in value. Usually, speculators seek abnormally high returns in a short period of time. A bet so to speak. If I buy this asset today, I hope it will be worth significantly more in a week or a month from now. 

Speculating can see you make a lot of money very quickly. This is what is happening now and as more and more people make quick, abnormally high returns, others who are not speculating get a fear of missing out (FOMO) and then decide to jump in, hoping of getting similar returns.

This is where the real danger lies in speculating. Speculators are looking at past returns and hoping it will continue. It may continue, but it also may not.

The number of conversations we have had over the past couple of months regarding how to buy Bitcoin and other cryptocurrencies has increased dramatically. The same conversations were happening during the last Crypto boom and that ended in tears.

We are not saying you should or shouldn’t buy Bitcoin or other cryptocurrencies. What we are saying is to be diligent and do your research.

Every one is now an expert because they may of made a quick buck. Winning a bet doesn’t make you an expert. How many of these people can actually explain what cryptocurrency is and why it is worth what it is?

If they cannot answer this question, they are speculating. 

It is important to do your own research and to not put more than you are willing to lose into these high risk assets.   

Brain Teaser

LAST WEEKS QUESTION:
Investments can go into a number of tax vehicles or structures. Whilst we are great believers in the QUALITY of INVESTMENTS and POTENTIAL RETURN is first and foremost, doing what we can to save some tax (within the legislative frameworks set) is obviously important but secondary to the main game.

What is the percentage tax scale payable on the following tax structures?

Individual Name/s – _____
Company – _____
Superannuation Fund – _____
Super Pension Account – _____
Investment Bond – _____
Discretionary Trust – _____

ANSWER:

Individual Name/s – Marginal Tax Rate of Person
Company – 27.50 % or 30% depending on size of company
Superannuation Fund – Maximum of 15%
Super Pension Account – Nil%
Investment Bond – 30%
Discretionary Trust – Depends on Who Income is Distributed to

Most tax structures allow investment in the various categories of investment including Cash/Fixed Interest/Shares/Property.

Considerations of the appropriate tax vehicle for your investments will depend on a number of factors including:

  • Certainly one’s own marginal tax rate dependent on other employment income and the like.
  • Need of income – now or later
  • Preference of more Income or more Capital Growth – what is needed
  • Time Frame
  • Desired use of any franking credits
  • Liquidity needed down the track
  • Your overall full investment portfolio
  • Future possible Capital Gains considerations

Invariably for most of us the use of a number of tax vehicles will be appropriate.

THIS WEEKS BRAIN TEASER:

What are the Age Requirements as well as the Income and Assets Test to be eligible to receive the Commonwealth Seniors Health Care Card and what are the benefits of having this card?

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

3 + 4 =

CPA Logo
Professional Standards Legislation logo
Platinum Xero Partner
MYOB logo
Quickbooks logo

Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide