Market Insights – 23/11/2020

Market Insights – 23/11/2020

Market Insights

23rd November 2020

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CSL

$313.53

-0.05%

 

ANZ

$22.34

7.40%

CBA

$80.00

8.11%

 

WES

$49.16

0.63%

BHP

$36.14

-0.74%

 

WOW

$38.07

-0.65%

WBC

$19.91

7.04%

 

MQG

$136.67

-3.14%

NAB

$22.73

5.23%

 

FMG

$16.95

0.95%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

6,739.90

-0.04%

 

US Dollar

0.7307

Dow Jones

29,263.48

-0.75%

 

Euro

0.6164

FTSE-100

6,351.45

0.27%

 

GB

0.5496

Nikkei 

25,527.37

-0.42%

 

Yen

75.9187

Hang Seng 

26,451.54

0.36%

 

NZD

1.0550

Commodities

Oil (WTI)

42.15

1.03%

Gold

1,872.400

0.59%

Iron Ore

122.840

0.42%

Major Market Announcements

– U.S. stocks closed lower on Friday as investors wrestled with fiscal stimulus developments, concerns over a lengthy rollout of vaccines, and a growing number of state-level shutdowns to combat the spiraling COVID-19 pandemic.

– Coles has temporarily shut down one of its major Sydney warehouses after hundreds of its workers went on strike over pay and conditions. More than 350 workers are employed at the Smeaton Grange distribution centre which will now be closed for three months. It is one of the largest such facilities in NSW.

– Carsales Australia boss Ajay Bhatia says higher prices for second-hand cars are here to stay for some time to come as consumers pay top dollar for vehicles posted on the online car classifieds group’s platform.

– Facebook fed inaccurate information to local advertisers for more than a year and is being forced to repay them, casting further doubt over the accuracy of the way the US tech platform collects data.

– Dropbox is betting on people sticking with their home offices even after the COVID-19 pandemic has ended, as the cloud storage company reinvents itself from a business tool to a working from home platform.

– A 2025 increase to superannuation could be scrapped after an independent review found current policy settings are working well enough. The Morrison government has committed to boosting super from 9.5 per cent to 12.5 per cent by 2025 in a move backed by the opposition. However, the Coalition is now paving the way for the super boost to be tossed after the long-awaited Retirement Income Review found Australia’s current retirement income system to be “effective, sound and … broadly sustainable”.

– Millions of Commonwealth Bank debit card holders are now able to get cash out with over-the-counter Apple Pay transactions after eftpos was added as a payment option on the Cupertino platform.

– Insurance Australia Group is building up a big cash war chest in anticipation it will be hit by a tsunami of pandemic-related business interruption claims after a court ruled in favour of policy holders in a landmark test case. Late on Wednesday, the NSW Court of Appeal rejected the insurance industry’s argument that policies should not cover losses suffered by its business clients due to COVID-19, sparking expectations of huge payouts on the horizon.

– Regis Healthcare (REG) has shot down a $555 million takeover bid from investment giant Washington H. Soul Pattinson (SOL) and major shareholder Ashburn. WHSP, also known as Soul Patts, lobbed the bid yesterday, offering a neat $1.85 per Regis share for full control of the aged care provider. Ashburn, who partnered with Soul Patts on the bid, already holds a 27.2 per cent interest in Regis.

Market Update

Investors’ shares have finished the session barely lower on the Australian market but had a third consecutive week of gains.

The S&P/ASX200 benchmark index closed down eight points, or 0.12 per cent, to 6539.2 on Friday.

The All Ordinaries closed lower by 2.8 points, or 0.04 per cent, to 6739.9.

The indices were set to record minor gains but dipped sharply after the close of trade at 1600 AEDT.

The ASX200 gained 2.09 per cent for the week.

The Aussie dollar was buying 72.92 US cents at 1621 AEDT, lower from 72.93 US cents at Thursday’s close.

Brain Teaser

Last Week’s Question

If you purchased an investment property say 12 years ago in 2008 for $230,000 and it has grown to $400,000 today what has been the average compound capital growth return over the 12 years (exclude rent for this exercise)  

Answer  

The compound average rate of return for the 12 years is 4.72% per annum. Relative to inflation this is fairly reasonable per annum growth. Of course you would also include any net rental income (as a percentage) of the investment property to determine the total income and growth return.  This calculation would depend on how the investment property was purchased, cash or borrowed monies, amongst other matters.

This Week’s Question

What percentage of my superannuation retirement monies am I allowed to draw each year in the form of a pension for my living expense and other needs for the following ages:

Age 60 –  ____%
Age 65 –  ____%
Age 70- ____%
Age 75 – ____%

Please read the question carefully!

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.

Open Hours

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

Closed Public Holidays

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Market Insights – 23/11/2020

Market Insights – 16/11/2020

Market Insights

16th November 2020

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CSL

$309.46

1.97%

 

ANZ

$20.58

7.24%

CBA

$73.14

4.68%

 

WES

$48.52

1.46%

BHP

$35.77

1.82%

 

WOW

$38.06

-3.03%

WBC

$18.34

3.09%

 

MQG

$141.17

4.22%

NAB

$21.20

8.38%

 

FMG

$16.59

-1.60%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

6,609.30

-0.15%

 

US Dollar

0.7264

Dow Jones

29,479.81

1.37%

 

Euro

0.6136

FTSE-100

6,316.39

-0.36%

 

GB

0.5511

Nikkei 

25,385.87

-0.53%

 

Yen

76.0420

Hang Seng 

26,156.86

-0.05%

 

NZD

1.0617

Commodities

Oil (WTI)

40.110

-1.96%

Gold

1,885.700

0.59%

Iron Ore

121.000

-0.17%

Major Market Announcements

– The S&P 500 notched a record closing high on Friday with upbeat earnings reports helping to drive optimism about the economy along with hopes for successful COVID-19 vaccines, even as investors monitored a surge in virus cases and restrictions around the country.

– Four mates who launched non-alcoholic beer company Heaps Normal during the coronavirus lockdown have raised $1.3 million from investors, including prominent start-up founders, as they look to tap growing demand for alcohol-free drinks. “Although it was a terrible situation — and for our industry and a lot of businesses in it, it was quite catastrophic — it was unexpectedly positive for us to launch in the middle of lockdown,” co-founder and chief executive Andy Miller said.

– Commonwealth Bank says there is not enough information about how to combat the hidden epidemic of financial abuse plaguing Australia. A new report commissioned by the major bank and the University of New South Wales has revealed financial institutions have a systemic problem of not being able to easily identify or define cases of financial or economic abuse within banking systems.

– Nuix is set to become Macquarie’s most successful investment as the forensic software company prepares to lodge its prospectus on Wednesday for an initial public offering valuing it at $1.8 billion. In what promises to be the biggest float of the year Nuix’s initial public offering will comprise a primary issue of new shares of $100 million and a sell down of $875.3 million with the company expected to list on the ASX on 4 December.

Market Update

Australian shares have slipped for a second consecutive day as the initial excitement over coronavirus vaccines subsided and investors cashed out after a strong post-election rally.

In that context, the surging number of COVID-19 infections in the world’s biggest economy, the United States, did not help with investor sentiment either.

The ASX 200 closed 13 points (or 0.2 per cent) lower at 6,405.

Global stocks were dragged down further after the US Federal Reserve and European Central Bank said the economy was still in for a tough time, while the Bank of England said there was still a long way for drug trials to go.

“You have not only one, but three heads of the central banks around the world just commenting on the fact that the economic picture is still pretty dire at the moment, so that will definitely have some weight on investor sentiment,” said James Tao, market analyst at CommSec.

Overall, the benchmark index was up 3.5 per cent over the past week and has climbed an even stronger 8.1 per cent since the month began.

Meanwhile, the Australian dollar slipped (-0.7pc) to 72.2 US cents.

This was mainly due to “concerns that lockdowns in parts of the US would further weigh on global growth” and uncertainty over the Australia-China trading relationship, according to Commonwealth Bank currency strategist Kim Mundy.

Brain Teaser

Last weeks Brain Teaser

If you are a couple, retired at age 60 (both) and want to live on $52,000  per annum (and want to ensure these living expenses keep pace with inflation) and you expect to live to life expectancy of approximately age 87. How much investment capital do we need at age 60 to make this happen

  1. Assuming the capital runs down to zero at age of death say 87
  2. Assuming the capital amount is kept intact the whole 27 years

Answer

If you are happy to run down your investment capital to zero at age 87 you would need $500,000 at full retirement at age 60.
You would need $635,000 if you want your investment capital to remain intact at age 87 by still having $635,000 at that time.
Assumptions:

  • You are a couple of similar ages
  • Investment earnings of average 6% per annum (income and growth)
  • Inflation of 3% per annum (so living expenses increase in line with this)
  • Centrelink entitlements factored in – part Age Pension initially from age 67
  • Bulk of your investment capital is in superannuation allocated pensions.

We build our capital up for retirement. Sometimes it is important to remember we may need to run some of the capital down for maintaining lifestyle reasons during our formative years.

This Weeks Brain Teaser

If you purchased an investment property say 12 years ago in 2008 for $230,000 and it has grown to $400,000 today what has been the average compound capital growth return over the 12 years (exclude rent for this exercise)  

Brain Teaser

GOALS: Create clear, appropriate investment goals
BALANCE: Develop a suitable asset allocation using broadly diversified funds
COST: Minimize cost; where appropriate
DISCIPLINE: Maintain perspective, and a long-term discipline

The best way to work toward an investment goal is to start by defining it clearly, take a level-headed look at the means of getting there, and then create a detailed, specific plan. Being realistic is essential to this process. Asset allocation and diversification are powerful tools for achieving an investment goal. Broad diversification reduces a portfolio’s exposure to specific risks while providing opportunity to benefit from the markets’ current leaders.

The lower your costs, the greater your share of an investment’s return, and the greater the potential impact of compounding.

Because investing evokes emotion, even sophisticated investors should arm themselves with a long-term perspective and a disciplined approach. Abandoning a planned investment strategy can be costly, and research has shown that some of the most significant reasons for derailment are behavioural: the failure to rebalance, the allure of market-timing, and the temptation to chase performance. Far more dependable than the markets is a program of steady saving. Making regular contributions to a portfolio, and increasing them over time, can have a surprisingly powerful impact on long-term results.

Please contact our friendly team to discuss your financial circumstances, goals and future plans!

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.

Open Hours

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

Closed Public Holidays

Plus 1 Group logo

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

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
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 – 23/11/2020

Market Insights – 09/11/2020

Market Insights

9th November 2020

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CSL

$301.99

4.57%

 

ANZ

$19.66

3.04%

CBA

$69.79

0.16%

 

WES

$47.72

3.97%

BHP

$34.67

1.70%

 

WOW

$38.96

1.51%

WBC

$17.77

-1.71%

 

MQG

$135.45

7.23%

NAB

$19.57

3.82%

 

FMG

$16.55

-4.78%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

6,395.00

4.25%

 

US Dollar

0.7277

Dow Jones

28,323.40

5.98%

 

Euro

0.6122

FTSE-100

5,910.02

6.24%

 

GB

0.5529

Nikkei 

24,325.23

4.54%

 

Yen

75.1620

Hang Seng 

25,712.97

5.70%

 

NZD

1.0715

Commodities

Oil (WTI)

37.140

0.90%

Gold

1,952.000

2.75%

Iron Ore

117.630

-0.05%

Major Market Announcements

– Macquarie Group has reported a 32 per cent dive in half-year profit after the impact of the coronavirus caused the bank to write down the value of assets such as its aircraft leasing operations.

– Simmering tensions between Australia and its largest trading partner China looked as though they may come to a head on Friday. Australian exporters and producers nervously waited to see if a rumoured blockade on Australian goods, including wine and rock lobsters, would take effect.

– The Australian economy continues to show flickers of light, strengthening the case our recession is over. On 4 November, investors learned retail trade rose by 6.5% in the September quarter, adjusted for inflation, surpassing the forecast of +6.0%.

– Crown Resorts pursues profit at all costs and has a culture of disregarding its regulatory obligations, the explosive inquiry into the gambling giant’s alleged facilitation of money laundering has heard. The NSW independent Liquor and Gaming Authority probe heard on Friday that Crown did not conduct annual reviews of lucrative junkets, where high-roller gamblers were flown in from Asia induced by free accommodation and other perks.

Market Update

In a vote of confidence after a huge five days dominated by the US election and a rate cut by the Reserve Bank, Australian stocks have just marked its best week in a month.

The benchmark ASX 200 finished Friday up 0.8 per cent, despite unsubstantiated claims by US President Donald Trump about the election, which raised the chance of a contested result.

Most sectors closed higher, except for slight losses by healthcare and utilities stocks.

Overall, the ASX 200 gained 4.4 per cent over the week.

That was its best week since October 9.

Global equities have gained this week despite uncertainty around the US presidential race, and the growing potential of a Biden presidency that could bring in Democratic policy changes that could impact business.

The All Ordinaries index put on 0.8 per cent to 6,395.

Leading the gains among the top 200 companies were gaming firm Tabcorp (+15.8), News Corporation (+13.7pc) and Resolute Mining (+9pc).

Australian wine company Treasury Wines gained almost 10 per cent over the day, despite further reports about China imposing trade barriers on Australian products such as wine, lobsters and barley.

News Corp increased as investors liked its 21 per cent increase in first earnings and Tabcorp disputed claims of a private equity takeover offer.

Leading the falls on the ASX 200 were media network Nine Entertainment (-3pc), building materials firm CSR (-3pc), payment platform Afterpay (2.7pc) and Cromwell Property (-2.6pc).

Brain Teaser

Last weeks Brain Teaser:

If I purchased a basket of groceries in the year June 2000 for $100, how much cash would I need today, being 20 years later, to buy the same basket of groceries?

 

Answer:

You would need $160 today in order to buy the same $100 basket of groceries you purchased 20 years ago in the year 2000.

This is how inflation can eat away at your purchasing price of money. Inflation has averaged 2.35% per annum over that period. The same applies to your investments (especially in retirement). You need some growth in your portfolio to counteract this loss of purchasing power over time.

This weeks Brain Teaser:
If you are a couple, retired at age 60 (both) and want to live on $52,000 per annum (and want to ensure these living expenses keep pace with inflation) and you expect to live to life expectancy of approximately age 87. How much investment capital do we need at age 60 to make this happen

  1. Assuming the capital runs down to zero at age of death say 87
  2. Assuming the capital amount is kept intact the whole 27 years

Answer next week!

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.

Open Hours

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

Closed Public Holidays

Plus 1 Group logo

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

Contact Us

27 Welsford Street
Shepparton, VIC 3630

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

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 – 23/11/2020

Market Insights – 02/11/2020

Market Insights

2nd November 2020

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CSL

$287.56

-2.96%

 

ANZ

$18.81

-5.00%

CBA

$69.02

-1.33%

 

WES

$45.96

-2.46%

BHP

$33.78

-5.48%

 

WOW

$38.16

-2.18%

WBC

$17.91

-4.94%

 

MQG

$126.75

-6.65%

NAB

$18.60

-4.62%

 

FMG

$17.37

4.64%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

6,133.20

-0.56%

 

US Dollar

0.7022

Dow Jones

26,501.60

-0.59%

 

Euro

0.6026

FTSE-100

5,577.27

-0.08%

 

GB

0.5427

Nikkei 

22,977.13

-1.52%

 

Yen

73.4436

Hang Seng 

24,107.42

-1.95%

 

NZD

1.0612

Commodities

Oil (WTI)

35.610

-1.08%

Gold

1,843.000

0.60%

Iron Ore

120.280

-0.07%

Major Market Announcements

U.S. stock indexes closed lower on Friday to cap Wall Street’s biggest weekly sell-off since March, as losses in richly priced tech heavyweights, a record rise in coronavirus cases and jitters over the presidential election snuffed investor sentiment.

The Federal Government has pledged $500 million in additional foreign aid spending to eliminate COVID-19 in Southeast Asia and the Pacific. Many small countries in these regions have thankfully remained free of coronavirus cases since its outbreak early in the year. Many of the smallest island nations shut their borders in April, in order to protect their vulnerable citizens from the virus.

Commonwealth Bank has been fined $150,000 after increasing a customer’s credit card limit even though he’d warned them he was a problem gambler. The Federal Court heard the bank had already lifted David Harris’ limit before offering to do it again during a phone conversation in October 2016, when he said he did not want it until he was able to get his gambling under control.

1st Group (1ST) has entered a three-year commercial partnership with fintech giant, Afterpay (APT). 1st Group’s customers will be able to access its MyHealth1st platform through the Afterpay Shop Directory and select Afterpay as their preferred payment option for practices that offer Afterpay to their patients. This is expected to increase turnover for practices and drive more patients to the MyHealth1st platform amongst Afterpay’s healthcare network.

Next week Rio Tinto’s Argyle mine, which produces 90 per cent of the world’s pink diamonds, will close, sparking a buy-up from wealthy collectors and investors around the world and marking the end of an era for Mr Milne.

Market Update

Australian shares have just endured their worst week since April, despite a promising start and takeover news buoying some stocks.

The benchmark ASX 200 index started Monday morning on 6,167 points and tracked steadily down all week.

The market dropped almost every day, wiping out all the gains it had made since early October.

It closed Friday at 5,928 points — a 0.6 per cent drop for that day and a 3.9 per cent overall drop since Monday.

The last time the ASX 200 had a week that bad was in April.

Investors refrained from placing big bets ahead of the US presidential election and on concerns that fresh lockdowns would derail global economic recovery.

Some of Friday’s better performing ASX stocks including AMP, which rose almost 20 per cent after the embattled wealth manager said it had received a conditional takeover bid from a US private equity firm, but did not disclose the amount.

By close of trade, healthcare giant Resmed was also up 9.5 per cent to $27.90.

Its shares were in demand after the company said its September quarter profit grew 37 per cent to $US184.4 million, driven by strong sales of its ventilators for coronavirus patients.

Other performers included Rio Tinto (+1.6pc) and Fortescue Metals (+4.5pc).

On the flip side, nickel producer Western Areas (-17.7pc), Carsales (-4.1pc), CSR (-3.3pc) and REA Group (-3.7pc) were some of the weakest performers.

Investors sold off their Western Areas stock after the company lowered its full year production guidance, and said it expected to incur higher costs in the current financial year.

The US Election – What does it mean for your investments?

The lead up to this weeks US Presidential Elections is certainly not like any lead in to an election we have seen before. Enough said on that.

The last 20 years in particular has provided many changes to the investing landscape and we can best describe the changes from more “Traditional” (for the sake of a word) investing to the “Changed World” of investing. History has provided the following.

“Traditional or Historic Investment Environment”

  • US led the World almost solely
  • Bank stocks (big 4 in particular) were the main staple of Australian investors
  • Shares exposure typically home bias and little international exposure except for some superannuation funds exposure
  • Resource stocks like BHP and Rio Tinto seen as must haves in a lot of portfolios.
  • Term deposits 3% to 5% pa rates of return generally the norm.
  • Home loan rates hovered arounds 6% to 8% pa.
  • Inflation closer to average of 3% per annum.
  • Japan previously the second powerhouse.
  • Federal Government in the main mad on ensuring actions towards budget surpluses and budget deficits seen as a no/no at least in the longer term.
  • Own home ownership seen as family’s biggest assets.
  • World leaders in some ways stereotyped individuals (not too flamboyant) or more stable in their approach.

“Changed World Environment”

  • China emergence as a powerhouse
  • Technology incredibly entrenched in our World
  • Historically low interest rates for savers – the search for good/safe yield goes on and getting harder and harder
  • Historically low home loan and investment property loan rates
  • Home loan ownership seen as very difficult for many due to capital city prices despite low interest rates.
  • Superannuation fast emerging as largest asset for some families
  • America in some ways seen as lost the plot.
  • Non-traditional type stocks providing the best growth for investors.
  • Tech and health care stocks at the forefront
  • Individuals can have access to every share in the World with as little as $1,000 and push of a button.
  • Multi trillion-dollar government debts now the norm throughout the World with returns to surpluses (and no long-term government debt) seen as 30 to 50 years away. Acceptance of this as the new norm.
  • The vast methods and sheer magnitude thereof of the Media can almost “kill” or bring down anyone or action they want to
  • And of course, last but not least by any means this year’s pandemic

 

 What Does It All Mean?

US Presidents will come and go and there will generally be some disruption to markets of some sort – positive or negative or just the usual volatility a little more exemplified until the dust settles – a few weeks or months later.

We might say that this time it is different but there is always an argument for that case. History and time will tell – any prediction is just an opinion – no one really knows.

When it comes to growth investments (essentially shares – of all sorts) we must stress that when the dust settles (even in this NEW CHANGED WORLD) it will always be that shares in good companies that have good products, sound management, are reasonably priced and provide good market exposure will continue to be the way forward in managing share portfolios. This applies with your own ordinary investments, superannuation monies or pension funds.

It is the same with investment properties – location, location, location – being the main catalyst as well as ensuring the property is well priced and well presented.

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.

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.

Open Hours

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

Closed Public Holidays

Plus 1 Group logo

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

Contact Us

27 Welsford Street
Shepparton, VIC 3630

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

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 – 23/11/2020

Market Insights – 26/10/2020

Market Insights

26th October 2020

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CSL

$294.82

-2.28%

 

ANZ

$19.78

1.70%

CBA

$69.90

0.07%

 

WES

$46.92

-3.10%

BHP

$36.00

-1.26%

 

WOW

$38.82

-1.35%

WBC

$18.78

-0.48%

 

MQG

$136.18

1.18%

NAB

$19.53

0.62%

 

FMG

$16.72

-0.24%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

6,373.70

-0.16%

 

US Dollar

0.7131

Dow Jones

28,335.57

-0.10%

 

Euro

0.6012

FTSE-100

5,860.28

1.29%

 

GB

0.5463

Nikkei 

23,516.59

0.18%

 

Yen

74.6504

Hang Seng 

24,918.78

0.54%

 

NZD

1.0659

Commodities

Oil (WTI)

39.630

-2.04%

Gold

1,840.000

-0.14%

Iron Ore

121.340

-0.26%

Major Market Announcements

The S&P 500 and Nasdaq closed modestly higher on Friday in choppy trading, with investors keeping a close eye on negotiations on a U.S. stimulus package that would ease the economic shock caused by the coronavirus pandemic.

Qantas shares ended the day up, despite the company stating that it is still being stung by COVID-19. Chief executive Alan Joyce told the company’s AGM on Friday that delays in reopening state borders cost it $100 million over the first quarter of the financial year, with fewer domestic flights operating than expected.

The National Australia Bank will pay another $380 million before tax in compensation for customers for bank and investment advice and fees, $128 million in back pay for staff because of underpayments, and $134 million on expected property write-downs as the bank consolidates office space in Melbourne.

Suncorp warns an onslaught of looming wild weather this summer could blow out the nation’s natural disaster bill and cause insurance premiums to spike. A survey conducted by the major insurer found one in two Australians are deeply concerned the country is not sufficiently prepared to cope with the incoming La Niña summer, which is expected to heighten the chance of hail storms, cyclones and floods.

Energy giant Santos is confident it will be able to give the go-ahead for one of the world’s cheapest carbon capture and storage projects in South Australia as the Morrison government indicates work is progressing to have the technology approved for federal carbon credits.

Market Update

On Friday, Australia’s share market has ended its day with minimal losses and shrugged off the final US presidential debate between US President Donald Trump and Democratic Party candidate Joe Biden.

The ASX 200 index finished just 0.1 per cent down to 6,167, after falling by around 0.4 per cent during the debate.

Miners, technology and healthcare stocks weighed on the market with oil stocks and banks among the gainers.

Many of today’s worst-performing stocks were gold miners, after the precious metal’s spot price fell sharply overnight to just over $US1,900 an ounce.

As of 4:30pm, Friday, AEDT the Australian dollar slipped slightly to 71.07 US cents.

The All Ordinaries fell by nearly 0.2 per cent to 6,374.

Brent crude oil fell 0.3 per cent at $US42.34 a barrel.

Spot gold lifted by just 0.1 per cent to $US1,905.30 an ounce.

Brain Teaser

Last week’s Brain Teaser…

If I am over age 60 and retired how much can I earn from all sources before I pay any income tax.

Answer is…

An individual over age 60 can earn $22,800 per annum from ordinary sources and investments and pay no income tax or Medicare levy. In addition to this tax free threshold an individual over age 60 can also receive a Superannuation Income Stream by way of an Allocated Pension completely tax free. So that is a lot of ordinary income completely tax free. And double that for a couple!

For persons receiving some Age Pension (generally over age 67) the tax free level can be even greater. 

If I purchased a basket of groceries in the year June 2000 for say $100.00 How much cash would I need today, being 20 years later to buy the same basket of groceries? Answer next week! 

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.

Open Hours

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8:00am to 5:00pm

Closed Public Holidays

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Contact Us

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F: (03) 5831 2988
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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 – 23/11/2020

Market Insights – 19/10/2020

Market Insights

19th October 2020

Top ASX Stocks

CODE

PRICE

CHANGE

 

CODE

PRICE

CHANGE

CSL

$299.00

0.84%

 

ANZ

$19.31

3.82%

CBA

$69.24

2.29%

 

WES

$48.20

3.66%

BHP

$36.25

-0.93%

 

WOW

$39.20

4.09%

WBC

$18.66

3.09%

 

MQG

$134.34

4.14%

NAB

$19.22

2.89%

 

FMG

$16.63

-2.92%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUS DOLLAR IS BUYING

All Ords

6,385.00

-0.46%

 

US Dollar

0.7074

Dow Jones

28,606.31

0.39%

 

Euro

0.6034

FTSE-100

5,919.58

1.49%

 

GB

0.5481

Nikkei 

23,410.63

-0.41%

 

Yen

74.5090

Hang Seng 

24,386.79

0.94%

 

NZD

1.0702

Commodities

Oil (WTI)

40.340

-0.34%

Gold

1,840.000

-0.41%

Iron Ore

121.130

0.26%

Major Market Announcements

– As a technology-driven rally brings U.S. stock indexes within striking distance of fresh records, concerns that big names are over-extended and that new regulation might be coming have some investors diversifying beyond the rally leaders.

– Commonwealth Bank will beef up the size of its in-branch business workforce and implement same-day approvals across all its business lending products as part of its plan to be the country’s number one business bank. Australia’s largest retail lender will double the number of business banking staff within its network of branches, committing a further 180 employees to assist small and medium businesses out of the coronavirus pandemic.

– Australia’s cotton industry is bracing for what could be a devastating blow as it becomes the latest casualty in the escalating trade tensions with China. Mills in China are being told to stop buying Australian cotton as speculation grows that a hefty tariff is about to be slapped on the trade.

– Victorian retailers have expressed a mixture of relief and disappointment over the state government’s easing of restrictions, with many questioning why stores are not able to reopen sooner.

Market Update

Australia’s share market closed lower on Friday after a negative US lead and concern rising coronavirus infections in Europe will lead to lockdowns.

The S&P/ASX200 benchmark closed lower by 33.5 points, or 0.54 per cent, to 6176.8 on Friday.

The week was a good one for investors. The ASX200 finished 1.22 per cent higher.

The All Ordinaries index finished the Friday session lower by 29.2 points, or 0.46 per cent, to 6385.

The Aussie dollar was buying 70.77 US cents at 1622 AEDT, lower from 71.33 US cents at the close of trade on Thursday.

Why Cash is Important in your Overall Asset Allocation

Your Asset Allocation helps you to create diversification within your portfolio, it is how to spread your investments across asset classes, like shares, fixed interest and property. Your Risk Profile helps you to determine your overall Asset Allocation – what you are comfortable to invest into which asset class.

Remaining disciplined and staying on track, regardless of market volatility is one of the most important aspects to investing, and reaching your investment goals.

Cash can be a useful tool to hold, it can be an investors best friend in times of market turmoil, but in this era of low interest rates, how is having cash within a portfolio helpful?

Markets are volatile, they can go up and down, but generally over a 10 year period, you would expect 3 negatives, therefore the other 7 years that your funds remain in cash, as your safe haven, you are missing out.

Use your cash holding as an investment tool, having your funds in cash during a market downturn can “save you” but over a long term period, keeping your funds in cash can do you a disservice based on the longer term returns from the markets.

Think of your cash position as an insurance policy, like insurance policies, it will cost you returns if nothing goes wrong, but if there is a market crash, you can use this cash insurance to buy more of your favorite shares at a lower price.

Your cash levels will increase with dividends, or regular contributions, your growth assets will increase, or decrease with capital gains and losses, so it is always important to review this. Trying to time the market is a tricky game, by keeping say 10% – 20% cash available provides investment opportunity in all market conditions.

We are free to discuss your portfolio, your options with beginning to invest, or any other aspects to your financial planning needs.

Brain Teaser

Last week’s Brain Teaser .. 

How long am I expected to live in retirement if I retired early at age 55 or retired later at age 70? 

ANSWER IS…

– If a male person is currently age 55 years  they are expected to live to age 83.60 years.
– If a male person is currently age 70 years  they are expected to live to age 86.40 years.
– If a female person is currently age 55 years  they are expected to live to age 86.50 years.
– If a female person is currently age 70 years  they are expected to live to age 88.80 years.

So if you completely retire at age 55 you can expect to live 30 years (on average) in retirement essentially living off your retirement savings and a part or full age pension.

If I am over age 60 and retired how much can I earn from all sources before I pay any income tax? Answer next week!

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.

Open Hours

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

Closed Public Holidays

Plus 1 Group logo

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

Contact Us

27 Welsford Street
Shepparton, VIC 3630

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

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