Snapshot of Investment Markets - for month of June

Key Points:

1. US Inflation and Market Returns:

- Market returns improved due to lower US inflation.

- Concerns about European far-right politics negatively affected markets.

2. Defensive Assets:

- Defensive assets (like bonds) rose by 0.7%.

- Gold prices remained stable.

3. Growth Assets:

- Growth assets (like stocks) increased by 1.4%.

- Global equities went up by 1.8%.

4. Property and Australian Equities:

- Local property sector had a small gain of 0.2%.

- Australian stocks rose by 1.0%.

5. Global Trends:

- Global equity index (MSCI) increased by 2.5%.

- The trend for global stocks has been positive since late 2022.

6. Earnings and Valuations:

- Future earnings expectations slightly decreased.

- The valuation ratio (forward PE) rose to 17.7%.

7. Equity Performance:

- US stocks (S&P 500) had strong growth, up 3.6%.

- European stocks underperformed.

8. Sector Movements:

- Technology and quality stocks performed well.

- Energy and financial stocks saw declines.

- Gold miners dropped significantly.

9. Regional Highlights:

- Japan and US markets showed strong performance.

- Australian stocks had modest gains.

10. Bond Market:

- Australian and global bonds had similar performance.

- Bond yields have been stable since late 2022.

11. Interest Rates:

- Slight increase in interest rate expectations in Australia.

- Corporate bonds performed better than government bonds.

12. Australian Market:

- The S&P/ASX 200 index rose by 1.0%.

- Forward earnings expectations have decreased, impacting market performance.

- Technology and quality trends are influencing the Australian market.

- Resource stocks are held back due to issues in China.

What This Means for You:

- Investment Environment: The market is responding positively to lower US inflation, but political uncertainties in Europe could create some risks.

- Diversification: Holding a mix of defensive assets like bonds and growth assets like stocks could be beneficial.

- Sector Focus: Technology and quality stocks are currently performing well, while energy and financial stocks are struggling.

- Regional Considerations: The US and Japanese markets are showing strong performance, while the Australian market is experiencing moderate gains.

- Interest Rates and Bonds: Bond yields are stable, and there is a slight increase in interest rate expectations in Australia.

By keeping an eye on these trends and diversifying your investments, you can better navigate the current market environment. Alternatively, you could reach out to your financial planner for support and advice.