IFA Awards for Excellence – August 2014

Lonsec Market Commentary – June 2018

Lonsec Market Commentary – June 2018 

The S&P/ASX 200 Accumulation Index rose 3.3% in June, led by the Energy (+7.8%) and IT (+6.3%) sectors. A late rally in oil prices saw oil refiner Caltex (+10.6%) gain, solidified by the announcement of a long-term wholesale food supply agreement with Woolworths (+7.2%).

Australian bonds returned just under 0.5% in June, with Australian corporate debt returning 0.3% and government debt returning just over 0.5%. Long-term government bonds (with a maturity of ten years or more) returned 1.1%.

Australian economic growth is on a firm footing, supported by a bounce in global growth, a rallying commodities sector, and improved business and public sector investment. However, while there has been a surge in employment and hours worked over the past year, momentum has slowed from 2017’s pace, and wages growth remains subdued at around 2.0%.

Lonsec Market Commentary – June 2018

(Lonsec June 2018, Issue Date: 09-07-2018)

Lonsec Market Commentary – May 2018

Lonsec Market Commentary – May 2018 

The S&P/ASX 200 Accumulation Index rose 1.1% in May, with the biggest gains coming from the Health Care (+5.6%) and Consumer Discretionary (+5.1%) sectors. Global developed market shares, measured by the MSCI World Ex Australia Index, returned 0.5% through May in AUD terms, bolstered predominately by gains from the United States and United Kingdom.

Australian bonds returned 0.7% in May, with Australian government bonds returning 0.8% and longer-term government bonds (with a maturity of ten years or more) returning 1.3%.

The Reserve Bank of Australia (RBA) left the cash rate anchored at 1.5% at its June meeting, and judging by the most recent Statement on Monetary Policy, it is unlikely to change course any time soon. Ongoing low wages growth, uncertainty over the extent and impact of the recent tightening in home lending conditions, and inflation barely in the bottom of the RBA’s target range suggest that it would be premature to begin exiting current accommodative policy settings.

Lonsec Market Commentary – May 2018

(Lonsec May 2018, Issue Date: 09-06-2018)

LIFE Quarterly – June 2018

LIFE Quarterly – June 2018

In the Winter Edition of Prepare for LIFE, we use a financial and estate planning perspective to look at how to prepare for you time of passing, as difficult as it may be. There can be steps taken to make sure that your family is not left in a vulnerable position when the day does come.

We also take a look at the Royal Commission and at the intangible value of financial advice. While the industry is going through hard times, it is important not to underestimate the importance pf professional financial advice and how it can transform lives.

What happens to your super after the end of a relationship? Relationship breakdowns have become a reality in this modern world and in this issue we look at the impact it has on your super.

Quarterly Newsletter – June 2018

Lonsec Market Commentary – April 2018

Lonsec Market Commentary – April 2018 

The S&P/ASX 200 Accumulation Index rose 3.8% in April, driven by rises in commodity prices, allowing the index to rebuild following falls through February and March.The MSCI World ex-Australia Index rose 2.8% in Australian dollar terms as global equity markets recovered from the previous month.

In a decision that undoubtedly surprised very few, the RBA left the cash rate on hold at 1.50% at its May meeting, making this the 21st successive month and the longest spell of inactivity since 1990. While there was no discernible shift in rhetoric, the Bank noted that inflation is moving in line with expectations, sitting just below the target 2% rate.

The Australian dollar fell -1.7% against the US dollar in April and -1.2% on a trade-weighted basis, finishing the month at USD 0.75. The relative weakness in the Australian dollar was mostly due to renewed strength from the greenback, which rose late in the month in response to inflation data. The Australian dollar was steady against the British pound and euro, and higher against the Japanese Yen.

Lonsec Market Commentary – April 2018

(Lonsec April 2018, Issue Date: 09-05-2018)

Lonsec Market Commentary – March 2018

Lonsec Market Commentary – March 2018 

The S&P/ASX 200 Accumulation Index fell 3.8% in March, topping off the worst Q1 performance since the GFC despite a mostly positive earnings season in February. Potential inflation is still a concern for investors, and the market is steeling itself for the next rate hike from the RBA, which, when it finally comes, will be the first increase since November 2010.

The MSCI World ex-Australia Index returned -2.3% in both Australian dollar and local currency terms as global equity markets continued to slide through March. While underlying economic data is broadly positive, markets remain concerned about the prospect of inflation as well as the potential for a trade war between the US and China.

The US Fed voted to raise the funds rate in March by 25 basis points to a target range of 1.50–1.75%, but this was not enough to prevent yields from heading down. Australian bonds returned 0.84% over March, with Australian government bonds returning 0.99% and longer-term government bonds (ten years plus) returning 2.60%.

Despite leaving the cash rate on hold at its March meeting, the RBA continues to expect labour markets to tighten globally, and for central banks to get on the front foot by withdrawing stimulus. In its statement, the RBA mentioned the market’s concerns about US trade policy and the contribution it has made to heightened volatility. The expectation is for CPI inflation to be a bit above 2% in 2018, but central banks have already done a great deal of expecting.

Lonsec Market Commentary – March 2018

(Lonsec March 2018, Issue Date: 09-04-2018)

Lonsec Market Commentary – February 2018

Lonsec Market Commentary – February 2018 

The S&P/ASX 200 Accumulation Index rose 0.4% in February, with losses during the start of the month fully regained on a total return basis. The MSCI World ex-Australia Index returned -0.6% in Australian dollar terms and -3.6% in local currency terms as global equity markets were rocked by volatility and a sharp correction early in the month.

Australian bonds returned 0.29% over February, with Australian government bonds returning 0.28% and longer-term government bonds (ten years plus) returning 0.17%. The Australian 10-year yield was flat over February at 2.81%, but jumped to a high of 2.94% early in the month.

The outlook for Australia continues to improve, with unemployment expected to approach 5% over coming years and wages growth to pick up modestly. From a monetary policy perspective, this outlook suggests that while the next move in cash rates is likely to be up, there is little urgency.

The RBA is mindful that wages growth remains low, housing activity appears to be rolling over, and the Australian dollar is still close to 80 US cents, which is probably too high for the Bank’s liking. In its March statement, the RBA had little to say about recent market turmoil, noting only that, “market volatility has increased from the very low levels of last year.”

Lonsec Market Commentary – February 2018

(Lonsec February 2018, Issue Date: 09-03-2018)

LIFE Quarterly – March 2018

LIFE Quarterly – March 2018

In this month’s edition of Prepare for Life, we discuss the risks associated with switching or consolidating super funds. There are benefits to consolidating accounts, but there are important matters that can be overlooked when switching. It can be more complicated than it seems.

Are you thinking of downsizing your home? New legislation was passed in November 2017 that allows you to contribute to your super following the sale of your main residence. We look at how these contributions are treated under taxation and who is eligible.

We cover the benefits and what you should consider if you’re downsizing.

Quarterly Newsletter – March 2018

Lonsec Market Commentary – January 2018

Lonsec Market Commentary – January 2018 

Fixed income markets saw some serious action through January, with yields expanding significantly in response to the market’s reassessment of risk factors and interest rate movements. Australian bonds returned -0.27% over January, with Australian government bonds returning -0.35%, and longer-term government bonds (ten years plus) returning -1.02%.

The RBA’s February monetary policy statement was undeniably more bullish compared to its December release, but nevertheless the board opted to keep the cash rate on hold at 1.50%, with inflation still low but expected to move higher. The Bank’s central forecast for GDP growth is just above 3% over the next two years, supported by monetary policy conditions that remain expansionary, while the benefits of broad-based global growth and increased international trade are flowing through to the local economy.

The S&P/ASX 200 Accumulation Index fell 0.5% in January, pulled down by yield-sensitive utilities and property. The US S&P 500 Index rose 5.6% in US dollar terms, pushing to a new record high of 2690.16 points during the month, before dropping early in February as the market underwent a major correction and volatility spiked.

Lonsec Market Commentary – January 2018

(Lonsec January 2018, Issue Date: 09-02-2018)

Lonsec Market Commentary – December 2017

Lonsec Market Commentary – December 2017 

The S&P/ASX 200 Accumulation Index rose 1.8% in December, with the energy and materials sectors rallying in the final month of 2017. In the US, the S&P 500 fell -1.6% in AUD terms but pushed to record highs through the month in both AUD and USD terms. The Dow Jones Index also rallied through December, breaking through 25,000 points in early January.

While there was no monetary policy meeting of the RBA in January, December’s minutes revealed the board’s continued ambivalence towards domestic conditions. Wages remain stable at a low rate, despite the 3.3% increase in awards and minimum wages in the September quarter.

The RBA has maintained the cash rate at 1.50% for well over a year, and appears content to wait and see how high other central banks go and how quickly. Although the September quarter GDP data showed growth of only
2.8% over the year with consumption spending flat, a range of other releases have provided some grounds for optimism.

Lonsec Market Commentary – December 2017

(Lonsec December 2017, Issue Date: 11-01-2018)

LIFE Quarterly – December 2017

LIFE Quarterly – December 2017

In this month’s edition of Prepare for Life, we look at using super to buy your first home. In its 2017 Federal Budget, the government announced its intention to introduce legislation that would allow first home buyers to access part of their super to purchase a home. The proposal is referred to as the First Home Super Saver (FHSS) scheme.

Contributions that may be withdrawn are limited to a maximum of $15,000 per annum, capped at a total of $30,000 plus associated earnings. This limit is ‘per person’. A couple may, therefore, have access to up to a combined $60,000 plus earnings.Withdrawals under the FHSS scheme cannot be made before 1 July 2018.

Is the FHSS scheme a good thing and are you elligible?

Quarterly Newsletter – December 2017