Market Review November2021

Monthly Market Review – November 2021

How the different asset classes have fared (as at 30 November 2021)

1 Bloomberg AusBond Bank 0+Y TR AUD, 2 Bloomberg AusBond Composite 0+Y TR AUD, 3 Bloomberg Barclays Global Aggregate TR Hdg AUD, 4 S&P/ASX All Ordinaries TR, 5 Vanguard International Shares Index, 6 Vanguard Intl Shares Index Hdg AUD TR, 7 Vanguard Emerging Markets Shares Index, 8 FTSE Developed Core Infrastructure 50/50 NR AUD, 9 S&P/ASX 300 AREIT TR, 10 FTSE EPRA/NAREIT Global REITs NR AUD Source: Centrepoint Research Team, Morningstar Direct

International Equities

Hedged and Unhedged International equities exposures varied strongly across the month of November changing 3.65% and -1.56% respectively. After moving sharply higher at the beginning of November, fears regarding higher and longer than expected inflation, news on the new COVID variant, combined with continued tapering talks coming the Federal Reserve was the catalyst in this index retracing the early gains. Higher interest rates in the US, making the USD more relatively attractive, forced the hedged index into negative territory.

Australian Equities

The S&P/ASX All Ordinaries Index fell by 0.33% in November. Fears regarding the Omicron variant spooked markets late in the month as fears of potential complications arising from the unknown variant got priced in. A weakish economic back drop (as highlighted in last month’s update) combined with the unknown impact of this new variant has put Australian markets into caution mode heading into the end of the year.

Domestic and International Fixed Income

Australian 10-year bond yields fell on the quarter as investors bought government bonds to protect from the uncertainty present in the stock market. This meant the Australian bond index rose 2.08%, putting a slight pause in the 3-month trend of rising rates that started with the talks of central bank tapering emanating from the hawkish rhetoric within the United States.

The international bond index rose 0.78% on the month as the same economic factors drove investors to also buy longer-dated international bonds. The new variant will test the global rising rate trend that had begun as a response to higher-than-expected inflation numbers coming from both Europe and the US.

Australian Dollar

The Australian dollar may have finally found a direction as it fell from roughly 0.75 US cents to 0.71 US cents on the month as the United States dollar benefited significantly from interest rate differentials and a safe-haven trade stemming from the outlined uncertainties previously outlined in markets. This appears to be the trend that may follow through December to end the year.

General Advice Warning

This update is issued by Ventura Investment Management Limited (AFSL 253045), which is a related body corporate of Centrepoint Alliance Limited.

The information provided is general advice only and does not take into account your financial circumstances, needs or objectives. Where you are considering the acquisition, or possible acquisition, of a particular financial product, you should obtain a Product Disclosure Statement for the relevant product before you make any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. It is imperative that you seek advice from a registered professional financial adviser before making any investment decisions.

For more information, refer to the Financial Services Guide (FSG) for Ventura Investment Management Limited (available at).

Disclaimer

While Centrepoint Alliance Limited and its related bodies corporate try to ensure that the content of this update is accurate, adequate, and complete, it does not represent or warrant its accuracy, adequacy or completeness. Centrepoint Alliance Limited is not responsible for any loss suffered as a result of or in relation of the use of this update. To the extent permitted by law, Centrepoint Alliance Limited excludes any liability, including negligence, for any loss, including indirect or consequential damages arising from or in relation to the use of this update.