Global markets were up strongly in December, underpinned by a 3.4% surge in the MSCI World Index in the final month of the decade. President Trump’s commitment to a ‘Phase One’ trade deal which includes significant tariff roll-backs, saw emerging markets (EM + 7.2%) markedly outpace developed markets (DM +2.9%) signalling that global trade is back on the agenda for markets. Strong gains in particular were seen in Argentina, Brazil and China; key EM countries.

Domestically, the S&P/ASX 200 Accumulation Index was down 2.2% during December. The best performing sector was Materials (+1.5%) driven by strong commodity prices and limited global iron ore supply. Utilities (+0.8%) was also up, as investors were excited by APA’s (APA) announcement of a new gas transportation agreement. The worst performing sector was Consumer Staples (-8.4%), which was buffeted by the headwind of rising treasury yields following the general market positivity from Brexit and trade war progress. Communication Services (-5.7%) also underperformed, with Telstra Corporation (TLS) continuing to suffer, after an underwhelming investor day late in November.

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This document has been prepared by DNR Capital Pty Ltd, AFS Representative – 294844 of DNR AFSL Pty Ltd ABN 39 118 946 400, AFSL 301658. It is general information only and is not intended to be a recommendation to invest in any product or financial service mentioned above. Whilst DNR Capital has used its best endeavours to ensure the information within this document is accurate it cannot be relied upon in any way and recipients must make their own enquiries concerning the accuracy of the information within. The general information in this document has been prepared without reference to any recipient’s objectives, financial situation or needs. Before making any financial investment decisions we recommend recipients obtain legal and taxation advice appropriate to their particular needs. Investment in a DNR Capital managed account can only be made on completion of all the required documentation.

Source: Motor Trader E-Magazine (Feb 2020)

11 Feb 2020