December market update/ 2014

December 19, 2014
December market update - Frontier Advisors

Rob Hogg, Head of our Capital Markets and Asset Allocation Research Team sums up the state of the markets for the month.

Monthly Markets / November 2014

December 11, 2014

Oil prices continued to plunge in November, dipping below USD70/barrel in the days following OPEC’s scheduled meeting when, in a surprising development, the organisation decided to leave its output ceiling unchanged. The price of Brent has now fallen by some 35% since the beginning of the financial year. Equities and bonds generally delivered positive returns in November as expectations of the European Central Bank (ECB) expanding its quantitative easing (QE) policy increased. Strong performance from the non-energy sectors in the US also saw the S&P 500 eke out successive record highs during the month. Energy related equities and High Yield bonds sold off significantly, in line with the falling oil price.

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November market update/ 2014

November 21, 2014
December market update - Frontier Advisors

Rob Hogg, Head of our Capital Markets and Asset Allocation Research Team sums up the state of the markets for the month.

Monthly Markets / October 2014

November 20, 2014

The US Federal Reserve officially ended their quantitative easing program in October while, across the Pacific, the Bank of Japan announced that it was ramping up its own QE program. This follows the ECB in July announcing their asset-backed securities and covered bonds buying program. These announcements clearly highlight the divergence in global monetary policies.

In the US, the economic recovery continues with further improvement in its labour market. In October, the unemployment rate fell from 5.9% to 5.8% although the 214,000 jobs added fell below expectations. US inflation remains subdued at 1.7% y/y in September, providing room for the US Fed to remain dovish and delay raising its policy rate. Other measures of activity also pointed towards solid growth in the US. The manufacturing Purchasing Manager Index (PMI) recorded 55.9 which, despite having fallen from 57.5 from the previous month, is still at a relatively high level.

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October market update/ 2014

October 28, 2014
December market update - Frontier Advisors

Rob Hogg, Head of our Capital Markets and Asset Allocation Research Team sums up the state of the markets for the month.

Monthly Markets / September 2014

October 20, 2014

September seemed to be characterised by a sudden swing in global sentiment in the absence of any single major development. A number of factors were commonly cited. These include geopolitical (Ebola, Russia-Ukraine, ISIS, Hong Kong), fundamental (a lack of breadth in US equity market gains, slowing growth momentum in Europe, Japan and China), and diverging central bank policy paths (US and UK compared with Europe and Japan). Regardless of the causes, growth orientated assets generally sold off (equities, credit and commodities), while volatility picked up from what had been unusually low levels.

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September market update/ 2014

September 17, 2014
December market update - Frontier Advisors

Rob Hogg, Head of our Capital Markets and Asset Allocation Research Team sums up the state of the markets for the month.

Monthly Markets / August 2014

September 16, 2014

The biggest announcement this month came from the European Central Bank (ECB).  Mario Draghi, President of the ECB, announced the lowering of their key interest rate by 0.1% and that the ECB will begin buying asset backed securities and covered bonds to boost liquidity in the private sector.

More details of the purchasing programme will be provided on October 2nd, but the market expects the size of the programme to be between EUR 500 billion to 1 trillion as the ECB aims to expand its balance sheet back to where it was in 2012.  Some of the driving factors behind this surprise (or rather sooner-than-expected) decision have been the risk of deflation with preliminary Euro area inflation rate falling to 0.3% y/y for August and slowing GDP growth rates.  In particular, q/q GDP growth for Germany (Europe’s largest economy) was at -0.2% for Q2, 2014.

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August market update/ 2014

August 18, 2014
December market update - Frontier Advisors

Rob Hogg, Head of our Capital Markets and Asset Allocation Research Team sums up the state of the markets for the month.

Monthly Markets / July 2014

August 15, 2014

US real GDP growth accelerated to an annualised rate of 4.0% in 2Q14, with a higher than expected inventory build-up making a significant contribution. More forward looking indicators suggest Q3 growth should stay robust if the current trend continues. Composite survey data (mix of manufacturing and services sectors) from the ISM and Markit both have activity accelerating to new highs in the current economic expansion. That said, indicators on the health of the labour market were mixed. Non-farm payrolls disappointed, coming in at 209,000. In contrast, initial jobless claims have been steadily decreasing over the past month. Elsewhere, those market participants fearing a near-term rate increase would have welcomed the inflation data over the past month. After rising in recent months, core CPI slowed to 0.1% m/m in July, while hourly wage growth is running at 2.0% y/y.

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