Market commentary
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How much would higher immigration rates help equity markets?
Roger Montgomery
July 5, 2022
In this week’s video insight Roger discusses how the fate of equity markets now hinges materially, but not solely, on the employment picture and the how central banks navigate the very serious choice they have to make between inflation or recession. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary, Video Insights.
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Farewell fiscal 2022, hello fiscal 2023
David Buckland
July 4, 2022
Many commentators point to the six months to June 2022 as being one of the worst June half-year periods for the performance of both the share market and the bond market for several decades. continue…
by David Buckland Posted in Market commentary.
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When bad news is good news
David Buckland
June 28, 2022
After the very sharp sell-off in the share market, the recent rally is indicative of a mood where bad news is good news. Specifically, the recognised slowdown in the English-speaking economies likely means the various Central Banks will not be required to increase official cash rates by the amount that most forecasters had assumed. continue…
by David Buckland Posted in Market commentary.
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What if interest rates don’t go as high as the market is predicting?
Andreas Lundberg
June 27, 2022
With many market watchers expecting the Reserve Bank of Australia (RBA) to keep raising interest rates, high growth companies with no current earnings, but with potential for strong growth, have been heavily sold off. But, due to the economic impact, I’m not so sure the RBA will raise interest rates by as much as predicted. And if I’m correct, investors will be able to pick up (some of) these high growth companies at more favourable prices. continue…
by Andreas Lundberg Posted in Editor's Pick, Market commentary.
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Why it pays to invest when markets are heading south
Roger Montgomery
June 24, 2022
Warren Buffett once observed that “In stocks, it’s the only place where, when things go on sale, people get unhappy.” Which is ironic, because bear markets give long-term investors a wonderful opportunity to make market-beating returns. And the lower the market falls, the more excited we should be about buying shares in quality businesses at knock-down prices. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary.
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Hang onto your hat, as the free money epoch comes to an end
Roger Montgomery
June 23, 2022
The last couple of years have been one helluva ride, haven’t they? Thanks to a heady cocktail of record low interest rates and massive government stimulus, we’ve seen ballooning valuations for companies with no profit – and little or no prospect of making any. But the free money epoch is now ending, and the dire consequences have only just begun for these companies and their shareholders. continue…
by Roger Montgomery Posted in Companies, Editor's Pick, Market commentary.
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What to expect from the stock market?
Roger Montgomery
June 23, 2022
In this week’s video insight Roger discusses what could be next for the stock market. We already know that P/E ratios have compressed considerably, and taken into account all of the increase in bond rates. What they haven’t done, of course, is priced a very significant recession, nor have they priced the possibility of a financial crisis of any description. But what happens if rates stop rising, and if economies don’t go into a recession, and we don’t get a financial crisis? continue…
by Roger Montgomery Posted in Market commentary, Video Insights.
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The size of the hangover usually corresponds with the size of the party!
David Buckland
June 22, 2022
Is this upcoming economic slowdown going to be a minor flesh-wound or a significant recession? At Montgomery Investment Management, we are receiving a lot of inquiry about adding to investments (minor flesh wound) versus a significant recession (the bear market has a long way to run). continue…
by David Buckland Posted in Global markets, Market commentary.
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Would you like P/Es with that?
Roger Montgomery
June 17, 2022
Recently I penned a post proposing the importance of investing in quality companies with solid growth prospects. The suggestion is based simply on rather basic arithmetic; buy and sell shares on the same (now compressed Price to Earnings Ratio) and the investors Internal Rate of Return (IRR) will equal the Earnings Per Share (EPS) growth rate the company achieves. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary.
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Phil Lowe – playing catch up football with his Central Bank counterparts
David Buckland
June 16, 2022
Overnight, the US Federal Reserve tightened their official cash rates by 0.75 per cent, the largest increase since 1994, taking their cash up from 0.75 per cent to 1.5 per cent. Chairman Jerome Powell indicated a minimum increase of 0.5 per cent at the July meeting, meaning a US cash rate of at least 2.0 per cent. continue…
by David Buckland Posted in Market commentary.
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