Bitcoin – it’s not a currency, it’s not a capital asset…so what is it?

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Key points Digital currencies and blockchain technology may have a lot to offer – but that does not mean Bitcoin will be it. Due to extreme volatility, high transaction costs and slow processing, Bitcoin does not cut it as digital cash. But it’s not an asset generating cashflows either, which makes it impossible to value.... Read more continue reading

Global vaccination rate key to market performance

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The pace in which the world is able to vaccinate itself will fundamentally determine the ability of the global economy to return to pre COVID-19 levels, rather than fiscal and monetary policies such as tax changes, according to American Century Investments’ vice president and senior portfolio manager, Brent Puff. Mr Puff said while newly-elected US... Read more continue reading

Biggest lift in Aussie home prices in 17½ years; Record home prices in 53 Aussie regions

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Home prices; Manufacturing activity Home prices: The CoreLogic Home Value Index of national home prices rose by 2.1 per cent in February – the biggest increase since August 2003. Prices were up 4.0 per cent over the year. Capital city home prices lifted 2.0 per cent. Regional home prices were up 2.1 per cent in... Read more continue reading

Weekly market update – week ending 26 February, 2021

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Investment markets and key developments over the past week Global share markets fell over the last week as the selloff in bonds accelerated raising concerns about valuations. Bond yields increased significantly, particularly in the US and Australia and 10 year yields at their highs on Friday were up by around 100 basis points in the... Read more continue reading

Earnings season: On the road back

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Corporate profit reporting season Each ‘earnings season’ or ‘profit-reporting season’ CommSec tracks all the earnings results of S&P/ASX 200 companies to obtain a comprehensive picture of the aggregate health of Corporate Australia. In total, 141 companies of the ASX200 index group reported half-year (interim) results for the 2020/21 year. A further 31 companies with a... Read more continue reading

Will current Fed policy lead to inflation?

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Various key Fed spokespeople, including Chair Powell, Vice Chair Clarida and FOMC member Brainard, have all appeared to downplay nascent concerns that current Fed policy, combined with fiscal stimulus, may lead to the economy overheating and inflation. In so doing Fed speakers appeared keen to emphasise that any talk of withdrawing stimulus is a long way off.... Read more continue reading

Higher Aussie to soften petrol pump pain

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Petrol Prices; Used vehicle market; Household survey Fuel prices: Last week the national average price of unleaded petrol rose by 2.2 cents a litre to 131.2 cents per litre (c/l) according to the Australian Institute of Petroleum. Used car prices: According to the Datium Insights, used vehicle prices fell 2.8 per cent last week. Covid-19... Read more continue reading

Weekly market update – week ending 19 February, 2021

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While Japanese shares rose over the last week, US, European and Chinese shares fell on concerns about the impact of rising bond yields on equity market valuations, particularly for high PE tech stocks.  Australian shares were boosted early in the week to their highest level in nearly a year by strong earnings results, but reversed... Read more continue reading

Structural and cyclical influences driving focus on rising inflation

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The following are some comments from Steve Miller, an adviser at GSFM, on inflation and bond yields. He also looks at the minutes from the Federal Open Market Committee (FOMC) on inflation, and upcoming data on unemployment. 1. Inflation and bond yields The sharp rise in bond yields and attendant yield curve steepening appear to... Read more continue reading

Female underemployment rate hits 7-year low 

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Labour force Employment rose by 29,100 in January (consensus: +30,000) after increasing by 50,000 jobs in December. Full-time jobs rose by 59,000, but part-time jobs fell by 29,800. The unemployment rate fell from 6.6 per cent to 6.4 per cent in January (consensus: 6.5 per cent). Hours worked fell from 1.753 million hours to 1.667... Read more continue reading