It was a remarkable year for share markets in 2017, with major markets across the globe notching returns of around +20% for the year (for the year the US Market was up +19%, NZ Market +22%, AU Market +7%). What was more surprising than the strong returns experienced in 2017, was the way in which they were achieved – with what was close to an absence of volatility.
Despite the fact that markets are at high levels, we remain constructive towards shares in 2018. Our view is that there are “real drivers” behind the market rally, with returns driven by co-ordinated global growth & economic strength, as companies continue to experience earnings momentum. Importantly, low inflation has meant there is still relatively accommodative monetary policy. These factors have created a breeding ground for equity returns....
Stock Markets, Simplified.