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Global equity markets were mostly higher in local currency. China’s CSI 300 saw a bout of profit taking - not unusual after its 30% year-to-date rally. While the Dow Jones Industrial Average was off 0.06% for the week, the other two major U.S. indexes hit record highs on Tuesday and then again Friday. The S&P 500 rose 1.2% for the week and the Nasdaq Composite gained 1.9% in USD. Drivers? Strong earnings reports and unexpectedly good economic growth. U.S. GDP rose at an annual rate of 3.2% in the first quarter, up from a rate of 2.2% in the fourth quarter and much better than the +1.9% expected. March-quarter earnings have been generally good, particularly from tech companies. Amazon.com ’s profits doubled while Microsoft ’s were strong enough to push its market valuation above $1 trillion (momentarily). A weak Australian dollar provided local investors with a nice windfall over the week.

Weekly returns to 26 April 2019
(AUD 5-day return far right- hand column)

Source: Bloomberg


  • 10-Year Treasury yield: -7bp to 2.49% 
  • Gold: +0.8% to US$1286.16/oz
  • WTI crude oil: -1.2% to US$63.30
  • AUD/USD: -1.6% to US$70.38

Notable company news

A large number of U.S-listed companies reported quarterly earnings last week. A summary for companies we've included in our thematic share portfolios (Vues) can be found here.

The week ahead


We have a huge calendar - one of the biggest we have ever seen. The calendar this week will provide a number of important data points illustrating the state of the American consumer. On Tuesday, personal income and outlays data for March will give some insight into consumer earning and spending - the main drivers of the U.S. economy, and The Conference Board’s consumer confidence index for April will be published Thursday. On Friday, economists expect the April employment report to show a gain of 185,000 jobs in the month, with the unemployment rate holding steady at 3.8%.

Average hourly earnings are estimated to have increased 0.3% in the month, for 3.3% year-over-year growth. The other highlight of the week will be Wednesday’s Federal Open Market Committee monetary policy decision and post-meeting press conference. Fed officials are widely expected to leave interest rates unchanged, at a range of 2.25% to 2.50%.

Source: briefing.com


Japan's markets are closed for the next 10 days and Chinese markets will be closed on Wednesday for five days.

Chart of the week

Remember that “inverted yield curve” and the imminent recession predictions a month or so ago? Well...



Thought of the week

The Future Fund, probably the most successful institutional investor in Australian history, reported it now has grown to a value of $154 billion and has generated a return of 10% per annum over the last decade. Much of that growth has come from its equity holdings as well as skillful asset allocation. Its weighting of global equities to domestic equities is interesting. They now hold 33% of the fund in overseas stocks and just 6.5% in domestic equities. Is there a lesson there?


The LVMH retail “Empire”...


LVMH is the world’s largest luxury goods company and is held in Macrovue’s Luxury Goods thematic portfolio. The stock is up 34% over the year to 26 April 2019.

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