Message from Coach
On this week’s market summary:
📍1. Australia has exited its first recession in almost three decades, with the economy growing by a better than expected 3.3 per cent in the September quarter, reflecting authorities’ adept handling of the Covid-19 pandemic. A boom in household spending drove the recovery as the easing of social distancing restrictions prompted a 7.9 per cent jump in spending on goods and services in the third quarter. However, the damage wrought by stringent lockdowns was expressed in the annual growth figure, which showed economic activity fell 3.8 per cent in the year to end September.
📍2. UK house prices rose in November at the fastest annual rate in almost six years, despite the lockdown, according to the Nationwide Building Society, as buyers rushed to take advantage of the stamp duty holiday. The average residential property price rose to £230,000 in November, up 6.5 per cent compared with the same month last year — the fastest growth rate since January 2015. On a monthly basis, prices were 0.9 per cent higher than in October, the fifth consecutive monthly expansion, Nationwide said. The annual rate was well above the 5.5 per cent forecast by economists polled by Reuters, who expected a cooling from the 5.8 per cent annual growth in October to reflect the effects of the nationwide lockdown in England and restrictions elsewhere.
📍3. Weaknesses that emerged in the bond market at the height of the pandemic-induced market ructions in March must be “dealt with” and bankers’ pay is due an “adjustment”, Paul Tucker has said. Speaking at the Financial Times Global Banking Summit, Sir Paul — the former Bank of England deputy governor who now chairs the Systemic Risk Council, an advisory body — said the turmoil in the US government bond market this spring showed that trades which rely on heavy levels of borrowing remain a serious issue.
📍4. Vanguard is to close its four European actively managed exchange traded funds because of insufficient demand for the products.The four Ireland-based ETFs have a combined £224m ($298m) in assets under management and provide exposure to four investment factors: value, momentum, low volatility and liquidity. While each of the products is based on an investment factor, they are actively managed by Vanguard’s quantitative equity group, rather than tracking an index. At the time of their launch five years ago Vanguard said the products were “a compelling alternative to high-cost active strategies that target similar exposures”. However, Vanguard said it had written to shareholders to inform them of its intention to close the ETFs in February.
One of the must-ask interview questions for banking and finance is: “Have you read any news recently?”, with the follow-up questions: “How would you link this news to the market and what investment suggestions would you give to your clients based on this news?”
Showing your market sense and ability to provide feasible investment ideas would help to differentiate you from other candidates. Therefore, apart from the weekly news update / investment insights, we have also generated this Weekly Market Summary for you to have a quick understanding of the market development and tips to answer some hot discussion topics.
Take a look of the summary and WhatsApp us in the group if you have questions.