September Market Update 2017

The Pulse

  • Economic data released over the past month has continued to paint a relatively good picture of global growth with most of the major economies experiencing accelerating economic growth in the June quarter.
  • Geopolitical tensions remained heightened in August and this helped drive down bond yields.
  • Political gridlock in the United States increased nervousness about a potential government shutdown.
  • Strong earnings reports from companies in the United States and Europe were largely ignored and global equity markets were essentially flat over the month.
  • Australian GDP growth rebounded in the June quarter after the weather affected softer March quarter.
  • Australia’s earnings reporting season was a touch disappointing with a higher than average number of companies missing earnings projections and many companies lowering their guidance for the year ahead.


Global economies

Reasonably good economic news and earnings reports in the US and Europe were largely ignored by investors, who were more focused on the escalating geopolitical tensions involving North Korea, as well as the impending US debt ceiling and government shutdown negotiations.



Most of the economic data in the United States over the past month has been relatively good. GDP growth in the June quarter was revised up from 2.6% to 3.0% annualised growth helped by stronger household consumption and investment growth.



In the Eurozone, the strong momentum seen earlier this year has continued with economic growth revised up from 2.1% to 2.2% in the June quarter, and business and consumer surveys have remained at strong levels suggesting that the economy is in reasonable shape. Inflation has also ticked up a little, although as in other countries it remains below the European Central Bank’s target rate.



Chinese data over the past month has been a little mixed with some indicators such as the business surveys pointing to better conditions whereas other indicators such as industrial production, retail sales growth and fixed asset investment slowed over the past month.


Asia Region

In Japan, the consumer price index rose an expected 0.4% year-on-year in July, however, the Bank of Japan’s preferred measure of core annual inflation remained very low at just 0.1%. Meanwhile the July employment report in Japan remained strong, with the unemployment rate staying at a very low rate of 2.8%.



In Australia, the June quarter GDP figures painted a picture of an economy in reasonable shape after the weather affected softness in the prior quarter. The 0.8% quarterly expansion in the economy was boosted by strong growth in household consumption, business and government investment and LNG exports.


The information contained in this Market Update is current as at 27/09/2017 and is prepared by GWM Adviser Services Limited ABN 96 002 071749 trading as ThreeSixty Research, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a member of the National group of companies.

Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs. 

Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.

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