Monthly Market Update
Throughout February, equity markets began to properly reckon with the seriousness of the coronavirus’ impact on the global economy. In New Zealand, the S&P/NZX 50 Index suffered a 3.9% setback, but this outperformed many global peers, some of which fell by more than double this amount.
Reach for Yield & Black Swans: A context for recent volatility
As the advent of coronavirus and an oil price shock set the tone for a turbulent 2020 in markets, it is timely to reflect back on where we are in the investment cycle and how we got here. Whilst much of this won’t be news to many investors, it is intended to provide a piece of background context for understanding current volatility.
Monthly Market Update
The year began strongly for most sharemarkets as the optimism from the last quarter of 2019 carried over into January. This momentum was particularly evident in Asia where IPOs (Initial public offerings) were off to their best start since 2007. By late January however, realisation that China’s coronavirus outbreak had spread to other countries caused investors to abruptly move into risk-off mode, sending sharemarkets lower in the last week of the month.