Market Update – January 2022

Highlights:

  • Australia’s S&P/ASX 200 Index rose 2.75% in December with strong returns across Utilities, Materials, Property, and Financials ex Property.

  • Nonfarm payrolls rose 199,000 in December, well below of expectations of a 400,000 increase.

  • European annual inflation rose to 5.2% amid increasing energy costs.

  • The RBA kept the cash rate on hold at 0.1% and will continue its $4-billion-a-week bond-buying stimulus program until at least mid-February.

Global economies

Global Covid-19 cases continue to rise with numbers surpassing 282 million cases and 8.7 billion vaccine doses administered as at the end of December. The global surge in Omicron variant cases caused lockdowns and restrictions in many European countries, even in the wake of widespread booster immunisation programs.

US

The Federal Reserve kept its policy rate unchanged at 0.00-0.25%, as expected and announced at its December meeting it would end its pandemic-era bond purchases in March, paving the way for three interest rate hikes by the end of 2022.

Europe

The European Central Bank made no change to interest rates at its December meeting, holding them at 0.0%.

China

The European Central Bank made no change to interest rates at its December meeting, holding them at 0.0%.

Asia Region

The Bank of Japan left interest rates unchanged at -0.10% during its December meeting.

Australia

The RBA left the cash rate unchanged at 0.1%, as widely expected, and will continue its $4-billion-a-week bond-buying stimulus program until at least mid-February.

 

Read the full January market update report  >>

 

If you have any questions regarding this report or would like to discuss your portfolio, please contact me directly on 0422 287 760.

 

The information in this Market Update is current as at 17/1/2022 and is prepared by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421445 on behalf of IOOF Holdings Ltd and its subsidiaries. Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Before making any decisions based on the content of this document, the reader must consider whether it is personally appropriate in light of his or her financial circumstances or should seek independent financial advice on its appropriateness. Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain and read the corresponding Product Disclosure Statement (PDS) and consider the contents of the PDS before making a decision about whether to acquire the product.