A "clean sweep" electoral victory for former US President Donald Trump surprised markets, driving a rally in many risk assets from equities to Bitcoin. Late in the month, a US-brokered ceasefire deal was struck between Israel and Hezbollah amid cautious optimism regarding the longevity and terms of the deal. The RBA held rates steady and the US Federal Reserve cut interest rates by a further 0.25%, taking the target range to 4.50% to 4.75%.. Chairman Jerome Powell noted the Fed “does not need to rush to lower interest rates”. Headline US CPI inflation printed 2.6% for October, in line with estimates, and headline Australian CPI printed 2.1%, trailing estimates of 2.3%. Concerns linger however over “core” CPI components which remain stubbornly elevated. US GDP growth printed 2.8% annualised in Q3, aided by strong consumer spending which grew at an annual pace of 3.5%.
The ASX300 Accumulation Index returned 3.7% and A-REITs gained 2.4%. Global share markets jumped 4.9% (with US shares the standout performer - S&P500 +5.9%) and currency-unhedged investors returned 5.2%, aided by a weaker AUD vs peers.
The Australian 2-year government bond yield fell by 0.09% to 3.95% and the Australian 10-year government bond yield declined by 0.16% to 4.34%. The US 2-year government bond yield was little-changed at 4.15% and the US 10-year government bond yield fell by 0.12% to close at 4.17%.
AUTHOR: Allan Grant
Disclaimer: The above is intended as a general market commentary only and is not intended as, and does not constitute, advice of any kind. No liability is accepted for any action based on the above or for any loss suffered as a result of reliance on the same.
