09 Dec Review of 2018, outlook for 2019 – another cycle extension
The attached note provides a review of 2018 and what it meant for investors and takes a look at the outlook for 2019.
The key points are as follows:
- 2018 saw reasonable global economic and profit growth and still low interest rates but it has been a rough year for investors with worries about the Fed, trade wars and global growth causing volatility and poor returns.
- 2019 is unlikely to see the plunge into recession many fear with growth likely to stabilise supporting profit growth, the Fed is likely to undertake a pause in rate hikes and global monetary policy is likely to remain easy. The RBA is expected to cut interest rates.
- Against this backdrop, share market volatility will likely remain high but markets should start to improve through the year.
- The main things to keep an eye on are: the risks around the Fed, US/China tensions, global growth, Chinese growth and the property price downturn in Australia.