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YEAR TO DATE

Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.

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YEAR TO DATE

Good Morning, Well, it has sometimes felt like the "year of waiting" this year. I'm not a day trader, so I suppose I'm more susceptible to the highs and lows by holding stocks. But the All Ords began the year at 9208 and went through 8686, 9430, 8571 and 9445 to be at 8921 as I write, down about 3%. That to me is very volatile. Is this our market now or do you see things settling down into 2027? Thanks gents.

Answer

Hi David,

2026 has been an extremely volatile year for markets, partly because it’s been a very volatile period from a geopolitical standpoint, plus we’ve got the uncertainties stemming from AI which has been polarising parts of the market. Inflation has driven up rates, earnings growth has been strong, but very narrow, and there is conflict across many parts of the globe – the noise has been very high. Hopefully 2027 will be better, but it will take earnings to hold up and bond markets to settle down for that to happen, and the second part will require a resolution in Iran. In environments like this, we encourage investors to look at the asset allocation within portfolios – if volatility of returns are too high, increasing defensive assets/positioning may be in order over time.

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