Investment Week In Review - 14 November 2016

By Marcus Damen - November 14, 2016

Pitcher Partners Investment Services' wrap up of news and current affairs impacting the markets.

News in Review

  • Donald Trump rode a wave of populist resentment to defeat Hillary Clinton in the race to become the 45th president of the United States. The Republicans also held a majority in the House of Representatives and Senate by a narrow margin.
  • Global equities immediately fell on the surprise result, but developed market equities soon rebounded on hopes that Trump may give the economy the fiscal boost it has been lacking. Emerging markets fell significantly as expectations of higher interest rates in the US saw capital flow back to towards that nation. The Mexican peso fell hard (by nearly 12%) reflecting Trump’s intention to impose a tariff of 35% on Mexico's exports to the US.
  • Business conditions and confidence in Australia softened modestly in October according to the latest NAB Business Survey, though conditions remain at decent levels. Consumer confidence however rebounded sharply despite the uncertainty surrounding the US presidential election and the subdued performance of global stock markets. Consumers' views towards the wider economy were the main driver of the overall rise in confidence.
  • Tourism continues to be a bright spot in Australia's the economic growth outlook with arrivals rising by 2.6% in September, taking the annual growth rate to 11.5%. Tourists from the US have surged by almost 18% in the past year, the fastest pace of growth in records going back 26 years.
  • ANZ Job advertisements rose 1.0% in October after virtually no change in September.
  • Annual growth in job ads rose to 5.2% from 3.8% in the previous month, consistent with the moderate pace of economic growth as well as above average business and consumer sentiment.
  • The UK trade deficit widened to £5.2 billion in September from £3.8 billion in August showing little cushioning from the sharp fall in the pound since the Brexit vote.
  • Germany’s industrial production, traditionally the main growth driver of Europe’s biggest economy, fell at its fastest rate in more than two years amid political uncertainties and increased competition from emerging economies. 
  • China reported a USD $49 billion trade surplus in October compared to a USD $61.3 billion surplus a year earlier. The surplus came wider than last month but lower than what the market had anticipated.
  • China’s consumer inflation rate grew at its fastest pace in six months in October off the back of strong growth in food prices, while producer prices accelerated to a near-five year high. China’s economy expanded at a steady 6.7% in the September quarter and looks set to hit Beijing’s full-year target thanks to stronger government spending, record bank lending and a booming property market.


It will be fascinating to watch the story of President Donald Trump unfold. Such a bold and daring character could well give the system the jolt that it has needed for some time, and this seems to be the view that the market has taken in recent days – cheering the planned fiscal stimulus.

However, such a polarising character also carries great risks from a social and geopolitical perspective, and if he achieves the growth and inflation that he’s hoping to, the Federal Reserve will have a tough job figuring out how to lift interest rates on an increasing debt load. It would not be surprising to see Janet Yellen become the scapegoat for any missteps in the next couple of years. If the economy falters, it will be because she held interest rates too low or raised them too high. If the economy recovers, Trump saved the world. You can see it already.

The Week Ahead

  • Australia: October unemployment rate figures are due
  • US: October Advance Retail Sales, Consumer Price Index (YoY) for October
  • UK & Europe: German Gross Domestic Product for the September quarter, UK Consumer Price Index (YoY) for October
  • China: Retail sales (YoY) for October, industrial production (YoY) for October

Company News

  • Shares in Treasury Wine Estates, which has a significant exposure to the US market, rose more than 8% after the company reiterated its forecasts for an improved financial performance. Chief Executive Michael Clarke told the company's annual general meeting in Adelaide that the company would deliver better than expected savings by fiscal 2020, stronger cash benefits from its acquisition of Diageo Wine, and boost its earnings margin in the high teens by fiscal 2018.
  • BlueScope shares soared after the steel products maker said cost cuts and productivity improvements were bigger than previously flagged, while volumes grew during the first half. BlueScope said it expects to achieve underlying earnings growth of around 50% to $510m in the first half of the financial year despite higher raw material costs.
  • Explosives and fertiliser manufacturer Incitec Pivot chief executive James Fazzino said the outlook for commodity prices is more positive than six months ago but still expects challenging conditions to persist in its key markets in 2017. The company's net profit after tax fell 68% to $128.1 million in the year to September 30, dragged down by a 63% decline in earnings from its fertiliser division and $105.6m impairment on its Gibson Island fertiliser plant in Queensland.
  • Woolworths is threatening to renege on a public commitment made two years ago to buy $70m of locally grown fruit and tomatoes in tins, plastic jars and snack packs from Shepparton cannery SPC Ardmona. SPC today confirmed that Woolworths may walk away from its promise to use Australian-grown tomatoes, apricots, pears and peaches packaged under contract by SPC for its popular private label Select brand.
  • ANZ has replaced its American chief information officer Scott Collary with a former executive from technology services firm Dimension Data Gerard Florian, who will take on a new more senior position reporting to chief executive Shayne Elliott. Starting at the end of January 2017, Mr Florian will take on the newly created role of group executive technology, which is similar to the seniority given to the top technology executive at some of its Big Four banking peers. 

Markets in Review


Capital Return





S&P ASX 200








S&P 500
























ASX200 Sector Performance for the Week

ASX200 Biggest Movers for the Week

$1 Australian buys you:








This material is intended for the use of the clients of Pitcher Partners Investment Services only. It is current at the date of preparation, but may be subject to change. This document does not constitute financial product advice. It is of a general nature and has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on the information you should consider the appropriateness of it having regard to your objectives, financial situation or needs and seek independent advice. You should obtain and consider a Product Disclosure Statement in relation to any financial product before making any decision about acquiring the product. To the maximum extent permitted by law, Pitcher Partners Investment Services Pty Ltd and its representatives will not be liable for any loss or damage incurred by any person directly or indirectly for any use or reliance on this document.

Contact our experts

Other articles


Top of Page

 Back to News


Rob Southwell

Rob Southwell's picture


Managing Partner and Partner – Private Clients Group

> View profile

John Brazzale

John Brazzale's picture


Partner and National Chairman

> View profile

Michael Minter

Michael Minter's picture


Managing Partner

> View profile

Bryan Hughes

Bryan Hughes's picture



> View profile

Tom Verco

Tom Verco's picture


Managing Principal - Private Clients

> View profile

Ross Walker

Ross Walker's picture


> View profile

Partnership fraud


Paperwork and independent advice saves partnerships from fraud

Discover more

Kia Ora Horse Stud


Pitcher Partners fills a Financial Manager gap to keep the business on track

Discover more

Fuel Injection Company Administration


A fuel injection company began life as an Australian public company before being acquired by a UK publicly listed company while in the research and development stage of a “green...

Discover more

@PitcherPartner CPN PERTH | Our Critical Point Network presented our Budget Briefing in Bunbury yesterday, covering Tax, SMSF, Ille…