Market Update September 2024
Global Shares
Global share markets demonstrated resilience in September 2024, with the MSCI World Index (NZD hedged) rising 1.5% for the month and an impressive 30.4% over the past year
Emerging markets outperformed developed markets this month, gaining 4.9% in September and 19.5% over 12 months in NZD terms. This strong performance was supported by continued economic growth and expectations of monetary policy easing in major economies. China's equity markets staged a spectacular rally after the government and central bank signaled a strong commitment to rebooting the economy through various monetary and fiscal measures
New Zealand Shares
The New Zealand share market lagged global peers, with the NZX 50 index declining 0.2% in September. However, the market still posted a solid 10.0% gain over the past year
Corporate activity picked up, with several capital raisings and takeover offers impacting the market. The NZ listed property sector struggled, falling 4.4% for the month as higher interest rates continued to weigh on the sector
Fixed Interest
Bond markets delivered positive returns in September as investors anticipated interest rate cuts. New Zealand bonds gained 0.5% for the month and 11.6% over the year, while global bonds (NZD hedged) rose 1.1% in September and 10.2% over 12 months
The strong performance in fixed income markets reflected expectations of easing monetary policy and a soft economic landing. However, concerns about potential inflationary policies under a Trump presidency could lead to rising bond yields in the future.
Outlook
The outlook for markets remains cautiously optimistic, supported by positive economic growth and the prospect of monetary policy easing. The U.S. economy appears far from recession, with Q3 GDP tracking around 3% on an annualized basis. China's recent stimulus measures, while smaller in scale than past efforts, could significantly contribute to GDP growth in 2025 if expanded further.