December 2023 Client Investment Update

from Neil Kendall - Managing Director of Tupicoffs, The Independent Financial Planners

Early in the year we predicted a year of volatility with good returns overall in the markets, and we are happy to inform you that this prediction has now been realised.

The driving forces in the markets this year have been inflation and interest rates. Central banks worldwide have raised interest rates to combat inflation, leading to different reactions in various countries. We are seeing significant impacts on home mortgages in Australia, and minimal impacts in the US due to mortgages often being fixed for 20 or more years. It is expected that these rate rises will result in falling inflation rates.

The S&P 500 has seen a 16% rise in 2023. In contrast, Australian stocks have only risen by 1% for the same period, highlighting the ongoing importance of considering global markets in portfolio management.

We believe that interest rates may have peaked or are nearing their peak, with a potential decrease in 2025. The market direction remains uncertain, but we are positioning our clients’ portfolios for flat or falling interest rate changes.

Tupicoffs would like to express our gratitude for our clients’ trust and support, we are committed to continue providing high quality advice and wish you all a Happy Holiday Season. The team looks forward to working together in 2024.