Russell Research


Happy Holidays: Fed wraps up 2017 with another rate hike

13/12/2017
The U.S. Federal Reserve (the Fed) delivered another rate hike today, raising its target policy rate by 25 basis points to a new range of 1.25-1.50%.
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The eurozone: Mid-cycle renaissance

4/12/2017
The eurozone is in the middle of a mid-cycle renaissance, both economically and politically. Reflation combined with the refutation of populist movements in the region have laid the foundation for a self-sustaining recovery that could last for years to come. This environment should provide a strong tailwind to eurozone financial markets, which we continue to favor.
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Executive Summary

4/12/2017
Markets have turned optimistic, but it’s late in the cycle and central banks are becoming hawkish. The challenge ahead is to safely navigate between euphoria and danger.
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United States: Too much of a good thing?

4/12/2017
Global growth has lifted the U.S. economy and multinational earnings to their strongest position in years. But with an eight-year-old U.S. expansion, imbalances gradually building, and expensive market valuations, we believe some caution is warranted for U.S. equities. We forecast lackluster U.S. equity market returns in 2018 and view end-of-cycle risks as becoming elevated thereafter.
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Asia Pacific: Low rates, solid growth

4/12/2017
2017 was a strong year for the Asia-Pacific region, underpinned by solid global growth and Chinese demand. We expect the region’s economy to post another year of high growth in 2018, with good support from Australia and Japan, though with developing economies outpacing developed.
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Currencies: Don’t be tempted by yield

4/12/2017
Despite offering higher interest rates than most of their developed-market counterparts, the U.S. dollar (USD) and the New Zealand dollar (NZD) were the two worst performers among Group of Ten (G10) currencies in 2017. We would not bet on a reversal of that trend. The story is different with emerging markets (EM) currencies, which are still appealing despite a tentative recovery this year.
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Russell monthly update

4/12/2017
Here is a summary of investment markets for the month of November 2017
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Turning the tide

29/11/2017
All the major central banks with the exception of the Bank of Japan will reduce their unconventional monetary measures (quantitative easing) in 2018. What impact will the withdrawal of QE have on fixed income markets?
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How much runway is left for the U.S. expansion?

29/11/2017
The U.S. expansion is over eight years old, and the S&P 500® Index is up almost 300 percent, cumulatively, from the bottom in 2009.1 This is the second longest bull market in modern history and the third longest economic expansion in records dating back to the 1800s. History would suggest that now is not the time to be complacent. After all, recessions almost always bring bear markets. And so, after such a strong and long run, it’s important for investors to take a step back and think about where we are in the cycle.
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Superannuation regulation and policy update: Q4 edition

29/11/2017
Our superannuation consultants provide a synopsis of regulatory and government policy changes impacting the super industry.
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Is a recession on the horizon?

22/11/2017
Andrew Pease, Global Head of Investment Strategy, recently presented his three potential market scenarios in our UK Annual Investment Summit this month. Here’s a summary.
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Super changes

20/11/2017
Some important super rules changed on 1 July 2017.
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Russell monthly update

17/11/2017
Here is a summary of investment markets for the month of October 2017
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Multi-asset review Q3 2017

13/11/2017
Andrew Sneddon, Managing Director – Multi-Asset Solutions, discusses Russell Investments’ performance in the September quarter and the outlook for the remainder of 2017.
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The Case for Owning Quality Stocks Now

13/11/2017
Russell Investments believes that a premium for high quality stocks exists, in that they will outperform low quality stocks over the long term. We believe that this anomaly exists as investors tend be focussed on more volatile stocks in the short term with higher upside potential, leading to high quality stocks being mispriced. Furthermore, high quality companies tend to outperform in periods of market stress and downturns, which can have material impact on long term performance.
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U.S. stocks in second longest rally since 1936: where to from here?

8/11/2017
With U.S. stocks seemingly setting new all-time highs every few days, it can be easy to overlook the fact that just nine years ago, markets the world over were roiled by intense market volatility. This memory prompted us to evaluate the status of the current bull market from a historical perspective: How does this rally compare to past U.S. expansions?
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It’s late in the market cycle. Do you know where your portfolio is?

8/11/2017
Note: This is the first blog in a three-part series: Know what you own; Know where you want to go; Know how to get there.
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Bank of England rate hike: One and done

3/11/2017
The Bank of England (BoE) has bitten the bullet and hiked the base rate from 0.25% to 0.5%, but in a dovish turn also provided forward guidance that outlines a very gradual path for future hikes. This was a close call with compelling arguments in favour and against. We are in the against camp and looking ahead we expect the BoE will have to stand down. A one and done rate hike against such a dovish forward guidance background will only briefly impact markets, pushing down gilt yields and the pound and supporting equities.
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A postcard from PRI in Person Berlin

2/11/2017
Nicki Ashton shares her experience at the PRI in Person conference held in Berlin, providing great insight to the latest agenda items for global responsible investing.
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Cash returns no longer set by committee

1/11/2017
In the shadow of accusations of rate rigging by several banks the process by which the interbank lending rate is set in Australia is being overhauled. Importantly these changes, while technical in nature, may have material implications for investors seeking to get the optimal outcomes from their cash investments.
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