Market Update – 31st January 2016

• There was no RBA Monetary Policy meeting in January and the cash rate was kept at 2.00% following the February meeting. 
• In fixed income, the 3 Month Bank Bill Swap Rate and the 10 Year Australian Bond Rate fell by -0.03% and -0.26%, respectively, in January.
• Corporate debt spreads, as measured by the iTraxx Australian Index, rose to 139.54 in January from the previous reading of 126.23.
• Shares fell both domestically and overseas, with the Hong Kong Hang Seng Index declining by -10.18% to be the worst performer.
• In Australia, the All Ordinaries Index and the S&P/ASX 200 Index fell by -5.39% and -5.48%, respectively. Listed property continued to outperform the broader domestic share market, gaining 0.93% for the month.
• Global commodity prices recovered slightly in January, gaining 2.33%, as measured by the US$ CRB Spot Commodity Index. Gold prices had the largest gain, 5.16% in US Dollar terms. Notwithstanding this, over the past year gold has declined by -12.26%.
• Oil and Iron Ore prices continued to suffer, falling by -9.23% and -2.28% over the month, taking the past year loss to -30.31% and -34.15%, respectively. 
• The Australian Dollar depreciated against most currencies in January, falling by -2.82% versus the US Dollar, -2.78% against the Euro and -3.15% versus the Japanese Yen. The Dollar rose slightly comparing to the British Pound, by 0.26% for the month.
• The Australian Trade Weighted Index (TWI) fell by -1.91% over the month, ending January at 61.50.
• The share market volatility rose both domestically (+4.37%) and in the US (+1.99%).

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 Source:       Zenith Investment Partner