Australian Economy – Seasonally-adjusted unemployment figures were favourable, with the rate dropping to 5.4% and the number of employed persons rising by 37001. The lower $A didn't seem to help the trade balance, with exports falling and imports rising, cutting the balance on goods and services for the month of October to just $105 million.
Global Economy – Republicans are working hard to finalise tax cuts in both houses of congress, which is helping to keep markets buoyant. The other major negotiations that took place in November saw Theresa May and her Brexit advisers taking on Ireland and Northern Irish parliamentarians. Without a deal on the Irish border, Brexit talks cannot move on to trade negotiations and if a trade deal isn't finalised by 2019, regulations will default to the less appealing and damaging WTO trade regime.
Investment Markets – Apart from European markets, which were down almost 3%, most other markets finished in positive territory for the month of November. Japan and Hong King led the way, both up over 3%, and the Australian market followed up on an impressive October, finishing up 1% for the month3.
Outlook – Internationally, the focus will remain on US tax reform, with markets now expecting for the transformative tax changes to become law over the next couple of months. This will be a huge milestone for the Trump presidency, who will hope that tax reform will distract from the Russia investigation.
S&P/ASX 200 – 12 months to 30 November 2017
Source: Core Equity Services
Footnotes: 1. Australian Bureau of Statistics; 2. US Dept of Labor; 3. Bloomberg data.