Note from the editor - 9 November
Can investors expect the traditional "Santa rally"? US China trade deal already priced in; plus this week's stock tips, including Aussie small-caps, US mid-caps, and a surprising dividend stock to watch.
As the big man in red's annual visit draws closer, this week we've looked at whether investors can expect the traditional "Santa rally". Nicki Bourlioufas quizzed several industry insiders including AMP's Shane Oliver, who considers whether US President Donald Trump will help or harm the investment outlook this festive season.
Even as the US and China inch towards a partial deal on trade, Morningstar’s head of equity research Peter Warnes suggests any good news is already priced-in to markets – but the considerable chance of disappointment leaves plenty of downside risk.
And closer to home, Warnes voiced his view on the Westpac share purchase plan launched this week. While the SPP got a tick of approval from our banks analyst Nathan Zaia, Warnes questions the structure of the arrangement and whether it should have treated retail shareholders more favourably.
Fast-food giant McDonald's made news for the wrong reasons this week, as CEO Steve Easterbrook was fired after breaching company policy by engaging in a consensual relationship with an employee. Morningstar analyst R. J. Hottovy weighs whether the new burger-flipper-in-chief, Chris Kempczinski, is up to the task.
In his weekly column on Firstlinks, editorial director Graham Hand welcomed ASIC’s crackdown on "meaningless warnings, disclosures and disclaimers" in financial services.
Conversely, Fund Spy examines why the watchdog has again failed to force funds to tell investors what's in their portfolios. Australia remains the only market out of 25 regularly surveyed by Morningstar that doesn’t require funds to divulge their portfolio holdings – something investors have every right to be angry about.
And yet, our retirement savings system remains a stand-out among most other nations, as I was reminded while reading a debate between two senior Morningstar colleagues in the US about whether parts of our system should be adopted there.
This week's stock tips include Aussie small-caps, US mid-caps, and a surprising dividend stock to watch. CSR and Flexigroup are among seven over-valued Australian companies, and US brewer Molson Coors is one of nine cheap US mid-caps.
Among dividend stocks, Brian Han turned up the volume on radio broadcaster Southern Cross Media, an old media company defying the trend of industry disruption.
And if you were lucky enough to back Vow And Declare at this year's Melbourne Cup, you'll be surprised at Sarah Newcomb's explanation of what you're most likely to do with unexpected or "found" money – and why easy come doesn't have to mean easy go.