MONTHLY REPORT MERCER COMMENTARY

Transcription

1 MONTHLY REPORT MERCER COMMENTARY April saw share markets bounce back from their recent decline, delivering positive returns across all developed economies such as Australia, UK, the US and others. Market sentiment has improved by generally positive economic and earnings data released over the month. While the potential for a trade war between the US and China transitioned from aggressive tweets into formal negotiations, improving investor confidence of an amicable resolution. Uncertainty remains though, as surveys show US businesses are becoming increasingly concerned about the potential outcomes of the trade negotiations. Any trade war would have a negative impact on investor confidence and potentially on the performance of the Mercer managed investment options. Improving investor confidence in April saw the share markets across the globe perform positively, benefitting members who are invested in shares. Trump and tariffs continued to feature heavily, but the conversation shifted from aggressive social media posts to productive negotiations. While businesses continue to be concerned with the potential outcome of these negotiations, it didn t stop the markets from delivering positive results to investors. All Mercer s investment options returned positive results for investors. Knowing and understanding your risk profile particularly during periods of market volatility is important. Any knee jerk reactions when the markets do fall may impact your longer-term objectives. As a member of the Mercer s schemes you have access to a team of financial advisers who can help you with your investment strategy decisions, which ultimately means, you may save more for your future. Please call to speak with one of the financial advisers on

2 MONTHLY REPORT MONTH IN A SNAPSHOT The New Zealand share market (NZX 50) delivered positive returns in April, up +1.5%. Synlait Milk (+19.2%) was the top performer for the month, while a2 milk (-2%) was one of the few stocks to decline. Australian shares outperformed New Zealand over the month, delivering +3.9%, breathing life into a market that has under-performed most developed markets over the last 12 months. Global share markets enjoyed positive returns in April, up +1.9% in local currency terms. Strong company earnings data, set against a backdrop of solid Chinese economic growth data and rising commodity prices, helped boost returns. The Energy sector was the best performer of the month, while Consumer Staples was the only sector to detract from performance. Expectations of increased inflation (increase in price of goods and services over a period of time) saw investors moving to real assets such as property and infrastructure as a protective measure. This pushed up the returns from Global Listed Property up +2.7% and Global Listed Infrastructure up +2.9%, both ahead of the broader share market. However, both sectors remain well behind global share markets over 12 months.

3 SIGNIFICANT RECENT ITEMS INCLUDE: UK UNITED STATES KOREA KOREA Kim Jong-un and Moon Jae-in, the leaders of North and South Korea respectively, have vowed to negotiate a treaty to formally end the Korean War. UK The UK economic growth rate for Q was +0.1% for the quarter, below expectations, bringing year on year economic growth to +1.2%, much lower than the 2.4% reported by the European Union, reflecting the uncertainty UK businesses face with Brexit on the horizon. US The Trump administration delayed its decision to impose steel and aluminium tariffs on its key trading allies, giving the European Union, Canada and Mexico another 30 days before negotiations will be finalised.

4 INVESTMENT RETURNS MERCER KIWISAVER SCHEME 28% PRESCRIBED Cash 0.12% 1.47% 1.98% Conservative 0.43% 3.54% 4.57% Moderate 0.68% 4.52% na Balanced 1.12% 6.26% 7.22% Growth 1.53% 7.68% na High Growth 1.89% 9.29% 9.99% Shares 2.16% 10.68% na 17.5% PRESCRIBED Cash 0.13% 1.67% 2.31% Conservative 0.41% 3.85% 5.09% Moderate 0.66% 4.89% na Balanced 1.09% 6.71% 7.80% Growth 1.52% 8.19% na High Growth 1.84% 9.82% 10.59% Shares 2.10% 11.13% na 10.5% PRESCRIBED Cash 0.14% 1.81% 2.50% Conservative 0.40% 4.01% 5.39% Moderate 0.65% 5.10% na Balanced 1.06% 6.96% 8.08% Growth 1.46% 8.45% na High Growth 1.81% 10.17% 10.81% Shares 2.07% 11.38% na Notes The investment returns shown on this page are based on the unit price movements of each investment portfolio and are net of tax at the rate indicated and net of fund charges that are charged within the unit prices. Each investor s returns within an investment portfolio will depend on timing of contribution payments and actual fees charged allowing for any fee rebates. The net returns shown are therefore indicative of investment results but may differ from the actual net of fees and tax returns achieved by individual investors. na indicates that investment option was not operating for the full period or did not have funds invested for the full period.

5 INVESTMENT RETURNS MERCER SUPER TRUST 28% PRESCRIBED Cash 0.08% 1.07% 1.65% Conservative 0.39% 3.08% 4.30% Moderate 0.65% 4.24% 5.89% Balanced 1.09% 5.92% 7.18% Growth 1.51% 7.46% 8.56% High Growth 1.87% 9.00% 10.05% Shares 2.14% 10.51% 12.28% 17.5% PRESCRIBED Cash 0.10% 1.23% 1.86% Conservative 0.38% 3.38% 4.72% Moderate 0.63% 4.59% 6.31% Balanced 1.06% 6.31% 7.60% Growth 1.46% 7.92% 9.01% High Growth 1.82% 9.47% 10.37% Shares 2.12% 10.92% 12.63% 10.5% PRESCRIBED Cash 0.11% 1.35% 2.00% Conservative 0.36% 3.52% 4.96% Moderate 0.61% 4.71% 6.50% Balanced 1.01% 6.49% 7.85% Growth 1.46% 8.05% 9.23% High Growth 1.78% 9.74% 10.65% Shares 2.06% 11.29% 12.83% Notes The investment returns shown on this page are based on the unit price movements of each investment portfolio and are net of tax at the rate indicated, net of investment management fees and net of any administration fees that are charged within the unit prices. Administration charges can vary between plans in Mercer Super Trust and portions of such fees may be rebated through the granting of extra units to investors. Each investor s returns within an investment portfolio will depend on timing of contribution payments and actual fees charged allowing for any fee rebates. The net returns shown are therefore indicative of investment results but may differ from the actual net of fees and tax returns achieved by individual investors. na indicates that investment option was not operating for the full period or did not have funds invested for the full period. Fees may be deducted by redeeming units.

6 INVESTMENT RETURNS MERCER FLEXISAVER MERCER-MANAGED INVESTMENT OPTIONS 1 MONTH 1 YEAR 2 YEARS 28% PRESCRIBED Cash 0.09% 1.11% 1.14% Conservative 0.39% 2.91% 3.31% Moderate 0.66% 4.12% 4.69% Balanced 1.09% 5.71% 6.61% Growth 1.52% 7.48% 8.98% High Growth 1.86% 8.78% 10.51% Shares 2.14% 10.33% 12.14% MERCER-MANAGED INVESTMENT OPTIONS 1 MONTH 1 YEAR 2 YEARS 17.5% PRESCRIBED Cash 0.11% 1.49% 1.53% Conservative 0.40% 3.38% 3.60% Moderate 0.63% 4.56% 4.99% Balanced 1.04% 6.36% 7.28% Growth 1.48% 7.87% 9.44% High Growth 1.83% 9.34% 10.86% Shares 2.09% 10.85% 12.60% MERCER-MANAGED INVESTMENT OPTIONS 1 MONTH 1 YEAR 2 YEARS 10.5% PRESCRIBED Cash 0.11% 1.39% 1.42% Conservative 0.37% 3.50% 3.90% Moderate 0.62% 4.75% 5.05% Balanced 1.04% 6.50% 7.48% Growth 1.43% 8.24% 9.76% High Growth 1.78% 9.75% 11.26% Shares 2.04% 11.17% 12.97% Notes The investment returns shown on this page are based on the unit price movements of each investment portfolio and are net of tax at the rate indicated, net of investment management fees and net of any administration fees that are charged within the unit prices. Certain fund charges can vary between investors in Mercer FlexiSaver and portions of such fees may be rebated through the granting of extra units to investors. Each investor s returns within an investment portfolio will depend on timing of contribution payments and actual fees charged allowing for any fee rebates. The net returns shown are therefore indicative of investment results but may differ from the actual net of fees and tax returns achieved by individual investors. na indicates that investment option was not operating for the full period or did not have funds invested for the full period.

7 FINANCIAL MARKETS ONE MONTH ONE YEAR KEY NZ SHARES OVERSEAS SHARES (LOCAL CURRENCY) OVERSEAS SHARES (UNHEDGED) GLOBAL PROPERTY (HEDGED) S&P/NZX 50 (with ICs) MSCI World (Local Currency) MSCI World (Unhedged) FTSE EPRA NAREIT Developed 15.8% GLOBAL INFRASTRUCTURE (HEDGED) FTSE Global Core Infrastructure 50/ % 10.3% NZ FIXED INTEREST S&P/NZX NZ Government Bond NZ CASH OVERSEAS FIXED INTEREST (HEDGED) S&P/NZX 90 Day Bank Bills Bloomberg Global Agg This document has been prepared and published by Mercer (N.Z.) Limited (Mercer). The document has been published as a general information service and does not take account of the investment objectives, financial situation and/or particular needs of any person. Before making any investment decision, you should consider, with or without the assistance of an adviser, whether the information is appropriate in light of your particular investment needs, objectives and financial circumstances. Neither Mercer or any related party accepts any responsibility for any inaccuracy. Past performance is no guarantee or indicator of future performance. Mercer (N.Z.) Limited 1.5% New Zealand Shares 1.9% 3.6% 2.9% Global Property (Hedged) Overseas Shares (Unhedged) Overseas Shares (Local Currency) 2.7% -0.2% New Zealand Fixed Interest Global Infrastructure (Hedged) 0.2% New Zealand Cash -0.4% Overseas Fixed Interest (Hedged) New Zealand Shares 3.3% Global Property (Hedged) Overseas Shares (Unhedged) Overseas Shares (Local Currency) 3.7% 3.5% New Zealand Fixed Interest Global Infrastructure (Hedged) 2.0% 2.1% New Zealand Cash Overseas Fixed Interest (Hedged) B2C - Mercer NZ - Monthly Report - APRIL 2018_v6