A Tough January For Global Markets – All Positive From Here

The market has had its worst start to a year since 2008. Local shares have slumped 5% per cent in January, with weakness from China (which has lost a quarter of its value this month) acting as a catalyst for local losses. Australia sells a third of its goods and services to China each year.  Mining shares have lost 9 per cent of their value in January, financials and energy stocks are down 7 per cent.

Whilst overseas 
in Tokyo: the Bank of Japan adopted a negative interest rate policy for the 3rd time since the 1990s, while maintaining its record asset purchase plan.

ANZ investors have been feeling the pain lately, as markets fret over its exposure to slowing Asian economies and the possibility of a dividend cut.

The bank’s shares have plunged by more than a quarter in the past year, a steeper fall than rivals, and some experts predict there could be more volatility as new chief executive Shayne Elliott makes changes to boost longer-term returns.  Yet despite this rocky ride, some analysts say it may offer good returns if you believe Elliott can deliver on his pledge.  

You might not ‘like’ Facebook, the social media phenomenon. But it’s very hard not to be impressed by Facebook, the business, John McDuling notes.More than a billion people use its core service every day, 934 million of them on a mobile device. Those staggering numbers were contained in the gigantic social network’s quarterly earnings report, released to investors in the US this morning. Not only is Facebook – which is apparently about to change one of its key features, the ‘like” button – huge in terms of its user base. It’s also growing like crazy, and (unlike other notable internet growth stocks) making real money.

Facebook made a profit of $US3.7 billion ($5.2 billion) in 2015, up 25 per cent from a year earlier. Revenue grew by 43 per cent to $US17.9 billion.

Its shares soared in after-hours trading in the US. Maybe the so-called FANG trade, which saw investors pile into fast-growing internet stocks (Facebook, Netflix, Amazon and Google/Alphabet) last year, still has some legs after all.