24A Macarthur Street, Parramatta NSW 2150
02 9683 2869

Stay Updated

Insights

Investors focus on vaccines as US and Europe lockdown

Need help? Contact us Macarthur Wealth Management for expert financial advice. https://www.macarthurwealth.com.au

Local and global share prices rose this week on vaccine optimism.  
In local stock news, a fresh class action has been levelled against Crown Resorts, accusing it of misleading investors over possible anti-money laundering breaches. Pressure is piling on the company. 

The Australian banking regulator said it would from January 1 remove its requirement that banks and insurers retain at least half their earnings. That means dividends can start to rise again. In other bank news, the ANZ bank CEO said that 92% of Australian home loan customers allowed deferral had resumed repayments.
 
a2 Milk shares were placed in a trading halt early Thursday morning as the company has become aware of information which may require them to revise their previously issued guidance. Speculation is that it’s another downgrade to earnings. 

The Australian dollar pushed through US76c as the US dollar continued to fall on delays to fresh fiscal stimulus and likely further stimulus from the US central bank. Putting upward pressure on the Aussie is the skyrocketing iron ore price
The Australian Bureau of Statistics showed a further strengthening in employment with more than ¾ of payroll jobs lost earlier in the year regained by the end of November. Employment rose by a very strong 90,000 in November, following revised 180,400 increase in October. The unemployment rate fell to 6.8% even with the participation rate rising to its previous record high. The strength in November largely all came from full time jobs whilst hours worked rose by a strong 2.5%. 

Whilst US labour market data appears to be weakening, a key consumer sentiment survey improved more than expected in November while a gauge of inflation rose moderately. 

European leaders approved a much-needed $2.9 trillion budget and pandemic recovery package which paves the way for the start of European recovery. A large proportion of the funding will find its way to those countries hardest hit economically by Covid, possibly helping to ease north-south European divisions. A big chunk of the money has also been earmarked for climate change initiatives. 

A key Euro area data point pointed to still contractionary conditions in the economy, but the reading came in well ahead of economist expectations, boosted by German manufacturing and French services. The data pushed the EURO to its highest level against the US dollar since 2018. 
PM Scott Morrison won’t be among the world leaders making a virtual address to the United Nations Climate Action Summit. The official line was that the PM wasn’t invited to speak because he hadn’t come up with an ambitious enough pledge to cut greenhouse gas emissions…….bah humbug. Another China bully tactic. Poor form from our allies who allowed it. Worth remembering that Australia is one of the world’s biggest suppliers of LNG, a “transition” energy source that will be in high demand as the world transitions to renewables over a much longer period than current over-ambitious targets. 

China has lifted restrictions on coal from all nations except Australia in the latest attack on our country’s exports. This would provide further grounds for a World Trade Organisation claim. It’s a clear attack from China considering a trade route proximity to them and the quality of our coal on the global stage. Countries like India, Japan, and South Korea will assist in taking some of our coal given increased demand, but they won’t be enough to match Chinese volumes. Apparently, China’s steel producers have called for a regulatory probe into skyrocketing iron ore prices, which sounds rather silly given they are responsible for the rising prices (in addition to lack of supply from Brazil). 

On the vaccine front, vaccines have continued to be rolled out across the UK and the US, with the US expecting to have 40 million doses available by the end of the month. Europe has yet to approve any vaccine. Australia’s supply, whilst high, needs to be re-evaluated following the failed University of Queensland vaccine (was never going to succeed) and higher efficacy for Pfizer and Moderna vaccines over AstraZeneca’s (which we’ve bought the most of). PM Morrison maintains that Australia hopes to distribute vaccines starting in March. Meanwhile deaths in the US continue to rise whilst the Germans have gone into full lockdown (with the Brits and Dutch not far behind) and the South Koreans have warned of potential tighter restrictions. 

The next round of much needed US fiscal stimulus looks no closer to agreement after Senate Majority Leader Mitch McConnell said Republican senators won’t support US$160 billion in state and local funds as part of the potential trade-off. It’s important to note that the US$160 billion is being earmarked for rebuild / repairs in Democrat states and cities that were damaged by violent protests. Republicans want to ensure that all stimulus goes to households and businesses, and that small businesses are protected from any Covid claims. 

A no-trade deal Brexit remains a possible outcome on December 31 after UK PM Boris Johnson’s appeal to European leaders fell on deaf ears. Hardly surprising given the Brits unrealistic expectations that they could divorce themselves from the EU and still retain the benefits that come from being part of the EU. Trade negotiations will continue right up until December 31 in the hope of a deal. 

Joe Biden is now officially the President-Elect of the USA after the state electors submitted enough votes to get him passed the 270 required to become the President in January. Legal challenges remain. The only thing outstanding now is the US Senate, where control will be decided by the Georgia run-off on January 5 where 2 Senate seats are up for grabs. A Republican hold in one or both seats would see the Republicans hold the Senate, whilst a swing of both seats to the Democrats would see the Senate tied at 50-50 which would give the Vice President the tie-breaking vote when required.  

General Advice Warning

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer

All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Financial advice is not the same for everyone

Financial planning. That’s for people with lots of
money to invest, isn’t it?

Not necessarily.

Sure, investment planning is an important part of financial planning, but underpinning the whole process of creating wealth in the first place is having a good financial strategy.

For many people that strategy is taking each day as it comes and letting the future look after itself; but in a complex and ever-changing world, isn’t a more active approach a good idea?

Each of us has specific needs and desires, of course, but there are a number of common challenges that we need to think about when developing our financial strategies.

Stage of life

Baby boomers (born 1946-1964) are moving into retirement in droves so Gen X (1965-1976) is taking on the mantle of being the great wealth accumulators. For the most part, this generation has their strategies
in place: pay down the mortgage, contribute to super, maybe buy an investment property, and wait for the kids to leave home.

Generationally, it’s millennials (1977-1995) who face the greatest challenges in developing a financial strategy. Younger millennials are just embarking on careers and the focus is, understandably, on having a good time.

Many feel priced out of the housing market, and while the ‘gig’ economy promises greater work flexibility, this comes with reduced job security and often no employer superannuation contributions. Then there’s the challenge of balancing starting a family with establishing a career.
All up there’s a lot to plan for.

Gender

The path to income equality is a slow and frustrating one. In general, over their working lives, women continue to earn significantly less than men. This is largely due to time out of the workforce to look after children.
However, progress is being made, and an increasing number of women are earning more than their partners.

Having Dad take time off to look after the kids then becomes a viable financial strategy. On top of that, the gig economy, and technology in general, is opening up more opportunities for stay-at-home parents to earn a decent income.

Relationship breakdown

Sadly, many long-term relationships and marriages end, and the emotional and financial costs can be high. This isn’t an issue that anyone wants to think about, but is obviously a trigger for developing a new financial strategy. This is particularly important when children are involved, and
expert help will likely be needed.

Inheritance

More wealth is being transferred from older to younger generations than ever before, and thanks to superannuation, this trend can only grow.

Receiving an inheritance is often the event that leads many people to seek financial advice. While the focus may be on creating an investment plan, this is an ideal time to look at the broader financial strategy to make the most of any inheritance.

Never too soon to start

The upshot is that pretty much everyone can benefit from having a financial plan. It doesn’t need to be complicated and you can get the ball rolling yourself. A simple savings plan or paying off credit card debt can be good places start. But to make the most of your situation it’s a good idea to talk to a financial adviser.

A qualified adviser can help you understand our complex financial environment and what you need to know to work out the likely outcomes of different strategies.

Ready to take control of your finances? Give us a call and let’s chat. https://www.macarthurwealth.com.au/contact/

General Advice Warning

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer

All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Investors buoyed by more positive vaccine news

Local and global equity markets moved higher this week buoyed by more positive vaccine news as another vaccine showed positive phase 3 results whilst another provider asked for emergency use authorisation. 

In local stock news, the bank regulator wound back its requirement that the Commonwealth Bank carry an extra $1 billion in risk capital by $500 million. The move comes after the regulator was satisfied the bank had made progress in addressing concerns about governance. 

Bega Cheese raised equity this week to fund their acquisition of Lion Diary & Drinks for $534 million, which will see Bega pick up milk, cream, juice, and yoghurt brands such as Dairy Farmers, Pura, and Yoplait. A little over $400 million of the purchase price will be raised via new equity. 

The oil price rose this week as positive vaccine news pointed to potential increase in demand whilst speculation rose that OPEC may look to make further supply reductions. 
Australian retail trade showed a 1.6% lift in October with the Australian Bureau of Statistics reporting a strong 5.2% uplift in trade in Victoria as restrictions began to subside. Retail trade is up 7.3% compared to a year ago. 

178,800 jobs were added in October according to the Australian Bureau of Statistics, versus market expectations of a 40,000 fall in response to the tapering of JobKeeper payments. The latest employment number has reduced the total jobs lost this year from 917,000 to around 195,000. The unemployment rate did rise to 7% due to a sharp increase in people looking for work. A good set of numbers and hopeful momentum can be maintained. However, next year might be a different story as we transition off JobKeeper and JobSeeker entirely. 

According to new Reserve Bank of Australia modelling, overall employment losses would have been twice as large over the 1st half of the year without JobKeeper, but the scheme only saved the jobs of 20% of the individuals it covered which prevented the termination of at least 700,000 additional workers from April to July. Around 650,000 people did become unemployed during that period. 3.5 million individuals were covered by the program at its peak. 

Australian construction work completed in the 3rd quarter fell by 2.6%, against expectations of a 1.9% decline, with residential completions falling by 1% and non-residential falling by 3.4%. Engineering work fell by 3.3% in the same quarter. Residential completions now sit about 18% below the peak in mid-2018. Residential construction was mixed with a 1.1% rise in new homes but a 6.2% fall in apartments, whilst renovation activity was up 5.1% in the quarter. 

The volume of capital expenditure spending in Australia fell by 3% in the 3rd quarter. Mining and non-mining investment both fell. Spending intentions were largely unchanged from three months ago which would imply a 4.9% fall over the year. Mining investment intentions were downgraded whilst non-mining investment intentions were upgraded. Non-mining investment is now down more than 18% over the past year. 

US Treasury and the US central bank went at it this week after the Treasury sent the bank a list of funds to be repaid, that would allow Congress to re-appropriate US$455 billion that was earmarked for central bank support programs. It makes sense they’ve called the money back in given the emergency levels of March/April have passed and the government needs the money, but it removes a fairly sizable tool from the central bank’s toolkit which means less ammunition and lessens their ability to provide comfort to markets. 

Eurozone business activity contracted sharply in November as new virus restrictions across European countries forced many companies in the regions dominant service industry to close temporarily. Manufacturing activity remained a bright spot as many factories have remained open. Data showed that the German economy grew by a record 8.5% in the 3rd quarter.
On the vaccine front, the AstraZeneca / Oxford University vaccine showed positive phase 3 results, providing a 3rd viable vaccine. The vaccine showed less efficacy (70%) than the Pfizer and Moderna vaccines, but interestingly showed very high efficacy when the 1st dose of the vaccine was halved. Importantly, this vaccine can be stored in normal refrigeration, production can be ramped up quicker, and will cost significantly less than the other 2 vaccines. Pfizer has applied to the US FDA for emergency use authorisation of its vaccine. 

Australian coal worth more than $700 million is being held up at Chinese ports because of “apparent” problems with environmental standards. Odd considering we have some of the cleanest coal in the world. Dozens of bulk carriers have been stuck off the Chinese coast for months due to “safety and quality” inspections aimed at Australian exports. 

The NSW-Victorian border opened this week with flights between the states also resuming, whilst Queensland is set to open its border to NSW residents on 1 December. NSW is now the only state open to people from all states and territories. A reduction in federal funding would likely see all other states open their borders. 

A range of pandemic aid programs in the US are set to expire in the new year, leaving millions of Americans without government support. Considering the jobless rate is still very high in the US and some states have been increasing Covid restrictions, a new set of stimulus can’t come fast enough for many Americans, absent a full opening of the economy (ie. no Covid restrictions). 

The US election result remains undecided whilst legal challenges continue. This week we saw additional legal challenges from people and organisations other than team Trump claiming fraud and that election officials didn’t follow the law, whilst at the same time we saw some state election officials confirm the results of their elections. Joe Biden has begun earmarking people for certain roles giving some insights into what a Biden administration may look like. A department of the US government has released funding to support a potential presidential transition.  

Need help?

Contact us Macarthur Wealth Management for expert financial advice. https://www.macarthurwealth.com.au/contact/

We are a Parramatta based financial planning practice, specialising in retirement planning, superannuation and investment advice. Whether you want to start preparing for retirement or have already done so we can help you implement a personalised financial roadmap.

General Advice Warning

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer

All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Vaccine news puts a rocket under Value stocks

Local and most global equity markets rose whilst the US equity market looked likely to finish flat for the week, as the positive vaccine news saw investors rotate into more virus and economically exposed companies.
 
In local news, Macquarie Group reported a 32% fall in half year profit due to $447 million in credit and write-down charges due to the impact of the virus. 

Commonwealth Bank announced that its cash profits for the first quarter have fallen 16% on the same time last year but said that growth in its lending divisions was helping to slowly offset the impacts of Covid-19. 

Wesfarmers reported that Bunnings saw a 25% increase in sales in the four months to October than it did for the same period last year. Officeworks sales were up more than 23%, whilst Kmart was up 3% and Target fell 2%. 

Telstra will undergo is biggest restructure in 24 years, splitting its business into 3 entities. Long overdue. The 3 divisions will include their infrastructure assets, mobile towers, and the retail business. 
The Reserve Bank of Australia has upgraded their Australian economic outlook, with their central scenario seeing the economy contract by 4% this year before expanding by 2% in 2021 and 4% in 2022. The Bank has also lowered their unemployment forecasts whilst maintaining their inflation forecasts. 

New figures show the Australian services industry expanding for the first time since November 2019 as government stimulus and improved confidence leads to an increase in sales, new orders, and deliveries. 

The cost of state border closures and lockdowns is becoming clearer with the South Australian government announcing it will spend big to revive its economy, with $4 billion allocated to protect businesses and jobs and the state also hit by a $1.3 billion cut to GST returns, which will likely result in a state budget deficit of $2.6 billion. Northern Territory’s budget revealed a $2.45 billion deficit, with forecasts it will likely take almost 10 years to balance the books. 

Australian consumer sentiment showed another solid rise of 2.6% in November after a strong lift in October. Confidence around current conditions and expected conditions continued to lift. 

A key Australian business survey indicates an improvement in both confidence and conditions in October. Confidence rose stronger than conditions, with confidence levels the highest since May 2019. Trading and profitability conditions have recovered strongly, but forward orders and export sales remain weak. The results also suggest soft employment growth ahead. 

The European Union negotiators reached a deal on the region’s long-term spending plans, moving a step closer to finalising its landmark 1.8 trillion EURO budget stimulus package. If wrapped up now, it will be operational next which will help with the recovery. 

The European Central Bank President has largely confirmed another big stimulus package at its next meeting in December, with a focus on emergency bond purchases and long-term loans. Rate cuts are highly unlikely, considering the rate is already negative and preference to move it back to 0% over time. 

Chinese President Xi Jinping told the Communist Party’s central committee that China’s economy could double in size by 2035, which implies an average annual growth rate between 4.7-5.0%. This is substantially less than in recent decades, but still an incredible growth rate if achieved. 
Drug company Pfizer announced that their phase 3 Covid-19 vaccine result was positive reporting 90% effectiveness (versus 40-70% for the flu vax), which is significantly higher than expected. However, there’s some uncertainty regarding how long it would maintain effectiveness. Frontline workers will likely get the vaccine before the end of the year, with broader availability from Q1 2021. It’s likely that those very young and very old won’t get the vaccine in the first instance due to safety concerns (i.e. broader safety data required). 

The Australian Government has secured two more vaccines, bringing their investment program to $3.2 billion across 4 vaccines, including Pfizer/BioNTech, Novavax, University of Oxford/AstraZeneca, and University of Queensland/CSL. Hedging bets makes plenty of sense at this stage considering the speed at which these vaccines have been produced and considering their importance in light of suppression being the chosen health policy path. 

Virus cases continued to rise across Europe and the US with a subsequent response of increased restrictions on concerns regarding potential hospital capacity. At the same time, death rates haven’t seen a subsequent rise. Given available therapeutics and earlier learnings, hospital overloading shouldn’t become a problem. Protests against restrictions and containment have also broken out across Europe. 

The US election results remain unconfirmed as counting has yet to be completed in many areas whilst President Trump and his lawyers launch legal challenges in no less than 4 states. The state of Georgia, which has Biden leading by a small margin, will soon start recounting votes by hand. There’s roughly another 3-4 weeks for legal challenges to play out. The state of Georgia will also need to re-vote for their Senators given neither senate seat candidates finished with a 50% majority. Voting closes on the 5th January, so we won’t know the make up of the US Senate until then. It’s likely we end up with Republican controlled Senate which largely means status quo for US domestic policy. At this stage, markets appear favourable to that outcome (i.e. the less change, the better). 

The diplomatic spat between Australia and China appears to have gotten worse this week with a blacklist, apparently delivered verbally to commodities traders, including coal, barley, copper, sugar, timber, wine, and lobster. Iron ore and natural gas have not been targeted as these are essential for China’s recovery efforts. 

Brexit risks are rising as the UK and the EU are still are loggerheads with deadlines looming for a trade agreement and formal exit. Without an agreement, a disorderly exit would ensue. UK PM Johnson had vowed to push ahead with a plan to re-write the agreement which would breach international law. However, the upper house of UK parliament has rejected these plans, putting the onus and pressure back on the PM.  

General Advice Warning
The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer
All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Investors unfazed by uncertain US election result

Local and global equity markets rose this week, with investors seemingly comfortable with undecided US election outcome. 

3rd quarter company earnings season moved past the halfway market, with more than 86% of US companies and 74% of European companies topping estimates

In local stock news, ResMed’s first quarter sales were up 10%, supported by ventilator and mask production for Covid-19. Net operating profit increased 27%. Sleep apnoea machines and new patients remain a little soft given lockdowns. 

Westpac reported a 62% fall in full year cash earnings to $2.6 billion for the 12 months to end of September. The final dividend of 31 cents per share was the maximum allowed by the regulator.

National Australia Bank reported $3.7 billion in cash earnings for the full year, a fall of more than 36% on the same time last year. Large notable items of $1.8 billion hurt, of which $1 billion related to Covid challenges. 

Woolworths food sales jumped almost 13% in the 1st quarter of the financial year, with sales totalling $12 billion, no doubt supported by the Ooshie collectables and lockdown in Victoria. 

The Aussie dollar rose this week against the US dollar, as the US dollar saw weakness stemming from the US election. 
The Reserve Bank of Australia announced significant stimulus at their November meeting including a range of measures. The cash rate was cut to 0.10% whilst the Bank launched their first ever quantitative easing program which will see them buy $100 billion of government bonds over the next 6 months. The Bank also made clear that they won’t be lifting the cash rate for some time. 

Australian credit growth rose slightly in September, to be up by 2% for the year, supported by rising owner-occupier housing credit. Both personal and business credit fell in the month, with personal credit down more than 12% over the year. 

Australia’s manufacturing sector has seen a marked improvement with a key index showing a large increase in October, pushing the sector into expansionary territory. 

Australian dwelling prices rose by 0.2% in October across the 8 capital cities combined, the first increase since April, to be up 3.7% over the year. Melbourne lagged, and has now fallen 5.6% since March. 

New lending for Australian housing rose by almost 6% in September and is up more than 25% over the year, helped by lower borrowing rates and significant incentives for first home buyers. 

The value of Australian retail trade fell by 1.1% in September, but still remains at an elevated level. Key drivers of the fall were food and household goods. The volume of retail trade bounced by 6.5% in the 3rd quarter following the 3.5% fall in the previous quarter. There was a strong rebound in spending on clothing and eating out in the 3rd quarter. 

The number of building approvals also rose strongly, up more than 15% in September to be 8.8% higher for the year. The gains came from both private houses and private multi-unit approvals. Over the past year, approvals for private houses are now up over 20% while multi-unit approvals remain lower by 12%. Non-residential approvals remain weak, falling more than 36% in September to be 25% lower over the past year. 

Australia’s trade balance recorded a surplus of $5.63 billion in September, with exports rising by 4% whilst imports fell by 6%. Exports will be impacted in the period ahead due to the increase trade tensions with China, whilst imports remain weak as the economic recovery has yet to build any momentum. 

The European Central Bank all but confirmed that are likely to provide additional stimulus at their December meeting considering Europe’s 2nd virus wave has resulted in more lockdowns and damaged the economic recovery. 
The US election is much closer than many expected, particularly the polls, with a result likely some time away considering how much voting was done via post and legal challenges from President Trump and his legal team. Right now, it’s too close to call, but betting agencies and political pundits have a likely Biden presidential victory with the Republicans holding control of the Senate. This would mean no US tax increases, no significant changes in legislation, but also no big fiscal stimulus which might entice the US central bank to provide further support. 

The Chinese government went after more Australian exports with timber, barley, and rock lobsters now caught in the crosshairs. The federal agricultural minister confirmed that China has suspended exports of Australian logs from Queensland and barley from another grain producer. 

European countries continue to increase restrictions with Britain, Spain, Austria, France, and Germany at or close to full lockdown. British PM Boris Johnson again under pressure, this time from within his own party, who are largely against lockdown and want to ensure any restrictions are only in place for a short period of time. 

The UK and European Union officials are apparently nearing a solution to break the 8-month deadlock to achieve a trade deal. The deadline for the trade deal remains mid-November. 

The Chinese government pulled the plug on the record $35 billion IPO of Ant Group, the Chinese fintech arm of Alibaba. Ant Group also suspended a Hong Kong IPO until the issue is resolved. It looks like the Chinese government might be punishing Alibaba co-founder Jack Ma for talking out of turn in relation to the country’s financial system.  

General Advice Warning

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer

All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

US ELECTION UPDATE

There’s never a dull moment when it comes to us politics and particularly during a presidential race. Regardless of your political persuasion or whether you think us politics doesn’t affect you, The US remains the world’s superpower and US politics and policy can have a significant impact on investment markets.

Right now, less than 10 days out from the election, it’s important to understand how markets may be impacted or react to the result. Much of the share market rally over the last 3-4 weeks can largely be explained by the market’s acceptance that a Democrat / Biden clean sweep (ie. House, Senate, President), as indicated by the polls and betting odds, would usher in a huge stimulus package, lead to less adversarial foreign policy, and give the elected government sufficient power to “get things done”.

However, the polls and betting odds look eerily like they did leading into the 2016 US election with Clinton leading Trump. The difference this time is that we have Covid-19 and President Trump as the 1st term incumbent. Long term history shows that 1st term Presidents generally get a 2nd term and recent history shows that election polls can be well and truly off. As 2016 showed, President Trump didn’t win the popular vote, but he did win the Electoral College which means key swing states are likely to come into play this time around too.

Putting that aside, this is what we know:

• US equity markets generally go up after a Presidential election.
• Republican policy is generally more Wall Street (ie. share market) friendly.
• President Trump, if re-elected, will continue to operate on the same platform he has for the last 4 years – ie. smaller government, lower taxes, pro-US policies.
• Joe Biden, if elected, will increase taxes, support a very large stimulus package, and support pro-environmental policies.
• Both the Democrats and the Republicans are anti-China, but Democrats support continued globalisation whilst Republicans under Trump prefer less globalisation.
• Republicans prefer a faster re-opening of the US economy whilst Democrats prefer a slower re-opening.
• A President Trump re-election will likely result in both a US equity market and US dollar rise, with a faster short-term recovery in the economy.
• A Biden win could see the US equity market rise (under a huge stimulus package) or fall (under the burden of rising taxes) and likely continued to downward pressure on the US dollar, with a slower short term recovery in the economy.

There are a lot of variables and a lot of unknowns for the market to digest. The following is key to note:

• Markets won’t like a delayed result – ie. the result could take some time to obtain given the number of postal votes. In addition, if the result is tight, it’s likely either side will request a recount.
• Markets won’t like a messy result – ie. a result whereby Trump or Biden win with very small majority or no majority in the Senate. Believe it or not, a Democrat House and Senate with Trump retaining the Presidency is actually possible!
• Markets will like a decisive result – ie. a clear election win for either side will see market volatility subside.
• Markets will like a clean result – ie. a Biden or Trump victory with either clean sweep of the House and Senate, or at the very least, a clear majority in the Senate.

The election is 4th November Australia time (3rd November US time). It will make for an interesting week with a Melbourne cup with no spectators and a Reserve Bank of Australia meeting which is likely to see the bank cut the cash rate to 0.1% and launch a large bond buying program (Quantitative easing).

Equity markets slide as virus cases rise

MARKETS
Local and global equity markets weakened this week as the US failed to pass any new stimulus and rising virus cases in Europe saw significantly increased restrictions. 

In local stock news, Rio Tinto’s September quarter iron ore production improved to be slightly below the same period last year as staff returned to pre-virus work rosters. Production year to date is running slightly ahead of the same time last year. BHP posted a 7.2% rise in iron ore production in the quarter, supported by strong demand from China. 

Westpac Bank said it would sell its 10.7% stake in Zip Co whilst also confirming a court has approved its $1.3 billion fine for breaching anti-money laundering rules. 

The Aussie dollar had a mixed week, falling early in the week on increased likelihood of RBA stimulus at the November meeting, but then rising late in the week on the back of some strong economic data out of China. 

ECONOMIC

Preliminary estimates have Australian retail trade falling by 1.5% in September. Falls were recorded in food, household goods and clothes, whilst spending on department stores and eating out rose. Consumers possibly getting thriftier in light of tapering JobKeeper and JobSeeker payments. In annual terms, retail trade sits 5.2% higher over the year. 

Australian Bureau of Statistics data showed that just under a 1/3rd of businesses reported a fall in monthly revenue in October, compared with nearly half in July, whilst 7% reported a decrease in their number of employees versus 13% three months earlier. 

A key US central bank member made comments that caught some by surprise. He indicated that there is now an open question as to whether there will be an indefinite need for the US central bank to keep buying US bonds (QE) to support market function given how big the US bond market has become, which may be too large for private investors to absorb, thus resulting in higher borrowing costs for the US government. Most people in the know expect this to be the case anyway. Maybe the member’s brazenness caught people by surprise instead. 

US retail sales in September far outstripped expectations and consumer sentiment for October has come in better than expected. However, the lack of new government stimulus may reverse some of these gains. 

Data showed that the number of Americans filing for unemployment benefits last week dropped more than expected to 787,000, but still remains very high, especially in the absence of any new stimulus. 

Key Chinese economic data was released with the economy growing 4.9% in the September quarter from a year earlier, which was lower than expectations for 5.2% rise. Industrial output rose strongly in September, consolidating the strong August numbers. Retail sales grew 3.3% which was significantly better than August numbers. 

POLITICS

Looks likely the Chinese government is now targeting Australia’s cotton industry with China apparently discouraging its spinning mills from using Australian imports. The development follows reports that China has suspended purchases of Australian coal. The last time they restricted Australian coal in February 2019 was due to the Australian Government’s restrictions on Huawei. 

Whilst we saw increased virus restrictions throughout Europe, as the Europeans realised that normal summer vacationing probably wasn’t the best idea, we still haven’t seen a corresponding surge in hospitalisations and/or deaths. As such, any increased restrictions should be measured, targeted, and temporary. Ireland disregarded that, locking down all non-essential businesses for 6 weeks. Interestingly, Sweden is seeing no increase in cases. We saw declining new cases closer to home with NSW & VIC lifting more restrictions whilst NSW is allowing in NZ travellers. The other states need to move towards lifting border restrictions. Pfizer, one of the companies developing a vaccine, announced it could apply for US authorisation for their vaccine in November. 

European Union leaders refused to make any further concessions over post-Brexit trading arrangements with the UK, putting pressure back on UK PM Boris Johnson to honour the terms of the withdrawal agreement signed last year. Not looking good for the UK and their economy. 

Fresh new US fiscal stimulus remains unlikely even though the Treasury Secretary told House Speaker Pelosi that President Trump would lean on his party to sign in a stimulus package if agreed to by Democrats and the Trump administration. Senate Majority Leader McConnell rejected Trump’s assertion, risking Trump’s ire, saying that he could not sell a larger package to his members but that the Senate would vote on a smaller package next week. Tough game. American people need more stimulus, and that stimulus needs to be purposeful not wasteful, all whilst politicians are seeking re-election.  

General Advice Warning

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer

All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Aussie shares rise on expected RBA stimulus

MARKETS

The Australian equity market rose this week as investors continued to digest the Federal Government’s huge budget whilst the RBA Governor seem to indicate that more stimulus will be provided at the November meeting. Declining virus cases in Victoria also supported investor sentiment.

Global equity markets fell this week as concerns arose regarding a broader European lockdown with virus cases escalating, whilst US lawmakers failed to reach agreement on fresh new stimulus.

The Chinese central bank has made changes to currency requirements to stop the Chinese Yuan from rising any further. The measures were previously put in place to stop the decline in the currency, but the recent strong falls in the US dollar have seen the Yuan rise too strongly. All governments and central banks want their currencies lower – a race to the bottom.

The Aussie dollar fell this week as China seemed to restrict the import of Australian coal and the RBA Governor laid the groundwork for a rate cut and more bond buying at their November meeting.

ECONOMIC

A key speech by RBA Governor Lowe seems to have locked in a rate cut at the November meeting, from 0.25% to 0.10%. This will likely extend to the rate the RBA lends money to the banks and the Government’s 3-year bond yield which the RBA is currently fixing at 0.25%. In addition, the speech seems to pave the way for more traditional quantitative easing (QE), where the RBA will be printing money to buy longer dated Government bonds in order to lower their yields. Both measures should also put a cap on any significant Aussie dollar rise from here.

Australian employment fell by 29,500 in September whilst hours worked lifted by 0.5% in the month. Most of the fall in employment came from Victoria with more than 35,000 jobs lost. The unemployment rose to 6.9% whilst the underemployment rate rose to 11.4%.

The value of all housing related lending surged by more than 12% in August, with strong growth across owner occupiers, investors, and first home buyers. Annual growth is almost 20%. Record low interest rates and lack of supply are combining support house prices, outside of Victoria.

Commonwealth Bank said the number of their loans with deferred repayments dropped by 45,000 ($17 billion) by the end of September to 129,000 loans ($42 billion). Better signs, but repayment extensions were also given to 17,300 customers.

Australian consumer sentiment lifted by almost 12% in October to its highest level since July 2018. The lift was somewhat expected given the significant Federal Budget handed down, but came in much higher than expected, with the rise driven by future expectations in response to personal income tax cuts. Confidence in the housing market also strengthened whilst jobs security also improved.

The International Monetary Fund is forecasting global growth to shrink by 4.4% in 2020 (prior forecast of minus 5.2%) before expanding by 5.2% in 2021 (5.4% previously). They expect the Australian economy to contract by 4.2% in 2020 (minus 4.5% previously) with growth of 3% in 2021 (4% previously).

POLICTICS

Australia’s Trade Minister is investigating reports China has suspended the imports of Australian coal. Chinese steel mills and power plants have reportedly been told to stop using Australian coking and thermal coal. The Minister confirmed there has been some disruptions of shipments but no evidence yet of an import ban. PM Morrison and Treasurer Frydenberg are facing increased pressure from export industries and business leaders to soften their stance on China.

US President Trump fuelled hopes for fresh fiscal support telling Congress to “go big” and to get a deal done. Republicans then put forward a larger package which the Democrats turned down. This saw Democrat Speaker Nancy Pelosi come under attack from within her own party and supporter base. US households and businesses desperately need a deal to get done. Politicians playing with people’s lives and livelihoods doesn’t go down well leading into an election. More than 10 million Americans remain out of work. Either they full open the economy or they provide the stimulus.

Virus cases continued to fall in Victoria, but Premier Dan Andrews and CHO Brett Sutton continued to power ahead with Stage 4 restrictions. The problem this time around is that NSW has Stage 2 restrictions with more daily cases. Politicisation of the virus here along with still insufficient contact tracing in Victoria. State borders remain shut, but will hopefully open over the next couple of weeks.

Virus cases continued to increase throughout Europe with leaders potentially reneging on their promises not to lockdown again. France locked down 9 cities whilst the UK was heading towards Tier 3 restrictions. Interestingly, the Mayor of Manchester made it clear they won’t be following any increase to current restrictions, prioritising the livelihoods of their citizens over rising virus cases.

In vaccine news, Johnson & Johnson halted their clinical trial of its vaccine after a participant fell ill. The US FDA has increased safety measures thus extending the timeline for approval. This means we may not get an approval before the US election. Another report cited that the US will have a widely available vaccine by April 2021.

Big Tech came under political pressure this week, drawing the ire of both the Europeans and the Americans. The European Union wants big tech to come under increased regulation to stop them abusing their market power, with new rules to force tech companies to share data with rivals and force them to be more transparent on how they gather information. Across the Atlantic, Twitter and Facebook bordered on interfering in the US election by censoring a New York Post article releasing details of potential Biden family impropriety. Those that shared the article or commented on it saw themselves locked out of Twitter.

British PM Boris Johnson heeded his threat to walk away from negotiations over the future relationship between the UK and the EU on the 15th October, a deadline he had previously set. There remains little sign of an agreement at this stage.

General Advice Warning
The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer
All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Monster budget propels Aussie market higher

MARKETS

Local and global stock markets rose strongly this week, getting a boost from President Trump’s swift recovery from the virus and a potential increase in household stimulus, whilst local stocks got a boost from the Federal Budget.

US Tech stocks came under some pressure as a US Hose committee report laid out damning details of the many anticompetitive practices of the tech giants. The report offered some ideas for controlling them including potential breakups. This action would be more likely in a Democrat / Biden led Senate, even though President Trump has previously threatened to remove some of the special privileges these tech companies have.

In local stock news, Morgan Stanley analysts are expecting the big 4 major banks to record total impairment charges of $2.5 billion in the September quarter. The low number relative to the significant economic contraction can be explained by a combination of JobKeeper, loan repayment holidays, and temporary amendments to insolvency laws. The status of loan repayment deferrals will be key ahead.

The big 4 banks rose strongly this week getting a significant boost from investor sentiment which rose strongly on the back of the Federal Budget. Investors took some comfort that income tax cuts and business incentives will help reduce household and business stress thus shortening or reducing any bad debt cycle ahead. 

CSL said subsidiary Seqirus has finalised a deal with the federal government for a possible virus vaccine from the University of Queensland. However, the timeline on this appears well behind the 6 vaccine candidates globally that are in phase 3 trials now.

Oil prices rose strongly this week after OPEC sent a strong signal that the worst was behind the oil industry and that they expect a strong recovery demand in the 4th quarter.

ECONOMIC

Treasurer Josh Frydenberg handed down the delayed 2020-21 Federal Budget announcing an expected deficit of more than $200 billion and cumulative deficits of almost $500 billion out to 2024-25, in what was the biggest budget since World War II. Significant stimulus in all the right places including income tax cuts to help support consumption and business tax incentives to support business growth and employment, plus manufacturing support and accelerated infrastructure spending. Plenty of assumptions baked into the budget which means more stimulus may be needed.

The RBA kept the cash rate on hold at 0.25% as expected in light of the Federal Budget being handed down on the same day. Expectations are firming that the RBA will announce additional measures at the November meeting including potential small rate cut (unlikely) and further expansion of its balance sheet (i.e. bond buying).

The National Australia Bank monthly business survey showed business conditions rose by a further six points in September. Conditions are now back around the levels seen earlier this year, but remain well below long term averages.

Australian car sales fell sharply in September with demand for new vehicles falling by almost 22% versus the same time last year. To be expected given household employment and income uncertainty ahead.

The Australian trade balance recorded another surplus of $2.6 billion in August, down from $4.7 billion in July and smaller than we’ve seen in recent years. Exports fell 4.2% whilst imports rose 2%. There were large falls in exports of non-monetary (i.e. central bank) gold and exports of services, whilst imports of consumption and intermediate goods rose strongly.

State Street’s global investor confidence index fell in September, with the largest falls coming from Europe and Asia, whilst North America investor confidence rose slightly.

POLITICS

US President Trump recovered swiftly from Covid-19, helped by a range of readily available drug treatments that have been used globally for decades, returning to the White House to continue the election campaign.

US President Trump announced via Twitter that he had called off all negotiations regarding the next US stimulus bill and that any decision will be delayed until after the elections, as both Democrats and Republicans remained too far apart. They actually got pretty close on the dollar value of stimulus, but the Democrat proposal included way too much non-Covid related spending like bailing out the states and repair bills for looting and rioting. He later proposed that he would be willing to sign very specific executive orders to make payments directly to households and provide support to the airline industry.

Prime Minister Scott Morrison announced changes to his front bench following Finance Minister Mathias Cormann’s decision earlier in the year to retire from politics. Simon Birmingham, Minister for Trade, Tourism, and Investment will take on the added responsibilities of Finance Minister and become leader of the Senate, whilst Employment Minister Michaelia Cash will become deputy leader of the Senate. The Prime Minister further announced he will nominate Cormann as its candidate for the secretary general of the OECD.

Australian state borders remain shut and heavily politicised. The Qld premier has vowed to open the border with NSW 1 day after the upcoming Qld election. Victoria remains in stage 4 lockdown whilst reporting less daily cases than NSW. Rumour has it that the WA Premier intends to keep his border shut until April 2021. Australian borders are lines on a map, nothing else. The quicker premiers realise this the quicker the Australian economy can recover.

The 2nd virus wave globally is resulting in increased restrictions across Europe and the US as leaders attempt to bring down daily infection rates. New York will shut schools and businesses in nine neighbourhoods, the French are shutting bars and other restrictions in the Paris region, whilst UK Prime Minister Boris Johnson came under increasing pressure as the country’s test and trace system failed to capture 15,000 positive tests last week. Pleasingly, daily death rates remain largely under control in light of widely used treatments and better testing and tracing. 

General Advice Warning
The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer
All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

FEDERAL BUDGET BRIEFING 2020

Last night the Federal Government handed down its Budget for the 2020–21 financial year.

The Budget’s focus for this year is to regrow the economy by creating job opportunities and encouraging spending.

SOME KEY BUDGET ANNOUNCEMENTS WERE

• Bringing forward the income tax cuts that were scheduled for 2022

• Helping members pay less in super fees and holding super funds accountable for poor performance

• Additional support payments for Age Pension and welfare recipients

• Temporary full expensing to encourage business investment, and tax changes to help businesses offset their tax losses against past profits.

It’s important to remember that the Budget announcements are still only proposals at this stage. Each of the proposals must be passed by Parliament before they are legislated.

TAX

Personal tax cuts Effective 1 July 2020

The Government has announced it will bring forward, by two years, stage two of the previously legislated tax cuts that were due to take effect from 1 July 2022.

As a result, from 1 July 2020:

• The Low-Income Tax Offset (LITO) will increase from $445 to $700. The increased LITO will be reduced at a rate of 5 cents per dollar for taxpayers that have taxable incomes between $37,500 and $45,000. The LITO will then be reduced at a rate of 1.5 cents per dollar for taxpayers that have taxable incomes between $45,000 and $66,667.

• The top threshold of the 19% tax rate will increase from $37,000 to $45,000, and

• The top threshold of the 32.5% tax rate will increase from $90,000 to $120,000.

The Government has also announced that the Low and Middle Income Tax Offset (LMITO), which was due to be removed with the commencement of the stage two tax cuts on 1 July 2022, will be maintained for the 2020 – 2021 yearly only

However, it should be noted that the tax cut of $1,080 for individuals earning between $48,000 and $90,000 will only apply for this year and will cease to be apply from 1 July 2021 due to LMITO being phased out from that date. Other individuals earning below $126,000 will also be impacted (to a lesser extent) by the removal of LMITO from 1 July 2021.

SUPERANNUATION REFORM

Effective 1 July 2021

When a person starts a new job and does not nominate a super fund, employers will be required to contribute to the employee’s existing super account, rather than the employer’s default super fund. Under this measure, the existing super account will be ‘stapled’ to the member so that they keep their current super fund when they change jobs.

The aim of this measure is to improve member outcomes by reducing unintended multiple super accounts that erode member balances through unnecessary fees and insurance premiums. This measure implements Recommendation 3.5 of the Hayne Royal Commission. Employers will be able to obtain the new employee’s existing super fund details from the ATO’s online services. It is important to note that the opportunity to nominate a chosen fund is still available under this reform

Your Super Comparison Tool

Effective 1 July 2021

A new, interactive, online YourSuper comparison tool, to be developed by the ATO, will make it easier for members to choose their super fund.

The online tool will:

• Rank MySuper products by fees and investment returns

• Provide links to super fund websites

• Show the member’s current super accounts and prompt members to consolidate.

The Your Super tool will make it easier for members to compare the fees and performance of super funds in the market creating more competition amongst super funds.

Holding Super Funds to account for underperformance

Effective 1 July 2021

By 1 July 2021, APRA will conduct annual benchmarking tests on the net investment performance of MySuper products.

If a fund is deemed to be underperforming, it will need to inform its members of its underperformance by 1 October 2021. At this time, members must also be provided with information about the YourSuper comparison tool, which will identify any underperforming funds.

Funds that fail two consecutive annual underperformance tests will not be permitted to accept new members until a further annual test shows that they are no longer underperforming. By 1 July 2022, annual performance tests will be extended to other superannuation products.

The reporting of underperforming funds is likely to encourage members to rollover to a super fund with better performance, hence may lead to a consolidation of a number of super funds in the industry.

New responsibilities for Super Fund Trustees

Effective 1 July 2021

The Government will ensure superannuation trustees are more accountable and transparent as to how they manage the retirement savings of members.

By 1 July 2021:

• Superannuation trustees will be required to comply with a new duty to act in the best financial interests of members.

• Trustees must demonstrate that there was a reasonable basis to support their actions that is consistent with members’ best financial interests.

• Trustees must provide members with key information regarding how they manage and spend their money in advance of Annual Members’ Meetings.

This new duty is to act in the best financial interests of the members

SOCIAL SECURITY – ECONOMIC SUPPORT PAYMENT

Effective December 2020 and March 2021

The Government is providing two separate one-off Economic Support Payments of $250 to individuals receiving eligible income support payments or concession cards.

The $250 payments will be paid progressively from December 2020 and March 2021. Eligible individuals must be in receipt of eligible income support payments as at 27 November 2020 and/or 26 February 2021.

• Age Pension (including Age Pension (Blind))

• Carer Allowance*

• Carer Payment

• Commonwealth Seniors Health Card

• Disability Support Pension (including Disability Support Pension (Blind))

• Double Orphan Pension*

• DVA Gold Card

• DVA Payments

• DVA Seniors Card

• Family Tax Benefit (fortnightly recipients) *

• Family Tax Benefit (lump sum recipients) *

• Pensioner Concession Card (PCC) holders (covers non-income and asset test PCC holders and customers who have an extended entitlement to a PCC even though their payment has stopped).

Please note – * If they are not receiving a primary income support payment

Please note that individuals eligible for the Coronavirus Supplement of $250 per fortnight, such as Job Seeker, are not eligible for the one off $250 Economic Support Payment. In addition, if an individual only holds a Low-income Heath Care Card, they do not qualify either for the $250 one off Economic Support Payment.

General Advice Warning

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs. Before making any decision, it is important for you to consider these matters and to seek appropriate legal, tax, and other professional advice.

Disclaimer

All statements made on this website are made in good faith and we believe they are accurate and reliable. Macarthur Wealth Management does not give any warranty as to the accuracy, reliability or completeness of information that is contained in this website, except in so far as any liability under statute cannot be excluded. Macarthur Wealth Management, its directors, employees and their representatives do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided on this website is owned by Macarthur Wealth Management. You may not alter or modify this information in any way, including the removal of this copyright notice.

Scroll to top