BT Financial Monthly Markets Chart: June2010. An overview of movements in global financial markets. Prepared by BT Wrap for the adviser market. Includes review of global share markets as well as Australian share market, dominant currencies, interest rates and both short and long term asset classes.

1. BT Monthly Markets Chart
Pack – June 2010
An overview of movements in global financial markets

2. Weaker than expected economic data added to
European debt woes and kept sentiment negative.
 Global share markets generally fell in June in a
continuation of the decline seen in May. The S&P 500
fell 5.4% and the Nikkei was down 3.95%. In Europe the
DAX managed to close almost flat but other markets fell.
The Hong Kong market managed a small increase of
1.84%.
 The Australian share market posted a decline in June,
with the S&P/ASX 200 Accumulation Index dropping
2.89%. Australian Bonds posted another monthly
increase.
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3. In June global equity markets continued to move
lower
Equity markets: Global, US, Australia – For June rebased to 31 May 2010
106
S&P 500 MSCI World Index S&P/ASX 200
104
102
100
98
96
94
92
90
88
0 0 0 0 0 0 0
5/1 6/1 6/1 6/1 6/1 6/1 6/1
31 /0 5/0 10/0 15/0 20/0 25/0 30/0
Source: BT Financial Group.
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4. The Australian share market closed down 2.59% in
June.
S&P/ASX 200 Index – 1 year to June 2010
5,100
4,900
4,700
4,500
4,300
4,100
3,900
3,700
1/07/09 1/09/09 1/11/09 1/01/10 1/03/10 1/05/10
Source: BT Financial Group, Bloomberg
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5. Key Australian economic news – June
 The Reserve Bank of Australia did not raise interest rates at its monthly meeting in June.
In July it decided to once again hold rates steady but recent inflation data points to the
RBA perhaps having to increase rates at the August meeting. The official cash rate
remains at 4.5%.
 Building approvals slipped 6.6% in May and this was worse than the static rate expected.
 The Manufacturing Index dropped by 3.4 points to 52.9 in June which while still in
expansion mode it does indicate a slowing in the growth rate.
 The ANZ job advertisements index rose 2.7 % in June bringing the annual growth rate to
32.2%.
 The unemployment rate declined to 5.1% in June and May’s reading of 5.2% was revised
downwards to 5.1%.
 Retail sales grew by 0.2% in May which was below expectations of growth of 0.3%.
 Consumer confidence continued to decline with the Westpac/Melbourne Institute’s
consumer sentiment survey showing another sharp drop of 5.7% from May to June. That
decline takes the cumulative decline in the last two months to 12.3% which is the worst two
month result since March 2008.
Source: BT Financial Group
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6. The Australian dollar recovered some lost ground in
June after steep falls in May.
 The Australian dollar gained against the Euro and the US dollar but it continued
to decline in value against the Yen and the British pound.
 The Australian dollar suffered in tandem with global equity markets. The lack of
an RBA interest rate increase in June did not have an overly negative effect on
the value of the Australian dollar.
 At the end of June:
A$1 bought US$0.8447 +0.7%
€0.6896 +0.88%
¥74.74 -2.11%
Source: BT Financial Group
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7. The Australian dollar versus the US dollar…
Currency markets – A$ per US dollar
0.9900
0.9600
0.9300
0.9000
0.8700
0.8400
0.8100
0.7800
0.7500
0.7200
0.6900
0.6600
0.6300
Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10
Source: BT Financial Group. Figures at 30 June 2010
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8. the Euro…
Currency markets – A$ per Euro
0.7150
0.7000
0.6850
0.6700
0.6550
0.6400
0.6250
0.6100
0.5950
0.5800
0.5650
0.5500
0.5350
0.5200
0.5050
0.4900
Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10
Source: BT Financial Group. Figures at 30 June 2010
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9. and the Yen
Currency markets – A$ per Yen
110
105
100
95
90
85
80
75
70
65
60
55
Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10
Source: BT Financial Group. Figures at 30 June 2010
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10. Official world interest rate movements – June
 Interest rates in the major economies remained unchanged in June. The
Reserve Bank of Australia held rates steady at 4.5% at both the June and the
July interest rate meetings.
Direction of
Current rate Last moved last move
Australia 4.50% May 2010
US 0% - 0.25% Dec 2008
Europe (ECB) 1.00% May 2009
Japan 0.14% Dec 2008
United Kingdom 0.50% Mar 2009
Source: BT Financial Group
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11. Global share market returns
As at 30 June 2010
1 year 3 years (pa) 5 years (pa)
Global
S&P 500 Index (US) 12.12% -11.82% -2.85%
Nasdaq (US Tech.) 14.94% -6.77% 0.50%
Nikkei 225 (Japan) -5.78% -19.73% -4.13%
Hang Seng (Hong Kong) 9.52% -2.58% 7.23%
DAX (Germany) 24.06% -9.35% 5.40%
CAC (France) 9.63% -17.15% -4.03%
FTSE 100 (UK) 15.71% -9.38% -0.78%
Australia
S&P/ASX 200 Accum. Ind. 13.15% -7.85% 4.52%
S&P/ASX Small Ordinaries 11.18% -14.20% 2.74%
S&P/ASX 300 Listed Prop. 20.34% -24.31% -8.34%
Source: BT Financial Group
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12. Short-term asset class performance
1-year rolling returns to 30 June 2010 (%) Best performing
asset class for the
year
2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995
Australian
3.89 6.69 6.99 6.21 5.80 5.56 5.11 4.91 4.77 6.36 5.24 5.09 5.41 7.14 7.89 6.21
cash
Australian
7.86 12.77 4.29 3.70 6.74 4.80 4.17 10.09 2.35 11.82 1.79 6.65 15.68 12.56 12.80 2.37
bonds
Australian
20.34 -58.05 -24.16 28.62 18.48 19.97 13.94 13.84 17.38 13.03 2.91 4.26 28.76 19.95 4.71 1.82
property
Australian
shares 13.15 -29.52 -7.04 21.78 30.35 25.63 23.41 -11.93 12.15 3.90 13.18 10.71 18.21 13.55 20.92 -1.89
International
11.51 7.02 8.01 6.38 4.85 6.82 7.66 13.38 5.73 10.83 1.66 8.43 12.55 10.01 14.58 5.55
bonds
International
5.22 -24.48 -14.56 1.47 27.96 8.80 13.74 -33.38 -12.67 -7.05 27.06 18.40 56.60 9.13 12.51 4.56
shares
Source: S&P/ASX 200 Accumulation Index, MSCI World ex-Australia (net dividends) Index in A$, S&P/ASX 300 Property
Index, UBS Composite 0+ years index, Barclays Capital Global Aggregate Bond Index hedged to $A , UBS Bank Bill 0+ years
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13. Short-term asset class performance (cont’d)
1- year return to 30 June 2010 and total 2009 performance (%)
1 January 2010
30 June 2010
12.8
Australian bonds 7.9
-58.1
Listed property 20.3
-29.5
Australian shares
13.2
Global bonds 7.0
11.5
Global shares -24.5
5.2
Source: S&P/ASX 200 Accumulation Index, MSCI World ex-Australia (net dividends) Index in A$, S&P/ASX 300 Property
Index, UBS Composite 0+ years index, Barclays Capital Global Aggregate Bond Index hedged to $A
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14. Long-term asset class performance
30 June 2010
$24,000
$22,500 Australian shares
$21,000
$19,500
$18,000 Listed property
$16,500
Australian bonds
$15,000 Global shares
$13,500
$12,000
$10,500
$9,000
$7,500 Cash
$6,000
$4,500
$3,000
$1,500
$0
84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
Note: Accumulated returns based on $1,000 invested in December 1984
Source: S&P/ASX 300 Accumulation Index, MSCI World ex-Australia (net dividends) Index in A$, S&P/ASX 300 Property Index, UBS Composite 0+
years index, UBS Bank Bill 0+ years
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15. Oil prices recovered slightly in June after a steep fall
in May.
Oil prices – US$ per barrel
$150
$135
$120
$105
$90
$75
$60
$45
$30
$15
$0
95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Source: Bloomberg: Front month WTI futures closing price 30 June 2010
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information only. Every effort has been made to ensure that it is accurate, however it is not intended to be a complete
description of the matters described. The presentation has been prepared without taking into account any personal
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but exclude the entry fee. It is important to note that past performance is not a reliable indicator of future performance.
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