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International Market Review & Outlook November 2012

It was another white-knuckled month of trading in the global equity markets. A sharp mid-month sell-off followed the Obama re-election, sending markets crashing through long-term supports. These declines were dramatically reversed by the end of November, leaving indices higher but investors' nerves frayed. US markets were again a laggard, with the S&P500 index up 0.3% versus gains of 5.8% in Japan, 2.0% in Germany and 1.1% in the emerging markets.

Click here for full November Report of the Global Economic Overview.
International Market Review & Outlook October 2012

Volatility returned to the equity markets in October, with many indices falling 3-4% from their September/October double-top highs. The VIX volatility index increased 37% from a low of 13.7 to as high as 18.8 before settling slightly lower at 18.6. US markets suffered disproportionately, with the S&P500 losing -2%, as its relative valuation vis-a-vis the rest of the world became over-extended. However, most markets pared their losses by the end of the month, with global market in particular ending higher.

Click here for full October Report of the Global Economic Overview.
Quarterly International Market Review & Outlook September 2012

The global recovery continues, but at a weakening pace. In advanced economies, growth is frustratingly too low to make a substantial dent in unemployment while the growth in major emerging market economies that had earlier carried the world economy has also decreased. Relative to their April 2012 forecast, the IMF forecasts in its October World Economic Outlook now expects 2013 growth of 1.5%, revised down from 2.0%, for advanced economies, and 5.6% down from 6.0% for emerging market and developing economies.

Click here for full Quarterly Report of the Global Economic Overview.
International Market Review & Outlook September 2012

Unprecedented steps by central banks to fix the slowest global growth since 2009 sent investors in "risk-on" mode and rushing into equities. The US Federal Reserve in mid-September pledged a third round of asset purchases, this time aimed at mortgage backed securities, with no timeline for its end. Quickly dubbed "QE Infinity" the Fed will buy an additional $40 billion of securities a month, in addition to Operation Twist, until unemployment is brought down to 'normal' levels.

Click here for full September Report of the Global Economic Overview.
International Market Review & Outlook August 2012

Global stock markets were generally positive in August, although trading volumes remained very light as many decision makers took a summer break. This unexpected rally was not so much the result in an improvement in the macro-economic backdrop which remains decidedly weak: China's Manufacturing Purchasing Managers Index fell to a nine month low while German business confidence fell for the fourth consecutive month. Rather, it appeared to be the result of the mere promise of greater central bank action.

Click here for full August Report of the Global Economic Overview.
International Market Review & Outlook July 2012

In what has now become an all-too-common occurrence, the IMF in July downgraded its outlook for the world economy and called on policy makers for stronger action to combat weaker growth. The Fund has slightly lowered its global growth forecast for 2012 to 3.5%, down 0.1% from its forecast three months ago. It was the IMF's lowest forecast since 2009. However, the new growth projection is based on a trio of big assumptions.  

Click here for full July Report of the Global Economic Overview.
Outlook for Russia promising

Since the collapse of the Soviet Union, Russia has undergone significant changes, moving from a globally-isolated, centrally-planned economy to one that is more market based and globally integrated. As the world’s largest country by landmass, endowed with many of its most prized natural resources, Russia’s future should be promising. However, a variety of factors are at play that may hamper the dynamic growth recently experienced in this core country of the former Soviet empire.

Read Global Country Review — The Russian Federation.
Investors worried about corporate earnings

Investors already fretting about the health of the global economy now face another worry: disappointing corporate earnings. The corporate sector had been the bright spot in the investment landscape, with high profitability, healthy balance sheets and flushed with cash. Now companies are being hit on a number of fronts, including slowing economies in China, Europe and the US, and a strengthening Dollar which reduces profits made from international sales for widely-held US companies.

Click here for more on Global Asset Classes in Pt 2 of the Global Economic Overview.
World economy outlook downgraded

In what has now become an all-too-common occurrence, the IMF in July downgraded its outlook for the world economy and called on policy makers for stronger action to combat weaker growth. The Fund has slightly lowered its global growth forecast for 2012 to 3.5%, down 0.1% from its forecast three months ago. It was the IMF’s lowest forecast since 2009. 

For a closer look at Part 1 of CFAL's Global Economic Overview click here.
Global Bond Fund Review: June 2012

The CFAL Global Bond Fund continued to deliver a solid performance in Q2 2012, ending the quarter with a 2.28 percent return. The fund outperformed its benchmark, Merrill Lynch Global Broad Market Index (7-10yrs) by 128 basis points.Fears of European sovereign default and a weakening global economy drove a flight to safety, and a slight widening of corporate spreads during the quarter. In the face of these uncertainties, we remain disciplined as we continue to seek out attractively priced issues with intermediate term duration.

Read CFAL Global Bond Fund Second Quarter Review
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