MONEY MATTERS: Markets mix, cars’ focus and foodstuff

Scott Woods of Bingham-Woods Independent Financial Advisors of Spalding.  Photo by Tim Wilson.  SG090914-142TW.
Scott Woods of Bingham-Woods Independent Financial Advisors of Spalding. Photo by Tim Wilson. SG090914-142TW.
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By Scott Woods of Bingham-Woods Independent Financial Advisors, Spalding.

Global stock markets edged higher, with the MSCI (Morgan Stanley Capital International) All Country World stock market index rising for a second straight week in sterling terms.

This came amid largely better than expected company earnings and solid economic data.

Stocks seen as having bond-like qualities (dividend-paying companies whose share prices are relatively stable) were among the best performers in the index as declining bond yields on many developed-market bonds drove investors to seek out the income offered by company shares.

Meanwhile, Euro area shares underperformed due to growing investor concerns over political risk while, by contrast, Asian stock markets outperformed them and the US dollar bounced, breaking a four-week decline.

On an entirely different note, the world’s top three car makers are under the pump, with Renault-Nissan edging closer to taking its position on the podium.

The Franco-Japanese alliance, boosted by the addition of Mitsubishi Motors last year, sold 9.96 million cars in 2016, falling 4,000 short of overtaking General Motors and snaffling third place in the global car race. However, there’s still clear road between third place and the top two - Volkswagen and Toyota respectively.

Together, the two car giants sold around 600,000 more vehicles in 2016.

In contrast, Renault and Nissan are separate companies but own significant stakes in one another.

Forget the broccoli shortage in Europe, the real crisis dominating the food industry is the affordability of natural vanilla.

Hoarding by local middlemen in Madagascar, the world’s largest producer, has resulted in a three-fold price increase over the past two years to US$450 per kilogramme.

Moves from food giants, Nestlé and Hershey, aiming to phase out synthetic substitutes in favour of the real thing, have also led to price pressures.

That said, around 90 per cent of vanilla flavouring used by global cake and ice cream makers remains synthetic and is derived from petroleum products.

Remember, the value of investments and the income they produce can fall as well as rise so you may get back less than you invested.