This year has started with a bang, and (thankfully) it wasn’t from the Korean Peninsula. Instead we were treated to Oprah mulling over a potential Presidential race in 2020 as the US (and world) grow increasingly frustrated over Trump’s behaviour.

Most stock markets have added double digit returns over the year. The table shows the S&P500 adding a whopping 21%, closely followed by Japan’s Nikkei at 19%.

International bond markets lost money as yields rose. The US raised short term cash rates from 0.75% at the start of 2017 three times to finish at 1.50% by year’s end. The Fed is expected to continue raising rates in 2018 as US economic health continues to thrive, and Trump’s company tax cuts deliver an additional bolster to the economy. The US Federal Reserve still has around $4 trillion of debt that it bought from the market (to stimulate the economy) on its books, and in October 2017, it began to let this decline. The increased supply of longer term debt (bonds) has seen interest rates rise from 2.37% to 2.55% over the course of the year.

Australian stocks had a mostly flat return for the first 3/4s of the year, and added a hefty 8.3% in the last quarter. As one broker said, it’s a ‘good start, weak middle, strong finish. This is the best quarterly return for the ASX since 2015, and helped lift stocks to +11.8% for the year.