The year in investing

It was an unpredictable year for investors, with geopolitical turmoil, falling commodity prices and a flurry of big IPOs.

They say expect the unexpected -- and 2014 was no exception. Here are some of the things that shocked us and moved markets month by month.

January

Stocks declined as investors confronted the tapering of quantitative easing in the US and ponder what that meant for asset valuations. Ratings agencies cut Qantas to junk status. Telstra sold Sensis for $454 million. Standard & Poor’s cut credit rating on nine eurozone countries, including France. Analysts downgraded Twitter and the stock plunged 17 per cent in a week.

February

G20 finance ministers agreed on a global growth target of two percentage points.Wall Street turbulence continued. Earnings season focused on company downgrades. SPC Ardmona failed to secure a federal government rescue package but the Victorian government stepped in with the funds. Chairman Peter Mason and two directors quit David Jones’ board. Toyota follows Holden in exiting manufacturing in Australia.

March

The Australian dollar convincingly cleared 90 US cents. Tensions between Russia and Ukraine escalated. Myer and David Jones explored a merger. Malaysia Airlines flight MH370 disappears. Shares in Candy Crush maker King Digital dropped 16 per cent on market debut. Gina Rinehart criticised Australians for living beyond their means in an ‘age of entitlement’.

April

David Jones board recommended a $2.2bn takeover bid from South Africa’s Woolworths. Goodman Fielder receives $1.8bn takeover bid.  Australand also became a target, bringing M&A to around $5bn for the month. CBA economists concluded a neutral cash rate is now lower than in the past. H&M opened its first Australian store.  Weibo raised $US285m in US IPO, popped 19 per cent on debut.

May

Financial markets were calm, but in Bondi James Packer and David Gyngell are photographed brawling. The Federal budget outlined a high-income levy. Commonwealth Bank customers are able to withdraw cash from automatic teller machines using their smartphones.  JD.com raised $1.8bn in Nasdaq IPO.

June

The BIS warned central banks on the long-term perils of ultra-low monetary policy. The UK moved to curb some housing loans, following New Zealand and Canada. The ECB unleashed 400 billion euro spending programme and negative interest rates.  Frank Lowy won the vote to restructure Westfield.  Shell sold its $5.3bn Woodside stake. Time magazine declared: “Eat butter.”

July

BHP stuck to its plan to ramp up output despite falling iron ore prices and a supply glut. CBA announces new compensation scheme for financial planning victims.  David Murrays’s interim FSI report was released. Myer manager Andrew Flanagan is charged with fraud after faking his CV and lasting one day in the $400,000-a-year job. Jacqui Lambie began her term representing the Palmer United Party.  Lloyds Banking Group became the seventh institution to agree to fines for the rigging of Libor. Flight MH17 is shot down over Ukraine. The carbon tax is axed.

August

Iron ore and coal prices extend their fall. Gold and oil fail to react to global conflict even as UN estimates more than 6.5 million people had been displaced in Syria and more than 3 million refugees had fled the country.  Telstra announced a $1bn share buyback and the stock hit a 12-year high.

September

$2bn is wiped off the value of Tesco after a profit overstating scandal sends shares sliding.  Scotland voted no to independence. The Australian dollar dropped below 90 US cents.  An iCloud leak resulted in mass celebrity hacking.  Microsoft paid $2.5bn for Minecraft-maker Mojang. Apple’s iPhone 6 launched, with U2’s Songs of Innocence preloaded in the iTunes library.  Alibaba raised $US25bn in its IPO, the biggest on record.

October

The US announces the end of quantitative easing bond-buying programme. Rio Tinto rejected a $183bn takeover offer from Glencore. The ECB stress test produced a “pass.” Gough Whitlam died. RBA’s Guy Debelle warned that a lack of liquidity would make any market sell-off violent.  Turmoil struck US and European markets. Visas are banned for citizens of Ebola-stricken countries. Richard Flanagan’s sixth novel won the Man Booker prize for fiction. Bank of Japan stuns markets with even more stimulus.  Tasmania was the only Australian location to make Lonely Planet’s top 10 destinations for 2015.

November

The Medibank IPO raised $5.68bn. Australian dollar finally declined. A free trade agreement was signed with China.  Ten Network appointed Citi to consider its options in the face of circling suitors. Five banks were fined $US1.7bn by the FCA over foreign exchange rigging. Economists predicted rate cuts in Australia. Japan unexpectedly entered recession. Cricketer Phillip Hughes tragically died. Brisbane hosted the G20 summit.  China cut rates for first time in over two years.

December

 OPEC decided against output cuts, and crude oil dropped below $US60 a barrel. Qantas shares rallied but it was bad news for Russia, Iran, Nigeria and Venezuela, and Australia’s energy producers. Telstra signed a new $11bn NBN agreement. RBA kept rates at a record low for the 16th straight month. Joe Hockey said the budget surplus will be delayed by years. Quarterly GDP came in at a weak 0.3 per cent in Australia on an ‘income recession’. WMO saod 2014 on track to be the hottest year on record. The media dropped all scheduled programming to transmit from Martin Place as a gunman held hostages in the Lindt Chocolate Café.  US stocks hit record highs as US GDP growth is revised up to an annualised 5 per cent for the third quarter, its strongest since 2003. 

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