Domestically, the S&P/ASX 200 Accumulation Index was up 8.78% during the period. The month was characterised by a broad-based recovery as investors were prepared to begin looking beyond COVID-19. Energy (+22.0%) was an outperformer over the period as not only did OPEC+ come to an agreement on production cuts, the demand outlook also improved courtesy of the more positive economic sentiment. Information Technology (+22.5%) also outperformed due to companies’ sensitivity to improved growth assumptions and their strength of business models in the face of a pandemic. Consumer Staples (+2.39%) was the worst performer in the period as the money-chasing defensive stocks of March sought better value in April. The defensive nature of Health Care (+4.38%) saw stocks similarly underperform in the April recovery.

Globally, equities were higher as the world began to look past the worst-case COVID-19 scenarios that gripped the markets in April. The US led the recovery (NASDAQ +15.4%, S&P 500 +12.7%) as the last major economy to be hit by the virus began to get on top of the pandemic. By comparison, the European and Asian bourses were not as strong, having seen some of their recovery occur last month (UK FTSE +4.0%, MSCI Europe +5.7%, CSI 300 +6.1%, Nikkei +6.7%, KOSPI +9.0%). Emerging markets were middle of the pack, returning 8.6%.

Disclaimer

This document has been prepared by DNR Capital Pty Ltd, AFS Representative – 294844 of DNR AFSL Pty Ltd ABN 39 118 946 400, AFSL 301658. It is general information only and is not intended to be a recommendation to invest in any product or financial service mentioned above. Whilst DNR Capital has used its best endeavours to ensure the information within this document is accurate it cannot be relied upon in any way and recipients must make their own enquiries concerning the accuracy of the information within. The general information in this document has been prepared without reference to any recipient’s objectives, financial situation or needs. Before making any financial investment decisions we recommend recipients obtain legal and taxation advice appropriate to their particular needs. Investment in a DNR Capital managed account can only be made on completion of all the required documentation.

Source: Motor Trader E-magazine (June 2020)

8 June 2020