International equities were mixed in October. The Chinese market outperformed its peers during the period as its continued success in managing the virus contrasts the growing second and third waves seen elsewhere. Both the Hang Seng (+2.8%) and the CSI 300 (+2.4%) finished higher, dragging the MSCI Emerging Markets index with it (1.4%). Japan (Nikkei 225 -0.9%) and Korea (KOSPI -2.5%) also outperformed their Western counterparts, with both U.S indices down (NASDAQ -2.3%, S&P 500 -2.8%). The United Kingdom (FTSE -4.9%) and Europe (MSCI Europe ex-UK -5.5%) were the worst performers as COVID-19 cases surge to new highs across the continent.

Domestically, the S&P/ASX 200 Accumulation Index was up 1.93% during the period. Information Technology (+9.0%) was the best performing sector during the month as Link Administrative Holdings (LNK +27.9%) was the subject of a private equity bid and Afterpay (APT +21.0%) continued its strong run. Financials (6.3%) also outperformed the broader market, with banks and fund managers benefiting from a targeted value rally, typified by Virgin Money UK (VUK +26.9%) and Pendal (PDL +18.5%) respectively. Industrials (-3.92%) was the worst performing sector with major names such as Aurizon (AZJ -12.6%) and Brambles (BXB -8.8%) struggling to attract investors ahead of key quarterly updates. Utilities (-1.5%) also performed poorly, with energy assets in particular suffering from the uncertainty surrounding the impact of a widespread renewables push. AGL (AGL -8.4%) and Spark Infrastructure (SKI -3.2%) were the key detractors.

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 (November 2020)

16 November 2020