Monthly Highlights:
- Global share markets rebounded strongly in April, with some major markets reaching record highs, as investors looked through ongoing Middle East tensions and focused on a reduced risk of broader escalation. The ceasefire helped stabilise sentiment, though oil prices remained elevated amid ongoing energy supply disruptions. Renewed enthusiasm for AI and stronger-than-expected US corporate earnings also supported the recovery in shares, while bond markets remained cautious amid persistent inflation and interest rate concerns.
- Australian shares delivered positive returns but lagged major global markets. Gains were led by information technology, materials and property, while more defensive sectors such as healthcare and consumer staples underperformed. Energy also declined, reflecting some profit-taking after the prior month’s strong rise. The domestic interest rate backdrop remained a key focus, with the RBA’s consecutive rate rises in February, March and May effectively reversing last year’s rate cuts.
- International shares rose strongly across developed and emerging markets. The US delivered an exceptional rebound, supported by technology and growth companies, while Europe and Japan also posted strong gains. Emerging markets were particularly strong, helped by renewed enthusiasm for companies linked to the AI supply chain, particularly in Korea and Taiwan. For Australian investors, a stronger Australian dollar acted as a headwind to unhedged global share returns.
- Australian and global fixed interest markets stabilised following March’s sell-off and posted modest gains in April. Government bond yields remained elevated as investors focused on inflation and the prospect of tighter policy settings. Credit markets strengthened, with high yield credit outperforming as investor confidence improved.
