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End of year market update June 2020

End of financial year market update June 2020 - Scott Tully, General Manager, Investments

  

  • What happened over the financial year?

     

    Markets started the 2020 financial year on a strong note. But when Coronavirus forced the world into lockdown and rapidly slowed economic activity, investments experienced unprecedented volatility.
    After reaching all-time highs, many markets then delivered deeply negative returns as a result of Coronavirus, more recently however, markets recovered strongly despite poor economic data, a surge in Coronavirus cases and escalating political tensions.

     

    As countries began restarting economic activity, and as governments and central banks continued to support conditions, confidence slowly returned to markets – as reflected in positive returns towards the end of the financial year.

     

    Over the full year, returns for Australian share markets declined by 8% while global shares delivered a small positive return of 1%. Falling interest rates over the year meant fixed interest returned 6% to members.

     

    Outlook? 

     

    If the fluctuations in markets over the last year have reinforced anything, it’s that superannuation does require a longer-term view and that markets do recover.

     

    But when markets are volatile, it’s natural to feel concerned. For members considering making changes to their financial plan, it may help to speak with a financial adviser.

     

    Looking ahead, we anticipate volatility will continue as conditions make a slow but steady recovery. In the meantime, we’re communicating closely with our skilled investment managers to learn more about the risks and opportunities for investing.

     

    As always, we’d like to thank you for your continued support.

Disclaimer

This document has been prepared by Colonial First State Investments Limited ABN 98 002 348 352, AFSL 232468 (CFSIL). The information, opinions, and commentary contained in this document have been sourced from Global Markets Research, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945 (CBA). Global Markets Research has given CFSIL its permission to reproduce its information, opinions, and commentary contained in this document and for CFSIL to authorise third parties to reproduce this document. This document has been prepared for general information purposes only and is intended to provide a summary of the subject matter covered. It does not purport to be comprehensive or to give advice. The views expressed are the views of CFSIL at the time of writing and may change over time. This document does not constitute an offer, invitation, investment recommendation or inducement to acquire, hold, vary, or dispose of any financial products. CFSIL is a wholly owned subsidiary of CBA. CFSIL is the issuer of super, pension and investment products. CBA and its subsidiaries do not guarantee the performance of CFSIL products or the repayment of capital for investments. This document may include general advice but does not take into account your individual objectives, financial situation or needs. The Target Market Determinations (TMD) for our financial products can be found at www.cfs.com.au/tmd and include a description of who a financial product is appropriate for. You should read the relevant Product Disclosure Statement (PDS) and Financial Services Guide (FSG) carefully and assess whether the information is appropriate for you and consider talking to a financial adviser before making an investment decision. The PDS and FSG can be obtained from www.cfs.com.au or by calling us on 13 13 36. Past performance is no indication of future performance. Stocks mentioned are for illustrative purposes only and are not recommendations to you to buy sell or hold these stocks. This document cannot be used or copied in whole or part without CFSIL’s express written consent.