The Australian share market delivered a return of (-7.3%) for March, its worst result since June 2022. The 3 and 6 month returns are (-2.0%) & (-2.9%), but the 12 month return remains strong at (+11.6%). Only 3 of the top 20 listed companies in Australia delivered a positive return for March – they were Telstra (+2.9%), Woolworths (+1.1%) and Woodside (+23.8%).
Not surprisingly, Energy (+18.5%) was the best sector to be invested in after the Oil price jumped significantly. Real Estate (-11.3%), Information Technology (-12.6%) and Materials (-14.1%) all fell heavily.
The Oil crisis is not only impacting share markets in Australia, but also confidence. ANZ’s consumer confidence index fell to its lowest point since the series began in 1972. Consumer confidence is lower now than it was during Covid.
The world share index fell (-6.2%) with every major share market going backwards. The US market dropped (-5.1%), Japan (-13.2%), China (-7.7%), European equities (-9.8%) and Emerging markets (-13.0%). We already know that April has seen a strong bounce back for share markets, so at this stage the pain has been very short lived.
Highlighting just how common volatility is, research by fund manager Schroders shows that the World Share Index has fallen (-10%) or more 31 out of the last 54 years. In 13 of those years the fall was greater than (-20%). What has changed very recently is the cause of market volatility. Since the start of his second term in January 2025, Donald Trump’s announcements have been the main driver of the US share market’s 5 best days and also its 5 worst days.
National house prices rose (+0.7%) in March. Sydney (-0.1%) and Melbourne (-0.2%) were both negative, but Brisbane (+1.8%), Adelaide (+1.2%) and Perth (+2.5%) continued to deliver strong returns. Perth house prices have outpaced the national average by (+42.2) since December 2019, while Melbourne has underperformed the average by (-26.1%) over the same time.
The unemployment rate remained steady at 4.3%, and the inflation rate was 3.7%. The RBA lifted interest rates to 4.1% in March with further rises predicted. At the same time the US, European Central Bank and Japan all voted to leave rates unchanged. The Australian dollar declined against most key currencies including a (-3.1%) fall against the US dollar.
The Oil price was up (+63.1%) for the month, Iron Ore climbed (+7.6%) and Bitcoin also got into the positives (+4.7%). Gold (-11.6%) and Silver (-19.9%) both went backwards. Lastly, in good news for those who are thinking of getting married, the price of natural diamonds has fallen (-50.4%) since 2022 and is now at the lowest point this century.
