Australian stocks rose during reporting season, with the S&P/ASX 300 Index up +2.6% in August. Performance was led by Technology, Defensive Staples and Health Care sectors. Mining was the worst performing sector due to a 25% fall in iron ore prices. Given rising vaccination rates and a shift in political rhetoric in favour of living with COVID-19, the market appears to be largely looking through COVID-19 driven downgrades which happened during reporting season.
The State Street Australian Equity Fund underperformed its benchmark during August after fees. From a sector perspective, the underperformance in August was largely driven by our lower than benchmark exposure to IT (not holding Afterpay and Wisetech) and Financials, as well as negative stock selection within Discretionary (Harvey Norman & not holding Dominos). On the other hand, overweight positions within Energy and Staples added a combined 41bps towards relative performance.
Issued by State Street Global Advisors, Australia Services Limited (AFSL Number 274900, ABN 16 108 671 441) (“SSGA, ASL”). Registered office: Level 14, 420 George Street, Sydney, NSW 2000, Australia · Telephone: +612 9240-7600 · Web: www.ssga.com. State Street Global Advisors, Australia, Limited (AFSL Number 238276, ABN 42 003 914 225)
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References to the State Street Australian Equity Fund ("the Fund") in this communication are references to the managed investment schemes domiciled in Australia, promoted by SSGA Australia, in respect of which SSGA, ASL is the Responsible Entity. This general information has been prepared without taking into account your individual objectives, financial situation or needs and you should consider whether it is appropriate for you. You should seek professional advice and consider the product disclosure document and target market determination, available at www.ssga.com, before deciding whether to acquire or continue to hold units in the Funds.
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Source: Bloomberg Finance, L.P., SSGA as at 31 August 2021. Past performance is not a reliable indicator of future performance. This information should not be considered a recommendation to buy or sell any security or sector shown. It is not known whether the securities or sectors shown will be profitable in the future. Characteristics are as of the date indicated, subject to change, and should not be relied upon as current thereafter. Index returns are unmanaged and do not reflect the deduction of any fees or expenses. Index returns reflect all items of income, gain and loss and the reinvestment of dividends and other income.
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