Fund Update - March 2021

State Street Global Equity Fund

Global equities rallied in March 2021 (+5.1%), as global bond yields continued to rise. Despite the improved growth outlook, the March Federal Open Market Committee (FOMC) meeting saw the Fed keep its accommodative policy settings in place. Fed chairman Powell stressed again that this year's inflation developments should be viewed as transitory. Improving growth and inflation outlook has continue to support value stocks, which again outperformed during the month. All sectors ended the month in the green; Utilities, Staples and Industrials were key outperformers while IT, Communication Services and Energy lagged.

The State Street Global Equity Fund outperformed the broader index (MSCI World ex Australia TR Index) in March. The outperformance was largely driven by good stock picking within US Technology, US Health Care, US Discretionary and Staples. Utilities was the only sector that had a negative stock selection impact. From a thematic perspective, the fund’s preference for lower risk stocks added value, as the risk-on / re-opening trade lost traction and higher risk names performed poorly. Currency hedging lost 0.4% as the AUD fell 0.7c against the USD – attributable to a pullback in commodity prices and a narrowing spread between Australian and US bond yields.