Despite the flood of bad news in the quarter, it has turned out rather well for most investors as markets, especially in the US and Europe, rediscovered risk and the joys of cheap money.
Most markets finished the quarter off their lows of last month reached in the wake of the triple disasters in Japan on March 11.
Oil and silver starred for the quarter, copper and sugar were the dunces; most equity markets ended with gains of varying sizes, with the largest among big markets in the US.
Oil hit a new 30 month high overnight, gold a new record close to a day’s trading.
The Australian dollar hit a series of new all time post float highs, including $US1.0364 early Friday morning, before settling back to $US1.0326.
It rose 1.2% in the quarter and 1.7% for the quarter.
Overseas the euro crisis hasn’t gone away (and returned in strength with Portugal close to the brink of a bailout and Ireland needing $US34 billions from its bailout package to help staunch the bleeding from some of its badly run banks).
That takes the total needed to save the bank to a massive $US99 billion.
On top of that has been the surge in oil prices from the outbreak of tension in North Africa and the Middle East that has added to the inflationary pressures elsewhere in commodity prices for coal, iron ore, coal, grains and other foodstuffs.
In Europe inflation hit 2.6% in March, up from the annual 2.4% in February and almost guaranteeing a rate rise from next week’s meeting of the European Central Bank.
We won’t get an increase when the Reserve Bank meets Tuesday.
The list of bad news was rather daunting, starting with the Japanese quake, tsunami and then the nuclear disaster at Fukushima from March 11 onwards that has killed close to 30,000 people, caused damage estimated at $US300 billion, and now threatens to choke Japan’s confidence and economy (See story below).
Before that we had the February 22 quake in Christchurch that has hit New Zealand hard, an important economy for a host of Australian companies in the media, retailing, finance and building and construction.
January saw the bad flood in Queensland and northern Victoria, plus Cyclone Yasi in Queensland and Cyclone Carlos in the Northern Territory and parts of WA.
The Chinese economy is slowing, while interest rates are rising in other parts of Asia to try and crimp rising inflation caused by energy and food costs.
In the US overnight Thursday the Dow fell on the day, but closed close to its highest level in nearly six weeks to end the quarter up 6.4%.
The S&P 500 Index was up 5.4% and NASDAQ rose around 4.8%.
The Dow ended March up around half a per cent.
US Treasuries fell over the quarter, pushing 10-year bond up to about 3.45% from 3.30% at the end of 2010. Overall US bonds lost around 0.1% in the quarter and hit a high of 3.50%.
The ASX200 index was up 15.7 points, or 0.3%, at 4837.9, while the All Ordinaries index added 15.9 points, or 0.3%, to 4928.6.
The market has climbed more than 300 points, or 6.2%, with gains in nine of the past 10 sessions, and that pushed it to a small gain of 0.1% for the month.
For the quarter, the ASX200 advanced 2%, making it three quarters in a row of gains.
In Asia the MSCI Asia Pacific Index rose 0.7% yesterday, which helped trimmed the quarter’s loss to 1.4%, after it was off around 14% at one stage as Japan struggled with the impact of the March 11 quake, tsunami and then the Fukushima crisis which continues.
Tokyo’s Nikkei Index rose half a per cent yesterday to end the quarter and month at 9,755.1, the highest since March 11 when the earthquake and tsunami happened.
The Nikkei fell 12% over Japanese fiscal year that finished yesterday.The Index was down 4.4% for the quarter and 6.5% from March 11.
In Europe the Stoxx 600 Index lost 1% on Thursday, but was still up 09.1% for the quarter after rebounding 5.2% from its low for the quarter on March 16.
Markets were unsettled by yet more money ($US34 billion) for yet another bailout of Irish banks and the jump in inflation in March to an annual 2.6% from 2.4% in February.
The FTSE 100 in London fell 0.7% overnight to cut the quarter’s gain to just 0.2%.
In commodities, the Reuters-Jefferies CRB Commodities index rose around 7% for the quarter, a strong rise that was driven principally by oil and silver, with copper and sugar big losers.
In fact the rise in commodity price indexes underplayed the strength of all commodities.
These indexes do not measure price movements in iron ore and coal, both of which jumped sharply in the quarter; especially coal which rose after floods in Queensland, Indonesia and South Africa cut supplies of coking and thermal coals.
In oil Brent crude in London for May delivery rose $US2.18 to $117.31 a barrel after having jumped earlier to $US117.70.
Brent had fallen below $US108 in the aftermath of the March 11 earthquake and tsunami in Japan, but finished the quarter up over 23%.
Nymex WTI in New York rose $US2.36 to $US106.63, having earlier hit $US106.77. It
