March ended up a big month for the Australian stock exchange – a 1.8% gain for the month and a very tasty 3.1% jump in the quarter.
A big contrast to a year ago when the COVID-19 pandemic flattened everything – although we know now that march 22-23 was the bottom of the slump and from then on it was onwards and upwards.
The ASX 200 touched a five-week high during Wednesday’s session before dipping in the final moments to close the day 0.8% higher at 6,790 points.
March’s 1.8% rise was the best monthly performance since a 10% gain in November, and compares with a 21.1% fall in March 2020.
A year ago, the ASX 200 fell 24% (yes, 24%) in the March quarter of 2020! That was a fall of $450 billion in market value.
Tokyo rose more than 6% with the Nikkei outperforming many other markets; Hong Kong rose by more than 4% and the Chinese markets down for the quarter but higher for the month. The CSI 300 index lost around 4% in the quarter as it weakened in March.
The Aussie dollar sagged 3% or so in the month, losing 2.27 US cents (according to Reserve bank data), falling to 76.02 US cents from 28.29 US cents at the end of February.
The Trade Weighted index also dipped, down 1.4 percentage points to 63.9.
The risk-off mood lately has been set off by a surge in bond yields on fears about rising inflation (which will happen in the middle of 2021 as the 2020 base rolls over).
US Treasury 10-year bond yields surged 83 basis points in the quarter (touching 1.77% on Tuesday), the biggest increase in over a decade.
Tech stocks were sold off, even though they have made heaps of money during times of high interest rates.
The yield on 10-year Australian Government bonds rose from 0.97% at the end of December to 1.78% on Wednesday.
Gold is down more than 11% year to date, oil is up by around 25%, copper is up by around 13%.
