Market Overview – September Quarter 2021

21 November 2021

Market update and impacts on your super

The Triple S (untaxed) Balanced Default Option returned 1.5% for the September quarter, and 20.4% for the past 12 months to 30 September (1/10/2020 to 30/09/2021).

All Super SA investment options had positive returns for the September quarter, except the Cash Option, which was flat. The performance for the growth-oriented investment options were helped by favourable returns in Australian shares, international shares, private markets, and property asset classes.






Market update and impacts on your super
Market update and impacts on your super

Triple S returns to September 2021

Investment option

3 months %

1 year %

3 years % p.a.

5 years % p.a.

10 years % p.a.

Cash

0.0

0.1

0.9

1.3

2.2

Capital Defensive

0.3

5.5

4.4

4.4

5.3

Conservative

0.5

9.6

5.9

6.0

6.9

Moderate

1.0

14.1

7.1

7.4

8.3

Balanced

1.5

20.4

9.3

9.4

10.0

High Growth

1.8

23.3

9.7

10.8

11.6

Socially Responsible

2.4

20.3

8.8

9.0

9.7


Returns net of fees and gross of tax, based on Super SA unit pricing formula.

Market overview

Australian and international share markets had positive returns for the quarter, despite the falls in September. Positive economic data and ongoing fiscal support drove upward momentum for most of the period. However, markets fell in September over concerns that supply chain disruptions and energy shortages could lead to persistent higher inflation. This has caused some volatility in markets because inflation rising quickly can cause investments to fall.

 

Australian share market

Australian shares rose as positive news regarding the rollout of vaccinations in eastern states specifically NSW and Victoria, buoyed hopes of an end to COVID-19 lockdowns. Furthermore, companies reported profit results largely in line with expectations which supported the market. However, commentary around the economic outlook was less positive with rising supply chain pressures, falling iron-ore prices and concerns around inflation.

 

Global shortages saw oil and gas prices rise sharply over the quarter and the Energy sector was the best performing. Conversely, the biggest laggard by far was Materials, which was the only sector to post a negative return. The large mining stocks fell heavily due to declines in the iron ore price and broader concerns over the slowdown in China’s economic growth.

 

International share markets

The US and European markets both followed a similar path, posting positive returns over the quarter. By contrast, emerging market shares fell. Asian shares, particularly in China suffered from regulatory changes, property market risks and slowing economic growth.

Fixed Interest

Fixed interest markets were largely unchanged. Lingering inflation increased market expectations for central banks to interest rates earlier and more aggressively than previously anticipated. In response, central banks restated the different conditions required for them to increase interest rates, and their expectation that inflation is still largely transitory. The Reserve Bank Australia (RBA) reiterated their commitment to maintaining accommodative monetary policy until full employment and inflation targets are met.

Cash

The RBA left the Official Cash Rate on hold at 0.1%. This means the interest rate for cash is close to zero. It is expected that the Cash Option will continue to return close to zero over the medium-term, after fees and taxes.

The information in the article above has been prepared in good faith by Funds SA. However, Funds SA does not warrant the accuracy of the information and to the extent permitted by law, disclaims responsibility for any loss or damage of any nature whatsoever which may be suffered by any person directly or indirectly through relying upon it whether that loss or damage is caused by any fault or negligence of Funds SA or otherwise. The information is not intended to constitute advice and persons should seek professional advice before relying on the information.

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