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We are now at the ‘business end’ of taming inflation: June 2024 Quarterly Market Update

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The June 2024 Perpetual Private Quarterly Market Update reflects on the curiously buoyant market environment and investor sentiment, that have defied the challenges of ‘sticky’ inflation, rising conflict and high interest rates. In this report we consider the robust returns generated across the quarter and year, before delving into pockets of imbalance that could derail economies and markets into the end of the year. Will these ‘pockets’ prove to be headwinds or tailwinds? 

You can watch the video above, download our full report, or read our concise overview below.  

Please note: except where otherwise noted or quoted, the views in this article are those of Perpetual Private’s Investment Research Team.

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June Quarter 2024: What happened?

Whilst markets took a slight pause in momentum over the three months ending June, they retained the vast majority of the gains generated over the prior 9 months, with Australian shares1 gaining 11.9% for the year, and global share markets2 gaining an impressive 19.0%.  

Fixed Income and Real Estate experienced a more challenging quarter and year, as expected interest rate cuts got pushed further into the future, and markets finally aligned with our long-held belief that both interest rates and inflation would be ‘higher for longer’. 

Although the A.I.-led rally had begun to broaden into other sectors in the March quarter, that did not persist through the three months to June 30th. Indeed, over the year the global Information Technology sector3 gained a whopping 38.8%, with the company de jour, Nvidia, enjoying a run of 192.1%.  

Economically, different countries and regions are having differing levels of success in resolving the inflation conundrum, with the likes of the U.K, E.U. and Canada enjoying the confidence to make small reductions to their cash rates. Meanwhile, here in Australia we wait with baited breath for the June CPI release on 31st July, with any outcome at or above 1%, likely to threaten an interest rate increase at the Reserve Bank’s August meeting.

In the report

In our report to close out the financial year, we include a special article examining the U.S. presidential election and what the proposed policies of Biden and Trump might mean for investment markets. We then dive into the differing facets of our financial world and the undercurrents driving the tumultuous political landscape. Whilst it remains clear that the path to an economic soft landing remains, as described by RBA Governor Michelle Bullock, “narrow”, we find numerous areas for continued optimism and expect periods of market stress to deliver attractive opportunities for those who are able to see through the noise.

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[1] as measured by the S&P ASX 300 index

[2] As measured by the MSCI All Country World Index (AUD unhedged)

[3] as measured by the MSCI AC World information Technology index  

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If you’re looking for an expert view on where to invest in 2024 and beyond, our experienced financial advisers and investment specialists would love to help you. Contact your Perpetual Private adviser, submit the form below or call us on 1800 631 381.

Perpetual Private advice and services are provided by Perpetual Trustee Company Limited (PTCo) ABN 42 000 001 007, AFSL 236643. This information was prepared by PTCo and Perpetual Investment Management Limited (PIML) ABN 1800 866 535, AFSL 234426 and is used by PTCo. It contains general information only and is not intended to provide you with financial advice or take into account your objectives, financial situation or needs. You should consider, with a financial adviser, whether the information is suitable for your circumstances. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. The information is believed to be accurate at the time of compilation and is provided in good faith.

PTCo do not warrant the accuracy or completeness of any information contributed by a third party. Any views expressed in this article are opinions of the author at the time of writing and do not constitute a recommendation to act. This information, including any assumptions and conclusions is not intended to be a comprehensive statement of relevant practise or law that is often complex and can change. No company in the Perpetual Group (Perpetual Limited ABN 86 000 431 827 and its subsidiaries) guarantees the performance of any fund or the return of an investor’s capital. Past performance is not indicative of future performance.