Global equity markets rebounded strongly in March as prior concerns about the imminent risk of inflation subsided. The anniversary of the market’s nadir last year was reached on March 23rd which has been followed by a phenomenal rebound led by the US up 73% and Australia 53%.
The US was stronger once again in March, advancing 4.2%, although the NASDAQ was only marginally higher as technology companies were repriced to reflect higher bond yields. The European and UK economies have been ravaged by COVID restrictions but optimism concerning the vaccine rollout saw Europe advance a healthy 6.4% and the UK 3.6%. US bonds moved 28 basis points higher to finish at 1.68%, although the Australian 10-year bond yield actually fell 10 basis points to 1.8% following its sharp 80 basis point rise in February.
The Australian dollar was weaker against a strengthening US dollar, closing the month at 76c as commodity prices were more subdued.