Diplomatic efforts continued on the Korean Peninsula, with:

• North Korea announcing its intention to stop nuclear testing,
• the first meeting between North and South Korean leaders since 2007 and
• expectations that Kim Jong-un will meet with Donald Trump in the coming weeks

all encouraging signs of progress towards a peaceful resolution.

Already heightened tensions between Russia and Western Powers increased further over the month in the wake of an alleged chemical weapon attack in Syria and Russia’s support of the Assad regime. Following the attack, the US initially responded with increased sanctions against Russia and subsequently military action in Syria in a strike described as a “one-time move” by President Donald Trump.

News on the global trade front was more mixed. Positive developments included communications from top US officials suggesting progress is being made in de-escalating tensions with China, whilst the possibility that European exemptions from US steel and aluminium tariffs may not be renewed is a definitive negative.

Equities

The major markets all traded up over the month with UK and Europe leading the charge whilst the US was the laggard of global developed markets. Emerging markets underperformed the major developed markets (with the exception of the US) over the period.

From a developed markets sectoral perspective, energy companies were the stand-out performers as oil prices spiked whilst consumer staples, industrials and IT lagged.

In Australia, energy companies led the index higher with materials and healthcare the next best performers. The financial sector performed worst over the period, with revelations arising from The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry weighing on the sector.

Bonds

Global bond yields resumed their upward trajectory with ten year US Treasury yields briefly rising above 3% for the first time since 2014 late in the month (rising bond yields are negative for bond returns).

Yields in Europe, UK and Japan all rose as well over the month, albeit to a lesser extent than in the US where inflationary pressures are more acute.

Australian bonds followed offshore cues despite the Reserve Bank of Australia leaving monetary policy on-hold for its 19th consecutive meeting.

Currencies

Of the global developed market currencies the Australian Dollar weakened most materially against the US Dollar during April, driven by rising interest rate expectations in the US, although it did experience small falls against the Euro and the British Pound.

The Australian Dollar rose against the Japanese Yen over the month however, with improving global risk appetite weighing on the ‘safe haven’ currency.

Commodities

Oil was the main story in April, with OPEC’s announcements that output fell to a one-year low and that “the oil glut is almost cleared”, firmly supporting prices. In addition, news that Saudi Arabia aims to materially increase the oil price in advance of its listing of Saudi Aramco in 2019, saw crude oil prices surge from US$63/bbl to $68.57 over the course of the month.

Metal indices recovered some of their lost ground over the month, with Australian commodity exporters supported by a strong rally in iron ore prices. Aluminium prices were initially well bid as severe sanctions looked likely to curb production from Russian producer Rusal, before some easing in rhetoric from the US Treasury caused these fears to dissipate somewhat.

Precious metals fell during April as risk appetite and increasing interest rate expectations helped to coax investors away from these stores of value.

Performance of key markets 

Asset class	Index	Month (% change)	FYTD (% change)	1 year (% change)
Australian Shares	S&P/ASX 200 Acc. Index	3.9	8.3	5.5
International Shares	MSCI World Ex Aust Unhedged A$ Net Return	2.8	12.4	12.4
International Shares	MSCI World Ex Aust Hedged A$ Net Return	2.0	9.7	11.8
US Shares	S&P 500 Index	0.4	11.0	13.3
UK Shares	FTSE 100 Index	6.8	6.0	8.5
Japan Shares	Nikkei 225 Index	4.7	14.1	19.3
Australian Property	S&P/ASX 200 A-REIT Index	4.5	7.3	1.0
Australian Fixed Interest	Bloomberg AusBond Composite Index	-0.3	1.9	2.2
Australian Cash	Bloomberg AusBond Bank Bill Index	0.2	1.5	1.8
Currency	AUD/USD	-1.9	-2.1	0.6

Returns are for periods to 30 April 2018. Past performance is not an indication of future performance.

Investment returns

Find out how your TelstraSuper investment options are performing by checking out the latest returns online. 

SEE LATEST RETURNS