New year brings positive share market results

Australian and international share markets continued to gain ground in August, according to Morningstar's Australian Institutional Sector survey.

Coupled with July's results, the August numbers heralded a positive start to the new financial year, according to the survey.

The Australian share market gained 2.1 per cent for the month to 31 August, following a rise of 4.2 per cent for the S&P/ASX300 Accumulation Index in July.

The uptick contributed to longer-term returns of 5 per cent for the year, 3 per cent over three years and -3.0 over five years.

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But fund performance varied wildly, with the top four performing funds - Investors Mutual, Bennelong Concentrated, Bennelong and Perpetual - outstripping the median Australian share fund manager's average return of 0.6 per cent, with an average return of 7.9 per cent for the month.

Results could have been impacted by sector results, with information technology recording returns of 10.5 per cent, followed by healthcare at 6.1 per cent and consumer staples at 5.9 per cent.

However, telecommunications failed to leave a mark, while listed property and materials experienced negative returns.

News abroad was also positive, with the MSCI World ex-Australia NR USD Index posting a 2.6 per cent return. Bolstered by a 1.8 per cent fall in the $A against the $US, the index returned 4.5 per cent in Australian dollar terms over August. Much like the Australian share market, information technology performed best, returning 3.8 per cent, while telecommunications proved a poor performer.

Returns for the top-performing international share strategies - AllianceBernstein which returned 7.5 per cent, Wellington with 6.4 per cent and Dimensional with 5.6 per cent - were more in line with the median international share fund manager, which returned an average 4.6 per cent over the month.