The first quarter of 2020 will go down in history as seeing the most stressed markets since the Global Financial Crisis (‘GFC’) or the late 1920s / Great Depression era.

As the year began, markets believed COVID would only affect China/Asia (much like SARS) and have a short, sharp supply-side impact on global growth. But by late February/early March, we all soon realised how contagious and deadly the virus was. Governments rapidly introduced containment measures, triggering steep falls in economic activity and corporate profits. As the coronavirus crisis accelerated its global spread and entire populations sheltered at home, global risk assets markets plunged in March leaving equities to record the fastest bear market on record. March saw the first time since 1929 that US equities market experienced daily moves greater than 4% on every day of a trading week.

After a horror March which saw most developed equity markets experience falls in value from their February highs of more than 35%, a “risk on” environment ensued with markets staging a bounce. This left Global Bonds as the worst performing market with a near 5% loss (see below). The “bounce” was in part due to the significant and quick stimulus and support measures from various governments as well as central bank activity.

In Australia,this translated into an 8.8% gain for the month with heavily beaten up Energy names rallying 25%, 22% for IT, and 16% for Discretionary retailers. The‘worst’ performing sector was Consumer Staples (Coles & WOW) at ~2.4% gain,and safe haven stocks like RMD losing 5%. In the Australian market, there were 55 equity raisings in the month which sucked a whopping $20b of investment.