June, 2023
The broad MSCI World ex-Australia Accumulation Index returned 7.3% in hedged terms and 7.6% in unhedged terms over the quarter, as the Australian dollar weakened modestly against the US dollar and most major developed market currencies. Strongest performing sectors were Information Technology (15.4%) and Consumer Discretionary (11.4%), while Energy (flat) and Utilities (0.1%) underperformed on a relative basis. Other global share indices also produced positive results, such as the MSCI Small Caps Total Return Index (4.0%) and the MSCI Emerging Markets Accumulation Index (1.5%).
Over the June quarter, the S&P 500 Composite Index (8.7%), the Dow Jones Industrial Average (+4.0%) and the NASDAQ Composite Index (12.8%) were all well ahead in USD terms. European markets were mostly positive (in local currency terms), with CAC 40 (France, 3.5%) and DAX 30 (Germany, 3.3%) indices higher, while the FTSE 100 Index (UK, -0.3%) was down slightly. Equity returns were mixed across Asia. The SSE Composite (China, -2.2%), Hang Seng (Hong Kong, -6.0%) decreased, while the TOPIX (Japan, 14.4%) and S&P BSE 500 (India, 12.6%) increased, all in local currency terms.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-Q2-JUN-2023-1-3.pdfMarch, 2023
The broad MSCI World ex Australia Accumulation Index increased 7.1% in hedged terms and 9.2% in unhedged terms over the quarter, as the AUD weakened against most major developed market currencies. The strongest performing sectors were IT (22.7%) and Communication Services (19.6%), while Energy (-2.3%) and Healthcare (-0.4%) were the worst performers. Other global shares indices produced positive results as the MSCI Small Caps Total Return Index returned 5.7% and the MSCI Emerging Markets Accumulation Index returned 5.3% over the quarter.
Over the March quarter, the S&P 500 Composite Index (7.5%), the Dow Jones Industrial Average (0.9%) and the NASDAQ increased (16.8%), all in USD terms. European markets experienced positive returns, as the FTSE 100 (United Kingdom) (3.6%), the CAC 40 (France) (13.4%) and the DAX 30 (Germany) (12.2%) increased, all in local currency terms. Equity returns were mostly positive across Asia as the SSE Composite (China) (5.9%), Hang Seng (Hong Kong) (3.5%) and TOPIX (Japan) (7.2%) increased, while the S&P BSE 500 (India) (-5.9%) decreased, all in local currency terms.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-Q1-MAR-2023-1-1.pdfDecember, 2022
December was a disappointing end to a bad year for markets. Investors had few places to hide as traditional safe haven assets such as bonds fell in tandem with equities. The final month of the year saw negative returns for equities, commodities and bonds as fears that have driven negative investor sentiment for most of 2022 returned: no end in sight for monetary tightening and uncertainty over the duration and severity of the economic slowdown that started in 2022.
Over December, Hedged Developed Markets Overseas Shares returned -5.2%, following two strong consecutive positive months. For 2022 as a whole, equities had their worst year since 2008. Global equities and the S&P 500 ended the year near bear market territory (defined as a decline of more than 20%), while the NASDAQ ended the year down by over 30% in USD terms. In December, negative market sentiment returned as investor focus pivoted from favourable inflation trends towards continued monetary tightening and the ongoing economic slowdown, which earnings estimates may not yet fully reflect.
Emerging markets declined to a lesser extent than Overseas and Australian shares, posting a -2.6% decline for the month of December. Weakness in India, Brazil, Taiwan and Korea were offset by strengthening Chinese share as investor sentiment improved amid the rapid reopening of its economy.
Hedged Overseas Government Bonds returned -2.2% over the month as bond yields rose across major regions as fixed income investors positioned for the continuation of monetary tightening following hawkish guidance from all major central banks over the month. Ten-year US yields rose by 13 basis points to end the month at almost 3.9%, while 30-year yields also rose by around 20 basis points to almost 4.0%. Yield movements were more substantial for Germany and the UK where 10 year yields increased by 50-60 basis points. Inflation expectations for the US, as measured by the 10-year inflation breakeven rate, fell from 2.37% to 2.30%.
Australian shares outperformed their Hedged Overseas counterparts in December. The ASX 50 was the top performing Australian index, despite declining -3.0%, meanwhile the ASX mid 50 was the worst performer, declining 4.6%. The best performing sector for the month was Materials (-1.1%) with the big miners BHP, Rio Tinto and Fortescue adding 1.1%, 7.1% and 7.1% respectively, they were also the top three positive contributors to the ASX 300. Meanwhile CBA and Transurban were the largest detractors, declining -4.9% and -8.9% respectively.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-Monthly-Report-DEC-2022.pdfSeptember, 2022
The broad MSCI World ex Australia Accumulation Index increased 0.3% in unhedged terms and decreased -5.2% in hedged terms over the quarter, as the AUD weakened against most major currencies over the period. The strongest performing sectors were Consumer Discretionary (7.3%) and Energy (5.5%), while Communication Services (- 7.0%) and Real Estate (-5.5%) were the worst performers. Other global shares indices produced mixed results as the MSCI Small Caps Total Return Index returned 1.3% and the MSCI Emerging Markets Accumulation Index returned -5.4% over the quarter.
Over the September quarter, the NASDAQ (- 4.1%), the S&P 500 Composite Index (-4.9%) and the Dow Jones Industrial Average decreased (-6.2%), all in USD terms. European markets experienced negative returns, as the FTSE 100 (United Kingdom) (-2.7%), the CAC 40 (France) (-2.5%) and the DAX 30 (Germany) (-5.2%) decreased, all in local currency terms. Equity returns were mixed across Asia as the S&P BSE 500 (India) (10.9%) increased, while the SSE Composite (China) (-11.0%), Hang Seng (Hong Kong) (-20.1%) and the TOPIX (Japan) (-0.8%) decreased, all in local currency terms.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-Q3-SEP-2022.pdfJune, 2022
The broad MSCI World ex Australia Accumulation Index decreased -8.4% in unhedged terms and decreased -15.1% in hedged terms over the quarter, as the AUD weakened against most major currencies over the period. The strongest performing sectors were Energy (3.6%) and Consumer Staples (2.3%), while Consumer Discretionary (-16.8%) and IT (-14.6%) were the worst performers. Other global shares were negative as the MSCI Small Caps Total Return Index returned -9.4% and the MSCI Emerging Markets Accumulation Index returned -3.3% over the quarter, all in AUD terms.
Over the June quarter, the NASDAQ (-22.4%), the S&P 500 Composite Index (-16.1%) and the Dow Jones Industrial Average decreased (- 10.8%), all in USD terms. European markets experienced negative returns, as the FTSE 100 (United Kingdom) (-3.7%), the CAC 40 (France) (-8.9%) and the DAX 30 (Germany) (-11.3%) decreased, all in local currency terms. Equity returns were mixed across Asia as the SSE Composite (China) (4.5%) and Hang Seng (Hong Kong) (0.9%) increased while the S&P BSE 500 (India) (-10.0%) and the TOPIX (Japan) (-3.7%) decreased, all in local currency terms.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-Q2-Jun-2022-4.pdfMarch, 2022
The broad MSCI World ex Australia (NR) decreased -5.0% in hedged terms and decreased -8.4% in unhedged terms over the quarter, as the AUD appreciated against major currencies over the period. The strongest performing sectors were Energy (26.4%) and Utilities (-2.0%), while Consumer Discretionary (-13.5%) and Communication Services (-13.3%) were the worst performers. Other global shares were negative as the MSCI Small Caps (TR) Index returned -9.4% and the MSCI Emerging Markets (NR) Index returned -9.9% over the quarter, all in AUD terms. Over the March quarter, the NASDAQ decreased -9.1%, the S&P 500 Composite Index decreased -4.6% and the Dow Jones Industrial Average decreased -4.1%, all in USD terms. European markets experienced mixed returns, with the FTSE 100 (United Kingdom) increasing 2.9%, the CAC 40 (France) decreasing -6.7% and the DAX 30 (Germany) decreasing -9.3%, all in local currency terms.
The fund underperformed the benchmark over the quarter by 2.0%. Both asset allocation and stock selection detracted from performance. At an asset allocation level, an overweight exposure to financials contributed to performance, whilst overweight exposure to consumer discretionary and underweight exposure to energy detracted. An overweight holding in Intact Financial Corp contributed to performance, whilst overweight exposure to Meta and an underweight holding in Apple detracted.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-Q1-Mar-2022-4.pdfJune, 2021
The broad MSCI World ex Australia ( NR ) increased 7.6% in hedged terms and increased 9.3% in unhedged terms over quarter, as the AUD achieved negative returns against major currencies over the period. The MSCI Emerging Markets ( NR ) index both returned 6.6% over the quarter. all in AUD terms
Over the June quarter, the NASDAQ increased 9.5% the S7P 500 Composite index increased 8.5% and the DOW jones in#drustrial Average increased 5.1 % all-in USD terms. Most European markets experienced positive in return, with the FTSE 100 (UK) increasing 5.7%
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Mercer-Funds-quarterly-report-Q2-2021-4.pdfDecember, 2020
The broad MSCI World ex Australia (NR) increased 11.7% in hedged terms and increased 5.7% in unhedged terms over the quarter, as the AUD appreciated against major currencies over the period. The strongest performing sectors were Energy and Financials, while Consumer Staples and Healthcare were the worst performers. Other global shares were also positive as the MSCI Small Caps (TR) Index increased 15.1% and the MSCI Emerging Markets (NR) Index returned 11.2%, all in AUD terms. Over the December quarter, the NASDAQ increased 15.4%, the S&P 500 Composite Index increased 12.1% and the Dow Jones Industrial Average increased 10.7%, all in USD terms.
Most European markets experienced positive returns, with the FTSE 100 United Kingdom (UK) increasing 10.9%, the CAC 40 (France) increasing 15.8% and the DAX 30 (Germany) increasing 7.5%, all in local currency terms. Equity returns were positive across Asia as the Indian BSE 500 increased 23.2%, the SSE Composite (China) increased 7.9%, the Japanese TOPIX increased 11.2% and the Hang Seng (Hong Kong) increased 16.2%, all in local currency terms.
The fund outperformed the benchmark over the quarter by 1.0%. Strong contributions from Baillie Gifford and Arrowstreet offset underperformance from the other managers. Asset selection had minimal contribution, whilst stock selection was the key contributor to excess returns. Overweight holdings in Pinduoduo Inc, Charles Schwab and an underweight holding in Apple were key contributors.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/MMF-quarterly-report_Q4-2020-3.pdfSeptember, 2020
The broad MSCI World ex Australia (NR) increased 6.4% in hedged terms and increased 3.8% in unhedged terms over the quarter, as the AUD appreciated against most major currencies over the period. The strongest performing sectors were Consumer Discretionary and Materials, while Energy and Real Estate were the worst performers. Over the September quarter, the NASDAQ increased 11.0%, the S&P 500 Composite Index increased 8.9% and the Dow Jones Industrial Average increased 8.2%, all in USD terms. Most European markets experienced negative returns, with the FTSE 100 United Kingdom (UK) decreasing 4.0%, the CAC 40 (France) decreasing 2.0%, all in local currency terms. Whilst the DAX 30 (Germany) increased 3.7% over the quarter. Equity returns were positive across most of Asia as the Indian BSE 500 increased 10.5%, the SSE Composite (China) increased 7.8% and the Japanese TOPIX increased 5.2%, all in local currency terms. However, the Hang Seng decreased 2.6`)/0 from last quarter.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/MMF-quarterly-report_Q3-2020.pdfticker: MIN0015AU
commentary_block: Array
factsheet_url:
https://www.multimanager.mercer.com.au/fund-facts/single-sector-funds.html
Go to quarterly reports, then Manager Performance select Australian Shares section
release_schedule: Quarterly
fund_features:
Mercer International Shares Fund aims to exceed the benchmark, before management costs, over the medium to long term. The Fund provides exposure to international share markets utilising an actively managed, multi-manager approach. It invests predominantly in shares in developed markets but may also have an allocation to shares in emerging markets.
- Diversification is achieved at the manager, country, sector and stock levels, with a focus on operational efficiency and sustainability.
- Benchmark : MSCI World Index (ex Australia).
- Asset allocation : International Shares (90-100%), Cash (0-10%)
- ESG considerations, including labour standards, climate change, and principles of sustainable investment are incorporated throughout the Fund’s investment decision making and ownership practices.
manager_contact_details: Array
asset_class: Foreign Equity
asset_category: Large Blend - Multi-Manager
peer_benchmark: Foreign Equity - Large Multi-Manager Index
broad_market_index: Developed -World Index
structure: Managed Fund