APRIL 2026
April saw equity markets post broad gains, with US shares and technology stocks rebounding sharply whilst Australian shares advanced more modestly. The ongoing conflict in the Middle East added to already elevated inflation concerns, keeping upward pressure on bond yields. The Australian dollar also rose strongly during the month, which affected returns for investors in overseas assets.
Economic Conditions
The conflict in the Middle East continued to shape the economic environment in April. The Strait of Hormuz stayed closed, keeping oil prices well above where they started the year. Oil rose to over US$118 a barrel during the month before easing to US$113 by month end.
Against that backdrop, Australia’s inflation rate recorded 4.6% in the March quarter, its highest reading in nearly three years, with fuel costs accounting for much of the rise. The Reserve Bank of Australia raised its cash rate to 4.35% at its early May meeting, the third increase this year, whilst most major central banks around the world left rates unchanged.
The Australian dollar rose 5.0% against the US dollar during April, reaching around US$0.72. Global shares returned 8.6% for hedged investors but 4.5% for those without currency protection.
Equities
US shares led global markets in April, with technology stocks among the strongest performers. Of the companies reporting results during the earnings season, 84% beat analyst expectations. US share markets reached record highs during the month.
Emerging markets rose strongly, as a weaker US dollar boosted returns. European shares were more subdued, gaining around 1%, as higher energy import costs weighed on the region more than elsewhere.
In Australia, the market rose 2.2%. Technology was the strongest sector, up 13.2%, with real estate also performing well at 8.1%. Healthcare and consumer staples were among the weakest sectors.
Fixed Interest
Bond yields remained elevated throughout April, keeping pressure on bond prices. Returns were largely flat, with Australian bonds returning 0.0% for the month and global bonds 0.3%.
The income that bonds and cash are generating remains at its highest level in more than a decade. That income continues regardless of short-term price movements, and for investors holding a mix of growth and defensive assets, it remains a meaningful contributor to overall returns.
Winners & Losers
It was a month with few losers. In the US, the S&P 500 gained 10.5% for the month, its strongest monthly return in over 5 years, whilst the Nasdaq gained approximately 15%, driven by a better than expected earnings season which saw technology stocks lead the way. Emerging markets were also strong, rising 9.2% in Australian dollar terms. Listed property rounded out the winners, with global REITs gaining 7.5%.
Gold fell around 4% in US dollar terms. In Australian dollar terms the decline was closer to 1%, as the rise in the Australian dollar offset much of the fall. Over the past year gold has gained just over 24% in US dollar terms.
Asset Class Returns – April 2026
The Value of Diversification
April is a useful illustration of why diversification matters. Share markets recovered strongly while bonds remained under pressure, and within equities, different regions moved in quite different directions. No single part of the portfolio leads every month. A diversified portfolio is built to capture growth where it emerges and provide stability where it does not, across a range of conditions and over time.