The third quarter of this financial year has seen continuing volatility in investment markets. February saw tech stocks suffering substantial losses due to investor fears about AI destroying software company business models. This will be a continuing theme throughout this and next financial year until there is greater clarity on AI impact.
Then in March, markets yo-yoed following the US and Israeli war on Iran, and Iran’s response and retaliatory behaviour across the Middle East. Markets seemed to believe that Trump would “TACO”△, responding positively to any likely cease fires or withdrawal of deadlines.
The war resulted in energy prices increasing substantially and inflation breaking out again. This could be considered a once-in-a-generation event, possibly more consequential than the 1970s oil price shocks, and this will likely hang over markets in the medium term.
For the BUSSQ Super account, the Balanced Growth option returned -3.20% in March, High Growth returned -3.47% and Defensive performed relatively better returning -1.46%.*
Contributors to these investment option negative returns were:
- ASX 200 was down approximately 7.7% in March. Tech stocks suffered, as did banks driven by concerns about higher interest rates and fuel prices causing household budget stress;
- World markets (in US dollars terms) fell over 6.47%, however this loss was partially offset by the Australian dollar falling in value against the US dollar; and
- Bonds had a poor month also, as rising yields reduced their value.
Even though there were negative returns for all three investment options in March, their performance improved from previous months (relative to comparable investment options as reported by SuperRatings). The Balanced Growth option finished in the top 50%, and High Growth and Defensive both finished in the top 25%.**
For a full list of returns, please refer to BUSSQ’s Investment Performance.
Looking ahead
Looking forward in the near term, share markets will continue to be volatile. Any positive news on the war against Iran could see share markets test recent record highs. On the other hand, if the war drags on, which appears likely, we could see a loss of momentum in share markets, or a decline. Interest rate increases will result in further bond losses.
Already in April we’ve seen share markets respond positively to the Middle East cease fire with world markets as a whole increasing by 8.18%. Australian markets have increased by 4.27% as at 22 April 2026.†
It’s important to remember, especially when there is so much noise about share and investment markets, that your superannuation is a long-term investment. Market ups and downs are a normal part of investing, particularly when markets are responding to global events and economic change. While periods of volatility can be unsettling, history shows that staying invested with a long term focus is often more effective than reacting to short term market movements.
BUSSQ is here for you
If you have questions about your current investment strategy or if you’re thinking about switching investment options due to market volatility, we encourage you to talk to us before doing so.
Seeking personal advice from a Financial Planner is also a sound approach and can be a source of comfort and strength during stressful times. As a BUSSQ member, you have access to personal financial advice at no extra cost^. To book an appointment with a BUSSQ Financial Planner, call us on 1800 692 877.
BUSSQ recently completed an extensive program of work interrogating our investment beliefs and philosophy, our overall investment portfolio construction and our investment option menu for members.
BUSSQ recently completed an extensive program of work interrogating our investment beliefs and philosophy, our overall investment portfolio construction and our investment option menu for members.
