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Paula Lyons, IG’s dealing floor

As the year draws to a close, let’s take a look back at how the Australian market and the sub-sectors have performed. Firstly, 2013 looks like being the strongest year since 2009, with the ASX 200 up over 9.8% year-to-date; however at its peak in October the index was up 17.4% (with a high of 5457).

Moving to the sectors, the worst performing sector was clearly the materials space and although the overall industrial sector is higher, certain names in the mining-services space like BLY or FGE have been smashed.

Financials

The finance sector is up a healthy 18.57% year-to-date. This is clearly down to solid performances from the big four banks, with CBA up 19.8%, WBC higher by 19.3%, ANZ up 22.1% and NAB firmer by 31.5%. Clearly the chase for income and yield has been the major theme here.

Materials

The materials sector has been the biggest drag on the ASX, falling 8.52% year-to-date. The main reason for this comes from the gold space, with the biggest mover being NCM, down over 70% since January, with traders shunning the precious metal. The iron ore providers have had a mixed year, as the China story and cost-cutting continue to impact sentiment. BHP is down 2.48% on the year, while RIO is lower by 0.4%, however FMG is seeing better days, up 20.4%.

Energy

The energy sector has seen a strong upsurge, with the sector up 5.37% year-to-date. When you see natural gas putting on 7.2% and WTI (West Tex Intermediary) 7.5%, you can see why investors and traders have been happy to buy stocks in this sector.

Consumer discretionary

Consumer discretionaries have seen the biggest increase out of all the sectors, up 29.11% year-to-date. Clearly the fifty basis points of cuts this year to the official cash rate (from the RBA) have helped sentiment towards the space. MYR is up 17.6%, DJS is higher by 15.7%, while JBH is up a massive 89.1% (all year to date). These are big gains despite many continuing to see ‘challenging conditions’.

Staples

The staples sector has seen a 7.34% increase. The main players contributing to this have been WOW which is up 11%, with WES just in front, firmer by 11.6%.  

Health

The health-care sector sources a large percentage of its revenue from overseas, and the falls in the AUD on a trade-weighted basis have been a huge benefit. This sector year-to-date has risen by 18% and could be one to watch for 2014, especially if we see AUD/USD move into the 0.8500 to 0.9000 range.

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