Heading in the right direction

By Greg Smith, Head of Retail at Devon Funds

Markets had plenty to deal with again in May. Investors largely moved on from the turmoil in the regional banking sector but had a new ‘crisis’ to deal in the US debt ceiling standoff. Central bank manoeuvrings remained in the spotlight, with officials suggesting that rate pauses were in the offing. For the most part, inflation continued to head in the right direction, making for an interesting backdrop to budgets delivered during the month in Australia and New Zealand, with the latter best described as “expansionary.”

Earnings seasons on the whole were positive, and while there were some misses, better-than-feared outcomes were generally a theme.

Most markets drifted lower in a month which has historically not been particularly kind to investors. There were however upward re-ratings for several companies within the Devon funds, the most notable being Ryman Healthcare (+20%) in New Zealand and James Hardie (+10%) in Australia.