Resurgent Australian stocks deliver best return since the pandemic

The Australian share market has posted its best return since the pandemic, recovering from the meltdown triggered by Donald Trump’s tariffs four months ago to deliver nearly double-digit gains for superannuants.

Boosted by bank, tech and gold stocks, and Wall Street’s record high on Friday, the S&P-ASX200 index closed off the 2024-25 financial year on Monday by crystallising an annual rise of 10 per cent.

That is its best performance since the 24 per cent gain recorded in the 2021 rebound after COVID-19’s arrival a year earlier and easily betters the 7.8 per cent return for the 2023-24 year.

Excluding that abnormal outcome, it is only bettered over the past 15 years by 2013’s 17.3 per cent jump.

Assuming dividends from its member companies were reinvested, the S&P-ASX200 return grew to 15 per cent.

While super funds are still finalising their end-of-year numbers, the year will translate into another healthy year for retirement pools. Two weeks ago, consultants SuperRatings put the annual return for a balanced fund to the end of May at 9.8 per cent.

It is an extraordinary recovery given the battering inflicted on global stocks after US President Trump announced his “reciprocal” tariffs on his country’s trading partners, threatening global growth.

Having hit a record high of over 8500 points, the Australian market crashed 14 per cent in seven weeks from mid-February before stabilising and resuming its upward path, breaching new highs two weeks ago.

The financial sector, which makes up 35 per cent of the S&P-ASX200, was the biggest driver of the year’s growth, surging 24.5 per cent as Commonwealth Bank leapt from one record high to another, ending the 12 months to June 30 up 45 per cent.

The tech sector was also a major contributor, rising more than 24 per cent thanks to software company Technology One (up 120 per cent) and family app group Life360 (96 per cent).

Gold companies started as tariff jitters and the geopolitical uncertainty sent investors scrambling to the safety of bullion, which topped record highs above $US3500 an ounce.

Miners Regis Resources and Genesis Minerals were two of the best three ASX200-performing stocks of the year, their shares leaping 150 per cent and 145 per cent respectively over the 12 months.

However, WA defence shipbuilder Austal stormed home to overtake the duo on the final day of trading to finish as the No.1 performer. Boosted by growing contracts in the US for the US Navy and the prospect of sharing in billions of dollars in new shipbuilding in Australia, Austal shares put on 152 per cent for the year.

Antimony play Larvotto Resources was confirmed as the all ordinaries index’s top stock, catapulting 479 per cent to 69.5¢ as the broader stock market measure finished 2024-25 9.5 per cent better.

IDP Education and Chris Ellison’s Minerals Resources were the ASX200’s worst bets, collapsing 76 per cent and 60 per cent respectively.

Australia’s dollar, often seen as a proxy for resources sector risk, gave up about US1.5¢ during the year to US65.4¢, having done no better than US69.2¢ over the period.

Iron ore, the country’s biggest export earner, also had a subdued 12 months on concerns about China’s economy, averaging just under $US101 a tonne. That’s down $US8/t from a year earlier.