When we drill down into September 2022, the picture becomes even more telling: it was a brutal month for equities, with every sector finishing lower except Materials, which eked out a modest 0.1% gain. The key takeaways were:
- Utilities (-11.0%) was the worst performer — unusual for a defensive sector, but rising bond yields hit the rate-sensitive, long-duration utility names hardest as the RBA hiked aggressively.
- Information Technology (-9.1%) and Industrials (-8.9%) followed closely, both highly sensitive to rising interest rates and bond yields.
We believe this pattern may be useful parallel to today, with the local 10-year yield hitting 5.25% this week, rate-sensitive sectors (Utilities, IT, Industrials) face comparable headwinds now as they did in September 2022. The obvious takeout be patient with increasing exposure to these 3 sectors.
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ASX 200 Sector Performance in September 2022
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ASX 200 Sector Performance in September 2022
