The big four banks have moved further into the red over the past week, with Westpac pulling financials down with its nine per cent drop.
Dale Gillham, chief analyst at Wealth Within said that next to Westpac, ANZ fell 6.5 per cent, National Australia Bank fell four per cent, and Commonwealth Bank performed the best, down only three per cent.
Money Management used FE Analytics to look at the market sectors given they all took a drop over the week, with materials and financials down four per cent, and energy, healthcare and information technology down three per cent.
One sector which actually moved up last week was utilities, which rose two per cent despite performing poorly overall this year.
FE Analytics showed all sectors were sitting in the negative for the month, with the S&P ASX 200 Financials index sitting at the top with returns of -2.12 per cent.
Materials sat just under financials, with the S&P ASX 200 Materials index returning -2.72 per cent for the month. Gillham said the sector was down 13 per cent from its high of 12,585 points in May, but believed the down move was coming to an end.
“If this is correct, this sector will pull the All Ordinaries Index up with it when it turns to move up,” he said. “In this sector, Fortescue was hit hardest as it is down 6.5 per cent, South32 fell six per cent, while BHP and Rio were down around four per cent.”
Gillham said while the price of iron ore was stable, a declining US market and strengthening Australian dollar put pressure on miners, who benefit from a weaker Australian dollar.
“That said, I believe the materials sector has a lot of upside potential and will continue to present good opportunities in the coming months, therefore my recommendation is to watch this space,” he said.
Information technology returned -3.26 per cent for the month, with consumer staples trailing behind at -3.31 per cent and healthcare returning -3.89 per cent.
The chart below tracks the performance of the sectors for the month to date.
Gillham also said the market was looking more bullish right now and was optimistic it would trade up to at least 6200 and possibly as high as 6400 points by the end of the year.
“I expect that the all-time high of 6873.2 points from 2007 will be challenged by the end of the first quarter of in 2019,” he said.
