Marc Jocum
The timing of the February reporting season may prove an unexpected silver lining for Australian equities, as strong corporate earnings provide investors with a fundamental anchor at a time when geopolitical headlines risk dominating sentiment.
The Australian share market climbed 4% over February, its best reporting season since 2017, with companies overwhelmingly outperforming expectations.
Marc Jocum, Senior Product and Investment Strategist at Global X ETFs, said the February reporting season delivered a decisive turning point for local investors.
“While the ASX won’t be fully insulated from global risk-off sentiment, Australia’s commodity-heavy index is acting as a natural geopolitical hedge. Energy producers benefit from oil spikes, gold miners from safe‑haven flows, and critical minerals are supported by both geopolitical risk premiums and long-term AI infrastructure demand,” Mr Jocum said.
“This was a genuine blockbuster reporting season for Australian companies and a potential catalyst to lure investors back to the domestic market after years of underperformance versus global peers,” he said.
“Geopolitics may dominate headlines in the short term, but over the long run, it is earnings growth that ultimately drives equity markets. Reporting season served as a reminder that beneath the noise of global conflicts, corporate fundamentals remain the primary engine of long-term returns.”
Mr Jocum said earnings revision momentum is now the strongest in more than three years, and the market is pricing mid double‑digit EPS growth for FY26.
Resources and banks headlined the winners’ circle. Superloop (+28.3%), Lynas Rare Earths (+27.4%) and Iluka Resources (+25.9%) led the market, reflecting renewed demand for critical minerals and rising commodity prices. Financials also surprised to the upside, with Commonwealth Bank delivering its strongest single‑day gain in six years post-results.
Conversely, healthcare, technology and discretionary sectors lagged. Temple & Webster (-31.6%), Webjet parent WEB Travel Group (-30.1%) and Pro Medicus (-29.4%) were among the sharpest decliners as elevated expectations collided with softer guidance and margin pressure. Meanwhile, Australian consumers are showing a more cautious hand when it comes to discretionary spending, with a clear tilt toward essentials. The nation’s household savings ratio has climbed to its highest level since September 2022, suggesting households are choosing to rebuild buffers as they navigate the possibility of further tightening from the RBA.
Despite individual stock swings, broad‑based exposure proved a powerful advantage. The Global X Australia 300 ETF (A300) returned +4% in February, outperforming 72% of ASX 300 companies.[1]