ASX Goes Risk-off as Middle East Tensions Re-Escalate. Defensive Sectors Led the Market
Paper Mandate Market & Portfolio Commentary | 04 June 2026
Fund Status:
Bal Start: $1,155,575
Bought None
Sold: None
Bal End: $1,151,759
Cash: $143,012
Overnight Markets
Markets fell overnight due to fresh clashes between the US and Iran. Futures indicate both Australia and Asian markets are set to fall on their respective opens. Oil, as expected, rises (+2.41%) on higher middle east tensions while Gold (-1.23%) and Copper (-2.88%) fall. The US House of Reps voted to stop the war in Iran with Republicans breaking rank as the mid-terms approach. More AI Bubble talk is entering the conversation as the hyperscalers look to raise capital for DC buildouts (even Megaport in Australia), and eyewatering valuations for the IPOs of SpaceX, Anthropic and OpenAI.
Australian Market
The ASX 200 ended the day down -1.13%. The market was risk-off following the US amid the re-escalation of Middle East tensions. To make matters worse US crude inventories are at a one-year low, sparking renewed fears of supply disruptions. Materials and the Gold index fell -3.19% and -3.12% respectively. Information Technology (-1.87%) and Telecommunication (-2.21%) were similarly sold off. Defensive sectors Utilities (+1.33%) and Consumer Staples (+1.03%) were the bright spots of green in an otherwise red day.
Portfolio Commentary
While the benchmark fell -1.14%, the portfolio was surprisingly resilient, only falling -0.33%. The largest detractor today was the growth side of the portfolio. All the tech names like XRO (-4.2%), Life360 (-4.0%), and Zip (-3.7%) were down. Meanwhile, Megaport remained flat, still on their trading halt. The exposure to industrial and retail stocks protected the portfolio today; specialist office out-fitter SHAPE was the leader of the pack (+5.1%), followed by Cobram Estate and JB Hi-Fi gaining +2.0% and +3.6% respectively. Perhaps a sign that consumer discretionary is coming back into focus? Doubtful. SRG gained an additional +1.6%, continuing the momentum after the contract win.
Investment Activity
None
Disclaimer: This is a paper portfolio. Content is for educational purposes only and does not constitute financial advice. Always do your own research.