In July the Australian Growth Fund returned +2.2%, ahead of the benchmark index which rose +1.6%. Energy was the best performing sector on the Australian share market, rising +12% in the month as unrest flared up in the Middle East. Financials (+6%) also performed well as the major Australian banks rebounded after a softer few months prior. Information Technology (-3%) and Industrials (-1%) fell modestly and were the worst performing sectors.

Atlassian (+28%) was our best-performing company, benefitting from some constructive comments and updates from US peers. It also appeared to benefit from a more general rotation by investors into software, possibly at the expense of semi-conductors and Artificial Intelligence intensive companies, which had performed strongly in prior months. Atlassian will deliver a quarterly financial update to the market in early August.

Conversely, Fineos (-11%) and datacentre operator NextDC (-8%) were two of our worst-performing companies from a share price perspective during the month. Despite this, both companies provided positive updates in the month. Fineos provided a quarterly cash flow update in which it reported lower cash flows in the June quarter due to timing of cash receipts but maintained its FY26 revenue guidance. Fineos also signed two new material contracts with customers in the period. This bodes well for future revenue growth and cash flow generation. NextDC noted that, as at the end of June, it had increased its number of customer contracts by 11% compared to the last market update in April. Both Fineos and NextDC will release more comprehensive financial results and commentary in August.