BT Monthly Markets Chart Pack – March 2010

An overview of movements in global financial markets

2

Global share markets were stronger in March...

Global share markets rallied throughout March as stronger economic data and some positive rhetoric from US Federal Reserve officials added to optimism that the global recovery will continue. In the US, the benchmark S&P 500 Index closed the month 5.9% higher, and there were similar gains in Europe (+7.4%), the UK (+6.1%) and Japan (+9.5%).

The Australian share market posted its second consecutive monthly gain in March, with the S&P/ASX 200 Accumulation Index closing the month 5.8% higher thanks to a series of better-than-expected economic data and some strong performances from our big miners.

3

Global shares measured by the MSCI World ex-Australia (net dividends) Index in A$.Source: BT Financial Group, MSCI

Impact of major market events on global shares since 1988

…and continue to perform well over the long-term, despite some major market events

700

1,200

1,700

2,200

2,700

3,200

3,700

4,200

4,700

5,200

5,700

6,200

Mar-88 Mar-90 Mar-92 Mar-94 Mar-96 Mar-98 Mar-00 Mar-02 Mar-04 Mar-06 Mar-08 Mar-10

Jan 91Gulf War

Feb 94Bond Market Crash

Aug 97Asian Currency Crisis

Jul 98Russian Bond Crisis

Jul 01Tech Wreck

Sep 01Attack on Twin Towers

Jun 07US Sub-prime Crisis

Nov 89Fall of the Berlin Wall Mar 03

Troops enter Iraq

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Source: BT Financial Group, Premium Data

S&P/ASX 200 Accumulation Index – year to 31 March 2010

The Australian share market closed 5.8% higher in March

24,000

25,500

27,000

28,500

30,000

31,500

33,000

34,500

36,000

31/03/2009 31/05/2009 31/07/2009 30/09/2009 30/11/2009 31/01/2010 31/03/2010

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Key Australian economic news – March

The Reserve Bank of Australia raised interest rates by 0.25% following its early April meeting, taking the official cash rate to 4.25%. It was the Bank’s fifth rate rise in the past six meetings.

The Australian economy expanded in the December quarter, with GDP up 0.9%. The result was in line with market expectations.

Job advertisements fell 1.0% in March, though this comes after a massive 13.1% gain in February.

Consumer confidence was only slightly better in March, with the Westpac/Melbourne Institute’s consumer sentiment survey gaining just 0.3% during the month.

The Australian economy added a further 19,600 jobs in March while the unemployment rate remained unchanged at just 5.3%.

Source: BT Financial Group

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The Australian dollar continued to rise against the US dollar in March

The Australian dollar (A$) made further gains against the US dollar in March, up 2.4% on the back of stronger economic data and expectations of more rate hikes by the Reserve Bank.

The A$ is now up 52% against the US$ since hitting a low of US$0.6012 cents in October 2008 and may yet hit parity with the US currency later this year, particularly if the differential between our interest rates and theirs continues to widen.

At the end of March:

A$1 bought US$0.9167 +2.4%

€0.6786 +3.3%

¥85.67 +7.8%Source: BT Financial Group

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Currency markets – A$ per US dollar

Source: BT Financial Group. Figures at 31 March 2010

0.6300

0.6600

0.6900

0.7200

0.7500

0.7800

0.8100

0.8400

0.8700

0.9000

0.9300

0.9600

0.9900

Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10

The Australian dollar versus the US dollar…

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Currency markets – A$ per Euro

the Euro…

0.4900

0.5050

0.5200

0.5350

0.5500

0.5650

0.5800

0.5950

0.6100

0.6250

0.6400

0.6550

0.6700

0.6850

Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10

Source: BT Financial Group. Figures at 31 March 2010

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and the Yen

55

60

65

70

75

80

85

90

95

100

105

110

Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10

Currency markets – A$ per Yen

Source: BT Financial Group. Figures at 31 March 2010

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Official world interest rate movements – March

Interest rates in the major economies remained unchanged in March. The Reserve Bank of Australia raised the official cash rate by a further 0.25% (to 4.25%) in early April.

Current rate Last movedDirection of last move

Australia 4.25% Apr 2010

US 0% - 0.25% Dec 2008

Europe (ECB) 1.00% May 2009

Japan 0.10% Dec 2008

United Kingdom 0.50% Mar 2009

Source: BT Financial Group

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Source: BT Financial Group

31 March 2010

Global share market returns

1 year 3 years (pa) 5 years (pa)

Global

S&P 500 Index (US) 46.57% -6.29% -0.19%

Nasdaq (US Tech.) 56.87% -0.33% 3.70%

Nikkei 225 (Japan) 36.75% -13.76% -1.01%

Hang Seng (Hong Kong) 56.45% 2.37% 9.46%

DAX (Germany) 50.65% -3.82% 7.19%

CAC (France) 41.56% -10.98% -0.47%

FTSE 100 (UK) 44.66% -3.44% 3.02%

Australia

S&P/ASX 200 Accum. Ind. 41.71% -2.44% 8.07%

S&P/ASX Small Ordinaries 58.06% -7.48% 5.84%

S&P/ASX 300 Listed Prop. 42.00% -23.27% -7.20%

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Short-term asset class performance

Source: S&P/ASX 200 Accumulation Index, MSCI World ex-Australia (net dividends) Index in A$, S&P/ASX 300 Property Index, UBS Composite 0+ years index, Barclays Capital Global Aggregate Bond Index hedged to $A , UBS Bank Bill 0+ years

1-year rolling returns to 31 March 2010 (%) Best performing asset class for the year

2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995

Australian cash

3.54 6.69 6.99 6.21 5.80 5.56 5.11 4.91 4.77 6.36 5.24 5.09 5.41 7.14 7.89 6.21

Australian bonds

2.73 12.77 4.29 3.70 6.74 4.80 4.17 10.09 2.35 11.82 1.79 6.65 15.68 12.56 12.80 2.37

Australian property

42.00 -58.05 -24.16 28.62 18.48 19.97 13.94 13.84 17.38 13.03 2.91 4.26 28.76 19.95 4.71 1.82

Australian shares

41.71 -29.52 -7.04 21.78 30.35 25.63 23.41 -11.93 12.15 3.90 13.18 10.71 18.21 13.55 20.92 -1.89

International bonds

10.24 7.02 8.01 6.38 4.85 6.82 7.66 13.38 5.73 10.83 1.66 8.43 12.55 10.01 14.58 5.55

International shares

14.47

-24.48 -14.56 1.47 27.96 8.80 13.74 -33.38 -12.67 -7.05 27.06 18.40 56.60 9.13 12.51 4.56

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Source: S&P/ASX 200 Accumulation Index, MSCI World ex-Australia (net dividends) Index in A$, S&P/ASX 300 Property Index, UBS Composite 0+ years index, Barclays Capital Global Aggregate Bond Index hedged to $A

1-year returns to 31 March 2010 (%)

Short-term asset class performance (cont’d)

14.5

10.2

41.7

42.0

2.7

-24.5

7.0

-29.5

-58.1

12.8

31 March 2009

31 March 2010

Australian bonds

Listed property

Australian shares

Global bonds

Global shares

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Long-term asset class performance

Note: Accumulated returns based on $1,000 invested in December 1984Source: S&P/ASX 300 Accumulation Index, MSCI World ex-Australia (net dividends) Index in A$, S&P/ASX 300 Property Index, UBS Composite 0+ years index, UBS Bank Bill 0+ years

31 March 2010

Australian bonds

Listed property

Australian shares

Cash

Global shares

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Source: BT Financial Group. West Texas Intermediate oil price at 31 March 2010

Oil prices – US$ per barrel

Oil prices rose 5.1% in March on expectations that fuel demand will increase in line with the global recovery

$0

$15

$30

$45

$60

$75

$90

$105

$120

$135

$150

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10

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