‘Unforgiving’: ASX reporting season kills the dream of picking winners

8 September

Australian investors are facing an increasingly unforgiving share market, with almost half of the top 300 companies listed on the ASX underperforming the broader market during August reporting season, new analysis from Global X ETFs shows.

The analysis found nearly half of the biggest 300 Australian companies underperformed the Global X Australia 300 ETF (A300) during August, highlighting the growing difficulty of consistently picking individual winners.

Global X Senior Investment Strategist Marc Jocum said the lesson for investors was clear: picking winners was becoming harder as the market increasingly punished companies that missed expectations or offered weak guidance.

“This reporting season was unforgiving. The dream of picking the handful of stocks that will outperform sounds simple, but the reality is becoming increasingly difficult,” Mr Jocum said.

“When almost half the market underperforms a broad index, it is a reminder that investors don’t need to predict which seeds will grow tallest if they own the whole garden.”

Volatility was another defining feature of the season, with almost half of ASX 200 companies experiencing a daily share price move of at least 5% in either direction during August. Combined with February’s reporting season, 2026 has been one of the most volatile reporting years in recent history.

While headline earnings growth was the strongest in four years, Mr Jocum said the result was heavily skewed by resources, while the outlook was less encouraging.

“The rear-view mirror looks better than the road ahead. Earnings growth has been strong but take mining out of the equation and growth falls back into the single digits. More importantly, company guidance has generally disappointed and forward earnings expectations have been revised lower.”

Mining and healthcare were the clear standout sectors, with materials rising 12% in August while healthcare surged almost 19% for its strongest monthly gain in more than 25 years.

At the other end of the market, consumer discretionary, property and the major banks struggled as higher interest rates, softer housing conditions and pressure on household spending exposed companies to a more difficult operating environment.

“We are seeing a much clearer divide between companies exposed to the consumer and housing cycle and those with more defensive earnings,” Mr Jocum said, adding that the weakness in bank equities also highlighted the attraction of looking beyond traditional equity ownership.

“In this environment, we’d rather be the bank’s lender than the bank’s owner, favouring the income and credit stack over equity risk.”

AI was another recurring theme, with 60% of companies referencing AI on earnings calls, predominantly in the context of productivity and efficiency.

Mr Jocum said the combination of elevated volatility, divergent sector performance and an increasingly demanding market reinforced the case for broad diversification.

“Dispersion creates opportunity, but it also raises the stakes for stock pickers. Broad diversification means you do not have to predict tomorrow’s winners to participate in their growth. The market is no longer a rising tide lifting all boats. Every company is being tested on its fundamentals.

“For investors, diversification means you can spend less time getting caught up in the hype of earnings season and trying to work out which individual company announcement matters most, and more time letting the market do its thing. That can mean less stress, more time back in your diary and, in my view, potentially better investment outcomes over the long term.”

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Please contact James Mitchell, Global X ETFs | +61 413 619 034 | james.mitchell@globalxetfs.com.au

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About Global X ETFs

Global X ETFs was founded in 2008. For more than a decade, our mission has been empowering investors with unexplored and intelligent solutions. Our product lineup features over 500 ETF strategies worldwide and over US$170 billion in assets under management.¹ While we are distinguished for our Thematic Growth, Income, and International Access ETFs, we also offer Core, Commodity, and Alpha funds to suit a wide range of investment objectives.

Global X is a member of Mirae Asset Financial Group, a global leader in financial services, with more than US$800 billion in assets under management worldwide². Mirae Asset has an extensive global ETF platform ranging across the US, Australia, Brazil, Canada, Colombia, Europe, Hong Kong, India, Japan, Korea, and Vietnam with over US$208 billion in assets under management.³

<sup>1. Assets under management as at June 2026, Global X
2. Assets under management as at July 2026, Mirae Asset Financial Group
3. Assets under management as at July 2026, Mirae Asset Global Investments</sup>

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