‘Shaken, not stirred’: Aussie investors remain confident, survey shows

COVID-19 has only slightly dented confidence in Australian capital markets and listed companies when compared with 2019, a survey of more than 1,000 ‘mum and dad’ investors shows.

Eighty two per cent of Australian retail investors were confident in publicly listed Australian companies, according to Chartered Accountants Australia and New Zealand’s (CA ANZ’s) mid-June Investor Confidence Survey.

These investors believed — pre Victoria’s six-week lockdown — that the local economy would recover strongly from COVID-19, had faith in the ASX’s history of bouncing back, and were confident in the Australian government’s response, CA ANZ says.

Around three quarters (79 per cent) of investors had confidence in Australian capital markets; a 6 per cent dip from last year’s survey.

This contrasts to investing internationally, with over one third saying they have very little or no confidence; down 12 per cent from last year.

“This level of investor confidence is more than surprising in the face of what the OECD has described as the most severe economic recession in nearly a century,” CA ANZ’s Amir Ghandar says.

“A sense of optimism has clearly been growing as the nation weathered the pandemic, but uncertainty remains as to the speed and depth of an economic recovery.”

However, Ghandar said investors were not ignoring risk. More than half (53 per cent) are expecting “a great deal” or “quite a bit” of additional disclosure in companies’ financial statements, focusing on COVID-19’s impact on operations and results.

“Investors are also interested in the impact on liquidity and business outlook, changes in demand for products and services, and impact on supply chain and distribution,” he says.

A reality check may be due later in 2020, Ghandar says.

“Almost half of investors [are] saying companies and auditors flagging ‘material uncertainty’ will have a possibly significant impact on their confidence.”