The best and worst ASX sectors of the past 12 months

The Australian share market has delivered a mixed bag over the past 12 months. While some sectors surged on strong tailwinds, others were hit hard by weaker earnings, changing interest rate expectations, and global uncertainty.

Looking at the ASX sector data, the gap between the best and worst performers has been wide.

The best performer: Materials

The S&P/ASX 200 Materials Index (ASX: XMJ) was the clear standout over the past year, rising about 36%.

The sector includes miners and commodity producers, and it benefited from strong gains in gold, silver, copper, and iron ore prices. Gold prices surged as investors looked for safer places to park money amid geopolitical tensions and economic uncertainty. That flowed directly into higher share prices for gold miners and diversified resource companies.

China’s stabilising demand and limited new supply also helped support prices for key industrial metals. As a result, materials stocks became one of the most reliable places for investors seeking growth as the broader market moved sideways.

Solid performers: Industrials and Financials

The S&P/ASX 200 Industrials Index (ASX: XNJ) also delivered a strong result, climbing around 11.6% over the past year. Defence stocks, transport businesses, and infrastructure-related companies benefited from increased government spending and long-term contracts.

The S&P/ASX 200 Financials Index (ASX: XFJ), led by the major banks, rose about 5.3%. While gains were not spectacular, banks delivered steady earnings and attractive dividends. Falling inflation expectations and the possibility of rate cuts later in the year helped support sentiment across the sector.

Flat to modest returns: Staples, Property and Utilities

Several sectors produced only modest gains. The S&P/ASX 200 Consumer Staples Index (ASX: XSJ) rose roughly 1.6%, as supermarket and food stocks were steady, but returns were small.

The S&P/ASX 200 Real Estate Index (ASX: XRE) gained less than 1%, held back by higher interest rates and cautious property markets. The S&P/ASX 200 Utilities Index (ASX: XUJ) also delivered a small gain of under 1%, reflecting their defensive nature during uncertain times.

The worst performers: Healthcare and Tech

At the bottom of the leaderboard sits the S&P/ASX 200 Healthcare Index (ASX: XHJ), down a sharp 23.5% over the past year. Higher costs, earnings disappointments, and weaker global sentiment toward large healthcare names weighed heavily on the sector.

The S&P/ASX 200 Information Technology Index (ASX: XIJ) was not far behind, falling about 21.3%. Unlike US tech giants, many ASX tech companies struggled with slowing growth, tighter funding conditions, and valuation pressure.

Foolish takeaway

The past year shows how quickly market leadership can change. Hard assets and cash-generating businesses have outperformed high-growth stories, while sectors once seen as defensive have stumbled.

As markets move into 2026, investors will be watching whether materials can keep running, or if beaten-down sectors like healthcare and tech are finally due for a rebound.

The post The best and worst ASX sectors of the past 12 months appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.