Rudi's View | Feb 03 2023
As promised in Weekly Insights earlier this week, below is an overview of analysts' and share market strategists' favourites and Conviction Calls ahead of the February reporting season.
Weekly Insights: https://www.fnarena.com/index.php/2023/02/01/rudis-view-2023-will-be-different/
By Rudi Filapek-Vandyck, Editor
Put simply: corporate earnings are still facing a down-cycle this year, but there are a number of offsetting positives in the form of declining inflation, central bankers nearing the end of their tightening policies, China re-opening and broad expectations that economic recessions are not unavoidable this year.
Market strategists at Wilsons have drawn the conclusion that the sum total of this year's conflicting drivers will be a net positive for equity markets, albeit not in a major way.
In Australia, Wilsons agrees with the perception that iron ore prices are probably a bit bloated here, and this makes share prices for major bulk miners on the ASX possibly equally bloated, while local banks will not escape the impact from higher interest rates on businesses and household budgets.
Moderate, but positive returns thus, at the index level.
Wilsons' asset allocations have moved to Underweight cash and Overweight global and domestic equities, with (now) a neutral portfolio allocation to fixed income (bonds) and alternative investments (think infrastructure and gold).
In terms of ASX favourites, Wilsons has chosen the following five:
-Insurance Australia Group ((IAG))
-Mineral Resources ((MIN))
-NextDC ((NXT))
-Netwealth Group ((NWL))
-ResMed ((RMD))
Then there's a separate list from the institutional research desk, which consists of the following "investment ideas":
-Aroa Biosurgery ((ARX))
-Immutep ((IMM))
-Nick Scali ((NCK))
-PeopleIn ((PPE))
-Pro Medicus ((PME))
-ReadyTech Holdings ((RDY))
-Ridley Corp ((RIC))
-Select Harvests ((SHV))
-TechnologyOne ((TNE))
We're not done yet as Wilsons has also shared its favourites for the upcoming February reporting season:
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