‘We’re close to the bottom’: Expert flags share market sectors to buy before the rally

An ASX200 market analyst holds his hand to his chin and looks closely at his computer screens watching share price movementsAn ASX200 market analyst holds his hand to his chin and looks closely at his computer screens watching share price movements

Friday has brought good news for embattled investors. DeVere Group CEO and founder Nigel Green has tipped that major global indexes – such as the S&P/ASX 200 Index (ASX: XJO) – could be nearing their lowest point and getting ready to rally.

“The markets have been shaken in recent months, but now I’m calling it: the bottom is very close,” Green says.

And he’s flagged the sectors he thinks will provide buyers the biggest bounce. So, where does Green suggest investors put their money to best ride the recovery wave? Let’s take a look.

Is the ASX 200 gearing up for a rebound?

The ASX 200 has tumbled 6.38% since the start of 2022. While its downturn has likely disappointed many Australian investors, it’s fared better than other global markets.

As deVere Group’s Nigel Green points out, Wall Street has endured far greater suffering. The S&P 500 has tumbled 15% year to date while the Nasdaq Composite has fallen nearly 26%.

“The market downturn has been pretty brutal,” Green admits, “but I’m confident that we’re close to the bottom.”

“With a bounce on its way, investors should be positioning portfolios to take advantage of the rally.”

The deVere boss says it “makes sense” for investors to get exposure to sectors like energy, infrastructure, commodities, pharmaceutical, and consumer staples with strong branding ability.

Of course, those sectors are represented on the ASX 200 by the likes of energy share, Woodside Energy Group Limited (ASX: WDS) and, in infrastructure, toll road operator Transurban Group (ASX: TCL).

BHP Group Ltd (ASX: BHP) is the ASX 200’s largest commodity play while healthcare stock Telix Pharmaceuticals Ltd (ASX: TLX) represents the pharmaceutical sector.

Finally, ASX 200 retail giant Wesfarmers Ltd (ASX: WES) is behind both Bunnings and Kmart. The pair both sit among Australia’s most trusted brands.

While Green’s predictions of an upcoming rally will likely be met with excitement, he warns it’s not the time to throw caution to the wind.

“It’s not just about piling into lower-priced, high-quality investments; it is also about buying judiciously and being aware of the shifting economic landscapes and trends,” he said.

“Portfolio diversification is key and plays an essential role in managing volatility.”

The post ‘We’re close to the bottom’: Expert flags share market sectors to buy before the rally appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of January 12th 2022

More reading

Motley Fool contributor Brooke Cooper 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 positions in and has recommended Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/r8wiPsE

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s