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Dr. Mark Sinclair
Dr. Mark Sinclair, Mentor Education

Fidelity predicts strong year for equities.

7 January 2014

Fidelity Investments, one of Australia’s largest dealing houses has predicted that 2014 will be a strong year for Australian equities.

With a diminishing local currency and more floats tipped to  provide the base for a strong year for Australian equities, Kate Howitt Fidelity portfolio manager has suggested that consumer and export driven companies will lead the charge.  Howitt said that, “fortunately, with our major trading partners in Asia still experiencing robust growth and the United States and Europe now looking more stable, the backdrop for our economic transition is benign.”

While Fidelity doesn’t predict the 15 per cent gain for the Australian Securities Exchange (ASX) to be repeated they do forecast Barclays, BBY and Citi to all have sustained gains in 2014.

Grant Eshuys, Citi’s head of market sales, has commented that the following factors will continue to drive volumes higher than just the market performance in 2014: low interest rates, the global asset allocation shift and the fact that in Australia the IPO pipeline is open and it’s open in a manner in which we haven’t seen for quite some time.

Howitt also reiterated that, “we are now seeing the usual transition mechanisms of lower interest rates and a weaker currency beginning to breathe life back into housing construction, domestic tourism, manufacturing and exports. Australia has a number of “structural advantages” that stand it in good stead.”

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