Expect a bull market in H2 23: Tribeca

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According to Tribeca manager Jun Bei Liu, the Australian market could see double-digit returns this year compared to a lackluster 2022.

The ASX 200 ended the year down 1%, a negative performance, but one that outperformed global peers, with the S&P 500 down 19.4% and reporting its worst year since 2008.

Liu, portfolio manager of the Tribeca Alpha Plus fund, said she expects 2023 to be a bull market in Australia.

“In 2023 we will have a much better economic climate than in 2022, people have come back from their holidays and realized they were way too bearish at the end of the year. Valuations seem reasonable, but we haven’t had a major earnings cut yet.

“We will see double-digit returns this year, the market is already at 7% and in the second half of the year we will see a bull market and reach an all-time high.

“Inflation should be under control by then, corporate cash flows are holding up well, we have good exposure to commodities and financials which will provide very good income support, and M&A will also pick up as we hit the peak of the bond yield adjustment last September.”

Looking at specific sectors that would do well, she pinpointed commodities that would benefit from the strength of the Aussie dollar, banks, select healthcare companies and stabilization in the housing market.

“A stronger Aussie dollar means commodities companies are well positioned and will do better, they are having a good run at the moment. With China reopening, sentiment is positive for the sector. My view 12 months is that they will do very well and have a good dividend payout ratio and good earnings.

“But for the next three months, it’s much more difficult to call, because they went up really hard in the first two weeks of the year and we’re not sure how long the reopening in China will last. The next few months will be a bit tough, but in 12 months they will do better.

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