Reuters logo
POLL-Australian shares seen rising almost 12 pct in 2013
June 18, 2013 / 7:31 AM / 5 years ago

POLL-Australian shares seen rising almost 12 pct in 2013

* For poll data see

* S&P/ASX 200 to reach 5,200 by end-2013

* Index seen at 5,375 by mid-2014

* Bolstered by lower interest rates, weaker Australian dollar

By Maggie Lu Yueyang

SYDNEY, June 18 (Reuters) - Australia’s leading share index will end the year up almost 12 percent, shaking off concerns about major central banks rolling back stimulus and supported by lower interest rates and a weaker local currency, a Reuters poll found.

The S&P/ASX 200 index hit a five-year high of 5,249.6 points on May 15 but has since dropped more than 8 percent amid a global rout in riskier assets spurred by fears the U.S. Federal Reserve may soon decide to taper back its bond buying programme, and on concerns over slowing growth in China.

But the benchmark is expected to rebound and end 2013 at 5,200, slightly lower than seen in a March poll.

Estimates from the poll of 15 analysts, conducted over the past week, ranged from 4,500 to as high as 5,500. It closed on Monday at 4,825.9.

“Certainly the correction recently has brought more value into the share market and I think that will be embraced later in the year,” said Commonwealth Securities chief equities economist Craig James in Sydney.

Nine analysts in the poll expected the Federal Reserve to taper the size of its bond purchases either later this year or in early 2014.

“I ultimately don’t see that as a problem for equities, because that means the economy is getting better,” said David Cassidy, chief equities strategist at UBS.

For mid-2014, the Reuters poll gave a median forecast for the benchmark index of 5,375, with a range of 4,500 to 5,775.

On the home front, the Reserve Bank of Australia cut rates to a record low of 2.75 percent in May and kept the door wide open to ease further if needed. According to a separate Reuters poll, it will cut a further 25 basis points later this year.

“The low interest rates together with the lift in the local economy should be the two factors which will entice people to start to invest again,” said Commonwealth Securities’ James.

The Australian dollar, which has declined around 10 percent from a mid-April high, was seen slipping further, according to a Reuters poll earlier this month.

Citigroup’s head of equity market strategy in Australia Tony Brennan said the falling currency would benefit full year 2014 corporate earnings, while RBS Morgans chief economist Michael Knox said it would support a rally in commodity prices.

“This will support an undervalued Australian resources sector,” Knox said.

Australia is heading into a federal election in September, and analysts expected more market confidence after the poll.

For other stories from the poll see Additional reporting by Thuy Ong and Michael Sin, additional polling by Ashrith Doddi and Snehasish Das; Editing by Kim Coghill

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below