The ASX could see a short-term rally from Jim Chalmers’ second federal budget while for some pockets of the sharemarket, companies could see longer-term flows.
Real estate, healthcare stocks and retailers skewed to low-income earners are the three main sectors of the sharemarket set to get a boost from the Albanese government’s second federal budget, thanks to a $15 billion welfare package and policies targeting net migration and first home buyers., had little impact on the long-term outlook for the Australian sharemarket, in the short term, equities could rally.
Even so, the broker said it was more concerned with what’s happening further afield, with its portfolio defensively positioned ahead of an expected US recession.The “budget does not change our equity strategy view,” Macquarie strategists wrote in a report to clients. “There were no major surprises, and the surplus looks short-lived.”
UBS strategist Richard Schellbach also said that while the budget supported low-income households, forecasts for equity market earnings growth, market targets and sector positioning remained unchanged. From July 1, access to the Home Guarantee Scheme will be expanded to allow any two people to buy an eligible home with just a 5 per cent deposit.
Strategists at RBC said any boost to net migration would benefit healthcare companies such as Estia Health, Regis Healthcare and Ramsay Health Care.
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