Perpetual pounces on media stocks amid falling energy prices
Falling energy prices are set to boost consumer's disposable income and inject "even more life" into the consumer discretionary sector, Perpetual global portfolio manager, Garry Laurence, believes.
Laurence said, 21st Century Fox was now their Global Share Fund's largest holding and that it accounted for four per cent of the fund.
Perpetual was optimistic it would generate good returns as "it's a wonderful business with great assets and attractive valuations", and was indirectly leveraged to the consumer, he said.
"We've been buying into the consumer discretionary space in the US... as the market was selling off stocks indiscriminately in the first few months of the year, but we think falling energy prices are a stimulus to the consumer", said Laurence..
Not only had the Perpetual Global Share fund increased its holding in the consumer discretionary space, but it increased its cash position (from around eight per cent to 11 per cent), which was above the industry average, Laurence said. .
Most global share funds held up to five per cent in cash, while Australia's global share fund managers held about 10 per cent in cash, he said.
Over the last two to four weeks "the equity market bounced back", which made it a good time to get "profits and money out" and capitalise on Perpetual's January buys, he added.
He said, in January the global share fund "put cash to work", as the "fear... and... over-reaction" in markets pushed prices down.
Laurence said volatility would continue over the next six months, and although the fund manager was a "happy holder" of what they currently owned, it would look to buy only "opportunistically" when markets were weak.
He said he was currently investigating opportunities in Hong Kong, the United States, Europe, and Japan, among others.
"We're looking for strong balance sheets and good management teams….to generate good earnings growth irrespective of what is going on in the macro economy," said Laurence.
Recommended for you
Clime Investment Management has faced shareholder backlash around “unsatisfactory” financial results and is enacting cost reductions to return the business to profitability by Q1 2025.
Amid a growing appetite for alternatives, investment executives have shared questions advisers should consider when selecting a private markets product compared to their listed counterparts.
Chief executive Maria Lykouras is set to exit JBWere as the bank confirms it is “evolving” its operations for high-net-worth clients.
Bennelong Funds Management chief executive John Burke has told Money Management that the firm is seeking to invest in boutiques in two specific asset classes as it identifies gaps in its product range.
