Market likely to turnaround

4 May 2020

There are promising signs that the market will return to being strong this year as the ASX All Ordinaries index has stayed above 5,000 points and is rising, according to Wealth Within.

Wealth Within’s chief analyst, Dale Gillham, said there was a distinct turnaround in the market last week as it moved to its highest level in seven weeks, and he believed there would be a more sustained rise over the next month.

“While I do not believe we are out of the woods just yet, as the current move up may still be a sucker’s rally, the signs are far more promising that the market will return to being strong this year,” he said.

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“If the market fails to rise above 5,800 points over the next month, it will signal that the market is weak. So, while the news is far more positive, I still recommend investors be on their guard and only buy quality stocks.”

Gillham noted that in a “huge turnaround”, energy was the top sector last week up 12% as Oil Search, Santos, Origin, and Beach Energy had all risen over 10%.

IT followed energy, up 10%, while consumer discretionary was over 9%.

He said the worst sectors included utilities (down over 1%), consumer staples and healthcare were both down just under 1%.

The best-performing stocks last week were Worley Parsons (up 30%), followed by Virgin Money (up 28%), and IOOF up (27%).

The worst performers were Qube (down 7%), and ResMed and Spark Infrastructure (both down 5%).

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