UBS: Australian stocks are expected to reach 5700 points by the end of this year
2014-01-23 21: 20: 16
Editor in charge: Catherine
(From this newspaper) Securities strategists at UBS (UBS) pointed out that although the current level of Australian stocks is consistent with historical levels, fund managers still believe that the cost of entering Australian stocks is high.
The UBS team updated its expectations on Thursday morning, adding Nine Entertainment, Transurban Group, Sonic Healthcare and Aristocrat Leisure to its model. The agency expects that Australian stocks will underperform global stocks, but the yield will be higher than that of the local fixed interest and cash markets.
UBS pointed out that the current price-earnings ratio of Australian stocks is 14.1 times, which is in line with its 20-year average. However, the agency said that the trading prices of banks and industrial stocks are higher than their historical averages. The increasingly cheap mining stocks have dragged down the overall Australian stock market. Multiplier (market multiple).
UBS’s strategist pointed out: “We expect that low interest rates will continue to support the valuation of Australian stocks. We do not expect interest rates to rise significantly in the next few years. All in all, we believe that the most reasonable expectation is that the Australian stock market’s earnings ratio will be in the future. Will rise in the next few years, which means that capital gains this year will be more moderate."
UBS predicts that 200 types of Australian stocks will close above 5700 by the end of this year, and capital gains will be 7% (in local currency).
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