What stocks are likely to thrive when things dive

Investing in shares is like buying property, in that you've got to pick a quality asset at just the right time if you want to make serious money out...

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With global share markets looking vulnerable to further falls, what stocks are likely to perform well.
Australian companies like Woolworths and Wesfarmers have been in the headlines of late and are set to benefits from rising food demand from China’s so called dining boom, unpredictable weather issues and falling Australian dollar (now at 69US cents) to drive flood inflation.
Global Healthcare stocks such as Ramsay Health Care, CSL and Mayne Pharma are also likely to benefit from the currency and more broadly as they are less vulnerable to economic shocks because everyone needs health care, particularly in a countries with an aging population.
But timing is key in financial markets. Major stock markets are selling off in response to negative news flow, and this year some experts are tipping that May, and not now, is when people should be looking to buy.
This idea of course goes against the typical strategy which is known as sell in May and go away until September.
“After May I would be more confident jumping into to the Market,” says Mathan Somasundaram, quant strategist at stockbroking firm Baillieu Holst.
He adds that holding off to sell in May won’t apply this year particularly if the United States economy experiences a pull back in consumer spending habits as people get cautious about the impact of higher interest rates leading to a potential recession.
Indeed in May, the federal budget will also be delivered so we should also get more clarity around any increase in taxes, which is looking highly likely under the Turnbull government.


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