Share tips and stock recommendations for the Australian (ASX) share market – buy, hold, and sell. Michael Gable is an expert guest commentator for the stock market newsletter thebull.com.au.
This post is an extract from the newsletter dated 22 January 2024. You can access the full version of the article HERE.
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We remain bullish on iron ore for 2024 and this Canadian based producer is trading on valuations which are favourable to its peers. The share price also recently broke above a major resistance level near $8 and this should lead to substantial upside from here.
We continue to hold a bullish view on oil. Supply constraints and improving global demand should elevate energy prices from here. This means that Woodside shares are very attractive down at these levels. The share price chart also indicates very strong support at current prices.
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I have previously tipped PDN as a stock that will start to move in 2024 based on low uranium supply and improving interest in that sector. It is now starting to move higher and the upside remains substantial from here. Increases in uranium supply are still many months away and this will support the share price.
The price of lithium has fallen to levels which is causing smaller mines to shut down. The closing of mines is often seen at the lows of the commodity cycle. The share price chart for PLS has also recently shown solid buying support with possible short-covering. This means that we have likely seen the lows in the PLS share price.
Travelers have caught up for time lost during COVID but travel expenditure should start to normalise now. We also expect Qantas to increase capital expenditure to maintain their fleet. Tougher times are likely and a weak share price chart could see the share price trend lower.
The recent rally in MFG is a chance to sell it. Magellan will need to outperform the market over time before fund flows will increase, and this is still months or years away. In that time, there will be better opportunities in the market.
Michael Gable is managing director of Fairmont Equities.
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