10 February 2021
Australian shares were flat over the first month of 2021. During the month we saw continued rotation towards value and cyclically led opportunities. However, the strength and direction of the rotation faded into month- end.
For the upcoming reporting season, we expect the majority of companies to report robust profit growth and higher dividends. Certain parts of the market have displayed clear signs of speculative behaviour in recent months, with share prices becoming spectacularly detached from fundamental value in some cases.