The “inflationary” tones from the federal budget could provide a fresh tailwind for the sharemarket, especially for retail and real estate stocks, according to brokers.
Already a subscriber?The Australian sharemarket is set to receive a fresh boost from the federal government’s spending spree, with a $7.8 billion cost-of-living package expected to support the retail and property sectors which may push the bourse to a fresh record.over the next four years, in a move that Treasury said would cut inflation by 0.5 percentage points next financial year.But UBS economists highlighted that the $9.
UBS noted that Super Retail Group, Collins Food and Domino’s Pizza were all skewed towards that lower socio-economic demographic and should therefore benefit from the measures. “Overall, the budget incrementally supports our positive consumer view headed into FY25,” said Citi analyst Adrian Lemme.The broker also believes that the $153.5 million net increase in pathology funding over the next three to four years would boost stocks in the sector including Healius, Integral Diagnostics and Sonic Healthcare.
Meanwhile, the $6.2 billion allocated to new housing investment, and the additional $1 billion to help states and territories build more homes, would be positive for Brickworks and Reece, the broker said.Mr Schellbach said there were few stocks that would be negatively affected from the budget, but warned that there was pressure building on rental and housing shortages which could be a headwind for education providers.
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