Are you looking for a safe harbour from the vagaries of domestic interest rates ahead of the Reserve Bank's decision tomorrow?
The bad news is that it's very difficult to find one as equities in Australia and around the world have become the most sensitive they've ever been to central banks' actions thanks to the flush of liquidity and record low lending rates.
It's a lot like the analogy of the ebb and flow of tides lifting or sinking all boats, although there's a group of stocks that should be relatively unaffected by what the Reserve Bank of Australia (RBA) does to the cash rate.
The RBA will announce its rate setting tomorrow, and while most economists are expecting the bank to lower rates by another 25 basis points, the market has recently become increasingly unsure about this assumption.
If the RBA does keep the cash rate on hold, it is likely to knock some of the wind out of our equity market.
However, tourism related companies are likely to weather any disappointment better than most because operating conditions are driven by the growing number of overseas visitors.
While it may be true that miners may also be in the same boat as their fortunes are tied largely to offshore factors, volatile commodity prices have made the sector unattractive to some.
There're plenty of signs pointing to the influx of tourists with the trend expected to continue. Sydney Airport Holdings Ltd (ASX: SYD) quarterly update is but one.
But finding stocks exposed to tourism and with lower correlation to interest rates is a challenge for our shallow market.
Sydney Airport should be an ideal candidate but it is an infrastructure stock that appeals to income investors looking for high dividends. Such stocks are often benchmarked against interest rates.
There's leisure facilities operator Ardent Leisure Group (ASX: AAD) but it's struggling to turnaround its gym business and a handover in leadership.
This arguably leaves hotel and resort operator Mantra Group Ltd (ASX: MTR) in the box seat and the profit guidance it delivered today is only reinforcing this view and has sent the shares surging 4.9% to a record high of $3.86.
The company said it has acquired Souls Surfers Paradise Resort after a competitive tender and is expecting 2014-15 earnings before interest, tax, depreciation and amortisation (EBITDA) and net profit to hit $71 million to $73 million and $35 million to $36.5 million, respectively.
The new forecast is ahead of Mantra's prospectus guidance of $69.5 million in EBITDA and $32.6 million in net profit.
The stock isn't cheap as it is on a current year price-earnings of about 29 times, but I believe this won't stop Mantra from enjoying further gains this month.
This is because May is the "confession season" where companies will have to confess if earnings are expected to vary by more than 15% from the previous year.
Those with more certain earnings growth prospects and who are well placed to benefit from any macro tailwinds will be in demand over the short term at least.
