Is this the beginning of a market crash for ASX shares? Experts say fear not

These investing experts are seeing opportunities still.

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ASX shares have been riding a wave of optimism since rebounding from the COVID-19 market crash of 2020. Fortunately, the world is experiencing a global rollout of vaccines, and unemployment rates falling below 5%. This has been met with rising share prices.

However, the recent concerns stemming from the delta strain have brought concerns of another market crash to the front of investors’ minds.

Although volatility has increased in the stock market recently, some experts remain unfazed. Instead, these market participants are finding reasons to buy.

Recent market activity

One of the main worries for investors now is the rebound in coronavirus cases. Locally, New South Wales is enduring a prolonged lockdown with the latest strain proving difficult to manage.

The latest modelling by Melbourne University suggests a further 5.8 weeks of lockdowns will be required to reach a ‘safe level’ of a two-week average of five cases per day.

Economists and investors alike are fearing the impact the delta strain might have on global economic growth. This fear is evident from the 2.1% fall in the Dow Jones Industrial Average overnight, and the 1% drop in the S&P/ASX 200 Index (ASX: XJO) this morning. At the time of writing, however, the index has partially recovered to currently trade 0.41% lower for the day so far.

Experts who don’t see a market crash in the works

While the recent ASX 200 moves are negative, some well-respected analysts do not see it as a market crash in the making. Rather, they believe short-term pain presents buying opportunities.

When both US markets and ASX shares suffered short-term weakness in March, the CEO of Ark Invest, Cathie Wood, suggested the market was broadening out. This broadening of the market meant selling in some tech names to facilitate buying of more ‘value’ orientated companies.

More recently and locally, Burman Invest chief investment officer Julia Lee named 3 ASX shares that she considers buys ahead of earnings.

A couple of the thematics mentioned by Lee included the increased takeover activity and shares benefitting from higher lab testing.

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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