There's no doubt the conflict in Eastern Europe has triggered higher commodity prices, credit re-ratings, and jittery stock markets.
So much so that there's even been talk of a return to the 1970's style 'stagflation' where there's an economic recession and inflation at the same time, as Bloomberg speculated.
"A scenario analysis of 1973-1975 that saw prices soar and economies stall suggests commodities would hold out with sovereign bonds, the Swiss franc would surge 22%, the yen would slump with the Australian and New Zealand dollar," Bloomberg writers opined.
"Global equities would tumble 14%. The resilience of stocks after Russia's invasion of Ukraine will be put to [the] test as Federal Reserve Chair Jerome Powell said he is willing to act more aggressively to get ahead of inflation."
Analysts from investment bank Macquarie Group Ltd (ASX: MQG) are keen to take advantage of the trend and have opted to "position as if it's a commodity boom", as they stated in a recent note.
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Macquarie's portfolio changes
According to the note, Macquarie is positioning itself to capitalise on the rally across commodity markets. It's beefed up exposure to the sector through positions in South32 Ltd (ASX: S32), Newcrest Mining Ltd (ASX: NCM), lithium player Pilbara Minerals Ltd (ASX: PLS), and Northern Star Resources Ltd (ASX: NST).
Meanwhile, it trimmed down in QBE Ltd (ASX: QBE), Amcor Plc (ASX: AMC), Cochlear Ltd (ASX: COH), Aristocrat Leisure Ltd (ASX: ALL), and Ramsay Healthcare Ltd (ASX: RHC).
Other changes include reductions in Resmed Inc (ASX: RMD) and Janus Henderson Plc (ASX: JHG).
As is clear, Macquarie is positioned to benefit from the ever-soaring commodities sector that's been spurred on by a number of macroeconomic catalysts.
Analysts at Jefferies reckon the bank will benefit from the volatility in commodity and energy markets as well.
The broker recently updated its FY22 projections for Macquarie and also thinks recent weather events could inflect positively on these forecasts.
It values the Macquarie stock at $245 per share with a buy rating. That's alongside seven other brokers who're urging their clients to get a hold of Macquarie shares, according to Bloomberg data.
The consensus price target is $220.14 per share from this list.
In the last 12 months, the Macquarie share price has spiked 33% but has dipped into the red this year to date.
