With the market booming this year, many investors may be worried that they've missed out on the good times.
But the team at Macquarie Group Ltd (ASX: MQG) doesn't believe this is the case and remains bullish on the outlook for ASX shares.
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What is Macquarie saying?
In its latest portfolio update, the broker is "partying like it's 1999" and predicting that ASX shares continue to rise from here. It said:
We are taking a more constructive view. Yes, we're late. The ideal time to be more bullish was April, but we don't think we're too late. We now think the breadth of global easing plus solid global cyclical momentum will drive up growth expectations into 2026.
The broker's new leading indicator also suggests that the good times are here to stay. Macquarie explains:
Our new leading indicator is Macro Velocity. It's based on global rate cuts plus global economic momentum. We have used both before, but the combination is better. It sends a bullish signal on ex-US growth, supporting the 2025 narrative about the end of US exceptionalism. This is something we missed with our focus on Australia and the US.
While we focused on whether the RBA or Fed would cut, there has been net global easing since Dec 2023. In fact, the last time we had as many cuts outside a recession was after the Russian Debt Crisis and LTCM in 1998. This easing was amplified by a technology boom that supported sentiment – in the late 1990s it was the Internet, today's boom is AI.
Which ASX shares is the broker buying?
There are a number of ASX shares that Macquarie is tipping as buys. This now includes data centre operator Nextdc Ltd (ASX: NXT), uranium miner Paladin Energy Ltd (ASX: PDN), and job listings giant Seek Ltd (ASX: SEK).
They join the likes of Goodman Group (ASX: GMG), Megaport Ltd (ASX: MP1), and Xero Ltd (ASX: XRO) as its top picks, along with CSL Ltd (ASX: CSL), Lovisa Holdings Ltd (ASX: LOV), Web Travel Group Ltd (ASX: WEB), ResMed Inc. (ASX: RMD), Ramsay Health Care Ltd (ASX: RHC), and Challenger Ltd (ASX: CGF). The broker explains:
For tech/AI exposure, we add NXT, SEK and PDN to positions in XRO, MP1 and GMG. For more cyclicals, we add LOV and WEB from the Macquarie SMID-Cap Best Picks (Jul 2025). Stronger growth will likely limit the decline in bond yields, even if the Fed cuts more. For exposure, we add CGF, while reducing exposure to bond proxies (remove TCL, GPT) and stocks that benefit from lower yields (remove JHX).
Health remains our #1 overweight, but with a lower weight (reduce RMD, RHC). Staples also remains an overweight, but reduced (remove GNC). We made these changes to shift the portfolio more to cyclicals. The new portfolio beta is 1.07 (was 1.0).
