It looks like Australian sharemarkets are finally rebounding after a choppy start to the year.
At the time of writing on Tuesday, both the S&P/ASX 200 Index (ASX: XJO) and the S&P/ASX All Ordinaries Index (ASX: XAO) are up just over 1% for the day so far.
When markets are rising, investors often jump on board with familiar large-cap household names like Telstra Group Ltd (ASX: TLS), BHP Group Ltd (ASX: BHP), or even CSL Ltd (ASX: CSL) in the hope of benefiting from a rally.
Here's what brokers expect from these three well-known ASX shares next.
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Hold Telstra shares
Telstra shares are trading around 0.5% higher in Tuesday lunchtime trade, at $5.05 a piece. For the year to date, the shares are up around 4%; however, they're 9% lower than a 10-year high that the telco stock recorded in mid-May.
It looks like much of the shift in sentiment was investors taking their gains off the table after a huge rally. But the downturn accelerated when a flurry of brokers updated their outlooks on the stock.
A broad softening in defensive shares, including telcos, and valuation concerns have also acted as headwinds. Telstra is a classically defensive stock, which means it benefited from a flight to security earlier this year when geopolitical volatility made many other sectors look too risky.
Market Index data shows brokers are divided between a hold and a buy rating. The $5.17 average target price implies around a 3% upside, at the time of writing.
Hold BHP shares
The ASX mining giant's shares have tumbled into the red in Tuesday lunchtime trade. At the time of writing, the shares are down around 1% and changing hands at $60.34 a piece. The decline hasn't made much of a dent in the miner's huge gains so far this year, though. For the year to date, the shares are up around 32%.
The mining heavyweight's shares have been supported by renewed investor appetite for mining stocks over the past month. After a period of weakness driven by concerns around geopolitical uncertainty and commodity demand, investors have started to rotate back into diversified miners.
In mid-July, the miner posted an operational update. It announced record iron ore production over the year to the end of June, up 1% to 264.7 million tonnes. Copper, however, was 3% lower than the previous year at 1.95 million tonnes.
The company also announced that, while it has several growth projects underway, BHP is guiding to lower copper output this year, with a forecast of 1,650,000 to 1,800,000 tonnes. Iron ore is expected to stay largely flat at 260 to 272 million tonnes.
It looks like brokers now consider the shares as trading around fair value.
Market Index data shows the majority of brokers have a hold rating on BHP shares. The average $59.81 target price implies a potential 4% upside, at the time of writing.
Hold CSL shares
CSL shares are trading in the green on Tuesday afternoon. At the time of writing, the shares are up around 2.5% to $127.16 a piece. CSL shares have been thrust into the limelight this past year after suffering a consistent downturn in its share price. Despite today's uptick, the ASX biotech company's shares are still down 26% for the year to date and are 52% lower than this time last year.
In May, CSL announced FY26 revenue guidance of around US$15.2 billion and NPAT of around US$3.1 billion. Both of these figures were below market expectations. The company also flagged expectations of another US$5 billion of non-cash impairments across FY26 and FY27.
Investors haven't been impressed, and it looks like analyst sentiment has now shifted, too. Earlier this year, brokers were optimistic that the share price could rebound strongly, but they've now changed their tune.
Market Index data shows that the majority of brokers now have a hold rating on CSL shares. The $128.93 average target price implies a potential 1% upside at the time of writing.
