Bank of Ireland is among the top stock picks for 2002 in a list published today by top US broker JP Morgan.
JP Morgan unveiled its top stock picks for 2002 today in an equity market whose central themes it said would be disinflation and the corporate restructuring this will bring about.
Healthcare groups Eli Lilly, HCA, Mitsubishi Pharma, Novartis, Pfizer and Pharmacia all figure in the 34 selections from developed economies, along with consumer groups General Mills, Japan Tobacco and Nestlé.
Oil stocks BP, Phillips Petroleum and TotalFinaElf also feature, along with utility and home services group Centrica. Tech stocks are not left out entirely, with prominent inclusions including SAP and Sun Microsystems. Featured telecoms companies are Hutchison Whampoa and NTT.
Among the financial stocks, Bank of Ireland, HBOS and Société Générale are listed. The only automotive group to make the list is Toyota Motor.
Forecasting consumer price inflation at just 1.1 per cent next year, the broker said some sectors were better positioned than others to weather what it called the "disinflation storm."
Earnings disappointments would continue to dominate the corporate news, it said in its Global Strategy for 2002document as disinflation erodes pricing power from virtually every producer of goods and services.
In a climate of very low inflation or even disinflation, and with negative real interest rates in some countries, cyclicals were poised to come out on top, the broker said.
In an environment hostile to price increases, companies in a position to restructure by cutting jobs, closing inefficient capacity or greater outsourcing would also have a competitive advantage, JP Morgan said.
Additional reporting