Company Interview / Beating tech pressures with these three stocks

Key takeaways:

Expects RBA to lift interest rates by 25 basis points, with banks possibly benefitting but lending likely to slow Tech sector under pressure but Xero (ASX:XRO), WiseTech Global (ASX:WTC), and Life360 (ASX:360) seen as potential opportunities Watching Amazon (NASDAQ: AMZN) for AWS growth, advertising and e-commerce performance Positive on Alphabet (NASDAQ: GOOGL), highlighting search, Gemini AI and cloud momentum

David Walsh from Sarto Advisory shares views on the potential outcomes of the impending RBA rate decision, expecting a 25 basis point hike and suggesting markets have not fully priced this in. Walsh expects another rate rise later in the year and highlights that higher rates may support bank margins, but could also slow lending activity following recent robust data. He points to banks potentially benefiting, though notes current valuations are stretched.

Turning attention to the technology sector, Walsh states that growth stocks, especially within the ASX tech space, have faced considerable pressure due to perceived risks from AI and evolving business models. Companies such as Xero (ASX:XRO), WiseTech Global (ASX:WTC), and Life360 (ASX:360) are named as having significant downside already priced in. Walsh reports ongoing examination of these companies, drawing parallels to how resilient firms like ResMed (ASX:RMD) have responded to disruptive threats in the past. He awaits upcoming financial results for further clarity on sector health.

For US tech earnings, Walsh focuses on Amazon ($AMZN) and Alphabet ($GOOGL). He notes Amazon’s AWS division’s rapid growth and interest in its advertising and international segments, while expressing confidence in Alphabet’s search and cloud businesses, spotlighting Gemini AI and innovation in areas such as Waymo.