Insights

Can the ASX 200 hit 8,000 points by the end of the year?

One professional investor believes the milestone is achievable in 2021…
The post Can the ASX 200 hit 8,000 points by the end of the year? appeared first on The Motley Fool Australia. –

When the S&P/ASX 200 Index (ASX: XJO) hit 7,000 points for the first time ever back in January 2020, it caused quite a stir.

Although an arbitrary threshold like 7,000 points has very little real application or value, it still provides an easy rally point for investors’ psychology. A similar, although perhaps not quite as large, a stir also happened when the ASX 200 once again finally found 7,000 points back in April.

Following this, the ASX 200 then breached 7,100 points, followed by 7,200 and 7,300, followed finally by 7,400 points over the past few months.

How much higher can it go? That might be what many an investor is asking. Well, one fund manager thinks the runway isn’t ending soon. According to a report in the Australian Financial Review (AFR) today, global investment manager Research Affiliates is expecting the ASX 200 to push past 8,000 points by the end of the year, and outperform other global markets to boot.

The source of this optimism? Commodity prices. Here’s some of what Mike Aked, director of research at Research Affiliates, had to say:

We would expect that Australian resource companies are much more likely to drive our local market higher over the second half … possibly rising to as high as 8000 given the momentum in commodity prices… Resource companies are well positioned to take this lead as news of domestic and global inflation should continue to rattle markets until the end of 2021.

Miners to push ASX 200 above 8,000 points?

Commodity prices are indeed at record levels. Iron ore is still stubborn above the sky-high US$200 a tonne mark, despite various predictions of a return to ‘normal’ levels.

Oil is back above US$70 a barrel, and copper prices are also at historical highs. This has pushed the ASX 200’s big miners such as BHP Group Ltd (ASX: BHP) to new highs in recent months. 

Even gold is remaining resolutely above US$1,700 an ounce. Sure, that’s still not at the highs above US$2,000 an ounce that we saw last year. However, it’s still very high relative to its (long) history.

Aked is also looking to ASX 200 resources shares as a hedge against the possibility of future inflation, a bugbear for ASX investors. Here’s some of what he had to say on that topic:

While we do not know what the remainder of 2021 will bring, investing in a portfolio of cheap resource names that are positioned well for rising inflation seems a more robust investment strategy than investing in expensive financials, which will need continued property price increases to justify their price.

There you go, out with the banks, in with the miners, at least according to Aked. Eight thousand points by the end of the year (or a 9% rise from today’s levels)… it’s a bold claim. But most ASX investors would probably be pretty happy if it turns out to be right.

The post Can the ASX 200 hit 8,000 points by the end of the year? appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Here are 3 of the ASX 200’s most heavily traded shares today

ASX 200 rises, Macquarie up, Rural Funds launches capital raising

Mining shares in the ASX 200 might unearth US$26b worth of dividends

The BHP Group share price is rising again — so where to from here?

The 5 best performing ASX healthcare shares of FY21, did yours make the cut?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!