5 Top Global Stocks to Buy in June
June 2, 2021
As we enter the middle of 2021, it has continued to be a good year for investors with the S&P 500 up around 13% so far this year.
However, for more tech-heavy growth names it has been a less fruitful year. Indeed, the tech-oriented Nasdaq-100 Index has trailed the S&P 500’s gains but is still up around 7%.
Meanwhile, Singapore’s stock market has bounced back given many of its biggest companies are considered “old economy” stocks.
Over in Hong Kong, the local Hang Seng Index is up around 7%. Despite all this, we should be focused on buying great businesses for the long haul. The short-term movements of the market shouldn’t concern us.
Instead, we should aim to have a mix of global stocks in our portfolio. With that, here are five global stocks you can consider adding to your portfolio in June.
The theme park and streaming giant operator Walt Disney Co (NYSE: DIS) looks certain to benefit from the reopening of the US economy as the population gets vaccinated at a rapid pace.
Meanwhile, its streaming service Disney+ is continuing to sign up new subscribers at an impressive clip as its total subscriber count to Disney+ totaled 103.6 million as of early April 2021.
Adding in its ESPN+ and Hulu services, which combined had 55.4 million subscribers, and Disney has a strong stable of streaming content that is captivating audiences.
The semiconductor giant Nvidia Corporation (NASDAQ: NVDA) continues to see robust demand for its state-of-the-art chips that power everything from cryptocurrency mining to top-tier gaming devices.
In its latest earnings release in late May, for the first quarter FY 2022, revenue surged 84% year-on-year to US$5.66 billion.
Meanwhile its net income rose 109% year-on-year to US$1.9 billion while operating cash flow saw a similarly impressive jump of 106% year-on-year to US$1.87 billion.
With demand for chips only set to grow, given the shortage worldwide, Nvidia will continue to benefit.
Having the biggest Singapore bank, DBS Holdings Ltd (SGX: D05), in your portfolio provides some ballast in case interest rates (or the US 10-year Treasury yield) rise faster-than-expected in the near future.
The latest earnings from DBS highlighted that it was emerging strong from the pandemic lockdown in 2020.
In its first quarter of 2021, DBS saw net profit cross S$2 billion for the first time as higher loan growth and increased fee income drove profits higher.
Its robust balance sheet and ample capital buffers, with CET-1 at 14.3%, mean that when the MAS-imposed dividend cap is lifted, DBS has the firepower to pay out more to shareholders.
Pinduoduo Inc (NASDAQ: PDD) continues to impress investors with stellar results and rapid growth in its top line.
While Pinduoduo is one of the newer powerhouse technology stocks to come out of China, it is no less impressive than the traditional titans.
In fact, it has revolutionised the e-commerce space in China by playing a key role in the emergence of “social commerce”.
With a market cap of only US$175 billion, compared to over US$600 billion for the giants of Tencent Holdings Ltd (SEHK: 700) and Alibaba Group Holding Ltd (NYSE: BABA) (SEHK: 9988), Pinduoduo has arguably more room to grow over the long term.
Finally, with Pinduoduo shares sitting about 30% off their all-time high, investors are getting an innovative Chinese tech firm at a discount.
5. Ping An Insurance
Anyone familiar with the Chinese insurance space will have heard of Ping An Insurance Group Co of China Ltd (SEHK: 2318).
The financial conglomerate has a range of services including insurance, banking, fintech and health tech. One of the main appeals of the company is its massive user base.
In the first quarter of 2021, Ping An saw its operating profit – a key metric for insurance firms – rise an impressive 8.9% to RMB 39.1 billion (US$6.1 billion).
This was driven by an improvement in its technology division, which houses many innovative subsidiaries.
With a dividend yield of just over 3% and with its stock down over 10% so far in 2021, this solid company could see a turnaround if China fully opens up following mass vaccination.
Diversifying amid uncertainty
With all the market “noise” of inflation and rising interest rates so far this year, it’s worth ensuring your portfolio can benefit whatever the market environment happens to be.
One way to do that is to buy great companies in sectors that will continue to perform well. Disney, Nvidia, DBS, Pinduoduo and Ping An Insurance offer that to long-term investors.
Disclaimer: ProsperUs Head of Content Tim Phillips owns shares in DBS Group Holdings Ltd and Ping An Insurance Group Co of China Ltd.
Tim, based in Singapore but from Hong Kong, caught the investing bug as a teenager and is a passionate advocate of responsible long-term investing as a great way to build wealth.
He has worked in various content roles at Schroders and the Motley Fool, with a focus on Asian stocks, but believes in buying great businesses – wherever they may be. He is also a certified SGX Academy Trainer.
In his spare time, Tim enjoys running after his two young sons, playing football and practicing yoga.