Buy Hold Sell: 2 standout ASX names for FY26

FY25 has been anything but dull. From sharp market pullbacks and the ripple effects of global trade tensions, to geopolitical flare-ups and wild swings in commodity prices - there’s been no shortage of drama. Yet, despite the volatility, markets have remained surprisingly resilient, with the ASX 200 now flirting with all-time highs.

So, what have investors learned? What caught them off guard? And more importantly, how should they be positioning for FY26?

In this episode, we’re taking stock of the past 12 months whilst also looking to the future. To help us unpack the biggest surprises, wins, and lessons from FY25 - and uncover where the smart money might be heading next - guest host Grady Wulff is joined by two of Australia’s sharpest market minds: Henry Jennings from Marcus Today and James Gerrish from Market Matters.

From their best (and worst) investment calls to the sectors they’re backing for FY26, the biggest risks still looming on the horizon, and a stock they are each backing for the year ahead - this is one episode you don’t want to miss.

Please note this episode was filmed on 18 June 2025.

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Edited Transcript

Grady Wulff: Hello and welcome to Livewire’s Buy Hold Sell. I'm Grady Wulff. FY25 really has had it all from Trump to tariffs to inflation to interest rate cuts, geopolitical tensions, even green shoots in the IPO space. But can this last into FY26? Well, it seems investors just continue to smile and send markets to record highs. To unpack all this, I'm joined by James Gerrish of Market Matters and Henry Jennings of Markets Today. Gentlemen, what has gone on in the markets in FY25? James, I'll start with you.

Biggest surprises of FY25

James Gerrish: It has been another interesting year and we're probably in the third year of very interesting trends that are playing out, all those things that you mentioned. I think from the investor standpoint, we're buying equities and trading equities every day. What surprised us in the market has probably been the extent to which those loved areas of the market continue to push higher. The extreme push into quality, valuations have stretched probably further than we expected and vice versa on the downside. So if I sit here now, that is creating what I think is interesting opportunities across the market. But yeah, that's probably been a huge surprise for me this year.

Grady Wulff: Henry, biggest surprise for you this year?

Henry Jennings: I think the biggest surprise has been the V-shaped recovery since Liberation Day. It turned on a dime and it just went ballistic. Now, I thought we would recover and we bought at the bottom-ish, close… or tried to. I thought it would recover, but I didn't think it would recover anywhere near like this. I didn't think two months later we'd be looking at all-time highs again in the index not only in Australia, but across Europe, across America as well. And I think the speed and the velocity of that move, it's taken a lot of people by surprise. I was expecting the bounce and then it sort of to go a bit sideways and drift down and wait for some clarity. Nah, just keep on trucking, keep on going. Commonwealth Bank, 180 bucks, yeah, let's do it.

Grady Wulff: Most expensive bank in the world, mind you.

Henry Jennings: Yeah. It is.

Best and worst calls of FY25

Grady Wulff: Now Henry, I'll stick with you. Best investment in the last 12 months and of course on the contrary, the worst.

Henry Jennings: I think my best has been buying into Zip. We were talking earlier; it was one of my picks for 2024. It has done well and what's been good is it keeps presenting opportunities as well. It was riding very high, it got to $3.50 or something and then got down to $1.05. The volatility has been extreme and now we're here, we are back up to $2.70. So it has been extreme in terms of the volatility, which is great. So from a trader's point of view, it's been really good and it's been backed up by fundamentals as well, in terms of the business and the cash flow and the growth - and especially the growth in America. So I think that's been certainly my best. I think my worst actually was the uranium space, which sounds odd.

Grady Wulff: That sounds very odd given what's happening right now.

Henry Jennings: It sounds very odd because I kind of went a bit early and then it collapsed. Absolutely got collapsed. And I kind of got a bit spooked out and cut my losses and then it has rallied extraordinarily and there was a couple of trigger points for that. One was Sprott buying in, increasing their stake in a bunch of our uranium stocks and it's just exploded, which is kind of weird because the spot price has done nothing. It's still 75 bucks a pound, so it is been kind of weird. So I feel like I've missed that big rally and that's been pretty annoying because I was there early and got spoofed out, and then-

Grady Wulff: FOMO hit.

Henry Jennings: FOMO. Definitely FOMO.

Grady Wulff: James, best and worst investment call over the last 12 months.

James Gerrish: Yeah, if I look at just the numbers from a portfolio contribution point of view, Catapult has been a good one for us. Sandfire is probably another one that's done well in the copper space and it's thrown up similar to what Henry suggested, multiple trading opportunities throughout the year. So when you compound those gains, it can work quite well. By far, MinRes has been our weakest call this year. That's weighed on returns for us. We're still there, but it has weighed on returns. And then the uranium space, absolutely. I've been a uranium bull for quite some time. That has weighed on our returns this year. We're still there. We've enjoyed the uptick and I think it will be a case where spot prices will ultimately move higher on the back of the Sprott vehicle raising a couple of hundred million to buy physical uranium. So that'll be the catalyst. They're not there yet, but they will be there, so that'll be the catalyst to turn that around. So yeah, some good, some bad…

Grady Wulff: And some ugly.

Henry Jennings: And some ugly.

James Gerrish: In 2025. Let's hope for more good in '26.

Overweight sectors for the year ahead

Grady Wulff: Now James, which sector are you overweight in heading into FY26?

James Gerrish: Resources would be the one that I'd call out here. It's been a bit of an unloved call and it's not all resources moving as one either. So we've maintained this bullish bias in some resources, uranium to our detriment this year, remain overweight there. Copper has been an area that we've backed and continue to back. So I think there's growing signs that the China economic situation is starting to improve. They've got their backs to the wall, but they've launched some very targeted stimulus, consumption led stimulus and I think that is starting to show early signs that it's working. So it's not just a China play. If you look over the next couple of years, there's a long runway of lower supply coming into the market, lower grades coming into the market from global producers. So to me, I think it stacks up for us to be in a pretty interesting area for commodities and you've got to think about from the price they are now. So we're all about picking what comes next, not just backing the winners that have done particularly well in a given year. So commodities would be mine.

Grady Wulff: Absolutely. Henry, which one are you overweight? Which sector are you overweight in heading into the new financial year and why?

Henry Jennings: I wish I'd have gone first. Or we’d actually talked beforehand because I was going to say resources as well because they have been underperforming. However, put that aside because James is probably right and taking aside BHP, RIO and Fortescue, which is iron ore, which kind of is bulk commodities I guess rather than the base metals, copper, gold, et cetera. The other area that I think is going to be good and has been good in the last few months unfortunately is defence, defence stocks, and we've got increased spending across the globe in terms of defence and that is only going to benefit the likes of Electro Optic Systems, which you couldn't give away at a $1.10, and now they're $2.90. And nothing's really changed apart from sentiment. DroneShield, they got down to 58 cents. I wrote in the newsletter, kill me if I try to buy DroneShield at 58 cents and now it's crazy.

Grady Wulff: Soaring.

Henry Jennings: And I think it's going to drop down. You've got Austal under pressure and under siege to some extent. You've got Elsight, which is in the drone space, talking communications. Codan, which gets a boost from gold and from defence, double whammy. So I think there's a lot more to play out in the defence sector going into the new year.

Grady Wulff: And there's a lot of stocks that play into it from both direct and indirect exposure in the defence space. So it's really interesting to see how it unfolds. Lessons, let's talk about it. What's a lesson that you're taking away for this year into next year?

Key lessons to carry forward

Henry Jennings: I think one of the key takeaways is just because it's gone up 10, 15% in a day or so or even a week, momentum can really carry it far higher than you think possible. Something like Boss or Deep Yellow, they've pretty much doubled in the last couple of months. It's insane. So I keep looking at it, looking at it and thinking, whoa, it's too expensive. I can't jump on board now. And that's a mistake because we've seen with this market, the way the market now trades, momentum is kind of king. The story is king until it stops. And once it stops it can go the other way just as quickly. But I think that's the thing, don't be afraid to jump on the moving train because the train speeds up and moves a lot longer and faster than trains in the steam age, when I was a young boy.

Grady Wulff: James, what about you? Talk to me about your key lesson or takeaway for this year that you're heading into next year with.

James Gerrish: I think what’s important, and I've learned that has been reinforced this year, is to keep an open mind. So it speaks to Henry's point around stocks running further than perhaps the fundamentals would suggest they should on both the up and downside. So, keeping an open mind and playing what's in front of you. So I think going into FY26 there's going to be a whole host of new macroeconomic challenges. I think there's going to be influences that we haven't thought of. Obviously what's playing out in the Middle East is front and centre at the moment. Market reaction hasn't been big at all at this stage, which it shows that probably the rally that has caught a lot of investors' still underweight equity.

So the aggressive nature of the rally from April has caught a lot of fund managers' underweight equities and they're reticent to sell equities I would imagine. But to me it's all about keeping an open mind, playing what's in front of you for the year ahead and not being afraid to back those things that haven't been working. So the momentum factor has been, as Henry pointed out again, has been a really influential factor in FY25. I would caution probably against what Henry is suggesting, that perhaps momentum won't be the game in 2026.

Biggest risk to markets

Grady Wulff: Okay, that's a big takeaway. Now, what is the biggest risk to markets in your opinion, heading into the new financial year? Of course it's hard to call that when it changes daily right now, but can you call one risk?

James Gerrish: There's plenty of risk, but if you all boil it down, it comes down to confidence in the US. So if the world loses confidence in the US, I think that's a reasonable risk. Obviously there's been some things that have played out in the last couple of months which would imply a loss of confidence. And I think the biggest way to see if whether it's playing out is through US bond markets. So US needs interest rates to stay relatively subdued. We saw it in Liberation Day. They really acted when bond markets started to become unruly. So the US bond market would be the key indicator to see that confidence hasn't been lost in the US.

Grady Wulff: Henry, biggest risk heading into the new year.

Henry Jennings: I think we all know what the biggest risk is, it's Donald Trump, who loves to be on the front page of the newspapers all the time. I think that is the biggest risk is his mercurial nature, the back and forth, the Taco man environment that we've seen. So I think that is clearly the biggest risk, that he changes his mind on a tweet and suddenly the world changes and spins on a dime and we've seen that, but maybe we're getting a little bit desensitised.

James Gerrish: Do you think that's the case?

Henry Jennings: Well, I think if you keep bashing someone over the head eventually they go, “You know what? I don't want it to stop because I'm kind of used to it by now”, and I think we are getting used to it. I think it came as a shock after inauguration and he came into power and then we had Liberation Day. But nothing that he's done is outside of what he said he was going to do.

Grady Wulff: Well, his bromance with Elon was not on my bingo card.

Henry Jennings: No, that was probably not on his bingo card, but he has done what he said he would do and he's there to change things up and his base likes that. But I think that still is the biggest risk. I think one of the other risks is, apart from what James has said, apart from the US debt, which is still the elephant in the room, I think there's still a concentration risk that we still plough into the same names, the passive ETFs, going into the same names. And we saw it when DeepSeek came out, that first time DeepSeek and the massive fall in Nvidia just on the back of that. And we've been desensitised to that because now we're getting more and more of these Chinese large language models coming out as well and we're going, “Oh yeah, it doesn't matter anymore”. Have you ever used DeepSeek?

Grady Wulff: No, I haven't.

Henry Jennings: It's a whole heap of fun.

Guest stock picks

Grady Wulff: Is it? Well, maybe that's my homework tonight. Now, I did ask both of our guests today to bring a stock that they expect will outperform in FY26. Henry, what did you bring for me?

Zip Co (ASX: ZIP)

Henry Jennings: This is a bit of repetition, to be honest. Zip is I think still going to do very well. Buy now, pay later is being legitimised. We've had regulatory moves in Australia and that has legitimised the big two – Afterpay and ZIP. Even coming in the studio, I got a little email from Afterpay because I have an Afterpay account, you've got to use these products if you're going to recommend them I fancy, and it said, "We are trusted and we are now under the new regulations. We've been doing this for years”. Same with Zip. America is the big opportunity and it's spilling down now. People aren't just buying things on buy now, pay later, clothes or whatever. They're buying groceries, they're paying bills because-

Grady Wulff: Restaurants are even offering it.

Henry Jennings: Restaurants. It's just becoming a way to pay, especially for a generation that eschews credit cards and especially for a generation that's under pressure on cost of living. So I think America's still cheap and I think they're going to continue to go up. They will be volatile. There will be moments, but I think you use those moments to keep your eye on the prize.

Grady Wulff: Henry bought Zip. James?

James Gerrish: Yeah, I actually agree with Henry and we own Zip and one of the things that's playing out in the US particularly is the growth is accelerating, but we're not seeing the growth in the negative side of that, which is the credit impairments and-

Grady Wulff: That is going down is something I noticed recently.

James Gerrish: It is. It speaks to a higher credit quality user, like Henry said.

Henry Jennings: I use Zip. I think it's great.

Grady Wulff: I haven't used any to be honest. I'm behind the times.

Paladin Energy (ASX: PDN)

James Gerrish: So I think that's a really important point. I'm going to go back and be a bit boring and talk about the uranium space. I think that is really set up for continual out performance. So Henry made reference to the Sprott Physical Uranium Trust, which is in the last couple of months or longer it's been trading below the NTA of its assets. So they haven't been able to raise money to buy pounds in the physical market. That ticked up above NTA. They were going to raise US$100 million. They raised US$200 million US. That gives them a lot of ammunition to buy pounds in the physical spot uranium market.

It's only a thin market. Most uranium is contracted pricing. So ultimately I think that will reinvigorate the spot market, which is a positive for sentiment in uranium and uranium equities will bounce. We own Cameco in our international strategy, which is at all-time highs, whereas Paladin and a lot of the Aussie names really struggled over the last 12 months or 18 months. So they've lagged that. So uranium in Aussie dollar terms, in Aussie listed equities would be my out performer for this year.

Grady Wulff: I hope you enjoyed that episode of Buy Hold Sell with James Gerrish and Henry Jennings as much as I did filming it. If you did, be sure to subscribe to our YouTube channel.