Crispin Murray: Where to find ASX opportunities amid ‘theme-driven’ market noise

Tariffs, trade and AI are the big stories driving markets. But with investors increasingly focused on global themes, opportunities are emerging at home on the ASX, says CRISPIN MURRAY

• Markets are increasingly theme-driven
• Opportunities emerging on ASX
• Find out about Pendal Focus Australian Share fund

NARRATIVE-DRIVEN volatility is causing market dislocation, rewarding investors that can stay focused on business fundamentals, says Pendal’s head of equities Crispin Murray.

Share prices are increasingly moved by popular themes like AI disruption, trade wars, and tariff fears – without regard to company fundamentals or long-term valuations.

As a result, quality Australian companies with sound outlooks and predictable cash flows are being indiscriminately sold off, creating opportunities for fund managers.

“A lot of it is driven by flow, particularly out of the US. Worried about tariffs? Sell the tariff basket. Think interest rates are going down? Buy the discretionary basket,” says Murray, speaking at Morningstar’s 2025 Investment Conference in Sydney this week.

“We believe this is creating more distortions in the market. It means that the amplitude of mispricing is greater, and it lasts longer.

“The challenge for fund managers is to take advantage of that – it actually creates more opportunity.”

Tariffs part of a larger picture

Murray says tariffs are just one part of a broader US policy push that also includes deregulation, lower taxes, and efforts to drive down energy costs – all of which are supportive for global growth.

“I think we need to step back and think about why are the tariffs happening? The tariffs are one pillar in a strategy which is all about trying to change the world trading order.”

Pendal Focus Australian Share Fund

Now rated at the highest level by Lonsec, Morningstar and Zenith

Read more

He says there is logic behind the need for change because America cannot continue borrowing money indefinitely to fund consumption.

“It is unsustainable – and therefore they need to change it.”

Alongside tariffs are plans to reduce red tape, reduce taxation and lower the costs of energy.

“What they’re trying to do is make America the place people want to invest, not be forced to invest.

“The problem we had until maybe two weeks ago was that everyone just saw the stick, not the carrot.

“Now, they’re beginning to think ‘they don’t want a recession, they’re going to do this in a more managed way’.

“It will be choppy, it’s going to be unpredictable – but I still feel that underlying all of that, we’re going to have a reasonable growth in the global economy.”

Predictable cashflow

Murray says global market dislocation means the ASX has a range of industrial companies with predictable cash flows and returns that have been sold down and offer opportunities for investors.

“One example is CSL – one of Australia’s largest, most successful companies. Five years ago was running high – at an over 40 multiple. It’s now down to about 22 times earnings,” he says.

Not all the decline is global factors. CSL has seen reduced margins as the pandemic hurt the company’s core plasma collection business and overpaid to buy Vifor Pharma. But the looming threat of tariffs on its pharmaceutical business has dampened investor sentiment.

“The company has actually been able to grow earnings over five years by about 40 per cent – but the rating has halved and therefore the share price has gone backwards.

“When it comes to investing you make money from anticipating change, and our bet is that the failures of the last five years have finally permeated into the psyche of the company. They realise that they need to improve.”

Murray says fears of tariffs affecting CSL is “assuming the company doesn’t do anything to respond – and I think that’s where the market’s overreacting.

“Companies can realign where they produce things. They can do that within two or three years.

“And so, we think the risk on the tariff front is being overstated, and that’s what’s providing you the opportunity.”

About Crispin Murray and the Pendal Focus Australian Share Fund

Crispin Murray is Pendal’s Head of Equities. He has more than 27 years of investment experience and leads one of the largest equities teams in Australia. Crispin’s Pendal Focus Australian Share Fund has beaten the benchmark in 12 years of its 16-year history (after fees), across a range of market conditions.

Pendal is a global investment management business focused on delivering superior investment returns for our clients through active management. 

Find out more about Pendal Focus Australian Share Fund  

Contact a Pendal key account manager