Here are FNB’s top stock picks to watch in 2022

As we enter 2022, investors are keeping a close eye on key themes that will shape the market dynamics throughout the year. Chantal Marx, Head of External Research and Content at FNB Wealth and Investments, shared her insights on the top stock picks to watch in the new year during an exclusive interview with CNBC Africa. The conversation delved into the broader themes that are likely to dominate discussions, sector specific opportunities, and potential pitfalls to avoid. Let's take a closer look at the key takeaways from the interview. One of the overarching themes that Marx highlighted is the ongoing impact of COVID-19 on the global economy. The focus will shift towards monitoring various variants and their severity, with the hope that the virus transitions from a pandemic to an endemic stage. Vaccination efforts, especially in less developed countries, will play a crucial role in achieving this transition. Additionally, inflation concerns are expected to linger in the first half of the year but could ease as longer-term factors come into play. The normalization of monetary policy and its implications on interest rates will also be closely watched. The supply chain disruptions are another factor that will influence inflation and commodity prices in the upcoming months. From a sectoral standpoint, Marx emphasized the importance of selecting stocks judiciously given the varying valuations in different segments of the market. While the US market appears expensive, opportunities for value can still be found. In the local market, mid-cap stocks present attractive prospects, with selected large-cap companies also offering potential growth. Marx highlighted Vodacom and MultiChoice as top picks for 2022, noting favorable developments and undervaluation in these companies. In the mid-cap space, companies like Long4Life and African Rainbow Capital stood out for their growth potential. During the interview, Marx also touched upon sectors to approach with caution in the year ahead. Food producers may face margin pressures due to rising input costs, although retail giants could provide some buffer. Platinum miners were flagged as an area of concern, with caution advised on new investments in the sector. Existing investors were advised to monitor the developments closely, as the outlook for the platinum price remains uncertain. As the conversation progressed, more viewers joined in to listen to Marx's insights, indicating a growing interest in navigating the stock market in 2022. The interview concluded with a discussion on telecom companies, with a focus on the potential for growth and strategic moves in the industry. The evolving market dynamics underscore the need for a balanced and informed approach to stock selection, considering both opportunities and risks in the current economic landscape. In summary, 2022 is poised to be a year of transition and adaptation for investors, with a renewed focus on key themes such as COVID-19, inflation, monetary policy normalization, and supply chain dynamics. Navigating these factors will require a keen eye for opportunity and a cautious approach to risk management. With strategic stock picks and a holistic investment strategy, investors can position themselves for success in the evolving market environment.