Caroline Ritchie: Market themes worth a look

Investors need to consider some major market themes at this point in the investment and economic cycles, and these are:
Leverage the US recovery
Recent data on manufacturing, international trade and consumer spending indicates United States growth continues to accelerate. A pick-up in service industries, the mainstay of the US economic condition, is building steam.
There is no doubt pressure points will persist for some time - unemployment, regulatory and fiscal uncertainty, the housing market and consumer spending. So policymakers will retain hugely stimulatory policies, including the cash rate effectively at zero and the US$600 billion bond-buying programme, to underpin progress.
Key large-cap shares with big US-based operations that might stand to benefit from this pick-up include ... (Call to discover more).
Commodity supply/demand imbalance
In 2010 commodity performance was largely a supply story. Extreme weather caused severe production losses across agriculture, and natural disasters mixed with a lack of infrastructure investment during the financial crisis constrained supply in metals and bulks.
This year we expect significant knock-on effects from last year's supply constraints. Capital expenditure by producers across the commodity spectrum is rising fast. Global mining spend is expected to hit a record this year but the effect of this on supply will take time.
We expect global demand for oil to surpass pre-recession highs in the near term. Middle East producers are also likely to be keen to ensure oil revenues remain high to help evade social unrest.
With the global economy tipped to grow at 3.4 per cent this year, demand for metals and oil should be more than enough to beat supply.
Key commodities that will see price rises from these supply/demand imbalances include coal, copper, iron ore and oil.
As for precious metals, inflationary pressures stemming from easy monetary policy and quantitative easing programmes should limit the downside risks for precious metal prices in 2011.
Key large cap shares that are likely to benefit from this theme include ... (Call to discover more).
Dividends come in handy
Since 2000, dividends have delivered nearly two-thirds of the Australian market's total return. With a modest index target for 2011 of 5000 points, high-yielding shares are likely to be an important part of portfolios. Since the financial crisis we believe dividend payments have rebased at more sustainable levels. The reasons for this include lower payout ratios, more conservative balance sheets (lower debt levels) and less chance of acquisitive activity by companies just for the sake of gathering assets.
Key large cap shares that we prefer which pay attractive dividends, include ... (Are you reaching for the phone yet?)
Caroline Ritchie is an NZX adviser for Forsyth Barr in Napier and holds an NZX Diploma, BCom and BSc. For sharemarket advice contact her on (06) 835 3111 or caroline.ritchie@forbar.co.nz.
The comments in this note are for general information purposes only. This article is not intended to constitute investment advice under the Securities Markets Act 1988. If you wish to receive specific investment advice, please contact your investment adviser. Disclosure statements for Forsyth Barr and any of its investment advisers are available free on request.