With inflation lingering and the Federal Budget reshaping the case for income, professional investors are rotating back into value. ClearBridge, a US$200 billion global equity manager, has laid out exactly where it sees opportunity on the local market right now.
Figure 1: A digital stock board displaying live ASX market data and top gainers [Courtesy: Shutterstock]
The shift comes as several ASX picks fund managers are quietly accumulating start to show up across mining, energy and telecommunications. These are names built on resilient earnings rather than speculative growth stories.
What Is Driving the ASX Fund Manager Stock Picks Trend
ClearBridge head of Australian equities Reece Birtles said the Federal Budget has strengthened the case for income investing over relying on future capital gains. He argued this shift favours businesses that generate steady profits and distribute them to shareholders each year.
Franked dividends are becoming a more attractive path to returns for investors outside superannuation, according to Birtles. That backdrop is fuelling this year’s rebound in ASX stocks quietly accumulating by fund managers focused on value rather than momentum.
About ClearBridge
ClearBridge is an equity manager with about US$200 billion under management. The company focuses on value and income strategies. It tends to invest in firms that can keep earning profits over time. Its Australian equities division is led by Reece Birtles, who has become a prominent voice on where value remains on the ASX.
The manager’s approach centres on resilient earnings, strong balance sheets and pricing power. This is the same lens driving its current list of ASX picks, with fund managers accumulating across resources, telecommunications and energy.
Figure 2: ClearBridge Investments company logo [Courtesy: ClearBridge Investments]
Where Fund Managers Are Quietly Accumulating
Look closely at ClearBridge’s portfolio and a clear pattern takes shape. Every pick leans on durable earnings, pricing power, and a sector narrative still building momentum.
Telecommunications and Oligopoly Positions
Birtles pointed to Telstra (ASX: TLS) as a standout example of an Australian oligopoly well placed for the AI era. He also said AI may raise productivity in telecom by around 2 to 3 per cent each year.
Importantly, he noted these gains do not require major job losses. The focus instead sits on improving efficiency and cutting costs faster than revenue growth slows.
Mining and Resources Sector Picks
BHP (ASX: BHP) recently overtook Commonwealth Bank (ASX: CBA) as the most valuable company on the ASX. Birtles described the mining supercycle as well suited to income-focused investing, particularly through copper exposure.
He also flagged IGO Limited (ASX: IGO) for owning one of the highest grade hard rock lithium mines globally. Commodities tied to electrification and AI infrastructure remain a core theme in the mining sector for ClearBridge.
Energy and Fuel Security Stocks
Fuel supply chains have faced real strain in 2026, largely due to ongoing disruption near the Strait of Hormuz. Even so, ClearBridge has held firm on its positions in Ampol (ASX: ALD), Santos (ASX: STO), AGL Energy (ASX: AGL), Aurizon Holdings (ASX: AZJ) and Orica (ASX: ORI).
Birtles said these companies have shown pricing power in an energy sector that has arguably been underinvested for two decades. Rising demand is now benefiting these businesses materially, he added.
Fund managers accumulating ASX stocks are largely chasing this same theme:
- Earnings resilience through commodity and inflation cycles
- Strong balance sheets with limited refinancing risk
- Demonstrated pricing power during supply disruption
- Sustainable, franked dividend distributions
- Exposure to electrification and AI infrastructure demand
Winners and Losers Under AI Disruption
ClearBridge remains cautious on parts of the software sector despite the recent sell-off. Birtles said artificial intelligence is changing how the low capital model works. He pointed to the period over roughly the last 15 years, when many growth stocks were built on that approach.
Birtles named WiseTech (ASX: WTC) and Xero (ASX: XRO) as facing a shorter competitive runway ahead. As AI drives down the cost of launching new offerings, older software firms may lose pricing strength faster than expected.
Healthcare has fared differently. Birtles pointed to ResMed (ASX: RMD), trading around 16 times earnings while delivering double-digit earnings per share growth. He contrasted this with Commonwealth Bank, trading near 25 times earnings with limited growth on offer.
| Company | Sector | ClearBridge View |
|---|---|---|
| Telstra (ASX: TLS) | Telecommunications | Positioned to benefit from AI productivity gains |
| BHP (ASX: BHP) | Mining | Core income and copper exposure play |
| IGO Limited (ASX: IGO) | Mining | High-grade lithium exposure for electrification |
| Ampol, Santos, AGL, Aurizon, Orica | Energy | Fuel security and pricing power plays |
| ResMed (ASX: RMD) | Healthcare | Undervalued relative to earnings growth |
| WiseTech, Xero | Technology | Facing pricing power pressure from AI |
ASX 200 Market Snapshot
Broader trading on 07 Sep 2026 added useful context to these ASX fund manager stock picks. A lift from energy stocks pushed the ASX 200 up 0.06 per cent, or 5.4 points, to 9010.9, enough to absorb losses across the technology sector.
Just four of the eleven sectors closed the session in the green. Oil prices climbed after a fresh wave of tanker attacks near the Strait of Hormuz rattled markets. That move broadly lifted the energy sector.
| Company | Move on the Day |
|---|---|
| Woodside (ASX: WDS) | +1.6% |
| Santos (ASX: STO) | +1.7% |
| Viva Energy (ASX: VEA) | +0.7% |
| Karoon Energy (ASX: KAR) | +2.3% |
| Whitehaven Coal (ASX: WHC) | +7.0% |
| Yancoal (ASX: YAL) | +3.9% |
| New Hope (ASX: NHC) | +4.1% |
Industry Outlook: Value and Income Investing on the ASX
The mining sector remains a beneficiary of renewed demand related to electrification and AI infrastructure buildout. Miners’ dividend payments bounced back strongly in the first quarter after a weak finish to 2025.
Figure 3: A mining and quarry operation with excavation and processing machinery in progress [Courtesy: MiningTechnology]
Meanwhile, the energy sector is being supported by geopolitical risk premiums related to Middle East supply disruption. Analysts note that crude has not surrendered its full risk premium despite ongoing volatility.
Future Direction and Impact on ASX Portfolio Positioning
Impact on portfolio construction is likely to remain the central theme as value investing regains favour. ClearBridge expects franked dividends to become increasingly attractive for investors outside the superannuation system.
According to Birtles, opportunities will continue emerging in oligopolies, resources and fuel security stocks over the coming year. Investors watching ASX picks fund managers accumulating should track how energy sector volatility and mining dividends evolve through the remainder of 2026.
Software valuations may face continued pressure as AI reshapes competitive positioning. Healthcare names trading below earnings growth, such as ResMed, could remain a focus area for value-driven managers.
Colitco will continue tracking these ASX picks fund managers are quietly accumulating as the value rotation unfolds through 2026.
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FAQs
Q1. What are ASX picks fund managers accumulating right now?
Ans. ClearBridge is favouring value and income names across mining, telecommunications and energy, including Telstra, BHP and Santos.
Q2. Why are ASX stocks quietly accumulating by fund managers seen as attractive?
Ans. Budget changes and inflation are increasing the appeal of franked dividends over relying on future capital gains.
Q3. Which sectors are least favoured in this ASX fund manager stock picks trend?
Ans. ClearBridge remains cautious on parts of the software sector and consumer-facing stocks exposed to household budget pressure.
Q4. Why did the ASX 200 rise despite a technology sector sell-off?
Ans. Gains across energy and coal stocks, driven by rising oil prices, offset weakness in the technology sector.
Disclaimer
This article is meant only for informational purposes. If you are an investor who is watching ClearBridge’s ASX picks closely, all the data published in the content is sourced from ClearBridge commentary and external sources. Kindly verify all the information related to the share price and market data. Any investment should be made at the investor’s own risk. Colitco does not hold any position in the above-mentioned companies.
Elizabeth Jones is a finance and mining content specialist with over 10 years of experience creating clear, SEO-driven content across fintech, investing, banking, insurance, cryptocurrency, and resource markets. She transforms complex financial data and industry trends into engaging, reader-focused articles that improve understanding and audience engagement.
