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As 2018 rolls to an end, we thought it was time to take stock of the biggest winners, losers, dominant themes and trends over the course of the year, and what to expect in 2019.

Stockhead spoke with four analysts to pick their brains on the year that was.

What were the dominant trends or themes in 2018?

Scott Power, senior analyst, Morgans: “We saw a fair bit of M&A activity. Certainly in the health sector it was a big space for that. Early in the year we saw Sirtex Medical (ASX:SRX) and Viralytics (ASX:VLA) being acquired and more recently Healthscope (ASX:HSO) and the announced deal whereby Sigma (ASX:SIG) would be acquired by API (ASX:API).

“We also had a number of companies doing trial result readouts this year, to varying degrees of success. The rise of immunoncology and e-health was also a big factor.”

Martin Duriska, analyst, Canary Capital: “It was a very different start to the year compared with the finish. One of the biggest things we saw towards the end of last year was bitcoin and crypto being all the rage, it peaked in November. And we saw at the start of this year very much the leftovers of that, people were still believing it was a hot sector, not believing it was a bubble. And you had a lot of companies jumping on the bandwagon and announcing their move into the space, much like what happened with medicinal cannabis.

“But then things cooled off and the announcements made less and less of an impact.”

Kevin O’Hara, CIO, Tulla Private Equity: “Certainly marijuana held up very well, medicinal cannabis has done very well with a lot of the larger stocks in that space holding their weight.

“Technology took a bit of a beating in the last six months with the NASDAQ coming off and liquidity drying up here hurting the micro and small cap markets.”

Lee LaFrate, chairman, Armytage Private: “You can split the year in two. The first half was steady as she goes, earnings season was with expectations, no shocks. Everything was tracking along nicely until September when it all turned to poo thanks to that idiot in America. He basically turned capital markets on their heads in one foul swoop.

“I’ve been in the game for 35 years and I’ve never seen geopolitical issues driving the market quite like they are now. And that constant noise out of Washington has flattened equity and capital markets and destroyed investor confidence.”

What can investors expect in 2019?

SP: “When you’re looking for stocking fillers you want to look at companies with near-term catalysts for share price movement. Volpara (ASX:VHT) and Rhinomed (ASX:RNO) are two that we think are about 12 months away from breakeven, which could send them on a real run.

“The market is interested in two things in the health and biotech sector. One is clinical programs, so companies that are progressing their products through clinical trials, and two is commercial milestones.

“It is going to be an interesting year, with all the market uncertainty and volatility hurting economies all around the world. Healthcare tends to be more defensive but with the stabilisation of the market we may see things come back into focus pretty quickly.”

MD: “I think we aren’t going to have a frenzy given the market conditions but I expect the upside will continue for biotechs if they are able to get devices through approvals or sign commercialisation deals. Gold stocks should recover after an underwhelming year.

“I think the two areas with good potential are drone stocks and cybersecurity stocks. The catalyst for drones will be regulatory approval to use them in populated areas, I see much more upside on the manufacturing and commercial side of drones rather than the anti-drone, defence side of things. And we are going to see more and more stories about cybersecurity attacks and so there will be stocks that will benefit from that.”

KOH: “I think anything that’s in medicinal cannabis or automation, artificial intelligence and blockchain, is moving in the right direction, particularly thanks to the maturation of those markets. Governments and regulators are starting to understand these things and so they are starting to become more accepted and properly regulated.

LL: “Looking into 2019 I can’t see any brightness, it’s going to be a horrible year with all the noise that’s coming out of the States by that one buffoon. That will continue to impact markets across the globe heavily.

“In the small and micro cap markets there is virtually no liquidity, we have some good individual businesses that are performing well but the illiquidity issue will not go away.

“We’ve also got a NSW and federal election coming up, so that uncertainty of what we are going to get with Bill [Shorten] will have an impact too.

“I think we will see a substantial increase in M&A activity and a lot of these lost sort of stories in small cap land could be takeover targets.

“But there aren’t going to be any free kicks in the goal square next year.”