2239 GMT - The impact of the conflict in Iran and disruption to energy supply is "primarily a timing and margin event, rather than a structural reset" for Australian industrial stocks, says Morgan Stanley. Earnings could come under pressure in the near term. Still, analyst Joseph Michael believes medium-term growth drivers are largely intact and investors will increasingly look through disruption in FY 2026. Its top picks are Orica, James Hardie, Qantas and Reece, assuming any disruption is short-lived. Prolonged disruption would like see most stocks trade lower. In that scenario, investors should rotate toward defensive stocks and companies with pricing power. "Qantas would drop in our order of preference in this scenario given higher fuel exposure and demand risk," MS says. (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires

March 22, 2026 18:39 ET (22:39 GMT)

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