Broker tips on how to invest for the August ASX reporting season – Motley Fool Australia

Next month’s reporting season will be an inflection point for the S&P/ASX 200 Index (Index:^AXJO) and those looking for tips on how to best position for this event should read on.
For the first time since the COVID-19 outbreak, investors will get a chance to look under the hood of ASX shares.
The profit season will help determine the direction the market takes as the top 200 index remain stuck in a trading range.
ASX stock guidance will be rare
But if you are hoping for more clarity over the earnings outlook for the market, you might be disappointed. The ever-changing impact of the coronavirus pandemic will leave many ASX companies reluctant to stick their necks out.
In fact, the analysts at Macquarie Group Ltd(ASX: MQG) are only expecting half the normal number of ASX stocks to give guidance in August. Those that do might only quantify their outlook for specific variables and segments instead of for the whole business.
“We count 80% of the ASX 100 as providing forward looking comments before Covid19,” said the broker.
“During the peak of the pandemic, 38% of the ASX 100 withdrew their guidance, while another 18% reduced guidance.”
Guidance givers set to outperform
Here’s an interesting fact. Stocks that provided guidance outperformed those that didn’t through the COVID-19 bear market. This is true even for ASX stocks that cut their guidance during the pandemic.
“The worst performing stocks since the

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