Between the Bells: Recent Episodes
Bell Direct
Tune in to the Bell Direct 'Between the Bells' podcast, where we'll cover the latest economic news and updates, market movements and analysis. With daily updates, you can get the information you need to make sure that you're better off.
Last week's trading was driven by a handful of key developments - renewed tension in the Middle East and the kickoff of US earnings season chief among them. Today, Max Lo Certo is joined by Bell Potter Lead Strategist Rob Crookston to break down the standout themes from results so far, unpack the disappointing showing from Tesla and Alphabet, and examine the broader economic data set to influence local trading in the weeks ahead.
In this week’s video, Max and Rob cover:
- A review of last week on the market
- Factors shaping earnings season in the US
- Is this the end of Mag 7 dominance?
- Macro data to watch
- Bell Potter’s sector of the week
Markets were mixed last week, with the US and Europe rising while Japan, emerging markets, and the ASX slipped. This week, Max Lo Certo speaks with Bell Potter's Lead Strategist Rob Crookston to examine the key forces shaping recent market movements and their implications for investors.
In this week’s video, Rob and Max cover:
· what drove markets last week
· the Fed’s hawkish pivot: should investors be worried?
· macro data to watch
· Bell Potter’s stock of the week.
This week's markets were shaped by a tug-of-war between Middle East tensions and Trump-led de-escalation, leaving US equities broadly flat but the ASX finishing the week stronger. Domestically, the picture was mixed - bank stocks came under further pressure from property tax concerns and weak housing data, while selective buying emerged in consumer discretionary and healthcare names. With the SpaceX IPO dominating global headlines and the RBA's next move looming, it was a week where the headlines moved faster than the index.
In this week's video, Will and Sophia cover:
- continuing Middle East tensions
- the over and underperforming sectors on the ASX last week
- private equity's acquisition of Steadfast and what it signals for AI disruption fears
- SpaceX's record-breaking IPO
- the outlook for next week’s pivotal RBA meeting.
The ASX saw a strong week this week, bouncing over 1% and outpacing global equities. Today, Sophia Mavridis sits down with Bell Financial Group’s CIO Will Riggall to unpack the macroeconomic factors that moved the markets recently, the surging materials sector and which stocks Bell Potter’s team are looking at in this space, and their thoughts on SpaceX’s upcoming blockbuster IPO.
In this week’s video, Sophia and Will cover:
- Inflation, oil, and earnings: the factors moving the market
- why the materials sector is outperforming the broader market
- Bell Potter’s stock picks in the materials sector
- the upcoming SpaceX IPO.
Bell Potter’s Lead Strategist Rob Crookston talks what’s driving markets right now in this week’s wrap. The bond markets lead the way while equities followed this week, while economic news is back in focus.
In this week’s wrap, Rob and Sophia cover:
- (0:17): what happened in market’s this week
- (3:38): what the labour market and PMI data means for the RBA
- (5:23): Bell Potter’s stock picks this week
- (10:00): what’s on the radar in the week ahead?
- (10:44): how are Bell Potter positioned for the week ahead?
: Markets were pulled in two directions this week as Australia’s federal budget weighed on banks and property-linked stocks, while strong US earnings and booming AI demand pushed global markets higher. In this week’s interview, Bell Financial Group CIO Will Riggall sits down with Bell Potter Lead Strategist Rob Crookston to unpack the key budget changes, the strength behind the AI rally, and where investors may find opportunities across commodities, defensives and global equities heading into FY26.
In this week’s video, Will and Rob cover:
- The federal budget changes and the impact on investors
- the market shift toward income and defensive sectors
- strong US earnings and continued AI momentum
- commodity strength led by copper and BHP
- the outlook for banks, CSL and FY26 opportunities.
In this episode of From the Helm, Solstice Minerals Managing Director and CEO Nick Castleden joins us to discuss the company’s exploration progress and the growing momentum behind its flagship Nanadie copper-gold project.
Nick provides an overview of Solstice Minerals’ strategy and recent commercial developments, explaining the significance of exploration results at Nanadie and what has driven strong market interest in the stock this year. He also discusses the company’s recent acquisition, drilling milestones, upcoming catalysts, and how Solstice is positioned to accelerate its growth strategy.
In this interview, Nick covers:
- an introduction to Solstice Minerals and its broader exploration strategy
- what has driven the company’s strong share price performance following exploration success at Nanadie
- background on the Nanadie asset and the rationale behind its recent acquisition
- expected news flow cadence and key updates investors can anticipate in coming months
- additional work required ahead of a potential Mineral Resource Estimate (MRE) upgrade
- the company’s strong cash position and flexibility to accelerate drilling activity if results continue to validate scale
- the key catalysts investors should be watching over the next 12 months.
Note: This interview was filmed on 10 May 2026.
We saw another week of major moves on the market last week, as continuing volatility in oil prices and the RBA’s 25 basis point rate increase dominated the headlines. Today, Sophia Mavridis was joined by Bell Financial Group’s CIO Will Riggall to unpack how investors reacted to the rate increase, which sectors have been over and underperforming lately, and where Bell Potter’s analysts see opportunities in the current market landscape.
In this episode, Sophia and Will cover:
- the macroeconomic factors impacting domestic and international markets last week
- the RBA’s rate increase and how the ASX responded
- the best and worst performing sectors recently
- ongoing oil price volatility and how the Australian economy has bounced back
- Bell Potter’s stocks to watch and analyst ratings
Strong earnings and a resilient US economy are pushing Wall Street higher, with Meta and Alphabet leading a massive week of mega-cap reporting. It’s a different story in Australia, as local sectors dipped in April as investors trade cautiously amid rising interest rates and persistent inflation signals.
In this week’s wrap, Will and Sophia cover:
- how the key asset classes performed this month
- US earnings results from Meta, Alphabet, Google, and Caterpillar
- the share price decline across Australia’s major supermarkets
- the key highlights from Bell Potter’s research
- the demand and supply shift in the lithium sector
- what to expect from the RBA next week.
Market volatility is back on the radar this week as geopolitical tensions drive oil prices higher and keep global investors on edge. While the Wall Street had a strong month driven by the AI sector, the local market is facing a more challenging period, headlined by downgrades across the banks and by the biggest story this week in Cochlear’s (ASX:COH) over 40% decline.
In this week's wrap, Sophia and Will cover:
- the impact of rising crude oil prices and stalled peace talks on global investor sentiment
- why the ASX is lagging behind the AI-driven rally seen in US markets
- a look at the recent performance of the energy and financial sectors in Australia
- Cochlear's (ASX:COH) 40% tumble what it means for long-term shareholders.
In this week’s Weekly Wrap, CIO Will Riggall is joined by Bell Potter’s Lead Strategist Rob Crookston to unpack the key drivers behind the recent market rally and what comes next.
Despite ongoing geopolitical uncertainty and rising oil prices, the S&P 500 has surged back to all-time highs, led by a strong rebound in the tech sector. But the big question remains: how sustainable is this move?
In this week’s video, Will and Rob cover:
- The rapid market rally and whether current momentum can continue
- What to expect from upcoming trading updates and the impact of rising oil costs on companies like Qantas
- The shift in momentum away from large-cap banks such as Westpac and back toward high-growth tech
- Bell Potter’s preferred positioning—focusing on offensive, capital-light sectors including tech, diversified financials, and classifieds.
In this episode of From the helm, Sophia Mavridis is joined by Centaurus Metals (ASX:CTM) CEO & MD Darren Gordon to discuss what sets their product apart from its peers and what is next for the broader nickel market.
In this episode of From the helm, Sophia Mavridis sits down with Oneview Healthcare (ASX:ONE) CEO James Fitter to unpack their unique end-to-end patient monitoring technology, the impact of AI emergence on their business and what’s to come looking ahead to 2026.
In this episode of From the Helm, John Konstantopoulos, CEO & Co-Founder of Artrya Limited (ASX:AYA), joins us to discuss the company’s AI-powered approach to transforming cardiac diagnostics and improving patient outcomes.
John provides an overview of Artrya’s strategy and commercial progress, explaining how its software platform leverages artificial intelligence to assist clinicians in detecting coronary artery disease earlier and more accurately. He also highlights the differentiation of Artrya’s Salix product suite, recent milestones, and what lies ahead as the company scales globally.
In this interview, John covers:
• introduction to Artrya, its strategy and commercial progress
• how the platform works and uses AI to support better cardiac outcomes
• key differentiators of the Salix product portfolio
• what investors can expect over the next 12 months
• the SAPPHIRE study, participating US hospital groups and intended outcomes
• the size of the addressable market opportunity
• key catalysts behind the company’s recent market cap growth
Note: This interview was filmed on 25 March 2026.
In this episode of From the helm, Titomic (ASX:TTT) CFO Geoff Hollis joins us for a deep dive into their proprietary technology for the manufacture of metal parts, including how it differentiates from other products in the market and what is on the horizon looking ahead.
In this episode of From the Helm, Arnie Selvarajah, Group Co-CEO of Bell Financial Group (ASX:BFG), joins us to discuss the company’s evolution into a more diversified and holistic wealth manager.
Arnie unpacks the strategic shift beyond traditional stockbroking, outlining how Bell Financial Group is positioning itself for long-term growth through expanded wealth management capabilities, technology investment, and a broader client offering spanning self-directed and advised investors.
He also shares insights into the group’s competitive advantages, progress against its transformation strategy, and what this means for financial performance and future growth.
In this interview, Arnie covers:
• the strategic shift toward a more diversified, holistic wealth management model
• what expanding beyond stockbroking means for BFG’s future
• BFG’s competitive advantages in an evolving wealth landscape
• progress and milestones achieved in the transformation journey
• the role of technology in scaling across self-directed and advised channels
• impact of the transformation on financial performance and 2025 results
• why BFG presents a compelling investment opportunity
• key priorities and what investors should watch for in 2026.
Note: This interview was filmed on 25 March 2026.
With countries across the world committing more spend to their military, gaining exposure to the defence sector has increasingly become a key strategy for investors. As the escalating US-Iran conflict has been making headlines, this sector has taken centre stage, with defence stocks a rare standout in the turbulent market.
Today, Bell Financial Group CIO Will Riggall is joined by Global X Senior Investment Strategist Billy Leung, as they unpack the current landscape.
Together, they discuss the drivers behind the defence industry, and explore how investors can gain targeted exposure to this critical sector.
Note: This interview was filmed on Thursday 26 March.
In today’s Weekly Wrap episode, Will Riggall and Sophia Mavridis chat about the key insights heard at the ASX SMIDcaps conference this week, proudly sponsored by Bell Financial Group.
Our CIO Will Riggall and Lead Strategist Rob Crookston provided a keynote presentation and a range of CEOs spoke about the opportunities in some of the ASX’s up and coming stocks.
Hear about Will’s macroeconomic outlook in the face of the ongoing Middle East conflict as well as high quality opportunities within the small-cap space, which are positioned to continue growing independent of the global economic turbulence.
In this week’s video, Sophia and Will cover:
- (0:55): the 12 month outlook for both global and Australian equities
- (6:01): the biggest macroeconomic risks and opportunities for our market
- (7:54): Bell Potter’s high conviction growth strategies in the current conditions.
In this episode of From the Helm, Grady is joined by Clarity Pharmaceuticals (ASX:CU6) Executive Chairperson Alan Taylor & Bell Potter Senior Analyst John Hester, for a deep dive into their next-generation radiopharmaceutical technology for both early-stage cancer diagnosis and treatment.
In this episode of From the Helm, Grady sits down with Neuren Pharmaceuticals (ASX:NEU) CEO Jon Pilcher, to recap on their major developments over the last 12 months in the US market, their guidance looking ahead for next financial year, and the company’s healthy cash balance.
In this episode of From the Helm, Grady chats with Alterity Therapeutics (ASX:ATH) CEO David Stamler, to discuss their neurodegenerative disorder treatment specifically targeting Multiple System Atrophy (MSA), a rare and aggressive disease affecting involuntary functions and motor control.
In this episode of From the Helm, Grady is joined by Amplia Therapeutics (ASX:ATX) CEO & MD Dr Christopher Burns & Bell Potter Analyst Thomas Wakim to unpack the ongoing clinical trials for their prospective treatment drug for pancreatic cancer, and its substantial market opportunities in the US.
In this episode of From the Helm, Grady sits down with Summerset Group Holdings (ASX:SNZ) CFO Margaret Warrington to unpack their end-to-end business model for aged care sites, from land acquisition all the way through to building and operating the centres.
In this episode of From the Helm, Grady chats with Saluda Medical (ASX:SM1) President and CEO Barry Regan to discuss their recent developments since their IPO in November, their developmental drug for the treatment of chronic pain, and what is on the horizon looking ahead.
In this episode of From the Helm, Grady sits down with EBR Systems (ASX:EBR) President and CEO John McCutcheon, to discuss their innovative, one-of-a-kind implant treatment for heart failure patients, the pathway to widespread adoption, and scaling plans for future growth.
In this episode of From the Helm, Grady sits down with Mesoblast Director Silviu Itescu, to unpack the recent approval and launch of their Ryoncil drug for children, their outlook for the next 12 months in capturing the adult market, and their extensive pipeline of further products.
In this episode of From the helm, Grady chats with 4D Medical (ASX:4DX) Founder and CEO Andreas Fouras to reflect on the meteoric rise of their lung imaging technology and detail their future plans for further global expansion.
While global markets remain focused on the latest central bank moves, rising energy prices and geopolitical shifts are adding a new layer of complexity to the inflation outlook. This week, Sophia Mavridis is joined by Bell Financial Group’s CIO Will Riggall to discuss his approach to navigating this climate, focusing on how these macro pressures translate into real-world economic impacts and corporate performance.
In this week’s video, Sophia and Will cover:
- why a shift in geopolitical strategy is keeping upward pressure on Brent crude and global inflation
- a look at the RBA’s recent hike and why the path toward lower rates is becoming more complicated
- what the leadership transitions at BHP (ASX:BHP) and Woodside (ASX:WDS) mean for their futures.
As the Middle East conflict entered another week the market saw its greatest volatility yet, with Monday bringing about the worst single day drop since the COVID pandemic of 2020.
Today, Sophia Mavridis sat down with Bell Financial Group’s CIO Will Riggall to discuss the impact the Iranian war has on our local market, a comparison on sector movements, and economic data to look out for.
In this week’s video, Sophia and Will cover:
- the second week of the Iran conflict and how the market reacted
- the continuing volatility of oil prices
- the movement of the Australian dollar
- a diversification strategy in the face of market uncertainty
- economic data to watch from the US.
Wall St saw a mixed session overnight as the US – Iran war and oil price volatility continued to weigh on investors. The Dow Jones closed down 0.6%, the S&P500 inched down 0.1%, while the Nasdaq gained 0.1%.
What to watch today:
- Looking ahead to the today’s trade, the SPI futures indicate that our local market is poised for a drop at the open, suggesting a 0.5% pull back. Investors are largely reacting to the lack of a clear path to a resolution of the Iran conflict, as President Trump said yesterday that the US and Israel were not yet finished hitting Iran, while Iran itself listed 3 terms it would require for the war to end, including the payment of reparations.
- Moving over to commodities,
- Crude Oil rebounded 6% to US$88 per barrel, despite the IEA confirming that they would release 400 million barrels from emergency reserves, its largest ever release. Even with the additional supply, the price will continue to stay high as long as the long term uncertainty remains.
- Precious metals remain relatively stable, continuing the trend we have seen developing over the last few days. Gold is trading just 0.2% down at US$5,180 per ounce, while silver is down 2.9% at a little under US$86 per ounce.
Trading ideas:
- Finally, we’ll end on some trading ideas for your consideration today. Bell Potter have upgraded their recommendation on Lynas Rare Earths (ASX:LYC) from a Sell to a Hold, with an upgrade on the 12 month price target from $11.60 per share to $19 per share. This comes after the company announced it had extended the Japan Australia Rare Earths offtake agreement to 2038, effectively guaranteeing revenue of around $775 million at the current exchange rate.
- And Bell Potter maintain their Buy rating on Telix Pharmaceuticals (ASX:TLX) with a 12 month target price also of $19 per share, off the back of yesterday’s announcement of successful phase 1 trials for its prostate cancer therapy.
Wall St overnight saw a very slight pullback after a choppy trading session, as trader remained wary of developments in the ongoing Iran war. The S&P500 dropped 0.2% by close of trade, the Dow Jones dropped 0.1%, and the Nasdaq ended the trading day flat.
What to watch today:
- Looking ahead to today’s trade locally, the ASX is expected to build on yesterday’s momentum and rise, with the SPI futures suggesting a 0.3% increase at the open.
- Moving straight to commodities news,
- Crude Oil has retreated further from its historic surge on Monday, currently trading down around 8.8% to US$86 per barrel. The drop comes after the International Energy Agency or IEA announced they would convene an extraordinary meeting of member countries to discuss the possible release of oil stockpiles to the market to relieve supply constraints. IEA members collectively hold around 1.2 billion barrels of oil in reserve.
- Meanwhile, precious metals continue to steadily advance off the back of safe haven demand while uncertainty lingers. Gold is trading around 1% up at just under US$5200 per ounce, while silver is trading 1.5% up at US$88 per ounce.
Trading ideas:
- Finally ending on some trading ideas for your consideration today. Bell Potter has upgraded its recommendation on Eagers Automotive (ASX:APE) from a Hold to a Buy, with a 12 month price target of $28.50, which at the current share price of $21.11 implies 335% capital growth over the period.
- And Bell Potter have maintained their Buy rating on Orica (ASX:ORI), with a 12 month price target of $28.50, after the company provided its first half FY26 update, outlining positive group momentum continuing into the second half of the year.
US equities rallied late in the trading session following President Donald Trump’s comments to CBS News that he thinks the war against Iran could soon end. The headlines steadied global markets and all three major benchmarks closed in the green.
The Dow Jones gained 0.5%, the S&P500 up 0.8% while the tech-heavy Nasdaq advanced 1.4%, all marking impressive turnarounds from the losses seen earlier in the trading session.
What to watch today:
Following global markets, the Australian market is set to rebound, with the SPI futures suggesting a 2.15% rise at the open this morning, after a $90 billion sell-off yesterday.
In commodities,
- Crude oil is in the red, however back up to US$85.08 per barrel, after G7 finance ministers said the group is ready to release oil from strategic reserves if needed.
- The price of gold has fallen to $5,133 per ounce as a firmer US dollar and diminishing expectations of the Fed’s rate cuts offset safe-haven demand from the escalating Middle East conflict.
- And iron ore is in the green at US$102.90 per tonne.
In economic news,
- Westpac is set to release its March consumer confidence report at 10:30am AEDT
- And NAB will release the February business confidence and conditions reports at 11:30am AEDT.
- Overseas, investors are waiting on China’s latest trade data.
- And AU$1.00 is buying US$0.71.
Trading ideas:
- Bell Potter maintain a Buy rating on Nickel Industries (ASX:NIC). While the conflict in the Middle East is resulting in an immediate market impact to key input costs and the duration is uncertain, Bell Potter’s view is that while margins may be impacted, NIC is insulated due to its diversified nickel product suite. Their 12-month price target is $1.45 and at the current share price of $0.88, this implies 64.8% share price growth in a year.
We’re poised for a rough start to the week, after Wall St saw a sizeable drop last Friday to cap off a highly volatile week. The Dow Jones lost 1%, the S&P500 fell 1.3%, while the Nasdaq lost 1.6%. On top of the ramifications of the ongoing Middle East conflict, investors also reacted to softer than expected US Jobs data which was released on Friday, adding to the sell-off.
What to watch today:
- Looking ahead to today, the ASX is set to nosedive this morning, with the SPI futures pointing to a 1.8% drop at the open of trade today.
- The biggest story remains commodities, particularly Crude Oil. The supply fears remain around the Strait of Hormuz, which showed no signs of subsiding after President Trump’s latest rhetoric on Truth Social, in which he claimed there would not be an end to the war without “unconditional surrender” from Iran.
- Crude Oil is currently trading at US$92 per barrel, the first time it has crossed the US$90 benchmark in nearly 2 years. This brings the total price gain for the week to 35% - the highest week price gain since oil futures began trading in 1983.
- Despite the volatility across the rest of the market precious metals remain trading relatively stably – Gold is currently trading at US$5158 per ounce, continuing to rest around the $5100 mark it has sat at for the last few days.
- Silver similarly is currently trading at US$84.40 per ounce, representing a gain of 2.5%.
- Finally, looking at some trading ideas for today: Bell Potter maintain their Buy rating on athlete tracking solutions provider Catapult Sports (ASX:CAT), with a 12 month price target of $4.85, reinforcing it as one of their preferred tech stocks in the mid cap range.
- They also maintain their buy rating on agricultural chemicals supplier Nufarm (ASX:NUF) with a 12 month price target of $3.60, which at the current price of $2.12 per share implies a 70% capital growth over the period.
The conflict in the Middle East intensified this week, resulting in broad-based market instability and a drop in global equities. This week, Sophia Mavridis sits down with Bell Financial Group’s CIO Will Riggall, to unpack how markets historically respond to geopolitical shocks, and how investors can position themselves to navigate this challenging period.
In this week’s video, Will and Sophia cover:
- a final look back on reporting season – the key takeaways
- the surge in oil and gas prices and its broader economic impact
- which sectors provide opportunities for investors
- Bell Potter’s strategy for managing volatility and minimising risk.
Overnight, Wall St saw a rebound from yesterday’s sell off, as investors fears about surging oil prices and an extended conflict in the Middle East were allayed somewhat. The Dow Jones added 0.5%, the S&P500 gained 0.8%, while the Nasdaq was the biggest winner adding 1.3%, spurred by chip stocks such as Micron and AMD gaining 6%.
What to watch today:
- Back home, the ASX is set for a similar rebound, after yesterday’s session saw $60 billion erased from its market cap in a 1.9% drop the second worst day since last April’s Liberation Day. The SPI futures indicate the ASX will open 1.1% higher.
- Moving to some trading ideas for today, Bell Potter have maintained their buy rating on Endeavor Group (ASX:EDV), with a 12 month price target of $4.15, as they believe that market expectations are low for the company’s strategic refresh, leaving room for greater upside potential.
- They also maintain their buy rating on Genusplus Group (ASX:GNP) with a 12 month price target of $9.50, after the company announced it has entered into an agreement to acquire 100% of Railtrain Holdings Pty Ltd for a total consideration of $55 million, solidifying its track record of strong M&A strategy.
- Finally ending on some commodities news, which have somewhat stabilised after a few days of heightened volatility.
- The surging Crude Oil has flattened, trading just 1.8% up at around $75 per barrel, largely due to President Trump’s pledge to deploy the US navy to provide risk insurance for all tankers passing through the Strait of Hormuz.
- Precious metals have seen similar trends, with Gold up 0.9% to US$5133 per ounce, and silver up 1.5% to US$82 per ounce. Gold especially has seen a conflict of both headwinds and tailwinds of late, as geopolitical uncertainty creates safe haven demand, however a strong US dollar and inflation fears from higher energy costs put downward pressure on the price.
Wall St plunged overnight as the US-Iran conflict showed no signs of slowing down, with all 3 indexes down more than 2 and half percent at their lowest points of the day. However, shares did somewhat recover in the afternoon, with the major indexes ending up closing around 1% down – the Dow Jones lost 0.8%, the S&P500 0.9% and the Nasdaq shed 1%.
What to watch today:
- Looking ahead to today, the ASX is poised to see a similar result, with the SPI futures pointing to a 1.4% drop at the open of trade today. Global markets are reacting to growing threat that this conflict will last longer than initially expected, passing beyond a brief exchange of missiles.
- The RBA is also due to release Australia’s 4th quarter GDP data at 11:30am, with economists forecasting a 0.6% lift quarter to quarter, which will take annual growth to 2.2%. Results that fall significantly short of this could cause the markets to react accordingly.
- Following their record results yesterday, Bell Potter have maintained their Buy rating on Life360 (ASX:360), with a 12-month price target of $40 per share, based on their updated revenue and EBITDA forecasts for 2026 and 2027.
- Bell Potter have also maintained their Buy recommendation on ALS (ASX:ALQ), with a target price of 12 month price target of $28 per share, based on strengthening industry tailwinds and higher exploration spend.
- Finally, ending on commodities news, which have remained volatile overnight.
- Crude Oil peaked at over US$80 yesterday, but has since come down to US$75 per barrel as supply chain fears around the Strait of Hormuz persist. President Trump has suggested that the US navy could be deployed to escort ships through the Strait if necessary, providing the market some relief.
- Precious metals also saw significant pullbacks – Gold is down 4.3% to just under US$5100 per ounce, while silver is down 8% to US$82 per ounce.
It was a volatile trading day on Wall St yesterday as the US market reacted to the weekend’s geopolitical developments in the Middle East. All 3 major indexes saw a major sell off in the morning, dropping over 1.5% at intraday lows. However, the afternoon saw a recovery as investors jumped on the buy opportunities. At the end, the S&P500 closed up 0.04%, the Nasdaq closed up 0.4% and the Dow Jones edged down slightly 0.2%.
What to watch today:
- Looking ahead to today, the SPI futures are indicating that the ASX will waver, with a 0.2% drop at the open of trade.
- Although the bulk of reporting season is behind us, keep an eye on popular tech name Life360 (ASX:360), which is due to release its quarterly results this morning.
- The biggest story of the day remains in commodities, which are still volatile following the weekend’s news.
- Crude Oil prices remain heavily inflated due to fears of supply chain disruption. As of this morning, it is trading up 6.4% at just over US$71 per barrel. The major risk factor sending the price higher is threats to the Strait of Hormuz, the waterway bordered by Iran to the north through which about 20% of the world’s seaborne oil trade flows. If this is blockaded further, it would cause a significant undersupply, causing crude oil prices to skyrocket.
- Gold is also trading higher, trading up another 1% to US$5330 per ounce. This spike comes as gold remains a traditional safe haven for investors during periods of volatility. In contrast, silver, which usually follows a similar trend to gold, is trading down 4.7% at US$89 per ounce. The reason for the disparity is that unlike Gold, around 50% of silver’s value remains tethered to industrial usage and demand, which has wavered in the face of possible supply chain risks. This industrial demand is what pushed silver so high so quickly in comparison to gold over the last few months, but it is also the reason why it sees more volatility than gold.
- During this period of geopolitical uncertainty, the Gold price will continue to have significant tailwinds behind it, which creates a buying opportunity in the gold industry. One such stock that Bell Potter recommends with a speculative Buy rating is Santana Minerals (ASX:SMI), which they give a target price of $1.70 per share. The company completed the first tranche of a $130m institutional share placement, providing it with the funds raised to develop its flagship gold project in New Zealand.
We’re set for a rocky start to the week following the extreme developments out of the Middle East we saw over the weekend, with US airstrikes on Iran and Iran’s responsive strikes on Israel and the US Middle East bases.
We’re expected to see a lot of market movement and activity when markets open today. Looking at Friday’s close in the US, the Dow Jones closed 1.1%, the S&P500 down 0.4%, and the Nasdaq closed 0.4% lower.
The 10-year yield fell below 4% for the first time since November and the US 10- year and 2-year Treasury yields each dropped 6 points to 3.95% and 3.38% respectively.
What to watch today:
Looking at the day ahead, the SPI futures are suggesting that the Australian market will drop 0.2% at the open this morning.
- We’ll be closely watching the market’s reactions to the US-Iran conflict, however there may be some commodities and sectors that could benefit, including gold, oil and defense stocks.
- Looking at commodities,
- Crude oil has jumped 2.8% to US$67.00 per barrel.
- Gold is up 1.8% to US$5,278.00. Gold has been rallying in the last few weeks and is expected to advance when trading resumes. Before the weekend, Gold prices rose to a one-month high and a seventh straight month of gains, due to geopolitical tensions ahead of the weekend strikes
- While iron ore is trading flat.
- Copper futures reached a four-week high on Friday which was also the seventh consecutive month of gains. The price is up 0.97% to US$6.00 per pound.
- As for foreign exchange, the Australian dollar is down 12c to US$71.13 and we may see some pressure on currencies today.
And as our local reporting season draws to a close, February marked a third straight monthly gain and finished 3.7% higher. We saw 335 companies release their financial results, with 119 beating expectations, 109 in line with expectations and 107 missing market expectations. With much stock specific news driving market movements, two of Bell Potter’s most relent recommendations include gold producer Catalyst Metals (ASX:CYL) and developer Summerset Group (ASX:SUM).
- Bell Potter have maintained their Buy rating on Catalyst Metals (ASX:CYL) and their 12-month price target at $14.60. At the current price of $8.51, implying 72% share price growth in a year.
- And they have lowered their 12-month target on Summerset Group (ASX:SNZ) to NZ$14.40, while their Buy rating remains unchanged. The current share price if NZ$10.66, implying 35% share price growth in a year.
This week, Sophia Mavridis chats with Bell Financial Group’s Chief Investment Officer Will Riggall on a strong month of earnings results and how the ASX is performing in comparison to offshore markets.
In this week’s video, Will and Sophia cover:
- the best and worst performing sectors moving the market
- Bell Potter’s choice between Coles (ASX:COL) and Woolworths (ASX:WOW)
- a dive into WiseTech (ASX:WTC) and the tech sector as AI reshapes the workforce
- Fortescue’s (ASX:FMG) results and how the company compares to BHP Group (ASX:BHP)
- what’s next for the market as reporting season draws to a close.
Starting off overseas, Wall St saw a second consecutive day of solid growth, built again on growing momentum in tech stocks. Nvidia saw a 1% rise ahead of its earnings report, which is scheduled for later this morning Sydney time and will have massive implications for the volatile tech sector. The S&P500 added 0.8%, the Dow Jones increased 0.6%, and the Nasdaq was the biggest winner, adding 1.3% on the day.
What to watch today:
- Looking ahead to today, the ASX is expected to join Wall St with back-to-back advances, building on yesterday’s momentum with a 0.7% jump at the open today.
- The bulk of reporting season is already behind us, however there are still some big names to come. Keep an eye on Qantas (ASX:QAN) and Ramsey Healthcare (ASX:RHC) results, which are scheduled for this morning. Check out Bell Direct’s reporting season landing page to access all the key info in one spot, including the interactive calendar where you can view the results from all the big companies, as well as see which ones are still upcoming.
- After their blockbuster results yesterday, Bell Potter’s research team have maintained their Buy rating on Woolworths (ASX:WOW), and updated their 12-month price target to $38.25 per share, citing the pickup in top line growth in the Australian food business.
- And the team have maintained their buy rating on Amplitude Energy (ASX:AEL), with a 12 month price target of $3.40 per share, after their reported underlying EBITDA and underlying NPAT met expectations.
- Ending on commodities news this morning:
- Crude Oil has dropped slightly to US$65.50 per barrel.
- In precious metals, gold has edged up 0.5% to $5170 per ounce, while silver is up 2.3% at $89 per ounce.
Overnight in the US, Wall St rebounded from yesterday’s sell off, spurred by software stocks as investors fears of AI disruption were eased. The tech heavy Nasdaq lead the way jumping 1%, while the S&P500 and Dow Jones both advanced 0.8%.
What to watch today:
- Back home the ASX is expected to follow suit, with the SPI futures pointing to a 0.75% jump at the open of trade.
- In reporting season, gaming machine supplier Light and Wonder (ASX:LNW) has reported a 4% rise in revenue to US$3.3 billion, an adjusted net profit before amortisation increase of 18% to US$567 million, which puts them firmly in line with guidance.
- Other major companies are due to release their results this morning, including Fortescue Metals (ASX:FMG), Woolworths (ASX:WOW) and WiseTech Global (ASX:WTC).
- So far this reporting season, 206 companies have reported their results, with 38% beating expectations, 32% in line, and 30% missing expectations.
- Following on from their results, Bell Potter have upgraded end-to-end mining technology solutions provided Imdex (ASX:IMD) from a hold to a buy, and increased their 12-month price target from $3.60 to $4.60 per share. This comes after they announced an underlying EBITDA increase of 22% YoY, which beat forecast by 9%.
- Similarly, they have maintained their Buy rating on electrical equipment distributor IPD group (ASX:IPG), with a 12-month price target of $5.30, after thei announced an 8% underlying EBITDA increase YoY, which represented a 2% beat on forecast.
- Additionally today, keep an eye on the January CPI data which is due at 11:30am Sydney today – NAB analysts have predicted that both headline and trimmed-mean inflation will remain unchanged for the month, so any unexpected changes could impact the markets.
- Finally ending with commodities news,
- Crude oil has once again remained flat for the 3rd consecutive day, trading at slightly over US$66 per barrel.
- For precious metals, both gold and silver have pulled back slightly from yesterday’s highs, with the former down 1.3% to US$5161 per ounce, and the latter down 1% to US$87.30 per ounce.
Starting abroad this morning, it was a tough start to the week in Wall St which saw all 3 major indexes tumble as investors weigh fears of AI disruption across various industries, as well as the announcement of further tariffs. The Dow Jones dropped 1.7%, the Nasdaq declined 1.1%, while the S&P fell 1%.
What to watch today:
- Back home, despite the rout in New York the ASX is expected to open in the green this morning, with the SPI futures indicating a 0.3% jump at the open of trade today.
- Turning to reporting season, we’ve seen some big announcements this morning already. Starting with Regal Partners (ASX:RPL), which announced substantial beats on its targets, with a 47% increase in income and a 65% jump in profit from last year.
- Monadelphous (ASX:MND) saw similarly positive results, announcing a record half year revenue which was 46% up from last year, while net profit climbed 53%.
- Keep an eye also on Woodside Energy (ASX:WDS), and Nine Entertainment (ASX:NEC), which will also be reporting today.
- So far, we’ve seen 173 companies report their results this reporting season. Of them, 69 companies or 40% have beaten expectations, 56 companies or 32% are in line, and 48 companies have missed expectations, making up the remaining 28%.
- Following their results yesterday, Bell Potter have maintained their buy rating on counter drone technology supplier Electro Optic Systems (ASX:EOS), however reduced their 12-month price target from $12 to $9.70, off the back of a combination of lower projected revenue and higher costs.
- The team have also upgraded employee benefits provider McMillan Shakespeare (ASX:MMS) from a Hold to a Buy with a 12 month target price of $18.50, following their results and FY26 guidance.
- And to end with commodities news:
- very little change in the Crude Oil price, which is trading just about flat at US$66 per barrel.
- However, it was a different story for precious metals, which have seen their rebound from the sell-off earlier this month continue as tariff uncertainty is back in the news. Gold is trading up 2.4% at around US$5230 per ounce, while Silver is up 4.7% to US$88.50 per ounce.
All three US equity benchmarks closed in the green after the US Supreme Court ruled against some of US President Donald Trump’s global tariffs. The Dow Jones closed 0.47% higher, the S&P500 up 0.69%, while the tech- heavy Nasdaq advanced 0.9%.
What to watch today:
- Following US equities, our local market is set to rise 0.18% according to the SPI futures.
-
As we enter the final week of reporting season, the local market continues to be driven by stock-specific movements. Some notable updates from this mornings financial reports include:
- Fisher and Paykel Healthcare (ASX:FPH) have upgraded their earnings guidance for the year to March.
- Reece (ASX:REH) reported a 20% fall in profit for their first-half.
- Kogan.com (ASX:KGN) increased its interim dividend by 14.3% to 8c, however profit dropped to $8.2 million.
- Nuix (ASX:NXL) reached a net profit of $11.1 million for the half, in comparison to a loss of $10.4 million a year prior.
- And Ampol (ASX:ALD) has reported a 33% drop in net profit for the full year.
- Two companies Bell Potter are watching this week include Mineral Resources (ASX:MIN) and Telix Pharmaceuticals (ASX:TLX). The broker maintains a Buy rating on MIN with a 12-month price target of $70.00. At the current share price of $51.25, this implied 36.6% share price growth in the year. And Bell Potter also maintain a Buy rating on Telix, but have lowered their price target from $23.00 to $19.00. At the current price of $10.43, this implies 82.2% share price growth in a year.
- Among the long list of companies reporting today are Adairs (ASX:ADH), Lendlease Group (ASX:LLC), Praemium (ASX:PPS) and Regis Healthcare (ASX:REG).
- In commodities,
- Crude Oil is in the green at US$66.48 per barrel, nearing a six- month high following news that the US President is considering a limited military strike on Iran.
- The price of Gold has rallied over 2% to US$5,109.17 an ounce. The appeal for gold was reinforced due to two key factors. First, following the Supreme Court’s ruling against reciprocal duties, the initial dollar retreat was quickly offset by statements from the US President around signing a new 10% global tariff. In addition to the trade policy pivot, US GDP data for Q4 was a disappointing report at 1.4%.
- And iron ore is trading lower at US$99.33 per tonne.
It’s been the strongest week of reporting season so far, with a flurry of big companies releasing their results. Sophia Mavridis sits down with Bell Financial Group’s CIO Will Riggall to unpack the biggest stories, market movers, and sector trends.
In this week’s video, Sophia and Will cover:
- macro factors affecting the market at the moment
- notable results including JB Hi-Fi (ASX:JBH), Bluescope Steel (ASX:BSL), and CommBank (ASX:CBA) and what they mean for the market
- BHP’s (ASX:BHP) results and a look at the broader resources sector
- the best and worst performing stocks of the week
- stocks to watch out for next week.
Starting in the US this morning, where Wall St saw a positive day lead by a rally in the technology sector. Megacap Nvidia lead the way with a 2% gain, after Meta announced that they would be expanding their deal to use millions of Nvidia AI chips in their data centre buildout. At the close of the day’s trade, the S&P500 advanced 0.6%, the Dow Jones added 0.3%, while the tech heavy Nasdaq saw the biggest gains with a 0.8% jump.
What to watch today:
- Locally today, the ASX is expected to follow Wall St and add to its winning streak of late, with the SPI futures pointing to a 0.5% climb at the open of trade.
- As for reporting season, it’s a busy day today with a stack of notable companies releasing results. Australia’s largest Telco Telstra (ASX:TLS) this morning announced a 9% increase in net profit to $1.1 billion, as its revenue remained flat however expenditure had declined. It will pay an interim dividend of 10.5 cents per share, up from 9.5 cents last year.
- Although not released at time of recording, keep an eye on a number of big results to come out throughout this morning, including Rio Tinto (ASX:RIO), Wesfarmers (ASX:WES), Goodman Group (ASX:GMG) Whitehaven Coal (ASX:WHC), Downer (ASX:DOW) , among many more.
- So far this reporting season, we’ve seen 83 companies release their results, with 31 beating expectations, 32 in line with expectations and 20 missing expectations.
- Following their results yesterday, Bell Potter have upgraded their rating on TechnologyOne from a Hold to a buy, with a 12-month price target of $29 per share after the company reported their guidance for FY26.
- And finally ending on commodities news, crude oil prices have jumped 4 and a half percent to US$65 per barrel as investors reacted to talks in both the US – Iran tensions and Russia – Ukraine conflict ending without clear breakthroughs. The geopolitical uncertainty has also affected precious metals prices, with gold rebounding 2% to just under US$5000 per ounce, while silver has jumped 5% to US$77 per ounce.
Starting off overseas, it was a relatively quiet day for Wall St on its reopen from Monday’s public holiday, as all 3 of the major indexes advanced 0.1%.
What to watch today:
- Looking now at today, the ASX is set to extend on yesterday’s gains with the SPI futures indicating a 0.5% jump at the open of trade today.
- Pivoting to a reporting season update, NAB (ASX:NAB) reported a 30% jump in net profit to $2.21 billion, and a 16% jump in cash earnings to $2.02 billion for the quarter to December.
- Queensland based insurer Suncorp (ASX:SUN) saw a massive reduction in profit after a period of increased natural hazard events. November’s hailstorm in particular was costly, as claims drove Suncorp $453 million over allowance for natural disasters. Their cash earnings of $270 million represented around a third of last years, while the dividend has been cut from 63c per share to 17c per share.
- And look out for other companies reporting today, including Dexus (ASX:DXS), Santos (ASX:STO) and TechnologyOne (ASX:TNE).
- So far this reporting season, 69 companies have released their results, with 26 beating expectations, 26 in line with expectations, and 17 missing expectations.
- Bell Potter’s research team have maintained their buy rating on diversified industrial services group SRG Global (ASX:SRG), and increased their 12-month price target from $3 per share to $3.15 per share off the back of solid results released yesterday and an upgrade in guidance.
- And in commodities,
- Crude oil is trading down a further 1% to US$62.25 per barrel, after it was announced that the US and Iran had reached a ‘general agreement’ on a potential nuclear deal that would pave the way towards a lift in sanctions on Iran, and reduced risk of war in the region.
- In precious metals both gold and silver are trading down over 2%, with gold falling to US$4882 per ounce, and silver down to US$73.50 per ounce. The decline can be attributed to a number of factors, including a strengthening US dollar, reduced market liquidity due to the public holidays, and geopolitical developments reducing safe haven demand.
Not much to report overseas from overnight, as Wall St was closed for the President’s Day public holiday.
What to watch today:
- Jumping straight into today’s news, the ASX200 is set to jump 0.2% at the open to extend on yesterday’s gains.
- Today’s major story is the results of mining giant BHP (ASX:BHP), which reported a 25% jump in underlying EBITDA to US$15.5 billion, a net operating cash flow of US$9.4 billion, which is up 13%, and a dividend of 73 US cents per share, which is up from 50 US cents this time last year.
- Additionally, funds manager Challenger Ltd (ASX:CGF) reported their results, with statutory net profit up $72 million to $339 million, and a fully franked dividend of 15.5 cents per share, which is up 7%. They also announced an on-market share buyback of $150 million.
- Keep an eye on other notable companies who are due to release today, including Seek (ASX:SEK), Judo Capital (ASX:JDO) and Reliance Worldwide (ASX:RWC).
- So far this reporting season, 53 companies have reported their results, with 18 beating expectations, 21 in line with expectations, and 14 misses.
- After their results yesterday, Bell Potter’s research team have maintained their Hold rating on the a2 Milk Company (ASX:A2M), however reduced their 12 month target price from $9.70 to $9.55 per share, based on their key guidance figures heading into the next year.
- They also maintain a hold rating on shipbuilder and defence contractor Austal (ASX:ASB), with a 12 month price target of $6.60 per share, which is down from their previous price target of $8 per share. This comes after its EBIT guidance was downgraded 18.5%, due to the discovery of accidental double counting of US$17.1 million of incentives during the preparation of its latest accounts.
- Finally in commodities, Gold is trading down just over 1% at US$4990 per ounce, while silver has dropped 1.8% to $76.50 US$ per ounce. Crude Oil is up 1.4%, to US$63.80 per barrel.
US equities closed mixed on Friday following the release of the inflation report which came in just slightly lower than the market was expecting. US CPI rose 0.2% in January, reflecting a gain of 2.4% on an annualised basis, while a 0.3% MoM gain was expected.
The S&P500 rose just above the flat light, up 0.05%, the Dow Jones flat, just 0.1% higher, while the Nasdaq declined 0.22%.
What to watch today:
Locally, the ASX200 is set to gain 0.58% at the open this morning, ahead of the release of key earnings results from big names reporting today:
- JB Hi Fi (ASX:JBH) has just released their half year results this morning, with total sales and NPAT both up more than 7%, EPS increased by 19cps to 279.7cps from HY25 and an interim dividend of 210cps, up 23.5%, representing 75% of NPAT. Bell Potter currently have a Buy rating on JBH.
- The a2 Milk Company (ASX:A2M) posted a 18.8% rise in revenue and lifted FY26 guidance, as well as an interim dividend of 11.5cps fully franked. It’s share price will be on watch today.
- Ansell (ASX:ANN), Aurizon Holdings (ASX:AZJ), BlueScope Steel (ASX:BSL) and New Hope Corporation (ASX:NHC) are also set to report today.
As for what Bell Potter are looking at today:
- Following Nick Scali (ASX:NCK)‘s first half NPAT up 11% above expectations, Bell Potter maintain a Buy rating, however have lowered their price target by 11% to $25.00 due to softer growth into the second half, earnings revisions and the rising interest rate environment.
- And one to watch in the resources sector following the release of first half earnings is Northern Star Resources (ASX:NST). Bell Potter maintain a Buy rating and have increased their 12-month price target from $31.10 to $35.00. At the current share price of $28.37 this implies 23.4% share price growth in a year.
In commodities:
- Crude oil is up to US$62.89 per barrel, with a second straight weekly decline, amid persistent oversupply concerns. The International Energy Agency reiterated that the market is likely to face a surplus of just over 3.7 million barrels per day in 2026.
- The price of gold is up almost 2.5% to US$5,043.92 per tonne, as softer-than-expected US inflation eased pressure on Treasury yields and weighed on the dollar.
- Iron ore is down to US$99.66 and over the past month, Iron Ore's price has fallen 7.45%. So keep watch of iron ore miners this week as BHP Group (ASX:BHP) reports tomorrow.
- To end, AUD$1.00 is currently buying US$0.70.
As reporting season reshapes the market landscape this week, Sophia Mavridis sits down with Bell Financial Group’s Chief Investment Officer Will Riggall to unpack the biggest results, emerging trends, and preview of what’s to come.
In this week’s video, Sophia and Will cover:
- the impact of AI on global markets, especially in the tech sector
- Commonwealth Bank’s (ASX:CBA) results and the financial sector rally
- a look ahead to next week, including a preview of Treasury Wines (ASX:TWE), and JB Hi-Fi (ASX:JBH).
Note: This interview was filmed on 13 February 2026.
Overseas, Wall St traded slightly down overnight despite the much-anticipated jobs data coming in better than expected. Economists polled by Dow Jones had forecasted a gain of 55,000 jobs, and an unemployment rate of 4.4%, however the data revealed a gain of 130,000 jobs and an unemployment rate of 4.3%. However, the beat failed to move the markets, as the Dow Jones ended the day down as the Dow Jones and Nasdaq both slipped 0.1%, while the S&P500 ended the day flat.
What to watch today:
- Heading into today’s trading session, the ASX is expected to follow Wall St’s wavering session, with the SPI futures pointing to a 0.02% drop at the open
- Another busy day of results ahead as Reporting Season continues, look out for AMP (ASX:AMP), Pro Medicus (ASX:PME) and Northern Star (ASX:NST) releases, which are all due this morning. You can find all results once released at Bell Direct’s reporting season page
- So far this reporting season, 17 companies have released their results, with 3 beating expectations, 9 in line with expectations, and 5 misses
- Following their results yesterday, Bell Potter’s research team have maintained their hold rating on CSL (ASX:CSL), however cut their 12-month price target from $195 per share to $175 per share, after updating their Adjusted NPAT and revenue growth guidance off the back of underwhelming results.
- Bell Potter have also upgraded their rating on SGH (ASX:SGH) from a Hold to a Buy, with a 12-month price target of $56 per share. This comes after the company reported results that beat guidance, sparking a more optimistic medium term outlook.
- And in commodities, Crude Oil is trading up 1.6% at US$65 per barrel, Gold also jumped overnight 1.4% to just under US$5100 per ounce, while silver remains the most volatile, trading up 4.7% at US$84.50 per ounce
Starting over in the US, Wall Street saw a mixed trading session overnight, as the S&P500 and Nasdaq slipped 0.2% and 0.6% respectively, while the Dow Jones added 0.1%, at one point in the day trading at its 3rd all time high in the last 3 days. The market was weighed down by financial stocks, which took a hit after tech platform Altruist officially launched their new AI-powered tax planning tool. Investors are likely to rotate to areas which are most protected from being impacted by the emerging prevalence of AI.
What to watch today
- The ASX200 is expected to rise at the open today, with the SPI futures indicating an increase of 0.3%
- A big morning in reporting season as Australia’s biggest bank Commonwealth Bank (ASX:CBA) announced their cash profit has increased 5% to $5.4 billion in the half year ending 31 December, and that they will pay a dividend of $2.35 per share.
- Although not released at the time of recording, keep an eye on other major results including AGL Energy (ASX:AGL), Evolution Mining, and James Hardie Industries (ASX:JHX), which are all due to be released this morning. You can stay up to date with results as they come out via Bell Direct’s reporting season page
- Pharmaceutical giant CSL (ASX:CSL) also announced their results, reporting total revenue down 4% to $8.3 billion, Adjusted Net profit after tax of $1.9b, which is a 7% drop, and a reported NPA of $0.4 billion, which represents an 81% drop from last results. These results come in a day after it was announced that they would be dumping chief executive Paul McKenzie, extending the volatile period for the blue chip stock.
- In Bell Potter’s latest research, the broker has maintained its Buy rating, however lowered the 12-month target price on WiseTech Global (ASX:WTC) from $100 per share to $87.50, citing the fact that the stock is currently trading on its lowest EBITDA multiple since its IPO nearly 10 years ago.
- And in commodities, Gold has slipped 0.7% to be trading a shade over US$5000 per ounce, while silver has dropped 3.2% to 80 USD ounce. Crude Oil has remained flat at US$64.17 per barrel.
Thank you for joining us. We are back with daily market updates over reporting season, where we aim to set you up for the trading session ahead. We’ll cover global markets, the latest Bell Potter research, and analyst expectations for listed companies reporting their financial results each day.
Overnight we saw yet another tech driven rally. US equities closed higher with artificial intelligence in focus, ahead of the release of economic data that will help shape the Fed’s outlook. At the time of recording, the Dow Jones is up 0.04%, the S&P500 up 0.5%, while the Nasdaq has reached a gain of 0.93%.
The S&P 500 software services index gained as Shares of service almost 3%, while Salesforce and CrowdStrike gained 1.2% and 3.1% respectively.
In other economic news this week, investors will also be monitoring the January non-farm payrolls report out on Wednesday, which was delayed by a partial US government shutdown and the must anticipated January consumer price index, out on Friday.
What to watch today:
- Following US equities, the Australian market is set to rise 0.35% at the open, according to the SPI futures.
- In Bell Potter’s latest research, the broker has lowered their price target on Sonic Healthcare (ASX:SHL), cautioning ahead of the H1 results set to be released on the 19th, however have maintained their Buy rating, noting the primary growth driver should be the acquired growth in the pathology business and that while their EBITDA estimate is in line with consensus, their margins are higher than consensus due to a lower revenue estimate.
- Bell Potter also released a Buy rating on REA Group (ASX:REA) and lowered their 12-month price target to $211. At the current share price of $168.10, this implies 25.5% share price growth in a year.
- So far this reporting season, 13 companies have reported results, with 3 beating analyst expectations, 5 in line with expectations and 5 missing expectations. Today Amotiv (ASX:AOV) and Computershare (ASX:CPU) are set to report today.
- And Gold has topped $5,000 an ounce, and the US dollar fell. Oil is up to US$64.29. US President Trump struck optimism over the negotiations with Iran regarding a potential deal on defusing Iran's uranium enrichment capabilities. Oil prices had soared in previous weeks after the escalating tensions between both countries drove markets to consider the risk of the US enforcing sanctions on Iranian oil to a greater extent.
The ASX200 is reflecting an over 5% increase YTD but stretched valuations and lagging financials mean investors should tread carefully heading into 2026. Analysts expect resources to take the lead next year, supported by signs of stabilisation in China, while banks and tech face tougher conditions. With the RBA likely pausing rate cuts through early 2026 and inflation still sticky, sector positioning will be key.
In this week’s video, Sophia covers:
- (0:22): a review of the ASX200 in 2025
- (1:02): the risks heading into 2026
- (1:21): resources, rates & the key themes for next year
- (2:34): how the local market performed this week so far
- (3:33): the most traded stocks and ETFs this week
- (4:76): economic news items to look out for next week.
Overnight, Wall St surged after the Federal Reserve officially approved a quarter percentage point cut to the interest rates, bringing the rate to the range of 3.50% - 3.75%. The Dow Jones rallied 1.1% on the news, the S&P500 jumped 0.8% and closed just shy of its all-time high, and the Nasdaq gained 0.5%. In his remarks, Chairman Jerome Powell ruled out any chance of a rate increase in 2026, and investors are betting that there will be at least one, if not multiple rate cuts to come next year – a bullish sign for equities.
Europe saw another relatively stable trading session – the Stoxx600 index closed up 0.1%, as the FTSE advanced by a similar amount while the German DAX and French CAC declined by 0.1% and 0.4% respectively.
And in Asia, the CSI fell 0.1%, the Hang Seng gained 0.4% and the Nikkei fell 0.1%.
Locally yesterday, the ASX200 edged down 0.1%, however it was only the high flying materials sector which prevented greater losses on the day, as 9 of the 11 key sectors posted losses on the day. Gold miners were particularly strong in the wake of the Fed’s rate cut, with big names Newmont (ASX:NEM) and Northern Star (ASX:NST) increasing 4.4% and 5.1%.
What to watch today:
- Looking ahead to today, the ASX is expected to follow Wall St’s strong session, with the SPI futures indicating a 0.9% jump at the open of trade today.
- Moving over to commodities,
- Crude Oil has jumped 1.25% to US$58.98 per barrel, continuing its pattern of volatility over recent weeks.
- Precious metals were buoyed by the rate cuts, with Gold advancing 0.5% to US$4227 per ounce, while Silver has jumped another 1.9% to further extend on its already record high price, and is now trading at US$61.80 per ounce.
- And Iron Ore is trading up 0.4% to US$106.66 per tonne.
Trading Ideas:
- Bell Potter maintains a speculative Buy rating on emerging online marketplace operator Frontier Digital Ventures (ASX:FDV), with a 12 month price target of 57c per share, based on their projected revenue streams moving into CY26.
- And Trading Central have identified a bullish signal in Newmont Corporation (ASX:NEM), indicating that the price may rise from the close of $139.10 per share to the range of $160 - $164 per share over a period of 25 days, according to the standard principles of technical analysis.
Starting in the US overnight, Wall St saw a relatively flat session, as all eyes remain on the impending Fed meeting later this week. While investors are expecting a nearly 90% chance of a rate cut, focus will be on the economic projections and the general sentiment of Chairman Jerome Powell to help shape how markets will react over the next few weeks. The S&P500 closed the trading day flat, the Nasdaq gained 0.1%, while the Dow Jones fell 0.4%, primarily weighed down by 4.7% drop for JP Moregan Chase, who reported higher than expected 2026 expense projections.
Elsewhere, it was a similar story in Europe as the Stoxx600 index ended the day slightly down 0.1%, where 0.5% rise for the German Dax and a 0.7% fall for the French CAC offset, while the FTSE remained just about flat.
And in Asia, the Chinese CSI fell 0.5%, the Hang Seng fell 1.3%, while the Nikkei added 0.1%.
Locally yesterday, the ASX200 extended on its losses from Monday with a 0.5% slide, mainly in the afternoon after the RBA announced that the cash rate would remain unchanged at 3.6%. Although this was widely expected, the market reacted to comments from RBA Governor Michele Bullock stating that no rate cuts were on the horizon for the “foreseeable future.”
What to watch today:
- Looking ahead to today however, the ASX is expected to rebound from the last 2 days’ losses, with the SPI futures indicating a 0.3% jump at the open of trade.
- Over to commodities,
- Crude Oil prices have slipped a further 0.8% to US$58.40 per barrel.
- In precious metals, Gold is trading up 0.5% at US$4209 per ounce, while Silver has jumped another 4.5% to over US$60 per ounce, smashing its previous all time high and reaching 110% price gain year to date. The run is driven by squeezing supply, as well as a surge in demand for industrial usage, as silver is currently used in areas such as electronics and solar panels.
- Meanwhile, Iron Ore remains stable at US$106.29 per tonne.
Trading Ideas:
- Finally, we’ll dive into some trading ideas for your consideration today. Bell Potter maintains its buy rating on online automative retailer CAR Group (ASX:CAR), with a 12 month price target of $42.20 per share. Their recommendation is based on its steadily accelerating growth, and forecasted earnings for next year.
- And Trading Central have identified a Bullish signal in Vicinity Centres (ASX:VCX), indicating that the price may rise from the close of $2.48 to the range of $2.69 to $2.73 over a period of 24 days, according to the standard principles of technical analysis.
Overnight the US markets pulled back to start the week, as investors await the Fed’s pivotal final meeting of 2025 later this week. The S&P 500 slid 0.5%, the Nasdaq slid 0.4%, while the Dow Jones slid 0.6%.
There was mixed sentiment across other global markets - the pan-European Stoxx600 dropped just under 0.1%, as 0.1% gain for Germany’s Dax was outweighed by a 0.2% drop for the FTSE and a 0.1% drop for the French CAC.
And in Asia, the Chinese CSI gained 0.8%, the Japanese Nikkei added 0.2%, while Hong Kong’s Hang Seng fell 1.2%.
Back in Australia yesterday, the ASX 200 opened the new trading week with a 0.1% decline, with just 3 of the 11 key sectors posting gains on the day. It was a mixed day for materials, as gold miners saw losses across the board, while lithium miners Liontown resources (ASX:LTR) and Pilbara Minerals (ASX:PLS) jumped 15% and 6% on the day.
What to watch today:
- The ASX 200 is expected to extend its losses, with the SPI futures indicating a 0.3% drop at the open of trade.
- Moving over to commodities:
- Crude Oil remains volatile, trading down 2% at US$58.87 per barrel, after it was announced that Iraq would resume production on one of its major oilfields, increasing oversupply worries.
- It was a relatively stable day for previous metals, as gold has slipped 0.2% to US$4191 per ounce, and silver has seen a similar 0.2% drop to US$58.16 per ounce.
- And iron ore is trading down 0.8% to US$106.42 per tonne.
Trading Ideas:
- Bell Potter has maintained its hold rating on Cobram Estate Olives (ASX:CBO), after the company recently announced a $183m capital raising to fund the development of a further 1600 hectares of orchards in the US.
- And Trading Central have identified a bullish signal in Adairs Ltd (ASX:ADH), indicating that the price may rise from the close of $1.86 to the range of $2.03 to $2.07 over a period of 33 days, according to the standard principles of technical analysis.
US equities ended the trading week in the green, as all three industry benchmarks closed higher. The Dow Jones gained 0.22%, the S&P500 posted a four-day winning streak, closing 0.19% higher, putting the index about 0.7% off its intraday record. This was after the latest inflation data was announced, which may provide incentive for the Federal Reserve to lower interest rates this week.
European markets closed mostly in the red, however the German DAX managed to advance 0.6%, while France’s CAC dropped 0.09%, the FTSE100 down 0.45% and the STOXX600 closed flat. The euro zone GDP rate was also released, showing the economy grew 0.3% in the third quarter.
Locally, the ASX200 gained 0.24% over the week and closed 0.19% higher on Friday. On Friday, materials and financials were up the most, while consumer discretionary and energy weighed down on the market.
What to watch today:
- Our local market is set to drop at the open, with the SPI futures suggesting a 0.15% decline at the time of recording.
- Looking at commodities,
- Crude oil is up 0.69% at US$60.08 per barrel, holding at a two-week high, driven by geopolitical risk premium.
- Gold is trading flat at US$4,198.86 an ounce,
- And iron ore is down 0.59% at US$107.24 per tonne, while seaborne iron ore has dropped to a near four- week low, following the Simandou project in Guinea which has sent its first commercial shipment to China, which is creating a boost in global supply. This is expected to arrive in China by mid- January which will provide China with an alternative to dominant shipments from Australia and Brazil.
- And in economic news, investors are cautiously awaiting the next RBA cash rate decision which will be announced tomorrow.
Trading Ideas:
- Trading Central have identified a bullish signal in Tabcorp Holdings (ASX:TAH) indicating that the stock price may rise from the close of $0.94 to the range of $1.12 to $1.16 over 25 days.
- They have also identified a bearish signal in Supply Network (ASX:SNL) indicating that the stock price of fall from the close of $32.96 to the range of $28.90 - $29.70 over 15 days, according to the standard principles of technical analysis.
Emerging markets (EM) are positioned for continued out-performance of developed markets, driven by structural tailwinds and a rising middle class. With EM equities modestly valued and supported by a weaker US dollar, now is an attractive entry point. These markets offer exposure to transformative themes like AI, infrastructure development, and green energy transition. Bell Potter’s analysts share their ideal strategy for how to most effectively gain exposure to these markets, and capitalise on their high growth potential.
In this week’s video, Sophia covers:
- (0:20): an intro to Emerging Markets and what they are
- (0:43): factors behind the growth potential of Emerging Markets
- (2:10): Bell Potter’s ideal strategy to gain exposure
- (2:57): how the local market performed this week
- (3:55): the most traded stocks and ETFs this week
- (4:27): economic news items to look out for next week.
Kicking off in the US, Wall St extended its gains overnight after new jobs data was released which further increased the likelihood of a Fed rate cut next week. The S&P 500 gained 0.5%, the Nasdaq gained 0.4%, while the Dow Jones index added 1%.
Europe saw a mixed day on the markets – the broader Stoxx600 added 0.1%, as a 0.2% gain for the French CAC was offset by a 0.1% drop for both the FTSE and German DAX. And in Asia, the Chinese CSI saw a 0.5% drop, the Hang Seng fell 1.3%. while the Japanese Nikkei added 1.1%.
Locally yesterday, the ASX 200 closed up 0.2%, with 8 of the 11 key sectors in the green. The biggest story on the day was the release of GDP data, where it was announced that the economy had expanded by just 0.4%, below market consensus.
What to watch today:
- Looking ahead to today, the ASX 200 is expected to continue its winning streak, with the SPI futures indicating a 0.24% rise at the open of trade.
- Investors should also keep an eye on the balance of trade data, which is due at 11:30am Sydney time.
- Moving over to commodities:
- Crude oil is trading up 0.8% at US$59.11 per barrel.
- Precious metals remain steady – gold is up less than 0.1% to US$4208 per ounce, while silver is up just over 0.1% to US$58.50.
- Meanwhile iron ore is trading up another 0.4% at US$107.7 per tonne.
Trading ideas:
- Bell Potter maintains a speculative Buy rating on red hot medical stock 4D Medical (ASX:4DX), and upgraded its 12 month target price to $2.50 per share after they announced a major upgrade to their commercialization agreement with Phillips in the US and Canada yesterday.
- And Trading Central have identified a bullish signal in Telstra (ASX:TLS), indicating that the price may rise from the close of $4.91 per share to the range of $5.26 to $5.34 per share over a period of 119 days, according to the standard principles of technical analysis.
Overnight in the US Wall St rebounded from Monday’s drop as Cryptocurrency regained some of its losses, and investor confidence in an imminent Fed rate drop grows. The Dow Jones added 0.5%, the S&P500 gained 0.4%, while the Nasdaq was the biggest winner on the day, closing 0.8% in the green as tech stocks, especially those in the recently volatile AI trade, posted gains.
It was a relatively stable day across the other global markets – in Europe the Stoxx600 index rose just 0.06% as a 0.5% gain for Germany’s Dax was offset by a 0.3% drop for the French CAC, while the British FTSE ended flat. Meanwhile in Asia, China’s CSI fell 0.5%, Hong Kong’s Hang Seng gained 0.2%, while Japan’s Nikkei ended flat.
Back in Australia yesterday, the ASX 200 posted a 0.2% gain, propelled mainly by a strong day for energy and materials. Major players in the energy space Woodside (ASX:WDS), Santos (ASX:STO) and Beach Energy (ASX:BPT) all added 1% on yesterday’s trade, while materials were lead by BHP (ASX:BHP), Fortescue (ASX:FMG) and Rio Tinto (ASX:RIO), which all posted gains of over 1%.
What to watch today:
- And the SPI futures indicate that the momentum will continue, suggesting a 0.17% rise at the open of trade today.
- Investors should also keep an eye on key economic data being released today, specifically the GDP figures which are due at 11:30am Sydney time.
-
Moving into commodities:
- Crude Oil continues to be volatile, trading down 1.2% to US$58.60 per barrel. The Russia-Ukraine conflict continues to stay front and centre, as uncertainties around the peace plan remain.
- In precious metals, Gold has retreated slightly, trading 0.5% lower at US$4208 per ounce, while Silver continues to advance, trading 0.9% higher at US$58.53 per ounce.
- And Iron ore is trading 0.4% higher at US$107.35 per tonne.
Trading Ideas:
- Finally, we’ll end on some trading ideas for your consideration today. Bell Potter have initiated coverage on specialist retailer of lighting, fans and electrical accessories Beacon Lighting (ASX:BLX), with a 12-month target price of $3.35 per share. They expect that its trade business, which currently makes up around 40% of its revenue, will continue to expand over the next 2-3 years.
- And Trading Central have identified a bullish signal in Rio Tinto (ASX:RIO), indicating that the share price may rise from the closing price of $135 per share, to the range of $142 to $143.50 per share over a period of 23 days, according to the standard principles of technical analysis.
Wall St kicked off the festive season with a slide in the first trading session of December, as a broad Cryptocurrency sell off dented general investor sentiment. Flagship currency Bitcoin slumped over 6% to below US$86,000, adding to the over 30% drop in price experienced over the last 2 months from highs of $125,000 in October. The S&P 500 fell 0.4%, the Dow Jones lost 0.7%, and the Nasdaq shed 0.4%.
It was a relatively stable day across the European markets, with the exception of Germany, where the DAX slid over 1% after monthly manufacturing data came in at a 9-month low, sparking a sell off. Asia saw a mixed day as the Chinese CSI and Hong Kong’s Hang Seng added 1.1% and 0.7% respectively, while the Japanese Nikkei slid 1.9%.
Locally yesterday, the ASX 200 retreated 0.6%, with 8 of the 11 key sectors posting losses. The biggest story on the day however was a technical outage which prevented the ASX from publishing market-sensitive announcements for over 3 hours, causing around 80 companies to be put into a trading halt.
What to watch today:
- The SPI futures indicate that the ASX 200 will edge slightly up, with a 0.07% gain at the open of trade today.
- In commodities:
- Crude Oil prices are trading up another 1.5% at US$59.45, as Ukraine launched a fresh wave of Drone attacks on Russia denting the potential for peace talks, and OPEC announced its decision to leave output levels unchanged in Q1 2026.
- Onto precious metals, gold has continued its recent rally and is now trading at a 6-week high US$4,240 per ounce. Meanwhile, Silver is trading just under 3% higher at US$58 per ounce, setting a fresh all-time high in the process. Today’s increase means that the silver price has now hit a 100% year-on-year rise, outpacing Gold.
- And finally Iron Ore prices have increased by 2% to just under US$107 per tonne, driven by Chinese demand and a weaker US dollar.
Trading ideas:
- And now we’ll end on some trading ideas for your consideration today. Bell Potter have maintained their Buy rating on healthcare equipment provider Paragon Care (ASX:PGC) with a target price of $0.49 per share, after the company announced the acquisition of Indonesian based provider Haju Medical – expanding their presence into overseas markets.
- And Trading Central have identified a bullish signal in South32 (ASX:S32), indicating that the price may rise from the close of $3.31 to the range of $3.95 to $4.05 over a period of 45 days, according to the standard principles of technical analysis.
Wall Street closed in the green on Friday, climbing to near record highs in a shorten session for Thanksgiving, with retail gains and as tech stocks recovered. However, global futures markets fluctuated on Friday following a CME outage, which is the world’s largest trading operator. This halted trading in stocks, bonds and commodities. The Dow Jones closed with a 0.6% gain, the S&P500 up 0.54% and the Nasdaq rebounded, closing 0.65% higher.
European markets also ended the week in the green. All European markets closed just over 0.2% higher, and the STOXX600 advanced 0.25%.
What to watch today:
- Following a strong end to the week across global markets, the SPI futures are suggesting our local market will rise 0.05% at the open this morning.
- Keep watch of Metacash (ASX:MTS) share price movements today, with then wholesale distributor set to release its first half results for FY26.
- In commodities,
- Crude oil is trading 1.35% higher at US$59.44 per barrel, however, has been pressured by oversupply concerns and posted a monthly loss. So, keep watch of ASX- listed energy producers.
- Gold is trading 1.4% higher at US$4,217.81 per ounce, reaching a fourth straight monthly gain markets priced a higher probability for a December Federal Reserve rate cut.
- And iron ore is trading steady at US$104.84.
- And AUD$1.00 is currently buying US$0.65.
Trading Ideas:
- Bell Potter maintains their buy rating on HUB24 (ASX:HUB) and have lowered their price target from $135 to $125. At HUB’s current share price of $104.38, this implies 19.8% share price growth in a year.
- And Trading Central have identified a bullish signal in Ramelius Resources (ASX:RMS) indicating that the stock price may rise form the close of $3.66 to the range of $4.20 to $4.30 over 17 days, according to the standard principles of technical analysis.
After an impressive 83% of S&P500 companies beat their earnings forecasts, what is next for US equities? The US market has picked up steam again, spurred by strong Q3 results and solid performance in the high-flying AI sector, while financials also proved a standout performer. Bell Potter’s analysts share their views on where the rally is headed, their outlook for the medium term, and factors impacting the market to look out for.
In this week’s wrap, Sophia covers:
- (0:18): an overview of US third quarter earnings
- (1:05): how the AI sector is showing return on investment
- (1:57): Bell Potter’s outlook for the US market
- (2:20): how the local market performed this week
- (3:29): the most traded stocks and ETFs this week
- (4:04): economic news items to look out for next week.
Overnight in the US, Wall St posted its 4th consecutive day of gains, with all 3 of the major indexes closing in the green. The Dow Jones climbed 0.8%, the S&P500 climbed 0.9%, while the Nasdaq saw the biggest wins of the day, advancing 1%. The S&P500 and Dow Jones are both up around 3% this week, putting them on pace for their best weeks since late June, while the Nasdaq has advanced more than 4%, giving it its best week since mid May.
European markets saw similar gains – the pan European Stoxx600 index closed up over 1%, spurred by a 0.9% gain for the UK’s FTSE, a 1.1% gain for Germany’s DAX, and a 0.9% gain for the French CAC. And Asian markets too followed suit, with the Chinese CSI gaining 0.6%, Hong Kong’s Hang Send gaining 0.13%, and the Japanese Nikkei jumping 1.85%.
It was no different back home in Australia, as yesterday the ASX 200 closed up 0.81%, with 8 of the 11 key sectors posting gains. The market was trading up as high as 1.2%, however the release of hotter than expected CPI data dented the rally somewhat, as chances of the RBA lowering the cash rate become substantially slimmer.
The materials sector was once again in the lead, with big names BHP (ASX:BHP) and Rio Tinto (ASX:RIO) posting gains of over 1%.
In notable stock news, furniture maker Temple and Webster (ASX:TPW) shares plummeted 32% after the company reported results that were well short of expectations.
What to watch today:
- Focusing on today, the SPI futures indicate that the ASX will continue its winning streak, predicting a 0.26% rise at the open of trade.
- Moving to commodities,
- Crude Oil prices settled up 1.1% after they had hit their lowest point in a month in the previous session. It is currently trading at US$58.56 per barrel.
- In precious metals, Gold is trading up 0.78% higher at US$4163 per ounce, while silver has jumped 3 and a half percent to US$53.62 per ounce, hitting a two week high.
- And Iron ore once again remains mostly flat at $104.63 per tonne.
Trading ideas:
- Finally, we’ll end on some trading ideas for your consideration today. Bell Potter has maintained its Buy rating on almond grower and processor Select Harvests (ASX:SHV), and increased its 12 month price target to $5.80 per share, after the company reported an 18% increase in YoY revenue, and a 63% increase in operating EBITDA.
- And Trading Central have identified a bullish signal in gambling company Tabcorp Holdings (ASX:TAH), indicating that the price may rise from the close of $0.92 per share to the range of $1.09 to $1.13 per share over a period of 18 days, according to the standard principles of technical analysis.
Starting in the US, Wall St maintained its rally as investors’ optimism for a further rate cut in December continues to grow. It is estimated that there is now around an 80% chance of a rate cut in December, sparking hopes for a continued rally into the final month of the year. The Dow Jones gained 1.43%, the S&P500 gained 0.94%, while the Nasdaq posted a 0.67% gain, as an all time high for Google parent company Alphabet was offset by a 2.6% drop for Nvidia.
Europe and Asia saw similar rallies, breaking the previous trends of volatility with a sea of green across the major indexes. In Europe, the UK’s FTSE, German DAX and French CAC posted gains of 0.78%, 0.97% and 0.83% - all contributing to the pan-European Stoxx 600 advancing 0.91%. And in Asia, the Chinese CSI advanced 0.95%, Hong Kong’s Hang Seng advanced 0.69%, while the Japanese Nikkei edged 0.07% higher.
Back locally, the ASX ended Tuesday’s trading session 0.14% in the green, with 5 of the 11 key sectors posting gains. Materials were the biggest winner, mainly driven by gold miners and iron ore producers which saw solid gains on the day. Some notable stocks include Northern Star (ASX:NST) which gained 1.98%, Newmont Corporation (ASX:NEM), which jumped 4.63% and Fortescue (ASX:FMG), which gained 2.74%. On the other end, it was another tough day for financials as the big banks saw losses extended – lead by CommBank (ASX:CBA) slipping 1.17%.
In other stock news, DroneShield (ASX:DRO) ended its torrid run of late with a 14.61% surge on the day, after the company announced a new $5.2 million contract to supply an unnamed European military.
What to watch today:
- Looking ahead, the SPI futures indicate the ASX will follow Wall St, predicting a 1.13% rise at the open of trade today.
- Investors can also expect the release of the monthly CPI data at 11:30am Sydney time, which will provide further insight into the state of the Australian economy and may impact the share market.
- Moving over to commodities:
- Crude Oil has continued to slip with a further 1.43% decline in the price to US$58 per barrel, mainly driven by continuing uncertainty on the outcome of peace talks in the Russia-Ukraine conflict.
- Precious metals saw a stable day in terms of price, as Gold and Silver are both trading nearly flat at US$4130 and US$51.37 per ounce respectively.
- And it was a similar story for Iron Ore, which remains flat at US$104.50 per tonne.
Trading Ideas:
- Finally, we’ll end on some trading ideas for your consideration today. Bell Potter has maintained its Buy rating on electrical equipment provider IPD Group (ASX:IPG), after the company reported Q1 and Q2 FY2026 EBITDA and EBIT guidance exceeding consensus expectations, indicating a solid upwards trajectory.
- And Trading Central have identified a bullish signal in gold miner Ramelius Resources (ASX:RMS), indicating that the stock price may rise from the close of $3.56 to the range of $4.40 to $4.70 over a period of 27 days, according to the standard principles of technical analysis.
Starting in the US, overnight Wall St continued its rebound sparked by a revival of the AI trade, with gains primarily lead by Google parent company Alphabet. The S&P 500 increased by 1.59%, the Dow Jones gained 0.44%, while the Nasdaq jumped 2.69%, as other big tech names such as Broadcom, Palantir, AMD and Nvidia all followed Alphabet’s lead and posted gains.
Across other international markets, it was a mixed bag of results. In Europe, the broad Stoxx 600 edged slightly up 0.14%, as a 0.64% gain in Germany’s DAX was offset by declines of 0.05% for the British FTSE, and 0.29% for the French CAC.
And in Asia, Hong Kong’s Hang Seng posted gains of 1.97%, while the Chinese CSI fell 0.12%, and the Japanese Nikkei saw a 2.4% drop.
Back home in Australia, the ASX 200 opened the trading week by advancing 1.29%, earning back some of the over 2.5% drop seen last week. 10 of the 11 key sectors posted gains, with the energy index the sole outlier. Notably the information technology sector, which has been hammered in recent trading sessions, saw a 2.39% advance, spurred by a 7.1% gain for Life 360 (ASX:360).
Fertility services provider Monash IVF (ASX:MVF) saw its share price skyrocket up 44% after it rejected a $312 million takeover offer, sparking optimism for the long-term valuation of the company.
What to watch today:
- And now looking ahead to today, the SPI futures indicate that the recent rally will continue, predicting a 0.53% jump at the open of trade today.
- Moving to commodities, Crude Oil is trading up 1.55% at USD58.96 per barrel, as investors react to increased bets of a US interest rate cut in December, and growing uncertainty over a peace deal in the Russia – Ukraine conflict.
- In precious metals, both Gold and Silver are trading higher on the release of fresh economic data out of the US – Gold is up 1.73% to USD4132 per ounce, while Silver has jumped 2.7% to USD51.35 per ounce.
- And Iron Ore remains nearly flat at USD104.42 per tonne.
Trading Ideas:
- Finally, we’ll end on some trading ideas for your consideration today. Bell Potter have upgraded their recommendation on mineral assaying provider Chrysos Corporation (ASX:C79) from a hold to a buy, with a 12-month price target of $9.40 per share. This comes after the company posted a 54% increase in YoY revenue, and a strong pickup in adoption globally.
- And Trading Central have identified a bullish signal in GPT Group (ASX:GPT), indicating that the price may rise from the close of $5.68 per share to the range of $6.10 to $6.25 per share over a period of 55 days, according to the standard principles of technical analysis.
US equities ended the trading week with a strong rebound. All three industry benchmarks closed in the green on Friday. The Dow Jones up 1.08%, the S&P500 up 0.98% and the tech heavy Nasdaq up 0.88%. This rebound came after New York Federal Reserve President John Williams suggested the central bank could cut interest rates yet again this year.
European markets closed mixed amid global volatility. The German DAX was down 0.8% while France’s CAC was slightly higher, just 0.2%. The FTSE100 gained 0.13% while the STOXX600 ended 0.33% lower.
Locally the ASX200 ended the week down 2.52% and on Friday closed 1.59% after a touch week in Australian and US markets.
What to watch today:
- However following the US rebound, our local market is set to rise 1.09% at the open this morning, according to the SPI futures.
- Also on watch today will be the share price movements of Pro Medicus (ASX:PME) as the health imaging company holds its AGM and are set to provide a trading update.
- In commodities,
- Crude oil has dropped 1.59%, to US$58.06 per barrel the lowest in one month, after President Volodymyr Zelenskiy signaled a willingness to pursue peace talks, so keep watch of ASX listed energy producers today.
- Gold is trading 0.3% lower at US$4,063.98 an ounce, as markets digested stronger US labour data, dovish central bank signals and softer US yields.
- And iron ore is trading flat at U$104.26 per tonne.
Trading ideas:
- Bell Potter maintain a buy rating on WiseTech Global (ASX:WTC), noting the stock could offer more than 50% upside over the next year. They have lowered their price target to $100.00, stating that in FY26 they now forecast revenue and EBITDA of US$1.40bn and US$569m which is towards the lower end of the guidance range for the former and close to the middle for the latter. They see more risk at revenue than EBITDA this year, particularly with the greater-than-usual revenue skew to H2. At the current share price of $65.76 this implies 52.1% share price growth in a year.
- And Trading Central have identified a bearish signal in NexGen Energy (ASX:NXG) indicating that the price may fall from the close of $11.82 to the range of $9.10 to $9.60 over 22 days, according to the standard principles of technical analysis.
The ASX200 rebounded this week after Nvidia’s strong results eased fears of an AI-driven tech correction. Local wage data also helped steady sentiment, showing a cooler labour market without shifting rate expectations. Staples remain solid, while discretionary names are showing fresh momentum, prompting Bell Potter to rotate toward leaders like Woolworths (ASX:WOW), Endeavour (ASX:EDV), Bega Cheese (ASX:BGA) and Accent Group (ASX:AX1).
In this week’s wrap, Sophia covers:
- (0:10): what was behind the ASX’s slump
- (1:04): the impact of domestic economic data on the market trajectory
- (3:13): stocks Bell Potter’s analysts favour at the moment
- (4:09): how the local market performed this week
- (5:07): the most traded stocks and ETFs this week
- (5:36): economic news items to look out for next week.
In the US overnight, Wall St rebounded after a 4 day losing streak with all 3 major indexes closing in the green. The S&P 500 gained 0.5%, while the Dow Jones edged 0.1% higher, and the Nasdaq advanced 0.8%, driven by a new all time high for Google parent company Alphabet, as well as a 3% gain for Nvidia ahead of its pivotal earnings release this morning.
Markets across Europe were mainly down – the broader European Stoxx 600 Index edged less than 0.1% down, while the German DAX fell 0.1%, the French CAC 0.2%, and the British FTSE was the biggest slider, shedding 0.47%.
In Asia, China’s CSI gained 0.44%, but the other major markets all slid, including Hong Kong’s Hang Seng retreating 0.38%, and Japan’s Nikkei losing 0.34%.
Locally yesterday, the ASX 200 extended Tuesday’s rout with a further 0.25% slide, dropping the index to its lowest point in 6 months. Strong gains in materials, which were lead by the gold miners, were offset by a tough day for financials, as major banks including CommBank (ASX:CBA), Westpac (ASX:WBC) and Macquarie (ASX:MQG) all slid more than 1%, while ANZ (ASX:ANZ) fell 2%.
In other major stock news, popular defence pick DroneShield (ASX:DRO) continued its tumultuous run from the last few weeks after it was announced that its US chief executive Matt McCrann resigned effective immediately, prompting a further 19% loss. After hitting peaks of over $6.50 per share as recently as October, the stock closed trading at less than $2 per share yesterday.
What to watch today:
- The SPI futures indicate that the ASX will snap its losing streak and regain some of its recent losses, predicting a 0.63% jump at the open.
- Over to commodities, Crude Oil has dropped over 2% to US$59.50 per barrel, after reports indicated that the US government is renewing its efforts to end the ongoing Russia-Ukraine conflict. In theory, this would reduce supply risks to Russian oil, which in turn caused the price to drop.
- In precious metals, Gold is trading more or less flat at US$4074 per ounce, while silver has gained just over a percent and is trading at US$52.21 per ounce.
- And Iron ore remains just about flat at US$104.26 per tonne.
Trading ideas:
- Bell Potter has maintained its Buy rating on agricultural chemicals supplier Nufarm (ASX:NUF), and upgraded its 12-month target price from $3.55 per share to $3.60 per share, after the company reported FY25 underlying EBITDA slightly ahead of expectations, and upgraded its FY26 guidance.
- And Trading Central have identified a bullish signal in ResMed (ASX:RMD), indicating that the price may rise from the close of $37.98 per share, to the range of $43.50 to $44.75 per share over a period of 29 days, according to the standard principles of technical analysis.
Yesterday we saw another tough day in the markets across the board, continuing trends we have seen emerging so far this month. Starting in the US, it was another day of sliding for all 3 major indexes – The Dow Jones lost 1.07%, the Nasdaq lost 1.2%, while the S&P500 slid 0.8%, to mark its biggest losing streak since August.
The pullback comes as 2 critical results come out later this week – Nvidia’s Q3 earnings, and the US September jobs report – demonstrating how overevaluation of the tech sector, and the more general state of the US economy remain the most important issues for investors at the moment.
We saw similar results across Europe, with major declines across the major markets. The Stoxx600, French CAC, German DAX and British FTSE all slid more than 1% in overnight trade. Meanwhile in Asia, losses were more pronounced, as Hong Kong’s Hang Seng slid 1.7%, while the Japanese Nikkei recorded a 3.22% decline.
And back home in Australia it was no different, as the ASX 200 fell just under 2% to record its second worst individual day of 2025, only behind Trump’s Liberation Day in April when sweeping tariffs were announced. All 11 key sectors posted losses, with materials and technology hit the hardest – the latter with a nearly 6% loss on the day.
TechnologyOne (ASX:TNE), dragged down the technology sector the most, plummeting 17% after reporting revenue which fell short off expectations, and declining to provide FY26 guidance. In materials, Northern Star (ASX:NST) closed trading down 5.6%, as expectations of a US rate cut continue to shrink.
What to watch today:
- Looking ahead to today’s trading, the ASX is set to extend yesterday’s losses, with the SPI futures predicting a 0.2% drop at the open.
- In commodities, Crude Oil is trading 1.2% higher at 60.6USD per barrel, as US sanctions placed on Russia in October are beginning to curb their export volumes.
- In precious metals, Gold is trading 0.5% higher at 4066USD per ounce, while Silver is up 1% at 50.7USD per ounce.
- And Iron ore is trading nearly flat at 104USD per tonne.
Trading Ideas:
- Bell Potter has maintained its Buy rating on testing, inspection and certification company ALS (ASX:ALQ), and raised its target price by 10% to $25 per share, after the company reported results that beat forecast, and upgraded its FY2026 guidance.
- And Trading Central have identified a bearish signal on Westpac (ASX:WBC), indicating that the price may fall from the close of $37.87 per share, to the range of $34.60 to $35.20 per share over a period of 35 days, according to the standard principles of technical analysis.
Wall St saw a pullback to open this week, with the losses once again lead by the recently struggling tech sector. The Dow Jones lost 1.2%, the S&P500 dropped 1% while the Nasdaq slipped 0.9%. Nvidia was a big factor weighing down the market, dropping 3% ahead of its Q3 results which are scheduled for Thursday morning Sydney time, as investors remain anxious about stretched evaluations. The results are expected to shape the trajectory of the entire sector for the next few weeks.
In other overseas markets, Europe and Asia saw similar results to the US, with a sea of red across all the major indexes, including the European Stoxx600, Chinese CSI and Hong Kong’s Hang Seng which all dropped over half a percent.
Locally yesterday, the ASX technically did buck the global trend and close in the green, although it was only 1.9 points or 0.02% up. This result did however ensure that the ASX avoided what would have been its longest losing streak since June, had it closed down again.
What to watch today:
- Today however, the ASX is expected to follow the slip we saw abroad overnight, with the SPI futures indicating a 0.6% drop at the open.
- Crude Oil is trading down 0.64% at 59 USD and 71 cents per barrel
- Precious metals have also seen similar drops, with gold down 1% to 4042USD per ounce, and silver down 0.76% to 50USD per ounce.
- Iron ore is trading up 0.45% at 104.42USD per tonne.
Trading ideas:
- Bell Potter has maintained its Buy rating on agricultural chemicals supplier Elders (ASX:ELD) with a 12-month price target of $9.45, after the company reported strong results and positive guidance for FY26.
- And Trading Central have identified a Bearish signal in Aussie Broadband Ltd (ASX:ABB), indicating that the price may fall from the close of $5.51 to the range of $4.80 to $4.95 over a period of 60 days, according to the standard principles of technical analysis.
Well it was another mixed session on Walk Street to end the trading week. The S&P500 continued to fall with the High Beta segment down the most, while Energy held up the most among the S&P large cap segments. On Friday the S&P500 closed 0.05% in the red, the Dow Jones 0.65% in the ted, while the Nasdaq gained 0.13%, regaining losses after coming under pressure recently. Nvidia’s earnings are also out on Wednesday, so investors will be watching out for that.
European markets were all in the red as concerns around artificial intelligence stocks continue. The German DAX down 0.69%, France’s CAC down 0.76%, FTSE100 1.11% lower, and the STOXX600 down 1.01%.
On Friday our local market closed 1.54% lower over the week and 1.36% lower for the day, hitting a 4-month low. Losses were wide spread, however tech stocks dragged down the market the most on Friday, with the sector heavily falling 4.32%. A few key factors weighing down on the maker last week included hotter than expected jobs report which came out on Thursday, which slashed expectations for rate cuts this year. We also know that key monthly data on US inflation might not be released for the month due to the shutdown US. And weak economic data was released from China as well.However it’s important to note that YTD number for the Australian and US market are still positive.
What to watch today:
- The SPI futures are suggesting the local market will drop 0.2% at the open this morning.
- Elders (ASX:ELD) shares will be on watch today when the agribusiness company releases its FY 2025 results.
-
In commodities:
- We’ll keep watch of energy producers today, such as Woodside Energy (ASX:WDS) or Santos (ASX:STO) as oil prices pushed high on Friday, driven by news that a Russian port has suspended oil exports falling an attack. Crude oil is up 2.4% to US$60.09 per barrel.
- Meanwhile, gold has dropped over 2% now at US$4083.60 an ounce, though the metal remained on track for a weekly advance of roughly 3%. The market continued to grapple with uncertainty stemming from a significant backlog of US economic data following the end of the longest government shutdown in the country’s history.
- And iron ore has dropped slightly, to US$103.95 per tonne.
Trading Ideas:
- Bell Potter have a buy rating on medical device company Aroa Biosurgery (ASX:ARX) with a price target of $0.85. At the current share price of $0.72 this implies 18% share price growth in a year.
- And Trading Central have identified a bearish signal in NAB (ASX:NAB), indicating that the stock price of $41.48 nay fall to the range of $38.70 - $39.30, over 52 days according to the standard principles of technical analysis.
From copper’s new “critical mineral” designation to major investment in Australian iron ore, markets were driven by shifting supply dynamics this week. Precious metals surged as the gold-silver ratio tightened, hinting at improving industrial sentiment, while oil prices weakened after OPEC projected a more balanced market ahead. Together, these moves underline how future supply and the global energy transition are shaping commodity pricing.
In this week’s wrap, Sophia covers:
- (0:26): copper’s new designation in the US and what it means
- (2:00): gold and silver back in the spotlight
- (3:08): why oil prices have slumped on supply reports
- (3:43): how the local market performed this week
- (4:36): the most traded stocks and ETFs this week
- (5:03): economic news items to look out for next week.
Overnight in the US, Wall St saw a very similar trading day to yesterday’s, with the Dow Jones advancing 0.7% to reset its record, while the Nasdaq slipped a further 0.3%, lead once again by reevaluations in the high flying AI sector. The S&P500 meanwhile edged 0.2% higher on the day.
Across the pond Europe’s strong momentum continued with another day of solid gains. The Stoxx 600 index closed up 0.71%, drive primarily by Germany’s DAX and the French CAC, which added 1.22 and 1.04% respectively. The FTSE lagged behind, only edging up 0.1% higher.
Asia saw a mixed session, as the Hang Seng and Nikkei added 0.85% and 0.43% respectively, while China’s CSI index closed down 0.1%.
Locally yesterday, the ASX saw its second straight day of the market opening higher, but ending the day in the red. The ASX 200 slipped 0.22%, despite 6 of the 11 key sectors in the green.
Mineral Resources (ASX:MIN) was the biggest winner, with investors impressed by the announcement of a new deal with South Korea’s POSCO to sell a 30% stake in its lithium operations for 765 million USD.
On the losing end, popular tech stock Life360 (ASX:360) tumbled 13% after reporting lower than expected user growth numbers, and Commonwealth Bank (ASX:CBA) slipped a further 3% after yesterdays sell off as investors continue to weigh the disappointing results.
What to watch today:
- Looking ahead to today, the SPI futures indicate that the ASX will open slightly higher, with a 0.12% gain.
- In precious metals, Gold and Silver continue to extend their recent rallies, with gold up a further 1.7% to just under $4200 USD per ounce, while silver is trading another 4.1% higher at 53 USD and 30 cents per ounce.
- Meanwhile, Crude Oil prices have plummeted nearly 4 and a half percent down to 58 USD and 40 cents per barrel, after a recent OPEC report suggested that global oil supply is expected to match demand in 2026, marking a shift from previous forecasts which had predicted a supply deficit.
- And Iron ore is trading up 0.6% to 104USD and 17 cents per tonne.
Trading ideas:
- Bell Potter has maintained its buy rating on gaming machines supplier Aristocrat Leisure (ASX:ALL) and increased its 12-month price target to $80 per share, based on its forecasted NPAT and EBIT growth from ongoing R&D projects.
- And Trading Central have identified a bullish signal in Regis Resources (ASX:RRL), indicating that the price may rise from the close of $6.88 per share, to the range of $7.40 to $7.60 per share over a period of just 17 days, according to the standard principles of technical analysis.
In the US, Wall St saw a mixed session overnight, with the Dow Jones closing up 1.18% to set a fresh record high, while the Nasdaq slipped 0.25% as volatility in the AI sector continues. Nvidia pulled back 2% from yesterday’s rally on news that Japanese investment holding company SoftBank had sold its entire 5.8 billion USD stake in the company. Meanwhile, the S&P 500 also saw gains overnight, adding 0.21%.
In Europe, markets across the continent carried their momentum from yesterday as optimism following the end of the US government shutdown continued. The pan European Stoxx 600 index closed up 1.3%, as the FTSE and French CAC saw gains of over 1%, while the German DAX was slightly behind, only advancing half a percent.
Back home yesterday, despite opening in the green and seeing 8 of the 11 key sectors positive, the ASX 200 declined 0.2% on the day. It was primarily weighed down by the financial sector, where the big story was Commonwealth Bank (ASX:CBA) shares tumbling 6.6%, after the bank reported higher net interest margin and cost pressure than expected.
What to watch today:
- Looking ahead to today’s trading session, the SPI futures indicate that the ASX will open up 0.2%.
- Both gold and silver have continued to rally, bringing them now to a 5% and 8.5% advance on the week so far respectively. Gold is currently trading at 4129USD per ounce, while silver is at 51USD per ounce.
- Crude oil is trading 1.5% higher at nearly 61 USD per barrel, as the US recently announced fresh sanctions on Russian oil along with optimism on the impending end of the government shutdown.
- Iron ore is down 0.4% at 103 UD and 56 cents per tonne.
Trading ideas:
- Bell Potter has upgraded its recommendation on pharmaceutical giant Pro Medicus (ASX:PME) from a hold to a buy, with a 12 month target price of $320 per share, based on its baseline revenue forecast along with the announcement of 3 new major deals in the US.
- And Trading Central have identified a bullish signal in pathology services provider Australian Clinical Labs (ASX:ACL), indicating that the price may rise from the close of $2.64 to the range of $2.99 to $3.07 over a period of 12 days, according to the standard principles of technical analysis.
In the US overnight, investors were buoyed by renewed optimism following news that 8 Democratic senators broke from party leadership and voted to end the Government shutdown, which has been running now since the 1st of October. Wall St responded with strong gains – the Dow Jones advanced 0.9%, the S&P 500 gained 1.6%, while the Nasdaq saw a 2.3% jump, lead by strong rallies across the tech megacap stocks.
Europe and Asia saw similar trends to the US, with a sea of green across all the major markets. In Europe, the British, German and French indexes all advanced more than 1%, while in Asia the Chinese CSI, Japanese Nikkei and Hong Kong Hang Seng gained 0.35, 1.26 and 1.55% respectively.
Locally yesterday, the ASX opened the week on a positive note, advancing 0.8% in its strongest day in a month. 9 out of the 11 key sectors closed in the green, lead by a strong rebound in Information Technology, which has been hit particularly hard in recent trading days. Notable stocks in the sector include Life360 (ASX:360) which advanced 3.6%, and WiseTech Global (ASX:WTC), which rebounded 6.2%.
What to watch today:
- And looking ahead to today, yesterday’s positive momentum is expected to continue, with the SPI futures indicating a further 0.5% jump for the ASX at the open.
- In commodities, the price of both Gold and Silver have surged as investors react to soft economic data coming out of the US and increased belief that a further rate cut will come from the Fed in December. Gold is up 2.8% to 4114 USD per ounce, while Silver is up 4.3% to 50.5USD per ounce. Meanwhile, Crude Oil is trading up 0.7% at 60.1 USD per barrel, while Iron Ore is trading up 0.6% to 104 USD per tonne.
Trading Ideas:
- Bell Potter has upgraded its rating on Western NSW based copper and gold miner Aeris Resources (ASX:AIS) from a hold to a buy, with a target price of $0.65 per share. This comes on a trio of big announcements which are catalysts for future growth: an $80m equity raise, discovery of a maiden ore reserve at one of its key sites, and the sale of some small scale copper assets.
- And trading central have identified a bullish signal on Regis Resources (ASX:RRL), indicating that the price may rise from the close of $6.70 per share, to the range of $7.40 to $7.60 per share over a period of 16 days, according to the standard principles of technical analysis.
Wall Street ended the trading week mixed, as Tesla and artificial intelligence stocks put pressure on the Nasdaq. The Nasdaq closed 0.22% in the red, while the Dow Jones and S&P500 gained 0.16% and 0.13% respectively.
European markets were all in the red, amid concerns around artificial intelligence valuations. The STOXX600 closed 0.6% lower.
On Friday the ASX200 closed 0.66% in the red, with information technology and financials dragging down the market the most. Five of the eleven industry sectors were in the red.
What to watch today:
- However, our local market is set to regain some of those losses, with the SPI futures suggesting a 0.26% gain at the open this morning, amid investor optimism that a US government budget will end the government shutdown.
- Investors will also be watching ANZ Group (ASX:ANZ)today, set to release it’s full year results today. Macquarie analysts are expecting ANZ to report operating income of $22.3 billion, operating expenses of $12.74 billion, and cash earnings of $6.383 billion, in line with the consensus estimate.
- Looking at commodities:
- Crude oil is ending the trading week up 0.54%, regaining some of the week’s loses, however overall, posted the second weekly loss as fears of a potential oversupply ccontinued to weigh on the market. OPEC+ output increased last month as key members resumed halted production, while non-OPEC producers also ramped up supply. In response, Saudi Arabia, the world’s largest oil exporter, slashed its December crude prices for Asian buyers.
- Meanwhile, Gold has climbed 0.6% to US$4,000.98, supported by soft US economic data that fuelled expectations that the Fed could lower interest rates in December.
- And iron ore reached the lowest in four months, amid poor demand. Steel exports out of China, the world's top producer, fell by more than 12% from the previous year. Despite this, iron ore imports were 10.2% higher reflecting the downward pressure on global demand for Chinese steel.
Trading ideas:
- Bell Potter maintains their Buy rating on REA Group (ASX:REA) following a mixed quarterly update from the online property services business. REA operated online property advertising, property-related services and financial services, which includes leading residential property website realeastate.com.au. Bell Potter have reduced their price target from $256.00 to $244.00, and at the current share price of $209.20, this implied 16.6% share price growth in a year.
- And Trading Central have identified a bullish signal in Metcash (ASX:MTS) indicating that the stock price may rise from the close of $3.92 to the range of $4.04 - $4.08 over 32 days, according to the standard principles of technical analysis.
Volatility remains high, but the local market continues to hold firm. October brought a mix of global rate cuts, easing geopolitical tensions, and steady domestic data, keeping investors cautious but optimistic. With the RBA likely to stay on hold until 2026 and small-caps leading the way, selective investing remains key as markets balance risk and resilience.
In this week’s wrap, Sophia covers:
- (1:10): factors from abroad - the US economy and geopolitical landscape
- (1:40): domestic news and its impact on the market
- (2:53): key risks to watch looking forward
- (3:24): how the local market performed over the last trading week
- (4:11): the most traded stocks and ETFs this week
- (4:52): economic news items to look out for next week.
Wall St rebounded overnight from yesterday’s sell off with all three of the major indexes closing in the green. The Dow Jones added 0.48%, the S&P500 gained 0.6%, while the Nasdaq rebounded the most, up 0.9%. The AI sector which was hit particularly hard yesterday recovered a lot of ground lead by AMD, which posted strong third quarter earnings and beat guidance.
European markets saw a similar rebound, with advances across the board. The pan-European Stoxx600 closed up 0.23%, the UK’s FTSE gained 0.64%, the German DAX advanced 0.42% and the French CAC added 0.1%.
Locally yesterday, the ASX closed down 0.1%, marking its 6 day of losses in the last 7 trading days. Materials were the main sector weighing down the market, with big names seeing losses across the board. Fortescue (ASX:FMG) and Rio Tinto (ASX:RIO) slipped 2.5% and 1.2% respectively, while in Gold Ramelius Resources (ASX:RMS) and Capricorn Metals (ASX:CMM) also saw declines of over 1%.
Popular defence stock DroneShield (ASX:DRO) tumbled 7.5% yesterday on news that it had vested more than 40 million performance options to employees upon hitting key revenue targets.
What to watch today:
- Looking ahead to today, following overseas trends the SPI futures indicate that the ASX will rebound from recent losses with a 0.75% jump at the open.
- In commodities, Crude Oil is trading down a further 1.5% at 59.65USD per barrel, Gold and Silver have both rebounded 1.3% and 1.9% respectively to 3983USD and 48USD per ounce, and Iron Ore is up 0.2% to 104.73USD per tonne.
Trading Ideas:
- Bell Potter have maintained their Buy rating on integrated marketing communications provide IVE Group (ASX:IGL), and increased their 12 month target price to $3.25 after the company announced two new business acquisitions and a marketing services agreement, with the impact of which expected to hit over the next 12 months.
- And Trading Central have identified a bullish signal in Woodside Energy Group (ASX:WDS), indicating that the price may rise from the close of $25.16 to the range of $27.10 to $27.50 over a period of 35 days, according to the standard principles of technical analysis.
Overnight in the US Wall St was a sea of red as all 3 major indexes saw sizeable declines. The Dow Jones fared the best, falling 0.53%, while the S&P500 retreated 1.17%, and the Nasdaq was hit the hardest, closing down 2.04%. The AI sector remains the most in focus as investors continue to be concerned that valuations far outweigh fundamentals - big names such as Oracle, AMD, Nvidia and Amazon all pulled back, while Palantir shares dropped 9% after releasing its quarterly results despite beating guidance.
Both Europe and Asia saw similar trends overnight, as the majority of the major markets closed in the red. In Europe, the German DAX and French CAC fell 0.76% and 0.52%, although the UK’s FTSE was the exception, advancing 0.14%. In Asia, China’s CSI, the Hong Kong Hang Seng and Japan’s Nikkei all closed down over 0.75%.
Locally yesterday, the ASX200 dropped 0.9% to its lowest point in nearly 6 weeks off the back of the RBA’s monthly cash rate meeting, as governor Michelle Bullock warned that there could be more inflationary pressure in the economy than expected. Although the RBA’s decision to leave the rate unchanged was widely expected, the cautious tone regarding inflation in their monetary policy statement left investors concerned.
Utilities saw the biggest decline on the day amid plans by the federal government to force power companies into offering customers 3 free hours of power in the middle of the day – Origin Energy (ASX:ORG) and AGL (ASX:AGL) slipped 3.8 and 3.7% respectively.
What to watch today:
- Ahead of today’s trading session however, the SPI futures indicate that the ASX will rebound with a 0.2% jump at the open.
- In commodities, prices across the board have seen drops over the last 24 hours. Gold has continued its slump, trading down 1.8% to 3930 USD per ounce, Silver has dropped over 2% to 47 USD per ounce, crude oil is also trading down 1.1% to 60USD and 37 cents per barrel, and Iron ore is down 1.25% to 104.50 USD per tonne.
Trading Ideas:
- Bell Potter has maintained its Buy rating on cyber security provider Spirit Technology Solutions (ASX:ST1), and raised its 12 month price target from 60 cents to 65 cents per share. At the current price of 55 cents per share, this implies a 15% share price growth within the year.
- And Trading Central have identified a bearish signal in Bapcor Ltd (ASX:BAP), indicating that the price may fall from the close of $2.42 to the range of $1.65 - $1.80 over a period of 9 days according to the standard principles of technical analysis.
In the US, Wall St kicked off November with a mixed session overnight. The Dow Jones closed down 0.48%, the S&P advanced a little over 0.1%, while the tech heavy Nasdaq added 0.46%, spurred on by gains in the AI sector. The biggest news was the announcement of a major $38 billion deal between OpenAI and Amazon, which lead to Amazon shares jumping a further 4%.
Europe too saw a mixed session – the Stoxx600 closed nearly flat as declines of 0.16% in the UK’s FTSE and 0.14% in the French CAC offset a 0.73% jump in Germany’s DAX. Meanwhile, Asian markets closed green across the board, lead by gains of 0.97%, 0.27%, and 2.12% in Hong Kong’s Hang Seng, China’s CSI and Japan’s Nikkei.
Locally yesterday, despite opening down and falling as low as 0.4%, the ASX200 closed out the day up 0.15%, driven primarily by gains across the banks. Westpac (ASX:WBC) saw the biggest gain, adding 2.8%, while CommBank (ASX:CBA), NAB (ASX:NAB), and ANZ (ASX:ANZ) all advanced 2.3%, 0.9% and 0.9% respectively. On the losing end, healthcare continued its run of poor performance, with major names ResMed (ASX:RMD) dropping 4.3%, and CSL (ASX:CSL) continuing its freefall with another 1.7% drop.
What to watch today:
- Looking ahead to today, the SPI futures are predicting the ASX will open down for a second straight day, indicating a 0.1% drop at the open.
- In commodities, Gold, Crude Oil and Iron ore are all trading flat today with no changes in their prices. Gold remains at $4003 USD per ounce, Crude Oil at 61 USD per barrel, and Iron Ore at 105 USD per tonne.
Trading ideas:
- Bell Potter has maintained its current Buy rating on defence name DroneShield (ASX:DRO) with its current 12 month price target at $5.30 per share, after they announced a new $25.3 million contract in Latin America with delivery and payment through the next 2 quarters.
- And Trading Central have identified a bullish signal in Woodside Energy Group (ASX:WDS), indicating that the price may rise from the close of $25.12 to the range of $27 - $27.40 over a period of 33 days, according to the standard principles of technical analysis.
Wall St ended last week’s trading session in the green, with all 3 key indexes closing up. The S&P500 added 0.26%, the Dow Jones advanced 0.09%, and the tech-heavy Nasdaq jumped 0.61%, mainly driven by a nearly 10% surge in Amazon shares after announcing strong quarterly results.
In contrast, European markets dropped across the board, as investors reacted to a flurry of quarterly results, regional economic data and recent policy announcements. The Stoxx 600 ended down by 0.51%, The U.K.'s FTSE and France's CAC both closed lower by 0.44%, and Germany's DAX ended 0.67% down.
Locally on Friday, the ASX closed flat to end the trading, as strong gains for gold miners across the market were offset by declines mainly in the consumer discretionary sector. Westgold (ASX:WGX) and Newmont (ASX:NEM) added 6% and 3.5% respectively, while on the other end JB Hi-Fi fell 3.4% and Wesfarmers (ASX:WES) lost 2.5%.
What to watch today:
- Ahead of today’s trading session, the SPI futures are indicating that the ASX will open the new week slightly down, predicting a 0.06% decline.
- In commodities, gold is trading down half a percent at 4004 USD per ounce. Crude oil is up 0.68% at 60.9 USD per barrel, and iron ore is trading up less than 0.1% at 105 USD per tonne.
Trading Ideas:
- Bell Potter has updated its recommendation on Endeavour Group (ASX:EDV) from a Hold to a Buy after positive Q1 FY26 results suggest its retail sales trajectory is improving.
- And trading central have identified a bullish signal in New Hope Corporation (ASX:NHC), indicating that the price may rise from the close of $4.19 per share to the range of $4.40 to $4.46 per share over a period of 21 days, according to the standard principles of technical analysis.
Has the AI rally run out of steam or is the train just taking off? Join Grady Wulff in her final Weekly Wrap for 2025, as she discusses the earnings results of the Magnificent 7 and how the AI revolution is impacting earnings growth.
In this week’s wrap, Grady covers:
- (0:46): Microsoft’s standout quarter, beating Wall Street’s expectations
- (2:02): how Alphabet’s use of AI and cloud strategy boosted revenue
- (3:12): Investors react to Meta’s third quarter results amid a major tax bill
- (5:05): how the ASX200 performed this week so far
- (5:54): the most traded stocks & ETFs by Bell Direct clients
- (6:22): economic news items to watch out for.
The US overnight saw an overall mixed trading session - the Dow Jones retreated 0.16% and the S&P500 0.11% from their record highs on comments from Fed Chair Jerome Powell suggested that there may not be further interest rate cuts this year. Meanwhile, the tech heavy Nasdaq bucked the trend and advanced 0.55%. The jump was primarily driven by Nvidia, which added a further 3% overnight and became the first company in history to hit the 5 trillion US dollar market cap milestone.
All eyes are now on the post close, where investors will react to the biggest earnings day for the megacap tech stocks, with Meta, Microsoft and Alphabet results all due.
Europe overnight also saw a mixed session – the Stoxx600 traded nearly flat, The UK’s FTSE gained 0.61%, while Germany’s DAX and France’s CAC retreated 0.64% and 0.19% respectively.
Locally yesterday, the ASX200 slid almost 1% in its worst trading day since September as worse than inflation results dashed investors hopes for another interest rate cut this year. The major banks were among the hardest hit, with CBA (ASX:CBA), NAB (ASX:NAB) and Westpac (ASX:WBC) falling 2.1 2.6 and 3.1% respectively. The real estate sector, which is also sensitive to interest rates declined as well – Stockland (ASX:SGP) and Mirvac (ASX:MGR) closed down 3.9% and 2.1%.
Of the key sectors, healthcare performed the worst of all largely weighed down by CSL (ASX:CSL), which slid a further 4% to its lowest price since 2018 following a downgrade on its projected earnings. On the winning side, Uranium stocks performed very well after the US Government, Brookfield and Cameco announced a transformational partnership, with at least 80 billion USD committed to building new nuclear power reactors. The highlight of the day was Boss Energy (ASX:BOE) which jumped nearly 20%, while the broader Uranium ETF ticker code ATOM was up 8.7%.
What to watch today:
- Looking ahead to today’s trading session, the SPI futures indicate the ASX200 will open down a further 0.36%, building on yesterday’s losses.
- In commodities, Gold is trading down a further 0.58% at 3929 USD/ounce, crude oil is trading 0.35% higher at 60 US dollars and 36 cents per barrel, and Iron ore is trading nearly flat at 105 US dollars and 66 cents per tonne.
Trading Ideas:
- Bell Potter has updated its rating on Woolworths Group (ASX:WOW) from a Hold to a Buy and increased its 12 month target price to $30.70 per share, off the back of promising Q12026 results showing growing revenues across multiple areas of the business.
- And trading central have identified a bearish signal in James Hardie Industries (ASX:JHX), indicating that the stock price may fall from the close of $33.87 to the range of $26.25-$27.50 per share over a period of 21 days, according to the standard principles of technical analysis.
Wall Street closed higher on Tuesday as investors bought back into the AI thematic ahead of the Fed’s anticipated rate cut announcement at the conclusion of the FOMC meeting this week. The major averages reset record highs again on Tuesday with the Dow jones rose 0.34%, while the S&P500 gained 0.23% and the Nasdaq ended the day up 0.8%.
In Europe overnight markets closed mixed as the UK’s FTSE100 hit a fresh record high closing up 0.44% while the STOXX 600 fell 0.22%, Germany’s DAX lost 0.12% and the French CAC ended the day down 0.27%.
Across the Asia region on Tuesday, markets closed mostly lower as investors digested a new rare earths deal signed by U.S. President Donald Trump and Japan’s new Prime Minister Senae Takaichi. Japan’s Nikkei fell 0.58%, Hong Kong’s Hang Seng lost 0.33%, China’s CSI index fell 0.51% and South Korea’s Kospi index retreated 0.8% on Tuesday.
Locally on Tuesday, the ASX200 posted a 0.48% loss despite records set on Wall St on Monday and prospects of a trade deal between the US and China nearing fruition. The local market sell-off was due to heavy weights tumbling like WiseTech Global which plunged over 15.5% and CSL which also ended the day down over 15.5%.
WiseTech Global (ASX:WTC) had investors fleeing yesterday after reports surfaced that the Australian Federal Police and ASIC allegedly raided the offices of the company in search of information related to share sales by the company’s founder and several colleagues.
CSL (ASX:CSL) tanked after downgrading guidance amid softer demand for influenza vaccines in the US and the company also announced it is delaying the demerger of Seqirus, its vaccine division, until market conditions improve.
Investors also sold out of Liontown yesterday after the lithium miner released a quarterly update outlining a small increase in production but a sharp decline in sales and higher costs during the period.
What to watch today:
- On the commodities front this morning oil is trading 2.25% lower at US$59.93/barrel, gold is down 0.65% at US$3955.58/ounce and iron ore is down 0.01% at US$105.56/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.89 US cents, 100.09 Japanese yen, 49.02 British pence and 1 New Zealand dollar and 14 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day up 0.17%.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Liontown Resources (ASX:LTR) from $1.15 to $1.30 per share and maintain a buy rating on the lithium producer following the release of the company’s Q1 trading update including lithium concentrate production and sales that topped Bell Potter’s expectations while revenue fell slightly short due to weaker realised prices and a delayed shipment.
- And Trading Central has identified a bullish signal on Universal Stores (ASX:UNI) following the formation of a pattern over the period of 259 days which is roughly the same amount of time the share price may rise from the close of $9.10 to the range of $11.80 to $12.50 according to standard principles of technical analysis.
US stocks saw a record-breaking session overnight, with all 3 major indexes closing at new all times highs off the back of cooling US-China tensions and optimism over a trade deal later this week. The S&P 500 advanced 1.23%, the Nasdaq rallied 1.86% - largely bolstered by strong gains for Nvidia and other chip stocks – while the Dow Jones jumped 0.71%.
Similarly, Asian markets saw a large jump, lead by a 1.19% jump for China’s CSI index, and a 2.46% jump for Japan’s Nikkei. Europe also saw gains but to a lesser extent – the Stoxx600 advanced 0.22%, Germany’s DAX advanced 0.28%, the French CAC saw a 0.16% jump, while the FTSE closed 0.09% higher.
Locally yesterday the ASX200 advanced 0.41% - despite 8 of the 11 key sectors in the green, it was slightly weighed down by a 0.63% drop in the healthcare index. It was a tough session too for Rare Earths Miners off the back of optimism that the US and China will come to an agreement to resume normalised Rare Earths trade, cooling off some of the building steam in the sector. Iluka Resources (ASX:ILU) saw a 6.87% drop, while Arafura Rare Earths (ASX:ARU) dropped nearly 10%.
What to watch today:
- In commodities, Gold has continued its recent retreat, down another 3.18% to 3981 US dollars per ounce, meaning it is now down nearly 9% over the last week. Crude Oil is trading flat at 61.5 US dollars per barrel, while Iron Ore is up 0.15% to 105 US dollars and 57 cents per tonne.
- Despite the strong gains in the US overnight, the ASX200 is actually expected to fall at the open this morning, with the SPI futures indicating a 0.43% drop.
Trading ideas:
- Bell Potter has maintained its buy rating on Bega Cheese (ASX:BGA) with a 12 month target price of $7 per share. At the current closing price of $5.34 per share, that implies a 24% share price growth over the next year based on current earnings estimates and guidance.
- And Trading Central have identified a Bullish signal in Karoon Energy (ASX:KAR), indicating the share price may rise from the close of $1.63 per share, to the range of $2.10 to $2.25 per share over a period of 41 days according to the standard principles of technical analysis.
Wall Street closed in record territory on Friday after cooler-than-expected inflation data in the U.S. boosted investor optimism that the Fed can continue on its rate cutting journey. The Dow Jones rose 1.01% to close at a record over 47,000 for the first time, while the S&P500 added 0.8% also at a fresh record and the Nasdaq rounded out the trifecta of records closing the day up 1.15%. September CPI in the U.S. came in at a rise of 0.3% taking annual inflation to 3%, below the 0.4% and 3.1% readings economists were expecting.
In Europe on Friday markets closed higher as U.S. inflation came in lower than expected. The STOXX 600 rose 0.2%, Germany’s DAX added 0.13%, the French CAC closed flat, and in the UK, the FTSE100 ended the day up 0.7%.
Across the Asia region on Friday, markets closed higher as reports surfaced that trade negotiations between the U.S. and China will resume this week. Japan’s Nikkei rose 1.35%, South Korea’s Kospi Index added 0.11%, and Hong Kong’s Hang Seng gained 0.74%.
The ASX200 posted a 0.15% loss on Friday as President Trump ended trade talks with Canada and negotiations with China failed to progress on Friday especially over rare earth supplies, causing investors to remain concerned over the instability of the global trade landscape.
Mount Gibson Iron tanked over 25% on Friday after the Australian iron ore producer announced a significant rockfall event at the company’s Koolan Island operations has forced the halt of production at the operation of the 80-year-old mine.
What to watch today:
- On the commodities front this morning oil is trading 0.5% lower at US$61.50/barrel, gold is down 0.34% at US$4111.89/ounce and iron ore is flat at US$105.55/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.47 US cents, 100.02 Japanese yen, 48.84 British pence and 1 New Zealand dollar and 14 cents.
- Ahead of Monday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.3%.
Trading ideas:
- Bell Potter has initiated coverage of Elsight (ASX:ELS) with a buy rating and a 12-month price target of $1.90 on the tech company that specialises in creating secure, continuous, and reliable communication solutions for unmanned systems like drones and robotics. Elsight is a buy from Bell Potter’s analyst because it provides a mission-critical communication platform for unmanned systems, positioning it as a pure-play enabler of the rapidly expanding global drone and defence markets. With strong validation from repeat OEM orders, accelerating sales investment, and a scalable, recurring-revenue model, ELS offers compelling growth and valuation upside.
- Trading Central has identified a bullish signal on New Hope Corporation (ASX:NHC) following the formation of a pattern over a period of 28-days which is roughly the same amount of time the share price may rise from the close of $4.00 to the range of $4.80 to $4.95 according to standard principles of technical analysis.
Record sales couldn’t save Nasdaq listed Tesla and Netflix from steep share price falls this week, as the companies navigated everything from expiring tax credits and global regulatory risks to intense competition. Meanwhile, the ASX200 posted a 0.39% slide (Mon – Thurs), as a slump in materials stocks weighed on market gains.
In this week’s wrap, Grady covers:
- (0:26): why Tesla’s latest results show record sales but falling profits
- (1:10): why Netflix missed third- quarter expectations
- (2:02): how Coco-Cola is navigating the tough market environment
- (2:49): earnings results from Woodside, Adairs & Air New Zealand
- (5:13): how the ASX200 performed this week so far
- (5:53): the most traded stocks & ETFs by Bell Direct clients
- (6:22): economic news items to watch out for.
Wall Street closed lower on Wednesday as investors assessed further updates out of Washington signalling dwindling progress on the trade front between the U.S. and China. The Dow Jones lost 0.71%, the S&P500 declined 0.53% and the Nasdaq ended the day down 0.93%.
In Europe overnight markets in the region closed mixed as investors assessed corporate earnings results out in the region. The STOXX 600 fell 0.2%, Germany’s DAX lost 0.74%, the French CAC declined 0.63% and, in the UK, the FTSE100 ended the day up 0.93%.
Asia markets traded mixed on Wednesday as investors assessed key trade data out of Japan alongside the country’s new leadership transition. For September, Japanese exports increased 4.2% YoY to snap four months of declines, however, the data came in lower than economists were expecting of 4.6% growth. Japan’s Nikkei closed flat on Wednesday while Hong Kong’s Hang Seng fell 0.94%, South Korea’s Kospi Index rose over 1.5% and India’s Nifty 50 ended the day up 0.1%.
The local market closed the midweek session 0.71% lower as a materials sell-off of more than 3% weighed on gains among energy and tech stocks. The price of gold slumped over 6% overnight amid widespread profit taking and strength in the USD which spooked investors into panic sell mode out of gold miners on Wednesday. Genesis Minerals, Evolution Mining and Ramelius Resources each fell over 10% at the closing bell on Wednesday.
Homewares retailer Adairs (ASX:ADH) jumped 8.3% yesterday despite downgrading group sales forecast guidance for H1 to between $319.5m to $331.5m, down from the prior guidance of $324.5m to $336.5m, however margins were upgraded to the higher end of the forecast region at 59%-59.5%. Investors likely welcomed the pullback in promotional activity announced by the company amid moderated sales growth.
And weaker-than-expected revenue and rising jet costs hit Air New Zealand (ASX:AIZ) yesterday with shares in the airline falling 1% after the company announced it expects to report a pre-tax loss between NZ$30m and NZ$55m for the first half.
What to watch today:
- On the commodities front this morning oil is trading 4.25% higher at US$59.67/barrel, gold is down 0.52% at US$4103/ounce and iron ore is up 0.03% at US$105.53/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.92 U.S. cents, 98.64 Japanese yen, 48.51 British pence and 1 New Zealand dollar and 13 cents.
- Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.17%.
Trading Ideas:
- Bell Potter has downgraded the rating on Aeris Resources (ASX:AIS) from a buy to a hold and have raised the 12-month price target on the copper producer following the release of the company’s September quarterly report including results meeting the analysts’ expectations for lower 1HFY26 production. The reason for the downgrade is simply due to recent share price appreciation of the company.
- Trading Central has identified a bearish signal on Viva Energy (ASX:VEA) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may fall from the close of $1.74 to the range of $1.54 to $1.58 according to standard principles of technical analysis.
Hedley and Grady dive into the key themes shaping the commodities market heading into 2026, from gold’s price rally to the outlook for copper, iron ore and beyond.
Hedley & Grady discuss:
- (0:52): Drivers of the current gold price run & how far it can go
- (4:15): gold miners to watch in 2026
- (8:46): the importance of mining companies having multiple assets
- (10:22) outlook for copper with supply-demand equilibrium mismatch anticipated
- (14:06) copper names to watch in 2026
- (15:40) iron ore outlook and blue-chip mining giant diversification
- (17:12) metrics to monitor when considering mining investments in 2026
- (21:25) Hedley’s commodity ‘clock’ and what time it is in the cycle right now
- (24:00) commodities Hedley & Grady are bullish on for 2026
- (28:00) where investors have been buying recently in the commodities space
- (32:00) Hedley & Grady predict the gold price / ounce a year from now.
Note: This interview was filmed on 21 October 2025.
In the US overnight, Wall St closed trading mixed higher as investors responded to stronger-than-expected corporate earnings results out of key names like Coca-Cola and 3M. The Dow Jones is closed up 0.47%, the S&P500 is closed flat and the Nasdaq closed down 0.16%
Across Europe overnight, markets closed higher led by strong gains for defence stocks in the region. The STOXX 600 rose 0.2%, Germany’s DAX added 0.3%, the French CAC climbed 0.64% and, in the UK, the FTSE100 ended the day up 0.25%.
The Asia markets closed mostly higher as Japan’s first female Prime Minister was announced and investors continued to assess trade negotiations in the region. Japan’s Nikkei rose 0.27%, South Korea’s Kospi Index added 0.24%, Hong Kong’s Hang Seng gained 0.76% and China’s CSI index ended the day up 1.53%.
The local market extended its green run this week into Tuesday’s session with the key index gaining 0.7% at the closing bell driven by the materials sector after Australia and the US agreed to invest a combined US$3bn in critical minerals projects, as part of Prime Minister Albanese’s visit to the White House.
Gold reset its record yesterday topping US$4381/ounce for the first time which propelled local gold miners higher, while rare earths producers were bought into on the back of the US-Australia critical minerals deal.
HUB24 (ASX:HUB) surged over 10% yesterday after platform funds under administration rose 8% over the September quarter to $122bn, while DroneShield (ASX:DRO) also rose 8.7% as investors bought back into the counter-drone technology company.
What to watch today:
- On the commodities front this morning, oil is trading 0.7% higher at US$57.42/barrel, gold is down 5.56% at US$4116/ounce as the US dollar strengthened and profit-taking kicked in following the price of the precious commodity hitting a fresh record over US$4382/ounce on yesterday, and iron ore is up 0.14% at US$105.50/tonne.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down 0.5%.
Trading ideas:
- Bell Potter has maintained its buy rating on HUB24 (ASX:HUB) and increased its 12 month target price from $125 to $135 off the back of better than expected Q1 FY26 results and significant market momentum.
- And Trading Central have identified a bullish signal in Super Retail Group (ASX:SUL), indicating that the price may rise from the current close of $17 per share to the range of $17.80 to $18 per share over a period of 21 days, according to the standard principles of technical analysis.
Wall Street started the new trading week in positive territory as investors looked toward a potential end to the government shutdown now in its 3rd week, and as Apple shares boosted tech stocks following an upgrade to a buy rating from Loop Capital. The Dow Jones rose 1.12%, the S&P 500 also climbed 1.07% and the Nasdaq ended the day up 1.37%.
In Europe overnight markets closed mostly higher as defence stocks drove gains in the region. The STOXX 600 gained 1%, Germany’s DAX added 1.9%, the French CAC climbed 0.4% and, in the UK, the FTSE100 ended the day up 0.5%.
Across the Asia markets on Monday, it was a positive session as key economic data out in the region boosted investor sentiment. Japan’s Nikkei rose 3.37% to a fresh record high, while China’s CSI index added 0.53%, Hong Kong’s Hang Seng climbed 2.52% and South Korea’s Kospi index ended the day up 1.76%.
China’s Q3 GDP data out yesterday weighed on investor sentiment with the reading coming in at expansion of 1.1% over the September quarter, which exceeded analysts’ expectations of 0.8% expansion, and over the 12-months to September the Chinese economy expanded 4.8% which met forecasts, signalling a material rebound in economic recovery post pandemic is potentially finally underway.
The local market started the new trading week lower early on Monday before turning positive to post a 0.4% rise at the closing bell led by a rally for financials and REIT stocks on Monday.
Neuren (ASX:NEU) shares took off yesterday with a gain over 4% after the pharmaceutical company announced it has received US FDA Fast Track Designation for its drug candidate NNZ-2591 for the treatment of Phelan-McDermid syndrome. Currently, there are no FDA-approved treatments for Phelan-McDermid syndrome which places Neuren at the forefront of care for this condition when the drug reaches commercialisation.
Vehicle parts provider Bapcor (ASX:BAP) tumbled over 17.5% on Monday after the company reported a profit downgrade and disclosed a $12m pre-tax earnings hit due to challenging operating practices in its trade division.
Deep Yellow (ASX:DYL) also dived over 18% after the uranium company announced the immediate exit of its Chief Executive, John Borshoff, and will be replaced by the company’s CFO, Craig Barnes as acting CEO until a permanent appointment is made.
What to watch today:
- On the commodities front this morning oil is trading 0.3% lower at US$57.47/barrel, gold is back in record territory with another gain of 2.72% to trade at US$4365.85/ounce and iron ore is down 0.2% at 105.35/ounce.
- The Aussie dollar has strengthened against the greenback to buy 65.16 U.S. cents, 98.18 Japanese yen, 48.5 British pence and 1 New Zealand dollar and 13 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.5%.
Trading ideas:
- Bell Potter has reduced the 12-month price target on Beach Energy (ASX:BPT) from $1.25 to $1.10 and maintain a hold rating on the energy exploration and development company. The price target was decreased despite strong quarterly results because the medium-term earnings outlook worsened, with the analyst reducing EPS forecasts in FY27 (-18%) and FY28 (-9%) due to factors like unsuccessful exploration (e.g., Hercules-1) and ongoing high capex. The Hold rating was maintained as near-term production is steady and cash flow is expected to improve, but the longer-term growth and returns remain uncertain.
- And Bell Potter has initiated coverage of Austco Healthcare (ASX:AHC) with a buy rating and a 12-month price target of 55cps. AHC manufactures sophisticated nurse call systems, enterprise reporting and analytics tools, for the purpose of improving patient outcomes and reducing cost for healthcare organisations. AHC is rated a Buy by Bell Potter’s analyst due to its strong revenue and earnings growth, underpin
Wall St closed higher across the key indices on Friday as investor hopes of easing trading tensions between the U.S. and China rose a day after credit concerns sparked a sharp selloff for U.S. regional banks. The S&P500 rose 0.53% on Friday while the Nasdaq added 0.52% and the Dow Jones ended the day up 0.52%.
Across Europe on Friday markets closed lower amid credit concerns of bad debts looming across regional banks in the U.S. The STOXX 600 fell 0.95%, Germany’s DAX lost 1.82%, the French CAC fell 0.18% and, in the UK the FTSE100 ended the day down 0.86%.
Over the Asia markets on Friday, it was a mostly positive session as trade talks with the U.S. continue to make progress toward a sustainable solution. South Korea’s Kospi index rose to a record high for a third day, ending the session up 0.01% while Hong Kong’s Hang Seng fell 2.48% and India’s Nifty 50 gained 0.48%.
Locally on Friday the key index lost 0.81% to end a very volatile trading week triggered by increased trade war tensions between the US and China on Thursday, while the gold rally worked to offset some of the market losses.
The price of gold hit yet another record high on Friday topping US$4350/ounce for the first time in history. This boosted local miners further into the green with Newmont (ASX:NEM) adding 3.32% while Northern Star (ASX:NST) gained 2.75% and Evolution Mining (ASX:EVN) ended the day up almost 2%.
EROAD (ASX:ERD) tumbled over 33% on Friday after the company announced a restructure of plans to focus more on the ANZ market and step back from its North American expansion plans.
Lynas (ASX:LYC) shares fell 5.7% on Friday amid increased investor concerns that easing tensions between China and the US over rare earth export controls could lead to a deal, potentially lowering rare earth prices and pressuring suppliers like Lynas. Comments from China’s Ministry of Commerce suggesting openness to trade talks triggered the sell-off.
What to watch today:
- On the commodities front this morning oil is trading 0.14% higher at US$57.54/barrel, gold is down 1.81% at US$4250/ounce and iron ore is down 0.2% at US$105.35/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.88 U.S. cents, 97.35 Japanese yen, 48.50 British pence and 1 New Zealand dollar and 13 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down 0.08%.
Trading ideas:
- Bell Potter has reduced the 12-month price target on Avita Medical (ASX:AVH) from $1.50 to $1.20 and maintain a sell rating on the therapeutic acute wound care company following the release of the company’s September quarter update including revenues down 12% on the PCP and the departure of the company’s CEO. The analyst sees in the absence of a bid for the company, which remains highly uncertain, we maintain our Sell rating. FY25 revenues have been exceptionally poor capped off by the 3Q25 decline.
- And Trading Central has identified a bearish signal on Suncorp Group (ASX:SUN) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may fall from the close of $19.56 to the range of $18.50 to $18.80 according to standard principles of technical analysis.
Markets tumbled this week as renewed US–China trade tensions reignited volatility across global equities. Social media fuelled tariff threats and retaliatory sanctions have reminded investors how quickly sentiment can shift. With headline risk back in focus, flexibility and diversification remain key for navigating the uncertainty.
In this week’s wrap, Grady covers:
- (0:29): trade tensions in the news again - the market’s worst day in months
- (1:45): how investors’ strategy needs to change during this period of volatility
- (3:15): the impact of the trade war on ASX listed stocks
- (4:17): how the local market performed over the last trading week
- (5:18): the most traded stocks and ETFs this week
- (5:50): economic news items to look out for next week.
Wall Street edged higher on Wednesday as strong earnings results out of the Bank of America and Morgan Stanley boosted the major averages into the green at the closing bell. The Nasdaq added 0.6%, the S&P 500 gained 0.4%, and the Dow Jones ended the day flat.
Cooking oil stocks surged in the U.S. on Wednesday after President Trump threatened to cut off U.S. purchases of Chinese cooking oil.
In Europe overnight markets closed mixed as luxury brands across the region led markets gains. The STOXX 600 rose 0.7%, Germany’s DAX fell 0.1% and, in the UK, the FTSE100 ended the day down 0.3%.
Across the Asia region on Wednesday, it was a sea of green despite renewed trade threats between the world’s two largest economies. Japan’s Nikkei rose 1.76%, China’s CSI index added 1.48%, Hong Kong’s Hang Seng gained 2.06% and India’s Nifty 50 ended the day up 0.74%.
Locally yesterday, the ASX200 posted a 1.03% rise on Wednesday as gains from the healthcare stocks, the major banks and gold miners boosted the key index to a positive finish.
Telix Pharmaceuticals (ASX:TLX) soared over 15% yesterday after the radiopharmaceutical company released a positive Q3 trading update including a 53% increase YoY in unaudited revenue to US$206m, the receipt of full reimbursement for its Gozellix Product from the US Centres for Medicare and Medicaid Services, and the company raised its full year revenue guidance range to US$800 to US$820m from US$770 to US$800m.
And the competition watchdog launched a probe into the merger between Southern Cross Media and Seven West Media due to concerns it may reduce competition in an already consolidated market.
What to watch today:
- On the commodities front this morning oil is trading 0.15% lower at US$58.50/barrel, gold is up a further 1.51% at a fresh record US$4205.90/ounce and iron ore is down 1.2% at US$105.25/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.08 US cents, 98.45 Japanese yen, 48.77 British pence and 1 New Zealand dollar and 1 New Zealand dollar and 14 cents.
- Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down just 0.04%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Jumbo Interactive (ASX:JIN)from $11.50 to $11.85 and maintain a hold rating on the digital lotteries business following the company’s acquisition of Dream Car Giveaways for an enterprise value of $109.9m. The analyst sees the acquisition is another positive step in diversifying revenue and the hold rating is maintained due to risks in market share as new players enter the lotteries market and key competitors strengthen their offerings.
- And Trading Central has identified a bullish signal on Vicinity Centres (ASX:VCX) following the formation of a pattern over a period of 96-days which is roughly the same amount of time the share price may rise from the close of $2.54 to the range of $2.74 to $2.78 according to standard principles of technical analysis.
The US saw a volatile trading session overnight ultimately end mixed across the 3 major benchmarks. The S&P500 closed down 0.2% and the Nasdaq closed down 0.8%, although they had fallen as low as 1.5 and 2.1% throughout the day. The Dow Jones despite opening down 1.3% rallied to close up 0.4% - the volatility comes amid continuing trade tensions between the US and China.
Europe too saw a mostly a negative session ovvernight. The STOXX 600 fell 0.4%, Germany’s DAX lost 0.62%, the French CAC fell 0.18% and the FTSE100 ended the day up 0.1%.
Across the Asia region on Tuesday, markets closed mostly lower as China’s Ministry of Commerce sanctioned five US-related units of Hanwha Marine Corporation in direct retaliation to the US’ investigation of Chinese maritime, logistics and shipbuilding industries in a step backward in the trade negotiations. Japan’s Nikkei fell 2.58% on Tuesday, while China’s CSI index lost 1.12%, Hong Kong’s Hang Seng fell 1.74% and India’s Nifty 50 ended the day down 0.55%.
The local market traded lower on Tuesday before closing the session up 0.2% as US-China trade negotiations showed signs of progression on Monday, Middle East tensions continued to ease, and the AI rally marched on in the US.
NAB Business Confidence data for September came in at a rise to 7 index points for last month, up from 4 points in August, but short of the 9 points the market was expecting a rise to. The small rise though signals greater optimism from a business perspective in Australia following a mostly negative year on the sentiment front for businesses in FY25.
Australian consumer confidence on the other hand weighed on the market gains yesterday as the latest ANZ-Roy Morgan consumer confidence survey unveiled sentiment weakened in October to a 1-year low.
What to watch today:
- On the commodities front this morning, oil is trading 1.22% lower at US$58.83/barrel, gold is up 0.43% at US$4145/ounce and iron ore is up 0.75% at US$106.53/tonne.
- Ahead of Wednesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.83%.
Trading Ideas:
- Bell Potter maintains its Buy rating on Uranium producer Paladin Energy (ASX:PDN) and has raised its target price from $10.30 to $11.35, off the back of record Q1 FY25 production as well as steady increases in the average realised Uranium price.
- And Trading Central have identified a bullish signal on CSL (ASX:CSL), indicating that the price may rise from the current close of $211 to the price range of $228-232 over a period of 37 days, according to the standard principles of technical analysis.
Wall Street started the new trading week with a strong rebound after President Trump said trade relations with China will be fine, a few days after threatening massive tariff increases on the region. Investor sentiment eased and stocks surged as a result of Trump’s message to start the new trading week higher. The S&P 500 added 1.56% on Monday while the Nasdaq climbed 2.21% and the Dow Jones ended the day up 1.29%.
In Europe on Monday markets closed higher led by a mining rally as investors keep an eye on trade negotiations between the US and China. The STOXX 600 rose 0.44%, Germany’s DAX added 0.6%, the French CAC climbed 0.21% and, in the UK, the FTSE100 ended the day up 0.16%.
Across the Asia region on Monday markets closed lower as investors pulled back amid trade tension uncertainty between the world’s largest two regions. China’s CSI index fell 0.5%, Hong Kong’s Hang Seng fell 2.04%, Japan’s Nikkei lost 1.01% and South Korea’s Kospi index ended the day down 0.72%.
Locally to start the new trading week, investor sentiment was dented by Wall Street’s Friday tumble and Trump’s renewed tariff threats, which led to a broad sell-off on the ASX to start the new week with the key index ending the day down 0.94% in the worst session since mid-September.
Gold scaled to a fresh record high again on Monday amid renewed macro and trade uncertainty which fuelled a buying frenzy among the gold miners on Monday with Northern Star (ASX:NST) and Ramelius Resources (ASX:RMS) rising over 1% each while Regis Resources (ASX:RRL) soared over 7%.
Treasury Wine Estates (ASX:TWE) tumbled over 11% on Monday after the wine maker scrapped earnings guidance due to weaker-than-expected trading in China, with the company also halting its $200m share buyback which signals elevated trading uncertainty.
Margin contraction hurt Fletcher Building (ASX:FBU) on Monday with shares in the company falling almost 2% after a trading update unveiled margin contraction in its heavy building materials volumes.
What to watch today:
- On the commodities front this morning oil is trading 2.41% higher at US$59.64/barrel gold is up 2.3% at US$4105/ounce and iron ore is up 0.84% at US$105.74/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.21 US cents, 99.27 Japanese yen, 48.96 British pence and 1 New Zealand dollar and 14 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.3% tracking Wall Street’s gains overnight.
Trading Ideas:
- Bell Potter has raised the 12-month price target on COG Financial (ASX:COG) from $2.25 to $2.70 and maintain a buy rating on the diversified conglomerate of Australian distribution businesses following the announcement that the company will acquire a non-controlling interest in its subsidiary Fleet Network for a consideration of $23.9m.
- And Trading Central has identified a bearish signal on SGH (ASX:SGH) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may fall from the close of $47.80 to the range of $46.60 to $46.90 according to standard principles of technical analysis.
Wall Street tumbled on Friday in the worst session in months after Trump took to his social media platform to announce plans for a “massive increase in tariffs on China” amid rising trade negotiation tensions. The S&P500 fell 2.71%, the Nasdaq tumbled 3.56% and the Dow Jones ended the day down 1.9%.
In Europe on Friday markets closed lower after Trump threatened heightened tariffs on China which threatens to disrupt the stability of the global trade landscape once again. The STOXX 600 fell 1.3%, Germany’s DAX lost 1.4%, the French CAC declined 1.53%, and, in the UK, the FTSE100 ended the day down 0.9%.
Across the Asia markets on Friday, it was mostly a sea of red as investors assess the state of trade and economic environments in the region. Japan’s Nikkei fell 1.01% on Friday while Hong Kong’s Hang Seng lost 1.84%, and China’s CSI index ended the day down 1.97%. South Korea’s Kospi index was the only market to close with a gain of 1.73% on Friday.
The local market ended Friday’s trading session with a 0.13% loss as a Gaza peace plan prospect through Israel implanting a ceasefire deal in the strip led to a selloff in gold and oil stocks, while iron ore miners also dipped on further price disputes between China and BHP.
L1 Group (ASX:L1G) soared over 11% on Friday after Bell Potter increased the 12-month price target on the company by almost 30% to 90cps amid the stability of growing funds for L1, the increased scale of the combined group, the upside from further cost synergies between L1 Capital and Platinum under the new L1 Group and further acquisitions of teams to bolster the strength of the company.
What to watch today:
- On the commodities front this morning oil is trading 4.24% lower at US$58.90/barrel, gold is up 1.02% at US$4015.59/ounce and iron ore is up 0.84% at US$105.74/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.07 US cents, 98.83 Japanese yen, 48.58 British pence and 1 New Zealand dollar and 13 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down 0.94%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Develop Global (ASX:DVP) from $5.10 to $5.40 and maintain a buy rating on the hybrid mining services and critical metals producer following the release of the company’s updated DFS for its Sulphur Springs Zinc-Copper mining project. DVP’s updated Sulphur Springs DFS shows a major uplift in project value (pre-tax NPV8% of $921m) driven by higher metal prices, increased plant throughput (1.5Mtpa), and a 19% reduction in operating costs. This enhances project economics and supports a valuation upgrade to $5.40/share.
- And Trading Central has identified a bullish signal on Universal Stores (ASX:UNI) following the formation of a pattern over a period of 247 days which is roughly the same amount of time the share price may rise from the close of $8.87 to the range of $11.50 to $12.20 according to standard principles of technical analysis.
Global markets saw a shakeup this week, as AI optimism cooled, global trade tensions rose, and the US government shutdown continued into week two. The uncertainty saw investors pile into gold, sending it above US$4,000/oz for the first time in history, and with central banks stockpiling bullion and rate cuts expected, the gold rush could still have plenty of room to move in FY26. The renewed drivers and tailwinds are fuelling greater momentum for the gold price, with hedge books winding down at a rapid rate.
In this week’s wrap, Grady covers:
• (0:34): rate cuts and valuation gaps – factors driving the gold rush
• (2:23): how the record run is affecting Aussie mining stocks
• (3:26): highlights from emerging names in the gold sector
• (4:51): how the local market performed over the last trading week
• (5:33): the most traded stocks and ETFs this week
• (6:03): economic news items to look out for next week.
Wall St closed the midweek session back in record territory as investors overlooked the recent AI concerns and government shutdown and bought back into undervalued areas of the market. The S&P500 rose 0.58% to a fresh record close, the Nasdaq added 1.12% to also post a new record high and the Dow Jones ended the day flat. Investors also showed little reaction to the Fed’s latest FOMC meeting minutes which were released overnight and covered the first rate cut out of the Fed for 2025.
In Europe on Wednesday markets closed higher as investors welcomed tariffs proposed to be imposed on steel imported into the EU. The STOXX 600 rose 0.8%, Germany’s DAX added 0.87%, the French CAC climbed 1.07% and, in the UK, the FTSE100 ended the day up 0.7%.
Across the Asia region on Wednesday markets closed mixed while China, Hong Kong and South Korean markets remained closed for a holiday. Japan’s Nikkei fell 0.45% on Wednesday while India’s Nifty50 ended the day down 0.25%.
Locally on Wednesday the ASX200 posted a 0.1% loss at the closing bell as declines in retail and tech stocks, the rate sensitive sectors, outweighed strength within the healthcare sector. Investor concerns around the sustainability of profits among AI providers was the key factor behind the tech pullback yesterday.
James Hardie’s (ASX:JHX) shares jumped 10% after better-than-expected Q2 sales, led by strong U.S. siding and trim performance. Stable distributor inventories and good cost control helped margins for the building materials maker. While new home construction is soft, renovation demand for premium materials remains resilient, highlighting how well-positioned companies can still perform despite ongoing sector challenges.
The price of gold reached new heights on Wednesday topping US$4000/ounce for the first time in history which extended the recent rally for some local gold miners including Minerals260 (ASX:MI6) soaring over 10%, while investors took the chance to take some profits off the table from key gold miners like Northern Star (ASX:NST) and Newmont (ASX:NEM) following a prolonged period of share price appreciation.
What to watch today:
- On the commodities front this morning oil is trading 1.07% higher at US$62.39/barrel, gold is up a further 1.24% at US$4035.14/ounce and iron ore is up 0.07% at US$104.29/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.88 US cents, 100.59 Japanese yen, 49.06 British pence and 1 New Zealand dollar and 14 cents.
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX will open the day up a sharp 0.42%.
Trading ideas:
- Bell Potter has initiated coverage of CAR Group (ASX:CAR) with a buy rating and 12-month price target of $42.20. The analyst has a Buy rating on CAR Group due to its strong global portfolio, consistent earnings growth, and exposure to underpenetrated markets with clear pathways for value creation. Trading at a 24% discount to peers, CAR offers an attractive risk-adjusted return profile compared to other ASX-listed classifieds like REA (ASX:REA) and SEEK (ASX:SEK).
- And Bell Potter maintains a Buy rating on Paladin Energy (ASX:PDN) and raises its price target to $10.30/share due to stronger uranium market fundamentals, stable ramp-up at Langer Heinrich Mine, and upward adjustments to cash and share estimates. The stock remains undervalued relative to peers, with further upside potential as its Patterson Lake South project is de-risked.
In the US, all 3 major indexes snapped their winning streaks with overnight slides. The Dow Jones fell 0.2%, the S&P 500 dropped 0.4%, and the tech heavy Nasdaq was hit the hardest, closing down 0.7% , largely spurred by Oracle (NYSE:ORCL) and Tesla (NASDAQ:TSLA) stocks losing steam.
In Europe overnight, markets closed mixed on Tuesday as government shake ups weighed on key areas of the market, while a materials rally offset some weakness. The STOXX 600 lost 0.15% on Tuesday while Germany’s DAX added 0.03%, the French CAC climbed 0.04% and, in the UK, the FTSE100 ended the day up 0.05%.
Across the Asia region on Tuesday, markets closed mixed in the region as chip-stocks saw volatility while Japanese government bonds rose to all-time highs. Japan’s Nikkei closed flat on Tuesday, and India’s Nifty 50 rose 0.12% while Hong Kong, China and South Korean markets were all closed for a holiday.
The local market started the new trading week lower amid with a 0.27% decline on Tuesday amid lower trading volumes and a broad sell-off amongst the market.
Gold miners offset some of the losses again yesterday with the price of the precious commodity once again soaring to new heights amid looming US interest rate cuts and the prospect of a prolonged US government shutdown driving demand for the safe-haven commodity.
Australian Westpac Consumer Confidence data for October came in at a sharp decline of -3.5%, starkly different to the forecast rise of 3.1% as family finances weaken and economic uncertainty remains a concern. This weighed on the consumer discretionary sector yesterday as investors see falling consumer confidence as a sign of lower discretionary spend to come.
Web Travel (ASX:WEB) shares jumped over 2.5% after the hotel B2B organisation spun out of WebJet Group announced it was on track to deliver record EBITDA for FY26, while Brisbane Broncos (ASX:BBL)shares fell 12.8% a day after climbing over 20% as investors took some profits from the winning NRL team’s record close on Monday.
What to watch today:
- On the commodities front this morning, oil is trading 0.24% lower at US$61.54/barrel, gold is up 0.63% at US$3987/ounce and iron ore is down 0.25% at US$104.22/tonne.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down 0.04%.
Trading Ideas:
- Bell Potter have maintained their buy rating on biotechnology company Mesoblast (ASX:MSB) and raised the price target to $4 per share, after recent developments that its flagship drug Ryoncil has received a brand new J-Code in the US, allowing hospitals broader access to reimbursement when ordering the drug, and therefore increased projected revenue for Mesoblast.
- Trading Central have identified a bullish signal in QBE Insurance Group (ASX:QBE), indicating that the share price may rise from the close of $21.20 per share, to the range of $22.30 to $22.60 according to the standard principles of technical analysis.
Wall Street closed mostly higher on Monday as investor optimism increased for M&A as two major deals were announced for Comerica and AMD separately. The S&P 500 rose 0.4%, the Nasdaq gained 0.8% on Monday and the Dow Jones ended the day down 0.1%. AMD shares rose 23% on Monday after the company reached a deal with OpenAI to supply the leading AI generator with AI chips which could ultimately end up giving the ChatGPT maker a 10% stake in the chipmaker. Meanwhile, Comerica shares jumped 10% after Fifth Third Bancorp reached a deal to buy the fellow regional U.S. bank for US$10.9bn in an all-stock transaction.
In Europe overnight, markets closed mostly lower with the STOXX 600 closing flat as did Germany’s DAX closed flat, while the French CAC lost 1% after the country’s new prime minister called it quits after less than a month, and, in the UK, the FTSE100 ended the day down 0.13%.
Across the Asia region on Monday, markets closed mixed led by Japan’s Nikkei soaring 4% to a fresh record after the country’s ruling Liberal Democratic Party elected conservative Sanae Takaichi as its new leader, positioning her to become the country’s first female Prime Minister. Elsewhere in the region, Hong Kong’s Hang Seng fell 0.67% and India’s Nifty 50 ended the day up 0.74%.
Locally to start the new trading week the ASX200 closed just 0.07% lower as a tech and healthcare sell-off offset strength among the materials and utilities stocks. Gold and copper spot prices reaching a record and 16-month high respectively buoyed local producers yesterday with the outlook for continued momentum for both critical metals to extend for some time to come.
Brisbane Broncos (ASX:BBL) shares soared 27% on Monday to a record close after the club’s 19-year grand final winning drought ended on Sunday with the team taking out the winning title for 2025.
What to watch today:
- On the commodities front this morning oil is trading 1.5% higher at US$61.79/barrel, gold is up a further almost 2% to yet another record US$3962.58/ounce and iron ore is up 0.25% at US$104.36/tonne.
- The Aussie dollar has further strengthened against the greenback to buy 66.19 U.S. cents, 99.47 Japanese yen, 49.19 British pence and 1 New Zealand dollar and 13 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.16%.
Trading Ideas:
- Bell Potter has resumed coverage of Northern Star Resources (ASX:NST) with a buy rating and 12-month price target of $30.00, up from $20.85 as the analyst sees NST as a stable, low-risk gold producer entering a phase of free-cash-flow harvesting in FY27 following the $1.5bn investment in the KCGM mill expansion from 12 million tonnes per annum to 27 million tonnes per annum.
- And Trading Central has identified a bullish signal on Ventia Services Group (ASX:VNT) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $5.24 to the range of $5.85 to $6.00 according to standard principles of technical analysis.
This week’s news was a mixed bag on the commodities front - the gold rush continued as the precious commodity soared to fresh record highs, while on the other end iron ore and lithium saw volatility off the back of major news coming out of China. Meanwhile, the US Federal Government saw its first shutdown in 7 years, sending ripples through global markets for investors.
In this week’s wrap, Grady covers:
- (0:36): gold’s record-breaking run & what’s driving the rally
- (2:04): China’s ban on BHP imports; what it means for investors
- (3:24): another twist in the tale for Lithium
- (4:12): the impact of the US Government shutdown on the market
- (5:39): how the local market performed over the last trading week
- (6:27): the most traded stocks and ETFs this week
- (6:57): economic news items to look out for next week.
Overnight Wall St saw second consecutive record setting day, with the S&P500 closing up 0.34% to a new all time high. The Nasdaq also rose 0.42%, and the Dow Jones added 0.09% as investors remain confident that the US Federal Government shutdown will be brief and have little impact on the economy.
European markets also saw a positive session, largely spurred by gains in the healthcare sector. This comes as a deal between Pfizer and Donald Trump to lower prescription drug prices in the Medicaid program in exchange for tariff relief was announced, sparking relief and optimism for the sector. The Stoxx600 gained 1.15%, the UK’s FTSE index added 1.03%, the German DAX closed up 0.98% and the French CAC gained 0.98%.
Locally yesterday, the ASX closed nearly flat, declining just 0.03%. Despite 8 of the 11 sectors closing in the green, the market was weighed down by declines in the materials and consumer discretionary sectors. Lithium in particular was hit hard upon further news that Chinese mining giant CATL had received government approval to reopen its biggest mine, sparking oversupply worries.
The defence sector, specifically counter-drone technology stocks continued their remarkable run yesterday, continuing its momentum from the EU’s recent commitment to the drone wall along its Eastern flank. DroneShield (ASX:DRO) surged 21%, while fellow company in the space Elsight (ASX:ELS) added 29%.
What to watch today:
- Looking ahead to today, the SPI futures indicate that the ASX200 will open up 0.5% tracking the recent gains overseas recently.
- In commodities, crude oil is trading down 1.02% today at $61 us dollars and 73 cents per barrel. Gold is trading up another 0.07% at 3861 US dollars per ounce, and silver is trading up another 1.27% at 47 US dollars per ounce, adding to its over 7% surge so far this week.
Trading Ideas:
- Bell Potter has maintained its Buy rating on Mineral Resources (ASX:MIN) and upgraded its price target to $49 per share on the back of its strong expected cash flow from iron ore sales.
- Trading Central have identified a bullish signal in Clinuvel Pharmaceuticals (ASX:CUV), indicating that the share price may rise from its current closing price of $12 per share, to the range of $15.10 to $15.90 over a period of 25 days, according to the standard principles of technical analysis.
Wall St closed higher on Tuesday as investors overlooked government shutdown fears to post an unusually strong month of September. The Dow Jones rose 0.18% to close at a fresh record high while the Nasdaq added 0.31% and the S&P500 ended the day up 0.41%.
With a potential government shutdown looming, investors have been wary about a slowing labour market, the risk of stagflation and elevated stock valuation, so although government shutdowns aren’t usually market-moving events, this time we could see market movements as a result. In Europe overnight, markets closed higher led by Germany’s DAX rising 0.57%, while the STOXX 600 gained 0.5%, the French CAC climbed 0.19% and, in the UK, the FTSE100 ended the day up 0.54%.
Across the Asia markets on Tuesday, markets traded mixed as the latest data out of China showed manufacturing activity contracted for a 6th straight month, with the manufacturing PMI index coming in at 49.8 points. While still in contraction mode, the reading was better than economists were expecting and the strongest reading since March. Japan’s Nikkei fell 0.25%, and South Korea’s Kospi index lost 0.19%, while China’s CSI index gained 0.45%, and Hong Kong’s Hang Seng rose 0.95%.
The local market closed 0.2% lower on Tuesday following a lacklustre session on Wall St on Monday and investors digested comments out of RBA Governor Michele Bullock after Australia’s central bank maintained the current cash rate at 3.6% for the next period. Materials and industrials stocks bucked the trend yesterday to close higher while energy stocks were the hardest hit amid declining oil prices.
Ms Bullock said market services inflation remains sticky and has been a key sticking point for the RBA’s rate journey over the last year adding to the difficult decisions made around Australia’s rate outlook pathway. For this reason, the RBA was content in holding the cash rate at the conclusion of yesterday’s meeting for the period ahead.
Seven West Media (ASX:SWM) and Southern Cross Media (ASX:SXL) shares rose over 7% and over 6% respectively yesterday on news of a proposed merger between the Australian media giants, while Restaurant Brands New Zealand soared almost 60% after receiving a takeover offer from its majority shareholder, Finaccess Restauracion, a Mexican company.
What to watch today:
- On the commodities front this morning, oil is trading 1.5% lower at US$62.51/barrel, gold is up 0.33% at yet another record US$3845.83/ounce and iron ore is trading 0.09% lower at US$105.35/tonne.
- The Aussie dollar has further strengthened against the greenback overnight to buy 66.16 US cents, 97.82 Japanese Yen, 49.17 British Pence and 1 New Zealand dollar and 14 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down 0.12%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Pantoro (ASX:PNR) from $2.15 to $2.80 and maintain a hold rating on the diversified mining services group as shares have climbed 130% in one year but some key catalysts and tailwinds including the gold price and new contract wins, are driving a strong growth outlook for the company which led the analyst to increase the 12-month PT and maintain a hold.
- And Trading Central has identified a bearish signal on Infratil (ASX:IFT) following the formation of a pattern over a period of 54-days which is roughly the same amount of time the share price may fall from the close of $10.73 to the range of $9.40 to $9.70 according to standard principles of technical analysis.
Wall St closed higher across the major averages on Monday as investors bought back into the AI darlings a week after scepticism rose around the sustainable growth of the sector. The S&P500 gained 0.2%, the Nasdaq rose 0.48% and the Dow Jones ended Monday’s session up 0.15%. Shares of game maker EA Games rallied 4.5% after the company announced it’s going to be taken private in an acquisition worth US$55bn.
In Europe overnight markets closed higher to start the new trading week in the green. The STOXX600 rose 0.34%, Germany’s DAX added 0.02%, the French CAC climbed 0.13% and, in the UK, the FTSE100 ended the day up 0.16%.
Across the Asia region on Monday markets closed mixed with Japan’s Nikkei falling 0.69%, while South Korea’s Kospi index added 1.33%, Hong Kong’s Hang Seng added 1.9% and China’s CSI index gained 1.54%.
Locally to start the new trading week, a healthcare rebound pushed the ASX to a positive close with the key index rallying 0.9% while the spot price of gold also reset a fresh record, propelling gold miners to new heights.
Defence stocks were all the rage for investors yesterday with DroneShield soaring over 18% while EOS climbed almost 13% amid a tense backdrop in Europe with NATO boosting air-defence assets in response to new drone incursions at a key military base in Denmark last week. EOS also released a sales update yesterday revealing it is expecting full year revenue from existing contracts to be $115m to $125m in FY25 however, new orders could boost this by $25m in addition to its contract backlog with an estimated value of $299m.
Synlait Milk share jumped 15% following the release of the company’s full-year results yesterday. The dairy processor reported a more than twofold increase in underlying EBITDA, reaching NZ$107.2 million for FY 2025. Additionally, Synlait announced an agreement to sell its North Island assets to global healthcare giant Abbott Laboratories in a deal expected to generate around NZ$307 million in proceeds.
What to watch today:
- On the commodities front this morning oil is trading 3.86% lower at US$63.18/barrel; gold is up 1.63% at a fresh record US$3829/ounce and iron ore is down 0.09% at US$105.35/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.78 US cents, 97.75 Japanese yen, 48.91 British pence and 1 New Zealand dollar and 14 cents.
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.17%.
Trading Ideas:
- Bell Potter has raised the 12-month price target on Electro Optic Systems (ASX:EOS) from $5.70 to $11 and maintain a buy rating on the Australian defence manufacturer specialising in advanced weapon systems and satellite tracking technology company following an update out yesterday including revenue guidance weaker than Bell Potter expected in the near term but strong tailwinds driving the long-term growth of the sector. Bell Potter has upgraded the 12-month TP reflecting a higher CY26e EV/EBITDA multiple due to strengthened confidence in longer term revenue growth.
- Trading Central has identified a bearish signal on HMC Capital (ASX:HMC) following the formation of a pattern over a period of 29-days which is roughly the same amount of time the share price may fall from the close of $3.23 to the range of $2.55 to $2.65 according to standard principles of technical analysis.
Wall St closed higher on Friday after personal consumption price index, the Fed’s preferred measure of inflation, came in as expected at 2.9% for the month of August. The major indices snapped a 3-day losing streak on Friday with the S&P500 rising 0.6%, while the Nasdaq added 0.44% and the Dow Jones ended the day up 0.65%, but for the week the key indices each posted a loss.
In Europe on Friday markets closed mostly higher led by the French CAC and FTSE 100 rising 0.97% and 0.96% respectively while the STOXX 600 added 0.8% and Germany’s DAX ended the day up 0.87%.
Across the Asia region on Friday markets closed lower as investors assessed the 100% healthcare tariffs announced by Trump and continue to monitor trade tensions between the world’s largest economies. Hong Kong’s Hang Seng fell 1.35%, India’s Nifty 50 declined 0.95%, Japan’s Nikkei lost 0.87% and South Korea’s Kospi index ended the day down 2.45%.
Locally on Friday the ASX200 posted a 0.17% rise on Friday as a materials rally offset weakness among healthcare and utilities stocks.
Healthcare stocks tumbled on Friday after President Trump announced 100% tariffs on pharmaceutical companies.
Pro Medicus (ASX:PME), CSL (ASX:CSL) and Telix (ASX:TLX) dropped between 2% and 3% on Friday, and even Mesoblast (ASX:MSB) and Clarity Pharmaceuticals (ASX:CU6) were caught up in the sell off despite both companies confirming their products were exempt from the new tariffs.
Vulcan Energy (ASX:VUL) jumped 15% on a new contract signing to the value of $179m with a consortium to develop and build a geothermal power plant in Germany, while IperionX (ASX:IPX) rose 5.4% after receiving an additional US$25m award from the US department of War to strengthen the country’s defence strategy.
What to watch today:
- On the commodities front this morning oil is trading 0.32% higher at US$65.19/barrel, gold is up 0.5% at US$3768/ounce and iron ore is down 0.09% at US$105.44/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.45 US cents, 97.92 Japanese yen, 48.91 British pence and 1 New Zealand dollar and 13 cents.
- Ahead of Monday’s trading session, the SPI futures are anticipating the ASX will open the day up 0.24%
Trading Ideas:
- Bell Potter has increased the rating on Pantoro Gold (ASX:PNR) from a sell to a hold and have raised the 12-month price target on the gold production and development company from $4.40 to $5.35 following the release of the company’s FY25 results including a $112m turnaround from a $46m loss in FY24 to a $66m profit in FY25. PNR has demonstrated a step-change in cash generation and is on track for gold production growth YOY, as well as multiple production sources are now established, de-risking the outlook which led to the rating upgrades.
- And Trading Central has identified a bullish signal on Karoon Energy (ASX:KAR) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $1.73 to the range of $1.87 to $1.91 according to standard principles of technical analysis.
September’s volatility carried into this week, with global AI concerns, inflation, and visa uncertainties weighing on sentiment. Meanwhile, gold surged to record highs, giving local miners a boost.
In this week’s wrap, Grady covers:
- (0:12): Global market volatility and gold hitting new record highs
- (0:35): Australia’s latest monthly CPI print and implications for the RBA
- (2:30): unemployment holding at 4.2% and what this means for stability
- (2:58): GDP growth of 0.6% QoQ and signs of a rebound in per capita terms
- (4:45): how the ASX200 performed this week so far
- (5:35): most traded stocks and ETFs by Bell Direct clients this week
- (6:07): key data to watch next week – RBA decision, trade balance, US jobs & China PMI
Wall St continued its slide overnight, with all 3 of the major indices closing in the red for the second straight day. Investors continue to pull back from the AI industry with Nvidia sliding 1% and Oracle nearly 2%, as concerns about overvaluation persist. The broader market closed down 0.28%, the Dow Jones fell 0.37%, and the Nasdaq ended the session down 0.34%, as the AI slide was countered by a nearly 6% surge for Intel, after Bloomberg reported the chipmaker is seeking an investment from Apple.
Europe saw a mixed session overnight – the UK’s FTSE and German DAX both saw overnight gains or 0.29% and 0.23% respectively, while the French CAC fell over half a percent, and the broader STOXX 600 closed down 0.19%.
Locally yesterday, the ASX saw its worst trading day in 3 weeks, ending the session with a 0.92% decline. A large catalyst for the drop was ABS report that consumer prices rose 3.0% in the year to August, which was higher than economists had predicted – indicating that inflation remains sticky. 9 of the 11 major sectors closed lower, with only energy and utilities seeing gains, largely driven by a rise in oil prices. The financial sector took the biggest hit, especially the big 4 banks, which all slid between 1.5% and 3% on the day.
What to watch today:
- Looking ahead to today, the SPI futures indicate the ASX continue to slide, predicting a 0.47% drop at the open.
- In commodities, Crude Oil is trading up 2.09% at 64 US dollars and 73 cents per barrel after Donald Trump ramped up his hawkish rhetoric against Russia, sparking concerns about supply limitations.
- Gold is trading down 0.62% at 3740 US dollars per ounce, and Iron or is trading flat at $105.50 per Tonne.
Trading ideas:
- Bell Potter has maintained its buy rating on Regal Partners (ASX:RPL) and increased the target price from $3.55 per share to $4.10 per share, off the back of a report that the company’s end of August funds under management (FUM) reached $19.2billion, which beat forecasts.
- Trading Central have identified a bearish signal in Champion Iron (ASX:CIA), indicating that the stock price may fall from the close of $4.59 per share to the range of $3.30 to $3.50 per share over a period of 101 days, according to the standard principles of technical analysis.
In the US overnight Wall St closed lower as investors pulled back from the recent AI run on comments made by Fed Chair Jerome Powell around equity prices being highly valued at present. The S&P500 closed 0.55% lower in afternoon trade, while the Nasdaq saw the biggest fall of 0.95%, and the Dow Jones is closed 0.19% lower so far on Tuesday.
In Europe overnight it was a different story with markets closing in the green following the record strength on Wall St on Monday. The STOXX 600 rose 0.4%, Germany’s DAX added 0.36%, the French CAC climbed 0.54% and, in the UK, the FTSE100 ended the day flat.
Across the Asia region on Tuesday, markets closed mostly higher buoyed by a tech rally in the region after Nvidia announced a partnership with OpenAI. Taiwan’s Taiex index rose 1.42% to a record high, while South Korea’s Kospi index climbed 0.51%, Hong Kong’s Hang Seng fell 0.99% and India’s Nifty 50 ended the day down 0.13%.
The local market started the new trading week with an extension of last week’s rally as investor optimism has been boosted by strength on Wall St and the gold price soaring to new records which has boosted gold stocks to new heights. On Tuesday, the ASX200 posted a 0.4% gain at the closing bell as financial and materials stocks led the day’s winning sectors.
Myer (ASX:MYR) plunged over 30% on Tuesday after the department store giant released its FY25 results including a slight sales increase, but investors were more focused on responding to the 13.8% decline in EBIT while NPAT fell 30% YoY to $36.8m. The company also reported gross margins for Myer DS down 65bps due to a mix change toward concessions and promotional activity, and reported a statutory net loss of $211.2m primarily due to the acquisition of Premier Investments’ apparel brands in January.
Telix Pharmaceuticals (ASX:TLX) rallied a further 6% yesterday after announcing that the US Centres for Medicare & Medicaid Services has granted Transitional Pass-Through (TPT) payment status for Telix’s Gozellix drug candidate which is the company’s next-generation PSMA-PET imaging agent for prostate cancer.
What to watch today:
- On the commodities front this morning, oil is trading 1.97% higher at US$63.50/barrel, gold is up 0.84% at US$3778/ounce and iron ore is flat at US$105.49/tonne.
- Ahead of Tuesday’s trading session, the SPI futures are anticipating the ASX will open the day down 0.35% tracking Wall Street’s slide overnight.
Trading ideas:
- Bell Potter has maintained its hold rating on Technology One (ASX:TNE) and lifted its target price from $35.75 per share to $38.22 per share, ahead of its annual showcase event where the company’s new products and developments will be highlighted.
- And Trading Central have identified a bullish signal in Navigator Global Investments (ASX:NGI), indicating that the stock may rise from the close of $1.20 to the range of $2.43 to $2.51 over a period of 21 days, according to the standard principles of technical analysis.
Wall Street started the new trading week with some fresh records as big names like Nvidia boosted investor optimism about the future of AI. The S&P500 rose 0.44% to hit a fresh record high at the close while the Nasdaq jumped 0.7% and the Dow Jones ended the day up 0.14%. Nvidia shares rose 3.9% on Monday after announcing a partnership with OpenAI through the investment of $100bn to build out data centres.
Across European markets overnight it was mostly a sea of red as investors continue to assess President Trump’s visa crackdown. The STOXX 600 fell 0.5%, Germany’s DAX lost 0.48%, the French CAC fell 0.3% and, in the UK, the FTSE100 ended the day up 0.11%.
Across Asia markets on Monday, markets closed mixed as investors in the region also responded to Trump’s hefty H-1B visa fees. Indian tech stocks fell overnight 3% in response to the newly imposed visa fees, while Japan’s Nikkei rose 0.99%, Hong Kong’s Hang Seng fell 0.76%, and South Korea’s Kospi index gained 0.68%.
Locally to start the new trading week, the ASX200 posted a 0.43% gain amid a boost in commodity prices driving a rally for materials stocks, especially in the form of gold after the price of the precious metal hit yet another fresh recover overnight over US$3700/ounce.
Regis Healthcare (ASX:REG) shares plunged 26% on Tuesday after the company warned that the Federal Government’s 4.7% funding increase for aged care was below expectations and won’t cover rising staff costs, creating a funding gap. As a result, Regis downgraded its earnings outlook, guiding to only modest EBITDA growth (3–7%) for FY2025, disappointing investors and sparking a sharp sell-off on Monday.
What to watch today:
- On the commodities front this morning oil is trading 0.13% lower at US$62.32/barrel, gold is up a further 1.71% to a fresh record US$3747/ounce and iron ore is trading 0.05% at US$105.49/tonne.
- The Aussie dollar has strengthened against the greenback to buy 66.02 US cents, 97.50 Japanese yen, 47.06 British pence and 1 New Zealand dollar and 12 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.19% tracking Wall Street’s gains overnight.
Trading ideas:
- Bell Potter has initiated coverage of Generation Development (ASX:GDG) with a buy and a 12-month price target of $8.20. Generation Development Group (GDG) is a financial services company that offers a range of tax-effective investment solutions, annuities, managed accounts and research services. The analyst sees GDG as a Buy due to its transformative earnings growth, strategic acquisitions, strong managed accounts positioning, supportive regulatory tailwinds, and a major vote of confidence from BlackRock, all pointing to a long runway for scalable, high-margin growth.
- And Trading Central has identified a bullish signal on Acrow (ASX:ACF) following the formation of a pattern over a period of 337-days which is roughly the same amount of time the share price may rise from the close of $1.06 to the range of $1.30 to $1.36 according to standard principles of technical analysis.
Wall Street closed higher on Friday and for the week as investors welcomed the Fed’s rate cut decision on Thursday last week. The Nasdaq rose 0.72%, the S&P500 rallied 0.5% and the Dow Jones gained 0.37% to hit a fresh record at the close. For the week, the Nasdaq added 2.2% while the Dow and S&P500 gained 1% and 1.2% respectively.
Apple shares led the gains on Friday with a 3.2% spike after the company’s latest iPhone went on sale.
In Europe on Friday markets closed lower as investors focused on trade and the state of the European economy. The STOXX600 fell 0.04%, Germany’s DAX lost 0.15%, the French CAC declined just 0.01%, and, in the UK, the FTSE100 ended the day down 0.12%.
Across the Asia region on Friday markets closed lower after the Bank of Japan held rates steady amid concerns of external volatility impacting Japan’s inflation journey. Hong Kong’s Hang Seng closed flat, India’s Nifty 50 declined 0.55%, and Japan’s Nikkei fell 0.57%.
Locally on Friday the ASX200 posted a positive end to the week amid fresh records on Wall St on Thursday and a healthcare rally locally fuelling a 0.3% gain at the closing bell.
For the week, the key index lost 1.03% as a sharp sell off in energy stocks weighed down the key index.
Telix Pharmaceuticals (ASX:TLX) did much of the heavy lifting in the healthcare sector on Friday with a 7.5% rally after Citi initiated coverage of the commercial-stage biopharmaceutical company with a buy rating, indicating its prostate cancer drug candidate has the potential to become a ‘blockbuster drug’.
Pro Medicus (ASX:PME) also benefited from Citi’s expanded coverage with a rally of 5.5% after Citi named PME among its favourite stock picks for the healthcare sector.
What to watch today:
- Gold miners locally extended their run on Friday as the recent gold spot price rally continued with the price of gold topping US$3659 on Friday. Northern Star Resources added 0.9% on Friday while Evolution Mining ended the day up 1.52%.
- On the commodities front this morning oil is trading 1.34% lower at US$62.72/barrel, gold is up 1.12% at US$3684.75/ounce and iron ore is up 0.2% at US$105.44/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy 65.96 U.S. cents, 97.63 Japanese yen, 48.85 British pence and 1 New Zealand dollar and 12 cents.
- Ahead of Monday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.27% tracking Wall Street’s gains on Friday.
Trading ideas:
- Bell Potter has initiated coverage of Orica (ASX:ORI) with a buy rating and a 12-month price target of $23.00 as the analyst sees Orica is well-positioned for strong near-term earnings growth across its diversified segments, driven by high-margin products, favourable pricing, and operational improvements. Additionally, the company is on track for de-leveraging and increasing shareholder returns, making it an attractive investment opportunity.
- And Trading Central has identified a bullish signal on ResMed (ASX:RMD) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $41.21 to the range of $45.30 to $46.20 according to standard principles of technical analysis.
This edition of the weekly wrap brings you a special insights package direct from the Resources Rising Stars conference. Over two days, we caught up with some of the industry’s mining magnates and emerging leaders to discuss the outlook for gold, copper, uranium, and lithium, along with company updates from the helm.
You can view highlights from the conference in this week’s video.
In this week’s wrap, Grady covers:
- (1:11): Tim Goyder on Minerals 260’s gold strategy
- (3:01): Bill Beament on Develop Global’s copper outlook
- (4:49): new gold explorers Arika Resources & Gorilla Gold
- (6:38): Firefly Metals’ copper-gold project and share price rally
- (7:32): FY26 commodity outlooks: gold, copper, uranium, lithium
- (8:12): how the local market performed over the last trading week
- (9:04): the most traded stocks and ETFs by Bell Direct clients this week
- (9:36): key economic data to watch next week.
The big news out of the US overnight was confirmation that the Fed would deliver its widely expected 25 basis point rate cut. Fed Chair Jerome Powell in his press conference said the move should be considered a “risk management cut”, in response to the weakening job market, and growing inflationary pressures.
In response to the cut, Wall Street saw a volatile trading session close mixed overnight. The Dow Jones soared 0.57%, boosted by stocks which benefit from the rate cut, such as Walmart, JP Morgan and American Express.
On the other end, the S&P 500 closed down 0.1%, and the NASDAQ saw a 0.33% decline as investors took profits from the high flying tech stocks, with big names like Nvidia, Oracle and Palantir all slipping.
Europe also saw a mixed session overnight - the FTSE and German DAX both saw gains overnight, closing 0.14 and 0.13% higher respectively. Meanwhile, the French CAC declined 0.4%, and the Stoxx600 closed slightly down 0.03%
It was a tough day locally as the ASX 200 closed down 0.67%, with 8 of the 11 key sectors in the red. The real estate and consumer discretionary sectors were hit the hardest, which can likely be attributed to the fact that these are the most sensitive sectors to interest rate cuts, and so investors were bailing out prior to the fed announcement.
What to watch today:
- Looking forward to today, the SPI futures suggest the ASX will continue its slide, opening down 0.17% for the trading session.
- In commodities, Crude Oil is trading 0.85% lower at 63 US dollars and 97 cents per barrel. Similarly, gold is trading 0.86% lower at 3659.
- US dollars and 87 cents per ounce, and Iron Ore is trading 0.11% lower at 105 US dollars and 30 cents per tonne.
Trading Ideas:
- Bell Potter has maintained its buy recommendation for cardiac therapy producers EBR Systems (ASX:EBR) with a target price of $2.25 per share, as they recently cleared the final hurdle towards a successful commercial launch of their cardiac rhythm disease treatment WiSE.
- Trading Central have identified a bearish signal in Steadfast Group (ASX:SDF), indicating that the stock price may fall from the close of $6.07 per share to the range of $5.56-$5.66 per share over a period of 9 days, according to the standard principles of technical analysis.
The US overnight saw a decline with all 3 of the major indexes closing in the red, as investors take some profits ahead of the Fed’s highly anticipated rate decision. The S&P500 closed down 0.13%, the Nasdaq fell 0.07% and the Dow Jones saw the biggest decline, ending the day down 0.27%
Across European markets overnight it was a sea of red with the STOXX 600 falling 1.2%, while Germany’s DAX tumbled 1.8%, the French CAC fell 1% and, in the UK, the FTSE100 ended the day down 0.88%.
Asian markets closed Tuesday’s session higher as progress on trade talks between China and the US continued to boost investor sentiment for a second session in the region. Japan’s Nikkei rose 0.3% to top 45,000 index points for the first time ever, while South Korea’s Kospi index rose 1.24% to also reset its record high, India’s Nifty 50 also gained 0.68% and Hong Kong’s Hang Seng ended the day flat.
The local market started the new trading week lower before recovering ground to close 0.28% higher on Tuesday as a surge in energy and discretionary stocks offset weakness among healthcare stocks.
Investors welcomed comments out of the RBA on Tuesday signalling Australia’s central bank has nearly achieved its inflation goal, successfully bringing inflation close to target while maintaining low unemployment and easing cost-of-living pressures, with wages now outpacing prices.
Super Retail Group (ASX:SUL) fell 4.3% on Tuesday after the managing director and CEO was let go over a personal event.
What to watch today:
- On the commodities front this morning:
- Oil is trading 1.92% higher at US$64.52/barrel
- Gold is up 0.3% at US$3689/ounce
- Iron ore is up 0.1% at US$105.42/tonne
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down 0.45% tracking Wall Street’s sell-off on Tuesday.
Trading ideas:
- Bell Potter have maintained their buy rating on gold miner Alkane Resources (ASX:ALK), and increased their 12-month target price to $1.45 per share off the back of its recently completed merger with Canadian listed gold producer Mandalay Resources. At it current share price of around $1 per share, this implies a 45% share price growth in a year.
- And Trading Central have identified a bullish signal in Universal Store Holdings (ASX:UNI), indicating that the share price may rise from the close of $8.50 per share to the range of $11.20 to $11.80 per share over a period of 229 days according to the standard principles of technical analysis.
Positive trade talks between China and the U.S. boosted investor sentiment on Wall Street on Monday, leading to a positive finish across the major averages. The S&P500 climbed 0.5% to a fresh record high over 6000 points for the first time while the Nasdaq added 0.9% to also hit a fresh record close and the Dow Jones ended the day up 0.1%. U.S. and Chinese officials met for a second day with progress on the trade front said to be moving well on top of talks around the sale of Chinese owned social media company, TikTok.
In Europe overnight markets closed mostly higher as investors welcome trade negotiation progress between the U.S. and China. The STOXX600 rose 0.4%, Germany’s DAX added 0.2%, the French CAC climbed 1% and, in the UK, the FTSE100 ended the day down 0.1%.
Across the Asia region on Monday markets closed mixed with Hong Kong’s Hang Seng rising 0.23%, while China’s CSI index gained 0.24%, South Korea’s Kospi index rose to a fresh record high with a gain of 0.35%, and Japan’s Nikkei was closed for a holiday.
Locally on Monday the ASX200 posted a 0.13% loss to start the new trading week lower.
The losses extended from last week as investors overlooked the widely expected US rate cut announcement next week and instead sold out of healthcare and gold mining stocks to start the new trading week lower.
The most traded stocks by Bell Direct clients yesterday were led by Mineral Resources (ASX:MIN), CSL (ASX:CSL) and Westpac (ASX:WBC).
What to watch today:
- On the commodities front this morning, oil is trading 1.2% higher at US$63.31/barrel, gold is up a further 1.07% at US$3681/ounce and iron ore is trading 0.11% lower at US$105.31/tonne.
- The Aussie dollar has strengthened against the greenback to buy 66.73 U.S. cents, 98.32 Japanese yen, 49.04 British pence and 1 New Zealand dollar and 12 cents.
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up almost half a %.
Trading ideas:
- Trading Central has identified a bullish signal on Adairs (ASX:ADH) following the formation of a pattern over a period of 12-days which is roughly the same amount of time the share price may rise from the close of $2.62 to the range of $3.15-$3.30 according to standard principles of technical analysis.
- And Trading Central has identified a bearish signal on The A2 Milk Company (ASX:A2M) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may fall from the close of $9.10 to the range of $8.30 to $8.45 according to standard principles of technical analysis.
Wall Street closed mixed on Friday as investors remain optimistic of a rate cut out of the Fed this week after core US inflation remained steady at 3.1% in August. The Nasdaq had a perfect week, notching another record close on Friday by ending the day up 0.44% while the S&P500 hovered flat most of the day before settling up just 0.05%, and the Dow jones ended the day down 0.59%.
The S&P 500 gained 1.6% for the week, marking its strongest weekly showing since early August and its fifth advance in the past six weeks. The Nasdaq notched a second straight week of gains with a 2% rise, while the Dow climbed 1% for the week, breaking a two-week losing streak.
In Europe on Friday markets closed flat as fresh economic data out of the UK showed economic growth stalled in July. The STOXX600 closed the session flat, Germany’s DAX lost just 0.02%, the French CAC added just 0.02%, and, in the UK, the FTSE100 ended the day down 0.15%.
Across the Asia region on Friday, markets closed mostly higher tracking Wall Street gains on Thursday. Japan’s Nikkei added 0.9%, Hong Kong’s Hang Seng climbed 1.14%, China’s CSI index fell 0.57%, and India’s Nifty 50 ended the day up 0.43%. Alibaba shares soared over 7% on Friday after the company initiated moves to secure its place in China’s AI boom.
What to watch today:
- Locally to end the last trading week the ASX200 posted a 0.68% rise on Friday as a materials led rally boosted the key index to a strong finish on Friday.
- Gold stocks were a key standout over the last trading week as the price of the precious commodity soared to fresh record highs throughout the week, topping US$3674/ounce. Regis Resources (ASX:RRL) soared 6.4% on Friday while Ramelius Resources (ASXRMS) added 2.8% and Bellevue Gold (ASX:BGL) ended the day up over 7%.
- The most traded stocks by Bell Direct clients on Friday were led by healthcare companies in 4D Medical (ASX:4DX), CSL (ASX:CSL) and Pro Medicus (ASX:PME).
- On the commodities front this morning oil is trading 0.43% higher at US$62.56/barrel, gold is up 0.3% at US$3642.37/ounce and iron ore is up 0.24% at US$105.43/tonne.
- The Aussie dollar has weakened against the greenback to buy 66.52 US cents, 98.19 Japanese yen, 48.96 British pence and 1 New Zealand dollar and 12 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the new trading week down 0.67%.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Select Harvests (ASX:SHV) from $5.30 to $5.45 and maintain a buy rating on the almond producer following a rebound in almond pricing, with a rally of prices up around 26% from the bottom to now sit around US$3.11/pound.
- And Bell Potter has also increased the 12-month price target on Jumbo Interactive (ASX:JIN) from $11.20 to $11.50 and maintain a hold rating on the e-commerce digital lotteries business following the company announcing it has entered into a long-term software licence agreement with RSL Queensland to power RSL Queensland’s flagship Dream Home Art Union lottery program.
With the ASX200 recovering some of September's lost ground this trading week, this week's wrap collates the key insights from Bell Potter's analysts that joined us this week for our webinar, Managing Market Volatility, where we unpacked the key highlights and lowlights of reporting season, discussed tactics to navigate volatility and provided outlook for FY26. You can view some of the highlights in this week’s video, and below is the link to the full recording of the webinar in case you missed it live.
Webinar link - Managing Market Volatility with Grady Wulff, Chris Savage, Rob Crookston and John Hester: https://youtu.be/vSm9tnwr0-I
In this weekly wrap Grady covers:
- (0:30): how the ASX recovered some ground this trading week
- (1:30): Rob Crookston's outlook for FY26 & key reporting season findings
- (3:24): Chris Savage's analysis & tech valuations of FY25 reporting season
- (4:48): Chris’ outlook for tech and two smaller names to watch in FY26
- (5:44): John Hester’s findings from the healthcare sector this reporting season
- (6:52): how the local market performed over the last trading week
- (7:51): the most traded stocks and ETFs this week
- (8:22): economic calendar news items to look out for next week – China and US in focus.
In the US, Wall St saw a mixed trading session overnight. The S&P500 and NASDAQ both closed at fresh record highs, with a 0.3% gain for the former and a 0.03% gain for the latter. In contrast, the Dow Jones saw a decline of 0.48%, largely bogged down by a tough day for Apple shares as the new iPhone announcement failed to impress investors.
Europe also saw a mixed session. The Stoxx600 edged slightly down 0.02%, the FTSE ended down 0.19%, the DAX saw the biggest decline, ending down 0.36%, while the French CAC actually advanced 0.15%.
Locally yesterday the ASX200 advanced 0.31%, with 9 of the 11 key sectors closing in the green. The market was weighed down by a tough day for material stocks, which fell 1.7% off the back of news that Chinese lithium mining giant CATL will resume operations in its Jianxi mine earlier than expected, causing Pilbara Minerals (ASX:PLS) and Liontown Resources (ASX:LTR) to tank 18% each.
What to watch today:
- The SPI futures indicate the ASX200 will open the trading session down 0.23%.
- In commodities, Crude Oil saw a 1.65% price jump to 63 US dollars and 66 cents overnight as Poland downed drones in its airspace, and the US pushed for new sanctions on buyers of Russian oil, sparking worries about possible supply disruptions.
- Meanwhile, gold prices continue to increase, trading up 0.43% to 3642 US dollars and 90 cents per ounce, while iron ore is trading down 0.26% to 105 US dollars and 80 cents per tonne.
Trading ideas:
- Bell Potter has maintained their buy rating on agricultural chemicals supplier Nufarm (ASX:NUF) off the back of solid earnings season results. With a target price of $3.55 per share, this implies a 44% increase over 12 months from the current share prices of $2.28.
- Trading Central have identified a bearish signal in BlueScope Steel (ASX:BSL), indicating that the stock price may fall from the closing price of $22.20 per share to the range of $20-20.40 over a period of 17 days, according to the standard principles of technical analysis.
The three major averages on Wall St rose to record territory on Tuesday as investors looked past current concerns over the US economic stability and bought into market opportunities. The Dow Jones rose added 0.43%, the S&P500 climbed 0.27% and the tech-heavy Nasdaq ended the day up 0.37%. Revisions to payrolls data of late has been the key catalyst spooking investors with the latest revision by the labour department coming in at a reduction of 911,000 for the 12-months to March this year signalling weakness in the US labour stability.
In Europe overnight, markets closed mostly higher with the STOXX600 rising 0.09%, while Germany’s DAX fell 0.37%, the French CAC added 0.23% and, in the UK, the FTSE100 ended the day up 0.23%.
Across the Asia region on Tuesday, markets closed mixed with Japan’s Nikkei falling 0.42% while South Korea’s Kospi index gained 1.26%, Hong Kong’s Hang Seng rose 1.19% and China’s CSI index fell 0.7%.
The local market sell-off to start September has extended into the new trading week with the key index ending Tuesday’s session down 0.52% as investor sentiment has been hit lately by further tariff, US economic and rate outlook uncertainty.
Westpac consumer confidence data for September and NAB business confidence data for August were also both released yesterday with declines in both readings more than economists were expecting amid uncertainty on an economic level.
Energy stocks continued their slide this week following OPEC+’s weekend decision to increase production of oil starting in October.
Telix Pharmaceuticals (ASX:TLX) gained over 2% after reaching a deal with the US Food and Drug Administration to file a revised application for its brain cancer imaging agent, incorporating further clinical data.
What to watch today:
- On the commodities front this morning oil is trading 0.71% higher at US$62.71/barrel, gold is up 0.12% at US$3640/ounce and iron ore is up 0.42% at US$104.93/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.84 US cents, 97.06 Japanese Yen, 48.62 British Pence and 1 New Zealand dollar and 11 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down 0.05%.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Lynas Rare Earths (ASX:LYC) from $7.65 to $9.35 and maintain a sell rating on the leading rare earths producer following the company highlighting its ‘Towards 2030 strategy’. The analyst sees LYC is priced for perfection, with little room for error, highlighting FY25 had higher depreciation which drove a miss on results, however, does recognise that the current themes pushing LYC higher are likely to persist as tailwinds over the short term.
- And Trading Central has identified a bearish signal on Breville Group (ASX:BRG) following the formation of a pattern over a period of 33-days which is roughly the same amount of time the share price may fall from the close of $30.89 to the range of $25 - $26.25 according to standard principles of technical analysis.
In the US, Wall Street advanced overnight, with all 3 of the key indexes in the green. The Dow Jones ended the day 0.25% higher, the S&P500 gained 0.21%, while the tech heavy nasdaq was the biggest winner, advancing 0.45% - mainly driven by a solid start to the week from giants Nvidia and Microsoft.
Europe also saw gains overnight – the stoxx600 closed 0.52% higher, the FTSE gained 0.14%, the French CAC saw a 0.78% increase, while the German Dax took the biggest step, ending the day up 0.89%.
Locally yesterday, the September sell-down continued as the ASX200 fell another 0.24% to open the new trading week. With 8 of the 11 key sectors in the red, information technology was one of the few areas gaining any traction, driven by a 6% rally for Life360 (ASX:360), and a 1.9% jump for Wisetech Global (ASX:WTC).
What to watch today:
- Looking ahead to today, despite the rally overseas the ASX is set to fall further, with SPI futures indicating a 0.35% decline at the open.
- In commodities, Gold remains the biggest story as it hit a fresh all time high on Monday crossing the $3600 US dollars per ounce threshold for the first time. It is currently trading up 1.15%, at 3634 us dollars and 10 cents per ounce. Demand for gold continues to grow primarily from the economic data coming out of the US – as data showed that unemployment has reached its highest level since 2021, while fewer jobs than expected were added in August.
- Crude oil is also trading higher, up 0.9% to 62 us dollars and 43 cents per barrel, while iron ore is trading 0.42% higher at 104 us dollars and 93 cents per tonne.
Trading Ideas:
- Bell Potter has placed a speculative buy rating on biotechnology company PYC Therapeutics (ASX:PYC), with a target price of $2.30 per share. At the current share price of $1.25 per share, this implies a 12 month return of nearly 85%.
- Bell Potter has maintained their hold rating on Solvar Limited (ASX:SVR), with the 12 month price target of $1.70 implying just a 3% growth on the current share price of $1.65 per share.
Wall Street closed lower on Friday as investor fears of a slowing economy rose after key U.S. non-farm payrolls data came in much weaker than expected. The Dow lost 0.5%, the Nasdaq declined 0.03% and the S&P 500 ended the day down 0.32%.
For the month of August nonfarm payrolls increased by only 22,000 jobs, significantly lower than the 75,000 jobs economists were expecting to be added. U.S. unemployment rate also rose to 4.3% for the month, up from 4.2% signalling a weakening labour market.
While a rate cut out of the Fed is almost certain now, investors are more concerned over the long-term impact of a slowing economy, and fears of a recession continue to rise.
In Europe on Friday markets closed lower as investors in the region also assessed the weakening economic condition of the U.S. following a weaker than expected jobs reading out on Friday. The STOXX 600 fell 0.2%, Germany’s DAX lost 0.73%, the French CAC declined 0.31%, and in the UK, the FTSE100 ended the day down 0.09%.
Across the Asia region on Friday markets closed mostly higher after President Trump formalised lower tariffs on Japanese auto tariffs with a baseline tariff of 15% across all Japanese imports. Japan’s Nikkei rose 1.03%, Hong Kong’s Hang Seng gained 0.71% and South Korea’s Kospi index added 0.13%.
Locally on Friday the ASX200 posted a 0.51% rise on Friday as real estate and discretionary stocks rose 1.37% and 1.33% respectively.
Gold stocks gained further ground on Friday amid the record price of the precious commodity as investors once again flocked to safe-haven assets in the wake of further global uncertainty.
Qantas (ASX:QAN) shares rose 1.5% on Friday on news that chief executive Vanessa Hudson’s bonus would be docked over the airline’s recent cybersecurity breach, while Orica shares added over 1% after the company signalled positive momentum is driving higher underlying earnings across its business for H2 ending September 30.
What to watch today:
- On the commodities front this morning oil is trading 2.38% lower at US$61.97/barrel, gold is up 1.3% at US$3592.50/ounce, and iron ore is down 0.04% at US$104.49/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.57 U.S. cents, 97.10 Japanese yen, 48.53 British pence, and 1 New Zealand dollar and 11 cents.
- Ahead of the first session of the new trading week the SPI futures are anticipating the market will open the day down 0.2%.
Trading ideas:
- Bell Potter has increased the rating on Technology One (ASX:TNE) from a sell to a hold and have maintained the 12-month price target on the company at $35.75/share, amid changes in forecasting for the company with Bell Potter’s analyst and the market anticipating a beat in November. At a stock specific level, we do not see much risk of any disappointment or negative catalyst and, as mentioned, we already expect the company to exceed its guidance when it reports in November.
- And Bell Potter has also reduced the rating on Curvebeam AI (ASX:CVB) from a spec buy to a hold and have a 15cps price target on the company following the release of the company’s FY25 results including revenues and gross profit of $12.1m and $6.7m respectively. The reason for the downgrade to a hold comes from lack of guidance, Hi rise device sales continuing to be constrained by the Mako validation matter and the hybrid of capitalised earnings.
August reporting season closed with just 20–30% of companies beating expectations, as investors rewarded certainty in dividends, guidance, and cost control while punishing cautious outlooks. Standouts included Northern Star, Goodman Group, and JB Hi-Fi, while Woolworths, CSL, and James Hardie lagged on guidance misses. Looking to FY26, rate cuts, AI, gold, and resilient retailers are set to drive opportunity, but disciplined execution will be key.
In this week’s wrap, Grady covers:
- (0:16): a look back at reporting season as a whole
- (1:03): why investors are valuing clarity and strong guidance
- (2:03): a dive into some key sectors, including retail, gold and real estate
- (5:22): the themes shaping FY26’s outlook
- (7:05): how the local market performed over the last trading week
- (7:32): the most traded stocks and ETFs this week
- (8:00): economic news items to look out for next week.
In the US, Wall Street closed mixed overnight. The Dow Jones ended the day marginally down with a 0.05% decline, while the S&P500 gained 0.51% and the tech heavy NASDAQ advanced 1.02%, driven by strong gains from Alphabet and Apple.
Europe also saw a rebound overnight: the Stoxx600 closed up 0.66%, the FTSE gained 0.67%, the German DAX advanced 0.46% and the French CAC was the biggest winner, ending the day up 0.86%
Locally yesterday the ASX200 saw its worst day since April’s Liberation day, closing down a sharp 1.82%, with all 11 key sectors in the red. The sell off was primarily driven by rising bond yields in the global bond market – as investors are less willing to pay high prices for stocks with higher risk potential when bonds are paying higher interest rates.
What to watch today:
- The SPI futures suggest the ASX200 will rally after a few consecutive days of losses and open up 0.41% - tracking overseas gains overnight
- In commodities:
- Crude oil has dropped 2.77% to 63.77 US dollars per barrel, ahead of weekend meeting of OPEC producers that is expected to increase production targets in October
- Gold has continued its record run, rising another 0.7% to a fresh high of 3559.47 US dollars per ounce. This renewed gold rally comes as investors seek a safe haven amid continuing expectations of a fed rate cut this month, further concerns over US debt levels, and renewed uncertainty around the US tariff implications and outlook.
- Meanwhile, iron ore has risen 0.69% to 103.24 US dollars per tonne.
- Also today BHP (ASX:BHP) will go ex-dividend, so investors may notice a drop in the share price of around the dividend value for this reason.
Trading ideas:
- Bell Potter has maintained its Buy rating on COG Ltd (ASX:COG) and raised the target price to $2.25 per share off the back of the company’s announcement of the 100% acquisition of EasiFleet Pty Ltd, effective September 1.
- And Trading Central have identified a bearish signal on Pro Medicus (ASX:PME), indicating that the stock price may fall from the close of $290.81 to the range of $235-$245 per share over a period of 52 days according to the standard principles of technical analysis.
Wall St closed lower on Tuesday to kick off the September trading month in the red as investors took profits from the summer bull rally and hold concerns over tariff uncertainty after a federal appeals court on Friday ruled that most of Trump’s global tariffs are illegal. The Nasdaq lost 0.82%, the S&P500 dropped 0.7% and the Dow Jones ended the day down 0.55%.
In Europe overnight, markets tumbled amid a rise in bond yields and the prospect of further tariff uncertainty out of the US. The STOXX 600 fell 1.5%, Germany’s DAX fell 2.2%, the French CAC lost 0.7% and, in the UK, the FTSE100 ended the day down 0.9%.
Across the Asia region on Tuesday, market sentiment was hit by tariff uncertainty leading to a mixed session in the region. Japan’s Nikkei rose 0.3%, India’s Nifty 50 gained 0.3%, South Korea’s Kospi Index rose 0.94%, and Hong Kong’s Hang Seng ended the day down 0.5%.
The local market started the new trading month lower with a 0.3% decline on Tuesday as investors digested the August reporting season showing a weaker outcome than expected for FY25 and repositioned portfolios for the tailwinds expected in FY26. Australia’s August reporting season delivered weaker-than-expected results, with only 20-30 % of companies beating earnings expectations compared with more than 80% in the US. Median earnings downgrades of 3.6% outpaced upgrades of 2% locally.
With some heavyweight market stocks trading ex-dividend yesterday and Wall St closed on Monday, investor moves were buoyed yesterday by strength among the banks and a rally among key commodity prices yesterday however this wasn’t enough to boost the ASX to a green finish.
Gold rose 1.4% to $3,496.24 per ounce, and silver surpassed $40 for the first time since 2011, driven by expectations the US Federal Reserve will cut interest rates in September, according to ANZ.
Collin’s Food (ASX:CKF) soared over 7% yesterday after posting a 6.7% rise in total sales for the first 18-weeks of FY26 and the KFC Australia operator also reaffirmed guidance for FY26 targeting underlying NPAT of low-mid teens.
What to watch today:
- On the commodities front this morning, oil is trading 1.33% higher at US$65.49/barrel, gold is up 1.5% at US$3528/ounce and iron ore is up 0.71% at US$102.53/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.13 US cents, 96.70 Japanese Yen, 46.82 British Pence, and 1 New Zealand dollar and 11 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down a sharp 0.42% tracking global market uncertainty overnight.
Trading ideas:
- Bell Potter has maintained a buy rating on Harvey Norman (ASX:HVN) and have increased the 12-month price target on the homewares retailer from $6.00 to $8.30 following the release of FY25 results beating expectations and a strong start to FY26 especially from within the Australian business.
- And Trading Central has identified a bearish signal on Supply Network (ASX:SNL) following the formation of a pattern over a period of 268-days which is roughly the same amount of time the share price may fall from the close of $36.02 to the range of $27.50 to $29.00 according to standard principles of technical analysis.
In the US, Wall Street was closed on Monday due to the Labour Day public holiday.
In Europe, markets closed generally higher, spurred by a boost in the defence sector. The Stoxx 600 closed up 0.17%, the FTSE gained 0.1%, the French CAC advanced 0.05% and the German DAX was the biggest gainer at 0.57%.
Locally yesterday, the ASX200 closed 0.51% lower with the majority of the key sectors in the red. Information Technology saw the biggest drop, closing down 2.65%, while on the other end consumer staples saw the biggest gain, closing up 0.35%.
What to watch today:
- Ahead of today’s trading session, the SPI futures are suggesting the ASX will open the day down 0.09%.
- In commodities,
- Crude oil is up 0.97% to 64.63 US dollars per barrel.
- Gold is up 0.78% to 3476.08 US dollars per ounce, around $23 shy of its all time high.
- While iron ore is trading lower, down 1.8% to 101.65 US dollars per tonne.
- Australia’s current account and export figures for Q2 are out at 11:30am AEST
- We’ll see earnings reporting from Bellevue Gold (ASX:BGL), while Northern Star Resources (ASX:NST) and Santos (ASX:STO) are set to go ex-dividend, which can often cause a drop in the share price of the dividend amount.
Trading Ideas:
- Bell Potter has maintained its buy rating on Iron Ore miner Fenix Resources (ASX:FEX) and increased the 12 month target price to $0.65, off the back of its new binding agreement with Sinosteel Midwest Corporation granting it the exclusive right to mine and export 290 megatonnes of iron ore over 30 years at SMC’s Weld Range Iron Ore project.
- Trading Central have identified a bearish signal in Breville Group (ASX:BRG), indicating that the stock price may fall from the close of $32.88 to the range of $28.10 - 29.00 over a period of 28 days according to the standard principles of technical analysis.
Wall Street closed lower on Friday but higher for August marking the 4th month of gains for the NYSE. On Friday, the S&P500 fell 0.64%, the Nasdaq lost 1.15%, and the Dow Jones ended the day down 0.2% as investors took money out of the market amid risks of inflationary pressures remaining persistent into the new month following the U.S. core PCE increasing 2.9% for July which was in-line with expectations but still showed acceleration of an inflation driver.
In Europe on Friday stocks moved lower as investors await key inflation data out in the region. The STOXX 600 fell 0.6%, Germany’s DAX also dropped 0.6%, the French CAC declined 0.8% and, in the UK, the FTSE100 ended the day down 0.3%.
Across the Asia region on Friday markets closed mixed as investors assessed key economic data out of Japan including Japan’s CPI rising at a slower pace in August. Japan’s Nikkei fell 0.26% on Friday while Hong Kong’s Hang Seng rose 0.45%, China’s CSI index added 0.74%, and South Korea’s Kospi index declined 0.32%.
Locally on Friday the ASX200 closed 0.08% lower as a sell-off in REIT and financial stocks offset a more than 3% rise in tech stocks. For the month of August though, the local market posted a 2.6% rise as investors responded to strong outlook for FY26.
Homewares retailer Harvey Norman (ASX:HVN) jumped over 10% on Friday after reporting profits rose 39% in FY25 which well exceeded market expectations while Austal (ASX:ASB) also soared over 14% amid a record order pipeline and shipbuilding agreement with the federal government.
What to watch today:
- On the commodities front this morning oil is trading 0.91% lower at US$64.01/barrel, gold is up 0.91% at US$3448.50/ounce and iron ore is up 0.1% at US$101.81/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.48 US cents, 96.30 Japanese yen, 48.46 British pence and 1 New Zealand dollar and 11 cents.
- Ahead of the first trading session of the new month the SPI futures are anticipating the ASX will open the day down 0.3%.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Lovisa from $31 to $42 (ASX:LOV) and maintain a hold rating on the fashion jewellery retailer following the release of the company’s FY25 results. Despite missing on NPAT, the new financial year has started very strong for Lovisa with global comparable sales up 5.6%.
- And Trading Central has identified a bullish signal on Ooh Media (ASX:OML) following the formation of a pattern over a period of 6-days which is roughly the same amount of time the share price may rise from the close of $1.68 to the range of $1.84 to $1.88 according to standard principles of technical analysis.
As August reporting season draws to a close, we saw plenty of big results move the markets this week. Supermarket giant Woolworths (ASX:WOW) tumbled over 10% on weak profit and margin pressure, facing pressure from its major competitor Coles. In contrast, Sigma Healthcare (ASX:SIG) impressed with its first post-merger results, Eagers Automotive (ASX:APE) delivered record revenue, and Qantas (ASX:QAN) soared on robust travel demand. Looking ahead to FY26, cost control, consumer shifts, and sector tailwinds are expected to drive momentum, with opportunities emerging across growth-focused mid-caps.
In this week’s wrap, Sophia covers:
- (0:15): an overview of the results over this reporting season
- (0:40): why Woolworth’s shares are tumbling
- (1:40): a dive into Sigma Healthcare, Eagers Automative and Qantas’ results
- (4:50): key themes heading into FY26
- (5:34): how the local market performed over the last trading week
- (7:00): the most traded stocks and ETFs this week
- (7:29): economic news items to look out for next week.
Overnight, the S&P500 advanced at the same magnitude as it slipped the day before. Industrials led among large cap segments, gaining momentum while at the other end of the leaderboard, staples declined the most. All US equity benchmarks closed in the green, with the Dow Jones also gaining more than 140 points or 0.3% and the tech-heavy Nasdaq up 0.2%. US investors weighed the latest quarterly earnings results from Nvidia. In extended trading, Nvidia’s share price fell almost 3%, despite its results beating expectations, which has seen the S&P futures move lower as the company makes up approximately 8% of the S&P500. And as we near the end of the month, the S&P 500 and the Nasdaq are each up more than 2%, while Dow is up more than 3% this month.
European markets closed mixed overnight. The German DAX down 0.44% and the FTSE100 down 0.11%. While France’s CAC was up 0.44% and the STOXX600 closed just 0.1% higher.
Locally yesterday, the ASX200 advanced 0.28% with materials and healthcare stocks in the lead, while consumer staples and technology declined the most.
What to watch today:
- Following the rally on Wall Street overnight, the SPI futures are suggesting that our local market will open only slightly higher this morning, with a 0.03% gain.
- And while we’re nearing the end of reporting season, a long list of companies are due to release their earnings results today. The most watched will likely be Qantas today (ASX:QAN) with the major airline set the release its results this morning and gold a press conference at 9am. Wesfarmers (ASX:WES) will also be reporting today, the conglomerate that owns Bunnings, Officeworks, Kmart and others. And other share prices to watch will be Eagers Automotive (ASX:APE), Lynas Rare Earths (ASX:LYC), Mineral Resources (ASX:MIN), Nickel Industries (ASX:NIC), and Paladin Energy (ASX:PDN) just to name a few.
- And companies going ex-dividend today include Beach Energy (ASX:BPT), Deterra Royalties (ASX:DRR), REA Group (ASX:REA) and Woodside Energy (ASX:WDS). Remember this often sees share prices fall as investors take their profits.
-
In commodities,
- Crude oil has gained 0.78% to US$63.74 per barrel recovering from a more than 2% drop, after US government data pointed to stronger-than-expected inventory declines. Crude stockpiles fell by 2.39 million barrels to 418.3 million, more than markets had anticipated. So watch energy producers today.
- The price of gold is higher just 0.08% to US$3,396.35 an ounce, hovering at a two-week high amid concerns over the Fed’s independence as President Trump signalled a legal fight after seeking to remove Governor Lisa Cook over alleged misconduct.
- And iron ore is in the green higher at US$101.59, so watch iron ore miners today.
Trading ideas:
- Following the release of Woolworth’s (ASX:WOW) results yesterday, Bell Potter maintain their Hold rating on the supermarket giant but have lowered their price target to $29.80, as the company reported NPAT outlook changes, down 2% in FY26 and down 8% in FY27. At the current share price of $28.51, this implies 4.5% share price growth in a year.
- And Bell Potter maintains their buy rating on WiseTech Global (ASX:WTC), although FY25 revenue came in below Bell Potter’s expectations and missed their guidance range. They have lowered their price target by 6% to $127.50. At WTC’s current share price of $102.02, this implies 25% share price growth in a year.
As reporting season enters its final week, we’ve seen 174 companies release their results, with 19% beating expectations. With more companies downgraded than upgraded by brokers, the importance of meeting valuations and maintaining solid outlook remains clear for investors. Some of the key themes looking ahead towards FY26 include the housing crisis driving tailwinds in for property developers, strengthening balance sheets from asset sales, and the challenges for expansion strategies into the US.
In this week’s video, Grady covers:
- (0:53) Cedar Woods Properties (ASX:CWP): property market tailwinds and strong pipeline drove solid results
- (2:51) Coles Group (ASX:COL): reported slightly ahead of expectations in their supermarket division
- (4:15) Endeavour Group (ASX:EDV): fell over 1% on weakness in its retail segment and modest forecasts
- (5:27) Aussie Broadband (ASX:ABB): surged 20% on strong FY25 results and positive forecast
- (6:27) Reece Plumbing (ASX:RCE): fell 16% after reporting decline in sales and EBIT.
Wall Street closed higher on Tuesday as investors assessed Trump’s latest moves and await key earnings results out of Nvidia. The S&P500 rose 0.41%, the Dow Jones gained 0.3% and the Nasdaq ended the day up 0.44%.
In Europe overnight, markets closed lower as global investors assessed Trump’s latest moves in attempt to intervene with the running of the US Federal Reserve. The STOXX 600 lost 0.83%, Germany’s DAX fell 0.4%, the French CAC declined over 2% and, in the UK, the FTSE 100 ended the day down 0.7%.
Across the Asia region on Tuesday, markets mostly fell as investors in the region also weighed Trump’s latest moves both on the Fed and tariff fronts. Trump reportedly warned of ‘200% tariffs or something’ on China if it does not export rare-earth magnets to the U.S. China’s CSI index fell 0.4%, Hong Kong’s Hang Seng dropped 1.18%, Japan’s Nikkei declined 0.97% and South Korea’s Kospi index ended the day down 0.95%.
The Australian share market dropped 0.41% on Tuesday, following global weakness after Donald Trump threatened higher tariffs over digital services taxes and called for the removal of Fed governor Lisa Cook.
We are at the tail end of reporting season now with a few key themes emerging as we head into FY26 including cost management being the key to margin maintenance, the foundations are set for a stronger FY26 through headwinds easing and dividends signalling stability heading into the new financial year.
Yesterday, Coles Group (ASX:COL) reported a solid FY25 that beat expectations with strong outlook for FY26 which sent the share price of Australia’s major supermarket giant up over 8.5%.
Web Travel (ASX:WEB) tumbled over 7.5% on Tuesday after providing a trading update that signalled softer-than-expected results in the first half despite strong FX tailwinds experienced in the half.
And mining giant Fortescue (ASX:FMG) tumbled over 2% after FY25 results reflected the weaker iron ore market during the last financial year including NPAT falling over 40% and the company slashed its dividend to the lowest level in 7-years.
What to watch today:
- Gold is up 0.54% at US$3385/ounce and iron ore is down 0.07% at US$101.53/tonne.
- On the commodities front this morning, oil is trading 2.32% lower at US$63.30/barrel, gold is up 0.54% at US$3385/ounce and iron ore is down 0.07% at US$101.53/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.96 US cents, 95.72 Japanese Yen, 48.45 British Pence and 1 New Zealand dollar and 11 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.53%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Propel Funeral Partners (ASX:PFP) from $5.50 to $5.90 and maintain a buy rating on the full-service funeral provider following the release of the company’s FY25 results including revenue growth of 7.9% and average revenue per funeral rising 1.3%. The company has also had a very strong start to the new financial year which has driven the price target increase.
- And Trading Central has identified a bullish signal on Collins Food Group (ASX:CKF) following the formation of a pattern over a period of 46-days which is roughly the same amount of time the share price may rise from the close of $9.76 to the range of $12.10 to $12.60 according to standard principles of technical analysis.
Major averages closed in the red on Wall Street overnight to start their trading week. The Dow Jones declined 0.77%, the S&P500 fell 0.43% and the Nasdaq down 0.22%. US investors awaiting Nvidia’s earnings and the Federal Reserve’s preferred inflation gauge in the coming days.
European markets were mostly lower. The German DAX down 0.37%, France’s CAC declined further down 1.56%, after the country’s Prime Minister Francois Bayrou announced he will be seeking a confidence vote in parliament next month over the government’s budget plans. The FTSE100 however closed in the green up just 0.13%, while the STOXX600 was lower, down 0.44%.
Locally yesterday, the ASX200 edged slightly higher at the close, ending the session with a 0.06% gain, as materials and energy stocks lead the market higher.
What to watch today:
- Following US equities overnight, the Australian market is set to open lower, with the SPI futures suggesting at 0.21% drop at the open this morning.
- In economic news, the latest RBA meeting minutes will be released today, providing further insight into when the RBA slashed its cash rate by 25bps to 3.6% at its August meeting, matching market expectations and bringing borrowing costs to their lowest since April 2023.
- And as we near the end of reporting season, we still have a number of companies reporting their earnings results. Keep watch of the share price movements of Coles (ASX:COL), Fortescue (ASX:FMG), G8 Education (ASX:G8E) and Helloworld Travel (ASX:HLO), just to name a few.
- In commodities:
- Crude oil has advanced again, up 1.7% to US$64.74 per barrel the highest in nearly three weeks, extending a four-day rally as traders weighed geopolitical risks and monetary policy signals.
- Gold is 0.2% lower at US$3,365.02 an ounce following a more than 1% gain in the previous session, as the US dollar attempted to recover after a dovish shift by Fed Chair Jerome Powell.
- And iron ore is in the green at US$101.60 per tonne, rebounding from last week’s losses.
Trading Ideas:
- Bell Potter maintains a Buy rating on Accent Group (ASX:AX1) and have lowered their price target to $1.80. At the current share price of $1.49, this implies 20.8% share price growth in a year.
- And Trading Central have identified a bearish signal in Westpac (ASX:WBC) indicating that the stock price may fall from the close of $38.29.
Wall Street closed higher on Friday after Fed chair Jerome Powell signalled the U.S. central bank could be easing monetary policy as soon as next month, during his speech at the Jackson hole symposium for 2025. The Dow Jones rose to a record high at the closing bell on Friday with a gain of 1.9% while the Nasdaq and S&P500 gained 1.88% and 1.52% respectively on Friday. During Powell’s speech he said “the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance” which investors welcomed on Friday.
In Europe on Friday, markets closed higher as investors digested the U.S. EU trade deal and hold higher hopes of a rate cut out of the U.S. in September. The STOXX 600 rose 0.5%, Germany’s DAX gained 0.3%, the French CAC climbed 0.4% and, in the UK, the FTSE100 ended the day at another record high, up 0.13%.
Across the Asia region on Friday markets closed mostly higher led by China’s CSI index rallying over 2%, while Hong Kong’s Hang Seng gained 0.32%, Japan’s Nikkei closed flat as inflation in the region cooled to 3.1% in July, and South Korea’s KOSPI index ended the day up 0.86%.
Locally to end last week the ASX200 posted a 0.57% loss as healthcare and staples stocks weighed on the key index.
On the reporting season calendar on Friday, it was a mixed session as investors reacted sharply to key results. Zip Co (ASX:Z1P) soared almost 20% after posting FY25 results whereby cash EBITDA soared 147% to $170.3m, operating margin rose to 15.8%, TTV increased 30.3% to $13.1bn and total income climbed 23.5% on FY24 to $1.081bn. Net bad debts also fell from 1.7% of TTV in FY24 to 1.5% of TTV in FY25 and active customers rose 4.6% to 6.3 million. Zip also excited the market announcing it is considering dual listing on the Nasdaq to support the company’s significant US growth.
Accent Group (ASX:AX1) on the other hand dived over 15% on Friday after the footwear and clothing retail parent company reported sales growth of just 1.5% in FY25 to $1.5bn and net profit tumbled amid widespread promotional activity required to reduce inventory levels.
And Mexican fast food outlet Guzman y Gomez (ASX:GYG) tanked over 23% to a record low after FY25 results came in well below market expectations and investors grew increasingly concerned about the company’s FY26 outlook.
What to watch today:
- On the commodities front this morning oil is trading 0.4% higher at US$63.77/barrel, gold is up 0.95% at US$3371/ounce and iron ore is down 0.15% at US$101.42/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.95 U.S. cents, 95.38 Japanese yen, 48 British pence and 1 New Zealand dollar and 11 cents.
- Ahead of Monday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up a sharp 0.94%
Trading Ideas:
- Bell Potter has downgraded the rating on Monash IVF (ASX:MVF) from a buy to a hold and have reduced the 12-month price target on the company from $1.15 to 77cps following the release of the company’s latest update including 2H25 revenue declining over 6% HoH and ARS down over 12%. Market stimulated cycles fell 0.7bp to 21% due to a reduction of cycles by over 5% which is significantly more than the only slight decline in industry growth.
- And Trading Central has identified a bearish signal on PWR Holdings (ASX:PWH) following the formation of a pattern over a period of 44-days which is roughly the same amount of time the share price may fall from the close of $$7.75 to the range of $5.80 to $6.30 according to standard principles of technical analysis.
With 90 companies reporting so far, standout results came from Goodman Group’s (ASX:GMG) datacentre expansion, Bega Cheese’s (ASX:BGA) strong turnaround, and Northern Star’s (ASX:NST) record gold profits, while The a2 Milk Company (ASX:A2M) delivered steady growth. Investors are continuing to rewarding cost control, resilient dividends, and clear guidance, with FY26 shaping up to be stronger across most sectors.
In this week’s wrap, Grady covers:
- (0:16): an overview of reporting season so far at the end of week 3
- (0:40): Goodman Group’s results with profit doubling from datacentre expansion
- (2:06): a dive into Bega Cheese’s results driven by branded volume growth
- (3:40): why investors are cautious on the a2 Milk Company outlook
- (4:44): Northern Star’s record-breaking year and what’s ahead
- (6:32): key themes emerging to consider from this reporting season
- (7:17): how the local market performed over the last trading week
- (7:56): the most traded stocks and ETFs this week
- (8:28): economic news items to look out for next week.
US equity markets pulled back following the latest Federal Reserve FOMC minutes release. The minutes were as expected, with the Fed focused on inflation numbers rather than jobs data which is what the market and investors have been watching closely lately.
While the Dow closed 0.4% higher, the S&P500 closed a 4-day loosing streak, down 0.24%. And a tech sell off saw the Nasdaq was down 0.67% in the red. We also saw a meaningful drop in bond yields overnight.
European markets were mixed overnight, the STOXX600 gained 0.23%, German DAX down 0.6%, France’s CAC down just 0.08% while the FTSE100 advanced 1.08%.
European defence stocks extended losses as the market regained optimism for an Ukraine ceasefire.Locally yesterday, the ASX200 gained 0.25% with consumer discretionary, real estate and financials in the lead.
What to watch today:
- The Australian market is set for a positive start to the day. The SPI futures are suggesting a 0.26% rise at the open this morning.
-
Supporting the market today will be a lift in energy prices as we saw in the US overnight. Looking at commodities:
- Crude oil advanced 1.84% to US$62.94 per barrel, after a weekly report from the Energy Information Administration showed a 6 million-barrel decline in US crude inventories, providing modest support to prices.
- The price of gold gained 1% to trade at US$3,350.27 an ounce,after the FOMC minutes supported expectations of a September rate cut in the US and a softer US dollar, which boosted global demand.
- Iron ore is slightly higher at US$101.52 per tonne, following reports that China will curb steel production.
- Locally, investors will be watching earnings from Whitehaven Coal (ASX:WHC), Bega Cheese (SSX:BGA), Brambles (ASX:BXB), and Goodman Group (ASX:GMG).
- AU$1.00 is buying US$0.64.
Trading ideas:
- Bell Potter maintains a Buy rating on Regal Partners (ASX:RPL) and maintain a 12-month price target of $3.55. At the current share price of $3.01, this implies 17.9% share price growth in a year.
- And Trading Central have identified a bearish signal in NextGen Energy (ASX:NXG) indicating that the stock price may fall from the close of $10.08 to the range of $8.50 to $8.80 over 51 days, according to the standard principles of technical analysis.
This week’s reporting season results show just how much investor reactions hinge on outlook. Despite earnings misses from major names, markets rewarded stronger forward guidance while punishing weakness. Emerging themes include cost management pressures, regional slowdowns, and the value of diversified earnings heading into FY26.
In this weeks video, Grady covers:
- BHP Group (ASX:BHP): rose 0.68% despite a 26% drop in profit to US$10.2bn, with investors backing improved cost guidance and copper strength
- CSL (ASX:CSL): fell 17% despite solid profit and revenue results, after announcing major restructures including cutting 3000 jobs
- James Hardie Industries (ASX:JHX): slumped nearly 30% after Q1 net income plunged 60% to US$62.6m and sales fell 9% to US$900m
- Key takeaways from week three of reporting season across the market.
Wall Street closed Tuesday’s session mixed as a tech decline weighed on key market indices. The S&P500 fell 0.6%, the Nasdaq lost 1.5% and the Dow Jones ended the day up just 0.02%. Investors have been pulling out of Nvidia in recent days with shares in the mega cap ending Tuesday’s session down 3.5% as traders take a breath from the recent AI rally in favour of undervalued small to mid-cap stocks in the current market environment.
In Europe overnight markets closed higher as investors welcomed peace talks progress initiated by President Trump with Ukraine leader Volodymyr Zelenskyy and Russian leader Vladimir Putin. The STOXX600 rose 0.7%, Germany’s DAX added 0.45%, the French CAC gained 1.21% and, in the UK, the FTSE 100 ended the day up 0.34% to a fresh record high.
Across the Asia region on Tuesday markets closed lower as investors await the outcome of Trump’s talks with Russia and Ukraine. Japan’ Nikkei fell 0.38% a day after closing at a record high, while Hong Kong’s Hang Seng closed flat, China’s CSI index lost 0.38% and South Korea’s Kospi index ended the day down 0.81%.
Locally yesterday the ASX200 fell 0.7% as market heavyweight CSL (ASX:CSL) tumbled almost 17% in its worst day ever after announcing weaker results than expected and reporting it will be cutting up to 3000 jobs.
BHP (ASX:BHP) also had results out yesterday that were weak on China’s subdued demand but shares still rose on optimistic outlook.
Westpac consumer confidence data out yesterday shows Aussies are regaining confidence as we enter the rate cut part of the rate cycle. The reading for August showed a MoM increase to 5.7% in August from 0.6% in July, signalling the strongest level since 2022.
What to watch today:
- On the commodities front this morning oil is trading 1.32% lower at US$62.58/barrel, gold is down 0.5% at US$3316/ounce and iron ore is down 0.05% at US$101.57/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.59 US cents, 95.28 Japanese Yen, 46.45 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.2%.
Trading Ideas:
- Bell Potter has downgraded the rating on CSL (ASX:CSL) from a buy to a hold and have significantly lowered the 12-month price target on the healthcare giant from $305 to $240 following the release of FY25 results, unveiling CSL's key division Behring disappointed with just 1% revenue growth, while Seqirus and Vifor exceeded expectations. Despite this, the market reacted sharply, and Bell Potter’s analyst see a challenging near-term outlook due to earnings growth missing expectations, weak 2H25 Behring performance, delayed margin recovery (now expected by FY29), and uncertainty around FY27/28 forecasts for the demerged entity.
- And Trading Central has identified a bearish signal on EBR Systems (ASX:EBR) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may fall from the close of $1.28 to the range of $1.13 to $1.17 according to standard principles of technical analysis.
US equities closed flat as investors await the Federal Reserve’s Jackson Hole summit, a three-day annual international conference attended by central bank leaders, as well as the release of retail earnings. The Dow Jones closed 0.08% lower, the S&P500 was flat, just 0.01% in the red and the Nasdaq closed 0.03% in the green.
European markets were mixed amid discussions between Ukraine and the US. The STOXX60 gained 0.08%, the German DAX down 0.18%, France’s CAC down 0.5% and the FTSE100 up 0.21%.
Locally yesterday, the ASX200 advanced 0.23% with communication services and technology in the lead, while materials and energy declined the most.
What to watch today:
- The SPI futures are suggesting at the Australian market will decline 0.26% at the open this morning, following a flat session on Wall Street overnight.
- BHP Group (ASX:BHP) released it’s full year results this morning. The mining giant posted its smallest annual underlying profit in 5 years, as iron ore prices remained under pressure due to oversupply concerns and slowing China demand. They reported an underlying attributed profit of $10.16 billion for the year ending June 30, below expectations.
- Australian biopharmaceutical company CSL Limited (ASX:CSL) also released results this morning, reporting at 14% rise in annual earnings, driven by strong performance at its blood plasma business. The company also announced a $750 million buyback in fiscal year 2026.
- In economic data, Westpac’s consumer confidence data and consumer inflation expectations will be released today.
- Looking at commodities,
- Crude oil has rebounded 0.9% to US$63.36 per barrel, following the inconclusive US-Russia summit in Alaska on Friday. Markets are watching the potential impact of the talks on global oil supply, including possible changes to sanctions or progress toward reconciliation.
- The price of gold has steadied, trading at US$3,331.93 an ounce.
- And iron ore is in the green at US$101.62.
Trading Ideas:
- Bell Potter maintains a Speculative Buy rating on Comet Ridge (ASX:COI), an energy exploration and development company focused on coal and gas. Their valuation is $0.21 and at the current price of $0.14, this implies 56% share price growth in a year.
- And Trading Central have identified a bearish signal in Imdex (ASX:IMD) indicating that the stock price may fall from the close of $3.40 to the range of $2.75 to $2.85 over 20 days, according to the standard principles of technical analysis.
US equities closed the trading week on Friday mixed. The S&P500 posted its second weekly gain but closed 0.29% lower on Friday. The Dow gained just 0.08%, while the tech heavy Nasdaq declined 0.4% as investors took gains from what was a strong trading week.
European markets were in the red ahead of a meeting between President Donald Trump and President Vladimir Putin over the war in Ukraine, which saw the STOXX600 close flat.
Locally on Friday, the market rallied, closing with a gain of 0.73%. Energy and materials were in the lead along with 9 of the 11 industry sectors in the green. Technology and consumer staples were the worst performers, posting small declines at Friday’s close.
What to watch today:
- Following mixed trading on Wall Street, the Australian market is set to open lower this morning. The SPI futures are suggesting a 0.6% fall at the open.
- In commodities
- Crude oil has fallen almost 1.3% to US$63.14 per barrel, as traders awaited the outcome of talks between US President Donald Trump and Russian President Vladimir Putin, with hopes for a possible ceasefire in Ukraine affecting market sentiment.
- The gold price is flat at US$3,335.60 an ounce, as hotter-than-expected US data tempered hopes for a large Fed rate cut.
- And iron ore is down 0.24% at US$101.59 per barrel so keep watch of iron ore mining stocks today.
- And as we reach mid reporting season, a long list of companies a reporting their earnings result today. These include the A2 Milk Company (ASX:A2M), Ampol (ASX:ALD), BlueScope Steel (ASX:BSL), Lendlease Group (ASX:LLC), NAB (ASX:NAB), New Hope Corporation (ASX:NHC), oOh! Media (ASX:OML) and Seek (ASX:SEK).
- In economic data today, at 11:30am AEST consumer inflation expectations for August will be released.
Trading Ideas:
- Bell Potter maintains a Speculative Buy recommendation on Liontown Resources (ASX:LTR) and have reduced their 12-month valuation from $1.05 to 1.15. They say LTR’s 100% owned Kathleen Valley lithium project remains highly strategic in terms of scale, long project life and location in a tier-one mining jurisdiction. At LTR’s current share price or $0.85, this implies 36% share price growth in a year.
- And Trading Central have identified a bullish signal in Adairs (ASX:ADH) indicating that the stock price may rise from the close of $2.24 to the range of $2.34 - $2.38 over 34 days, according to the standard principles of technical analysis.
Wall Street saw a positive trading session with all three major US benchmarks closing in the green. The Dow gained 400 points for a second session, up 1.04%. The S&P500 reached another record high and closed 0.32% higher, while the tech- heavy Nasdaq gained 0.14%.
European markets also extended gains after Wall Street’s record highs, expectations for lower U.S. Federal Reserve rates continue driving the major indexes to all-time highs. The STOXX600 advanced 0.54%.
Locally yesterday the Australian market closed down 0.6%, dragged down by utilities and financials, while materials and healthcare were in the lead. Today’s session however, is looking more positive.
What to watch today:
The SPI futures are suggesting our local market will rise 0.35% at the open this morning.
Also on watch today are the companies reporting their earnings results. So far this morning at the time of recording, the highlights are:
- Westpac (ASX:WBC) posted $1.9 billion third quarter profit,
- Suncorp (ASX:SUN) jumped 52% to $1.8 billion,
- And Telstra (ASX:TLS) profit grew 31% to $2.34 billion, and the company declared a 19cps payout.
And keep watch of the share price movements for other companies reporting, including the Australian Stock Exchange (ASX:ASX), Origin Energy (ASX:ORG) and Pro Medicus (ASX:PME). In commodities,
- crude oil has called 0.64% to US$62.74 per barrel, the lowest in over two months, after the International Energy Agency forecast a growing oil surplus this year and next.
- The price of gold is up 0.3% to US$3,357.68 an ounce as investors weighed the federal reserve rate outlook following the latest CPI data announcement. July’s headline inflation came in at 2.7%, below the 2.8% forecast, while core inflation rose to 3.1% from 2.9%.
- Seaborne iron ore is down 0.37% to US$102.03, while futures hold near two week highs, on expectations of further steel production cuts in China.
And in economic data today, the unemployment rate for July will be out at 11:30am AEST.
Trading Ideas:
- Bell Potter maintains a Buy rating on Life360 (ASX:360) after the company reported 2Q2025 revenue of US$115.4 million, 6% ahead of Bell Potter’s forecast of US$109.1 million and adjusted EBITDA of US$20.3 million, 59% above their forecast of US$12.8 million. Bell Potter have increased their 12 month price target by 27% to $47.50, and at the current share price of $40.77, this implies 16.5% share price growth in a year.
- And Trading Central have identified a bearish signal in Pro Medicus (ASX:PME) indicating that the stock price may fall from the range of $297.15, to the range of $271 - $276 over 28 days, according to the standard principles of technical analysis.
In the U.S. overnight the S&P and Nasdaq reset their respective record highs while the Dow Jones also closed higher as investors welcomed the latest CPI reading which came in tamer than expected. The S&P 500 rose 1.13%, the Nasdaq added 1.4% and the Dow Jones ended the day up 1.1%. The US CPI reading rose 2.7% on an annualised basis in July which fell short of economists’ estimates of a 2.8% rise, while core CPI rose 3.1% which slightly beat expectations. The data indicates Trump’s tariffs are having a lower impact than expected on inflation and supports the case for the Fed to consider a rate cut in the near future.
In Europe overnight, markets closed mostly higher in the region after US inflation accelerated less than expected. The STOXX 600 rose 0.24% on Tuesday while the French CAC added 0.8% and the UK’s FTSE100 climbed 0.22%, but Germany’s DAX fell 0.13%.
Across the Asia region on Tuesday, markets in the region closed mostly higher after a tariff truce was called between the US and China. Japan’s Nikkei hit a record high, ending the day up 2.15%, while Hong Kong’s Hang Seng added 0.25% and China’s CSI index ended the day up 0.52%.
The local market started the new trading week higher with a 0.41% rise on Tuesday, following the RBA’s 0.25% or 25-bps rate cut yesterday and on the back of key catalysts in the earnings and materials spaces over the last few sessions.
The RBA’s rate cut was expected and the board said ‘with underlying inflation continuing to decline back towards the midpoint of the 2–3 per cent range and labour market conditions easing slightly, as expected, the Board judged that a further easing of monetary policy was appropriate’ but there was no discussion of a larger rate cut as Australia’s central bank takes a more conservative approach to the rate journey amid extensive macro factors influencing our inflation journey.
On the reporting season calendar yesterday we saw shares in geolocation tracking services and hardware company Life360 (ASX:360) soar 9% after the company released Q2 and H1 results that topped expectations including a 36% jump in both revenue and annualised monthly revenue.
While at the other end of the market Seven Group (ASX:SGH) tumbled 9% following the release of FY25 results including revenue up just 1% while low to mid-single-digit EBIT growth is expected as guided to by management which will fall below that of the 8% delivered in FY25.
What to watch today:
- On the commodities front this morning oil is trading 1.19% lower at US$63.20/barrel, gold is up 0.2% at US$3348/ounce and iron ore is up 0.73% at US$101.96/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.31 US cents, 96.47 Japanese Yen, 48.20 British Pence and 1 New Zealand dollar and 10 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day up 0.16%.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on SGH (ASX:SGH) from $54 to $51 and maintain a hold rating on the diversified company following the release of the company’s results as the analyst sees the company is facing short-term cyclical headwinds in construction markets, offsetting healthy operating conditions in mining markets.
- And Trading Central has identified a bearish signal on Auckland International Airport (ASX:AIA) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may fall from the close of $6.94 to the range of $6.59-$6.65 according to standard principles of technical analysis.
US equities closed in the red overnight ahead of the July inflation report. The Dow Jones closed 0.45% lower, the S&P500 declined 0.25% and the Nasdaq declined 0.3%.
European markets were mostly lower. The German DAX dropped 0.34%, France’s CAC down 0.57%, while the FT100 gained 0.37% and the STOXX600 saw little change, down just 0.06%.
Locally yesterday, the ASX advanced 0.43% with materials and consumer staples in the lead, while consumer discretionary stocks and tech declined the most.
What to watch today:
- The SPI futures are suggesting the Australian market will drop 0.15% at the open this morning, following Wall Street overnight.
- In economic data today, the RBA will announce its next interest rate decision. Its highly expected the Central Bank will announce a 25 basis point cut.
- Companies reporting their earnings results today include Life360 (ASX:360), Computershare (ASX:CPU), Coronado Global Resources (ASX:CRN) and SGH (ASX:SGH) just to name a few.
- In commodities,
- Crude oil is up 0.45% to US$64.16 per barrel after last week’s heavy drop, following President Donald Trump’s efforts to end the Ukraine war, easing fears of disrupted Russian supply.
- The safe haven gold dropped 1.54% currently trading at US$3,346.93 an ounce after Trump announced that the metal would not face tariffs, easing concerns of a share increase in gold import costs.
- And iron ore is in the green up 0.73% at US$101.96, so keep watch of iron ore miners today.
Trading Ideas:
- Bell Potter maintain a Buy rating on JB Hi-Fi (ASX:JBH) and has reduced their price target to $119. At the current share price of $107.83 this implies 10.4% share price growth in a year.
- And Trading Central have identified a bearish signal in Domino’s Pizza (ASX:DMP) indicating that the stock price may fall from the close of $18.68 to the range of $13.70 to $14.60 over 28 days, according to the standard principles of technical analysis.
Wall Street rallied on Friday following a strong week of earnings results indicating company and economic resilience in the wake of President Trump’s tariffs. The Nasdaq closed at a record high, ending the day up 0.98% to 21,450 points, while the S&P 500 added 0.78% and the Dow Jones ended the day up 0.47%. For the week the major averages each posted notable gains with the S&P 500 rising 2.4%, the Dow Jones climbing 1.4% and the Nasdaq posted a strong 3.9%. Apple shares boosted markets on Friday with a 13% surge after announcing plans to spend US$600bn over 4-years to appease President Trump’s push to manufacture in the U.S.
In Europe on Friday markets closed higher on Friday on reports the U.S. and Russia plan to end Russia’s war with Ukraine. The STOXX 600 rose 0.3%, Germany’s DAX and the UK’s FTSE100 each closed flat, and the French CAC ended the day up 0.4%.
Across the Asia region on Friday, markets closed mostly lower with Hong Kong’s Hang Seng falling 0.89%, while China’s CSI index lost 0.24%, and South Korea’s Kospi index fell 0.55%, while Japan’s Nikkei ended the day up 1.85%.
Locally on Friday the ASX 200 posted a 0.27% loss as a sharp selloff in financials and healthcare stocks weighed on the key index. For the week though the key index managed to post a 1.7% gain ahead of the expected rate cut announcement out of the RBA this week. Block (ASX:XYZ) soared 7.5% on Friday after posting increased spending activity on After-pay which lifted profit and growth over Q2, while Nick Scali (ASX:NCK) shares also soared 8.6% after its ANZ business saw a 7.3% rise in H2 sales despite a depleted consumer spend environment.
What to watch today:
- On the commodities front this morning, oil is trading 0.83% lower at US$63.35/barrel, gold is up 0.06% at US$3397/ounce and iron ore is up 0.01% at US$101.22/tonne.
- The Aussie dollar has slightly strengthened against the greenback to buy 65.25 US cents, 96.33 Japanese yen, 48.52 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the market will open the day up 0.06%.
Trading ideas:
- Bell Potter has downgraded the rating on Monadelphous Group (ASX:MND) from a hold to a sell following the release of the company’s FY25 result preview including the anticipation of weaker 2H profitability, and current overvaluation of the stock trading on a 23.8x FY26 PE. MND trades at a 55% premium to Industrial Services peers and is forecast to deliver the lowest FY26 earnings growth in the peer group.
- And Trading Central has identified a bearish signal on Kelly Partners Group (ASX:KPG) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may fall from the close of $10.34 to the range of $9.65 to $9.85 according to standard principles of technical analysis.
In the US overnight, all three major benchmarks rallied after President Donald Trump announced a steep new tariff on imports of semiconductors and chips. That is, a 100% tariff on imported chips, with the exception for companies that are building in the US. The Dow Jones gained 0.18%, the S&P500 gained 0.73% and the Nasdaq rallied 1.21% at the close.
In European, Swiss stocks declined after their President and economic minister met with US government officials, with the aim of lowering the 39% tariffs imposed by the US.
While the STOXX600 closed 0.06% lower, the German DAX was just 0.33%, France’s CAC up 0.24% and the FTSE100 up 0.24%.
Locally yesterday, the Australian market gained 0.84%, with 10 of the 11 industry sectors in the green. The market was led by energy and materials stocks.
For today’s trading session, the SPI futures are suggesting a 0.31% drop at the open this morning, despite markets rallying overnight.
What to watch today:
- Balance of trade data for June will be released at 12:30pm.
- And keep watch of the share price movements of companies reporting their earnings results today, including AMP Group (ASX:AMP), AVITA Medical (ASX:AVH), Bannerman Energy (ASX:BMN), Light and Wonder (ASX:LNW) and QBE Insurance Group (ASX:QBE).
- In commodities,
- Crude oil has dropped 1.32%, trading at US$64.30 per barrel, marking a fifth straight decline and hitting a fresh six-week low.
- Gold is slightly lower down 0.3% at US$3,371.13
- And iron ore is lower 0.43% at US$100.92 per tonne.
Trading Ideas:
- Bell Potter maintains a Buy rating on Perpetual (ASX:PPT) and have increased their price target from $22.80 and $23.00. At the current share price of $21.16, this implies 8.7% share price growth in a year.
- And Trading Central have identified a bullish signal in Ramelius Resources (ASX:RMS), indicating that the stock price may rise form the close of $2.79 to the range of $3.45 to $3.65 over 46 days, according to the standard principles of technical analysis.
In the US today so far, Wall St closed lower as investors digested weak economic data against the latest tariff threats out of President Trump. ISM services index data flatlined for July adding to stagflation concerns in the US while stocks also came under pressure after Trump told CNBC that tariffs on chips and pharmaceuticals are coming soon. The S&P 500 ended the day down 0.5%, the Nasdaq dropped 0.65% and the Dow Jones ended the session down 0.14%.
In Europe overnight, markets in the region closed mostly higher despite President Trump saying he will unveil new tariffs in the near future. The STOXX 600 rose 0.1%, Germany’s DAX added 0.4%, the French CAC fell 0.1% and, in the UK, the FTSE 100 ended the day up 0.1%.
Across the Asia region on Tuesday markets closed higher led by South Korea’s Kospi index adding 1.6%, while Hong Kong’s Hang Seng climbed 0.92%, China’s CSI index added 0.4% and Japan’s Nikkei ended the day up 0.64%.
The local market started the new trading week in the green with a 1.23% surge on Tuesday as all sectors ended the day in positive territory following strength on Wall St on Monday night. Discretionary and financials were the best performing sectors with gains of 1.81% and 1.49% respectively, while staples managed the lowest gain with 0.34%.
Australian consumer confidence rose to 90.6 points, the highest since May 2022, following easing inflation data and expectations of an interest rate cut by the Reserve Bank of Australia. The ANZ-Roy Morgan index saw significant improvements in both current and future financial conditions, with a 0.25% rate reduction anticipated this month.
Telix Pharmaceuticals (ASX:TLX) plunged over 8% after it flagged higher operating expenses in the first half of the fiscal year to be around 36% of revenue for 1H25.
Austal (ASX:ASB) added over 7.5% as it finalised its agreement with the federal government to become the country’s leading defence shipbuilder. The company also impressed investors with a guidance update for FY25 with the new guidance expectation for EBIT of no less than $100m for the 12-months, higher than the previous guidance of no less than $80m.
And Electro Optic Systems (ASX:EOS) rocketed 43% on Tuesday after announcing it has secured an order for a drone defence capability based on a new type of high-power laser, to the value of $125m (71.4million euros) from a European NATO Member State. The order is a world first export order for a 100-kilowatt class laser defence system.
What to watch today:
- On the commodities front this morning, oil is trading 1.66% lower at US$65.20/barrel, gold is up 0.16% at US$3379/ounce and iron ore is up 1.21% at US$100.77/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.72 US cents, 95.56 Japanese Yen, 48.62 British Pence and 1 New Zealand dollar and 10 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the new trading day up 0.13.
Trading ideas:
- Bell Potter has significantly increased the 12-month price target on Electro Optic Systems (ASX:EOS) from $3.75 to $5.00 and maintain a buy rating on the defence manufacturer after the company secured its latest order valued at 71.4m euro. The new laser counter-drone capability was developed by EOS to address the urgent market need and emerging strategic requirement to defend against drone swarm attacks at an economical cost.
- And Trading Central has identified a bullish signal on AGL Energy (ASX:AGL) following the formation of a pattern over a period of 34-days which is roughly the same amount of time the share price may rise from the close of $10.00 to the range of $10.45 to $10.55 according to standard principles of technical analysis.
Wall Street closed lower across the major averages on Friday as investors assessed signals of a weakening economy against Trump’s modified tariffs imposed from August 1. The Dow Jones lost 1.23% on Friday, the S&P 500 fell 1.6% and the tech-heavy Nasdaq ended the day down 2.24%.
The all-important July jobs report came in weaker-than-expected with an expansion of just 73,000 in nonfarm payrolls for the month, well short of the 100,000 economists were expecting signalling economic weakness at a time Trump’s latest tariffs were imposed.
In Europe on Friday markets closed lower after Trump’s latest slew of tariffs came into effect despite the UK and EU having already negotiated trade deals. The STOXX 600 fell 2.7% on Friday while Germany’s DAX lost 2.66%, the French CAC ended the day down 2.91%, and, in the UK, the FTSE100 closed Friday’s session down 0.7%.
Across the Asia region on Friday markets also closed lower after Trump modified his tariffs on the region. Japan’s Nikkei lost 0.66%, Hong Kong’s Hang Seng fell 1.07%, China’s CSI index declined 0.51% and South Korea’s Kospi index ended the day down a sharp 3.88%.
Locally on Friday the ASX200 posted a 0.9% loss to end a solid trading week as investor sentiment was dented by Trump’s latest tariff moves on copper and key trade partners, and investors reassessed positions to start the new month ahead of key earnings results updates and as the market hovers around all-time highs.
Star Entertainment Group (ASX:SGR) tanked over 13% on Friday after the embattled casino operator’s sale of its Queen’s Wharf precinct to its Hong-Kong based JV partner collapsed.
Sleep apnoea treatment leader ResMed (ASX:RMD) rallied over 1% on Friday after posting another quarter of strong results including double digit revenue growth and higher-than-expected margin expansion in the latest quarter.
What to watch today:
- The Aussie dollar has strengthened against the greenback to buy 64.72 US cents, 95.29 Japanese yen, 48.70 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down 0.4%.
Trading ideas:
- Bell Potter has initiated coverage of Sigma Healthcare (ASX:SIG) with a sell rating and a 12-month price target of $2.00 as the analyst believes the company is a great business but is overpriced. 2H25 earnings are also expected to be weaker (relative to 1H25) as is the normal seasonal trend. We expect a convergence on consensus earnings for FY26 following FY25 reporting in August.
- And Trading Central has identified a bearish signal on Mader Group (ASX:MAD) following the formation of a pattern over a period of 29-days which is roughly the same amount of time the share price may fall from the close of $7.15 to the range of $5.70 to $6.00 according to standard principles of technical analysis.
Reporting season is here, and Rio Tinto’s (ASX:RIO) mixed results have put materials stocks in focus. While iron ore remains under pressure from weak prices, growing momentum in copper and lithium point to an upside in green energy linked commodities, and shape a more positive outlook for the sector generally in FY26.
In this week’s wrap, Grady covers:
- (0:38): Rio Tinto’s results and what they mean
- (2:08): results from the broader iron ore sector
- (3:21): Pilbara’s results and the outlook for lithium
- (3:39): how the market performed this week so far
- (5:02): the most traded stocks and ETFs this week
- (6:20): economic news items to look out for.
Yesterday, the S&P 500 snapped its six-day winning streak to close lower. Real Estate was the best-performing segment, up 1.7%, supported by lower bond yields with the 10-year Treasury yield down 9 basis points as the Job Openings and Labor Turnover Survey indicated a slowing US labour market.
Federal Reserve chair Jerome Powell signalled that the Fed won’t be cutting rates yet, as the central bank assesses the impact of the higher tariffs on inflation.US equities closed mixed overnight. The S&P500 gave up earlier gains to close 0.12% in the red. The Dow Jones also closed in the red, losing 170 points or 0.38%, while the Nasdaq gained 0.15%. This morning, S&P500 futures rose after quarterly updates from Microsoft and Meta beat expectations.
European markets were mostly in the green. Germany’s DAX up 0.19%, France’s CAC up 0.06%. The FTSE100 was flat, just 0.01% in the green, while the STOXX600 closed just 0.02% in the red.
What to watch today:
- The Australian market is set to open lower, with the SPI futures suggesting a 0.24% drop at the open this morning.
- Rio Tinto (ASX:RIO) shares will be on watch this morning as the mining giant just released its half year results. With weakness in iron ore, RIO reported a slight increase in consolidated sales revenue to US$26.87 billion, however also reported a 16% drop in underlying earnings to US$4.8 billion. This led to the miner cutting its interim dividend by 16% to US$1.48 per share. Its NYSE listed shares tumbled 4.5% overnight, so keep watch of RIO today.
-
Looking at commodities price movements overnight,
- Crude oil has advanced 1.5%, current trading at US$70.27 per barrel, holding at a five-week high, supported by supply concerns after President Donald Trump pressured Russia with a shortened timeline to end the conflict in Ukraine.
- The price of gold has fallen 1.4% to US$3,278.74 an ounce, hitting one-month low, after the Federal Reserve kept interest rates steady at 4.25% - 4.5%.
- Iron ore is steady at US$99.07 per tonne.
Trading ideas:
- Bell Potter maintain a Buy rating on Pilbara Minerals (ASX:PLS) with a $2.00 price target. The current share price is $1.73, implying 16% share price growth in a year.
- And Trading Central have identified a bearish signal in Appen (ASX:APX) indicating that the stock price may fall from the close of $0.95 to the range of $0.82 - $0.86, over 23 days, according to the standard principles of technical analysis.
Wall St closed lower on Tuesday as Wall St awaits for the Federal Reserve interest date decision. The Dow Jones fell 0.46%, the S&P 500 dropped 0.3% and the tech heavy Nasdaq closed 0.38% lower.
Over in Europe, the STOXX 600 closed 0.29% higher, Germany’s DAX rose by just over 1%, the French CAC gained 0.72% and over in the UK, the FTSE 100 ended Tuesdays trading session 0.6% in the green.
Locally yesterday, the ASX200 closed Tuesday’s session out 0.08% higher with most major sectors closing positive. Gains were led by the energy and industrial sectors which jumped by 0.65% and 0.33% respectively. This was offset by the real estate sector which fell by 0.44% by market close.
What to watch today:
- The Australian share market is set to open slightly lower with the SPI futures predicting a fall of 0.08% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 4.03% higher at 69 US dollars and 40 cents a barrel.
- Gold is trading 0.34% higher at 3326 US dollars an ounce
- And iron ore is trading 0.31% higher at 98 US dollars and 98 cents a tonne.
Trading Idea:
- Bell Potter has increased the 12-month price target on Liontown Resources (ASX:LTR) from 90cps to $1.05 and maintain a speculative buy rating on the lithium producer following the release of the company’s Q4 trading update including production and sales of lithium exceeding Bell Potter expectations and the company finished the quarter with cash of $156m.
Wall Street started the new trading week almost flat as traders looked past the EU-US trade deal that was announced and focused more on the upcoming Fed interest rate decision. The S&P500 rose just 0.02% to another fresh record high while the Dow Jones fell 0.14% and the Nasdaq ended the day up 0.33% also setting a fresh record. A trade deal has been reached between the US and EU which will see 15% tariffs on all exports from the EU bound for the US.
In Europe overnight markets closed mostly lower as the trade deal between the US and EU failed to raise investor confidence levels. The STOXX 600 fell 0.23%, Germany’s DAX fell 1.02%, the French CAC declined 0.43% and, over in the UK, the FTSE 100 ended the day down 0.43%.
Locally on Monday the ASX 200 see-sawed throughout the first trading session of the new week before closing the day up 0.36% as investors took confidence from the S&P500 record run of late and ahead of key earnings results coming out over the coming weeks.
Uranium producer Boss Energy (ASX:BOE) tanked over 40% after the company released a fourth quarter performance update for FY25. At first glance the results looked very strong with an 18% increase in drummed uranium from the prior quarter, FY25 production totalling 872,607 pounds and second half FY25 C1 cost from drummed uranium of $36/pound. Looking deeper into the company’s announcements out yesterday though, investors likely fled the stock after the FY26 Honeymoon mine guidance was issued including increased cash costs, and potential challenges now identified that may arise.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures predicting a fall of 0.7% at market open this morning
- On the commodities front this morning, oil is trading 2.68% higher at 66 US dollars and 91 cents a barrel, gold is down 0.6% at 3317 US dollars an ounce and iron ore is down 0.03% at 98 US dollars and 55 cents a tonne.
Trading ideas:
- Bell Potter has slightly reduced the 12-month price target on Step One Clothing (ASX:STP) from $1.30 to $1.25 and maintains a buy rating on the online retailer of underwear and innerwear. The analyst has reduced the price target by 4% due to Bell Potter’s earnings revision outlook factoring in a delayed recovery in the consumer spend environment.
Wall Street closed higher with the S&P500 posting its 5th straight record close as investors digested a strong start to earnings season in the US and trade developments in the form of a landmark trade agreement with Japan. The S&P500 rose 0.4% on Friday to post its 14th record close of the year, the Nasdaq added 0.24% and the Dow Jones ended the day up 0.47%. Both Alphabet and Verizon rallied last week on the back of better-than-expected earnings results with rallies of 4% and 5% respectively over the last trading week.
In Europe on Friday markets closed mostly lower following Trump’s remarks saying there is a ’50-50’ chance of a deal being done with the EU before his self-imposed August 1 deadline. The STOXX 600 fell 0.2%, Germany’s DAX lost 0.3%, the French CAC added 0.2% and, in the UK, the FTSE100 ended the day down 0.2%.
Across the APAC region on Friday markets closed mostly lower as investors assessed recent trade developments. Japan’s Nikkei lost 0.88%, Hong Kong’s Hang Seng fell 1.09%, India’s Nifty 50 declined 0.9% and South Korea’s Kospi Index bucked the trend to close 0.18% higher.
Locally on Friday the ASX200 posted a 0.5% loss on Friday as a sharp sell-off in materials, financials and healthcare stocks offset strength among energy and tech stocks. For the week, Australia’s key index lost 1.03%.
The banks extended their sell-off on Friday as investors continued profit taking from the sector that ran the hottest over the last financial year. CBA (ASX:CBA) fell over 5% over the last trading week while NAB (ASX:NAB)declined over 4%, Westpac (ASX:WBC) fell over 3% and ANZ (ASX:ANZ) lost 1%.
Regal Partners (ASX:RPL) shares jumped over 9% on Friday after the specialist alternative investment manager reported a 7% rise in funds under management for the June quarter with net inflows at around $600m for the quarter.
What to watch today:
- On the commodities front this morning oil is trading 1.45% lower at US$65.07/barrel, gold is down 0.93% at US$3336.98/ounce and iron ore is down 0.03% at US$98.55/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.75 US cents, 97.09 Japanese Yen, 48.79 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down just 0.06%.
Trading Ideas:
- Bell Potter has downgraded the rating on Whitehaven Coal (ASX:WHC) from a buy to a hold and have reduced the 12-month price target on the coal miner from $7.10 to $6.90 following the release of Q4 results out of the company. FY25 guidance was met, Group production and sales met the upper half of the guidance range and unaudited unit costs, and capex were below guidance. The company increased debt though following the first payment for the BMA acquisition and Narrabri undertook an 8-week longwall maintenance period during FY25 which is expected to be overcome in FY26. The move to a hold rating is due to recent share price appreciation.
- And Trading Central has identified a bearish signal on Gentrack (ASX:GTK) following the formation of a pattern over a period of 67-days which is roughly the same amount of time the share price may fall from the close of $9.72 to the range of $7.90 to $8.30 according to standard principles of technical analysis.
As July wraps up, all eyes turn to August reporting season, where investors are bracing for modest earnings growth and heightened volatility. Banks, staples and tech stocks face valuation pressure, while retailers and miners contend with weaker demand and rising costs. Expect capital management, cost control and forward guidance to separate the standouts from the strugglers.
In this week’s wrap, Grady covers:
- (0:11): the pivot away from the financial sector
- (1:38): a dive into the technology, retail, healthcare and materials sectors
- (3:21): key risks to watch out for this reporting season
- (4:12): how the market performed this week so far
- (4:47): the most traded stocks and ETFs this week
- (5:14): economic news items to look out for.
To start, we wanted to let you know that for a limited time only, you can earn 4.75% p.a. on new ‘ready to invest’ Bell Direct accounts. Visit the Bell Direct website to find out more. Well, as investors await the impending tariff deadline, the US has finalised an agreement with Japan, including reciprocal tariffs of 15% on the nations exports to the US. All three US benchmarks rallied, with the Dow Jones jumping 500 points or 1.14%, the S&P500 up 0.78% and the Nasdaq up 0.61%. US - EU trade deal investor optimism also saw US equities advance.
The German DAX up 0.83%, France’s CAC up 1.37%, the FTSE100 up 0.42% and the STOXX600 up 1.08%. Our local market also advanced yesterday with 10 of the 11 industry sectors closing in the green. Materials, energy and financials were in the lead, bringing the ASX200 0.69% higher at the close.
What to watch today:
- Following global markets rallying overnight, the Aussie market is set to rise 0.26% at the open this morning, according to the SPI futures.
- In commodities,
- Crude oil is up 0.2% trading at US$65.43 per barrel, marking the fourth straight day of losses.
- The safe haven gold price saw a 1.3% decline overnight, now sitting at US$3,386.86 an ounce, pulling back slightly from a five-week high, pressured by a wave of trade deals that dampened the metal's safe-haven appeal.
- And iron ore is trading 0.3% higher at US$98.11 per barrel.
- In economic news, this morning we’ll receive the S&P Global Manufacturing and Services flash PMI, a forward looking estimate of the final producers managers index out next week.
Trading ideas:
- Bell Potter maintain a Buy rating on Paladin Energy (ASX:PDN) and have downgraded their 12- month price target from $9.20 to $8.70 as FY26 production guidance lower than what was modelled for by Bell Potter, based off a ramp to follow processing capacity in mid FY26 and as higher costs see an EBITA decline. At the current share price of $7.25, the target price implies 20% share price growth in a year.
- Trading Central have identified a bullish signal in NRW Holdings (ASX:NHW) indicating that the stock price may rise from the close of $3.22 to the range of $4.05 - $4.20 over 49 days, according to the standard principles of technical analysis.
Wall Street closed mostly higher on Tuesday with the S&P500 resetting its record high as the major average rose 0.06%, while the Dow Jones climbed 0.4%, and the Nasdaq fell 0.39%. Investors continued shifting focus from trade war developments to robust earnings results.
In Europe overnight markets closed lower for a third day as investors digested earnings results from some of the largest companies in the region. The STOXX 600 fell 0.5%, Germany’s DAX lost 1.2%, the French CAC declined 0.7% and, in the UK, the FTSE100 ended the day flat.
Across the Asia region on Tuesday, markets closed mixed again with Japan’s Nikkei falling 0.11%, while China’s CSI index added 0.82%, Hong Kong’s Hang Seng gained 0.54% and South Korea’s Kospi index ended the day down 1.27%. Shares in SoftBank group surged 6% after reports emerged that the Japanese investment firm is set to build a small data centre by the end of the year.
Locally on Tuesday, the ASX 200 started the day with a strong rally before easing in afternoon trade to end the session up just 0.1% after the latest RBA meeting minutes were released outlining the cautious approach to rate cuts taken by the RBA as they want to see the quarterly inflation reading before making any moves, especially amid the volatility of tariffs.
Ramelius Resources (ASX:RMS) soared almost 8% on Tuesday in its biggest one-day rise in 15-weeks on the rallying gold spot price and after the Supreme Court of WA approved the company’s $2.4bn acquisition of Spartan Resources.
Investors continued selling out of the big banks again yesterday amid stretched valuations. CBA (ASX:CBA) fell 3.1%, while NAB (ASX:NAB), Westpac (ASX:WBC) and ANZ (ASX:ANZ) lost 2.7%, 1.3% and 0.8% respectively.
Most traded securities:
- The most traded investments by Bell Direct clients yesterday were led by
- BHP (ASX:BHP)
- Vanguard Australian Shares Index ETF (ASX:VAS)
- CSL (ASX:CSL)
What to watch today:
- On the commodities front this morning, oil is trading 0.78% lower at US$65.44/barrel, gold is up 0.87% at US$3425/ounce, and iron ore is up 0.64% at US$97.84/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.57 U.S. cents, 96.13 Japanese yen, 48.29 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.45% tracking wall street’s majority rally overnight.
Trading ideas:
- Bell Potter has increased the 12-month price target on Frontier Digital Ventures (ASX:FDV) to $0.63 from $0.54 and maintain a speculative buy rating on the online marketplace focused investment company. The analyst sees there are multiple potential catalysts for a potential share price re-rating including improving macro backdrop for emerging market investment, positive growth forecasts for FDV, and potential portfolio monetisation/price discovery events to unlock shareholder value.
- And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU) following the formation of a pattern over the period of 6-days which is roughly the same amount of time the share price may rise from the close of $3.67 to the range of $3.89 to $3.95 according to standard principles of technical analysis.
Wall Street closed with records across 2 of the 3 major averages on Monday as optimism around earnings overshadowed investor fears of the latest tariff developments. The S&P500 rose 0.14% to close over 6300 for the first time, the Nasdaq added 0.38% to also post a record close and the Dow jones ended the day down just 0.04%. This second quarter earnings season has started very strong in the U.S. with Verizon shares popping 4% yesterday following a Q2 earnings beat while Alphabet added over 2% ahead of its earnings out after the closing bell on Wednesday.
In Europe overnight, markets closed mixed to start the new trading week amid tariff uncertainty. The STOXX 600 fell 0.1%, Germany’s DAX closed flat, the French CAC fell 0.3% and, in the UK, the FTSE100 ended the day up 0.2%. Ryan Air shares rose 6% on Monday after the airline posted a 128% rise in Q1 profit which topped market expectations.
Across the Asia region on Monday, markets closed mixed as China held its key 1 and 5 year loan prime rates steady despite the struggling economic recovery in the region. China’s CSI index rose 0.67%, Hong Kong’s Hang Seng gained 0.57%, Japan’s Nikkei fell 0.21% and South Korea’s Kospi index ended the day up 0.71%.
Locally to start the new trading week, investors were in profit taking mode after the key index reset its record high to end the last trading week, leading to a 1.02% decline at the closing bell on Monday. Stocks that have run hot over the last 12-months like the big banks and some gold stocks came under pressure yesterday. Energy and Materials stocks were the only sectors to finish the day in the green while financials stocks took the biggest hit to start the new week 2.26% lower.
Block Inc (ASX:XYZ) soared over 11% yesterday on news the company is entering the S&P500 from this Wednesday after Chevron acquired Hess Corp which left room for Block to enter the major US index. AMP (ASX:AMP) also jumped 9.3% after the company released a strong Q2 update including superannuation positive net inflows for the first time since 2017.
Most traded securities:
- The most traded investments by Bell Direct clients to start the new week were led by:
- DroneShield (ASX:DRO)
- BHP (ASX:BHP)
- Mesoblast (ASX:MSB)
What to watch today:
- On the commodities front this morning oil is trading 0.56% lower at US$66.97/barrel, gold is up 1.4% at US$3397/ounce and iron ore is up 0.04% at US$97.22/tonne.
- The Aussie dollar has strengthened against the greenback overnight to buy 65.24 U.S. cents, 96.17 Japanese yen, 48.54 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.13% tracking the record closes on Wall Street overnight.
Trading ideas:
- Bell Potter has downgraded the rating on Perenti (ASX:PRN) from a buy to a hold and have maintained the 12-month price target on the materials company at $1.80 following the company’s issue of an updated noting that FY25 free cash flow is likely to be $280m vs the previous guidance of greater than $150m. The downgrade to a hold is on the back of recent share price appreciation.
- And Trading Central has identified a bullish signal on Whitehaven Coal (ASX:WHC) following the formation of a pattern over a period of 156 days which is roughly the same amount of time the share price may rise from the close of $6.42 to the range of $8.20 to $8.60 according to standard principles of technical analysis.
Wall Street closed mixed on Friday following reports President Trump pushed for greater tariffs on the European region. The Dow jones fell 0.32% on Friday, the S&P500 lost just 0.01% and the tech-heavy Nasdaq ended the day up 0.05%. Reports suggest Trump is demanding a minimum tariff between 15-20% from the EU ahead of the August 1 tariff implementation date. Consumer sentiment in the U.S. also out on Friday though suggests confidence levels are up 1.8% in the latest reading, indicating tariff-induced inflation fears are easing. We have started receiving first half earnings results in the U.S. and Netflix shares fell 5% on Friday after the streaming giant reported its operating margin will be lower in the second half of this FY.
Across the European region on Friday, markets closed mixed as investors digested the latest tariff threats on the region. Germany’s DAX fell 0.33%, the French CAC rose 0.01% and, in the UK, the FTSE100 ended the day up 0.22%.
The Asia region also ended Friday’s session mixed with China’s CSI index rising 0.6%, while Hong Kong’s Hang Seng gained 1.33%, South Korea’s Kospi index lost 0.13%, and Japan’s Nikkei ended the day down 0.21%.
The ASX200 posted a 2.1% gain for the week in its best week since May and ended the week with a fresh record high driven by market heavyweights like CSL (ASX:CSL) and BHP (ASX:BHP) jumping over 3% each. Mesoblast (ASX:MSB) rocketed over 34% on Friday after reporting strong early sales of Ryoncil in the first few months of its availability on market.
Virgin Australia (ASX:VGN) also gained almost 2% after UBS initiated coverage of the airline with a buy rating.
Most traded securities:
- The most traded investments by our clients on Friday were led by
- Wesfarmers (ASX:WES)
- BHP (ASX:BHP)
- ANZ (ASX:ANZ)
What to watch today:
- On the commodities front this morning oil is trading 0.36% lower at US$67.30/barrel, gold is up 0.32% at US$3349/ounce and iron ore is up 0.04% at US$97.22/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.18 US cents, 96.43 Japanese yen, 48.52 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of Monday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.56%.
Trading ideas:
- Bell Potter has raised the 12-month price target on Mesoblast (ASX:MSB) from $3.40 to $3.50 and maintain a speculative buy rating on the pharmaceutical company following the release of the company’s latest cashflow update including US$13.2m in gross sales from Ryoncil for the period of 28 March to 30 June 2025. The major catalysts include revenue expansion from Ryoncil and the unrecognised value of a likely Accelerated Approval for Revascor in late-stage heart failure in CY26.
- And Trading Central has identified a bullish signal on CSL (ASX:CSL) following the formation of a pattern over a period of 53-days which is roughly the same amount of time the share price may rise from the close of $257.38 to the range of $268 to $272 according to standard principles of technical analysis.
Defence spending surged to a record $2.7 trillion in 2024, with NATO and Indo-Pacific nations ramping up budgets amid ongoing geopolitical risks. Bell Potter sees strong growth ahead, with opportunities in direct plays like DroneShield (ASX:DRO) and broader exposure through ETFs like DFND and ARMR. While the sector has rallied, tailwinds remain - but investors should be mindful of risks like policy shifts and supply chain pressures.
In this week’s wrap, Grady covers:
• (0:14): factors behind the defence sector surge
• (2:16): risks facing the sector
• (2:50): opportunities for exposure in defence
• (4:26): how the market performed this week so far
• (5:28): the most traded stocks and ETFs by clients this week
• (5:54): economic news items to look out for.
US equities were higher on Wall Street overnight of the back of news headlines that President Donald Trump has denies firing Jerome Powell as Federal Reserve chairman, which initially sent the S&P500 index lower. The three major benchmarks rallied at the close. The Dow Jones added 200 points or 0.53%, the S&P500 gained 0.32% while the tech heavy Nasdaq added 0.25%.
European markets were all in the red. The German DAX down 0.2%, France’s CAC down 0.57%, the FTSE100 down 0.13% and the STAXX600 down 0.57%.
Locally yesterday on the ASX200, information technology and energy sectors were the only two to close in the green. Tech posted most of the market gains, closing 0.85% higher, while the ASX200 was down 0.79% at the close.
What to watch today:
- Our local market is set to rebound today. The SPI futures are suggesting a 0.62% rise at the open this morning.
- In commodities,
- Crude oil is 0.2% in the green, trading at US$66.66 per barrel at the time of recoding, following three straight days of losses, amid the concerns over the impact of the US trade tariffs on global economic growth and fuel demand.
- The price of gold is up 0.75% to US$3,349.73 an ounce, following a two-day decline, as investors assessed a pick-up in US inflation and ongoing trade developments.
- And iron ore is up 0.58% to US$97.06 per tonne.
Trading ideas:
- Bell Potter maintain a Speculative Buy rating on NexGen Energy (ASX:NXG), a Canadian focused Uranium explorer and developer. Bell Potter have reduced their valuation to $13.55 from $16.90. They expect NXG will trade in-line with the uranium spot price, given the leverage to volume linked (spot priced) contracts. The current share price is $10.24, therefore implying 32% share price growth in a year.
- And Trading Central have identified a bearish signal in Commonwealth Bank (ASX:CBA) indicating that the stock price may fall from the close of $177.57 to the range of $162 to $165 over 8 days, according to the standard principles of technical analysis.
Wall St closed mixed amid concerns over inflation after the latest data out for June overnight revealed US inflation increased from May with CPI rising 0.3% MoM to an annual rate of 2.7% while core inflation rose 0.2% MoM or 2.9% on an annual basis. The Dow Jones fell 0.98%, the Nasdaq gained 0.18% and the S&P500 ended the day down 0.4%.
In Europe overnight markets closed lower for a third straight session amid caution over a trade deal yet to be done with the US ahead of the tariff introduction date on August 1. The STOXX 600 fell 0.37%, Germany’s DAX lost 0.42%, the French CAC fell 0.54% and, over in the UK, the FTSE100 ended the day down 0.66%.
Locally to start the new trading week the ASX200 closed lower on Monday before a strong rebound on Tuesday where the key index gained 0.7% to reset its record high at the closing bell. A broad tech rally was the key driver of the market’s surge yesterday while investors also shrugged off the latest US Trump tariff threats.
Westpac consumer confidence data for July came out yesterday showing consumer confidence jumped 0.6% in July to 93.1 points despite the RBA rate hold as investors still expect a number of rate cuts this year.
What to watch today:
- Ahead of Wednesday’s trading session the SPI futures are anticipating the ASX will open the day down 0.73%.
- On the commodities front this morning, oil is trading 0.54% lower at 66 US dollars and 16 cents a barrel, gold is down 0.35% at 3331 US dollars an ounce and iron ore is up 0.05% at 96.76 US dollars a tonne.
Trading Ideas:
- Bell Potter has downgraded Technology One (ASX:TNE) from a hold to a sell and have slightly raised the 12-month price target on the company to $35.75 following recent share price appreciation. The sell rating is not due to a negative catalyst, but the market already expecting the company to beat expectations, so we don’t see a positive catalyst as there is not much upside risk to our and the market’s FY25 forecast.
- Trading Central has identified a bullish signal on SRG Global (ASX:SRG) following the formation of a pattern over a period of 14-days which is roughly the same amount of time the share price may rise from the close of $1.69 to the range of $1.87 to $1.91 according to standard principles of technical analysis.
Wall Street closed higher to start the new trading week in the green despite President Trump’s latest tariff threats over the weekend. The S&P500 rose 0.14%, the Nasdaq added 0.27% and the Dow Jones ended the day up 0.2%. Investors will gauge the first hit of tariffs on the region’s inflation this week when the latest U.S. inflation reading is out.
In Europe overnight markets closed mostly lower despite the UK finishing at a record high. The STOXX 600 fell just 0.06%, Germany’s DAX lost 0.39%, the French CAC fell 0.27%, and, in the UK, the FTSE100 ended the day up 0.64% to a fresh record high.
Across the Asia region on Monday, markets closed mixed as bitcoin hit a fresh record high while cautious investors assessed the latest Trump tariff threats. Hong Kong’s Hang Seng added 0.26%, China’s CSI index ended flat, Japan’s Nikkei lost 0.2% and South Korea’s Kospi index ended the day up by 0.83%.
The latest slew of China’s economic data is out this week and yesterday we had the first glimpse with coal imports falling to the lowest level in more than 2-years in June amid weak demand and higher domestic production. China’s steel exports on the other hand leapt to a record in Q2 reaching 30.7 million tonnes, up 11% from last year. The surge defied expectations, driven by strong demand and despite trade restrictions across Asia and Europe. The first-half total also rose by 9%. China’s trade balance for June showed exports jumped 5.8% which topped expectations and showed a 1% increase MoM while imports rose 1.1%, below expectations but above the -3.4% reported a month prior, leading to the trade surplus rising to $114bn which also topped expectations.
Another round of tariffs, another spike in investor uncertainty sparking a flee to safe-haven investments across the broad market yesterday. The ASX200 posted a 0.11% loss to start the new trading week lower after see-sawing all-day. Energy and materials stocks closed with gains over 0.5% while industrials and discretionary stocks were the hardest hit to start the new trading week.
Gold miners were all the rage for investors to start the new week amid heightened volatility brought on by renewed tariff uncertainty. Northern Star Resources (ASX:NST) rose 1.72%, Evolution Mining (ASX:EVN) added 1.88% and Ramelius Resources (ASX:RMS) ended the day up 3.4%.
Counter drone technology company DroneShield (ASX:DRO) soared another 15% yesterday after the company reported the expansion of its R&D capabilities including a $13m initial investment to lease and fit out a brand new 3000 sqm production facility in Alexandria.
Most traded securities:
- The most traded investments by Bell Direct clients to start the new week were led by
- BHP (ASX:BHP)
- DroneShield (ASX:DR)
- Andean Silver (ASX:ASL)
- Betashares Global Defence ETF (ASX:ARMR)
What to watch today:
- On the commodities front this morning oil is trading 2.28% lower at US$66.89/barrel, gold is down 0.4% at US$3343/ounce and iron ore is up 0.05% at US$96.76/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.47 U.S. cents, 96.75 Japanese yen, 48.55 British pence and 1 New Zealand dollar and 10 cents.
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.64%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Paladin Energy (ASX:PDN) from $6.50 to $9.20 and maintain a buy rating on the uranium producer ahead of some catalysts coming up including the outlook for a re-rate on the company over the coming quarters with predicted fresh ore processing outperforming the stockpile issues which plagued FY25.
- Trading Central has identified a bearish signal on PWR Holdings (ASX:PWH) following the formation of a pattern over a period of 15-days which is roughly t
Wall Street closed lower on Friday after President Trump announced a 35% tariff on Canada and threatened higher tariffs across the board. The S&P500 retreated 0.33% a day after posting a fresh record high, the Nasdaq lost 0.22% and the Dow Jones ended the day down 0.63%.In Europe on Friday, markets closed lower as investors awaited the highly anticipated tariff letter to arrive from President Trump outlining the damage of tariffs set to come. The STOXX 600 lost 1.1%, Germany’s DAX and the French CAC each lost 0.9% and, in the UK, the FTSE100 ended the day down 0.4%.
Across the Asia region on Friday, it was a mixed session after President Trump announced a blanket 15% or 20% tariff on most trade partners. Hong Kong’s Hang Seng rose 0.75%, China’s CSI index rose 0.12%, Japan’s Nikkei slipped 0.19% and South Korea’s Kospi index ended the day down 0.23%.
Locally to end the last trading week, the ASX200 posted a 0.11% loss as every sector aside from materials stocks ended the day in the red. For the week, the ASX200 posted a 0.27% loss as strong declines among REIT and tech stocks offset strength among utilities and materials stocks.
Rare earths producers locally surged on Friday after the US Department of Defence agreed to take a 15% stake in MP Materials, a US-based rare earths producer. Lynas Rare Earths (ASX:LYC) rose over 16% on Friday while Arafura Rare Earths (ASX:ARU) added 5.56%.
Johns Lyng Group (ASX:JLG) soared over 21% on Friday after announcing it has agreed to a $1bn takeover offer from Pacific Equity Partners, an Australian-based private markets fund manager.
Most traded securities:
- The most traded stocks by Bell Direct clients on Friday were led by
- CSL (ASX:CSL)
- Neuren Pharmaceuticals (ASX:NEU)
- NAB (ASX:NAB)
- And the most traded ETFs were led by
- Vanguard Australian Shares Index ETF (ASX:VAS)
- Betashares Nasdaq 100 ETF (ASX:NDQ)
- Vanguard Msci Index International Shares ETF (ASX:VGS)
What to wach today:
- On the commodities front this morning oil is trading 3.27% higher at US$68.75/barrel, gold is up 0.92% at US$3354.76/ounce and iron ore is down 0.05% at US$96.71/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.64 U.S. cents, 96.60 Japanese yen, 45.91* British pence and 1 New Zealand dollar and 9 cents.
- Ahead of the first trading session of the new week, the SPI futures are anticipating the ASX will open the day down 0.15% tracking the global market turbulence overnight.
Trading ideas:
- Bell Potter has initiated coverage of Kinatico (ASX:KYP) with a buy rating and a 12-month price target of 30cps. The company is a leading provider of ‘know your people’ solutions to organisations across Australia and NZ with a legacy business – CVCheck – which provides employment screening to over 10,000 repeat corporate customers. Bell Potter’s analyst sees the buy rating is supported by upcoming catalysts including FY25 results, positive outlook statements and the successful launch of ComplianceX this quarter with strong initial take-up of the solution.
- And Trading Central has identified a bearish signal on Tasmea (ASX:TEA) following the formation of a pattern over a period of 22-days which is roughly the amount of time the share price may fall from the close of $3.37 to the range of $2.65 to $2.80 according to standard principles of technical analysis.
The RBA held rates steady this week, surprising markets but aligning with its wait-and-see approach ahead of upcoming CPI data. Meanwhile globally, Trump confirmed tariffs will rise from August 1, sparking volatility across the markets. On one hand, copper jumped on news of a 50% US import tariff, with traders rushing to reroute shipments. However, the prospect of a 200% tariff on imported drugs has rattled healthcare producers, with CSL advocating for targeted measures over blanket tariffs to avoid disrupting global supply chains.
In this week’s wrap, Grady covers:
- (0:10): the RBA’s shock rate hold and future outlook
- (1:13): Trump’s August 1 tariff date and how the market reacted
- (2:02): the impact of fresh tariff threats on the copper and healthcare sectors
- (4:38): how the market performed this week so far
- (5:20): the best and worst performing stocks and ETFs this week
- (5:48): economic news items to look out for.
Wall Street recovered to close higher on Wednesday as investors shrugged off the latest tariff noise to buy into tech and other growth market areas again. The Nasdaq rose 0.94% boosted by Nvidia shares climbing 1.8%, the S&P500 added 0.61%, and the Dow Jones ended the day up 0.5%. On Wednesday, Trump sent a further 6 letters to countries outlining new tariffs on imports of goods bound for the U.S.
In Europe overnight, markets closed at a four-week high boosted by the banks as investors await progress on trade talks between the U.S. and the EU. The STOXX600 rose 0.78%, Germany’s DAX added 1.42%, the French CAC climbed 1.44%, and, in the UK, the FTSE100 ended the day up 0.15%.
Across the Asia markets on Wednesday, it was a mixed session after President Trump ruled out any extension to the tariff deadline of August 1. Japan’s Nikkei added 0.33%, Hong Kong’s Hang Seng fell 1.06%, China’s CSI index lost 0.18% and South Korea’s Kospi index ended the day flat.
The Australian share market dropped 0.61% on Wednesday following US President Donald Trump's escalation of his protectionist trade war, as he reiterated threats to impose higher tariffs on copper imports.
Lifestyle Communities (ASX:LIC) saw a dramatic drop of over 40% following a landmark tribunal ruling that deemed its profitable deferred management fees, or exit fees, imposed on residents to be invalid under state tenancy laws.
Telix Pharmaceuticals (ASX:TLX) surged 6% following the announcement that its prostate cancer imaging product, Gozellix, has been assigned a permanent code by the US Centres for Medicare & Medicaid Services, effective October 1.
Most traded securities:
- Most traded stocks and ETFs of the day yesterday by our clients were led by
- BHP (ASX:BHP)
- Ampol (ASX:ALD)
- Global X Physical Gold ETF (ASX:GOLD)
What to watch today:
- On the commodities front this morning oil is trading 0.21% higher at US$68.32/barrel, gold is up 0.36% at US$3313.36/ounce and iron ore is up 0.35% at US$95.55/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.34 U.S. cents, 95.61 Japanese yen, 48.05 British pence and 1 New Zealand dollar and 9 cents.
- Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.5%.
Trading ideas:
- Bell Potter has decreased the 12-month price target on Lifestyle Communities (ASX:LIC) from $8.55 to $5.00 and maintain a hold rating on the company following the receipt of judgement from ongoing VCAT proceedings relating chiefly to its use of a deferred managed fee structure.
- And Trading Central has identified a bullish signal on Data3 (ASX:DTL) following the formation of a pattern over a period of 182 days which is roughly the same amount of time the share price may rise from the close of $7.79 to the range of $9.80 to $10.20 according to standard principles of technical analysis.
Wall Street closed mixed on Tuesday as investors assessed the latest comments out of President Trump on the tariff front whereby he said there will be no exceptions to his August 1 tariff start date. The S&P500 lost just 0.07%, the Dow Jones dipped 0.37% and the Nasdaq ended the day up 0.03%.
In Europe overnight, markets in the region closed higher as investors hope trade deals can be done between the US and key European countries in the near future. The STOXX 600 rose 0.3%, and Germany’s DAX, the French CAC and the UK’s FTSE 100 ended the day up 0.5% each.
Across the Asia region on Tuesday, it was positive despite investors assessing President Trumps’ latest tariff threats on 14 key trading partners. Imports from Japan, South Korea, and Malaysia among other countries are now set to face tariffs of 25% starting August 1 according to Trump’s latest post on his social platform, Truth Social. Japan’s Nikkei rose 0.26% on Tuesday, South Korea’s Kospi Index ended the day up 1.81%, China’s CSI index rose 0.84% and Hong Kong’s Hang Seng added 1.09%.
The local market closed Tuesday’s session flat as investors were shocked by the RBA’s surprise rate hold announcement whereby Australia’s cash rate will remain at 3.85% for the next period amid global uncertainty on the tariff front and Australia’s tight labour market. RBA governor Michele Bullock said Australia’s central bank is really conscious of not wanting to end up with a fight against inflation again and they want to make sure they have ‘nailed’ inflation before cutting again.
Following the RBA’s shock rate hold on Tuesday afternoon, the ASX dipped but recovered just before the closing bell with staples and utilities stocks taking the biggest hit, while tech and communication services offset some of the losses.
Some broker moves sparked stock reactions yesterday with South32 (ASX:S32) sliding almost 2% after Goldman Sachs cut its outlook on the company to Neutral while Domino’s Pizza (ASX:DMP) rallied over 2% after UBS upgraded the stock to a buy, and Guzman Y Gomez (ASX:GYG) fell 4% after JPMorgan initiated coverage on the stock on Monday with an underweight rating.
What to watch today:
- On the commodities front this morning, oil is trading 0.7% higher at US$68.40/barrel, gold is down 0.92% at US$3306/ounce and iron ore is up 0.35% at US$95.55/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.31 US cents, 95.77 Japanese Yen, 48.12 British pence and 1 New Zealand dollar and 9 cents.
- And ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.08%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Cobram Estate Olives (ASX:CBO) from $1.95 to $2.35 and maintain a hold rating on the olive oil producer following the company’s provision of a FY25 production and earnings guidance update. CBO expects production to come in below BPe but EBITDA expectations of $115m top BPe of $113m.
- Trading Central has identified a bullish signal on Lycopodium (ASX:LYL) following the formation of a pattern over a period of 99-days which is roughly the same amount of time the share price may rise from the close of $11.29 to the range of $12.50 to $12.80 according to standard principles of technical analysis.
Wall St closed lower to start the new week as President Trump reportedly posted letters to countries indicating new tariff terms and amounts that will come into play once the July 9 waiver deadline ends. The Dow Jones fell 0.94% on Monday, the S&P 500 lost 0.79% and the tech-heavy Nasdaq ended the day down 0.92%.
Imports from at least 7 countries will face hefty tariffs from August 1 according to Trump’s latest posts on his social platform, Truth social.
In Europe overnight, markets mostly rose before Trump’s latest tariff updates were revealed. The STOXX 600 rose 0.4%, Germany’s DAX added 1.1%, the French CAC climbed 0.4%, and, in the UK, the FTSE100 ended the day down just 0.2%.
Across the Asia region overnight, markets closed mixed as Trump’s tariff deadline day tomorrow looms and on the back of Trump announcing reciprocal tariffs will commence from August 1. China’s CSI index fell 0.43%, Hong Kong’s Hang Seng lost 0.61%, Japan’s Nikkei dropped 0.56%, and South Korea’s Kospi index ended the day up 0.17%.
Locally to start the new trading week, the ASX200 slipped into the red to post a 0.16% loss following the record close on Friday as investors await the RBA’s rate announcement today and ahead of Trump’s tariff waiver deadline tomorrow.
Investors are increasingly on edge ahead of Trump’s tariff waiver deadline ending on Wednesday 9th July as widespread concerns revolve around trade deals not being done thus leading to hefty tariffs disrupting trade moving forward. The local market is following the trends of global markets from late last week as investor optimism fades ahead of Wednesday’s tariff deadline. Given the key index is trading around record territory of late, investors are also likely awaiting the RBA’s rate decision today before making any big moves.
Ahead of the RBA’s anticipated rate cut out today, investors also took profits from the banks as banks tend to perform worse in a lower interest rate environment.
Investors and the market are factoring in a 97% chance of a rate cut out of the RBA today to the effect of a 25-basis point cut. Should the RBA announce a cut we will likely see the tech, REIT and discretionary sectors continue to rally as such sectors tend to outperform in a lower interest rate environment.
Northern Star Resources (ASX:NST) tumbled 6% on Monday after the gold miner announced its production showed output at the lower end of guidance, while Origin Energy (ASX:ORG) rose over 5% on reports that UK start-up Octopus Energy, which Origin has a 23% stake in, is planning to demerge its tech division.
What to watch today:
- On the commodities front this morning oil is trading 2.36% higher at US$68.02/barrel, gold is up 0.03% at US$3336.19/ounce and iron ore is down 1.06% at US$95.22/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.89 US cents, 94.77 Japanese yen, 47.76 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day down 0.55%.
Trading Ideas:
- Bell Potter has initiated coverage of Titomic (ASX:TTT) with a speculative buy rating and a 12-month price target of $0.50/share. Titomic is an Australian company at the forefront of industrial-scale metal additive manufacturing and Bell Potter’s analyst sees the increasing spend in defence, especially to come in the US, as a growth opportunity for Titomic.
- And Trading Central has identified a bullish signal on Origin Energy (ASX:ORG) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $11.55 to the range of $12.00 to $12.20 according to standard principles of technical analysis.
Wall St was closed for the July 4 Independence Day holiday on Friday.
Over in Europe on Friday markets closed mostly lower ahead of Trump’s looming tariff deadline day. The STOXX 600 fell 0.5%, Germany’s DAX lost 0.6%, the French CAC fell 0.8%, and, in the UK, the FTSE 100 ended the day flat.
Across the Asia region on Friday, markets similarly closed mostly lower as investors fear the end of the tariff waiver deadline will mean tariffs will be imposed immediately with a high effect. Hong Kong’s Hang Seng fell 0.64%, Japan’s Nikkei closed flat, China’s CSI index rose 0.36% and South Korea’s Kospi index ended the day down almost 2%.
Locally on Friday and to end the first trading week of July, the ASX200 posted a 0.1% gain, resetting its record for a second time already this financial year and for the last trading week the index rose 1.04%.
Following a stellar year for financial stocks in FY25, we have seen valuations stretched above growth outlook which prompted investors to take some profits and diversify into areas of the market that either have a high growth outlook like the AI movement in tech or that have been sold off sharply in FY25 presenting strong buy opportunities at present. CBA (ASX:CBA) shares fell almost 1% on Friday.
Shares in small-cap container operator Silk Logistics (ASX:SLH) jumped 22.4% after receiving approval from the competition regulator for its acquisition by Dubai-based DP World.
The Aussie dollar has weakened against the greenback to buy 65.63 US cents, 94.77 Japanese yen, 48 British pence, and 1 New Zealand dollar and 8 cents.
What to watch today:
- On the commodities front this morning, oil is trading 0.56% lower at US$66.46/barrel, gold is up 0.3% at US$3335/ounce and iron ore is up 1.17% at US$96.24/tonne.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day flat.
- And now let’s dive into some trading ideas for your consideration today.
Trading ideas:
- Bell Potter has downgraded the rating on Pro Medicus (ASX:PME) from a buy to a hold and have raised the 12-month price target on the leading imaging healthcare tech company to $320/share following the company announcing the renewal and extension of its contract with Franciscan Missionaries of Our Lady Health System in Louisiana and announced a second and larger deal with U. Colorado Health.
- Trading Central has identified a bullish signal on AMP (ASX:AMP) following the formation of a pattern over a period of 88-days which is roughly the same amount of time the share price may rise from the close of $1.43 to the range of $1.66 to $1.72 according to standard principles of technical analysis.
FY25 ended with the ASX200 up 10%, driven by gains in tech, financials and discretionary stocks. Meanwhile, materials and energy lagged amid tariffs, China’s slow recovery, and global tensions. Looking to FY26, rate cuts, easing trade risks and sector catalysts could support further growth. Bell Potter sees opportunities in healthcare, uranium, and select defensives and REITs poised to benefit from lower rates and shifting investor sentiment.
In this week’s wrap, Grady covers:
- (0:42): winning and losing sectors in FY25
- (2:35): Bell Potter’s outlook for FY26 and sectors to watch
- (4:27): how the market performed this week so far
- (5:08): the best and worst performing stocks and ETFs this week
- (5:036): economic news items to look out for.
Wall Street closed mostly higher on Wednesday after President Trump announced a U.S.-Vietnam trade deal has been reached to the effect of 20% tariffs on goods imported from Vietnam into the U.S. Investors welcomed the news despite fresh economic data also out yesterday showing private payrolls in the U.S. surprisingly declined in June. The S&P500 ended the day up 0.47% to a fresh record high of 6227.42 points while the Dow Jones fell just 0.02% and the tech-heavy Nasdaq ended the day up 0.94%.
In Europe on Wednesday, markets in the region closed mostly higher despite volatility in the UK. The STOXX 600 rose 0.2%, Germany’s DAX added 0.5%, the French CAC climbed 1% and, in the UK, the FTSE100 ended the day down 0.1%.
Across the Asia region on Wednesday, markets closed mixed as investors assessed US Fed Chair Jerome Powell’s latest comments around further rate cuts would have already happened if it weren’t for President Trump’s tariff initiatives. China’s CSI index closed flat, Hong Kong’s Hang Seng rose 0.73%, Japan’s Nikkei slipped 0.5% and South Korea’s Kospi Index ended the day down 0.47%.
The local market reset its record yesterday with the key index ending the day up 0.66% with 10 of the 11 sectors ending the day higher led by materials stocks rallying 1.83%.
Retail sales data out yesterday locally for May came in at a rise of 0.2% MoM which fell short of the 0.4% rise markets were expecting, signalling consumer discretionary spend remains subdued due to higher cost-of-living pressures and overall uncertainty. Much to the listed retailer relief though, retail spend in May was boosted by a bounce-back in clothing purchases, albeit at a time when a large number of retailers held higher promotional activity to reduce inventory levels. Other than clothing spend rebounding, retail spending was otherwise restrained this month, with a drop in food-related spending and flat results across household goods.
Qantas (ASX:QAN) shares tumbled 2.2% after the flying kangaroo confirmed it has been hit by a cyber attack affecting the personal data of more than 6 million customers.
Lenders Mortgage Insurance provider Helia Group (ASX:HLI) sank over 20% yesterday on news that another major long-term partner in ING Bank was negotiating a deal with alternative providers. The move comes just months after CBA pulled the pin on its LMI deal with Helia.
Domino’s Pizza (ASX:DMP) shares also fell almost 16% after the company’s CEO Mark van Dyck announced he will step down from the role after just 12 months at the helm.
What to watch today:
- On the commodities front this morning oil is trading 3.2% higher at US$67.54/barrel, gold is up 0.57% at US$3357.35/ounce and iron ore is up 1.84% at US$95.13/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.86 US cents, 94.59 Japanese yen, 48.28 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX will open the day down 0.21%.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Santana Minerals (ASX:SMI) from $1.30 to $1.18 and maintain a speculative buy rating on the gold miner following the release of the company’s updated Pre-Feasibility Study for its 100% owned Bendigo-Ophir Gold Project in New Zealand. It is well placed to complete its Fast Track application, commence early site works in 2HCY25, make a Final Investment Decision in early CY26 and commence construction in 1HCY26. It remains one of the nearest term, new gold development projects on the ASX and is why the analyst has maintained a spec buy rating on the company.
Wall Street closed mixed to start the new quarter as investors rotated out of tech stocks to start the new quarter. The Dow Jones rose 0.91%, the S&P 500 fell 0.11% and the tech-heavy Nasdaq ended the day down 0.82%. Investors are also weighing the latest developments with President Trump’s major tax and spending bill while assessing comments from Fed Chair Jerome Powell around the rate outlook in the US.
In Europe overnight, markets closed mostly lower as investors monitored the European Central Bank’s annual forum in Portugal. The STOXX 600 fell 0.2%, Germany’s DAX lost 0.8%, the French CAC closed flat, and, in the UK, the FTSE 100 ended the day up 0.3%.
Across the Asia region on Tuesday, markets closed mixed as investors assessed record gains on Wall St to end June and remain concerned over the global impact of tariffs amid the looming deadline day next week. China’s CSI index rose 0.17%, Hong Kong’s Hang Seng was closed for a public holiday, Japan’s Nikkei fell 1.24%, and South Korea’s Kospi index ended the day up 0.6%.
The ASX200 started the new trading month virtually flat as investors regrouped to navigate the start of FY26 with headwinds in the form of geopolitical tensions, trade wars and elevated valuations creeping in from FY25.
Over the last 12-months financials stocks have soared over 26% led by sector heavyweight CBA (ASX:CBA) which has experienced share price appreciation of 45% as investors flocked to safe haven investments during the last 12-months of elevated volatility and uncertainty. For the same reason, gold stocks have also been on a tear over the last financial year.
Heading into the new year, the first session of FY26 was uneventful as investors still await clarity on the tariff front, particularly on the outcome of talks between the US and China. Both rate sensitive sectors in tech and real estate stocks offset weakness among industrials and materials stocks on Tuesday.
Superannuation takeover target Insignia Financial (ASX:IFL) rallied over 5% on Tuesday after final takeover bidder, CC Capital, said it would continue working toward making a binding offer for the company after months and other bidders involved in the deal.
And in the healthcare space Mesoblast (ASX:MSB) shares rose over 8.5% after the company announced progress of its treatments with the US FDA toward commercialisation, with the company intending to file by the end of the year for accelerated approval.
What to watch today:
- On the commodities front this morning, oil is trading 0.45% higher at US$65.40/barrel, gold is up 1.04% at US$3337.65/ounce, and iron ore is down 1.12% at US$93.41/tonne.
- The Aussie dollar has weakened against the greenback to buy 65.72 US cents, 94.51 Japanese Yen, 47.85 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.21%.
Trading Ideas:
- Bell Potter has maintained a buy rating on Perenti (ASX:PRN) and have raised the 12-month price target to $1.80 from $1.45 following the announcement of a contract win at the Great Fingall underground project with Westgold Resources (ASX:WGX) in WA worth $200m over 3-years.
- And Trading Central has identified a bullish signal on Yancoal (ASX:YAL) following the formation of a pattern over a period of 9-days which is roughly the same amount of time the share price may rise from the close of $5.91 to the range of $6.70 to $6.90 according to standard principles of technical analysis.
US equities brushed off the mid- session nerves as both the S&P500 and the Nasdaq reset the closing record highs, advancing 0.52% and 0.47% respectively, while the Dow Jones climbed 275 points or 0.63%. Gains followed the announcement that Canada revokes its digital service tax to facilitate trade negotiations with the US. And as President Donald Trump’s 90- day tariff postponement is scheduled to expire next week, investors are watching out for announcements of any trade deals between the US and its trading partners.
European markets closed in the red. The German DAX down 0.51%, France’s CAC down 0.33%, the FTSE 100 down 0.43% and the STOXX600 down 0.42%.
Locally yesterday, the ASX200 advanced 0.33% with healthcare, industrials and consumer discretionary industry sectors in the lead. Meanwhile, materials declined the most, with Deep Yellow (ASX:DYL), Nickel Industries (ASX:NIC) and Lynas Rare Earths (ASX:LYC), the worst performing stocks of the session.
What to watch today:
- The Australian market is set to open slightly lower this morning, down just 0.07% according to the SPI futures.
-
In commodities,
- Crude oil is down 0.8% and more than 5% over the week, now trading just under US$65 per barrel, amid easing tensions in the Middle East as well as prospects that OPEC+ will further increase its oil output.
- The safe-haven gold price is 1.1% in the green, trading at US$3,304 an ounce, after hitting an over one- month low earlier in the session as trade talks progress.
- And iron ore is trading flat at US$94.47 per tonne.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on WA1 Resources (ASX:WA1) and have reduced their valuation from $26.50 to $25.70. At the current share price of $15.84, this implies 63% share price growth in a year.
- And Trading Central have identified a bullish signal in Regis Healthcare (ASX:REG) indicating that the stock price may rise from the close of $7.84 to the range of $8.60 to $8.80 over 21 days, according to the standard principles of technical analysis.
Wall Street closed higher on Friday as investors looked past President Trump’s latest swipe at Canada. The S&P500 rose 0.52% to close at a fresh record high while the Dow Jones added 1% and the Nasdaq ended the day up also 0.52% and also to a fresh record high. On Friday President Trump posted on truth social, his social media platform, that talks between the U.S. and Canada were being terminated. Investors remain confused about the global tariff situation amid the looming July 9 tariff delay deadline, but pushed stocks higher on Friday on reports that the U.S. is close to announcing trade deals with 10 major partners.
In Europe on Friday, markets closed higher on optimism of improving trade talks between the U.S. and China. The STOXX 600 rose 1.1%, Germany’s DAX added 1.5%, the French CAC climbed 1.8% and, in the UK, the FTSE100 ended the day up 0.7%.
Across the Asia region on Friday, markets closed mixed as investors assessed China’s May industrial output data indicating industrial profits fell 9.1% over the first 5-months of the year. China’s CSI index fell 0.61%, Hong Kong’s Hang Seng lost 0.17%, Japan’s Nikkei rose 1.43% and South Korea’s Kospi index ended the day down 0.77%.
Locally on Friday the key index posted a 0.43% loss as a sharp sell-off in financials, healthcare and REIT stocks weighed on the key index. For the week, the ASX200 posted a 0.1% gain though led by financials and materials stocks posting over 1.5% gains each.
Reece (ASX:REH) tumbled over 18% on Friday after announcing its FY25 earnings were expected to fall significantly from the year prior, while Woolworths (ASX:WOW) shares fell 1% despite the supermarket giant announcing it will close its loss-making MyDeal marketplace just 3-years after purchasing it.
What to watch today:
- The Aussie dollar has weakened against the greenback to buy 65.38 U.S. cents, 94.36 Japanese yen, 47.62 British pence and 1 New Zealand dollar and 8 cents.
- On the commodities front this morning oil has continued to retreat, trading down 0.26% at US$65.07/barrel, uranium is up 0.7% at US$ 79.05/pound, gold is down 1.65% at US$3273.67/ounce, and iron ore is up 0.01% at US$94.49/tonne.
- Ahead of the first trading session of the new week the SPI futures are anticipating the ASX will open the day up 0.06%.
Trading ideas:
- Bell Potter has decreased the 12-month price target on Chalice Mining (ASX:CHN) from $5.75 to $4.10 and maintain a speculative buy rating on the copper miner following key updates out of the company confirming the development plan for its 100%-owned Gonneville project near Perth. The updates give the market greater clarity on the project development milestones with the plan striking the right balance between value extraction and mining and processing routes that minimise capex.
- And Trading Central has identified a bullish signal on Data3 (ASX:DTL) following the formation of a pattern over a period of 59-days which is roughly the same amount of time the share price may rise from the close of $7.51 to the range of $8.90 to $9.30 according to standard principles of technical analysis.
Markets remained volatile this week as global indices pushed toward record highs despite geopolitical tensions and the looming end of the tariff pause on July 9. Gold briefly lost ground as ceasefire hopes between Israel and Iran settled nerves, but upside risks remain. Meanwhile, Bell Potter’s latest Analyst Outlook & Stock Picks report highlights opportunities in agriculture, tech, healthcare and gold. Discover their standouts, each backed by strong fundamentals and sector-specific tailwinds.
In this week’s wrap, Sophia covers:
- (0:12): the impact of tariffs and geopolitical tensions on the market
- (0:50): Bell Potter’s stock picks
- (2:54): factors behind gold’s recent performance
- (3:50): how the market performed this week so far
- (4:50): the best and worst performing stocks and ETFs this week
- (5:16): economic news items to look out for.
Wall Street closed mixed on Wednesday as investors await clarity on ceasefire reports out of Iran and Israel. The S&P 500 was little changed, the Nasdaq added 0.31% and the Dow Jones ended the day down 0.25%.
Investors bought into the some of magnificent 7 overnight sending Nvidia shares up 4.3% to a fresh record high while Alphabet added 2.3%.
In Europe overnight, markets closed lower despite a strong rally for defence stocks amid uncertainty over the Middle East war. The STOXX600 fell 0.7%, Germany’s DAX dropped 0.6%, the French CAC lost 0.8%, and in the UK, the FTSE100 ended the day down 0.5%.
Across the Asia region on Wednesday markets closed mostly higher as investors weighed up ceasefire hopes against fresh commentary out of the U.S. Fed where Powell said policymakers were "well positioned to wait to learn more about the likely course of the economy before considering any adjustments to our policy stance." Hong Kong’s Hang Seng rose 1.22% on Wednesday, China’s CSI index climbed 1.44%, Japan’s Nikkei added 0.4% and South Korea’s Kospi index ended the day up 0.15%.
Locally on Wednesday, the ASX200 posted a mere 0.04% gain as a more than 1% rally for financials stocks offset weakness among the materials and energy sectors.
The monthly CPI read coming in below market forecasts at a rate of 2.1% for May signals the RBA is on track to consider another rate cut in the very near future which fueled tailwinds for the REIT and Discretionary sectors today, both of which perform better in lower interest rate environments. Sentiment remains shaky though on a global scale as investors are stuck in a limbo of asking if the ceasefire is or is not going ahead in the Middle East. It is a watch-and-wait situation as it continues to unfold.
As global defence spend ramps up, DroneShield (ASX:DRO) shares are flying with the company announcing yesterday the receipt of a $61.6m for European military, marking its biggest contract in company history. Shares in the counter drone tech company soared over 20% on Wednesday following the deal announcement.
What to watch today
- On the commodities front this morning oil is trading 0.87% higher at US$64.93/barrel, uranium is up a further 0.45% at US$77.90/pound, gold is up 0.3% at US$3332.26/ounce and iron ore is down 0.12% at US$94.52/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.17 U.S. cents, 94.41 Japanese yen, 47.71 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX will open the day down half a percent.
Trading Ideas
- Bell Potter has increased the 12-month price target on DroneShield (ASX:DRO) from $1.50 to $2.60 and maintain a buy rating on the counter-drone technology company following the announcement of the company’s record contract receipt valued at $61.6m, indicating significant earnings growth, increasing scale and frequency of contracts and industry tailwinds.
- And Trading Central has identified a bearish signal on Fletcher Building (ASX:FBU) following the formation of a pattern over a period of 79-days which is roughly the same amount of time the share price may fall from the close of $2.67 to the range of $2.21 to $2.31 according to standard principles of technical analysis.
Wall St closed higher on Tuesday as investors hold onto hopes of a ceasefire in the Middle East. The Dow Jones rose 1.2%, the S&P500 added 1.11% and the Nasdaq ended the day up 1.43%.
While President Trump reported on Tuesday morning that a ceasefire between Iran and Israel has been agreed upon, reports then followed that Iran has not agreed to a ceasefire thus sparking fears of prolonged tensions. Despite this confusion, markets still rallied, and energy stocks plummeted amid the dive in the price of oil overnight.
In Europe overnight, global hopes of a ceasefire boosted markets in the region with the STOXX 600 rising 1.2% on Tuesday while Germany’s DAX added 1.6%, the French CAC rose 1% and, in the UK, the FTSE100 ended the day flat. Oil and gas stocks weighed on market gains in the region amid the tumbling price of energy commodities due to the lack of supply concerns from the Middle East that initially led to a spike when the war between Iran and Israel first broke out.
Across the Asia region on Tuesday, positive global sentiment on ceasefire hopes extended into the region with markets closing higher led by South Korea’s Kospi Index rising 2.96%, while Hong Kong’s Hang Seng added 2.06%, China’s CSI index gained 1.2% and Japan’s Nikkei added 1.14% on Tuesday.
Ceasefire talks in the Middle East boosted global investor sentiment overnight leading to the local market rallying 0.95% on Tuesday led by materials stocks posting a near 2% gain, while the energy sector tumbled almost 4% on the sliding price of oil.
Two local IPOs had investors hitting the buy button yesterday with Greatland Gold (ASX:GGP) jumping 7.9% on debut while Virgin Australia (ASX:VAH) shares also took flight on IPO with the airline ending its re-debut session up over 8%.
KFC Australia operator Collins Food (ASX:CKF) soared 16.5% yesterday despite announcing weaker results for FY25 including NPAT down almost 15% and the full year dividend down 7%. Investors likely welcomed the strength of results in the second half of FY25 and revenue increasing over 2%.
What to watch today
- On the commodities front this morning oil has extended its decline to trade 5.92% lower at US$64.45/barrel, uranium is up 2.17% at US$77.55/pound, gold is down 1.51% at US$3317.46/ounce and iron ore is down 0.02% at US$94.75/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.04 US cents, 94.12 Japanese Yen, 47.86 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session in Australia the SPI futures are anticipating the ASX will open the day up 0.06% tracking global market gains overnight.
Trading Ideas
- Bell Potter has downgraded the rating on Adairs (ASX:ADH) from a buy to a hold and have reduced the 12-month price target on the company from $2.65 to $2.10 following the release of Adairs’ Q4 results including higher fixed costs and the company’s Focus on Furniture division down 9.3% on the PCP amid tough market headwinds.
- And Trading Central has identified a bearish signal on Ampol (ASX:ALD) following the formation of a pattern over a period of 33-days which is roughly the same amount of time the share price may fall from the close of $25.34 to the range of $23.40-$23.80 according to standard principles of technical analysis.
Wall Street started the new trading week with a surprising but welcome rally as investors welcomed the delayed reaction by Iran to the U.S. launching an attack on its nuclear facilities over the weekend. Oil prices tumbled overnight as investors now bet the impact of the Middle East war won’t be as great as was first expected on global oil supply from the region. The S&P500 rose 0.96% on Monday, the Dow Jones gained 0.89% and the tech-heavy Nasdaq ended the day up 0.94%.
In Europe overnight markets extended their losing run to close lower as investors in the region still fear retaliation from Iran may be incoming. The STOXX 600 fell 0.25% on Tuesday, while Germany’s DAX lost 0.3%, the French CAC closed 0.7% lower and, in the UK, the FTSE 100 ended the day down 0.2%.
Across the Asia markets on Monday it was a mostly negative session following the U.S. attack on Iran over the weekend sparking further concerns of escalated and prolonged tensions in the Middle East and beyond. Japan’s Nikkei fell 0.13%, Hong Kong’s Hang Seng rose 0.67%, China’s CSI index gained 0.2% and South Korea’s Kospi index ended the day down 0.24%.
The ASX started the new trading week in the red with a 0.36% loss at the closing bell as investors fear Iran will respond to the US attacks over the weekend, which is the key driver of oil and uranium prices rising further overnight. The US entering the Middle East war takes the conflict from a regional to global war, spreading fear and further uncertainty among global markets and investors. Financial stocks were up due to their safe-haven nature in the local market while energy stocks are on a run amid fears of impact on global oil supply due to the Middle East war. Industrial, healthcare and staples stocks took the biggest hit on the local market to start the week with losses over and near 1% each.
Homewares retailer Adairs (ASX:ADH) followed the recent retailer trend by plunging over 20% on Monday after warning the FY25 earnings will come in below FY24’s amid elevated promotional activity eating into margins on the back of a slow down in consumer spend.
What to watch today
- On the commodities front this morning oil has tumbled 8.85% to trade at US$67.49/barrel, uranium is up 1.5% at US$75.90/pound, gold is up 0.03% at US$3370/ounce and iron ore is down 0.02% at US$94.75/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.64 U.S. cents, 94.41 Japanese yen, 47.63 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Tuesdays trading session the SPI futures are anticipating the ASX will open the new trading day up 0.73%. Virgin Australia is also set to rejoin the key index today through an IPO pricing the company at $2.90/share.
Trading Ideas
- Bell Potter has downgraded the rating on Smartpay Holdings (ASX:SMP) from a buy to a hold and have reduced the 12-month price target on the full-service provider of payment solutions after the company announced it has entered into a Scheme Implementation Agreement with Shift4Payments to be acquired at a cash price of NZ$1.20/share. The analyst believes the offer is opportunistic and undervalues the quality of the asset.
- Trading Central has identified a bearish signal on Woolworths Group (ASX:WOW) following the formation of a pattern over a period of 28-days which is roughly the same amount of time the share price may fall from the close of $31.41 to the range of $30.20 to $30.50 according to standard principles of technical analysis.
Wall Street ended Friday’s session mixed as investors remained concerned about escalating tensions in the Middle East. The S&P500 fell 0.22%, the Dow Jones rose 0.08%, and the Nasdaq ended the day down 0.51%. Chip stocks came under pressure on Friday on reports that the U.S. may revoke some wavers placed on tariffs for chip stocks, leading to Nvidia shares dropping 1% on Friday.
In Europe on Friday markets closed mostly higher for the session but lower across markets for the week amid escalating tensions on a global geopolitical scale. The STOXX 600 rose 0.1% on Friday, Germany’s DAX added 1.21%, the French CAC rose 0.5% and, in the UK the FTSE 100 ended the day down 0.2%.
Across Asia markets on Friday, it was a mixed session as investors assessed the potential U.S. involvement in the Middle East at the same time as China held rates steady despite its economy being in deflationary mode. Hong Kong’s Hang Seng rose 1.26%, China’s CSI index closed flat, Japan’s Nikkei fell 0.22% and South Korea’s Kospi index ended the day up 1.5%.
Locally to end the last trading week, the ASX200 posted a 0.21% loss amid growing investor uncertainty on a global scale. Utilities stocks rose 0.74% on Friday while consumer staples and discretionary stocks fell 0.87% and 0.63% respectively.
Betr rose 5.3% on Friday after lobbing an all-scrip bid for PointsBet (ASX:PBH), while Bowen Coking Coal (ASX:BCB) plummeted almost 50% after announcing the weak coal markets and the ‘unsustainable’ QLD coal royalty regime could spark the company to temporarily pause operations.
What to watch today
- On the commodities front this morning oil is trading 0.73% higher at US$74.04/barrel, gold is down just 0.05% at US$3367.91/ounce, uranium is up 1.47% at US$75.90/pound after the US attacked 3 nuclear sites in Iran, and iron ore is trading 0.06% higher at US$94.77/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.33 US cents, 94.35 Japanese Yen, 47.95 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down 0.24% after the U.S. attacked Iran over the weekend, further escalating geopolitical tensions in the Middle East.
Trading Ideas
- Bell Potter has downgraded the rating on REA Group (ASX:REA) a buy to a hold and have slightly reduced the 12-month price target on the leading online real estate platform from $267 to $262 following soft May volumes of national listings and the outlook for eased listings into FY26.
- And Trading Central has identified a bearish signal on TechnologyOne (ASX:TNE) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may fall from the close of $40.58 to the range of $36.40 to $37.20 according to standard principles of technical analysis.
Rising Middle East tensions pushed oil prices up over 10% this week, boosting local energy stocks while leaving broader markets lacking direction. Retailers continued to struggle amid soft consumer spending and delayed rate cuts, with Cettire (ASX:CTT), Accent Group (ASX:AX1) and KMD(ASX:KMD) Brands issuing cautious updates. Iron ore miners also remain under pressure as China’s mixed recovery continues to cloud the outlook.
In this week’s wrap, Grady covers:
- (0:27): the oil price surge and what it means for the market
- (1:05): volatility in the retail sector
- (2:38): pressures affecting the iron industry
- (3:58): how the market performed this week so far
- (4:43): the best and worst performing stocks and ETFs this week
- (5:15): economic news items to look out for.
Wall Street closed mixed on Wednesday after the US Federal Reserve’s latest policy update kept the US interest rate steady with Chair Jerome Powell signalling it would wait to see the impact of President Trump’s tariffs on inflation before proceeding with rate cuts. The Dow Jones fell 0.1%, the S&P 500 slipped just 0.03% and the tech-heavy Nasdaq ended the day up 0.13%.
In Europe overnight, markets in the region closed mostly lower as investors continue to monitor the latest developments in the Middle East. The STOXX 600 fell 0.34%, Germany’s DAX and the French CAC each lost 0.4% and the FTSE 100 ended the day up 0.1%.
Across the Asia region on Wednesday, markets in the region closed mixed amid escalating tensions in the Middle East. Japan’s Nikkei rose 0.9%, South Korea’s Kospi Index climbed 0.74%, Hong Kong’s Hang Seng lost 1.12% and China’s CSI index ended the day up 0.12%.
The local market’s lacklustre performance this week extended into the midweek session with the key index ending the day down 0.12% as Iran-Israel attacks entered a 5th straight day and global markets were sold off on Tuesday as a result with no end-date or macro certainty in sight.
Profit taking has hit the gold stocks yesterday with investors cashing in recent gains to capitalise on the soaring gold price which topped another record just days ago.
Retailers have done it tough lately with widespread sell-offs amid elevated promotional activity leading to margin contraction as well as downgraded guidance and weaker outlook. Lovisa tumbled 5% yesterday despite no news out of the fashion jewellery retailer.
What to watch today
- On the commodities front this morning oil is trading 0.4% higher at US$75.15/barrel, gold is down 0.36% at US$3375/ounce and iron ore is trading 0.16% lower at US$94.71/tonne.
- The Aussie dollar has strengthened against the greenback to buy 65.07 US cents, 94.34 Japanese Yen, 48.33 British Pence and 1 New Zealand dollar 8 cents.
- The SPI futures are anticipating the ASX will open the day down 0.23% extending on yesterday’s losses.
Trading ideas
- Bell Potter has downgraded the rating on Centuria Office REIT (ASX:COF) to a sell from a hold and have reduced the 12-month price target on the externally-managed REIT from $1.20 to $1.10 as the analyst feels the share price has run ahead of market conditions.
- And Trading Central has identified a bearish signal on Duratec (ASX:DUR) following the formation of a pattern over a period of 113-days which is roughly the same amount of time the share price may fall from the close of $1.36 to the range of $0.95 to $1.03 according to standard principles of technical analysis.
Wall Street closed lower across the major averages on Tuesday as tensions in the Middle East continue to rise, hitting a 5th day of attacks between Iran and Israel. The Dow Jones lost 0.7%, the S&P500 fell 0.84% and the tech-heavy Nasdaq ended the day down 0.91%.
President Trump took to Truth Social, his social media platform, demanding ‘unconditional surrender’ from Iran’s leader as he departed the G7 conference early to deal with the situation in the Middle East.
In Europe overnight, markets in the region fell as the Israel-Iran conflict continues. The STOXX 600 fell 0.8%, Germany’s DAX lost 1%, the French CAC fell 0.8% and, in the UK, the FTSE100 ended the day down 0.5%.
Across the Asia region on Tuesday markets closed mixed as investors assessed the escalating tensions in the Middle East. Lingering uncertainty and rising energy costs are weighing on global investor sentiment due to the conflict, at a time where volatility and uncertainty was already heightened due to US tariffs and global tensions rising on the trade front. Japan’s Nikkei added 0.6%, China’s CSI index closed flat, Hong Kong’s Hang Seng lost 0.34% and South Korea’s Kospi index ended the day up 0.12%.
The local market started the new trading week virtually flat with a 0.01% gain on Monday before see-sawing between positive and negative on Tuesday to close down 0.08% as investors reacted to escalating tensions in the Middle East and Trump urging for Tehran’s evacuation amid the Iran-Israel attacks. Volatility, rising geopolitical tensions and macro and market uncertainty have been the core drivers of market movements in recent times weighing on investor sentiment. Rate sensitive sectors posted gains yesterday with Tech and REIT stocks ending the day up 0.32% and 0.23% respectively while utilities stocks took the biggest hit with a 0.68% loss.
Gold miners regained some ground on Tuesday following Monday’s sell-off as investors fled to safe-haven assets again in the face of growing geopolitical tensions, while uranium miners extended their recent surge on nuclear power demand rising.
What to watch today:
- On the commodities front this morning, oil continues to climb, trading up 4.6% at US$75.06/barrel, gold is up 0.2% at US$3390/ounce and iron ore is down 0.16% at US$95.23/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.70 US cents, 93.96 Japanese Yen, 47.79 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down 0.19% tracking the global market sell off overnight.
Trading Ideas
- Bell Potter has increased the 12-month price target on IVE Group (ASX:IGL) following the company’s investor strategy session where it upgraded guidance for FY25 for underlying NPAT to come in around $50m, representing a 4.7% upgrade, driven by margin expansion.
- Trading Central has identified a bearish signal on Lendlease (ASX:LLC) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may fall from the close of $5.55 to the range of $5.20 to $5.26 according to standard principles of technical analysis.
US equities rallied overnight off the back of optimism that the Israel and Iran conflict will be contained. The Dow Jones gained 300 points or 0.75%, the S&P500 gained 0.94% and the tech- heavy Nasdaq advanced 1.52%. Following Israel’s strike on Iran on Friday, the market took comfort in the fact that this wouldn’t escalate on Monday, after Iran reportedly spoke with several countries to pressure for an immediate ceasefire.
European equities also rallied with all markets closing in the green. The German DAX and France’s CAC both up 0.8%, the FTSE100 up 0.3% and the STOXX600 index up 0.36%.Locally yesterday, the Aussie market closed flat, up just 0.01% as the energy sector rallied following the spike in oil prices amid the Israel - Iran conflict. Energy producers posted very impressive gains, including Deep Yellow (ASX:DYL) advancing over 20% yesterday, Boss Energy (ASX:BOE) up more than 17%, Paladin Energy (ASX:PDN) up over 15% and Santos (ASX:STO) up over 10%.
What to watch today:
- Our local market is set to open higher this morning, with the SPI futures suggesting a 0.06% rise at the open this morning.
- In commodities:
- Crude oil has eased, now trading 2.7% lower at US$71.00 per barrel, following Friday’s sharp 7% rally. This came after reports Iran sought to de-escalate tensions with Israel and resume nuclear negotiations. The decline followed an overnight surge to US$77.49 after Israeli strikes targeted Iran’s South Pars gas field and an oil depot near Tehra
- Meanwhile, gold is trading 1.3% lower at US$3,386 an ounce and iron ore is also in the red at US$95.23 per tonne.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on clinical stage biotech company Syntara (ASX:SNT). They’ve valued the company at $0.12 and at its current share of $0.057 this implies 110.5% share price growth in a year.
- And Trading Central have identified a bearish signal in Perpetual (ASX:PPT) indicating that the stock price may fall from the price of $17.96 to the range of $14.80 to $15.40 over 34 days according to the standard principles of technical analysis.
Escalation of attacks between Iran and Israel hit global markets on Friday.
Wall Street closed lower as investors assessed the worsening tensions in the Middle East with the S&P500 dropping1.13%, while the Dow Jones lost 1.8% and the tech heavy Nasdaq ended the day down 1.3%. Oil and defensive stocks rose on Friday amid the rising price of oil due to Middle East tensions and as investors buy into the defence sector driven by rising geopolitical tensions.
In Europe on Friday markets closed in the red after Israel launched air strikes on Iran. The STOXX 600 fell 1%, Germany’s DAX and the French CAC each lost 1.1% and, in the UK, the FTSE100 ended the day down 0.5%.
Across the Asia region on Friday markets closed mixed as investors assessed an announcement by Trump that a deal had been done with China to the effect of 55% on imports from China into the U.S. Hong Kong’s Hang Seng fell 1.11% on Friday, China’s CSI index closed flat, Japan’s Nikkei fell 0.65% and south Korea’s Kospi index rose 0.45%.
Locally on Friday, the ASX200 posted a 0.2% loss after Israel attacked Iran’s nuclear program sites in a significant escalation of tensions in the Middle East.
Luxury online fashion retailer Cettire tanked a further 20% on Friday following a 31% drop on Thursday after the company announced its second profit downgrade in less than two months, citing uncertainty around tariffs and elevated promotional activity as the drivers of the downgrades.
Gold miners jumped on Friday amid the renewed geopolitical tensions driving investor uncertainty hence leading to a flock to safe-havens, while energy stocks also soared on the 13% spike in brent oil prices amid the rising Middle East tensions.
What to watch today:
- On the commodities front this morning oil is trading 7.26% higher at US$72.98/barrel, gold is up 1.36% at US$3432/ounce and iron ore is down 0.08% at US$95.38/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.85 US cents, 93.59 Japanese Yen, 47.96 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down 0.23%.
Trading Ideas:
- Bell Potter has reduced the 12-month price target on Accent Group (ASX:AX1) from $2.60 to $2.10 and maintain a buy rating on the footwear and fashion retailer following the company providing a FY25 trading update last week including group like-for-like sales down 1% in 2H25 to date, and gross margins fell 80bps on the PCP.
- Trading Central has identified a bullish signal on New Hope Corporation (ASX:NHC) following the formation of a pattern over a period of 85-days which is roughly the same amount of time the share price may rise from the close of $3.87 to the range of $4.60 to $4.75 according to standard principles of technical analysis.
Markets were stirred this week by fresh data revealing the impact of US tariffs, with China’s exports to the US plunging and deflationary pressures deepening. While a trade deal appears imminent, uncertainty lingers. In the US, softer than expected inflation figures helped ease pressure on the Fed for the moment. Meanwhile, Japanese business sentiment slipped into the red, while back home CBA soared to a world-first record high, triggering scrutiny over the influence of Aussie super funds on local markets.
In this week’s wrap, Grady covers:
• (0:10): US-China trade talk amidst the release of economic data
• (2:42): what is driving investor sentiment in the Japanese market
• (3:48): CBA’s historic surge and its ramifications on investors
• (4:35): how the market performed this week so far
• (5:25): the best and worst performing stocks and ETFs this week
• (5:55): economic news items to look out for.
Investors weighed inflation data as the consumer price index rose 0.1% in May from April, less than the 0.2% estimate from economists were expecting. Core CPI, which strips out volatile food and energy prices, also increased 0.1%, less than expected. All three major US benchmarks closed lower. The Dow Jones lost 1.1%, the S&P500 lost 0.27%, following a 3- day winning streak, while the Nasdaq closed down 0.5%.European markets were mixed as focus remains on the US - China trade discussions, which occurred this week in London. Germany’s DAX is down 0.16%, France’s CAC down 0.36%, the FTSE100 was in the green, up 0.13%, while the STOXX600 closed 0.27% lower.
Yesterday, the Australian market gained 0.06% by the close, with real estate, energy and materials sectors leading the market’s gains. On the other end, information technology was the biggest mover, declining 1.5%, so keep watch of tech stocks today, with the Nasdaq also lower overnight
What to watch today:
- The SPI futures are suggesting that our local market will open 0.23% higher this morning, however the futures lost earlier gains this morning, following reports that the US are preparing to partially evacuate the Iraq embassy over regional security.
- In economic data, consumer inflation expectations will be out at 11:00am this morning.
- And in commodities:
- Crude oil has rallied 4.9% trading at US$68.15 per barrel, after President Donald Trump announced a preliminary trade deal with China, raising hopes for stronger energy demand. The agreement includes China supplying rare earth minerals and the US easing restrictions on Chinese students, however final approval is still pending.
- Gold has gained 1% trading at US$3,363
- And iron ore is up 0.3% at US$95.78 per tonne.
Trading ideas:
- Bell Potter have maintained their Buy rating on marketing and communications business IVE Group (ASX:IGL) and have increased their price target by 7% to $3.00 as the broker expects a positive trading update and upgrade in FY25 guidance. At the current share price of $2.66 this implies 12.8% share price growth in a year.
- And Trading Central have identified a bullish signal in ResMed (ASX:RMD) indicating that the stock price may rise from the close of $39.02 to the range of $44.50 to $45.75 over 36 days, according to the standard principles of technical analysis.
Wall St rallied on Tuesday as investors focus on the outcome of US and China trade talks which entered a second day in London. The S&P500 gained 0.55% to post a third straight winning day while the Dow Jones added 0.25% and the Nasdaq ended the day up 0.63%. Investors are hoping a stable deal can be done, with some officials saying the negotiations are ‘going well and they expect the talks to continue all day again’.
In Europe overnight, markets closed mixed as investors brace for US – China trade updates. The STOXX 600 rose 0.08%, Germany’s DAX fell 0.58%, the French CAC rose 0.17% and, in the UK, the FTSE 100 ended the day up 0.24% just shy of its previous record set.
Across the APAC region on Tuesday, markets in the region closed mixed as investors await details of the US – China trade talks. Japan’s Nikkei rose 0.32%, China’s CSI index lost 0.51%, Hong Kong’s Hang Seng closed flat and South Korea’s Kospi Index ended the day up 0.56%.
The local market started the holiday-shortened trading week with a fresh record close buoyed by strength among energy stocks amid the rising price of oil.
Progress in talks between China and the US on Monday night through a 6-hour meeting and NAB business confidence data for May out on Tuesday morning beating expectations were the key drivers of the local index posting a 0.84% gain on Tuesday. Investor sentiment is very news and noise driven right now so any positive news and outlook drives markets higher.
Yesterday, we had the release of NAB Business confidence for May released and Westpac Consumer Confidence for June released with business confidence rising 2 index points for May, well exceeding the fall to -3 index points economists were expecting, but consumer confidence rose just 0.5% which fell short of the 2.5% rise markets had expected as consumer fears remain elevated on the global trade uncertainty front.
MonashIVF (ASX:MVF) tanked over 25% yesterday after news surfaced that the company has encountered a second IVF embryo implantation incident with the wrong embryo being inserted into a patient, marking the second event of its kind to hit the headlines in a month.
Gold miners retreated on Tuesday as investor appetite for growth stocks regained momentum amid the sliding price of gold on the back of trade negotiation progress between the world’s largest economies.
What to watch today:
- The Aussie dollar has strengthened against the greenback to buy 65.19 US cents, 94.47 Japanese Yen, 48.11 British Pence and 1 New Zealand dollar and 8 cents.
- On the commodities front this morning, oil has pulled back from yesterday’s spike to trade 0.91% lower at US$64.68/barrel, gold is down 0.1% at US$3322/ounce and iron ore is down 0.6% at US$95.62/tonne.
- Ahead of Wednesday’s trading session in Australia the SPI futures are anticipating the ASX will open the day up 0.28%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Catapult Group (ASX:CAT) and maintain a hold rating on the leading sports technology company following the company’s announcement of its latest acquisition of US-based Perch for an initial consideration of US$18m. The analyst sees the acquisition will provide a large cross-sell opportunity to its existing 3600 pro teams.
- And Trading Central has identified a bullish signal on Yancoal (ASX:YAL) following the formation of a pattern over a period of 60-days which is roughly the same amount of time the share price may rise from the close of $5.51 to the range of $6.25 to $6.45 according to standard principles of technical analysis.
Wall Street closed mostly higher on Monday as investor optimism remains elevated on hopes of trade talks progress between the U.S. and China. The S&P500 rose 0.09%, the Dow Jones fell just 1.1 points and the Nasdaq ended the day up 0.31%.
In Europe overnight, markets closed lower as investors awaited the outcome of talks between the U.S. and China in London. The STOXX 600 fell 0.08%, Germany’s DAX lost 0.54%, the French CAC dropped 0.17%, and, in the UK, the FTSE100 ended the day down 0.06%.
Across the Asia markets on Monday, it was a sea of green as investors welcomed some favourable economic data out of China and awaited key trade talks between the world’s largest economies. Consumer price inflation fell by 0.1% YoY in May which was lower than the 0.2% economists were expecting, while producer price index fell by 3.3%.
China’s CSI index rose 0.3%, South Korea’s Kospi index rose 1.55%, Japan’s Nikkei added 0.92% and Hong Kong’s Hang Seng ended the day up 1.63%.
The ASX was closed on Monday for the King’s Birthday public holiday.
Last week though, the ASX posted a near 1% gain for the 5-trading days to notch the first positive trading week for June and the fourth consecutive weekly gain as progress talks between Presidents Trump and Xi resumed and ended with an in-person meeting agreement.
Gold producer Ora Banda took a hit on Friday after downgrading its gold production guidance for FY25 to 5% below the low end of the initial guidance range, while also increasing the costs expected by 4% with the driver of the update being extended downtime required for the processing plant.
What to watch today:
- Ahead of Monday’s trading session in Australia the SPI futures are anticipating the ASX will open the day down 0.06%.
- The Aussie dollar has strengthened against the greenback to buy 65.18 US cents, 94.19 Japanese yen, 47.98 British pence and 1 New Zealand dollar and 8 cents.
- On the commodities front this morning oil is trading 1.24% higher at US$65.32/barrel, gold is up 0.42% at US$3325.58/ounce and iron ore is down 0.6% at US$95.62/tonne.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Develop Global (ASX:DVP) from $4 to $5 and maintain a buy rating on the hybrid underground and owned-mine operator following the release of recent updates out of the company including Woodlawn’s plant commission and underground mine production ramp-up progressing ahead of Bell Potter’s expectations.
- And Trading Central has identified a bearish signal on REA Group (ASX:REA) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may fall from the close of $232.52 to the range of $219 to $223 according to standard principles of technical analysis.
Nuclear energy has become one of the key beneficiaries of the AI- driven spike in electricity demand from data centers. This week we saw Uranium stocks advance following Meta’s announcement of a 20-year nuclear facility agreement. Meta’s announcement follows similar nuclear power agreements from peers Microsoft, Amazon, and Google.
In this week’s wrap, Grady covers:
- (0:27): what’s driving the nuclear power surge in 2025
- (1:52): why tech giants are creating strong tailwinds for uranium producers
- (3:35): Bell Potter’s uranium stock picks
- (5:15): how the market performed this week so far
- (5:28): the best & worst performing stocks & ETFs this week
- (6:10): the most traded stocks by Bell Direct clients
- (6:38): economic news items to watch out for.
US equities closed mixed overnight. The Dow Jones dropped 0.2%, ending at four day winning streak as lower than expected payroll data dragged down sentiment. The S&P500 and the Nasdaq however, both closed in the green, gaining 0.44% and 0.32% respectively.
European markets were all in the green with the STOXX600 up 0.47%.
Our local market rallied yesterday as the energy sector lead the market with strong gains. Paladin Energy (ASX:PDN) and Mineral Resources (ASX:MIN) were among the top performers.
Uranium stocks jumped at the open following news that one of the world’s biggest technology companies had stepped up demand for nuclear power.
The rise came after Meta overnight signed a 20-year contract to buy 1,121 megawatts from Constellation’s nuclear plant, with power supply beginning in 2027. This follows similar deals struck by peers Microsoft, Amazon, and Google parent Alphabet. Nuclear power has emerged as one of the biggest winners from the AI-fuelled surge in electricity needed for data centres. New nuclear reactors are an important source of uranium demand growth. This follows Microsoft’s recent deal to fulfil all AI power needs from a US Nuclear power plant.
Also yesterday, the GSP growth rate was released. GDP grew at 0.2% in the March quarter following a 0.6% expansion in the prior quarter. Markets were expecting a 0.4% rise so the data out today indicating stalled growth.
What to watch today:
- The Australian market is set to open slightly in the red. The SPI futures are suggesting a 0.1% drop at the open this morning.
- And in commodities,
- Crude oil has dropped more than 1% and is trading at US$62.69 per barrel as Saudi Arabia signalled it may push for a large production increase, raising fears of a global oil oversupply.
- The price of gold has rebounded, advancing 0.6% trading at US$3,373.44 an ounce, and approaching a one-month high, as a series of weak US economic reports renewed concerns over the outlook.
- And iron ore has jumped more than 1% trading at US$96.26 per tonne. The price is still hovering around eight- month lows as weak economic data from China clouded the metal's demand outlook.
Trading ideas:
- Bell Potter maintain their Buy rating on Elders (ASX:ELD), a leading supplier to fertiliser, agricultural chemicals and animal health products. Their 12- month price target is unchanged at $9.10, and at ELD’s current share price of $6.15, this implies 48% share price growth in a year.
- And Trading Central has identified a bullish signal in ResMed (ASX:RMD) indicating that the stock price may rise from the close of $38.33 to the range of $40.60 - $41.20 over 10 days according to the standard principles of technical analysis.
Wall St tor on Tuesday as investors anticipate details on potential US trade deals will come to light very soon. AI stocks lead the gains with Nvidia up more than 3% at the sessions’ end. The S&P500 rose 0.58% on Tuesday, while the Nasdaq added 0.81% and the Dow Jones ended the day up 0.51%.
In Europe overnight, markets closed slightly higher after the eurozone inflation reading eased to a cooler-than-expected forecast 1.9% in May. The STOXX 600 rose 0.01%, Germany’s DAX added 0.64%, the French CAC climbed 0.33% and, in the UK, the FTSE100 ended the day up 0.13%.
Across the Asia region on Tuesday, the US Customs and Border Protection agency's move to extend a tariff pause on some Chinese goods boosted risk-on sentiment during Asian trading. This also helped the US dollar strengthen, recovering some of Monday’s sharp losses against major currencies. China’s CSI index rose 0.31% on Tuesday, Hong Kong’s Hang Seng climbed 1.4%, Japan’s Nikkei ended the day flat and South Korean markets were closed for polling day.
The Australian share market had its best day in a month, rising 0.6% as optimism about revived US-China trade talks boosted investor sentiment. The S&P/ASX 200 gained 52.6 points to close at 8466.7, with financials leading nine of 11 sectors higher. The rally followed gains on Wall Street after news that Presidents Trump and Xi will discuss tariffs this week.
Investors bought into the banks on Tuesday due to the safe-haven nature of such investments over the last year, while Iron ore miners declined in line with a drop in iron ore futures, triggered by China's manufacturing activity hitting its lowest point in over two years. BHP (ASX:BHP) fell 0.6%, while Rio Tinto (ASX:RIO) slipped 0.7%.
IDP Education (ASX:IEL) recorded the biggest loss on the market, tumbling 44.8% after warning investors that global policy uncertainty has impacted its student enrolment pipeline. The company also revealed it is conducting a review of its profitability and cost structure.
Meanwhile on a macro level, from 1st July, 2.6 million workers will benefit from a historic 3.5% minimum wage increase; the $32 weekly rise brings the national minimum wage to $24.95 per hour or approximately $948 per week. While this wage rise is one of the largest above-inflation increases ever, it is expected to have only a modest impact on inflation.
What to watch today:
- On the commodities front this morning, oil is trading 1.38% higher at US$63.38/barrel, gold is down 0.9% at US$3352/ounce and iron ore is down 0.7% at US$95.30/tonne.
- The Aussie dollar has weakened against the greenback overnight to buy 64.67 US cents, 93.03 Japanese Yen, 47.93 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session in Australia, the SPI futures are anticipating the ASX will open the day up 0.27%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Aspen Group (ASX:APZ) from $3.05 to $3.90 and maintain a buy rating on the real estate company following the company’s successful raising of $70m via an institutional placement with a further $4m to be raised via SPP at $2.90/unit.
- Trading Central has identified a bullish signal on Rural Funds Group (ASX:RFF) following the formation of a pattern over a period of 30-days which is roughly the same amount of time the share price may rise from the close of $1.79 to the range of $1.91 to $1.93 according to standard principles of technical analysis.
Wall Street started the new trading week with all three major benchmarks closing in the green, despite the tensions in global trade. The Dow Jones gained 0.08%, the S&P500 up 0.41%, while the Nasdaq gained 0.67%.
European markets closed mixed overnight as President Trump’s 50% steel tariffs inflate EU trade tensions. The STOXX600 closed 0.14% lower, the German DAX down 0.28%, France’s CAC down 0.19%, while the FTSE 100 was slightly higher up just 0.02%.
Locally on Monday the ASX200 posted a 0.24% loss to start the new trading month lower, as energy and utility stocks weighed on market gains, while only 3 of the 11 sectors ended the day in the green.
Brickworks (ASX:BKW) soared over 25% on Monday after the company announced a $14 billion merger with Washington H. Soul Pattinson (ASX:SOL), with the arrangement initially valuing BKW shares at a 10.1% premium to the previous closing price. The market’s reaction signals investors are positive about the strategic outlook for the merger and diversification the new merger offers in the building, property and diversified financials space.
What to watch today:
- The Australian market is expected to rebound, with the SPI futures suggesting a 0.82% rise at the open this morning.
- In commodities,
- Crude oil has rallied 3.67%, trading at US$63.00 per barrel, following OPEC+’s announcement of a steady production increase.
- The price of gold is also in the green, up 2.78% to US$3,380.76 an ounce
- While iron ore has dropped over 3%, trading at US$95.95 per tonne, so keep watch of companies such as Mineral Resources (ASX:MIN) or Fortescue (ASX:FMG).
Trading ideas
- Bell Potter maintains its Buy rating on Bega Cheese (ASX:BGA) as the diversified food company continues to execute against its strategy to deliver FY28 EBITDA of more than $250 million. Bell Potter’s price target remains unchanged at $7.00, and at BGA’s current share price of $5.55, this implies 26% share price growth in a year.
- And Trading Central have identified a bearish signal in Goodman Group (ASX:GMG) indicating that the stock price may fall from the close of $32.64 to the range of $26.25 to $27.50 over 29 days, according to the standard principles of technical analysis.
Wall Street closed mixed on Friday but posted strong gains across the key indices for the month of May as investors shrugged off Trump’s tariff turmoil and global trade uncertainty to send equities higher for the month. The S&P500 closed flat on Friday but gained 6.2% for the month, the Dow Jones rose 0.13% on Friday and 3.9% for the month, and the tech-heavy Nasdaq ended the day down 0.32% but posted a 9.6% surge for the month of May.
On Friday a trade deal between the U.S. and UK was reached, boosting investor optimism that more deals of this kind can be done.
Across the European region on Friday, markets closed mostly higher on the UK trade deal and as investors welcomed the potential blocking of his tariffs on certain regions.
The STOXX600 rose 0.1%, Germany’s DAX added 0.3%, the French CAC fell 0.36%, and, in the UK, the FTSE100 ended the day up 0.64%.
Across the Asia region on Friday markets closed mostly lower as the appeals court in the U.S. allowed majority of Trump’s tariffs to be re-instated. Japan’s Nikkei fell 1.22%, China’s CSI index lost 0.48%, South Korea’s Kospi index declined 0.84%, and Hong Kong’s Hang Seng ended the day down 1.2%.
Locally on Friday, the ASX200 posted a 0.3% gain despite Trump’s tariff-related volatility weighing on the key index early in the session. Investors again moved into defensive and safe-haven stocks like the banks and staples, while shifting out of riskier stocks like tech on Friday as uncertainty arose again on the tariffs front. The local market posted a second straight monthly gain for the month of May despite heightened volatility and macro uncertainty.
On Friday morning it was announced that a federal appeals court temporarily upheld many of President Trump’s tariffs on China and other countries, pausing a lower court ruling that had challenged them. This move allows the tariffs to remain in place while the court reviews the case and considers the administration's request for more time. The appeal success came not even 12-hours after a federal court announced a blockage of the tariffs amid overuse of Presidential power. This week will be an interesting time for tariffs as the appeals process unfolds, but we are no closer to clarity on exactly what tariffs are allowed to remain and the implications on our locally listed companies.
Retail sales fell by 0.1%, missing the forecasted 0.3% increase, with warmer weather contributing to reduced clothing purchases. Clothing and department store spend were the key contributors to the weaker-than-expected reading for April, while cafes and food related spend was still on the rise. Surprisingly, niche retailers like Accent Group and Universal Stores still rallied on Friday despite the retail spend figure being released.
In data out this week, Q1 2025 GDP figures are also expected to show a slowdown in growth to 0.2%, down from 0.6% in Q4 2024, primarily due to weaker household consumption. Markets are now factoring in a 73% chance of a rate cut out of the RBA when it next meets in July, up from the 59% chance expected prior to the retail sales data being released.
What to watch today:
- On the commodities front this morning, oil is trading 0.25% lower at US$60.79/barrel, gold is 0.9% lower at US$3288.58/ounce and iron ore is down 0.15% at U.S.$99.12/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.37 U.S. cents, 92.57 Japanese yen, 47.76 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Monday’s trading session here in Australia the SPI futures are anticipating the ASX will open the first trading session of June up 0.09%.
Trading ideas:
- Bell Potter has decreased the 12-month price target on IPD Group (ASX:IPG) from $4.60 to $4.10 and maintain a buy rating on the leading Australian distributor of electrical equipment and industrial digital technologies, following the company provid
The ASX200 posted a 0.73% gain so far this week (Mon – Thurs), led by the technology and energy sectors amid the rising price of oil and growing investor appetite for growth stocks.
In this week’s wrap, Grady covers:
- (0:23): the US Federal Court’s ruling against Trump’s tariffs
- (2:30): Nvidia’s earnings results signaling demand for AI
- (3:18 ): Telstra’s reaffirmed FY25 guidance
- (3:58): what the latest CPI reading means for markets
- (4:32): the best & worst performing stocks this week
- (5:20): the most traded socks & ETFs by Bell Direct clients
- (5:49): economic news items to watch out for.
US equities declined overnight with all three major benchmarks in the red. The Dow Jones declined 0.58%, the S&P500 down 0.56%, while the Nasdaq dropped 0.51%. S&P500 futures are on the rise after Nvidia posted earnings that beat expectations, its price advancing more than 4% in after-hours trading, so this may mean good news for tech investors today. Keep watch of ASX- listed AI stocks such as WiseTech (ASX:WTC), Xero (ASX:XRO) or NextDC (ASX:NXT).
European markets were also in the red, with the STOXX 600 closing 0.61% lower.
Locally yesterday, the ASX200 declined 0.13%. Financial and materials took the biggest hit, while energy and real estate were in the lead, following a rise in the consumer price index for April, which was held at 2.4% YoY. The market consensus was for it to slow to 2.3%. The RBA is looking at the data closely to ensure inflation, which is now back in the Central Bank’s target band, keeps tracking in the right direction.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a 0.15% rise at the open this morning.
- In commodities,
- Crude oil has advanced 1.43%, currently trading at US$61.94 per barrel, as investors await an OPEC+ meeting expected to decide on increasing oil output. They’ll likely approve a 411,000 barrel per day production hike for July, continuing a trend of accelerating supply growth following a similar increase planned for June.
- The price of gold is down 0.73%, trading at US$3,284.88 an ounce following the Fed’s meeting minutes revealing concerns around inflation and labour market weakness.
- While iron ore is trading steady at US$99.39 per tonne.
Trading ideas:
- Bell Potter see Telstra (ASX:TLS) shares as fully valued. They have maintained a Hold trading on TLS with an improved 12- month price target of $4.65, up 7%.
- And Trading Central have identified a bullish signal in Whitehaven Coal (ASX:WHC) indicating that the stock price may rise from the close of $5.68 to the range of $6.90 to $7.90 over 50 days, according to the standard principles of technical analysis.
Wall St closed higher on the first trading session of the holiday shortened trading week as investors welcome the delay in tariffs on the EU announced on Monday. The Dow Jones rose 1.78%, the S&P500 climbed 2.05% and the tech-heavy Nasdaq ended the day up 2.47%. Tesla shares rose 7% on Tuesday after Elon Musk said he is shifting his focus away from politics and back into his companies, while AMC’s shares soared 22% after a record-breaking domestic box official over the Memorial Day long weekend that saw $326m spent at the movies over the highest holiday weekend ever.
In Europe overnight markets closed mostly higher in the wake of tariff delays on the EU region. The STOXX 600 rose 0.33%, Germany’s DAX gained 0.83% to close at a fresh record high, the French CAC fell 0.02% and, in the UK, the FTSE100 ended the day up 0.7%.
Across the Asia region on Tuesday, markets closed mixed as investors continue to assess the global trade climate following Trump’s delay to the EU tariffs until July. Japan’s Nikkei rose 0.51%, South Korea’s Kospi Index fell 0.27%, China’s CSI index lost 0.54% and Hong Kong’s Hang Seng ended the day up 0.43%.
The local market started the week flat before rising on Tuesday as tech and the big banks buoyed the local index to a 0.56% rise at the closing bell yesterday.
Capstone Copper (ASX:CSC) led the ASX200 gains yesterday with a rise of 6.72% amid the rising price of the commodity on the back of Ivanhoe halting production at Africa’s largest copper mine due to seismic activity, pressuring supply side in a time where demand is escalating.
Floods in the Northern NSW Hunter region have already hit IAG (ASX:IAG) with the insurance provider announcing yesterday it has received around 2500 claims related to the flooding. Earlier this month, IAG said its net natural perils claims were estimated to be approximately $900m to the end of April, which is around $250m lower than the year-to-date expectation. Shares in IAG rose 0.7% yesterday.
Telstra shares rose yesterday after the telco giant reaffirmed FY25 guidance, expecting to hit the top end of free cash flow and capex targets, and launched its “Connected Future 30” strategy aiming for over 50% NPAT growth, stronger AI integration, and mid-single digit cash earnings CAGR by FY30.
What to watch today:
- On the commodities front this morning, oil is trading 1.05% lower at US$60.88/barrel, gold is down 1.36% at US$3301/ounce and iron ore is down 0.08% at US$99.81/tonne.
- The Aussie dollar has weakened against the greenback to buy 64.48 US cents, 93.03 Japanese Yen, 48.06 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.60% tracking Wall Street’s rally on Tuesday.
- We have the all-important monthly CPI reading out today locally with markets expecting the annual inflation rate to fall to 2.2% for the 12-months to April.
Trading ideas:
- Bell Potter has maintained a buy rating on Propel Funeral Partners (ASX:PFP) and have slight lowered the 12-month price target on the leading full-service funeral providers following an update including guidance that has a midpoint of around 8% miss to consensus expectations amid lower seasonality uplift in April and May. The company is well funded and has strong pricing power hence the buy rating, the downgrade in price target is simply due to the company navigating some short-term volatility.
- And Bell Potter has increased the 12-month price target on Wisetech Global (ASX:WTC) from $112.50 to $122.50 and maintain a buy rating on the leading logistics software provider following the recent acquisition announcement of e2open and a delay in the launch of Container Transport Optimisation to 1HFY26.
Wall St was closed on Monday for the Memorial Day public holiday.
In Europe on Monday, markets closed higher as investors welcomed the delay of U.S. tariffs on the region until July. The STOXX 600 rose 1%, Germany’s DAX added 1.6%, the French CAC climbed 1.2%, and, in the UK, the FTSE100 was closed for a public holiday.
Across the Asia markets to start the week, markets closed mixed as investors digested Trump’s latest tariff move on the EU. South Korea’s Kospi index jumped 2% to its highest level since 2024, while Hong Kong’s Hang Seng fell 1.35%, China’s CSI index lost 0.6% and Japan’s Nikkei ended the day up 1%.
Locally on Monday, the ASX200 closed flat as investor sentiment was once again dampened by Trump’s tariff turbulence.
The Trump rollercoaster took another loop again from Saturday to Monday. In the space of 2 days the US president announced and postponed new 50% tariffs on Europe, like he has done in recent times with China and other regions. While the step may be to prompt negotiation talks, the on-again-off-again tariffs reignited investor uncertainty on Monday which has prompted global market selloffs both late last week and locally to start the new weeks on a sour note.
Uranium miners extended their rally from Friday following Trump’s move to sign an executive order to ease the regulatory process for new nuclear reactors and enhance supply chains in attempt to ease dependence on China and Russia for uranium supplies and production. For companies like Boss Energy that has an interest in a South Texan mine, demand for Aussie uranium producers is set to rise following Trump’s latest move, which boosts the growth outlook for such stocks in the eye of investors. Boss Energy rose 7.29% on Monday while Deep Yellow soared 13.65% to start the week on a strong note.
What to watch today:
- On the commodities front this morning oil is trading 0.02% lower at US$61.52/barrel, gold is down 0.5% at US$3341/ounce and iron ore is down 0.08% at US$99.81/ounce.
- The Aussie dollar has weakened slightly against the greenback to buy 64.91 US cents, 92.68 Japanese Yen, 47.99 British pence and 1 New Zealand dollar and 8 cents.
- Ahead of Tuesday’s session on the ASX, the SPI futures are anticipating the local market will open the new trading day up 0.32%.
Trading Ideas:
- Bell Potter has initiated coverage of Region Group (ASX:RGN) with a buy rating and a 12-month price target of $2.65. The internally managed REIT and largest owner of Australian supermarket-based shopping centres has strong near-term income growth potential, underpinned by its liquidity and resilient income streams according to the analyst.
- And Trading Central has identified a bearish signal on Woolworths (ASX:WOW) following the formation of a pattern over a period of 8-days which is roughly the same amount of time the share price may fall from the close of $31.89 to the range of $29.60 to $30.10 according to standard principles of technical analysis.
Wall Street re-entered sell off mode on Friday after President Trump threatened tariffs on the EU, which on Saturday turned to reality with a 50% tariff announced on the region set to come into effect from June 1. The Dow Jones lost 0.61% on Friday, the S&P 500 fell 0.67% and the tech-heavy Nasdaq ended the day down 1%.
Apple shares fell 3% on Friday after Trump posted on Trump social that iPhones sold in the US must be made in the US and if they are not, a tariff of at least 25% must be paid by Apple.
In Europe on Friday, markets closed lower amid threats of U.S. tariffs and on the back of corporate earnings results being released in the region. The STOXX600 fell 1%, Germany’s DAX and the French CAC each lost 1.6%, and, in the UK, the FTSE100 ended the day down 0.2%.
Across the Asia region on Friday, markets closed mixed as investors digested a slew of economic data released in the region. Japan’s Nikkei rose almost half a percent, South Korea’s Kospi index closed flat, while Hong Kong’s Hang Seng and China’s CSI index also each closed flat. Japan’s core inflation rose to 3.5% in April boosted by surging rice prices and the BoJ pausing the assess tariff implications. Singapore’s inflation for the same period came in at 0.7%, slightly higher than markets were expecting.
Locally to end the last trading week, the ASX200 posted a second weekly gain as a pullback in bond yields and the outlook for further rate cuts out of the RBA boosted investor sentiment. On Friday, the ASX200 ended the session up 0.15% driven by a rally for tech and energy stocks.
Uranium stocks surged on Friday on reports Trump will sign an executive order to ease the regulatory process for new nuclear reactors and enhance supply chains in attempt to ease dependence on China and Russia for uranium supplies and production. Boss Energy rose 12.82%, Paladin Energy climbed 7.02%, and Deep Yellow ended the day up 9.13%.
What to watch today
- On the commodities front this morning, oil is trading 0.54% higher at US$61.53/barrel, gold is up 1.76% at US$3358/ounce and iron ore is down 0.08% at US$99.81/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.91 U.S. cents, 92.47 Japanese Yen, 47.97 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Monday’s trading session in Australia the SPI futures are anticipating the ASX will open the day down 0.36%.
Trading ideas
- Bell Potter has slightly lowered the 12-month price target on Duratec (ASX:DUR) from $1.95 to $1.80 and maintain a buy rating on the leading Australian infrastructure contractor following the company’s release of a trading update outlining FY25 revenue guidance and EBITDA lower than previously expected attributed to delays in project awards and weather disruptions.
- Trading Central has identified a bearish signal on APA Group (ASX:APA) following the formation of a pattern over a period of 32-days which is roughly the same amount of time the share price may fall from the close of $8.13 to the range of $7.55 to $7.65 according to standard principles of technical analysis.
Investor sentiment remains upbeat as M&A activity accelerates, commodities shift gears as the big players look to diversify earnings, and key macro trends point to a busy second half of 2025.
In this week’s wrap, Grady Wulff covers:
- (0:09) Why M&A is back on the agenda, and what’s fuelling it
- (1:01) The Insignia Financial deal twist and what’s next
- (1:51) Big mining plays: BHP’s copper push & Rio’s lithium leap
- (3:03) Mayne Pharma takeover on thin ice – what it means
- (5:30) ASX200 performance this week, sector winners & losers
- (6:16) Most traded stocks & ETFs by Bell Direct clients
- (6:42) Key economic data to watch next week.
Wall Street closed lower for a second day on Wednesday as a spike in treasury yields prompted investors to sell equities on growing fears that a new US budget bill would place even more pressure on the country’s already large deficit. The S&P500 fell 1.61%, the Nasdaq lost 1.41% and the Dow Jones ended the day down 1.91%.
Across the European region on Wednesday, markets closed mixed as hotter-than-expected inflation out of the UK and a slew of corporate earnings results weighed on investor sentiment. The STOXX 600 fell 0.3%, Germany’s DAX lost 0.2%, the French CAC slipped 0.3% and, in the UK, the FTSE100 ended the day down 0.2%. UK inflation data for April came in at a rise to 3.5%, topping expectations of a rise to 3.3%, which slashes hopes of a rate cut in the near term.
Across the Asia region on Wednesday markets closed mostly higher led by South Korea’s Kospi Index rising 0.91%, while China’s CSI index rose 0.47%, and Hong Kong’s Hang Seng gained 0.62%, but Japan’s Nikkei ended the day down 0.61%.
Locally on Wednesday, the ASX200 posted a 0.52% gain as investor optimism carried from the prior day and multiple factors boosted the local market.
Investor sentiment was driven by the RBA’s rate cut in Australia and outlook for more policy easing in months to come and, on a global scale, by China and the US making progress on the tariff negotiations front. Bond yields are also falling which drives investor appetite for equities and a rise in commodities fuelled investor appetite for materials and energy stocks yesterday so broadly it was a great day on the market.
Nine of the 11 sectors ended today’s session in the green led by energy and healthcare sectors rising around 1% each.
Mayne Pharma shares tumbled near 30% on Wednesday amid uncertainty over the Cosette takeover offer. Cosette, a US pharmaceutical giant now believes there has been a material adverse change in the company’s financial performance since the offer was first made in February including Mayne issuing weaker-than-expected earnings guidance and disclosed a potential US regulatory issue regarding its contraceptive pill.
What to watch today:
- On the commodities front this morning, oil is trading 1.33% lower at US$61.21/barrel, gold is up 0.81% at US$3317.30/ounce and iron ore is flat at US$100.05/tonne.
- The Aussie dollar has further strengthened against the greenback to buy 64.34 US cents, 92.67 Japanese Yen, 48.01 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX 200 will open the day down almost 1% tracking Wall Street’s slide overnight.
Trading ideas:
- Bell Potter has raised the 12-month price target on Catapult Group (ASX:CAT) from $4.40 to $5.00 and maintain a hold rating on the sports tracking and data technology company following the release of the company’s results yesterday including revenue and gross profits for FY25 modestly ahead of BP expectations, as well as free cash flow of US$8.6m which was a positive surprise.
- And Trading Central has identified a bearish signal on Sims (ASX:SGM) following the formation of a pattern over a period of 41-days which is roughly the same amount of time the share price may fall from the close of $15.42 to the range of $11.60 to $12.30 according to standard principles of technical analysis.
Wall Street closed lower on Tuesday as investors await clarification on the tariffs front following a strong rally in recent weeks. The S&P500 fell 0.4%, the Dow Jones lost 0.27% and the tech-heavy Nasdaq ended the day down 0.38%. The recovery rally since Trump announced negotiations were underway with China has seen the S&P500 rally more than 20% since hitting an April low, so investors have just pulled back on Tuesday in anticipation for further clarification on the tariffs front.
In Europe overnight, markets closed higher as strong corporate earnings results in the region boosted investor sentiment. The STOXX 600 rose 0.7%, Germany’s DAX gained 0.3%, the French CAC added 0.75% and, in the UK, the FTSE100 ended the day up 0.9%.
Across the Asia region on Tuesday, markets rose as investors assessed the latest rate cuts in the region including out of the RBA and the People’s Bank of China trimming the 1-year loan prime rate from 3.1% to 3% and the 5-year to 3.5%. China’s CSI index rose 0.57% on Tuesday, Hong Kong’s Hang Seng gained 1.5%, Japan’s Nikkei added 0.8% and South Korea’s Kospi index ended the day flat.The local market closed 0.6% higher yesterday as investors welcomed the RBA’s 25 basis point rate cut amid cooling inflation and escalating cost of living pressures.The RBA cut to 3.85% came despite the latest inflation reading and labour market data coming out of favour for a rate cut, however, the overall picture is positive for Australia’s economic stability in taming inflation over the long-run.
Rate sensitive sectors like tech and real estate stocks led the gains yesterday with the sectors rising 2.3% and 1.4% respectively.Technology One soared over 10% on Tuesday after the software giant increased its interim dividend by 30% on the back of strong revenue growth in the first half. Telstra shares also rallied after the telco giant said it would be raising prices, which is good for investors but not so great for customers.
What to watch today:
- On the commodities front this morning, oil is trading 0.22% lower at US$62/barrel, gold is up 2.04% at US$3288/ounce and iron ore is down 0.08% at US$100/tonne.
- The Aussie dollar has weakened against the greenback overnight to buy 64.16 US cents, 92.75 Japanese Yen, 48.22 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day up 0.62%, extending on Tuesday’s rally.
Trading ideas:
- Bell Potter has maintained a hold rating on Technology One (ASX:TNE) and have raised the 12-month price target on the software giant from $31.00 to $35.50 following the release of 1H25 results including revenue and profit before tax topping BPe and FY25 guidance was slightly below BPe. The analyst maintains a hold rating as the new price target is a modest discount to the current share price.
- And Bell Potter has initiated coverage of AML3D (ASX:AL3) with a speculative buy rating and 12-month price target of 30cps with the analyst seeing the company is at an inflection point given accelerating demand from the US defence industrial base driving material increase in system sales over the next 3-years. AML3D is a welding, metallurgical science, robotics and software business that produces automated 3D printing systems that utilise Wire Additive Manufacturing technology.
Wall Street ended the first trading session of the new week in positive territory as investors overlooked the latest moody credit rating downgrade on the U.S. on Friday, and instead favoured optimism from the trade negotiation progress with China. The S&P500 rose 0.09% to post a 6th straight winning day, while the Nasdaq climbed 0.02% and the Dow Jones ended the day up 0.32%.
The debt downgrade on Friday pushed bond yields higher early on Monday before they retreated in afternoon trade hence sending equities higher to start the week.
Over in Europe on Monday markets in the region closed mostly flat ahead of key corporate earnings results out this week. The STOXX 600 closed flat, Germany’s DAX rose 0.6% to yet another fresh record high, the French CAC fell 0.04%, and, in the UK, the FTSE 100 ended the day up 0.17%.
Across the Asia markets on Monday, it was a sea of red as investors assessed the Moody’s credit rating downgrade on the U.S. and latest slew of economic data out of China including retail sales data rising at a weaker rate than expected for April, while industrial output for the same period rose more than economists were expecting.
Hong Kong’s Hang Seng fell 0.05%, China’s CSI index lost 0.5%, Japan’s Nikkei fell 0.68% and South Korea’s Kospi index ended the day down 0.89%.
China’s retail sales for April rose 5.1% in data out yesterday which fell short of expectations of a 5.8% rise and indicates the impact of sluggish post-pandemic era and tariffs on consumer spend in the region.
Locally to start the new trading week, the ASX200 posted a 0.58% loss on Monday as a sharp selloff in energy and materials stocks weighed on the key index and investor sentiment ahead of the RBA’s rate announcement today.
What to watch today:
- The price of gold rebounded on Monday following Moody’s downgrade of the US credit rating to AA1 from AAA amid mounting concerns over US economic outlook and growing budget deficit. Gold producers including Northern Star Resources, Evolution Mining and Ramelius Resources posted gains over 1%, 3% and 2% respectively.
- On a corporate level, we saw Domino’s and Mineral Resources shares both slide yesterday after announcing respective changes at the board level, with Domino’s Chief of Australia and NZ business, Kerri Hayman, stepping down in August after 37-years with the pizza giant, while Mineral Resources announced the appointment of Malcolm Bundey as successor to outgoing chairman James McClements, who will step away from the company’s board in July.
- On the commodities front this morning, oil is trading 0.32% higher at US$62.69/barrel, gold is up 0.81% at US$3229.67/ounce, and iron ore is down 0.08% at US$100/tonne.
- The Aussie dollar has strengthened against the greenback overnight to buy 64.60 US cents, 93.53 Japanese yen, 48.30 British pence and 1 New Zealand dollar at 9 cents.
- Ahead of Tuesday’s trading session in Australia the SPI futures are anticipating the market will open the day up 0.82%.
Trading Ideas:
- Bell Potter has upgraded the rating on Paragon Care (ASX:PGC) from a hold to a buy and have a 12-month price target on the company of 52cps following the analyst seeing EPS growth in FY26 which is expected to drive all valuation metrics lower including the PE ratio to below 20x. Management are heavily invested in the long term success of the business and remain laser focused on delivery of the integration, according to the analyst.
- Trading Central has identified a bullish signal on Northern Star Resources (ASX:NST) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $18.88 to the range of $24.50 to $24.50 according to standard principles of technical analysis.
Wall Street closed higher again on Friday as investors overlooked disappointing consumer sentiment data and continued to welcome progress on the trade talk front between China and the U.S. The S&P 500 rose 0.7% on Friday and 5.3% for the week, the Nasdaq gained 0.52% on Friday and 7.2% for the week and the Dow Jones ended the day up 0.78% and rose 3.4% for the week. The latest consumer sentiment reading out on Friday showed investor sentiment fell to the second lowest Level on record in the latest reading while consumer prices are also expected to rise 7.3% over the next year, up from reported 6.5% expected last month.
Moody’s downgraded the US credit rating on Friday though from AAA to AA1 citing concerns around rising US debt.
Over in Europe on Friday, markets closed higher on Friday led by Germany’s DAX rising 0.3% to another record high close, while the STOXX 600 gained 0.4%, the French CAC rose 0.42% and, in the UK, the FTSE100 ended the day up 0.6%.
Across the Asia region on Friday, markets closed mixed as investors digested weaker-than-expected GDP data with a 0.2% contraction reported over the March quarter. Japan’s Nikkei closed flat on Friday, Hong Kong’s Hang Seng fell 0.46%, China’s CSI index fell 0.4% and South Korea’s Kospi index ended the day up 0.21%. China’s stocks were weighed down by Alibaba missing earnings expectations on Friday.
Locally on Friday, the ASX ended the week at a 3-month high after Australian economic data and global investor sentiment boosted markets to strong gains throughout the week. The ASX posted a 0.56% gain on Friday led by REIT stocks jumping 2.3%.
Stock specific news, Appen soared 18.7% on Friday after unveiling full-year revenue target of between $235m-$260m.
Uranium miners came under pressure on Friday with Boss Energy, Deep Yellow and Paladin falling over 6% each.
What to watch today:
- On the commodities front this morning oil is up 0.13% at US$62.57/barrel, gold is up 1.12% at US$3240/ounce and iron ore is down 0.34% at US$100.08/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.13 US cents, 93.04 Japanese Yen, 48.23 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day down 0.08%.
Trading ideas:
- Bell Potter has increased the 12-month price target on Temple & Webster from $15.60 to $21.00 and maintain a hold rating on the leading online homewares retailer after the company released a 2H trading update to-date with revenue growth of 18% on the PCP and EBITDA margins toward the top end of guidance. The hold rating is maintained as growth to $21.00/share is in-line with Bell Potter’s hold rating criteria.
- And Trading Central has identified a bullish signal on GR Engineering Services following the formation of a pattern over a period of 49-days which is roughly the same amount of time the share price may rise from the close of $2.82 to the range of $3.30 to $3.40 according to standard principles of technical analysis.
Investor optimism fuelled a strong start to the week following the announcement of a temporary 90-day trade agreement between the US and China. This positive sentiment propelled the ASX200 up 1.3% so far this week (Monday to Thursday), with gains in technology stocks overshadowing declines in the utilities, staples, and REIT sectors.
In this week’s wrap, Grady covers:
- (0:36): the latest update on US – China trade
- (1:41): wage price growth & jobs data out this week
- (3:13): the rally in Xero, Aristocrat Leisure, GrainCorp & Life360
- (4:45): how the ASX200 performed this week so far
- (5:24): the most traded stocks & ETFs by Bell Direct clients
- (5:51): economic news items to watch out for.
We’ve had a strong start to the week with the S&P500 and the Dow up more than 4% and 1% respectively, and the Nasdaq advancing more than 6% with investors embracing AI and mega caps. Overnight the major benchmarks closed mixed, the Dow 0.2% in the red, while the S&P500 up 0.1% and the Nasdaq up 0.7%. And the 10 year Government bond yield hit a 3 month high in the last session.
European markets were all lower with the STOXX600 down 0.24%. Locally yesterday, the ASX200 closed in the green with energy and information technology leading market gains.
What to watch today:
- Australian shares are expected to end a 6- day winning streak today, ahead of jobs data. The SPI futures are suggesting the market will drop 0.43% at the drop this morning.
- In economic data today, the unemployment rate for April will be released as well as consumer inflation expectations for May.
-
In commodities,
- Cruide oil is 1.7% lower at US$62.59 per barrel, ending a four-day rally as traders likely took profits amid a surprise rise in US crude inventories and renewed demand concerns.
- The price of gold is down more than 2% at US$3,181.98 an ounce, as easing trade tensions between the US and China continued to weigh on its safe-haven appeal.
- And iron ore is up 1.25% at US$100.75 per tonne.
Trading Ideas:
- Bell Potter have downgraded athlete tracking solutions company Catapult Group (ASX:CAT) from a Buy to a Hold and have increased their price target from $4.00 to $4.40.
- Trading Central have identified a bullish signal in Sevcorp (ASX:SRV) indicating that the stock price may rise from the close of $5.26 to the range of $5.52 to $5.58 over 28 days according to the standard principles of technical analysis.
Wall St closed mostly higher again on Tuesday as soft inflation data and progress on the trade talk front continue to boost investor sentiment. The S&P500 rose 0.72%, the Nasdaq gained 1.61% and the Dow Jones fell 0.64% as United Health declined 17% to pressure the benchmark index. US CPI data for April came in at an increase of 2.3% on an annual basis which was lower than economists’ were expecting and indicate the US inflation journey remains under control despite fears of tariffs boosting CPI.
In Europe overnight, markets in the region closed slightly higher as uncertainty over global trade outlook remains positive amid China and the US agreeing to a temporary deal. The STOXX 600 rose 0.07%, Germany’s DAX added 0.23% to close at another fresh record high, the French CAC gained 0.3%, and, in the UK, the FTSE 100 ended the day flat.
Across the Asia region on Tuesday, markets closed mixed as investor outlook beyond the 90-day US China tariff deal remains uncertain. Hong Kong’s Hang Seng fell 1.87%, China’s CSI index rose 0.15%, India’s Nifty 50 fell 1.27% and Japan’s Nikkei ended the day down 1.43%.
The local market hit an 11-week high yesterday, ending Tuesday’s session up 0.43%, taking lead from the global market rally on Monday as investors welcomed the latest deal tariff between China and the US.
With the outlook for lower tariffs on imports into the US from China and vice versa, investors regained appetite for risk and growth stocks, while investors sold out of safe-haven assets like the banks and gold.
Mining giants recovered yesterday with the rising price of oil and iron ore fuelling investor appetite for BHP (ASX:BHP), Woodside (ASX:WDS), Rio (ASX:RIO) and Santos (ASX:STO).
Location tracking tech giant Life 360 (ASX:360) soared over 10% yesterday after releasing record Q1 results including a 33% increase in total subscription revenue to US$81.9m, a 32% increase in total revenue to US$103.6m and positive operating cash flow of US$12.1m, up 13% YoY, and the company ended the quarter with cash, cash equivalents and restricted cash of US$170.4m.
What to watch today
- On the commodities front this morning oil is trading 2.76% higher at US$63.66/barrel, gold is up 0.41% at US$3249/ounce and iron ore is up 1.22% at US$99.75/tonne.
- The Aussie dollar has strengthened against the greenback overnight to buy 64.76 US cents, 95.50 Japanese Yen, 48.69 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.22%.
Before the bell this morning CBA (ASX:CBA) released its Q3 trading update including cash profit for the quarter of $2.6bn which is flat on 1H25 quarterly average and up 6% on the PCP, while operating income rose 1% and operating expenses also rose 1%. Net interest income for the big bank rose 1% while the net interest margin was stable.
Trading ideas:
- Bell Potter has increased the 12-month price target on JB Hi-Fi (ASX:JBH) following the release of the company’s Q3 trading update including sales up 6% on the PCP, while outlook for Q4 remains strong and the company remains as one of the most productive retailers globally.
- And Trading Central has identified a bullish signal on AMP (ASX:AMP) following the formation of a pattern over a period of 50-days which is roughly the same amount of time the share price may rise from the close of $1.32 to the range of $1.56 to $1.62 according to standard principles of technical analysis.
Wall Street started the new trading week significantly higher as investors welcomed the temporary progress in trade talks between China and the US. The Dow Jones rose 2.81%, the S&P500 climbed 3.26% and the tech-heavy Nasdaq ended the day up 4.35%. Shares in companies that rely on production and supply chain elements from China like Tesla, Apple and Nvidia had investors buying in on Monday with each rising over 5%.
The latest update from the China and US trade talks is that both nations have agreed to cut their respective tariffs on one another for 90-days, with tariffs on Chinese imported goods into the US to be 30% and tariffs on US good into China to be 10% for the period.
In Europe overnight, markets also closed higher in the region as global investors welcomed progress on the global trade front. The STOXX 600 rose 1.1%, Germany’s DAX climbed 0.2% to another fresh record high, the French CAC added 1.4% and, in the UK, the FTSE100 ended the day up 0.6%.
Across the APAC region on Monday, markets rallied after the US and China temporary trade deal was unveiled. Hong Kong’s Hang Seng rose 2.98%, China’s CSI index climbed 1.16%, India’s Nifty 50 gained 3.5%, and Japan’s Nikkei ended the day up 0.38%.
Locally to start the week, the ASX200 posted a 0.03% rise to start the new trading week as weakness among pharmaceutical stocks weighed on strong gains for the big miners amid progress in talks between China and the US.
Trump’s latest pharmaceutical tariff announcement hit locally listed healthcare providers hard this week with Botanix, Neuren, Telix and Clarity all dropping over 5% on Monday. Trump’s latest move in the healthcare space is that he wants to cut the price of prescription drugs which will in-turn hurt the margins made by any pharmaceutical producer selling their treatments in the US.
As progress talks between the US and China continue to make headway, safe-haven stocks were on the chopping block yesterday as market uncertainty begins to ease. Gold stocks retreated with Evolution Mining, Northern Star Resources and Genesis Minerals each fell over 3%.
What to watch today:
- On the commodities front this morning oil is trading 1.61% higher at US$62/barrel, gold is down 2.65% at US$3236/ounce and iron ore is up 1.22% at US$99.75/tonne.
- The Aussie dollar has weakened against the greenback overnight to buy 63.70 US cents, 94.53 Japanese Yen, 48.57 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 1.17% tracking global market strength overnight.
Trading Ideas:
- Bell Potter has raised the 12-month price target on REA Group (ASX:REA) from $264 to $267 and maintain a buy rating on the leading online real estate platform following the release of the company’s Q3 update including double-digit revenue growth, and strong yield growth which is set to continue amid the rate cut outlook.
- Trading Central has identified a bearish signal on Technology One (ASX:TNE) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may fall from the close of $31.62 to the range of $23.25 to $24.75 according to standard principles of technical analysis.
Wall St had a negative end to the week last week as investors awaited clarity on US-China trade talks and the Fed held the US cash rate steady amid outlook for tariff implications sparking an inflationary rebound in the world’s largest economy. The Dow Jones fell 0.3%, the S&P500 lost 0.07% and the tech-heavy Nasdaq ended the day flat.
This morning, Trump has declared great progress after high-level trade talks began with China over the weekend, with the US president claiming the meeting as a ‘total reset’ in the trade war which positions the markets for a strong start to the new trading week.
In Europe on Friday, markets closed higher as investors hold high hopes of a positive outcome from the US and China’s trade negotiations. The STOXX 600 rose 0.44%, Germany’s DAX closed at a record high up 0.63%, the French CAC rose 0.64% and, in the UK, the FTSE 100 ended the day up 0.3%.
Across the Asia region on Friday, markets closed mixed as investors digested the latest economic data out of China and awaited key trade talks between the US and China over the weekend. Japan’s Nikkei rose 1.56% on Friday, China’s CSI index fell 0.17%, Hong Kong’s Hang Seng climbed 0.4% and South Korea’s Kospi index ended the day up 0.09%.
Locally to end the week, the ASX 200 ended the week with a positive session on Friday as the key index rose 0.48% boosted by a strong tech and financial rally, but for the week the ASX 200 posted a slight decline of 0.08%. Healthcare stocks took the biggest hit over the last 5-trading days as investors fled the sector over concerns of Trump’s pharmaceuticals tariffs set to be rolled out over the coming weeks.
Liontown Resources soared 195 on Friday after the lithium producer released 2-key trading updates this week that were well received by investors, despite the spot price of lithium carbonate sinking to a four-year low this week.
And Chrysos Corporation soared almost 18% on Friday after signing an agreement with gold production giant Newmont Corporation that will see Chrysos’ PhotonAssay technology used for Newmont’s gold mining projects.
What to watch today:
- On the commodities front this morning, oil is trading 0.67% higher at US$61.43/barrel, gold is down 1.3% at US$3282/ounce and iron ore is up 0.33% at US$98.55/tonne.
- The Aussie dollar has strengthened against the greenback to buy 64.29 US cents, 93.79 Japanese Yen, 48.57 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of the first trading session of the new week, the SPI futures are anticipating the ASX will open the day up 0.19% amid positive sentiment from progress on the global trade war front.
Trading Ideas:
- Bell Potter has increased the rating on Catalyst Metals from a hold to a buy and have raised the 12-month price target on the gold producer following the acquisition of the Old Highway gold project for $32.5m cash from Sandfire Resources. With 2.1 million tonnes at 3g/t containing 206koz gold, and a higher-grade underground component, the project adds significant upside to Catalysts’ portfolio and value.
- Trading Central has identified a bullish signal on Super Retail Group following the formation of a pattern over a period of 45-days which is roughly the same amount of time the share price may rise from the close of $14.14 to the range of $15.10 to $15.40 according to standard principles of technical analysis.
This week, Grady examines the key drivers of market activity: the latest quarterly updates, ongoing global trade tensions, and the trajectory of China’s economic recovery. Plus, hear insights from Bell Potter healthcare analyst John Hester, who yesterday discussed the potential impact of pending pharmaceutical tariffs on Australian listed healthcare companies.
In this week’s wrap, Grady covers:
- (0:32): why WiseTech (ASX:WTC) declined on Tuesday
- (1:00): exclusive addition - Bell Potter’s view on Trump’s healthcare tariffs
- (3:48): Westpac (ASX:WBC) & NAB (ASX:NAB) 1H results
- (4:33): the latest on the US – China trade talks
- (5:56): how the ASX200 performed this week so far
- (6:28): the most traded stocks & ETFs by Bell Direct clients
- (6:56): economic news items to watch out for.
US equities all closed higher overnight after a volatile session as the Federal Reserve signalled that the risks for an economic slowdown and higher prices are increasing. The Dow Jones gained 0.7%, boosted by a nearly 11% jump in Disney shares following their fiscal second quarter report which saw a surprising increase in subscriber numbers. The S&P500 gained 0.43% while the Nasdaq gained 0.27%.
Additionally, the Federal Open Market Committee held its held its benchmark overnight borrowing rate in a range between 4.25% to 4.5%, where it has been since December. Rates were held steady, with officials adopting a wait-and-see approach amid growing fears of economic stagnation fuelled by President Trump’s tariffs.
European markets all closed in the red with corporate earnings the main focus for investors. The STOXX600 closed 0.5% lower.
Locally yesterday, the ASX200 gained 0.33% with energy and real estate in the lead, while healthcare and tech were the only two sectors to close in the red.
What to watch today:
- The SPI futures are suggesting our local market will rise slightly, up 0.1% at the open this morning.
- In commodities,
- Crude oil is trading almost 2% lower at US$57.93 per barrel, hovering near four-year lows due to muted optimism ahead of upcoming U.S.-China trade talks. The Federal Reserve held interest rates steady, as officials adopt the wait-and-see approach on tariffs.
- The price of gold is 1.07% lower at US$3,364.21 an ounce with the rising risks of both inflation and unemployment, reinforcing a cautious stance on future rate adjustments.
- And iron ore is up 0.7% at US$99.33 per tonne.
Trading Ideas:
- Bell Potter maintain a BUY rating on Bega Cheese (ASX:BGA) with a 12- month price target of $7.00. At BGA’s current share price of $5.93, this implies 18% share price growth in a year.
- And Trading Central have identified a bullish signal in New Hope Corporation (ASX:NHC) indicating that the stock price may rise from the close of $3.75 to the range of $4.21 - 4.31 over 33 days according to the standard principles of technical analysis.
In the US on Tuesday, Wall St continued its sell-off as investors await further clarity on the global trade and tariff front. The Dow Jones fell 0.95%, the S&P500 lost 0.77% and the tech-heavy Nasdaq ended the day down 0.87%. Tesla shares came off 1.8% on Tuesday after the company’s new car sales in Britain and Germany fell to their lowest in more than two years last month despite growing consumer demand for electric vehicles.
In Europe overnight, markets in the region closed mostly lower as investors continue to monitor corporate earnings results and uncertainty around the US trade outlook. The STOXX 600 fell 0.18%, Germany’s DAX lost 0.4%, the French CAC fell 0.4% and, in the UK, the FTSE100 ended the day up just 0.01%.
Across Asia on Tuesday, markets closed mixed as investors in the region continue to assess the unfolding trade situation between the US and key trade partners like China. China’s CSI index rose 1.01%, Hong Kong’s Hang Seng added 0.7%, India’s Nifty 50 fell 0.3%, and Japan’s Nikkei was closed for a public holiday.
The local market started the new trading week with a sell-off that ended a 7-day winning streak for the ASX200 after key trading updates and uncertainty around tariffs and trade deals weighed on investor sentiment. On Tuesday the key index ended the day down 0.1% as healthcare and the banking stocks weighed on the key index.
An increasing amount of locally listed companies have been updating the market with tariff implication expectations and unclear outlook notes that have increased investor panic in recent days. Wisetech Global (ASX:WTC) fell over 2.5% after warning of potential demand risks from tariffs as the latest company to report uncertain outlook.
Tabcorp (ASX:TAH) bucked the volatility yesterday with a rise of 9% after the gaming and wagering company announced the wagering market remains strong with a modest improvement to the turnover trend in the wagering market, indicating consumer demand remains strong despite broader volatility.
What to watch today:
- On the commodities front this morning oil has rebounded to trade 3.3% higher at US$59/barrel, gold is up 2.46% at US$3416/ounce and iron ore is down 0.8% at US$97.41/tonne.
- The Aussie dollar has further strengthened against the greenback to buy 64.94 US cents, 92.51 Japanese Yen, 48.33 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.38% tracking Wall Street’s losses overnight.
Trading Ideas:
- Bell Potter has downgraded the rating on Platinum Asset Management (ASX:PTM) from a hold to a sell after the funds manager released April’s results including FUM falling $629m or 6.1% to $9.647bn.
- And Trading Central has identified a bearish signal on Lovisa (ASX:LOV) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may fall from the close of $24.85 to the range of $19 - $20 according to standard principles of technical analysis.
Wall St started the new trading week lower, with the S&P500 snapping a 9-day winning streak as investors continue to monitor the latest global trade developments. The S&P500 fell 0.64%, the Nasdaq lost 0.74% and the Dow Jones ended the day down 0.24%. Sentiment slightly rose after a report outlined that India has proposed zero tariffs on steel, auto components and pharmaceuticals, while investors still remain cautious about the timeline and exact scope of tariff agreements between the US and key trade partners.
In Europe overnight markets in the region closed mixed as investors look ahead to key economic data out in the region. The STOXX 600 rose 0.16%, Germany’s DAX climbed 1.1%, the French CAC fell 0.55% and, in the UK, the FTSE 100 was closed for a holiday.
Across the Asia region on Monday, markets rose after China said it was evaluating possible trade talks with the US as the ongoing tariff war continues to unfold. China’s markets were closed for a public holiday while Hong Kong’s Hang Seng rose 1.74%, Japan’s Nikkei added 1.04%, India’s Nifty 50 climbed 0.21% and South Korea’s Kospi Index ended the day up 0.12%.
Locally to start the new week, the ASX200 fell 1% to snap a 7-day winning streak as weaker-than-expected results out of Westpac weighed on the financial sector and dented overall investor sentiment.
Westpac (ASX:WBC) kicked off the results release for the big banks with first half profit sliding 1% on 1H24 amid rising geopolitical risks and a highly competitive mortgage market. The bank’s net interest margin, where most of profits are made, also fell 1bps to 1.88%. On release of the results WBC shares fell over 2% while all big bank stocks also retreated on Monday.
Gold Road Resources (ASX:GOR) climbed almost 10% on Monday after coming out of a trading halt and addressing speculation it had received a takeover and entered into a takeover offer with Gruyere Holdings to acquire 100% of issued and outstanding shares in Gold Road by way of a scheme of arrangement valuing Gold Road at around $3.7bn.
What to watch today:
- On the commodities front this morning, oil is trading 1.88% lower at US$57.19/barrel, gold is up 2.87% at US$3332/ounce and iron ore is down 0.8% at US$97.41/tonne.
- The Aussie dollar has further strengthened against the greenback to buy 64.66 US cents, 92.94 Japanese Yen, 48.76 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day down 0.26% extending on yesterday’s losses.
Trading Ideas:
- Bell Potter has reduced the 12-month price target on Chrysos Corporation (ASX:C79) from $4.70 to $4.40 and maintain a hold rating on the global mining assay service provider following the release of the company’s May 2025 trading update including revenue beating BPe for the latest quarter, and 5 units being deployed with revenues expected to start generating from these units by the end of FY25. The slight downgrade of the price target is due to recent contract wins outpacing deployment and revenue tracking at the lower end of the guidance range.
- And Trading Central has identified a bullish signal on Light & Wonder (ASX:LNW) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may rise from the close of $142.03 to the range of $156 to $160 according to standard principles of technical analysis.
Wall St ended the last trading week on a high after better-than-expected nonfarm payrolls data for April eased recession fears and lifted the S&P500 to its longest winning streak in over 2-decades. The S&P500 gained 1.5% on Friday, the Dow Jones rose 1.4% and the Nasdaq ended the day up 1.51%. Payrolls in the US grew by 177,000 in April, well above the 133,000 economists were expecting in a sign the labour market remains strong despite recession fears amid the Trump tariff turmoil.
Across the European region on Friday, markets closed higher on better-than-expected economic data and on trade war de-escalation between China and the US. The STOXX 600 rose 1.7%, Germany’s DAX added 2.62%, France’s CAC rose 2.33% and, in the UK, the FTSE100 ended the day up 1.17%.
Asia markets ended the week in the green as trade talks between China and the US continue to make progress. Hong Kong’s Hang Seng rose 1.74%, India’s Nifty 50 rose 0.21%, Japan’s Nikkei added 1.04%, and South Korea’s Kospi Index ended the day up 0.12%.
Locally on Friday, the ASX200 ended the week on a high a gain of 1.1% boosted by strength among tech stocks following a strong night for the Nasdaq on Thursday night despite gloomy earnings out of Amazon, Block and Apple.
Corporate Travel Management (ASX:CTD) tumbled 9.2% on Friday after saying it expects to report lower revenue and earnings growth due to the initial impact of tariffs on client demand, while Block sank 25.9% after the digital payments provider lowered its full year guidance.
What to watch today:
- On the commodities front this morning, oil is trading 3.6% lower at US$56.24/barrel, gold is up 0.14% at US$3244/ounce and iron ore is down 1.07% at US$98.19/tonne.
- The Aussie dollar has further strengthened against the greenback to buy 64.53 US cents, 93.38 Japanese Yen, 48.56 British Pence, and 1 New Zealand dollar and 8 cents.
- Ahead of Monday’s trading session, the SPI futures are anticipating the ASX will open the day up 0.4% to extend on last week’s gains.
Trading Ideas:
- Bell Potter has raised the 12-month price target on Woolworths Group (ASX:WOW) from $30.75 to $31.85 and maintain a hold rating on the supermarket giant following the release of the company’s Q3 results including 3.2% YoY sales growth on a group level, while Australian food revenues rose 3.6% and Australian B2B business revenues rose 6.4%. NZ food sales rose just 1.8% YoY and W Living sales fell 2.6% YoY. The reason for the maintenance of the hold rating is that Woolworths is currently trading on a multiple consistent to Coles and the analyst feels it is difficult to see the catalyst to return the rating to a premium compared to Coles at present.
- And Bell Potter has reduced the rating on SGH (ASX:SGH) from a buy to a hold and have reduced the 12-month price target on the company from $57 to $54.50 following a mixed outlook in the company’s operating divisions. While equipment orders are lifting, aggregate prices are falling and the construction market remains flat in recent months. Trading on a 20.3x FY26 PE, the analyst believes SGH is currently fairly valued.
Markets welcomed some positive news this week on the Trump Tariff front with a reduction in the US automotive tariff announced and news that a major trade deal will soon be announced with China.
In this week’s wrap, Grady covers:
- (0:21): how tariff concerns impacted imports of foreign goods
- (1:32): consumer sentiment data out this week
- (1:57): an update on China’s post-pandemic recovery
- (3:15): Australia’s underlying inflation figures
- (4:36): how the ASX200 performed this week so far
- (5:29): the most traded stocks & ETFs by Bell Direct clients
- (5:52): economic news items to watch out for.
Wall St closed mixed on Wednesday following the release of US GDP data for Q1 that indicated economic contraction of 0.3% QoQ which is well below the 2.4% expansion reported in Q4 and below economists’ expectations of a 0.5% rise in GDP for the latest reading. The slide in GDP enhanced investor fears of a US recession which impacted equities on Wednesday. The Dow Jones rose 0.35%, and the S&P500 gained 0.15% but the Nasdaq ended the day down 0.09%. Consumer confidence, JOLTs Job Openings and the personal spending index all in the US were also released for the latest period overnight with each coming in poorer than economists’ were expecting.
European markets closed higher on Wednesday as investors reacted to worse-than-expected economic data out of the US. The STOXX 600 rose 0.46%, Germany’s DAX gained 0.32%, the French CAC added 0.32% and, in the UK, the FTSE100 ended the day up 0.37%
Asia Markets closed mixed on Wednesday as investors digested an array of key economic data out in the region and ahead of the Bank of Japan’s rate meeting kicking off. Japan’s Nikkei rose 0.57%, Hong Kong’s Hang Seng gained 0.51%, and China’s CSI index fell 0.12% after China’s manufacturing activity dropped more than expected in April to enter contraction territory.
Locally on Wednesday, the ASX extended its rally into the midweek session with a gain of 0.7% taking lead from Wall Street’s strength on Tuesday. Real estate stocks led the gains on Wednesday while other rate sensitive sectors like Tech and consumer discretionary stocks posted notable gains.
Australia’s latest inflation reading for the March Quarter was released yesterday with monthly inflation rising 0.9% while the annual rate remained at 2.4%. Trimmed mean inflation fell to 2.8% in the quarter which is now back within the RBA’s target 2-3% range. Markets are expecting a 62% chance of a rate cut to be announced at the next RBA meeting in May prior to the CPI reading release yesterday.
Gold producer Northern Star Resources (ASX:NST) extended its sell-off yesterday after the gold giant lowered its output guidance for FY25, while Ora Banda (ASX:OBM) also tumbled over 6% after also lowering full-year production guidance.
What to watch today:
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX will open the first session of the new trading month down 0.34% following Wall Street’s turbulence overnight.
- On the commodities front this morning oil is trading 3.42% lower at US$58.35/barrel, gold is down 1.13% at US$3279/ounce and iron ore is down 0.1% at US$99.76/tonne.
- The Aussie dollar has strengthened against the greenback overnight to buy 64.08 US cents, 91.62 Japanese Yen, 47.61 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on Regis Resources (ASX:RRL) from a buy to a hold and have raised the 12-month price target to $4.57 on the gold producer following the release of the company’s March quarter report which beat BPe on production and costs. The downgrade to a hold is simply due to recent share price appreciation.
- Trading Central has identified a bullish signal on Autosports Group (ASX:ASG) following the formation of a pattern over a period of 97-days which is roughly the same amount of time the share price may rise from the close of $1.94 to the range of $2.11 to $2.17 according to standard principles of technical analysis.
The recent rally on Wall St extended into Tuesday’s session as investor optimism was boosted by the White House saying a major trade deal is close to being announced. The S&P500 rose 0.58% to notch a 6th straight winning session, while the Dow Jones rallied 0.75% to also post a 6th straight winning day, and the Nasdaq ended the day up 0.55%.
In Europe overnight, it was a sea of green as investors responded to corporate results out in the region including Lufthansa posting a revenue beat, Deutsche Bank reporting a 39% rise in first-quarter profit and HSBC topping profit expectations. The STOXX 600 rose 0.4%, Germany’s DAX added 0.1%, the French CAC gained 0.8% and, in the UK, the FTSE100 ended the day up 0.6%.
Across the Asia region on Tuesday, markets closed mixed as investors assessed corporate earnings results and Trump’s move to reduce automotive tariffs. China’s CSI index ended down 0.17%, while Hong Kong’s Hang Seng rose 0.16% and South Korea’s Kospi index ended the day with a gain of 0.65%.
The local market started the new trading week in positive territory with the ASX200 hitting a 2-month high to end Tuesday’s session up 0.9%. Trump’s tariff concerns remain in the background of investor concerns right now but are being overlooked ahead of the all-important local inflation reading out today and ahead of the RBA’s anticipated rate cut to come in May. Yesterday we had further clarity out of the US that negotiation talks on tariffs between China and the US are progressing and Trump reduced the tariff he recently imposed on automotive sales.
The recent uranium stock rally extended yesterday as the price of the commodity rose 0.6% to US$67/pound, but more of the gains can be explained by Boss Energy’s (ASX:BOE) driving force after the uranium producer reported its first quarter of free cash flow generation and that output and costs had met or beat expectations. Boss Energy rose over 14% on Tuesday, Deep Yellow (ASX:DYL) gained 11.71%% and Paladin Energy (ASX:PDN) ended the day up 8.5%.
Elsewhere in the mining space, Mineral Resources (ASX:MIN) surged over 12% on Tuesday despite releasing a quarterly update including iron ore output guidance slashed again and the company burnt through $300m of cash in the quarter.
What to watch today
- On the commodities front:
- Oil is down 2.64% at US$60.41/barrel, gold is down 0.6% at US$3317.80/ounce and iron ore is flat at US$99.91/tonne.
- The Aussie dollar is buying 63.86 US cents, 90.90 Japanese Yen, 47.86 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.35% tracking global market gains overnight.
- Also today we will receive the latest March quarter inflation reading with the market forecasting an uptick of 0.8% in the reading, which will indicate inflation continues to ease and provides the RBA with further support for a rate cut at the next meeting in May.
Trading Ideas
- Bell Potter has downgraded the rating on Catalyst Metals (ASX:CYL) from a buy to a hold and have raised the 12-month price target on the gold production and development company following the release of the company’s Q3 results including total gold production of 24.3koz at AISC of A$2765/ounce. With growth on the horizon, the downgrade to a hold is simply on the grounds of current valuation of the company being within the Bell Potter hold criteria.
- And Trading Central has identified a bullish signal on Perenti (ASX:PRN)following the formation of a pattern over a period of 40-days which is roughly the same amount of time the share price may rise from the close of $1.38 to the range of $1.58 to $1.62 according to standard principles of technical analysis.
US equities closed missed overnight, with the Dow Jones up 0.28%, the S&P500 up 0.06% and the Nasdaq slightly lower just 0.1%. S&P500 futures are pointing lower this morning, after the index posted five straight winning sessions. Investors are preparing for earnings week, with approximately a third of S&P500- listed firms posting results.
European markets were all higher with the FTSE 100 posting its best winning streak in over 5 years.
Yesterday our local market advanced 0.36% with 10 of the 11 industry sectors in the green. Energy and technology advanced the most, while materials was the only sector to close lower. Iluka Resources (ASX:ILU) lead the market rally, while healthcare companies Clarity Pharmaceuticals (ASX:CU6) and Telix Pharmaceuticals (ASX:TLX) declined the most.
What to watch today
- The Australian market is set to open higher this morning, with the SPI futures suggesting a 0.21% rise at the open this morning.
- In commodities,
- Crude oil is trading 1.57% lower at around US$62.00 per barrel, as tariff- driven growth concerns threatened to dampen fuel consumption, while supply surged. OPEC+ surprised markets by adding approximately 411,000 barrels per day in May, reversing much of last year’s cutbacks.
- The gold price is up 0.57% at US$3,338.85 an ounce, boosted by bargain hunting and cautious sentiment ahead of key US economic data, as well as US- China trade developments.
- And iron ore is currently steady at US$99.91 per tonne.
Trading Ideas
- Bell Potter maintains a Buy rating on mining contractor and operator Develop Global (ASX:DVP). Their price target remains unchanged at $4.00 and at DVP’s current share price of $2.71 this implies 48% share price growth in a year.
- And Trading Central have identified a bearish signal in Lendlease Group (ASX:LLC) indicating that the stock price may fall from the close of $5.08 to the range of $4.05 - $4.25 over 18 days, according to the standard principles of technical analysis.
Wall St closed higher on Friday as investors continue to navigate the evolving situation on a global trade front while the big tech names got a welcome boost following a sell-off in recent times. The S&P500 rose 0.74% on Friday for a fourth straight winning session while the Nasdaq gained 1.26% and the Dow Jones ended the day up 0.05%.
Over in Europe on Friday, markets closed higher as earnings reports out in the region were well-received by investors despite ongoing trade uncertainty. The STOXX 600 rose 0.35%, Germany’s DAX added 0.8%, the French CAC added 0.45%, and in the UK, the FTSE100 ended the day up 0.1%.
Across the Asia region to end the week markets closed mostly higher as investors continue to assess the possibility of easing trade war tensions between China and the US. Hong Kong’s Hang Seng rose 0.24%, China’s CSI index closed flat, Japan’s Nikkei rose 1.9% and South Korea’s Kospi index ended the day up 0.95%.
Locally on Thursday the ASX200 rose 0.6% to end the holiday shortened trading week up 2.3% as investor optimism around a rate cut out of the RBA in May boosted investor sentiment. While Trump’s tariff moves continue to weigh on investor sentiment, we are seeing certain companies rally from exemptions like ResMed (ASX:RMD) soaring 8.5% on Thursday after revealing its sleep apnoea devices have received an exemption from Trump’s tariffs.
Uranium miners also rallied on Thursday with Paladin Energy (ASX:PDN) jumping 12% after announcing record production at its Langer Heinrich mine in Namibia.
What to watch today
- Ahead of Monday’s trading session in Australia the SPI futures are anticipating the ASX will open the day just 0.02% higher.
- On the commodities front this morning oil is trading 0.71% higher at US$63.44/barrel, gold is down 0.26% at US$3311/ounce and iron ore is down 0.06% at US$99.92/tonne.
- The Aussie dollar has further strengthened against the greenback to buy US$0.64, 91.93 Japanese Yen, 48.10 British Pence and NZ$1.07.
Trading Ideas
- Bell Potter has slightly reduced the 12-month price target on Seek (ASX:SEK) from $27.00 to $25.80 and maintain a buy rating on Australia’s leading online jobs advertisement platform following a mixed month of jobs report for March. For the month, Seek’s employment report for Australia outlined an accelerating decline for job ads, down 12.8% YoY on platform and the ABS’ internet job ad vacancy index also worsened for March, down 16.3%. Despite the weakness in the ABS data, Seek is significantly outperforming ABS data.
- And Trading Central has identified a bullish signal on Autosports Group (ASX:ASG) following the formation of a pattern over a period of 55-days which is roughly the same amount of time the share price may rise from the close of $1.83 to the range of $2.00 to $2.06 according to standard principles of technical analysis.
European markets rallied on hopes of cooling US – China trade tensions. The STOXX 600 gained 1.78%, German’s DAX gained more than 3%, France’s CAC up more than 2% and the FTSE 100 up 0.9%.
The three major US benchmarks were also all higher, posting back-to-back gains. The Dow Jones advanced 1.07% or 63 points, the S&P500 up 1.67%, while the tech- heavy Nasdaq advanced 2.5%.
What to watch today
- The SPI futures are suggesting the Australian market will rise 0.16% at the open this morning.
- Looking at commodities,
- Crude oil has declined 2.24% to US$62.24 per barrel, amid the possibility that OPEC+ may continue to increase supply in upcoming months.
- The price of gold is trading 0.69% lower at US$3,313.40 an once, after hitting a record of US$3,500 the prior session and contrasting with the rally in other dollar- denominated financial assets that benefited from expectations of a de-escalation in the China and US trade tensions.
- While iron ore is trading higher, up 0.21% at US$100.09 per tonne.
Trading Ideas
- Bell Potter maintains a Buy rating on Telix Pharmaceuticals (ASX:TLX) following a strong quarter of revenue growth. Their 12-month price target remains unchanged at $36.00 and at TLX’s current share price of $25.18, this implies 43% share price growth in a year.
And Trading Central have identified a bullish signal in Regis Healthcare (ASX:REG) indicating that the stock price may rise from the close of $6.75 to the range of $7.70 to $7.75 over 30 days, according to the standard principles of technical analysis.
European markets closed higher after the European Central Bank reported that the disinflation process in Europe was “nearing completion.” The STOXX 600 closed 0.25% higher, the German DAX up 0.4%, France’s CAC up 0.56% and the FTSE 100 up 0.6%.
US equities rallied on Wall Street overnight, ending a four- day streak of losses, as hope that trade tensions between the US and China could potentially ease soon. The Dow Jones advanced 2.66%, the S&P500 up 2.51% and the Nasdaq up 2.7%.
Yesterday the ASX200 closed slightly lower, just 0.03%, with what was a quieter trading day to start the three-day working week between Easter and Anzac Day long weekends. Financials, consumer staples and materials were the only sectors to close in the green.
West African Resources (ASX:WAF) and Evolution Mining (ASX:EVN) lead the gains, while Paladin Energy (ASX:PDN) and Zip Co. (ASX:ZIP) declined the most.
What to watch today:
- Following US equities, the Aussie market is set up to jump 1.28% at the open this morning, according to the SPI futures.
- In economic data today, the S&P Global Manufacturing and Services Flash PMI will be released, a forward looking estimate of the final PMI out next week.
- In commodities,
- Crude Oil recovered earlier losses, trading over 3% higher at US$64.36 per barrel, likely in a technical rebound after falling over 2% in the previous session. With that in mind, the outlook for crude is bearish as progress in discussions between the US and Iran has increased the possibility of a deal to bring Iranian oil exports back to the market.
- The price of gold has declined, down more than 3%, trading at US$3,327.97 an ounce, after having touched a new record of US$3,500 earlier in the trading session.
- And iron ore is steady at US$99.88 per tonne.
- And Woolworths (ASX:WOW) is scheduled to pay its fully franked interim dividend of 39cps today.
Trading Ideas:
- Bell Potter maintains its BUY rating on Alcidion (ASX:ALC), a commercial healthcare IT company and have maintained their 12-month price target of $0.11. At ALC’s current share price of $0.08, this implies 39.2% share price growth in a year.
- And Trading Central have identified a bearish signal in Qube Holdings (ASX:QUB) indicating that the stock price may fall from the close of $3.79.
Wall St closed lower overnight as Donald Trump criticized Federal Reserve Chair, Jerome Powell. The Dow Jones fell by 2.48%, the S&P 500 dropped 2.36% and the tech-heavy Nasdaq ended Monday’s trading session 2.55% in the red.
Over in Europe, markets closed flat on Thursday following the European Central Banks decision to cut interest rates. The STOXX600 fell 0.1% lower, Germany’s DAX fell 0.49%, the French CAC dropped 0.6% and over in the UK, the FTSE100 closed the trading session flat.
Locally on Thursday, the ASX200 closed 0.78% higher with all but one major sector closing in the green. Gains were led by the energy and material sectors which rose by 3.82% and 1.45% respectively. This was slightly offset by the health sector which dropped by 0.13% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.6% at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.9% lower at US$63.45 per barrel
- Gold is trading 3.15% higher at US$3,431 an ounce
- Iron ore is trading 0.13% lower at US$99.92 per tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Pilbara Minerals (ASX:PLS) and has a 12-month price target of $2. With a current share price of $1.43 this indicates a share price growth of 40% over the next 12-months, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on Light & Wonder (ASX:LNW) indicating that the share price may rise from the close of $125.67 to the range of $169-$179, on a pattern formed over 16 days, according to the standard principles of technical analysis.
Yesterday our local market closed slightly lower, down 0.04%, with energy and information technology down the most.
On the ASX200 leaderboard, BNPL company ZIP Co (ASX:ZIP) advanced more than 16% after the company reported a 219% year-on-year increase in EBITDA of $46 million.
Overnight, US equities closed in the red, with all three major benchmarks down after a significant tech sell- off and tariff concerns. The Dow Jones lost 1.7% or almost 700 points, the S&P500 closed 2.24% lower, while the tech- heavy Nasdaq closed 3.07% lower.
What to watch today:
- The SPI futures are suggesting the Australian market will fall 0.33% at the open this morning, following the heavy sell- off on Wall Street.
- Keep watch of BHP Group (ASX:BHP) this morning as the mining giant is set to release its third quarter update.
- And in economic data, today Australia’s unemployment rate data for March will be released.
- Looking at commodities,
- Crude oil is trading higher, 2.44% in the green at US$62.82 per barrel, as fresh US sanctions on Chinese importers of Iranian crude, reignited supply concerns.
- The price of gold reached a record high, trading up 3.25% at US$3,356.67 an ounce, as the increasing unpredictability of the US trade policy and low demand for the US dollar and Treasury securities has left gold as one of the main saf0- haven commodities.
- And iron ore is steady at US$100.19 a tonne.
Trading Ideas:
- Bell Potter maintains their Buy rating on Select Harvest (ASX:SHV) after the almond grower delivered a disappointing crop update with an approximate 10% downward revision to FY25 crop expectations. Bell Potter believe it was largely offset by stronger pricing outcomes, which look likely to be a greater benefit into FY26-27. Their 12- month price target remains unchanged at $5.80, and at SHV’s current share price of $4.60, this implies 26.1% share price growth in a year.
- Trading Central have identified a bullish signal in QBE Insurance Group (ASX:QBE) indicating that the stock price may rise from the close of $21.36.
Wall St closed modestly lower on Tuesday as investors shifted focus from tariffs to first quarter earnings results. The Dow Jones lost 0.38%, the S&P500 fell 0.17% and the tech-heavy Nasdaq ended the day down 0.05%. Bank of America rose 3.6% yesterday after exceeding analysts’ expectations for Q1 results, while Untied Airlines and Netflix are also expected to report this week. Boeing shares fell more than 2% though on Tuesday on reports that Beijing ordered Chinese airlines not to take anymore of the company’s planes.
In Europe overnight, markets in the region rose amid investor optimism of further tariff exemptions to come from the White House. The STOXX 600 rose 1.6%, Germany’s DAX added 1.3%, the French CAC gained 0.9% and, in the UK, the FTSE100 ended the day up 1.5%.
Across the Asia region on Tuesday, markets mostly rose in the region as a tech rally boosted investor sentiment. Japan’s Nikkei rose 0.84%, South Korea’s Kospi Index gained 0.88%, India’s Nifty 50 rose 2.18% and Hong Kong’s Hang Seng ended the day up 0.23%.
The local market rallied for a second session on Tuesday with a gain of 0.17% after a day of relative calm with minimal news on the tariff front out of the White House. Investors increasingly sought out defensive stocks on Tuesday with CSL and CBA rising 2.56% and 0.87% respectively.
The high growth tech sector came under pressure on Tuesday despite strength on the Nasdaq on Monday and Trump’s exemption of key tech tariffs.
KFC Australia operator Collins Food Group fell over 7.7% on Tuesday after announcing the results of its strategic review including the exiting of its Taco Bell operations in Australia and further expansion of KFC into Germany.
Accent Group on the other hand rallied over 4.5% after announcing it will launch and operate leading global sports retailing business, Sports Direct to Australia and New Zealand. The leading Australian retailer also announced a long-term strategic relationship with Frasers Group, a global retailer of sports, premium and luxury brands based in London, with Frasers also increasing its stake in Accent Group to 19.57%.
What to watch today:
- The Aussie dollar has further strengthened against the greenback to buy 63.48 US cents, 90.82 Japanese Yen, 48.08 British Pence and 1 New Zealand dollar and 8 cents.
- On the commodities front this morning, oil is trading 0.33% lower at US$61.32/barrel, gold is up 0.5% at US$3227.51/ounce and iron ore is up 0.13% at US$100.08/tonne.
- Ahead of the midweek trading session the SPI futures are anticipating the ASX will open the day down just 0.04%
Trading Idea.s:
- Bell Potter has downgraded the rating on Evolution Mining (ASX:EVN) from a buy to a hold and have raised the 12-month price target on the gold and copper miner from $7.89 to $8.10 following the release of the company’s March quarter report which came in strong as Bell Potter was expecting. The downgrade to a hold simply follows recent share price appreciation.
- Trading Central has identified a bullish signal on Universal Stores (ASX:UNI) following the formation of a pattern over a period of 38-days which is roughly the same amount of time the share price may rise from the close of $7.46 to the range of $10.10 to $10.70 according to standard principles of technical analysis.
Wall Street started the new trading week in the green as investors welcomed the latest tariff exemption from Trump in the form of smartphones and computers in addition to other devices and components like semiconductors. The Dow Jones rose 0.78% on Monday, the S&P500 gained 0.79% and the tech-heavy Nasdaq ended the day up 0.64%. While the tariff exemption is welcome right now, Trump teased on Sunday that the exemptions are not permanent, i.e. the Trump tariff rollercoaster continues.
In Europe on Monday, markets closed higher as Trump exemptions boosted investor sentiment, temporarily. The STOXX 600 rose 2.7%, Germany’s DAX gained 2.6%, the French CAC added 2.4% and, in the UK, the FTSE100 ended the day up 2.4%.
Across Asia to start the week, markets in the region rallied as investor appetite for growth and tech stocks rose on Trump’s latest exemption announcement. Hong Kong’s Hang Seng rose 2.4%, China’s CSI index added 0.23%, Japan’s Nikkei rose 1.18%, and South Korea’s Kospi Index ended the day up 0.95%.
Locally on Monday, the ASX200 started the new trading week with a significant rise of 1.3% as investors hold high hopes tariff relief after President Trump began scaling back some tariffs in recent days. Mining stocks regained momentum yesterday with the materials sector rising %, while 10 of the 11 sectors ended the day in the green.
Neuren Pharmaceuticals soared 21% yesterday after the drug maker announced the US FDA has approved the outcomes of a key trial of the company’s second drug candidate for the treatment of Phelan-McDermid Syndrome in Children, which paves the way for the company’s final US FDA approval of the drug before it hits the market.
Gold miners are again drawing investor attention as the price of the precious commodity rallied to yet another fresh record high on Monday and UBS lifted its gold price forecast for the second time in a week, this time to an average of US$3500/ounce in 2026.
On the commodities front this morning, oil is trading 0.18% higher at US$61.61/barrel, gold is down 0.74% at US$3212.46/ounce and iron ore is up just 0.06% at US$99.95/tonne.
What to watch today:
- The Aussie dollar has further strengthened against the greenback overnight to buy 63.24 US cents, 90.50 Japanese Yen, 48.11 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Tuesday’s trading session here in Australia, the SPI Futures are anticipating the local market will open the day up 0.23% tracking global market gains overnight.
Trading Ideas:
- Bell Potter has raised the 12-month price target on De Grey Mining (ASX:DEG) from $1.97 to $2.58 and maintain a hold rating on the gold exploration and development company after Gold Road Resources announced its intention to vote in favour of the proposed all-scrip acquisition of DEG by Northern Star, as Gold Road Resources has an approximate 17.3% stake in DEG.
- Trading Central has identified a bullish signal on SRG Global (ASX:SRG) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may rise from the close of $1.25 to the range of $1.38 to $1.42 according to standard principles of technical analysis.
Wall Street ended the rollercoaster week of last week in the green on Friday after possibly the most volatile week in NYSE history as investors responded live to Trumps tariff updates as they were announced. The Dow Jones rose 1.56%, the S&P500 rose 1.81% and the Nasdaq ended the last trading session of the week up 2.06%. The rise in investor optimism on Friday was due to the White House remaining optimistic a deal on tariffs would be done with China. Let’s hope for some more clarity and calm on global markets this week.
In Europe on Friday markets in the region closed mostly lower to round off a choppy week for stocks in the Eurozone. The STOXX 600 fell 0.1%, Germany’s DAX fell 0.9%, the French CAC dropped 0.3%, and, in the UK, the FTSE100 ended the day up 0.64%.
Across the Asia region on Friday markets closed mixed as investors assessed escalating trade wars with the US. Japan’s Nikkei lost almost 3%, South Korea’s Kospi index fell 0.5%, but Hong Kong’s Hang Seng rose 1.13% and China’s CSI index ended the day up 0.41%.
Locally on Friday the ASX200 fell 0.82% with every sector aside from consumer discretionary stocks ending the day in the red, with healthcare taking the biggest hit amid Trump’s latest tariff announcement on producers in the sector. For the week, the ASX200 lost just 0.28% despite the extreme highs and lows of the trading week.
What to watch today:
- Gold miners rallied last week as the price of the precious commodity topped US$3200/ounce for the first time later in the week.
- On the commodities front this morning oil is trading 2.38% higher at US$61.50/barrel, gold is up 1.5% at US$3236.55/ounce and iron ore is up just 0.06% at US$99.95/tonne.
- The Aussie dollar has slightly improved against most currencies to buy 62.86 US cents, 90.64 Japanese Yen, 49.03 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Monday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.23%.
- This week will be interesting on the tariffs front as we ended last week with Trump raising total tariffs on China to 145% but backtracked on electronics and certain imports that support large caps like Apple.
Trading Ideas:
- Bell Potter has downgraded the rating on Lynas Rare Earths (ASX:LYC) from a hold to a sell as the analyst believes valuation has been overextended and the current share price prices in optimistic expectations. The analyst still believes Lynas is a high-quality business with viable growth options and a strong management team.
- Trading Central has identified a bullish signal on Waypoint REIT (ASX:WPR) following the formation of a pattern over a period of 90-days which is roughly the same amount of time the share price will rise from the close of $2.50 to the range of $2.65 to $2.69 according to standard principles of technical analysis.
Time in the market, rather than timing the market, is what our strategist team at Bell Potter recommend this week, as the spike in market volatility has prompted some investors to contemplate moving their assets into cash as a perceived save haven during these uncertain times.
In this week’s wrap, Sophia covers:
- (0:11): Bell Potter’s view on timing the market
- (2:36): the cost of missing the market’s best days
- (4:46): how the ASX200 performed this week so far
- (5:45): the most traded stocks & ETFs by Bell Direct clients
- (6:12): economic news items to watch out for.
Market movements are up and down this week. Yesterday our local market closed 1.8% in the red, with energy and materials down the most. Champion Iron (ASX:CIA), Nickel Industries (ASX:NIC) and Mineral Resources (ASX:MIN) took the biggest hit down 12% to 14% in a single session.
Overnight, U.S. President Donald Trump has announced a 90-day pause on the 'reciprocal' tariffs his administration had applied to roughly 60 countries.
That means many countries will have their tariffs reduced to a universal rate of 10%, except for China, which will have its tariff increased to 125%. It comes after the U.S. increased tariffs on China to 104% yesterday, which a Chinese Government spokesperson called "economic bullying".
Australia's tariff was always at the 10% rate (which was the minimum rate imposed), so this means there has been no change for us.
Trump said the 90-day pause would allow "more than 75 countries" that had started negotiations with the White House, seeking to reduce its tariffs, to reach a deal.
The announcement of a pause led to a record-breaking day on the U.S. stock market. The Dow Jones closed 7.87% higher, the S&P500 up a record 9.52%, while the tech-heavy Nasdaq advanced 12.16%. It was a historic surge on Wall Street, with the S&P500 seeing its third- largest gain in a singe day since World War II. During the trading session, we saw surprising trading volume of approximately 30 billion shares, the highest level in history, as per records which date back 18 years ago.
What to watch today:
Locally today, the SPI futures are 6.62% higher, after heavy buying in New York.
The de-escalation in trade tensions helped restore confidence across community markets:
- Crude Oil has advanced 5.86% to US$63.07 per barrel
- Natural gas is up 7.75%
- Gold us up 3.58% to $3,084.62, as the US – China tensioned fueled the safe- haven demand
- While iron ore is down 2%, trading at US$99.25.
And one Australian dollar is buying US$0.62, 90.64 Japanese Yen, $0.48 British Pence and a NZ$1.09.
Trading Ideas:
- Bell Potter have upgraded their recommendation from JB Hi- Fi (ASX:JBH) from a Hold to a Buy and have maintained their price target of $99.00. at JBH’s current share price of $88.91, this implies 11.3% share price growth in a year.
- Trading Central have identified a bullish signal in the ASX’s share price, indicating the stock price may rise today from it’s close of $66.21.
Wall St closed lower overnight as investor concerns over Trump’s tariffs returned following a short-lived relief rally. The S&P 500 fell by 1.57%, the Dow Jones dropped 0.84% and the tech-heavy Nasdaq closed 2.15% lower.
Over in Europe, markets snapped their 4-day losing streak with the STOXX600 closing 2.72% higher overnight. Gains were led by insurance and financial services stocks which rose 4.08% and 3.89% respectively. Germany’s DAX rose 2.48%, the French CAC jumped 2.5% and over in the UK, the FTSE 100 ended Tuesday’s trading session 2.71% in the green.
The local market recovered some of the market losses yesterday to close the day up 2.27% after a mass exodus from equities across global markets, since Trump’s liberation day widespread tariff handouts. Gains were led by the information technology and energy sectors which closed 4.63% and 4.06% higher respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 1.88% at market open this morning.
- On the commodities front this morning,
- Oil is trading 3.86% lower at 58 US dollars and 36 cents a barrel, gold is trading 0.03% higher at 2982 US dollars an ounce and iron ore is trading 1.74% lower at 100 US dollars and 85 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Mineral Resources and has a 12-month price target of $29. With a current share price of $16.38, this indicates a share price growth of 77% over the next 12-months, hence the buy rating is recommended.
- Trading Central has identified a bullish signal on TPG Telecom, indicating that the share price may rise from the close of $4.85 to the range of $5.30-$5.45, on a pattern formed over 10 days, according to the standard principles of technical analysis.
Wall Street started the new trading week mostly in the red as investors piled out of equities for a third straight session after President Trump threatened even higher tariffs against China on Monday. Trading volume hit the highest level in 18 years yesterday with markets trading around 29 billion shares. The Dow Jones fell 0.91% on Monday, the S&P500 shed 0.23% and the tech-heavy Nasdaq ended the day up 0.1%.
In Europe overnight, markets in the region started the new trading week lower as investors continue to fear the global fall out of Trump’s Tariffs and implications on economic activity in the Eurozone. The STOXX 600 tumbled 4.54%, Germany’s DAX lost 4.26%, the French CAC plummeted 4.8%, and in the UK, the FTSE100 ended the day down 4.4%.
Asia markets started the week with another sea of red as global trade war fears escalate following China’s reciprocal tariff announcement on Friday. Hong Kong’s Hang Seng plummeted 13.22%, China’s CSI index fell 7.05%, Japan’s Nikkei tumbled 7.83% and South Korea’s Kospi index ended the day down 5.57%.
Locally on Monday, the ASX200 tanked over 4% to post the biggest loss in 5-years after China retaliated with tariffs on US goods, escalating the global trade war and tensions on a global scale.
Abacus Storage King was among the only winners on Monday with a rally over 20% after its majority investor Ki Corporation and NYSE-listed Public Storage lobbed a proposal to buy the remaining stake for $1.47 a share.
Market heavyweights tanked yesterday, with CBA diving over 6%, so too did BHP and other miners as the price of iron ore slumped on global trade and demand concerns.
What to watch today:
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.75% to recover some of the heavy losses experienced in recent days.
- On the commodities front this morning, the sea of red continues with oil trading 1.12% lower at US$61.29/barrel, gold is down 1.65% at US$2987/ounce and iron ore is down 1.5% at US$102.64/tonne.
- The Aussie dollar has further weakened against the USD overnight to buy US$0.59, 88.67 Japanese Yen, 47.08 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has initiated coverage of Trajan Group (ASX:TRJ) with a buy rating and a 12-month price target of $1.50 on the global developer of scientific measurement devices as the analyst sees the company is returning to growth. The analyst sees Trajan Group as offering deep value given it is trading at a 47% discount to close peer Tecan and a 60^ discount to major US peers.
- And Trading Central has identified a bearish signal on EBR Systems (ASX:EBR) following the formation of a pattern over a period of 52-days which is roughly the same amount of time the share price may fall from the close of $1.39 to the range of 75 to 85cps according to standard principles of technical analysis.
Wall St was smashed again on Friday as investors fled equities amid concerns over Trump’s latest tariff implications on the US economy. The Dow Jones tumbled 5.5%, the S&P500 lost 5.97% and the tech-heavy Nasdaq plunged 5.8%. China’s commerce ministry said on Friday that it will impose a 34% levy on all US products without negotiation with President Trump, while tech and other stocks with exposure to China also tumbled as investors brace for impact on such company’s sales, financials and growth outlook.
In Europe on Friday, markets in the region closed sharply lower as investors digested Trump’s liberation day tariffs and after China retaliated with tariffs on the US. The STOXX 600 fell 5%, Germany’s DAX fell 4.7%, the French CAC lost 4.3% and, in the UK, the FTSE100 ended the day down just shy of 5%.
Across the Asia region to end the week, markets closed lower as the global tariff sell-off extended into the region. China’s CSI index fell 0.59%, Japan’s Nikkei tumbled over 4%, Hong Kong’s Hang Seng declined 1.52% and South Korea’s Kospi Index ended the day down 0.76%.
The local market tumbled 2.4% on Friday erasing 57b$ from the ASX200 after global markets reacted to Trump’s liberation day tariff handouts that were larger and broader than expected.
Our market followed the US free-fall on Thursday that saw the Nasdaq tumble 6%, the S&P 500 drop 4.84% and the Dow Jones decline 4%.
Stocks with exposure to the US market were heavily sold off as investors fled exposure to cost hikes faced by such companies under the new 10% blanket tariff on all Aussie exports bound for the US.
In the wake of global uncertainty, investors are increasingly dumping growth stocks in favour of supermarkets given their defensive nature, lack of exposure to the US and guaranteed earnings no matter the time of economic cycle.
Breville Group has been hit hard by the US tariff imposition with the company falling over 11% on Friday and over 6% on Thursday as the company manufactures in China and attributes a large portion of revenues to the US market. Breville has already started moving production out of China, however, will need to assess pricing and strategize to overcome the tariff implications.
Growth stocks associated with the AI revolution were also heavily sold off on Friday with NextDC falling over 6% while geolocation tracking app with a high presence in the US, Life 360, fell over 8%.
What to watch today:
- Ahead of Monday’s trading session to start the new trading week, the SPI futures are anticipating the ASX will open the day down 4.3% tracking the global sell-off on Friday.
- On the commodities front this morning it is a sea of red across the commodities space with oil down 3.14% at US$60/barrel, gold is down 0.57% at US$3020/ounce and iron ore is down 1.5% at US$102.64/tonne.
- The Aussie dollar has weakened against the greenback over the weekend to buy US$60.02, 87.07 Japanese Yen, 46.77 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on Bellevue Gold (ASX:BGL) from a buy to a hold and have lowered the 12-month price target on the gold producer from $2 to $1.30 per share after Q3 production missed guidance by 30%.
- And Trading Central has identified a bearish signal on Generation Development Group (ASX:GDG) following the formation of a pattern over a period of 53-days which is roughly the same amount of time the share price may fall from the close of $4.36 to the range of $3.40 to $3.70 according to standard principles of technical analysis.
Locally from Monday to Thursday, the ASX200 declined 1.53% as global market uncertainty weighed on investor sentiment. Materials and energy stocks took the biggest hit, as investors are concerned over the impact Trump’s tariffs on the global economy.
In this week’s wrap, Grady covers:
- (0:10): the RBA’s cash rate decision
- (0:27): the global impact of Trump’s Liberation Day
- (2:37): Trump’s beef with Aussie beef explained
- (4:33): How Aussie companies may respond to tariffs
- (6:35): the most traded stocks & ETFs by Bell Direct clients
- (7:00): economic news items to watch out for.
Wall St closed higher overnight as investors get ready for the rollout of President, Donald Trump’s reciprocal tariff plans. The Dow Jones gained over half a percent, the S&P500 rose by 0.67% and the tech-heavy Nasdaq jumped 0.87%.
Over in Europe, markets closed lower as traders digest news of Trump’s tariff plans. The STOXX600 fell half a percent with most sectors closing Wednesday’s trading session in the red. Germany’s DAX lost 0.66%, the French CAC dropped 0.22% and over in the UK, the FTSE100 ended the day 0.3% down.
Locally yesterday, the ASX200 rose by 0.12% with half of the major sectors closing in the green. Gains were led by the real estate and communication services sectors which rose by 1.63% and 0.8% respectively. This was offset by the materials sector which fell by 1.61% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.53% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.66% down to 70 US dollars and 65 cents a barrel as Trump’s tariff announcement increases uncertainty on oil demand.
- Gold is trading up 0.47% at 3129 US dollars an ounce and iron ore is trading 0.29% lower at 102 US dollars and 21 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on HUB24 (ASX:HUB), despite reducing its 12-month price target to $78. With a current share price of $68.11, this indicates a share price growth of 14.5% over the next 12-months, hence the buy rating is maintained.
- And Bell Potter maintains a hold rating on Netwealth Group (ASX:NWL) and has a 12-month price target of $25.80. Bell Potter maintains a hold rating as they see emerging upside risk to flows with longer-term growth already captured and implied in discounted cashflows through their valuation approach. Other providers have delivered impactful new technology enhancements during the last 12-months, limiting the balance of growth and margins, hence the hold rating is maintained.
Wall Street closed Tuesday’s session higher in yet another volatile session as traders took advantage of market uncertainty ahead of Trump’s tariff handouts on April 2nd US time, and on the back of weaker-than-expected economic data weighing on investor sentiment. The S&P500 rose 0.38%, the Dow Jones added 0.03% and the Nasdaq ended the day up 0.87%. Investor sentiment was also hit by the Institute for Supply Management manufacturing survey coming in lighter than expected and in contraction territory for February, while February’s job openings were also slightly below estimates in signs the economy is slowing due to tariff implications on US economic stability.
In Europe overnight, markets reversed Monday’s losses to close higher as eurozone inflation data for March showed inflation in the region cooled as expected to 2.2% for the month. The STOXX 600 rose 1.07%, Germany’s DAX added 1.7%, the French CAC gained 1.1% and, in the UK, the FTSE100 ended the day up 0.61%.
Across the Asia markets on Tuesday, markets also rebounded in the region following Monday’s sell-off as investors await clarity on Trump’s incoming tariffs, Japan’s Nikkei rose 0.11%, South Korea’s Kospi Index added 1.62%, Hong Kong’s Hang Seng gained 0.38% and China’s CSI index ended the day flat.
The local market started the trading week mixed with the third-worst session of 2025 posted on Monday followed by a recovery on Tuesday with the key index ending Tuesday’s session up 1%.
The RBA also held the nation’s cash rate at 4.1% for the next period to assess the unfolding trade situation with the US and to ensure inflation in Australia remains on track in the target range of 2-3%.
Elsewhere in the economic data space, Australia’s latest retail sales figures for February were released yesterday coming in at a rise of 0.2% for February which fell short of economists’ expectations and is a positive reading for Australia’s inflation journey easing as consumer spend is a big contributor to inflationary pressures.
Investors really are riding the wave of volatility right now ahead of Trump’s ‘Liberation Day’ reciprocal tariff day in the US on Wednesday the 2nd April whereby it is expected the US President will announce an array of tariffs on countries that he believes have been unfairly taxing US imports for some time.
The recent volatility has propelled gold to yet another record high overnight with the price of the commodity touching US$3145/ounce as investors flock to the safe-haven asset during times of high uncertainty.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.35% tracking Wall Street’s rally overnight.
- On the commodities front this morning, oil is trading 0.33% lower at US$71.25/barrel, gold is down 0.24% at US$3112/ounce and iron ore is up 0.08% at US$102.51/tonne.
- The Aussie dollar has slightly strengthened against the greenback overnight to buy US$0.62, 93.70 Japanese Yen, 48.44 British pence and NZ$1.10 cents.
Trading Ideas:
- Bell Potter has downgraded Opthea (ASX:OPT) to a sell rating from a buy rating and have dropped the 12-month price target on the company to 5cps following the release of Phase 3 trial results that failed to show any benefit in improving visual acuity when combined with either Eylea or Lucentis across both primary and key secondary endpoints.
- And Bell Potter has raised the 12-month price target on Aristocrat Leisure (ASX:ALL) from $83 to $85 and maintain a buy rating on the hotels and gaming company after the company’s Phoenix Link has grown to 750 units in the EK database after just 4-months with performance strong at 2.5x floor average although trending down. The analyst expects operating momentum in FY25 to accelerate, particularly in Gaming Operations.
The world’s largest market, the US, started the new trading week mostly in the green despite investors remaining nervous about ‘liberation day’ on April 2nd whereby it is expected President Donald Trump will announce an array of reciprocal tariffs on countries he believes have been tough on the US in terms of tariffs and trade in recent years. The Dow Jones rose 1%, the S&P500 added 0.55% and the tech-heavy Nasdaq ended the day down 0.14%.
In Europe overnight the sea of red extended into the new trading week across the region as investors brace for reciprocal tariffs out of the US on 2nd April. The STOXX600 fell 1.51% to post the first losing month on the index for 2025. Germany’s DAX lost 1.33%, the French CAC fell 1.58% and, in the UK, the FTSE100 ended the day down 0.88%.
Across the APAC region on Monday, markets also closed lower on Monday ahead of Trump’s second round of tariffs to be announced. Japan’s Nikkei plunged 4.05%, China’s CSI index lost 0.71%, Hong Kong’s Hang Seng fell 1.09% and South Korea’s Kospi index ended the day down 3%.
South Korea and Japan are expected to bear much of the brunt of Trump’s newly introduced 25% automotive tariff with these regions ranking 2nd and 3rd among the countries with the highest automotive trade with the US.
Locally to start the week the ASX200 plunged into the red with a 1.7% decline at the closing bell to mark the 3rd worst trading session of the year, as global market sentiment remains uneasy amid escalated tariff, trade war and subdued economic global growth concerns.
The iron ore mining giants were sold off on Monday as the outlook for exports remains murky, especially to our largest trade partner, China. BHP, Rio and Champion Iron each fell over 3%, over 4% and over 5% respectively to start the new trading week lower.
Domain shares fell almost 2% on Monday after the board unanimously recommended a takeover bid from US real estate company CoStar to shareholders. Shareholders were seemingly unimpressed which led to the sell-off yesterday.
What to watch today:
- Ahead of Tuesday’s trading session the ASX, the SPI futures are anticipating the market will open the day up 0.85% tracking Wall Street’s gains overnight.
- The all-important RBA interest rate meeting is today with the market expecting Australia’s central bank to hold the current cash rate at 4.1% for the next period.
- On the commodities front this morning, oil is trading 2.85% higher at US$71.34/barrel, gold is 1.3% higher at US$3124/ounce and iron ore is up 0.07% at US$102.43/tonne.
- The Aussie dollar has weakened against the greenback overnight to buy US$0.62, 93.67 Japanese Yen, 48.22 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has slightly reduced the 12-month price target on Light & Wonder (ASX:LNW) from $205 to $197 and maintain a buy rating on the leading global cross-platform games operator after Aristocrat Leisure escalated its legal fight against Light and Wonder with a second amended complaint around LNW’s Jewel of the Dragon game.
- And Trading Central has identified a bearish signal on Cochlear (ASX:COH) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may fall from the close of $262.30 to the range of $246 to $250 according to standard principles of technical analysis.
Wall Street closed lower on Friday as hotter-than-expected personal spending inflation data and US trade policy uncertainty dampened investor sentiment. The Dow Jones fell 1.7% on Friday, the S&P 500 lost 1.97% and the tech heavy Nasdaq ended the day down 2.7%.
On Friday U.S. core personal consumption expenditures price index came in hotter-than-expected for February with a rise of 2.8% and 0.4% MoM indicating persistent inflation across consumer spending.
Over in Europe on Friday, markets in the region closed lower as global market sentiment declines on trade and tariff uncertainty. The STOXX 600 fell 0.77%, Germany’s DAX and the French CAC each lost 1%, and, in the UK, the FTSE100 ended the day flat.
Across Asia on Friday, Trump tariff threats continue to keep investors on edge in the region which led to a negative day across the board on Friday. Japan’s Nikkei lost 1.8%, South Korea’s Kospi index ended the day down 1.9%, Hong Kong’s Hang Seng fell 0.65% and China’s CSI index ended the day down 0.44%.
Locally to end the week the ASX edged 0.2% higher to end a volatile trading week as Trump’s tariffs cloud economic outlook on a global scale. Despite the turbulence, the ASX200 posted a 0.6% gain for the trading week last week as a 2.55% rally for the financial sector and 2% gain among energy stocks offset weakness among the rate sensitive sectors of REIT and Tech stocks.
Packaging group Orora took the biggest hit on Friday with an 8% decline after the French Competition Authority announced a review into industry-wide anticompetitive practices, which includes into Saverglass, a European bottle maker that Orora acquired in 2023.
Paladin Energy fell a further 4.1% on Friday after the uranium producer retracted its 2025 production guidance due to unseasonably heavy rainfall in Namibia in recent times, which is where Paladin’s Langer Heinrich mine is located.
What to watch today:
- Ahead of Monday’s trading session here in Australia, the SPI futures are anticipating the ASX will open the day down 1.13%.
- On the commodities front this morning oil is trading 0.8% lower at US$69.36/barrel, gold is up 0.94% at US$3084.35/ounce and iron ore is up 0.07% at US$102.43/tonne.
- The Aussie dollar has weakened against the greenback to buy 62.80 US cents, 94.27 Japanese Yen, 49.03 British Pence, and NZ$1.11.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Pro Medicus (ASX:PME) from $330/share to $280/share and maintain a buy rating on the leading medical imaging company after Bell Potter’s analyst completed a review into the timing of new contract installations and their subsequent impacts on revenue over the coming years. The downgrade in PT is due to downgrades in FY25 and FY26 EPS expectations from the analyst following the review into the contract installations.
- And Trading Central has identified a bullish signal on Telstra Group (ASX:TLS) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $4.23 to the range of $4.31 to $4.35 according to standard principles of technical analysis.
This week, news headlines around the Trump Tariffs continued, with President Donald Trump announcing a 25% tariff on all cars and parts that are not built or produced in the US. US consumer and business confidence are taking a hit, so where does this leave you and your investment decisions?
In this week’s wrap, Grady covers:
- (0:11): how the Trump Tariffs impact investors
- (1:59): why copper prices hit a fresh record high
- (3:52): the impact on US consumer & business confidence
- (4:54): how the ASX200 performed this week so far
- (5:37): the most traded stocks & ETFs by Bell Direct clients
- (6:05): economic news items to watch out for next week.
Wall St closed lower overnight as Donald Trump announced a new 25% tariff on auto imports into the United States. The Dow Jones fell 0.31%, the S&P 500 lost 1.12% and the tech-heavy Nasdaq dropped by over 2%.
In terms of US stocks, Meta Platforms and Amazon lost more than 2%, Alphabet closed more than 3% lower and Tesla closed nearly 6% in the red.
Over in Europe, markets closed lower as investors react to new tariffs implemented over in the US. The STOXX600 dropped 0.7%, led by autos which fell by 2.6%. Germany’s DAX lowered 1.17%, the French CAC closed nearly 1% lower, whilst over in the UK, the FTSE100 rose by 0.3%.
Locally yesterday, the ASX200 rose by 0.71% with all but one major sector closing in the green. Gains were led by the consumer staples and real estate sectors which rose by 1.19% and 1.15% respectively. This was offset by the health sector which fell by over half a percent by the closing bell.
Monthly inflation data was released yesterday coming in at 2.4% for February. This was lower than consensus of 2.5% and the forecast of 2.6%. The CPI falling is a good thing for the RBA’s outlook for rate cuts to come as inflation drivers are all moving in the right direction – wages price inflation came down, GDP uptick, retail sales easing and the unemployment rate ticked back up to 4.1% which is favourable for the rate cut journey.
What to watch today:
- The Australian share market is set to open lower with the SPI futures suggesting a fall of 0.46% at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.36% higher at 69 US dollars and 94 cents a barrel, as investors increase concerns over tight oil supply.
- Gold fell by just 0.04% to 3019 US dollars an ounce and iron ore is trading 0.03% lower at 102 US dollars and 18 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Whitehaven Coal (ASX:WHC) and has a 12-month price target of $7.70. The buy rating is maintained by Bell Potter as their balance sheet will significantly de-risk with the Blackwater selldown completion in late March 2025. As well, further productivity enhancements across WHC’s Queensland portfolio should support higher production, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU), indicating that the stock price may rise from the close of $3.23 to the range of $3.53-$3.61, on a pattern formed over 8 days, according to the standard principles of technical analysis.
Wall St closed higher overnight for its third straight session on higher hopes of softer US tariffs. The Dow Jones rose slightly by 0.01%, the S&P 500 jumped 0.16% and the tech-heavy Nasdaq gained 0.46%.
Europe followed the US and closed higher with the STOXX600 rising 0.67%, with all major sectors closing in positive territory. Germany’s DAX climbed 1.13%, the French CAC gained 1.08% and over in the UK, the FTSE100 ended Tuesday’s session 0.3% in the green.
Locally yesterday, the market has continued with the same volatility we’ve seen over the past few weeks with the ASX200 rising by 0.07%. Gains were led by the information technology and health sectors which rose by 1.87% and 0.98%. This was slightly offset by the consumer staples sector which fell by 0.86% by market close.
Australia’s Federal budget for 2025-2026 was handed down last night but should pose little impact on the market movements today as much of the government spend updates were pre-announced. However, the one key highlight was that the budget deficit is expected to widen to $42.1bn, or 1.5% of GDP in 2025-2026. The key inclusions were the $150 energy bill relief for all Australians to help with cost of living pressures, an $8.5bn boost to Medicare, $1bn in military spend which has been brought forward with the total defence spend at $10.6bn over the next 4-years, and states and territories will also be offered almost $50m in funding to grow local housing industries amid the housing crisis currently operating in Australia.
What to watch locally today,
- The Australian share market is set to open higher with the SPI futures set to rise by 0.59% at market open this morning.
- On the commodities front this morning, oil is trading 0.12% higher at 69 US dollars and 19 cents a barrel, gold is trading 0.28% higher at 3018 US dollars an ounce and iron ore is trading 0.21% higher at 102 US dollars and 21 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Gold Road Resources (ASX:GOR), with a 12-month price target of $3.20. With a current share price of $2.79, this indicates a share price growth of 14.7% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Tabcorp Holdings (ASX:TAH), indicating that the share price may rise form the close of $0.62 to the range $0.73-$0.75, on a pattern formed over 18 days, according to the standard principles of technical analysis.
Wall Street started the new trading week higher across the key indices as investors remain optimistic that President Donald Trump may hold back from implementing some of his tariff plans that could lead to an escalated trade war and economic slowdown in the US. The Dow Jones rose 1.42% on Monday, the S&P500 climbed 1.76% and the tech-heavy Nasdaq ended the day up 2.27%.
Across the European markets on Monday, markets in the region closed slightly lower as investor optimism around Trump easing tariffs faded. The STOXX 600 fell 0.13%, Germany’s DAX lost 0.17%, the French CAC dropped 0.26% and, in the UK, the FTSE100 ended the day down 0.1%.
Asia markets closed Monday’s session mixed as Trump’s reciprocal tariff deadline of April 2 draws closer. South Korea’s Kospi Index lost 0.42%, and Japan’s Nikkei fell 0.18%, while Hong Kong’s Hang Seng rose 0.91% and China’s CSI index rose 0.51%.
Locally to start the week, the ASX200 seesawed between positive and negative before ending the day just 0.07% higher as a banking rally offset heavy losses among staples, tech and industrials stocks.
Investors took some profits from the supermarket giants yesterday following a strong rally for both Coles and Woolworths on Friday amid the lack of evidence of price gauging found by the ACCC in their investigation.
Synlait Milk shares tumbled over 8% on Monday after the milk producers’ latest results failed to impress investors despite the NZ-based company reporting a swing to profitability with a 105% increase in NPAT to $4.8m.
And global building materials and fibre cement company James Hardie Industries weighed on the market gains yesterday following the company announcing it has entered into an agreement to acquire US-based AZEK which is a leader in providing high-performance, low-maintenance building products and solutions. Investors fled the stock upon release of the announcement as the deal is valued $14bn, which is an expensive multiple to pay, around 23 x EBITDA compared to JHX current multiple of 12x.
What to watch today:
- Ahead of Tuesday’s trading session in Australia the SPI futures are anticipating the ASX will open the day up 0.45% tracking Wall Street’s gains overnight.
- On the commodities front this morning oil is trading 1.25% higher at US$69.13/barrel, gold is down 0.4% at US$3011.82/ounce and iron ore is down 0.15% at US$102/tonne.
- The Aussie dollar has further strengthened against the greenback to buy US$0.62, 94.72 Japanese Yen, 48.62 British Pence, and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the rating on Catalyst Metals (ASX:CYL) from a hold to a buy and have raised the 12-month price target on the gold production and development company from $4.45 to $5.50 following the company’s announcement of the sale of its non-core Henty Gold Mine to Kaiser Reed to simplify the business, enable greater focus on the expansion and exploration of the flag ship Plutonic Gold Operation and adding a clow cost and rapid option to unlock value at the Bendigo Project.
- And Trading Central has identified a bearish signal on ARB Corporation (ASX:ARB) following the formation of a pattern over a period of 8-days which is roughly the same amount of time the share price may fall from the close of $34.00 to the range of $26.25 to $27.50 according to standard principles of technical analysis.
Wall St closed a turbulent week higher on Friday as Trump, once again, signalled there would be some ‘flexibility’ with tariffs, however, he did maintain that the tariffs implemented at the April 2 deadline will be reciprocal, saying all countries that have tariffs on US goods will be taxed. The Nasdaq rose 0.2%, the Dow Jones added just 0.08%, and the S&P500 also ended the day up 0.08%. Companies are increasingly confused over the tariff implications in the US and as a result as uncertain about spend, hiring and forecasting until there is more clarity around tariff implications.
In Europe on Friday, markets in the region closed lower led by travel stocks tumbling amid London’s Heathrow Airport closure due to a fire on Friday. The STOXX 600, French CAC and the UK’s FTSE100 ended the day down 0.6%, while Germany’s DAX ended the day down 0.5%.
Across Asia markets on Friday, stocks mostly fell in the region due to ongoing uncertainty around the US economy and tariff implications. Hong Kong’s Hang Seng fell 2.19%, China’s CSI index fell 1.52%, South Korea’s Kospi index ended the day up 0.23%, and Japan’s Nikkei ended the day down 0.2%.
Locally on Friday, the ASX200 rose 0.17% despite Wall Street’s turbulence on Thursday as market heavyweights propelled the key index to a positive finish. For the week, the ASX200 rose 1.83%
Australia’s supermarket giants posted strong gains on Friday after the ACCC released its 441-page findings of its ‘price gauging’ investigation. Investors welcomed the findings outlining minimal evidence was found of price gauging and no disciplinary action would be taken against the two key providers in Coles and Woolworths.
What to watch today:
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the new trading week down 0.51%.
- Commodity prices took a hit late in the week last week which weighed on the local materials sector as China’s property market remains depreciated, and Trump’s tariffs continue hurting demand for critical metals like copper.
- On the commodities front this morning, oil is trading 0.31% higher at US$68.28/barrel, gold is down 0.75% at US$3023.65/ounce and iron ore is down 0.15% at US$102/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy US$0.62 cents, 93.69 Japanese Yen, 48.55 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has initiated coverage of Cuscal (ASX:CCL) with a buy rating and a 12-month price target of $3.40 on the payments and regulated data service provider. Bell Potter’s analyst sees compound gross revenue growth of 17.7% pa driven primarily by growth in transaction revenue across all core competencies and client wins. The company also has demonstrated a track record of innovation, investment and timing with launching milestone connectivity for all mobile payments and acquiring Basiq in 2024 to expand its market presence and offering.
- And Trading Central has identified a bullish signal on Regis Healthcare (ASX:REG) following the formation of a pattern over a period of 109-days which is roughly the same amount of time the share price may rise from the close of $6.72 to the range of $7.50 to $7.70 according to standard principles of technical analysis.
Locally this week, the ASX200 rose 1.66% (Mon – Thurs), recovering some earlier losses. Ten of the eleven industry sectors closed in the green, while consumer staples were slightly lower. Energy stocks advanced the most, up 3.5% over the week so far.
In this week’s wrap, Grady covers:
- (0:10): the latest on Trump’s tariffs & US policy volatility
- (0:37): fresh stimulus & economic data in Hong Kong
- (1:00): China’s latest economic data
- (2:10): what this week’s unemployment data means for the Aussie economy
- (3:58): the best & worst performing stocks on the ASX200 this week
- (4:45): the most traded stocks & ETFs by Bell Direct clients
- (5:11): economic news items to watch next week.
Wall St closed higher on Wednesday after the Fed said two rate cuts are still on the cards for 2025. The Dow Jones rose 0.92%, the S&P500 added 1.08% and the Nasdaq ended the day up 1.41%. The US central bank maintained the current cash rate as was widely expected at the latest meeting overnight however boosted investor sentiment by saying two rate cuts are still coming this year.
In Europe overnight, markets closed mostly higher led by the French CAC rising 0.7%, while the STOXX 600 added 0.26%, Germany’s DAX fell 0.34% and the UK’s FTSE 100 ended the day flat.
The APAC markets closed the midweek session mixed on turbulence in the US on Tuesday and after Japan’s central bank maintained interest rates steady at 0.5% and signalled potential impact of US President, Donald Trump’s tariffs. Japan’s Nikkei lost 0.25%, South Korea’s Kospi index rose 0.62%, China’s CSI index closed flat and Hong Kong’s Hang Seng also ended the day flat.
The market movements locally yesterday matched the rollercoaster of sentiment around the globe right now, with the ASX bouncing between red and green before sliding in afternoon trade with the key index ending the day down 0.41%.
Materials stocks came under pressure yesterday amid a 5.1% sell-off in Mineral Resources following the cessation of haulage on its crucial Onslow iron haul road, while gold miners also slipped as traders took profits on the record gold price rally this week.
Mortgages insurer Helia Group took the biggest hit yesterday with a 15% dive after shares traded ex-dividend.
What to watch today:
- On the commodities front this morning oil is trading 0.5% higher at US$67.23/barrel, gold is up 0.51% at US$3047/ounce and iron ore is up 0.1% at US$102.42/tonne.
- The Aussie dollar has further strengthened overnight to buy 63.61 US cents, 94.61 Japanese Yen, 49.13 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of Thursday’s trading session on the ASX the SPI futures are anticipating the ASX will open the day up 0.67% tracking Wall Street’s gains overnight.
Trading Ideas:
- Bell Potter has upgraded the rating on Alcidion (ASX:ALC) from a hold to a buy and maintain a 12-month price target of 11cps on the healthcare IT company following a significant restructure of the business through reducing headcount and operating expenses, while also signing its largest commercial contract to date with NCIC to the value of $37.5m over 10-years.
- Trading Central has identified a bearish signal on Stockland Corp (ASX:SGP) following the formation of a pattern over a period of 5-days which is roughly the same amount of time the share price may fall from the close of $4.88 to the range of $4.54 to $4.60 according to standard principles of technical analysis.
Wall Street slipped into the red again on Tuesday with the S&P500 fighting to stay out of correction territory as it trades 8.6% below its recent record, as investors remain concerned over the impacts Trump’s tariffs will have on the US economy. The Dow Jones lost 0.62%, the S&P500 shed 1.07% and the tech-heavy Nasdaq ended the day down 1.71%. Tesla shares have been hit hard lately and took a further 5% tumble on Tuesday after RBC Capital Markets lowered its price target on the EV company citing rising competition in the EV space.
Over in Europe on Tuesday, markets in the region closed higher as investors assessed momentum in Germany’s historic debt reform deal, which unlocks a major stimulus package for higher defence, infrastructure and climate fund spending. The STOXX 600 rose 0.61%, Germany’s DAX added 1.03%, the French CAC gained 0.5% and, in the UK, the FTSE100 ended the day up 0.29%.
Across the APAC region overnight Hong Kong’s Hang Seng rallied again to a three-year high yesterday, ending the day up 2.29% as investors continue piling into tech stocks listed on the index following fresh stimulus and strong economic data out in the region. China’s CSI index rose 0.27%, Japan’s Nikkei gained 1.2% and South Korea’s Kospi Index ended the day up 0.06%.
Locally, the ASX started the week higher before pulling back yesterday as the local market is taking strong lead from Wall Street movements amid global uncertainty over Trump’s tariffs and subsequent implications of taxes imposed on good being imported into the US.
Rising geopolitical tensions in the form of Israel launching a wave of airstrikes across the Gaza Strip on Tuesday propelled the price of gold to another fresh record high as investors flock into the safe-haven asset in times of great uncertainty.
Defensive stocks in the utilities, consumer staples and healthcare sectors all outperformed yesterday, for a similar reason to gold’s rally, as investors look for investments that are mostly unaffected by a downturn in the economy.
On that note, Woolworths shares jumped over 1% yesterday after Macquarie upgraded the supermarket to an outperform rating, while former Woolworths alcohol arm, Endeavour slipped 1.6% yesterday after Goldman Sachs downgraded the alcohol retailer to neutral.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.66% tracking Wall Street’s turbulence overnight.
- On the commodities front this morning, oil is trading 0.94% lower at US$66.95/barrel, gold is up 1.10% to a fresh record US$3032.60/ounce, and iron ore is down 0.52% at US$102.32/tonne.
- The Aussie dollar has further strengthened against the greenback overnight to buy US$0.63, 94.99 Japanese Yen, 49.15 British Pence and 1 NZ$1.09 cents.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on REA Group (ASX:REA) from $281 to $264 and maintain a buy rating on the leading online real estate listings platform following the release of February property data including a national listings declining 8% YoY for the month. REA also guided to ‘flat-to-marginal’ increase in FY25 listings amid a slow housing market in Australia at present.
Wall St closed higher to start the trading week, posting back to back session gains following recent tariff policy news which has softened the market. The Dow Jones rose by 0.85%, the S&P500 jumped 0.65% and the tech-heavy Nasdaq rallied by 0.31%.
Over in Europe, markets followed the US and closed higher to start the trading week on a positive note. The STOXX600 closed 0.79% higher with all but one major sector closing in the green. Germany’s DAX jumped 0.73%, the French CAC climbed 0.56% and over in the UK, the FTSE100 ended Monday’s trading session 0.73% in the green.
Locally yesterday, the Australian share market rose by 0.83% with the majority of sectors closing in the green. Gains were led by the materials and energy sectors which rose by 1.97% and 1.72% respectively. This was offset by the health sector which fell by 0.27% by market close.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.67% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.45% higher at 67 US dollars and 48 cents a barrel, gold is trading 0.6% higher at 3001 US dollars an ounce and iron ore is trading 0.68% higher at 102 US dollars and 85 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Nufarm Ltd (ASX:NUF) with a 12-month price target of $4.75. With a current share price of $3.84, this indicates a share price growth of 23.7% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Nick Scali (ASX:NCK), indicating that the stock price may rise from the close of $15.69 to the range of $19.20-$20, on a pattern formed over 26 days according to the standard principles of technical analysis.
What a week it was on markets last week as Trump tariffs and global trade war concerns spread fear throughout global markets leading to a mass sell off in equities and the price of safe-haven gold topping US$3000/ounce for the first time ever.
Wall Street reversed some of last week’s losses to close higher across the key indices on Friday as news out of the Whitehouse around tariffs eased on Friday which prompted investors to reconsider buying into equities following days of sharp selloffs. The Dow Jones rose 1.65% on Friday, the S&P500 added 2.13% and the Nasdaq ended the day up 2.61%. The see-saw of tariffs being on, and off Trump’s policy front has spooked markets over the last week as investors shift portfolios into safe-haven assets to manage the current high volatility among equities and global markets.
In Europe on Friday markets closed higher after German lawmakers came closer to agreeing on reforming the country’s debt-brake rule. The STOXX 600 rose 1.14%, Germany’s DAX climbed 1.65%, the French CAC added 1.05%, and, in the UK, the FTSE100 ended the day up 1.13%.
Across the APAC region last week, markets mostly rose on Friday despite Wall Street’s tumble on Thursday. Japan’s Nikkei rose 0.72%, Hong Kong’s Hang Seng added 2.12%, China’s CSI index gained 2.43% but South Korea’s Kospi Index ended the day down 0.28%.
Locally on Friday the ASX200 recovered some ground with a 0.52% rise at the closing bell, but the key index posted a 2% fall for the week last week. Rate sensitive sectors of tech and consumer discretionary took the biggest hits last week as consumers fear inflation in the U.S. and locally can rebound as a result of Trump’s tariffs.
What to watch locally today:
- Ahead of Monday’s trading session on the ASX, the SPI futures are anticipating the local market will open the new trading week up 1.09% tracking Wall Street’s rise on Friday.
- On the commodities front this morning oil is up 0.95% at US$67.18/barrel, gold is up 2.47% at US$2983/ounce and iron ore is up 0.7% at US$102.85/tonne.
- The Aussie dollar has slightly strengthened to buy US$0.63, 94.10 Japanese Yen, 48.64 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage of Seek (ASX:SEK) with a buy rating and a 12-month price target of $27.00 with the view that the company’s market leading portfolio is centralised for scaling. Seek is the largest marketplace in Australia for job advertisements and the analyst can see potential ad volumes increasing as macro tailwinds are driven by the RBA’s cutting cycle.
- And Trading Central has identified a bearish signal on South32 (ASX:S32) following the formation of a pattern over a period of 70-days which is roughly the same amount of time the share price may fall from the close of $3.53 to the range of $2.96 to $3.06 according to standard principles of technical analysis.
How have markets reacted to the US tariffs?
News headlines around the US saw the Australian market decline over 2% Monday to Thursday this week, with information technology and industrials down the most. The only two industry sections in the green over this week so far, are utilities up 2% and energy up 1.05%.
Wall St closed mixed overnight following the release of a softer than expected inflation report. The Dow Jones fell by 0.2%, the S&P 500 rose by nearly half a percent and the tech-heavy Nasdaq jumped 1.22%.
Core inflation data month was released overnight coming in at 0.2%, lower than the consensus and forecast of 0.3% and its previous result of 0.4%.
Over in Europe, markets closed higher despite the announcement by the European Union of an introduction of tariffs on a variety of US imports. The STOXX600 rose by 0.81%, Germany’s DAX climbed 1.56%, the French CAC rallied 0.59% and over in the UK, the FTSE100 ended Wednesday’s trading session higher by 0.53%.
Locally yesterday, the ASX200 fell by 1.32% with all but one major sector closing in the red. Losses were led by the consumer discretionary and industrial sectors which lost 2.02% and 1.88% respectively. This was slightly offset by the utilities sector which rose by just 0.02%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.23% at market open this morning.
- On the commodities front this morning,
- Oil is trading 2.17% higher at 67 US dollars and 69 cents a barrel as easing inflation boosted market sentiment.
- Gold is trading 0.62% higher at 2933 US dollars an ounce and iron ore is trading 0.06% higher at 101 US dollars and 5 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Alkane Resources (ASX:ALK) with a 12-month price target of $1.20. With a current share price of $0.59, this indicates a share price growth greater than 100%, hence the buy rating is maintained.
- And Bell Potter also maintains a buy rating on Elders (ASX:ELD) with a 12-month price target of $9.40. At a current share price of $6.91, this indicates a share price growth of 36% over the next 12-months, hence the buy rating is maintained.
Wall St closed lower overnight as the Dow Jones loses more than 450 points. The S&P 500 dropped 0.75%, the tech-heavy Nasdaq lost 0.18% and the Dow Jones fell by over 1%.
The S&P 500 was in the green at one point of the trading session until Donald Trump declared that Canadian steel and aluminum duties would double from 25% to 50%.
Over in Europe, markets followed the US and closed lower as trade tensions between the US and Canada escalate. The STOXX600 fell by 1.7%, led by autos which fell by 2.13%. Germany’s DAX closed 1.29% lower, the French CAC lost 1.31% down and over in the UK, the FTSE100 ended Tuesday’s trading session 1.21% in the red.
Locally yesterday, the ASX200 fell by 0.91% with the majority of sectors closing in the red. Losses were led by the information technology and industrial sectors which fell by 3.95% and 1.98% respectively. This was offset by the utilities sector which gained 1.37% by the closing bell.
What to watch today:
- The Australian share market is set to open lower with the SPI futures predicting a fall of 0.95% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.89% higher at 66 US dollars and 62 cents, gold is trading 1.09% higher at 2915 US dollars an ounce and iron ore is trading 0.3% lower at 100 US dollars and 99 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Regal Partners (ASX:RPL) and has a 12-month price target of $5. With a current share price of $2.83, this indicates a share price growth of 76.7%, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on AGL Energy (ASX:AGL), indicating that the stock price may rise from the close of $10.13 to the range of $12.20-$12.60, on a pattern formed over 19 days, according to the standard principles of technical analysis.
Our local market started the week retrieving earlier losses, gaining 0.18% yesterday, as energy, materials and utilities advanced. Polynovo (ASX:PNV) rebounded, leading the market up 4.6% at the close, while Beach Energy (ASX:BPT) closely followed. On the other hand, Johns Lyng Group (ASX:JLG) tumbled over 12% yesterday following the announcement that JP Morgan is now a substantial holder. Overnight, the 3- week market sell off in the US equities intensified as the key benchmarks continue to close in the red. The Dow Jones down nearly 900 points, the S&P500 down 2.7%, while the Nasdaq had its worst session since 2022, closing 4% lower. Investors are cautious amid fears that that uncertainty around tariff policy may tip the economy into a recession.
What to watch locally today:
- Following US equities, the Australian market is set to open lower, with the SPI futures suggesting a drop of 0.88%.
- In commodities,
- Crude Oil is down 1.7% trading at US$65.90, nearing a 6- month low.
- Gold is down 0.78% at US$2,889 an ounce but remained near record highs as trade tensions continued to shape market sentiment, with investors closely watching U.S. inflation data due later this week for insights into the Federal Reserve’s next moves.
- While iron ore is up slightly, trading at US$101.29.
- And the Aussie dollar is buying US$0.63, 49 British pence, 92.43 Japanese Yen and NZ$1.10.
Trading Ideas:
- Bell Potter maintain a BUY rating on AMA Group (ASX:AMA) after the accident repair group reported a good result for the first half of FY25 last month. AMA also reiterated its FY25 guidance. There is no change to Bell Potter’s price target of $0.08 which was updated last month following the release of the company’s financial results. The price target is a more than 50% premium to the share price.
- And Trading Central have identified a bullish signal in ClearView Wealth (ASX:CVW) indicating that the stock price may rise from the close of $0.47 to the range of $0.55 - $0.57 over 7 days, according to the standard principles of technical analysis.
On Wall Street on Friday markets ended the week higher in what was the worst week the S&P 500 has had since September. The Dow Jones rose over half a percent, the tech-heavy Nasdaq gained 0.71% and the S&P500 jumped 0.56%.
A US jobs data report was released on Friday, falling below expectations to 151,000 jobs in February, well below the consensus of 170,000 jobs predicted by economists.
Over in Europe, markets closed lower on Friday following investor reactions to tariff implementation over in the US. The STOXX600 fell 0.46%, it’s first losing session of the year. Germany’s DAX dropped 1.75%, the French CAC lost 0.94% and over in the UK, the FTSE100 closed 0.03% lower.
Locally on Friday, the ASX200 closed 1.81% lower with all but one major sector closing in the red. Losses were led by the information technology and real estate sectors which fell by 3.04% and 3% respectively. This was offset by the consumer staples sector which gained 0.35% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures predicting a rise of 0.87% at market open this morning.
- On the commodities front this morning,
- Oil is trading over 1% higher at 67 US dollars and 4 cents a barrel as Donald Trump threatened Russia with sanctions if they fail to reach a ceasefire with Ukraine.
- Gold is trading slightly higher by 0.04% at 2911 US dollars an ounce and iron ore is trading 0.05% higher at 101 US dollars and 29 cents a tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Southern Cross Gold Consolidated Ltd (ASX:SX2) with a current share price of $3.60. Bell Potter has set a 12-month price target of $4.80, indicating a share price growth of 33.3%, hence the speculative buy rating is maintained.
- And Trading Central has identified a bearish signal on Westpac Banking (ASX:WBC), indicating that the stock price may fall from a close of $30.57 to the range of $26-$26.90 on a pattern formed over 109 days, according to the standard principles of technical analysis.
Market movements this week were characterised by turbulence in US equities. The ASX200 declined 0.95% Monday to Thursday, with the energy sector weighing down on the market the most, followed by consumer staples and utilities.
In this week’s wrap, Sophia covers:
- (0:45): why defensive stocks have outperformed
- (2:11): shifts in global currency markets
- (2:29): the surge in optimism surrounding the Euro
- (3:16): how the ASX200 performed this week so far
- (3:44): the most traded stocks & ETFs by Bell Direct clients
- (4:08): economic news items to watch out for.
Wall St closed higher overnight following back-to-back losses after an exemption was given to automakers from Donald Trump’s tariffs, giving investors hope that more concessions will be made. The Dow Jones rose 1,14%, the S&P500 jumped 1.12% and the tech-heavy Nasdaq closed Wednesday’s trading session 1.46% higher.
A one-month delay on tariffs were given to automakers whose cars comply with the Unites States-Mexico-Canada agreement. Stellantis rose by 10%, whilst Ford and General Motors both gained 5% and 8% respectively.
Over in Europe, markets closed higher as investors have increased optimism that Donald Trump’s tariffs could be relaxed. The STOXX600 rose by 0.91% with autos rising by 2.4%. This was offset by the utilities and food and beverage stocks which ended the day in negative territory. Germany’s DAX soared 3.38%, the French CAC rallied 1.56% and over in the UK, the FTSE100 fell slightly by 0.04%.
Locally yesterday, the ASX200 fell by 0.69% with the vast majority of major sectors closing in the red. Losses were led by the consumer staples and energy sectors which fell 3.56% and 1.68% respectively. This was offset by the utilities sector which rose by 0.11% by market close.
GDP growth rate data quarter on quarter was released yesterday coming in at a rise of 0.6%, higher than the consensus of 0.5% and the previous result of 0.3%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.21% at market open this morning.
- On the commodities front this morning,
- Oil is trading 2.72% lower at 66 US dollars 40 cents a barrel as OPEC+ supply increases and continued geopolitical tensions weigh on sentiment.
- Gold is trading 0.17% higher at 2919 US dollars an ounce and iron ore is trading 0.79% higher at 101 US dollars and 61 cents a tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Alpha HPA Ltd (ASX:A4N) and has a 12-month share price of $2. With a current share price of $0.87, this indicates a share price growth of 129% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bearish signal on Auckland International Airport Ltd (ASX:AIA), indicating that the share price may fall from the close of $7.30 to the range of $6.60-$6.70, on a pattern formed over 7 days, according to the standard principles of technical analysis.
In the US overnight, Wall Street extended its losing run as fresh tariffs came into effect on Tuesday, US time. The Dow Jones fell by 1.55%, the tech-heavy Nasdaq lost 0.35% and the S&P500 ended the day 1.22% lower. Investors fear the global trade will impact the health of the US economy with retaliatory tariffs from China, Canada and Mexico in motion already.
Over in Europe, markets closed lower as global investors brace for impact on the ongoing tariff war. The STOXX600 closed over 2.14% in the red, it’s biggest daily drop since August last year. Germany’s DAX fell 3.54%, the French CAC lost 1.85% and over in the UK, the FTSE100 closed Tuesday’s trading session down 3.54%.
The local market was sold off broadly yesterday as investor fears of Trump tariff implications spread through the ASX. The key index fell 0.58% as every sector aside from healthcare stocks ended the day in the red, with energy stocks taking the biggest hit with a more than 3% loss.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.97% at market open this morning.
- In terms of economic news, GDP growth rate data will be released for Quarter 4 with a consensus and forecast of a 0.5% increase, 0.2% more than its previous result.
-
On the commodities front this morning,
- Oil is trading 0.85% lower at 67 US dollars and 75 cents a barrel, gold is trading up 0.82% at 2914 US dollars an ounce and iron ore is trading 5.7% lower at 100 US dollars and 81 cents a tonne following the announcement of new US tariffs on Canada, Mexico and China now taking effect.
Trading Ideas:
- Bell Potter maintains a buy rating on Develop Global (ASX:DVP) and has a 12-month price target of $4. With a current share price of $2.93, this indicates a share price growth of 36.5% over the next 12 months, hence the buy rating is maintained.
- Trading Central has identified a bearish signal on NAB (ASX:NAB), indicating that the stock price may fall from the close of $35.05 to the range of $28.50-$29.75 on a pattern formed over 8 days, according to the standard principles of technical analysis.
Wall St started the new trading week sharply lower as investors brace for the impact of Trump’s tariffs on Mexico and Canada, of which come into effect on Tuesday US time. The Dow Jones fell 2.1%, the S&P500 lost 2.3% and the tech-heavy Nasdaq ended the day down a sharp 3.2%. Investor hopes of a last-minute deal to prevent the tariffs from going ahead were dashed in afternoon trade after President Trump reiterated the 25% levies on imports from Mexico and Canada will go ahead from Tuesday. Companies that face a direct hit from the tariffs tumbled yesterday including Ford and General Motors.
Over in Europe on Monday, markets closed higher as defence stocks continue to surge amid renewed spend in the sector. The STOXX 600 rose 1.1%, Germany’s DAX rose 2.6%, the French CAC added 1% and, in the UK, the FTSE 100 ended the day up 0.7%.
Across the Asia region on Monday, markets mostly rose as investors awaited clarity on Trump’s tariff plans. Japan’s Nikkei rose 1.7%, Hong Kong’s Hang Seng rose 0.44%, Taiwan’s Taiex index fell 1.3% and China’s CSI index closed down just 0.04%.
Locally on Monday the ASX started the new trading month in the green with the key index posting a 0.9% rise at the closing bell and all sectors ended the day higher led by Energy stocks rising 2.02%. The positive market sentiment comes ahead of a wave of tariff implications out of the US commencing this week which is set to shake up market returns and outlook, while we are also bracing locally for the latest slew of economic data with the GDP reading out later in the week. The energy rally on Monday was amid investor outlook for the price of oil to rise when tariffs on Mexico and Canada come into effect as they are two major exporters of crude.
Embattled casino operator Star Entertainment Group shares were suspended on Monday following a trading halt after the company failed to lodge accounts to the ASX for reporting season.
Medical imaging giant Pro Medicus jumped 3.2% on Monday after the company signed yet another deal to roll out its core imaging tools. The deal worth $40m is with US radiology provider LucidHealth and will see Pro Medicus devices and systems rolled out throughout the LucidHealth network.
What to watch today:
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 1.35% following Wall Street’s tumble overnight.
- On the commodities front this morning oil is trading 2.3% lower at US$68.16/barrel, gold is up 1.11% at US$2888.53/ounce and iron ore is down 0.21% at US$106.90/tonne.
- The Aussie dollar has weakened against the greenback to buy US$0.62, 92.84 Japanese Yen, 49.13 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has maintained a buy rating on Harvey Norman (ASX:HVN) and have raised the 12-month price target on the home goods giant to $6.00/share following the release of 1H25 results including some key beats in the Australian franchising division and also in the NZ operations. Single digit earnings growth across most metrics was reported and the analyst increased the 12-month price target due to multiple catalysts near-mid-term such as improving sales trends and the growing AI movement.
- And Bell Potter has slightly increased the 12-month price target on Bub’s Australia (ASX:BUB) to 15.5cps and maintain a hold rating on the infant formula producer following the release of the company’s 1H25 results including net revenue growth of 24% to $48.5m, EBITDA of $0.5m compared to a loss of $6.8m in the PCP, and outlook for net revenue target for FY25 of $102m. The analyst sees Bub’s continues to make inroads into the US however remains cognisant of the potential impact of tariffs (if any).
Over in Wall St on Friday markets closed higher to end the week following a losing month for the major averages. The Dow Jones gained 1.39%, the S&P 500 jumped 1.59% and the tech-heavy Nasdaq rose by 1.63%.
Over in Europe, the STOXX600 and Germany’s DAX closed flat on Friday, with the French CAC rising 0.1% and over in the UK, the FTSE 100 ended 0.61% higher by market close on Friday.
Locally on Friday, the ASX200 fell 1.16% with all but one major sector closing in the red. Losses were led by the information technology and materials sectors which fell 2.86% and 2.47% respectively. This was offset by the communication services sector which rose by 0.24% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.59% at market open.
-
On the commodities front this morning,
- Oil is trading 0.84% lower at 69 US dollars and 76 cents a barrel, marking the first monthly decline since November over geopolitical tensions.
- Gold is trading 0.65% lower at 2856 US dollars an ounce, and iron ore is trading 0.16% lower at 106 US dollars and 90 cents a tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Aeris Resources (ASX:AIS) and has a 12-month price target of $0.30. The speculative buy rating is maintained as AIS is a copper dominant producer with all its assets in Australia. It’s near-term outlook is highly leveraged to the copper price and increasing grades and production at the Tritton copper mine. Successful delivery offers significant upside and a strategically attractive asset in Tritton, hence the buy rating is maintained.
- Trading Central has identified a bearish signal in Goodman Group (ASX:GMG), indicating that the share price may fall from the close of $31.31 to the range of $23.25-$24.75, on a pattern formed over 212 days, according to the standard principles of technical analysis.
In the final week of reporting season, the ASX200 declined 0.34%, as technology stocks tumbled, while utilities and financial stocks offset some of the local market gains. This reporting season, 24 companies released their financial results, with 86 beatings expectations, 83 meeting expectations and 75 missing expectations. 37 companies have been upgraded by brokers, while 42 have been downgraded.
In this week’s wrap, Sophia covers:
- (0:42): why Qantas continues to soar as turbulence rocks other airlines
- (1:13): Light & Wonder’s share price reaching records
- (1:55): differing investor reactions to the results of Woolworths & Coles
- (2:56): the best & worst performing stocks & ETFs this week
- (3:58): the most traded stocks by Bell Direct clients
- (4:22): economic news items to watch out for.
Wall St overturned its recent red run to close higher on Wednesday as investors overlooked concerns around Trump’s tariffs and into areas of opportunity in the market. The S&P500 rose 0.01%, only just snapping a 4-day losing streak, while the Nasdaq gained 0.26% and the Dow Jones ended the day up 0.43%.
Nvidia’s results out overnight boosted the AI-market darling up 3% ahead of the results release after the closing bell. Nvidia’s results once again beat expectations with sales growing 78%, revenue coming in at US$39.33bn and EPS rose to US$0.89/share. The outlook is also very strong for revenue of US$43bn in Q1 as global demand for AI drives tailwinds for the company.
European markets ended the midweek session higher amid strong corporate earnings beats across the region. The STOXX 600 rose 0.99%, Germany’s DAX rose 1.73%, the French CAC added 1.15%, and, in the UK, the FTSE100 ended the day up 0.72%. Earnings from Budweiser maker AB Inbev, Adecco, and Munich Re each rallied yesterday after reporting earnings beats.
Across the APAC region on Wednesday, markets closed mixed taking lead from Wall St on Tuesday and amid key pledges out of governments in the region. Hong Kong’s Hang Seng rose 3.63% led by tech stocks after the city pledged in its budget to develop itself into an AI hub. Japan’s Nikkei fell 0.25%, and South Korea’s Kospi index rose 0.41%.
Locally on Wednesday the ASX200 fell 0.14%, weighed down by the materials sector falling 1.61%, while Real Estate stocks fell 1.3%. Energy and Financials stocks offset some of the market losses with gains of 1.3% and 0.71% respectively.
Bapcor rallied over 13% yesterday after the leading provider of aftermarket parts, accessories and services released strong first half results including strong cost reduction plans to increase cash conversion which has enabled the company to bay down debt and reinvest in growth plans this financial year to date.
Light & Wonder also rose over 7% after the gaming company reported FY24 results including a 10% rise in revenue to a record $3.2bn, a 110% jump in net income to $336m and guided to low double-digit income growth for Q1FY25.
What to watch today:
- Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.12%.
- On the commodities front this morning oil is trading 0.16% lower at US$68.82/barrel, gold is down 0.07% at US$2916/ounce and iron ore is down 0.02% at US$107.17/tonne.
- The Aussie dollar has slightly weakened against the greenback overnight to buy 63.03 US cents, 93.98 Japanese Yen, 49.89 British Pence and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Bell Potter has slightly decreased the 12-month price target on Kogan.com (ASX:KGN) from $5.10 to $5.00 and maintain a hold rating on the online retailer following a 1H result that came in line with expectations. The slight decrease in 12-month price target is due to earnings downgrades by the analyst as Kogan’s Mighty Ape business had some transition issues post a website upgrade last year.
- Bell Potter has downgraded the price target on Woolworths (ASX:WOW) from $31.75 to $30.75 and maintain a hold rating on the leading supermarket giant after the company reported first half results below BPe on an NPAT front and provided softer near-term guidance.
As we enter into the 4th week of Reporting Season, we have seen 174 companies release results with 61 beating expectations, 62 meeting expectations and 51 missing expectations.
In this weeks video, Grady covers:
- Domino’s (ASX:DMP): Dropped 9% after a $20m loss, impacted by cost pressures and store closures
- Johns Lyng Group (ASX:JLG): Plunged 28% as project delays and weak insurance claims hit earnings
- Zip Co (ASX:ZIP): Jumped 15% on record first-half results, with cash earnings up 120% and US growth surging
- Woodside (ASX:WDS): NPAT doubled to $3.6bn, but underlying profit slipped 14% on weaker oil and gas prices.
Over in the US on Tuesday, Wall St closed mostly lower following the release of the most recent consumer confidence survey that came in much weaker than expected. The S&P500 fell 0.47% for its fourth consecutive losing session while the Nasdaq declined 1.35%, but the Dow Jones ended the session up 0.37%. Escalating trade tensions are also weighing on investor sentiment and contributing to market uncertainty as investors weigh up the impacts of Trump’s tariffs on Mexico and Canada which are set to be imposed next week.
In Europe overnight, markets closed mixed in the region as corporate earnings and defence spend in the region remain a key focus for investors. The STOXX 600 rose 0.15%, Germany’s DAX lost 0.13%, the French CAC fell 0.49%, and in the UK, the FTSE 100 ended the day up 0.11%.
Across the APAC region on Tuesday, markets closed lower as investors await the full impact of Trump’s tariffs on the region. Japan’s Nikkei lost 1%, South Korea’s Kospi Index lost 0.57% after South Korea’s central bank unexpectedly cut rates in a bid to stimulate the slowing economy, and Hong Kong’s Hang Seng lost 1.32%.
The local market reversed Monday’s gain to close 0.68% lower on Tuesday as a sharp sell-off in tech and discretionary stocks offset gains among utilities and staples stock. Investors have been very reactive to reporting season updates whilst also keeping an eye on valuations and movements out of the US, especially on the tariffs front.
We had a slew of corporate results out yesterday that sparked mixed reactions among investors with sharp rises and falls reported in key share prices. Domino’s Pizza shares tumbled over 10% after the leading global pizza maker swung to a loss in the first half amid $116m in one-off store closure related costs due to the company closing 205 loss-making stores.
Johns Lyng Group was the worst performer yesterday with shedding over a quarter of its value as the share price plummeted over 30% after the company downgraded group earnings guidance. The building and restoration services provider across Aus and the US faced a challenging operating environment especially in Australia with benign weather conditions reducing the volume of insurance claims, while the US had project commencement delays impacting performance.
And on the other hand, 2024 market darling Zip Co soared 14% yesterday on impressive 1H results including total transaction value up 23.9% to $6.2bn, lower bad debts, cash earnings more than doubling, increased growth in the US market and the company launched into the personal loans market in January.
What to watch today:
- Ahead of the midweek session on the ASX, the SPI futures are anticipating the ASX will open the day down 0.30% tracking Wall Street’s lower session overnight.
- On the commodities front this morning oil is trading 2.7% lower at US$68.83/barrel, gold is down 1.58% at US$2903/ounce and iron ore is up 0.06% at US$107.19/tonne.
- The Aussie dollar has weakened against the greenback to buy US$0.63, 94.39 Japanese Yen, 50.16 British Pence and 1 NZ$1.11 cents.
Trading Ideas:
- Bell Potter has slightly decreased the 12-month price target on Adairs (ASX:ADH) from $2.85 to $2.65 but maintain a buy rating on the leading furniture retailer following the release of the company’s first half results including revenue growth of 6.6% which was a good improvement from the last trading update however, the company’s Focus on Furniture brand continues to weigh on results.
- And Trading Central has identified a bearish signal on Praemium (ASX:PPS) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may fall from the close of $0.78 to the range of $0.73 to $0.75 according to standard principles of technical analysis.
Wall Street started the new trading week lower, extending on Friday’s sharp inflation-data driven sell-off as many of the major tech companies come under pressure amid concerns over weakness in data centre spend and overvaluation in the space. The S&P500 lost 0.5% on Monday, the Nasdaq fell 1.21% and the Dow Jones ended the day down 0.08%. Trump tariffs are also weighing on investor sentiment at present after Trump said tariffs on Canada and Mexico will ‘go forward’ after the monthlong postponement ends next week.
In Europe overnight, markets mostly fell as investors reacted to the results of the German federal election. The STOXX 600 fell 0.08%, Germany’s DAX rose 0.62%, the French CAC lost 0.78% and, in the UK, the FTSE100 ended the day flat.
Shares in leading global on-demand food delivery company Just Eat Takeaway soared 54% after tech investor Prosus announced its plans to acquire the company in a deal worth $4.3bn.
Across the APAC region on Monday markets mostly fell taking lead from Wall Street’s worst session of the year last Friday after fresh inflation data in the US pointed to a slowing economy and sticky inflation. China’s CSI index fell 0.22%, Hong Kong’s Hang Seng fell 0.58%, South Korea’s Kospi index lost 0.35% and Japan’s Nikkei was closed for a holiday.
Locally to start the week, the ASX200 posted a 0.14% rise at the closing bell as strong gains for utilities and financial stocks more than offset the 6.84% tumble in tech stocks.
Logistics software solutions provider WiseTech Global was the driver of the tech plummet yesterday as shares in the company dived 20.09% following news that four directors on the company’s board quit over founder Richard White’s ongoing role with the company.
NIB Holdings on the other hand rose 12.5% after the company reaffirmed guidance for FY25 profits between the range of $235 - $250m as it focuses on a return to profitability for its New Zealand business.
And EVT shares posted the greatest gain on the market yesterday with a rise of 12.88% after the property developer and operator posted a strong first half result including profits up 8.3% YoY which beat estimates by 83% driven by the company’s hotel division achieving record earnings during the period.
What to watch today:
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down a sharp 0.76% tracking Wall Street’s sell-off overnight.
- On the commodities front this morning, oil is trading 0.68% higher at US$70.88/barrel, gold is up 0.61% at US$2952/ounce and iron ore is up 0.12% at US$107.13/tonne.
- The Aussie dollar has strengthened against the greenback to buy US$0.63, 95.04 Japanese Yen, 50.03 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has downgraded the rating on Domain (ASX:DHG) following the announcement of US property giant CoStar making a $2.7bn takeover bid for the real estate platform. Nine Entertainment Co has a 60% controlling stake in Domain which remains a block for the acquisition, but Bell Potter’s analyst sees the takeover bid as attractive.
- And Trading Central has identified a bullish signal on Rural Funds Group (ASX:RFF) following the formation of a pattern over a period of 33-days which is roughly the same amount of time the share price may rise from the close of $1.79 to the range of $1.88 to $1.90 according to standard principles of technical analysis.
As we enter the final week of reporting season, the Australian market is set to open in the red, following the Dow Jones dropping 700 points on Friday in the US, the worst day for the Dow this year so far. This comes from the release of soft US data, including a decline in consumer sentiment, home sales dropping more than expected and a five-year inflation outlook survey higher-than-expected. The economic data sparked concerns among US investors over a slowing economy and sticky inflation. Bank stocks were sold off and losses advanced toward the close on Friday, amid news headlines of additional tariffs and other government policies moving markets.
The Dow Jones dropped 1.67%, bringing its two-day losses to 1,200 points. The S&P500 dropped 1.71%, the second negative session for the index after closing at a record on Wednesday. And the tech- heavy Nasdaq declined by over 2%.
Australian shares declined on Friday, down 0.32% with consumer discretionary stocks weighing down on the market the most, while the materials sector advanced.
What to watch today:
- As we enter the final week of reporting season, the Australian market is set to open lower, with the SPI futures suggesting a drop of 0.77% at the open this morning, following US equities.
- In commodities,
- Crude oil has dropped 2.87%, trading at US$70.40 per barrel, as concerns over Russian supply disruptions provided support while uncertainty loomed over a potential Ukraine peace deal.
- Gold is trading slightly lower at US$2,934 an ounce, remaining close to its record high from the previous session at US$2,950. Investors moved to the safe haven metal amid rising global uncertainties.
- And iron ore is trading higher at US$107.13 per tonne, its highest in four months amid strong demand expectations from major consumers.
- Over 20 listed companies are set to report their earnings results today, including Adairs (ASX:ADH), APA Group (ASX:APA), Lovisa (ASX:LOV), Lynas Rare Earths (ASX:LYC) and Regis Healthcare (ASX:REG), just to name a few.
- Stocks going ex-dividend today include Hansen Technologies Limited (ASX:HSN), Santos (ASX:STO) and Vicinity Centres (ASX:VCX). Remember that this often sees share prices fall, as investors take their profits.
Trading Ideas:
- Bell Potter have upgraded their recommendation on Telix Pharmaceuticals (ASX:TLX) from a Hold to a Buy after the pharmaceutical group pre-released FY24 revenues. Bell Potter’s 12- month price target is amended from $21.60 to $36.00, and at TLX’s current share price of $30.12, this implies just over 19% share price growth in a year.
- Trading Central have identified a bearish signal in PWR Holdings (ASX:PWH) indicating that the stock price may fall from the close of $7.34 to the range of $5.20 - $5.70 over 67 days, according to the standard principles of technical analysis.
With reporting season nearing its end, 84 companies have released results. Of these, 30 exceeded expectations, 27 met them, and 27 fell short. Wesfarmers and Universal Stores were among the companies surpassing expectations this week, while Super Retail Group was among those that missed. Also check out how the ASX performed this week.
In this week’s wrap, Grady covers:
- (0:38): WesCEF driving Wesfarmers’ results
- (1:40): the excellent results from Universal Stores
- (2:27): inflationary pressures impacting Super Retail Group
- (3:36) the dividend focus in February’s earnings season
- (5:19): how the ASX200 performed this week so far
- (6:17): the most traded stocks & ETFs by Bell Direct clients
- (6:47): economic news items to watch out for.
Wall St closed higher overnight as the S&P closed at a record for the second day in a row. The Dow Jones gained 0.16%, the tech-heavy Nasdaq rose 0.07% and the S&P500 jumped 0.24%.
Over in Europe, markets plummeted on Wednesday as earnings season results disappoint investors. The STOXX600 fell 0.9%, pulling from the all time high set in Tuesday’s trading session. Germany’s DAX dropped 1.8%, the French CAC lost 0.62% and over in the UK, the FTSE100 closed Wednesday’s trading session 1.8% in the red.
Locally yesterday, the ASX200 closed 0.73% lower with the majority of sectors closing down. Losses were led by the energy and financial sectors which dropped by 2.35% and 2.01% respectively. This was offset by the utilities sector which gained 0.84% by market close.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.45% at market open this morning.
- In terms of economic news today, Australian unemployment data for January will be released with a forecast of 4%, the same as its previous result.
- On the commodities front this morning,
- Oil is trading 0.63% higher at 72 US dollars and 25 cents a barrel, gold is trading flat at 2934 US dollars an ounce and iron ore is trading 0.08% lower at 106 US dollars and 74 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Ceder Woods Properties (ASX:CWP) with a 12-month price target of $7.20. With a current share price of $5.53, this indicates a share price growth of 25.2% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU), indicating that the stock price may rise from the close of $2.86 to the range of $3.30-$3.40 on a pattern formed over 105 days, according to the standard principles of technical analysis.
As we enter into the 3rd week of Reporting Season, many companies have released results that have defied odds despite strong headwinds and inflationary pressures.
In this weeks video, Grady covers:
- BlueScope Steel (ASX:BSL): Shares rallied 13% despite a 57% drop in H1 EBIT, with H2 earnings guidance suggesting at least 16.5% growth.
- A2 Milk (ASX:A2M): Soared 19%, with a strong 10.1% revenue increase and an inaugural 8.5 NZ cps dividend.
- LendLease (ASX:LLC): Posted a strong 122% rise in operating profit, though net debt grew to $3.8bn.
- BHP (ASX:BHP): Revenue down 8%, but copper boosted results. The 30% cut in interim dividend disappointed.
Wall St closed higher overnight as the S&P 500 sets a new record high, climbing 0.24%. The Dow Jones rose just 0.02% and the tech-heavy Nasdaq had a slight rise of 0.07%. The energy sector was the best performing, gaining 1.9% with Halliburton and Valero Energy leading gains.
Over in Europe, markets closed higher as the STOXX600 jumped 0.32% by market close on Tuesday. Germany’s DAX had a gain of 0.2%, the French CAC rallied 0.21% and over in the UK the FTSE100 had a slight fall of 0.01% by the closing bell.
Locally yesterday the ASX had a pullback to start the week, closing Tuesday’s session down 0.66% despite the RBA announcing the nation’s first cash rate cut since November 2020 after 13-hikes to 4.35%. The nations cash rate now drops 25-basis points to 4.1% as the RBA’s journey to tame inflation is working at the same time the elevated rate environment to date has caused a cost-of-living crisis in Australia.
What to watch today:
- The Australian share market is set to open slightly lower, with the SPI futures suggesting a fall of 0.02% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.55% higher at 71 US dollars and 77 cents a barrel after crude exports from Kazakhstan were disrupted after a drone strike hit a Russian pumping station, potentially cutting pipeline flows by 30%.
- Gold is trading 1.2% higher at 2934 US dollars an ounce and iron ore is trading 0.06% higher at 106 US dollars and 83 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on HUB24 (ASX:HUB) and has increased its 12-month price target to $93. With a current share price of $84.39, this indicates a share price growth of 10.2% over the next 12-months, hence the buy rating is maintained.
- Trading Central has identified a bearish signal on Appen Ltd (ASX:APX), indicating that the stock price may fall from the close of $2.90 to the range of $1.90-$2.10, on a pattern formed over 30 days, according to the standard principles of technical analysis.
Welcome to another episode of our Macro Insights series! Today, the RBA made a highly anticipated move, cutting the cash rate by 25bps, bringing it to 4.10% from 4.35%. This marks the first rate cut in over four years after a series of 13 hikes aimed at curbing inflation.
While inflation drivers remain sticky, this rate cut should ease cost-of-living pressures for Aussies, though the full effects will take time to trickle through the economy.
Here’s a quick snapshot of the latest data that influenced today’s decision:
- Inflation: Annual inflation dropped to 2.4% (Q4 2024), but services inflation remains high at 4.3%.
- Labour Market: Unemployment rose to 4%, but 256k jobs were added, reflecting a strong labour market.
- Retail Sales: Consumer spending fell 0.1% in December, signalling easing inflationary pressures.
- GDP: Q3 2024 GDP expanded 0.3%, below expectations.
The sectors most likely to benefit from this cut? Tech, Healthcare, and Real Estate – all poised for relief in a lower-rate environment.
Wall street was closed on Monday for the President’s Day holiday.
Over in Europe on Monday markets closed higher as several defence stocks soared amid renewed spend in the defence space in the region. The STOXX 600 rose 0.54% to a fresh record high, while Germany’s DAX added 1.26%, the French CAC climbed 0.13%, and, in the UK, the FTSE 100 ended the day up 0.41%.
Across the Asia region on Monday, markets closed mostly higher as investors digested Japan’s latest GDP reading which came in at a Q4 expansion of 2.8%, exceeding market estimates of 1% growth. Japan’s Nikkei added 0.06% on Monday, Hong Kong’s Hang Seng fell 0.02%, China’s CSI index rose 0.21% and South Korea’s Kospi index ended the day up 0.75%.
The local market was sold off yesterday, ending the day down 0.2% as the banks weighed on market gains after Westpac posted a 9% drop in net profit for Q1, while investors remain cautious ahead of the RBA’s first meeting for 2025 starting today. The market is factoring in a 90% chance of a rate cut today, however, economic data shows inflation and key drivers of inflation remain sticky so the announcement out of the RBA will be highly anticipated this afternoon, in addition to the outlook for the rate journey.
Gold miners saw significant sell-offs after the precious metal experienced its largest single-day drop on Friday. Northern Star Resources dropped 3.5%, Bellevue Gold lost 3.16% and Evolution Mining ended the day down 2.05%.
On the other hand, payment provider Findi saw a strong rally, up 7.3%. This surge came after the company narrowed its earnings forecast for fiscal 2025, now expecting earnings before tax to fall between $30 million and $32 million, compared to the earlier range of $30 million to $35 million.
Better-than-expected earnings boosted a2 Milk by 19.7% on Monday with the company reporting a 10.1% rise in revenue, NPAT up 7.6% to NZ$91.7m and A2M also declared an inaugural dividend of 8.5 NZ cps.
A sharp rise in US steel prices since President Trump commenced his term in office, boosted BlueScope Steel’s outlook in results out yesterday. Shares in Australia’s largest steelmaker rose almost 13% on Monday despite the company reporting a 57% slide in underlying EBIT and NPAT down 59%.
What to watch today:
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX will open the day up 0.25%.
- On the commodities front this morning, oil is trading 0.91% higher at US$71.38/barrel, gold is up 0.78% at US$2903/ounce and iron ore is up 0.06% at US$106.83/tonne.
- The Aussie dollar has further strengthened overnight to buy US$0.63, 96.30 Japanese Yen, 50.52 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Chalice Mining (ASX:CHN) from $5.15 to $5.75 and maintain a speculative buy rating on the platinum, nickel, copper and cobalt miner following metallurgical test work breakthrough at the company’s 100%-owned Gonneville Project demonstrating two saleable, smelter grade flotation concentrated can be produced across the entire Gonneville Sulphide resource.
- And Trading Central has identified a bullish signal on Dalrymple Bay Infrastructure (ASX:DBI) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may rise from the close of $3.65 to the range of $3.96 to $4.04 according to standard principles of technical analysis.
The local market closed 0.2% higher on Friday, buoyed by a strong rally for the consumer staples sector amid strong results out of TWE and investors buying up the supermarket giants on Friday. For the week, the ASX posted a gain of 0.52% as industrials and the consumers stocks rallied, while healthcare stocks took a 3.75% hit over the 5-trading days.
Reporting season ramped up on Friday with Avita Medical soaring 11% after the company announced a guidance range of $158m to $167m for commercial revenues in 2025, while GQG rose 5.9% after doubling net inflows to the half year to December.
Hearing device specialist Cochlear on the other hand fell 13% on Friday after downgrading profit guidance for FY25 due to weaker services contribution and increased cloud-related investment, despite the company posting a 5% rise in sales in H1 to $1.17bn.
In the US on Friday, markets closed mixed on Friday despite investors gaining certainty around Trump’s tariff plans and fresh economic data signalling the US inflation story is not running hot as was previously feared. The Dow Jones fell 0.4%, the S&P500 fell just 0.01% and the Nasdaq ended the day up 0.41%. For the week, each of the major averages posted a gain. The latest US inflation reading out last week showed core inflation rose more than expected in January by 0.4% MoM, and 3.3% YoY, while the overall inflation rate rose to 3% YoY, while retail sales in the US fell 0.9% in January MoM, which was more of a decline than the markets were expecting.
Across the European region on Friday, markets pulled back from record highs earlier in the week. The STOXX fell 0.24%, Germany’s DAX lost 0.44%, the French CAC rose 0.18%, and, in the UK, the FTSE100 ended the day down 0.37%.
Asia markets closed mixed on Friday as investors assessed President Trump’s reciprocal tariff plans but did not enact levies immediately. China’s CSI index rose 0.87%, Hong Kong’s Hang Seng rose 3.48%, South Korea’s Kospi Index gained 0.31%, and Japan’s Nikkei fell 0.79%.
What to watch today:
- Ahead of Monday’s session on the ASX, the SPI futures are anticipating the local market will open the day down 0.61%.
- On the commodities front this morning, oil is trading 0.77% lower at US$70.74/barrel, gold is down 1.73% at US$2880.76/ounce and iron ore is up 0.06% at US$106.83/tonne.
- The Aussie dollar has strengthened against the greenback to buy US$0.63, 96.63 Japanese Yen, 50.47 British Pence and NZ$1.11.
- On the reporting season calendar today, Aurizon, Bendigo and Adelaide Bank, BlueScope Steel, Lendlease Group and A2 Milk will release results.
Trading Ideas:
- Bell Potter has upgraded Pro Medicus (ASX:PME) from a hold to a buy rating and have increased the 12-month price target on the leading diagnostic imaging healthcare provider following the release of the company’s first half results. Despite PME reporting a small miss on earnings, the outlook remains strong and with 10 contract announcements and strong growth in the cardiology space expected, the analyst sees strong upside potential for the company in H2.
- And Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 52-days which is roughly the same amount of time the share price may rise from the close of $4.42 to the range of $4.68 and $4.74 according to standard principles of technical analysis.
Australian companies are reporting mixed results this earnings season, with some exceeding expectations like CBA and Suncorp, while others, such as AGL, have fallen short. CBA's strong profit and Suncorp's boosted earnings from lower natural hazards led to positive investor reactions, while Evolution Mining saw significant profit growth in the gold sector. Next week promises a busy earnings calendar with major companies like BHP and Rio Tinto reporting.
In this week’s wrap, Grady covers:
- (0:25): the results that saw CBA rally
- (1:30): why insurance companies posted positive earnings
- (2:38): Evolution Mining’s strong performance
- (4:19): why AGL’s financial results took a hit
- (6:16): how the ASX200 performed this week so far
- (7:02): the most traded stocks & ETFs by Bell Direct clients
- (7:34): economic news items to watch out for.
Wall St closed lower overnight following a hotter-than-expected CPI report. The Dow Jones lost half a percent, the S&P 500 dropped 0.27% and the tech heavy Nasdaq had a slight rise of 0.03%. January’s consumer price index jumped 0.5% for the month, putting the annual inflation rate at 3%, more than the 0.3% rise expected by economists in January.
Over in Europe, markets closed higher as earnings season continues. The STOXX600 ended Wednesday’s trading session 0.11% higher, Germany’s DAX rose half a percent, the French CAC jumped 0.17% and over in the UK the FTSE100 closed 0.34% in the green.
Locally yesterday, the ASX200 gained 0.6% with the majority of sectors closing in the green. Gains were led by the industrial and financial sectors which gained 1.93% and 1.41% respectively. This was offset by the information technology sector which fell 1.05% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.04% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.79% lower at 71 US dollars and 27 cents a barrel, gold is trading 0.13% higher at 2902 US dollars an ounce, and iron ore is trading 0.61% lower at 106 US dollars and 32 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Perpetual Limited (ASX:PPT) with a 12-month price target of $25.40. With a current share price of $22.50, this indicates a share price growth of 12.9%, hence the buy rating is maintained.
- Trading Central has identified a bearish signal on Kelsian Group (ASX:KLS), indicating that the stock price may fall from the close of $3.53 to the range of $3.23-$3.29, on a pattern formed over 20 days according to the standard principles of technical analysis.
With Reporting Season in full swing, investors continue to digest all the latest reports from the companies reporting their earnings.
Strong results from companies in the healthcare space such as ResMed (ASX:RMD) and Ansell (ASX:ANN) impressed investors. How did JB Hi-Fi (ASX:JBH) post strong results despite strong headwinds? Why did CSL’s (ASX:CSL) latest report disappoint investors.
Catch all the latest updates with Bell Direct to help you find your investing edge.
Over in the US so far on Tuesday, Wall Street closed mixed as Fed Chair Jerome Powell signalled concerns over the direction of the US economy amid US tariffs and the possibility of a global trade war. The Dow Jones climbed 0.1% while the S&P500 and Nasdaq dropped 0.2% and 0.6% respectively.
In Europe overnight, markets closed higher as investors digested the latest Trump tariff announcements and The European Union plans to retaliate against the US for new steel and aluminium tariffs. The STOXX 600 rose 0.23%, Germany’s DAX added 0.56%, the French CAC gained 0.28% and, in the UK, the FTSE100 ended the day up 0.11%.
Across the APAC region on Tuesday, markets closed mixed as investors continued digesting the impacts and flow on effects of Trump’s latest tariffs. Hong Kong’s Hang Seng fell 1.06%, and China’s CSI index fell 0.46%, while South Korea’s Kospi Index rose 0.71% and Japan’s markets were closed for a holiday.
The local market started the new trading week lower on Monday before a choppy session that led to a flat close on Tuesday as a sharp sell-off in healthcare stocks weighed on the local index.
Trump tariffs continue to dampen investor sentiment and fuel investor and central bank demand for gold stocks, bullion and exposure in portfolios given the safe-haven nature of the precious commodity at a time where economic and market certainty is unclear.
CSL’s results for the first half out yesterday weighed on the local market and healthcare sector as the healthcare giant fell nearly 5% yesterday despite beating expectations for 2 of the company’s 3 divisions. The company’s Behring business, which manufactures plasma products and provides collection services in the US, Australia, Europe and more, reported a strong first half with revenue up 10% and gross margin of 51.1% which beat expectations by 20bps. Investors likely sold out of the company amid warnings of FX headwinds to come in H2 and after the Seqirus division posted a 9% decline in revenue on the PCP.
Gold miners rocketed again yesterday as the price of the precious commodity jumped over US$2900/ounce for the first time amid increased demand out of central banks and from investors due to the haven nature of the commodity in a time of great uncertainty.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.02%.
- The Aussie dollar has further strengthened against the greenback to buy US$0.62, 95.87 Japanese Yen, 50.70 British Pence and 1 NZ$1.11 cents.
- On the commodities front this morning, oil is trading 1.21% higher at US$73.19/barrel, gold is down 0.38% at US$2906/ounce and iron ore is up 0.56% at US$106.97/tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on CSL (ASX:CSL) but have lowered the 12-month price target from $345 to $335 following the release of the company’s first half results showing revenue rose 5% but fell 1% short of BPe and NPATA rose 3% but was 4% below BPe. The analyst maintains a buy rating as the Behring division continues its strong growth outlook and positive margin recovery despite the Seqirus division facing headwinds of declining vaccine demand in the US.
- And Trading Central has identified a bullish signal on QBE Insurance Group (ASX:QBE) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may rise from the close of $20.43 to the range of $21.90 to $22.20 according to standard principles of technical analysis.
Wall St started the week in positive territory as investors looked past Trump’s latest tariff talks about a blanket tariff on steel and aluminium imports, and bought into growth areas of the market. The Dow Jones rose 0.38%, the S&P500 added 0.67% and the tech-heavy Nasdaq led the gains with a near 1% rise.
Strength in the US jobs market dampened investor hopes of a near-term rate cut as the latest unemployment data showed the jobless rate in the world’s largest economy fell from 4.1% to 4% in January at the same time 143,000 jobs were added. The Fed has already cut the US cash rate once last year to 4.25% - 4.5%, however, with signals of a stronger labour market, a rise in the inflation rate for the last 3-months and strong retail sales growth, the US central bank is unlikely to cut rates again until these inflationary driver’s ease.
In Europe overnight markets in the region started the new trading week higher with the STOXX 600 gaining 0.58%, while Germany’s DAX added 0.57%, the French CAC rose 0.42% and, in the UK, the FTSE100 ended the day up 0.77%.
Across the APAC region on Monday, markets closed mixed as escalating tensions around Trump’s tariff implications weighed on investor sentiment. Japan’s Nikkei closed flat, South Korea’s Kospi index also ended the day little unchanged, Hong Kong’s Hang Seng rose 1.76% and China’s CSI index rose 0.21% after China’s consumer inflation rose to a 5-month high in January amid higher consumer spend in the lead up to the Lunar New Year.
Locally on Monday, the ASX200 started the new trading week in the red with a 0.34% loss at the closing bell as a sharp sell-off in tech stocks weighed on the local key index.
Reporting season continued on Monday with key names releasing first half results that surprised investors. Trump’s new tariffs on aluminium and steel weighed on the local index early in the session before realising that less than 1% of China’s steel exports went to the US in 2024, and China is Australia’s largest buyer of iron ore which is a key ingredient used to make steel.
JB Hi-Fi faced inflationary pressures and subdued demand in the first half but still posted strong results, with total sales rising 9.8% to $5.67bn, NPAT up 8% to $285.4m, and an interim dividend increase of 7.6% to 170cps. However, investors sold off shares, likely due to a 13.5% rise in inventory and a 9bps drop in inventory turnover. Payables also increased by 16% YoY in H1. CEO Terry Smart’s cautious remarks about retail market uncertainty and heightened competition likely spooked investors yesterday.
Ansell on the other hand had investors buying in on Monday after the global leading protective equipment producer released strong first half results including sales growth of 12.5%, EBIT up 20.9% and a dividend of 22 US cps.
What to watch locally today:
- Ahead of Tuesday’s trading session on the ASX the SPI futures are anticipating the ASX to open the day up 0.37% tracking Wall Street’s positive start overnight.
- On the local reporting season calendar today, we will likely see investors react to results out of global healthcare giant, CSL.
- On the commodities front this morning, oil is trading 2.02% higher at US$72.44/barrel, gold is up 1.68% at US$2907.41/ounce and iron ore is up 0.13% at US$106.37/tonne.
- The AUD has strengthened against the greenback to buy US$0.62, 95.29 Japanese Yen, 50.73 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has downgraded the rating on JB Hi-Fi (ASX:JBH) from a buy to a hold and have increased the 12-month price target on the leading tech retail company from $98 to $99/share following the release of the company’s results yesterday. The downgrade to a hold follows the analyst believing JB is currently well valued and limited earnings upgrades in the near-term are priced in at a current PE multiple of around 23x.
- And Trading Central has id
Wall St closed 400 points lower on Friday as inflation and tariff concerns worried investors towards the back end of the week. The Dow Jones fell 1, the S&P500 dropped 0.95% and the tech heavy Nasdaq lost 1.36%.
Over in Europe, markets followed the US and closed lower as corporate earnings continue to roll out. The STOXX600 fell 0.38% after a key US jobs report disappointed investors. Germany’s DAX lost over half a percent, the French CAC dropped 0.43% and over in the UK, the FTSE100 ended Friday’s trading session 0.31% in the red.
Locally on Friday, the ASX200 closed 0.11% lower with half of the sectors closing in negative territory. Losses were led by the energy and health sectors which lost 1.45% and 1.03% respectively. This was offset by the information technology sector which gained over half a percent.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.76% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.55% higher at 71 US dollars a barrel, gold is trading 0.05% higher at 2859 US dollars an ounce and iron ore is trading 0.13% higher at 106 US dollars and 37 cents a tonne.
Trading Ideas:
- Bell Potter initiates coverage on Aristocrat Leisure (ASX:NGI) with a buy rating and has a 12-month share price target of $83. With a current share price of $73.72, this indicates a share price growth of 12.6% over the next 12-months, hence the buy rating is recommended.
- And Trading Central has identified a bullish signal on Navigator Global Investments (ASX:ALL), indicating that the stock price may rise from the close of $1.60 to the range of $1.83-$1.89 on a pattern formed over 74 days according to the standard principles of technical analysis.
Reporting Season has kicked off to a surprisingly strong start with a host of companies reporting their results in this first week of February. ResMed smashed investor expectations and REA Group produced stellar results despite the report being overshadowed by the retirement of the company’s CEO, Owen Wilson after 10 years with the company. Also, join Grady as she covers the ASX market performance this week and provides an outlook on what to expect for the remainder of this Reporting Season.
In this week’s wrap, Grady covers:
- (0:14): implications of Trump’s tariff halts with Mexico and Canada
- (0:50): surprisingly strong results that have kicked off Reporting Season
- (1:25): ResMed results exceeding expectations
- (2:33): REA Group’s 20% rise in revenue
- (5:26): how the local market performed this week so far
- (6:23): the most traded stocks & ETFs by Bell Direct clients
- (6:51): economic news items to watch out for.
Wall St closed higher overnight as investors pushed past the trade turmoil earlier on in the week. The Dow Jones gained 0.71%, the S&P 500 rose by 0.39% and the tech-heavy Nasdaq jumped by 0.19%.
Over in Europe, markets closed higher on Wednesday as earnings beats rose stock gains across the major sectors. The STOXX600 rose by 0.47%, with the majority of major sectors closing in the green. Germany’s DAX rallied 0.37%, the French CAC dropped 0.19% and over in the UK the FTSE100 ended the trading day 0.61% higher.
Locally yesterday, the ASX200 rose by 0.51% with most major sectors closing higher. Gains were led by the materials and information technology sectors which closed 1.61% and 1.56% higher. This was offset by the health sector which fell by 0.55%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.7% at market open this morning.
- On the commodities front this morning,
- Oil is trading 2.03% lower at 71 US dollars and 22 cents a barrel as oil inventories increased by 8.664 million barrels last week, the largest build in nearly a year.
- Gold is trading 0.83% higher at 2864 US dollars an ounce and iron ore is trading 0.36% higher at 105 US dollars and 40 cents a tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Comet Ridge Ltd (ASX:COI) and has a current share price of 13 and a half cents. With a 12-month price target of 21 cents, this indicates a share price growth of 56%, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on Jumbo Interactive (ASX:JIN), indicating that the stock price may rise from the close of $13.23 to the range of $15.20-$15.70, on a pattern formed over 114 days, according to the standard principles of technical analysis.
Over in the US on Tuesday, stocks closed higher as investors shift focus from Trump’s trade wars to fourth quarter earnings results. The Nasdaq rose 1.35%, the S&P500 gained 0.72% and the Dow Jones ended the day up 0.3%. Palantir, the big data analytics software provider, soared 24% on Tuesday to become a $200bn company after posting Q4 results that topped expectations.
In Europe overnight, markets closed mostly higher amid Trump’s tariffs pauses with Mexico and Canada and on the back of strong key corporate results out in the region. The STOXX 600 rose 0.3%, Germany’s DAX added 0.4%, the French CAC climbed 0.7%, and, in the UK, the FTSE100 ended the day down 0.15%.
Across the APAC region on Tuesday, markets rallied as China retaliated to Trump’s tariffs by slapping tariffs on US imports between 10% to 15% for certain goods. Hong Kong’s Hang Seng rose 2.83%, Japan’s Nikkei added 0.72%, South Korea’s Kospi index climbed 1.13% and China’s CSI index remains closed for the Lunar holiday.
Locally yesterday the ASX posted a slight loss of 0.06% yesterday as investors responded to Trump’s tariffs on China coming into effect and the late afternoon retaliation of Beijing placing a 10-15% tariff on certain goods from the US. On Monday, Trump suspended tariffs on Mexico and Canada as discussions between the regions began, while the tariffs in China came into effect late on Tuesday AU time. Tech stocks offset some of the heavy losses yesterday with a gain for the sector of 1.52%, while REIT and consumer discretionary stocks fell 1.06% and 0.76% respectively.
Online jobs advertisement platform Seek’s proposed acquisition of Xref for a value of $42.1m fell through yesterday after Xref’s shareholder voted against the takeover bid. Shares in Xref tumbled 22.6% yesterday while shares in Seek fell just 0.2%.
Crop protection solution producer Nufarm rallied over 3% on Tuesday after reporting a positive trading update including the expectation to achieve $100m from its omega-3 revenue in FY25 and its belt-tightening program for cost cutting remains on track with $50m of annualised savings.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.64% tracking Wall Street’s rebound overnight.
- On the commodities front this morning, oil has slipped to trade 0.70% lower at US$72.65/barrel, gold is up 1.04% at US$2843/ounce and iron ore is up 3.38% at US$105.02/tonne.
- The Aussie dollar has strengthened against the greenback to buy US$0.62, 96.41 Japanese Yen, 50.04 British Pence and NZ$1.11.
- On the reporting season calendar today, BWP Trust will release results.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Nufarm (ASX:NUF) from $4.25 to $4.35 and maintain a buy rating on the crop protection company following the release of a FY25 trading update. The analyst sees it has been a pleasing start to FY25 with strong levels of demand for crop protection products and the company remains on track to deliver $100m in Omega-3 revenues this year. The company is also on track to reduce working capital by 25-days per year end.
- And Trading Central has identified a bearish signal on Cleanaway Waste Management (ASX:CWY) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may fall from the close of $2.70 to the range of $2.63 to $2.65 according to standard principles of technical analysis.
Over in the US on Monday, stocks were heavily sold off in morning trade before recovering some losses in afternoon trade amid news of tariffs between the US and Mexico would be paused for a month as conversations between the presidents of the countries begin. The Dow Jones fell 0.28%, the S&P500 lost 0.76%, and the Nasdaq ended the day down 1.2%.
In Europe overnight markets closed lower after President Trump imposed tariffs on several countries and threatened to expand the tariffs to the European Union and the UK. The STOXX 600 fell 0.93%, Germany’s DAX lost 1.4%, the French CAC fell 1.2%, and, in the UK, the FTSE100 ended the day down 1.04%.
Across the Asia region on Monday negative investor sentiment around Trump’s tariffs spread into the region with Japan’s Nikkei falling 2.66% while South Korea’s Kospi lost 2.52%, Hong Kong’s Hang Seng dropped just 0.04% and, China’s CSI index remained closed for the Lunar holiday.
The local market started the new trading week with a significant sell-off, closing Monday’s session down 1.79% with every sector ending the day lower as investors reacted to the downside risk of flow through effects into our economy from Trump’s tariffs announced over the weekend.
Over the weekend President Trump introduced 25% tariffs on Canadian and Mexican imports and an additional 10% tariff on Chinese goods, which led Canada to retaliate with a 25% tariff on US goods into Canada.
There were few stories of good news on the market on Monday, but Lynas Rare Earths led the ASX200 gains with a rise of 3% despite no news out of the rare earth’s producer. The possible catalyst for the rise in the share price may be due to Gina Rinehart’s Hancock
Prospecting buying up shares in the rare earth’s producer over recent days.
Magellan shares also tumbled 8.7% yesterday following the departure of the company’s long-standing boss Gerald Stack.
What to watch today:
- Ahead of Tuesday’s trading session on the ASX, the SPI futures are anticipating the ASX will open the day up 0.47%.
- On the commodities front this morning oil is trading 0.26% higher at US$72.71/barrel, gold is up 0.8% at US$2819/ounce, and iron ore is up 0.26% at US$101.59/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy US$0.61, 95.55 Japanese Yen, 49.82 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has slightly decreased the 12-month price target on Aeris Resources (ASX:AIS) from 34cps to 29cps and maintain a buy rating on the multi-mine copper and gold producer following the release of the company’s December quarter update. Production at the company’s Tritton mine fell short of Bell Potter expectations while AISC topped BPe, while the company’s Cracow mine produced more gold at a lower cost than BP was expecting. The company’s near-term outlook is highly leveraged to the copper price and increasing grades and production at its Tritton copper mine.
- And Trading Central has identified a bearish signal on Bravura solutions (ASX:BVS) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may fall from the close of $2.11 to the range of $1.93 to $1.97 according to standard principles of technical analysis.
Wall Street had a negative end to the last trading week after President Donald Trump announced aggressive tariffs against major US trading partners would begin on Saturday. The Dow Jones fell 0.75%, the S&P500 lost 0.5% and the tech-heavy Nasdaq ended the day down 0.28%. Stocks with exposure to the key trade partners like Mexico, Canada and China posted greater losses on Friday including Mexican Food outlet Chipotle and Corona brewer Constellation Brands. Over the weekend President Trump introduced 25% tariffs on Canadian and Mexican imports and an additional 10% tariff on Chinese goods, which led Canada to retaliate with a 25% tariff on US goods into Canada.
In Europe on Friday, markets rose to end the week higher following the release of strong earnings results in the region. The STOXX 600 rose 0.13%, Germany’s DAX gained 0.02%, the French CAC added 0.11%, and, in the UK, the FTSE100 ended the day up 0.31%.
Across the APAC region on Friday, markets mostly rose following strength on Wall St on Thursday. Japan’s Nikkei added 0.15%, South Korea’s Kospi Index fell 0.77%, and India’s Nifty 50 added 1.18%, while China’s CSI and Hong Kong’s Hang Seng were both closed for the Lunar New Year.
What to watch today:
- Locally to end the last trading week, the ASX200 post a 0.45% gain on Friday and 1.83% rise for the trading week as a rally late in the week for mining stocks finished off a strong week on the local market. Rate sensitive sectors like tech, REIT and consumer discretionary stocks also had a strong week after inflation data in Australia came in below economists’ expectations and pave the way for the RBA to seriously consider a rate cut in 2 weeks.
- Simonds Group shares had a stellar day on Friday with a rise of 27% after leading Australian home building company agreed to pay $10m for the acquisition of Melbourne-based Dennis Family Homes to increase its new construction builds by 25% next financial year.
- PointsBet on the other hand tumbled over 13% on the release of the company’s quarterly trading update including flat growth in quarterly total net win and negative normalised EBITDA of $3.3m for the first half.
- Ahead of the first trading session of the new week and new month the SPI futures are anticipating the ASX will open the day down 1.19% likely due to investor reactions to the Trump tariffs announced over the weekend.
- On the commodities front this morning oil is trading 0.3% lower at US$72.53/barrel, gold is up 0.04% at US$2797/ounce and iron ore is up 0.26% at US$101.59/tonne.
- The Aussie dollar has further weakened to buy 62.15 US cents, 95.37 Japanese Yen, 50.12 British Pence and 1 New Zealand dollar and 10 cents.
- On the reporting season calendar today, Argo Investments will release results today.
Trading Ideas:
- Bell Potter has downgraded the rating on Strike Energy (ASX:STX) from a speculative buy to a speculative hold rating and have a 12-month price target of 27cps on the gas producer following the release of a 2Q trading update outlining production and revenue lower than Bell Potter expected due to maintenance impacting output.
- Trading Central has identified a bullish signal on Nufarm (ASX:NUF) following the formation of a pattern over a period of 11-days which is roughly the same amount of time the share price may rise from the close of $3.65 to the range of $3.86 to $3.92 according to standard principles of technical analysis.
Australian stocks rallied to record highs this week due to easing inflation and positive corporate results, raising hopes for a February rate cut. The upcoming earnings season will reveal the impact of factors like subdued Chinese demand, a weakening Australian dollar, and fluctuating commodity prices on various sectors, including miners, tech, REITs, and consumer discretionary.
In this week’s wrap, Grady covers:
- (0:50): China’s signs of a post- pandemic recovery
- (1:31): what the gold rally means for gold producers
- (2:11): the performance of mining stocks
- (3:30): what to expect this reporting season
- (4:23): how the local market performed this week so far
- (5:11): the most traded stocks & ETFs by Bell Direct clients
- (5:38): economic news items to watch out for.
Wall St fell overnight as the Federal Reserve left interest rates unchanged in its first policy decision of the year. The Dow Jones fell 0.31%, the S&P 500 dropped 0.47% and the tech-heavy Nasdaq closed just over half a percent higher.
Over in Europe, markets closed higher as corporate earnings results start to get released. The STOXX600 rose by half a percent with gains lead by the technology sector which rose by 2%. Germany’s DAX jumped nearly 1%, the French CAC fell 0.32% and over in the UK the FTSE100 rose by 0.28%.
Locally yesterday the ASX200 rose by 0.57% following the release of important inflation data. The quarterly inflation print has boosted investor sentiment and hopes for the RBA rate cut cycle to begin in February as underling inflation fell at a sharper rate than expected to the lowest level in 3-years of 3.2% for the December quarter.
Star Entertainment shares rose over 13% yesterday after the company made its first sale of non-core assets to the value of $60m for the sale of its Sydney entertainment centre assets. While it isn’t enough to revive the company, it is a welcome start on the journey to rebuilding.
What to watch today:
- The Australian share market is set to open lower with the SPI futures suggesting a fall of 0.06% at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.08% lower at 72 US dollars and 97 cents a barrel following concerns over rising US stockpiles.
- Gold is trading 0.21% lower at 2756 US dollars an ounce and iron ore is trading 0.04% lower at 101 US dollars and 30 cents a tonne.
Trading Ideas:
- Bell Potter has slightly increased the 12-month price target on Pilbara Minerals (ASX:PLS) from $2.95 to $3.00 and maintain a buy rating on the leading lithium producer following the release of the company's 2Q25 results. Despite depreciated pricing of lithium in the current cycle, PLS beat analysts' expectations for sales volumes and average realised pricing.
- Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 41-days which is roughly the same amount of time the share price may rise from the close of $4.23 to the range of $4.37 to $4.41 according to standard principles of technical analysis.
In the US on Tuesday stocks recovered after the sharp sell-off following the emergence of China’s DeepSeek AI model that offers a lower cost alternative to the billions the US is spending in the AI space. The Nasdaq rallied 2.03%, the S&P500 climbed 0.92% and the Dow Jones ended the day up 0.31%. The DeepSeek AI sell-off on Wall St was due to social media buzz over the weekend around the Chinese startup unveiling a free open-source large language model of AI that it says took less than $6 million to build.
In Europe overnight, markets in the region also mostly rebounded on Tuesday in the in the wake of the global AI sell-off that spread through global markets on Monday. The STOXX 600 rose 0.5%, Germany’s DAX added 0.7%, the French CAC fell 0.12% and, in the UK, the FTSE100 ended the day up 0.35%.
Across the Asia region overnight, markets closed mixed as the AI-sell off continued to spread throughout the region. Japan’s Nikkei extended losses for a second session with a loss of 1.4% on Tuesday as China’s AI advancements threaten to challenge the US dominance in the space which flows through to countries like Japan who form a key part of the US AI-chip supply chain, while Hong Kong’s Hang Seng rose 0.14%, and South Korea’s Kospi Index ended the day up 0.85%.
The local market closed the first trading session of the week down 0.12% as fears of China’s AI rival DeepSeek taking power on the AI front dampened investor sentiment to start the holiday shortened trading week.
The datacentre, AI and broad tech rally of the last year took a sudden halt yesterday with local darlings in the sector like Goodman Group, and NextDC each falling over 6% amid the emergence of China’s DeepSeek AI rival and overvaluation fears in the sector.
The DeepSeek fear-based sell-off expanded into the uranium space, sending Paladin Energy and Boss Energy down over 10% each as investors fear less uranium will be needed to fuel nuclear power for the global AI revolution.
Sigma Healthcare rose over 12% yesterday after the Chemist Warehouse merger partner reported a strong trading update from Chemist Warehouse for the first half of FY25 including record sales, up 13% on the PCP, margin expansion through cost management and the opening of 19 new stores in the half. Sigma is set to merge with the discount chemist retail giant next month.
What to watch today:
- Ahead of the midweek session the SPI futures are anticipating the ASX will open the day up 0.43% tracking Wall Street’s rebound on Tuesday so far.
- On the commodities front this morning oil is trading 0.01% lower at US$73.17/barrel, gold is up 0.6% at US$2757.72/ounce and iron ore is flat at US$101.34/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy US$0.62, 97.19 Japanese Yen, 50.22 British Pence, and NZ$1.10.
Trading Ideas:
- Bell Potter has slightly increased the 12-month price target on Bellevue Gold (ASX:BGL) from $1.90 to $2.00 and maintain a buy rating on the gold producer. Despite weaker 2Q production leading to a FY25 guidance downgrade, the analyst sees upside to the share price from continuing improvement in production and cost performance in ongoing production ramp-up and expansion, strong gold prices and near-mine exploration programs.
- And Trading Central has identified a bullish signal on Accent Group (ASX:AX1) following the formation of a pattern over a period of 37-days which is roughly the same amount of time the share price may rise from the close of $2.38 to the range of $2.75 to $2.85 according to standard principles of technical analysis.
In the US on Monday the S&P500 and Nasdaq fell sharply to start the week lower on investor concerns about the AI bubble bursting due to the emergence of Chinese startup DeepSeek which has possibly made a competitive AI model for a fraction of the cost of the billions Silicon Valley is spending in the space. The Nasdaq tumbled 3.07% and the S&P500 lost 1.46%, while the Dow Jones ended the day down 0.65%.
European markets closed slightly lower on Monlday as investors reacted to the breakout of a new Chinese AI competitor. The STOXX 600 fell 0.07%, Germany’s DAX lost 0.53%, the French CAC fell 0.27% and, in the UK, the FTSE100 ended the day flat.
Across the Asia region, markets closed mostly higher on industrial profits in China and on the emergence of an AI rival in China. Japan’s Nikkei fell 0.92% in the days after the Bank of Japan increased the country’s cash rate to the highest level in 17-years, while Hong Kong’s Hang Seng rose 0.66%, China’s CSI index added 0.41% and South Korea’s Kospi Index gained 0.85%. China’s industrial profits jumped 11% from on the PCP, but for the year profits declined for a third straight year in data out yesterday for the month of December.
The local market was closed on Monday for the Australia Day holiday but on Friday the ASX200 posted a 0.36% gain on Friday to end a strong week on the local index following strength in the US on Thursday and strong corporate earnings reports boosting investor sentiment.
Synlait Milk soared 24% on Friday after reporting an impressive turnaround in operations in the first half and increased its guidance for the second half, with an outlook to a return to profitability this year. The milk producer underwent an aggressive cost cutting strategy through reducing head count and is set to increase prices to drive margin appreciation in the second half.
Oil producers locally on Friday tumbled tracking the declining price of oil amid Trump’s comments urging OPEC plus to bring down the price of oil.
What to watch today:
- Ahead of the first trading session of the new trading week the SPI futures are anticipating the ASX will open the day up 0.17%.
- On the commodities front this morning oil is trading 2.06% lower at US$73.14/barrel, gold is down 1.05% at US$2741/ounce and iron ore is flat at US$101.34/tonne.
- The Aussie dollar has strengthened overnight against the greenback to buy 62.85 US cents, 97.24 Japanese Yen, 50.28 British Pence and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Bell Potter has slightly decreased the 12-month price target on Kogan.com (ASX:KGN) from $5.30 to $5.10 and maintain a hold rating on the online retailer following the release of the company’s preliminary 1H25 update including adjusted EBITDA missing expectations driven by an incremental increase in marketing investment during the promo period and the Mighty Ape re-platforming related issues which persisted through October.
- And Trading Central has identified a bearish signal on Healius (ASX:HLS) following the formation of a pattern over a period of 290-days which is roughly the same amount of time the share price may fall from the close of $1.41 to the range of $0.70 to $0.85 according to standard principles of technical analysis.
The ASX200 posted a gain of 0.82% (Monday – Thursday) this week, led by strength for tech, financials, and industrial stocks. Our local market also took strong lead from Wall Street’s Trump rally that saw the S&P500 hit a fresh record.
In this week’s wrap, Grady covers:
- (0:10): tariff announcements in Trump’s first days back in office
- (2:19): why financials & gold stocks rallied this week
- (3:57): the best & worst performing stocks on the ASX200
- (4:59): the most traded stocks & ETFs by Bell Direct clients
- (5:29): economic news items to watch out for.
In the US today on Wednesday the Trump 2.0 fuelled rally extended into the midweek session, sending the S&P500 to a fresh all-time high, up 0.61%, while the Dow Jones rose 0.3% and the Nasdaq ended the day up 1.28%. Strong corporate earnings results are also fuelling the strength in equities with Netflix jumping over 9% after surpassing 300 million paid memberships inQ4, while Procter & Gamble added nearly 2% on earnings topping expectations.
In Europe overnight, markets closed mostly higher on strong corporate earnings results in the region which boosted Germany’s DAX to an all-time high again on Wednesday with a gain of 1.01%. The French CAC rose 0.86%, but, in the UK, the FTSE 100 ended the day down just 0.04%. Sportswear giant Adidas rose 6% on the German index on Wednesday after sales grew by 19% in Q4 results.
Across the Asia region on Wednesday markets closed mixed led by China’s CSI index falling 0.93% as President Trump signalled his plans to impose a 10% tariff on China. Hong Kong’s Hang Seng also fell 1.72% on Wednesday while South Korea’s Kospi index rose 1.15%, and Japan’s Nikkei ended the day up 1.58%.
The local market closed the midweek session 0.33% higher, extending on Tuesday’s gains as 7 of the 11 sectors ended the day higher. Our big miners came under pressure yesterday though after US President Donald Trump said he was considering a 10% tariff on China which Australia is reliant on for key commodity trade.
Technology shares rose on Wednesday after Netflix posted its biggest quarterly subscription gain ever in afterhours trade in the US, fuelling investor hopes for broad growth in the tech sector on an earnings front.
Woodside shares fell almost 2% yesterday after the oil and gas producer released the most recent quarterly results including production falling 3% due to weaker seasonal demand.
Bub’s Australia soared 22.5% on Wednesday after the infant formula producer reported a sharp turnaround in 1H earnings with the company achieving EBITDA of $2.9m following a $6.8m loss in the PCP.
What to watch today:
- Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.35%.
- On the commodities front this morning, oil is trading 0.1% higher at US$75.97/barrel, gold is up 0.48% at US$2757/ounce and iron ore is flat at US$101.21/tonne.
- The Aussie dollar has further strengthened overnight to buy US$0.62, 98.29 Japanese Yen, 50.76 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Paladin Energy (ASX:PDN) from $10.50 to $10.70 and maintain a buy rating on the uranium producer following the release of a second quarter update including operational gains at its Langer Heinrich Mine in Namibia with production of 640 thousand pounds which beat BPe and C1 costs of US$42.3/pound which fell below BPe which was a welcome result.
- And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU) following the formation of a pattern over a period 85-days which is roughly the same amount of time the share price may rise from the close of $2.83 to the range of $3.25 to $3.35 according to standard principles of technical analysis.
Wall St was closed overnight due to the Martin Luther King Jr public holiday whilst Donald Trump was inaugurated as the 47th president of the United States.
Over in Europe, markets closed slightly higher as investors react to Donald Trump being sworn in as the US president. The STOXX600 closed 0.05% higher with mining stocks leading gains up 1.2%. Germany’s DAX rose by 0.42%, the French CAC jumped 0.31% and over in the UK the FTSE100 climbed 0.18%.
Locally yesterday, the ASX200 rose by 0.45% with most major sectors closing in the green. Gains were led by the information technology and real estate sectors which rose by 1.13% and 0.78% respectively. This was offset by the energy sector which fell by over half a percent by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.34% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.83% lower at 76 US dollars and 45 cents a barrel as markets reacted to Donald Trump’s pledge to expand domestic crude production.
- Gold is trading 0.18% higher at 2705 US dollars an ounce and iron ore is trading 0.72% higher at 101 US dollars and 21 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Genusplus Group (ASX:GNP) and keeps an unchanged 12-month price target of $3.10. The buy rating has been maintained by Bell Potter as GNP has been awarded a new $140m contract by Ausgrid for sub-transmission line works at the Hunter-Central Coast Renewable Energy Zone project. The contract award is material and bolsters GNP’s orderbook in the medium term, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Beacon Lighting Group (ASX:BLX), indicating that the share price may rise from the close of $3.05 to the range of $3.60-$3.70, on a pattern formed over 70 days, according to the standard principles of technical analysis.
Wall St closed higher on Friday to post the firstly weekly gain across the three major averages for the year as the big tech rally resumed momentum. The Dow Jones rose 0.78% on Friday and 3.7% for the week, the S&P500 added 1% on Friday and 2.9% for the week, and the Nasdaq ended Friday’s session up 1.51% and added 2.5% for the week. In Europe on Friday the positive investor sentiment extended into the European region buoyed by a strong rally for mining stocks. The STOXX 600 rose 0.68%, Germany’s DAX added 1.35%, the French CAC gained 0.98%, and, in the UK, the FTSE100 ended the day up 1.35%. Across the Asia markets on Friday it was a mixed session as strong economic data in China boosted investor sentiment in the region. China’s CSI index rose 0.31% on Friday after fresh GDP data showed the Chinese economy expanded by 5% YoY and retail sales rose 3.7% which beat expectations. Hong Kong’s Hang Seng rose 0.21% on Friday and Japan’s Nikkei fell 0.31% at the closing bell. Locally on Friday, the ASX200 took lead from Wall Street’s losses overnight to post a 0.2% loss on Friday as the financials weighed on the key index. The pullback followed the ASX200 rising 1.4% on Thursday so for the week the key index still managed a gain of 0.2% last week.
On an economic data front on Friday, we had the highly anticipated retail sales, industrial production, and GDP readings out of China. The Chinese economy expanded 5.4% in Q4 which was above the 5% forecast and above the 4.6% recorded in Q3 which is a welcome sign of material recovery in the region post pandemic. Retail sales further supported the recovery story with a rise of 3.7% in December which beat the 3.2% economists were expecting and is a sharp rise from the 3% reported in November. And Industrial production in the region also rose 6.2% in December on an annual basis which also exceeded expectations and was a sharp rise from the 5.4% reported in November. Overall, the economic growth in China is finally starting to show signs of material turnaround and this boosted the iron ore price and stocks with exposure to the region on Friday.
The winning stocks on the ASX200 on Friday were led by Megaport rallying 10.10%, Liontown Resources rising 9.5% and Lovisa adding 7.73%. And on the losing end REA Group fell 2.71%, TPG Telecom lost 2.4% and JB Hi-Fi ended the day down 2.15%.
Insignia Financial is the talk of the M&A world right now as Bain Capital and CC Capital fight to acquire the nearly 200-year-old Aussie wealth management company. Shares in Insignia rose 6% on Friday after CC Capital increased its takeover offer to a value over $3bn or $4.60/share, above the $4.30/share Bain matched earlier this week. How this one plays out will be very interesting but it’s no wonder why CC and Bain want to acquire Insignia as the purchase will give the acquirer a market leadership position in Australia’s over $4tn superannuation market. And Telix Pharmaceuticals rose 4% on Friday after the cancer imaging and therapy pharmaceuticals company received approval from Europe’s Marketing Authorisation Application for its prostate cancer imaging agent Illucix which already has FDA and TGA approval. This further expansion into Europe broadens the company’s revenue runway for its leading agent Illucix.
What to watch today:
- Ahead of the first trading session of the new trading week the SPI futures are anticipating the ASX will open the new day up 0.34%.
- On the commodities front this Monday morning, oil is trading 1.02% lower at US$77.88/barrel, gold is down 0.5% 2700.99/ounce and iron ore is up 0.72% at US$101.21/tonne.
- The Aussie dollar is buying US$0.61, 96.85 Japanese Yen, 50.88 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has reduced the 12-month price target on Lynas Rare Earths (ASX:LYC) from $7.70 to $7.20 and maintain a hold rating on the rare earths producer following the release of a 2nd quar
The ASX200 has seen a modest 0.4% gain (Mon – Thurs), recovering from a chopping start to the week. While early trading was marked by mixed signals, the release of the latest US inflation data added optimism to global markets.
In this week’s wrap, Grady covers:
- (0:23): implications of the inflation reading on the Fed’s monetary policy
- (0:52): how Australia’s employment figures impact the economy
- (1:43): key areas of focus for the upcoming earnings season
- (4:20): the best & worst performers on the ASX200 this week
- (5:12): the most traded stocks by Bell Direct clients
- (5:39): economic news items to watch out for.
Wall St closed higher overnight after the latest US inflation report showed that core inflation slowed in December. The Dow Jones rose by 1.65%, the S&P 500 jumped 1.83% and the tech-heavy Nasdaq closed 2.45% higher.
US Core inflation data was released last night and came in unexpectedly lower than the forecast of 0.3% month on month to 0.2% in December.
Over in Europe, markets closed higher following the release of UK and US inflation data. The STOXX600 snapped a 3-day losing streak ending the day 1.3% higher with all major sectors closing in the green. Gains were led by retail stocks which rallied by 2.7%.
Locally yesterday, the ASX200 fell by 0.22% by market close. Losses were led by the information technology and communication services sectors, which fell by 1.25% and 1.21% respectively. This was offset by the consumer discretionary sector which rose by 0.19% by market close.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 1.27% by market open this morning.
- In terms of economic data, Australian unemployment data will be released at 10:30 this morning with a forecast of 3.9%, the same as its previous result.
-
On the commodities front this morning,
- Oil is trading 3.83% higher at 80 US dollars and 45 cents a barrel after underlying inflation in the US triggered bets of lower rates by the Fed this year
- Gold is trading 0.76% higher at 2695 US dollars an ounce and iron ore is trading 1.29% higher at 99 US dollars and 99 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Coronado Global Resources (ASX:CRN) and has a 12-month price target of $1.45. With a current share price of $0.75, this indicates a share price growth of 95% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Pacific Current Group (ASX:PAC), indicating that the stock price may rise from the close of $11.92 to the range of $12.31-$12.39, on a pattern formed over 13 days, according to the standard principles of technical analysis.
Wall St closed mixed again on Tuesday as investors await key inflation data out in the region on Wednesday US time and following the release of a lighter-than-expected producer price index report. The Dow Jones rose 0.52%, the S&P500 gained 0.11% and the tech-heavy Nasdaq ended the day down 0.23%. The US PPI index which measures wholesale inflation increased just 0.2% in December which was below the 0.4% economists were expecting and indicates inflation is continuing to cool in the US.
In Europe overnight, markets in the region closed mixed with the STOXX 600 falling 0.08% while the UK’s FTSE 100 shed 0.28%, but in Germany the DAX rose 0.7% and in France, the CAC ended the day up 0.2%.
Across the Asia region on Tuesday, markets mostly rose, tracking investor moves in the US out of tech stocks and into other areas of the market. Hong Kong’s Hang Seng rose 1.9% on Tuesday, South Korea’s Kospi Index gained 0.31%, and China’s CSI index added 2.63%, but Japan’s Nikkei was the outlier with a fall of 1.83% yesterday.
The local market rose 0.48% on Tuesday despite global market turbulence on Monday. Rising bond yields and strength in the US economy spooked investors late last week with concerns the Fed will not cut rates again at least in the near-term, but locally, investor optimism has risen early in the week to send the key index higher for the last 2-days.
The energy and materials sectors did most of the heavy lifting yesterday driven by a rally for oil and iron ore prices on favourable outlook on a global scale.
Westpac consumer confidence data out yesterday for January indicated consumer pessimism persists with a decrease of 0.7%, following on from the 2% decrease in December. While the reading is a second decline in consumer sentiment, the level is still above that from a year ago and signals consumers are expecting a gradual improvement in conditions in 2025.
Star Entertainment Group once again led the gains on Tuesday with a gain of 12% at the closing bell despite the embattled casino operator being around 6-weeks away from collapse with just $79m left in the bank. Investors were buying in again yesterday after a mystery Macau businessman continued buying up shares in the stock with another 28m purchased by Xingchun Wang yesterday.
And in the retail space City Chic shares rose over 11% as investors welcomed the plus size fashion retailer’s first half trading update including strong sales over the holiday period, reduced inventory and a return to profitability.
The winning stocks on the ASX200 yesterday were led by Ingenia Communities Group rallying 13.05%, Star Entertainment Group rising 12% and Polynovo adding 6.4%.
And on the losing end Life360 fell 3.3%, West African Resources lost 3.12% and HMC Capital ended the day down 2.45%.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.07%.
- The Aussie dollar has further weakened overnight to buy US$0.61, 97.79 Japanese Yen, 50.79 British Pence and 1 NZ$1.11.
- On the commodities front this morning, oil has retreated 1.42% to trade at US$77.68/barrel, gold is up 0.08% at US$2670/ounce and iron ore is up 0.64% at US$98.72/tonne.
Trading Ideas:
- Bell Potter has maintained a spec buy rating and 12-month price target of $1.30/share on Opthea (ASX:OPT) following the release of Phase 3 trials baseline data being released leading to confidence in the company’s sozinibercept combination therapy in diabetic macular edema as the Phase 3 patient populations are broadly similar to those included in the previous Phase 2b trials. The analyst is also confident with Opthea’s cash runway with $130m in the bank.
- And Trading Central has identified a bearish signal on SkyCity Entertainment (ASX:SKC) following the formation of a pattern over a period of 98-days which is roughly th
Wall St closed mixed to start the new trading as investors shift out of tech stocks and into the industrials sector of the market. The Dow Jones rose 0.86%, the S&P500 gained 0.16% and the tech-heavy Nasdaq ended the day down 0.38%. Rising bond yields also pressured equities at the start of the week as investors shift to the relatively safer returns of bonds over equities when bond yields rise.
In Europe overnight, markets in the region closed lower amid rising bond yields and a soaring USD. The STOXX 600 fell 0.55% on Monday, Germany’s DAX lost 0.41%, the French CAC fell 0.3% and, in the UK, the FTSE100 ended the day down 0.3%.
Across the Asia region on Monday, markets closed lower taking lead from Wall St on Friday and on the back of key economic data being released out of China. China’s imports rose 1% in December, which significantly topped economists’ expectations of a 1.5% decline while exports jumped 10.7% YoY which was also above the 7.3% rise markets were expecting. China’s CSI index fell 0.3% on Monday, Hong Kong’s Hang Seng lost 0.73% and South Korea’s Kospi Index ended the day down 1.04%.
The local market started the new trading week lower, ending the day down 1.2% as negative sentiment on the rate front in the US filtered into our local market on Monday. A stronger-than-expected jobs report out in the US on Friday dampened hopes of rate cuts out of the Fed anytime soon, which sparked the broad sell-off in Australia yesterday.
Department store giant Myer tumbled over 23% yesterday after the retailer released an ‘in-line’ trading update with flat growth amid challenging trading conditions during the high interest rate environment. The update dragged down shares in Premier Investments too by 16% as Premier is the largest shareholder in Myer.
Meanwhile Insignia Financial rallied 2.43% after Bain Capital moved to match its takeover bid to that of CC Capital’s $4.30/share as the race to take over one of Australia’s leading wealth providers heats up.
And Novonix tumbled almost 10% on Monday after the US Department of Energy didn’t permit the battery materials producer access to specific tax credits to make it eligible for an additional loan to fund its Tennessee facility.
What to watch today:
- Ahead of Tuesday’s session on the ASX the SPI futures are anticipating the local market will open the day up 0.45%.
- On the commodities front this morning oil is trading 3% higher at US$78.89/barrel, gold is down almost 1% at US$2660/ounce and iron ore is flat at US$98.09/tonne.
- The Aussie dollar has slightly strengthened overnight against the greenback to buy US$0.61, 96.90 Japanese Yen, 50.64 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Lynas Rare Earths (ASX:LYC) from $7.50 to $7.70 and maintain a hold rating on the rare earths producer ahead of the release of the company’s 2QFY25 report on 17th January. The analyst is looking for commentary on ramp up and production guidance across the business given weaker than anticipated Rare Earth prices but increases the price target due to their blended forward EV/EBITDA picking up a greater portion of FY26.
- And Trading Central has identified a bullish signal on Ramelius Resources (ASX:RMS) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may rise from the close of $2.18 to the range of $2.46 to $2.52 according to standard principles of technical analysis.
Wall St closed sharply lower on Friday as a hot job report out in the US dampened expectations for further interest rate cuts out of the Fed this year. The Dow Jones fell 1.63%, the S&P500 lost 1.54% and the tech-heavy Nasdaq ended the day down 1.63%. In December US payrolls grew by 256,000 which was well above the 155,000 economists were expecting. While this strong jobs report is good to signal a robust economy, it is not good for market sentiment on the rate cut front as a strong labour market leads to higher income and consumer spending which in-turn drives inflation.
The negative market sentiment flowed into the European region on Friday with markets in Europe also closing the day lower. The STOXX 600 fell 0.83%, Germany’s DAX lost 0.5%, the French CAC slid 0.79% and, in the UK, the FTSE100 ended the day down 0.86%. Eurozone bond yields also rose on Friday which pressured equities in the region.
Across the Asia region on Friday, markets mostly fell as real household spending in Japan declined 0.4% YoY in November while average real household income rose 0.7% in the same period. Japan’s Nikkei fell 1.05%, China’s CSI index lost 1.25%, Hong Kong’s Hang Seng fell 0.95% and South Korea’s Kospi Index ended the day down 0.24%.
Locally on Friday the ASX200 fell 0.42% as all sectors aside from materials stocks ended the day in the red, led by financials stocks declining 1.17%. The miners had a much-needed relief rally following days of depreciation on the back of a rise in the price of iron ore, while the banks took the biggest hit on broker downgrades within the sector. Star Entertainment Group fell a further 15.8% on Friday, extending heavy losses into a third session as investor concerns grow over the future of the embattled casino operator.
Insignia Financial on the other hand rallied over 2% on reports a 3rd bidder, Brookfield, is weighing up a bid for the superannuation and wealth giant.
What to watch today:
- Ahead of the first trading session of the new week the SPI futures are anticipating the ASX will open the day down 0.86% tracking Wall St losses on Friday.
- On the commodities front this morning, oil is trading 3.6% higher at US$76.57/barrel, gold is up 0.6% at US$2685/ounce, and iron ore is flat at US$98.09/tonne.
- The Aussie dollar has further weakened to buy 61.48 US cents, 97.00 Japanese Yen, 50.35 British Pence and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Bell Potter has downgraded the rating on Avita Medical (ASX:AVH) from a speculative buy to a speculative hold and have reduced the price target on the company from $4.60 to $3.50 after the company updated its guidance for FY24 with Q4 revenue now expected at US$18.4m which is well below the previously issued guidance range of US$22.3m to $24.3m amid a weaker response than expected from the recent launch of Recell Go.
- And Trading Central has identified a bullish signal on JB Hi-Fi (ASX:JBH) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $96.40 to the range of $101.75 to $103.00 according to standard principles of technical analysis.
Join Grady in the first Weekly Wrap of 2025. The ASX200 advanced 0.95% in the first trading week of the year (Mon – Thurs). Economic data was released this week, which saw inflation cooling, increasing the likelihood of an RBA rate cut in February. However, a strong labour market and persistent inflationary pressures may lead the RBA to hold rates steady.
In this week’s wrap, Grady covers:
- (0:38): what the latest CPI reading means for markets
- (1:42): how retail sales performed over the Black Friday sale period
- (2:25): what to except from the RBA’s next meeting
- (4:05): how the ASX200 performed this week so far
- (4:53): the most traded stocks & ETFs by Bell Direct clients
- (5:20): economic news items to watch out for.
Wall St closed mixed overnight as investors assess future potential rate cuts from the Federal Reserve following continuous inflationary pressures. The Dow Jones gained a quarter of a percent, the S&P500 jumped 0.16% and the tech-heavy Nasdaq fell by 0.06%.
Over in Europe, markets closed lower after regional economic sentiment fell in December, according to data. The STOXX600 closed Wednesday’s trading session 0.27% lower with most major sectors closing in the red. Germany’s DAX lowered by 0.05%, the French CAC lost nearly half a percent and over in the UK, the FTSE100 had a slight rise of 0.07%.
Locally yesterday, CPI data was the key driver of investor sentiment which led to a 0.77% rise for the key index at the closing bell of the midweek session. Australia’s monthly CPI data showed a rise of headline inflation to 2.3% in the 12-months to November, which is up from a the 2.1% reported in the year to October but indicates headline inflation remains in the RBA’s target 2-3% range. Yesterday’s gains were led by the materials and financial sectors which rose by 1.61% and 1.27% respectively. This was offset by the information technology sector which fell by 0.82% at the close of trade.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.37% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.21% lower at 73 US dollars and 35 cents a barrel, gold is trading half a percent higher at 2663 US dollars an ounce and iron ore is trading 1.61% lower at 97 US dollars and 84 cents a tonne.
Trading Ideas:
- Bell Potter initiated coverage on Austin Engineering (ASX:ANG) with a buy rating and a 12-month price target of $0.86. With a current share price of $0.52, that indicates a share price growth of 65.4% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bearish signal in AVITA Medical (ASX:AVH), indicating that the share price may fall from the close of $3.51 to the range of $2.65-$2.85, on a pattern formed over 32 days, according to the standard principles of technical analysis.
Over in the US on Tuesday, Wall Street closed lower across the major averages as fresh economic data and higher bond yields weighed on investor sentiment. The Dow Jones fell 0.42%, the Nasdaq lost 1.9% and the S&P500 ended the day down 1.11%. Fresh data from the Institute for Supply Management revealed faster-than-expected growth in the US services sector in December which raises investor concerns of inflation remaining sticky in the world’s largest economy.
In Europe overnight, markets mostly extended their recent rally to close higher on Tuesday as investors digested inflation data and key corporate results. The STOXX 600 added 0.32%, Germany’s DAX rose 0.62%, the French CAC lifted 0.6% and, in the UK, the FTSE 100 ended the day down just 0.05%. Annual inflation in the eurozone rose to 2.4% in December which is up from the 2.2% rise in November but was in line with economists’ expectations.
Across the APAC region on Tuesday, markets closed higher led by Japan’s Nikkei as a global tech rally boosted the growth sectors across markets in the region. Japan’s Nikkei rose 1.97% on Tuesday, South Korea’s Kospi Index advanced 0.14%, and China’s CSI index rose 0.72%.
The local market extended its rally into Tuesday with a gain of 0.33% on the back of a strong start to the week for US and European markets on Monday. Chip and tech stocks led the charge yet again early in the week as investor optimism for earnings growth potential continues to drive tailwinds for the high growth tech sector.
Once again yesterday, the mining giants came under pressure amid concerns over demand outlook for key commodities following further weak economic data out of China over recent weeks including manufacturing PMI, retail sales and trade balance data. Fortescue lost 4.4% on Tuesday, while BHP declined 0.7% and Rio ended the day down 0.7%.
Meanwhile, IDP Education rose almost 4% yesterday after Macquarie upgraded the stock to ‘outperform’ citing near-term consensus downgrades and the company’s 1H25 results as potential investing opportunities.
4D Medical shares rocketed over 16% yesterday after receiving FDA clearance for its AI-driven IQ-UIP lung diagnostic tool, designed to improve the diagnosis of Usual Interstitial Pneumonia, a key marker for Interstitial Pulmonary Fibrosis (IPF). The global IPF treatment market, valued at $4.01bn in 2024, is expected to grow to over $7.8bn in the next decade.
Elsewhere in the healthcare space, we saw Opthea soar over 7.5% after the clinical-stage biopharmaceutical company announced the publication of its Phase 1b trial of its lead product candidate for combination therapy in diabetic macular edema.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.19% tracking Wall Street’s losses overnight.
- On the commodities front this morning oil has recovered from the recent dip to trade 0.97% higher at US$74.28/barrel, gold is up 0.63% at US$2651/ounce and iron ore is flat at US$99.44/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy 62.41 US cents, 98.45 Japanese Yen, 50.01 British Pence and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Trading Central has identified a bearish signal on IRESS (ASX:IRE) following the formation of a pattern over a period of 18-days which is roughly the same amount of time the share price may fall from the close of $9.22 to the range of $8.15 to $8.35 according to standard principles of technical analysis.
- And Trading Central has identified a bullish signal on Jumbo Interactive (ASX:JIN) following the formation of a pattern over a period of 39-days which is roughly the same amount of time the share price may rise from the close of $14.12 to the range of $15.70 to $16.10 according to standard principles of technical analysis.
Wall Street started the new trading week in mostly positive territory as chip stock boosted the S&P and Nasdaq higher with gains of 0.55% and 1.24% respectively, while the Dow Jones lagged the market with a fall of 0.06%. Market optimism about tech stocks and the earnings growth potential remains elevated which continues to fuel strong tailwinds for the sector.
Over in Europe on Monday markets closed higher amid reports Trump’s team is considering a plan to impose tariffs on all countries but only on ‘critical imports’. The STOXX 600 rose 0.94%, Germany’s DAX added 1.56%, the French CAC climbed 2.24% and, in the UK, the FTSE 100 ended the day up 0.31%.
Across Asia on Monday, markets closed mostly lower as investors digested business activity and key data out in specific regions. China’s Caixin services PMI index from S&P Global rose to 52.2 in December, the fastest expansion since May last year. Despite this, China’s central bank said over the weekend it would implement a ‘moderately loose’ monetary policy in 2025. China’s CSI index fell 0.16% on Monday, Hong Kong’s Hang Seng lost almost 0.5% but South Korea’s Kospi Index rose 1.91%.
Locally, the ASX raced out of the gates this morning with a strong rally on the back of Wall Street’s strength on Friday before pulling back in afternoon trade to close just 0.08% higher as the miners weighed on the market gains despite the tech sector posting a 0.8% gain.
The iron ore mining giants came under pressure yesterday amid a decline in the price of iron ore to below US$100/tonne. Singapore’s iron ore futures contracts falling below US$100/tonne were the key driver of the spot price decline today as traders exit amid easing demand for the commodity.
DroneShield fell over 1.5% on Monday despite the counter-drone technology producer announcing a $9.7m order from a major military customer in Latin America.
While Gold Road Resources rose 1.2% after reporting record quarterly production at the 50%-owned Gruyere project with 91,631 ounces of gold produced during the December quarter, significantly above the 68,781 ounces produced in the September quarter.
Insignia Financial shares soared over 14% yesterday to a 3-year high after the superannuation company announced it had received a $2.87bn takeover bid from US-based investment manager CC Capital Partners, which trumps the former takeover offer of $2.67bn from Bain Capital. The deal would provide CC Capital with access and market share into Australia’s estimated $4.1tn superannuation market which is considered to be the 4th largest in the world.
What to watch today:
- Ahead of Tuesday’s trading session on the ASX the SPI futures are anticipating the local market will open the day up 0.15%, extending on the positive finish from yesterday.
- On the commodities front this morning oil is trading 0.67% lower at US$73.47/barrel, gold is down just 0.06% at US$2636/ounce and iron ore has further weakened to trade down 1.16% at US$99.44/tonne.
- The Aussie dollar is buying US$0.62, 98.44 Japanese Yen, 50.09 British Pence and NZ$1.11.
Trading Ideas:
- Trading Central has identified a bullish signal on Macquarie Group (ASX:MQG) following the formation of a pattern over a period of 70-days which is roughly the same amount of time the share price may rise from the close of $224.47 to the range of $243 to $248 according to standard principles of technical analysis.
- And Trading Central has identified a bearish signal on Australian Ethical Investment (ASX:AEF) following the formation of a pattern over a period of 38-days which is roughly the same amount of time the share price may fall from the close of $5.15 to the range of $4.25 to $4.45 according to standard principles of technical analysis.
Wall Street closed the first trading week of the new year lower for the week but had a slight uplift on Friday as the 2024 darling chip stocks lifted the indices to a positive finish on Friday. The Nasdaq and S&P 500 each snapped 5-day losing streaks to close up 1.77% and 1.26% respectively while the Dow Jones ended the day up 0.8%.
Across the European markets on Friday, it was a red finish as markets in the region tracked the lower start for global markets in 2025. Automotive and travel stocks took the biggest hit on Friday across the board, while the STOXX 600 fell 0.5%, Germany’s DAX lost 0.6%, the French CAC fell 1.52%, and, in the UK, the FTSE100 ended the day down 0.44%.
Over in the APAC region on Friday investors extended the selloff in China as the CSI index fell 1.2% amid economic stability continues its struggle to regain momentum and growth post pandemic. Elsewhere in the region, South Korea’s Kospi index rose 1.8%, Japan’s Nikkei fell 0.96%, and Hong Kong’s Hang Seng ended the day up 0.7%.
Locally on Friday the ASX 200 rose 0.6% buoyed by energy stocks soaring 4.5% amid a rise in the price of oil late last week to a two-month high. Trading continues to remain subdued as investors are still on holidays.
Uranium miners rallied on Friday on supply shortage concerns after Canada’s uranium giant Cameco announced suspension of production at its Kazakhstan-based uranium operation.
What to watch today:
- Ahead of Monday’s trading session here on the ASX the SPI futures are anticipating the local market will start the new trading week up 0.28%.
- On the commodities front this morning oil is trading 1.14% higher at US$73.96/barrel, gold is down 0.76% at US$2638/ounce and iron ore is down 1.16% at US$99.44/tonne.
- The Aussie dollar is buying US$0.62, 97.76 Japanese Yen, 50.05 British Pence, NZ$1.11.
Trading Ideas:
- Bell Potter has slightly increased the 12-month price target on Champion Iron (ASX:CIA) to $7.15 and maintain a buy rating on the iron ore producer following the announcement that the company has entered into a binding agreement with Nippon Steel Corporation and Sojitz Corporation to form a partnership for the joint ownership and development of the Kami Project. The analyst sees CIA will benefit from maturing high-grade iron concentrate markets and a shift into higher grade production in 2H 2025.
- And Trading Central has identified a bullish signal on QBE Insurance (ASX:QBE) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $19.69 to the range of $21.00 to $21.40 according to standard principles of technical analysis.
In the final Weekly Wrap of 2024, Grady recaps a year of strong performance for the ASX. Key factors for 2025 include potential rate cuts, China’s economic recovery, and the impact of new US trade policies. The healthcare sector is poised for growth, and the ASX is expected to rise further.
In this week’s wrap, Grady covers:
- (0:11): how the ASX performed in 2024
- (0:39): China’s economic recovery & growth rate
- (3:38): why the healthcare sector underperformed
- (4:37): the best & worst performing stocks on the ASX this week
- (5:35): the most traded stocks by Bell Direct clients
- (6:02): economic news items to watch out for.
Wall St closed sharply lower on Wednesday as investors responded to disappointing rate outlook out of the Fed’s last FOMC meeting for the year. The Dow Jones posted its 10th straight losing session with a decline of 2.58%, while the S&P500 tumbled 2.95% and the Nasdaq tanked 3.56%. The Fed lowered the US cash rate to 4.25%-4.5% as expected at the final Fed rate meeting of the year but investors were more focused on the commentary out of the Fed that it will only cut rates twice in 2025, which is half the number of cuts previously forecast out of the US central bank.
Over in Europe on Wednesday, market closed slightly higher as investors responded to UK inflation data and awaited the Fed’s rate decision in the US. The STOXX 600 rose 0.16%, Germany’s DAX closed flat, the French CAC rose 0.26%, and, in the UK, the FTSE100 ended the day up 0.26%. UK inflation data showed inflation in the region rose to 2.6% in November which was in line with economists’ expectations.
Across the Asia region overnight, markets closed mixed on Wednesday ahead of Japan’s Central Bank interest rate decision later this week. Japan’s Nikkei fell 0.72%, South Korea’s Kospi Index rose 1.12%, and Hong Kong’s Hang Seng rose 0.95%.
The local market closed virtually flat on Wednesday with a 0.06% close in the red as a sell off in consumer discretionary and financial stocks weighed on gains from industrials and healthcare stocks. The flat reading on Wednesday was due to investors sitting on the sidelines awaiting the Fed’s final rate decision for 2024 due out over the coming days.
Vulcan Energy's shares rose 1.9% after securing a €879 million ($1.4 billion) loan commitment for its €2.2 billion Phase One Lionheart Project in Germany. The financing, involving Export Finance Australia and seven commercial banks, will support the development of Vulcan's geothermal lithium project.
What to watch today:
- Ahead of Thursday’s trading session on the key index the SPI futures are expecting the ASX will open the day down 1.61%, tracking Wall Street’s tumble overnight.
- On the commodities front this morning oil is down 0.34% at US$70.05/barrel, gold is down 2.22% at US$2588/ounce, and iron ore is up 0.16% at US$105.58/tonne.
- The Aussie dollar has weakened against most currencies overnight to buy US$0.62, 96.31 Japanese Yen, 49.69 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage of James Hardie Industries (ASX:JHX) with a buy rating and 12-month price target of $64. The analyst sees James Hardie has significant growth potential in the North American market where it currently has a strong market leadership position. The analyst sees JHX is one of the most defensive and high-quality companies leveraged to the US housing market.
- Trading Central has identified a bullish signal on Humm Group (ASX:HUM) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $0.69 to the range of $0.88 to $0.92 according to standard principles of technical analysis.
Over in the US on Tuesday, all eyes are on the Fed as the final FOMC meeting for 2024 kicks off today with the expectation that the US central bank will announce a second cut to the nation’s cash rate to end 2024 with a cash rate of 4.25% to 4.5%. The Dow Jones broke a record overnight after posting its 9th straight losing day, the longest streak since 1978, while the S&P500 lost 0.4% and the Nasdaq ended the day down 0.32%.
Across Europe overnight, markets closed mostly lower as investors await key central bank decisions out later in the week. The STOXX 600 fell 0.41%, Germany’s DAX lost 0.33%, the French CAC rose 0.12%, and, in the UK, the FTSE100 ended the day down 0.81%. The Bank of England meets on Thursday this week with markets pricing in only a slight chance of a final rate cut for the year.
And across the Asia region on Tuesday, markets closed lower with Japan’s Nikkei falling 0.24%, while South Korea’s Kospi Index lost 1.29%, and Hong Kong’s Hang Seng ended the day down almost half a percent.
The local market overturned the recent red run to close higher on Tuesday as a rebound in healthcare stocks and the big banks boosted the key index to a 0.78% gain at the market close. Industrials stocks led the gains on Tuesday followed by the two growth sectors of tech and real estate, while materials and energy stocks came under pressure following the release of weak economic data out of China on Monday.
ANZ Roy-Morgan consumer confidence data also out yesterday impacted investor sentiment as consumer confidence dropped 1.6 points to 83.9 points in mid-December following a strong period of spending in the Black Friday sales period for Aussie consumers.
Battery metals and tech company Novonix rallied 5.5% yesterday after the company announced it has received a conditional loan worth US$755m from the US department of energy to proceed with the construction of a manufacturing plant in Tennessee for the production of synthetic graphite, a key ingredient of lithium-ion batteries.
Star Entertainment Group’s challenges escalated yesterday after Kate Williams, who was appointed deputy company secretary in July this year, became the latest of a number of the leadership team to stand down amid a very challenging time for the casino operator over the last 12-months. Just days ago, Mark Mackay resigned as Chief Executive Officer of the Star’s Gold Coast operations effective immediately, after just over 3 months in the role. Shares in Star are down 63% YTD. The casino operator did however also announce today the appointment of a new group CFO, Mr Frank Krile who, if approved through required processes, brings extensive experience from his time at Lendlease.
Data 3 shares tumbled 9.84% after the company announced changes to the incentives it receives for the provision of Microsoft services effective from January 1, 2025. The reduction in incentives earned by Data 3 from its provision of Microsoft services is expected to impact FY24 gross profit by 3% but is not expected to have a material impact on future earnings according to the release by Data 3 yesterday.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open Wednesday’s session down 0.17% taking lead from Wall Street’s slide overnight.
- On the commodities front this morning, oil is trading 1.18% lower at US$69.87/barrel, gold is down 0.25% at US$2644/ounce, and iron ore is up 0.1% at US$105.41/tonne.
- The Aussie dollar has further weakened against the greenback overnight to buy US$0.63, 97.23 Japanese Yen, 50 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has maintained a sell rating on Fortescue (ASX:FMG) but have raised the 12-month price target on the mining giant following some recent share price appreciation. The analyst sees slight EPS growth in 2025 based on slightly higher iron ore pr
Join us as we conclude our 2024 Meet the Analyst series with a bang. Our Market Analyst, Grady Wulff, sits down with Bell Potter’s analysts John Hester and Thomas Wakim for a comprehensive discussion on the healthcare sector.
From deciphering Neuren Pharmaceuticals (ASX:NEU) share price fluctuations to anticipating the news flow that will share 2025 guidance and identifying why Telix Pharmaceuticals (ASX:TLX) and Clarity Pharmaceuticals (ASX:CU6) are stocks to watch in the new year, John and Thomas cover it all in this final episode of the year.
In this video, John and Thomas discuss:
- (1:48): the headwinds & tailwinds facing the healthcare sector
- (7:10): why they are bullish on Neuren
- (13:48): opportunities in healthcare stocks for 2025
- (15:18): what's on their clinical data radar for the upcoming year.
Wall St closed mixed overnight as the Dow fell for the 8th straight session, whilst the Nasdaq closed at another record high. The Dow Jones fell 0.25%, the S&P500 gained 0.38% and the tech-heavy Nasdaq rose by 1.24%.
Over in Europe, markets closed lower as the STOXX600 lost 0.14% with the majority of sectors closing in the red. Losses were led by autos stocks which fell 3%. Germany’s DAX lost 0.45%, the French CAC closed 0.71% lower and over in the UK the FTSE100 ended Monday’s trading session 0.46% in the red.
Locally yesterday the ASX200 fell 0.56% with most sectors closing in negative territory. Losses were led by the materials and real estate sector which dropped by 2.04% and 1.35% respectively. This was offset by the financial sector which rose by 0.17% by market close.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.17% at market open this morning.
-
On the commodities front this morning,
- Oil is trading over 1% lower at 70 US dollars and 56 cents a barrel after economic data coming out of China indicated a weakening aggregate demand from the worlds top oil importer.
- Gold is trading 0.18% higher at 2651 US dollars an ounce and iron ore is trading 0.17% lower at 105 US dollars and 31 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Southern Cross Electrical Engineering (ASX:SXE) with a 12-month price target of $2.25. With a current share price of $1.43, this indicates a share price growth of 57.3% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bearish signal on Lendlease Group (ASX:LLC), indicating that the stock price may fall from the close of $6.43 to the range of $5.65-$5.80, on a pattern formed over 68 days, according to the standard principles of technical analysis.
Wall St closed mixed on Friday as investors reassessed their positions ahead of the Fed’s anticipated rate cut this week at the final FOMC meeting for 2024. The Dow Jones fell 0.2% to track its 7th straight losing session in the longest red run since 2020, while the Nasdaq gained 0.12% on Friday and the S&P 500 ended the session flat.
Across the European region on Friday, markets closed lower as investors reacted to disappointing economic data readings from the region’s largest economies, with UK GDP showing economic contraction by 0.1% in October, and Germany’s exports declined 2.8% in October. The STOXX 600 fell 0.62% on Friday, while Germany’s DAX, the French CAC and UK FTSE100 each lost around 0.15%.
Across the Asia Region on Friday, markets closed lower as investor optimism for further Chinese stimulus faded. Hong Kong’s Hang Seng lost 1.83% on Friday, China’s CSI index fell 2.37%, and Japan’s Nikkei ended the day down 0.95%.
The ASX200 fell 0.41% on Friday as sharp selloff in the materials sector weighed on the key index, while financial and energy stocks were the only sectors to end the day higher. The index had its worst week in months last week as investors took profits from the recent rally that sent the ASX200 to record highs.
DigiCo debuted on the ASX on Friday in a highly anticipated debut that had a very disappointing reception from investors. The data centre infrastructure REIT ended its first session at $4.55/share, down from the $5 of its IPO.
What to watch today:
- Ahead of Monday’s trading session on the ASX, the SPI futures are anticipating the local market will begin the new trading week down nearly half a percent.
- On the commodities front this morning, oil is trading 1.81% higher at US$71.29/barrel, gold is down 1.25% at US$2647/ounce and iron ore is down 0.17% at US$105.31/tonne.
- The Aussie dollar has further weakened to buy US$0.63, 97.63 Japanese Yen, 50.41 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage of Vitrafy Life Sciences (ASX:VFY) with a spec buy rating and 12-month price target of $2.36. Vitrafy aims to become a global leader in cryopreservation by significantly improving cell survival of biological materials. The analyst sees high growth potential in VFY’s three areas of exposure to broad global market themes, each also material in size. Aquaculture & Bovine reproduction, Blood Platelets and Human Cell & Gene Therapy each have global addressable markets over US$3bn in size and have significant growth potential for VFY.
- And Trading Central has identified a bearish signal on Sims (ASX:SGM) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may fall from the close of $12.73 to the range of $11.20 to $11.50 according to standard principles of technical analysis.
This week, key economic news was released which drove both international and global markets. From inflation data readings coming out of both the US and China, to jobs data coming out in Australia, impacting the local market. Grady dives deep into the impact these readings had on the market as we head towards the festive period.
In this week’s wrap, Grady covers:
- (0:25): the final US inflation reading of 2024
- (1:43): China’s easing inflation, signalling sluggish economic recovery
- (2:45): Australian unemployment falling below economist expectations
- (3:33): how the ASX200 performed this week so far
- (4:16): the most traded stocks & ETFs by Bell Direct clients
- (4:42): economic news items to watch out for.
Wall St closed mixed overnight as the Nasdaq closed over 20,000 points for the first time. The Dow Jones fell by 0.22%, the S&P 500 jumped 0.82% and the tech-heavy Nasdaq gained 1.77%.
US inflation data was released overnight with core inflation coming in steady at 0.3% month on month, the same as its previous result and forecast.
Over in Europe, markets closed higher as US inflation data came in as expected. The STOXX 600 closed 0.28% higher with gains led by media stocks which rose 1.4%, whilst retail stocks dropped 1.7%. Germany’s DAX rose by 0.34%, the French CAC gained 0.39% and over in the UK the FTSE100 ended the trading day 0.26% in the green.
Locally yesterday, the ASX200 fell 0.47% with most major sectors closing in the red. Losses were led by the information technology and industrial sectors which fell by 1.35% and 1.02% respectively. This was offset by the real estate sector which gained 0.81%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.45% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.42% higher at 70 US dollars and 25 cents a barrel, gold is trading 0.76% higher at 2716 US dollars an ounce and iron ore is trading 0.67% lower at 105 US dollars and 63 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Champion Iron (ASX:CIA) which has a current share price of $6.11. The buy rating is maintained by Bell Potter as they see upside risk spots in iron ore prices and the shift to higher grade production in the 2nd half of 2025 will likely support average realized prices and earnings amid an iron ore price environment which is generally expected to weaken.
- And Trading Central has identified a bearish signal in Beach Energy (ASX:BPT), indicating that the price may fall from the close of $1.22 to the range of $1.10-$1.12, on a pattern formed over 38 days, according to the standard principles of technical analysis.
Over in the US on Tuesday markets pulled back from the recent rally to end the day lower as investors await key inflation data out in the US on Wednesday US time. The Dow Jones fell 0.35% on Tuesday, the S&P500 lost 0.3% and the tech-heavy Nasdaq ended the day down 0.25%. The inflation data out on Wednesday is a key economic reading as it will influence the Fed’s last rate decision for 2024 which will be handed down at the FOMC meeting between December 17-18.
In Europe overnight, markets closed lower, snapping an 8-day winning streak as investors in the region also await the final inflation reading of the year from the US. The STOXX 600 fell 0.52%, Germany’s DAX lost 0.08%, the French CAC fell 1.14% and, in the UK, the FTSE100 ended the day down 0.86%.
Across the Asia region on Tuesday, it was a mixed session across the markets as fresh stimulus talks out of China boosted some regions to a positive close. China’s CSI index rose 0.74% on Tuesday, Japan’s Nikkei added 0.53%, while Hong Kong’s Hang Seng fell 0.5%.
China’s trade balance data out for November yesterday indicated further economic struggle out of the world’s second largest economy with imports declining 3.9% while exports rose 6.7% which was sharply lower than the 12.7% growth in October.
The ASX had a significant rally in afternoon trade as investors welcomed the RBA holding the nation’s cash rate at 4.35% for the last meeting of 2024, meaning it will remain at this level until the RBA meets again on the 18th February, 2025. Despite the afternoon rally, the key index still closed 0.4% lower on Tuesday as tech and financial stocks weighed on the key index.
The afternoon rally was the result of investors welcoming RBA governor Michele Bullock’s comments of ruling out a rate hike this period as inflation pressures continued to fall including economic growth and wages growth easing since the November meeting.
Investors bought into the miners yesterday on hopes of further stimulus out of China reigniting demand for Australia’s key commodities. Any news and promises out of Chinese officials regarding stimulus packages and boosts to the Chinese economy have led to gains for the local mining sector over the last 12-months, however, it is a reminder to be cautious about buying into the hype rally before seeing material flow through of the stimulus to economic recovery in the world’s second largest economy.
Australian business confidence data also weighed on investor sentiment yesterday after data revealed business confidence plummeted by 8 points in November to -3 points, reversing October’s gains and signalling tougher market conditions and sentiment from Aussie businesses last month.
Insurance Australia Group fell over 1% on Tuesday after the insurance provider said it intends to defend itself against a class action brought to the Supreme Court of Victoria.
What to watch today:
- Ahead of the midweek trading session here in Australia, the SPI futures are anticipating the ASX will open the day down 0.32% tracking Wall Street’s pullback overnight.
- On the commodities front this morning, oil is trading 0.7% higher at US$68.83/barrel, gold is up 1.16% at US$2691/ounce and iron ore is up 2.14% at US$106.34/tonne.
- The Aussie dollar has further weakened overnight to buy US$0.64, 96.96 Japanese Yen, 50.37 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the rating on Pilbara Minerals (ASX:PLS) from a hold to a buy and maintain a 12-month price target on the company of $2.95 following recent share price weakness due to the recent high short position in the company reducing in recent weeks. Bell Potter’s analyst sees lithium markets have stabilised and commodity prices have marginally improved which places PLS as an attractive opportunity given its low-cost asset in a tier one jurisdiction.
- Trading Central has identified a bullish signa
Over in the US on Monday afternoon trade, Wall St has pulled back from record territory as investors look ahead to key inflation data out later this week in the US. The Nasdaq and S&P500 retreated from record highs to end the day down 0.61% and 0.61% respectively, while the Dow Jones ended the day down 0.54%. Nvidia shares lost 2.6% on Monday following a Chinese regulator announcing it is investigating the AI semiconductor giant for potentially violating the country’s antimonopoly law.
In Europe overnight, markets mostly extended the positive run from last week into the new trading week as investors assessed further stimulus talks out of China, a key trading area for Europe. The STOXX 600 rose for an eighth straight session to close 0.14% higher, Germany’s DAX fell 0.19%, the French CAC rose 0.72% and, in the UK, the FTSE100 ended the day up 0.52%. Chinese leaders on Monday promised more proactive fiscal measures and moderately looser monetary policy for next year.
Across the Asia region on Monday, markets closed mixed amid revised economic growth data out of Japan and on the release of China’s November inflation data. Japan’s Q3 GDP growth was revised up from 0.2% to 0.3% on a QoQ basis which topped analysts’ estimates and boosted Japan’s Nikkei to a 0.1% rise on Monday. China’s CPI or inflation data on the other hand was also released on Monday and had the opposite response from investors as inflation in the region rose 0.2% YoY in November which missed expectations and was a decrease from the 0.3% rise in October indicating further sluggish recovery in the region, this led to China’s CSI index falling 0.6% on Monday. Hong Kong’s Hang Seng also fell 0.6% on Monday and South Korea’s Kospi Index ended the day down over 2% on political instability.
The local market had a lacklustre start to the week however recovered from early losses on Monday to end the day with a rise of just 0.03%. Consumer discretionary stocks boosted the market to a positive close yesterday with a rise of 0.64% while the energy sector fell 1.05% tracking the weaker price of oil over recent weeks.
Aussie telco provider Superloop rallied 1.8% on Monday after announcing it has entered a deal to acquire Optus’ subsidiary brand Uecomm for $17.5bn which will add over 2000km of high-capacity fibre assets to Superloop’s brand.
Platinum asset management tumbled 14.35% on Monday after its takeover talks with Regal Partners ended with no deal reached. This was on top of Platinum also announcing its Funds Under Management took a major hit in November.
And capital raisings hit a few companies share prices yesterday with Calix ending the day down 12.22% after announcing the completion of an institutional placement that raised $20m at 75cps, while Paradigm Biopharmaceuticals tumbled 7.76% after raising $16m at 40cps, which is over a 30% discount to the previous closing price of the share.
What to watch today:
- Ahead of Tuesday’s session on the ASX the SPI futures are anticipating the ASX will open the day up just 0.04%.
- On the commodities front this morning, oil is trading 1.95% higher at US$68.51/barrel, gold is up 1.25% at US$2666.13/ounce, and iron ore is down 2.05% at US$104.11/tonne.
- The Aussie Dollar has further weakened overnight to buy US$0.64, 97.70 Japanese Yen, 50.19 British Pence and NZ$1.10.
- We may also see investors react to the RBA’s rate decision and commentary around the last rate decision for 2024 this afternoon where it is widely expected Australia’s central bank will hold the cash rate at the current level of 4.35%.
Trading Ideas:
- Bell Potter has downgraded the rating on Platinum Asset Management (ASX:PTM) from a hold to a sell and have significantly dropped the price target on the company from $1.21 to 74cps following funds under management dropping over 10% in November to $10.957bn and on the back of merger talks ending with Re
Wall St closed mixed on Friday as the S&P 500 finished the week at a record close. The Dow Jones fell 0.28%, the Nasdaq gained 0.81% and the S&P 500 rose by 0.25%.
Over in Europe, markets closed higher on Friday despite the latest political turmoil in France. The STOXX600 rose by 0.2% as investors digested news that a vote toppled the French Prime Minister’s government on Wednesday evening. Germany’s DAX rose by 0.13%, the French CAC jumped 1.31% and over in the UK the FTSE100 fell by half a percent.
Locally on Friday, the ASX200 closed 0.64% lower, with all but one major sector closing in the red. Losses were led by the energy and consumer discretionary sectors which fell by 1.21% and 0.94% respectively. This was offset by the utilities sector which rose by 0.39%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.3% at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.61% lower at 67 US dollars and 20 cents a barrel, gold is trading 0.02% lower at 2633 US dollars an ounce and iron ore is trading over 2% lower at 104 US dollars and 11 cents a tonne.
Trading Idea:
- Bell Potter downgrades its buy rating to a hold for Resource Development Group (ASX:RDG) which has a current share price of 2.4 cents. A hold rating has been recommended as RDG’s share price has come under pressure following shareholder concern regarding parent entity Mineral Resources’ governance affairs.
In a special edition of our Weekly Wrap newsletter, Bell Direct Advantage brings you exclusive insights straight from the helm of the rising stars of the mining industry. Join us as we delve into the captivating world of the ASX’s resources sector. Grady Wulff sits down with six key executives from the Resources Rising Stars summer series. Gain valuable insights into their strategic vision, growth potential, and innovation approaches that are driving their success.
Wall St closed lower overnight as investors await for further economic data including unemployment data coming out in Friday’s trading session. The Dow Jones fell over half a percent, the S&P 500 dropped 0.19% and the tech-heavy Nasdaq lost 0.18%.
US unemployment data for November will be released after local market close tonight with a forecast to maintain at 4.1%, the same as its previous result.
Over in Europe, markets closed higher after the STOXX600 maintained its positive momentum, rising 0.43%. Banks and travel stocks led gains, both up over 2%, whilst oil and gas stocks dropped 0.35%. Germany’s DAX rose 0.63%, the French CAC closed the day 0.37% higher and over in the UK the FTSE100 ended the day 0.16% in the green.
Locally yesterday, the ASX200 rose by 0.15% with half of the major sectors ending Thursday’s trading session positively. Gains were led by the information technology and the consumer discretionary sectors which gained 1.13% and 1.08% respectively. This was offset by the real estate sector which fell by 1.38%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.24% by market open this morning.
- On the commodities front this morning,
- Oil is trading 0.03% lower at 68 US dollars and 52 cents a barrel, gold is trading 0.72% lower at 2631 US dollars an ounce and iron ore is trading 0.2% higher at 106 US dollars and 29 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Perpetual Ltd (ASX:PPT) and has a 12-month price target of $24.76. The current share price of $21.82 indicates a share price growth of 13.5%, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on G8 Education (ASX:GEM), indicating that that the stock price may rise from the close of $1.39 to the range of $1.59-$1.65, on a pattern formed over 90 days, according to the standard principles of technical analysis.
Locally yesterday the ASX200 closed 0.38% in the red with eight of the eleven industry sectors lower. Real estate was down the most, while materials, information technology and energy sectors were the only sectors to close in the green.
In US equities overnight, the S&P500 and the Nasdaq both reached record highs, as technology shares led markets, rallying after strong reports released from Salesforce and Marvell Technology. Tech shares saw the Nasdaq close 1.3% higher, the S&P500 gained 0.61%, while the Dow Jones gained 0.69% or 308 points to close above 45,000 for the first time ever.
European markets were mostly higher. The STOXX 600 up 0.37%, the German DAX up more than 1%, France’s CAC up 0.66%, while the FTSE 100 declined 0.28%.
What to watch today:
- The Australian market is set to open higher this morning, with the SPI futures suggesting a rise of 0.12% at the open.
- In economic data, the GDP growth rate was released yesterday, coming in slightly below expectations at 0.3% for the quarter. Today, Balance of Trade data for October will be released at 11:30am AEDT. The prior reading for September saw Australia’s trade surplus on goods declined, falling short of market expectations.
- In commodities,
- Crude oil is trading lower, settling at US$68.50 per barrel, reversing gains from a rise of 2.7% the previous session, as investors await an important OPEC _ decision on production policy. The decision on output cuts is expected to significantly sway prices.
- Gold is in the green as markets continue to assess the political and monetary outlook
- And iron ore is trading higher, supported by hopes that Beijing will introduce more stimulus measures during its political meetings this month.
Trading Ideas:
- Bell Potter has initiated coverage of Integral Diagnostics (ASX:IDX). The merger between Integral Diagnostics and Capitol Health results in a diagnostic imaging company which operates 151 clinics throughout Australia. Bell Potter’s price target is $3.87 and at IDX’s current share price of $3.04, this implies 27.3% share price growth in a year.
- And Trading Central have identified a bullish signal on Australian Clinical Labs (ASX:ACL) indicating that the stock price may rise form the close of $3.63 to the range of $3.78 - $3.82 over 15 days, according to the standard principles of technology analysis.
On Wall Street overnight the S&P 500 notched another fresh record high ending the day up 0.05%, while the Nasdaq added 0.4% and the Dow Jones underperformed the market with a decline of 0.17%. Key US jobs data also out overnight indicated there were more job openings in October than September with 7.74 million openings which topped Dow Jones estimates of 7.5 million, indicating the labour market is cooling.
In Europe overnight markets closed mostly higher as investors assessed political instability in France. The STOXX 600 rose 0.44%, Germany’s DAX added 0.42%, the French CAC rose 0.3% which was a pullback from earlier gains following France’s PM Michael Barnier turning to special constitutional powers to pass a contested budget bill without parliamentary vote. And, in the UK, the FTSE100 ended the day up 0.56%.
Across the Asia markets on Tuesday, it was a green finish as markets in the region tracked record closes for the S&P 500 and Nasdaq in the US on Monday. Japan’s Nikkei rose 2.22% on Tuesday, Hong Kong’s Hang Seng rose 1%, South Korea’s Kospi index added 1.71%, and China’s CSI index added 0.11%.
The ASX rose 0.6% on Tuesday setting a third record high in the past week and boosting the key index over 8500 for the first time in history during the day. The year-to-date gains for the ASX have now risen to almost 12% buoyed by the strong tech rally this year which has propelled the tech sector up 58% year-to-date. KFC Australia operator Collins Foods (ASX:CKF) lagged the market gains yesterday with a loss over 4% after the company revised FY25 earnings guidance downwards amid a challenging consumer market and sticky inflationary pressures. Zip Co (ASX:ZIP) shares also fell 0.6% after co-founder Larry Diamond sold $100m worth of shares in the buy now, pay later company a day after he resigned from the board to focus on family and philanthropic ventures.
What to watch today:
- Australia’s retail sales data for October released on Monday showed that despite the high cost-of-living environment, Aussies are still spending with retail sales up 3.4% in October compared to a year earlier. Cafes, restaurants, and takeaway services recorded a rise of 2.3% while ‘other retailing’ which includes cosmetics, sport and recreational goods’ rose a significant 8.4%. This rise in retail spend adds to the RBA’s inflation journey headache as retail spend is a key driver of inflation remaining sticky in Australia.
- On the commodities front this morning, oil is trading almost 3% higher at US$70.15/barrel, gold is up 0.12% at US$2645/ounce and iron ore is up 2.81% at US$105.32/tonne.
- The Aussie dollar has slightly weakened overnight to buy US$65.11, 96.88 Japanese Yen, 51.14 British Pence and NZ$1.10.
- Ahead of the midweek trading session in Australia the SPI futures are anticipating the ASX will open the day down 0.35%.
Trading Ideas:
- Bell Potter has initiated coverage of Fenix Resources (ASX:FEX) with a buy rating and a price target of 41cps as the analyst sees the WA-based mining company’s portfolio of low-capital mining assets and integrated logistics networks should continue to underpin robust cash flows, funding growth expenditure and shareholder returns.
- Trading Central has identified a bullish signal on Nick Scali (ASX:NCK) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may rise from the close of $14.47 to the range of $15.40 to $15.60 according to standard principles of technical analysis.
Our local market yesterday started the week in the green, closing 0.14% higher with technology, consumer discretionary and energy in the lead. Overnight, Wall Street saw technology stocks improve. The Nasdaq closed at records to kick off the first trading day of December, up 0.97%. The S&P500 briefly hit an all-time high before closing 0.24% in the green, while the Dow Jones was just under, closing 0.29% lower. Intel was in focus, making strong gains before sharply falling before the close, after announcing its CEO Pat Gelsinger will be retiring. Super Micro Computer (NASDAQ:SMCI) jumped after announcing the search of a new finance chief – this also follows the announcement that the business found no evidence of fraud or misconduct. It’d share price has been on a rollercoaster ride this year due to claims of accounting manipulation. And retail stocks also did quite well, off the back of the Black Friday and Cyber Monday sales, which saw strong gains from Macy’s and Lululemon, among others.
What to watch today:
- The SPI futures are pointing to an improvement, suggesting our local market will open 0.73% higher this morning.
- In commodities,
- The iron ore price should be supported today, with recent data showing that China’s factory activity expanded at its fasted pace in 5 months. This was above expectations, signalling an expansion in activity. Now note, the rate of change is still modest, however it is a pickup in activity for China.
- Gold is trading lower, therefore sector worth watching in early trade today.
- And crude oil is also trading lower, as investors monitor the bullish economic data from China and await the upcoming OPEC+ meeting.
- The US dollar continued its unstoppable run, which has seen the Aussie dollar is back to the bottom end of its recent rage at US$0.65. And buying 96.85 Japanese Yen, 0.51 British pence and NZ$1.10.
Trading Ideas:
- Bell Potter maintains their BUY rating on Northern Star Resources (ASX:NST), a large-scale Australian gold producer with projects in Western Australia and North America. Northern Star Resources and DeGrey Mining (ASX:DEG) announced that they have agreed that NST would acquire DEG by Scheme of Arrangement. Their price target is $19.55 and at NST’s current share price of $16.59, this implies 17.8% share price growth in a year. Bell Potter also have a Speculative Buy rating on DEG with a valuation of $2.15 per share.
- Also in the gold sector, Bell Potter maintains a Buy rating on Gold Road Resources (ASX:GOR), off the back of the Northern Star Resources and DeGrey Mining acquisition announcement. Gold Road Resources are the largest shareholder of DeGrey Mining. Bell Potter’s increased their [roce target from $2.40 to $2.55, and at it’s current share price of $2.04, this implies 25% share price growth in a year.
Wall Street closed in record territory again on Friday to close out a very strong November month for equities with the Dow Jones rising 0.42% to a record 44,910.65, the S&P 500 added 0.56% to a record 6032.38, and the Nasdaq ended the day up 0.83%. Chip stocks rallied on Friday on reports that the Biden administration was considering additional barriers on the sale of semiconductor equipment to China that weren’t as strong as previously expected.
In Europe on Friday, markets closed higher on the back of the latest eurozone inflation data being released indicating a rise to 2.3% in November from 2% in November, which is above the ECB’s target of 2% but in line with economists’ expectations. The STOXX 600 rose 0.96% on Friday, Germany’s DAX rose 1.04%, the French CAC added 0.78% and, in the UK, the FTSE100 ended the day up 0.07%.
Across the Asia region on Friday, markets closed in the mostly red led by South Korea’s Kospi index falling 1.95%, following the release of key economic data in the region. South Korea’s decline was due to industrial production growth falling 0.3% in October compared to September, while Tokyo’s inflation rate rose to 2.6% up from 1.8% in October, which led the Nikkei to fall 0.4% on the rise in inflation. Hong Kong’s Hang Seng rose 0.2% on Friday while China’s CSI index ended the day up 1.14%.
Locally on Friday, the ASX closed out the last trading session for November 0.1% lower as a broad sell off led by REIT stocks offset a strong 0.82% rally for the materials sector. Despite the weakness on Friday, the key index posted 2 record closes in the final trading week of November.
Select Harvest shares fell 5.4% on Friday despite the almond producer reporting a return to profitability through posting NPAT of $1.5m which is a significant turn around from the $114.7m net loss posted in FY23.
And embattled casino operator Star Entertainment hit a record low share price on Friday of 18cps following a rating downgrade from Macquarie. The broker downgraded Star to an underperform rating after the company reported an earnings loss of $27m in the first four months of the new financial year.
What to watch today:
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX to open the first trading day of December up 0.25% on the back of Wall Street’s record close on Friday and ahead of learning how strong the Black Friday sales were on the Friday just gone.
- On the commodities front this morning oil is trading 0.43% lower at US$68.63/barrel, gold is up 0.72% at US$2657.79/ounce and iron ore is up 0.26% at US$102.44/tonne.
- The Aussie dollar has weakened to buy US$0.65, 97.58 Japanese Yen, 51.16 British Pence, and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded the rating on QBE Insurance (ASX:QBE) from a buy to a hold and have raised the 12-month price target on the insurance group from $19.05 to $19.20 following the release of a Q3 trading update including gross written premiums up just 2%, premium rate increases across the group reduced from over 8% a year ago to 4.9% at Q3, and full year guidance unchanged. The reason for the downgrade to a hold is the benign Q3 update against shares performing well over the recent period.
- And Trading Central has identified a bullish signal on Myer (ASX:MYR) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $1.06 to the range of $1.20 to $1.24 according to standard principles of technical analysis.
The US economy showed strength this week, with robust business activity and easing inflation. However, the global economic outlook was less positive, with the Eurozone and UK experiencing renewed downturns. Asia-Pacific economies also released key economic indicators and monetary policy decisions.
In this week’s wrap, Sophia covers:
- (0:16): how the US economy demonstrated resilience
- (1:19): where the Eurozone and UK are facing downturns
- (2:02): how the ASX200 performed this week so far
- (2:21): the best and worst performing stocks this week
- (2:36): the most traded stocks & ETFs by Bell Direct clients
- (3:03): economic news items to watch out for.
Wall St closed lower overnight as the S&P 500 snapped a 7-day winning streak, down 0.38%. The Dow Jones lost 0.3% and the tech-heavy Nasdaq fell 0.6% as Nvidia lowered by 2%.
Other tech companies such as Dell and HP also lost over 11% following weak earnings guidance.US inflation data was also released overnight with core PCE rising by 0.3% in October, which was in line with the forecast and consensus.
Over in Europe, markets closed lower as investor concerns rose over the impact Donald Trump may have on tariffs. The STOXX600 fell 0.2%, with the majority of sectors closing lower. Germany’s DAX lost 0.18%, the French CAC closed 0.72% in the red, whilst over in the UK, the FTSE100 gained 0.2%.
Locally yesterday, the ASX200 rose by 0.57% with all major sectors closing in the green. Gains were led by the consumer discretionary and communication services sectors which rose by 1.03% and 0.87% respectively.
Data for GDP growth rate in Q3 was released yesterday, coming in at 2.8%, which was in line with the forecast and consensus, however fell short of the pervious result of 3%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.26% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.07% lower at 68 US dollars and 71 cents a barrel, gold is trading 0.18% higher at 2636 US dollars an ounce and iron ore is trading 0.05% higher at 102 US dollars and 6 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Elders Ltd (ASX:ELD) and has a current share price of $7.58. The 12-month price target of $9.45 indicates a share price growth of 24.7%, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on Premier Investments (ASX:PMV), indicating that the stock price may rise from the close of $35.23 to the range of $40.25-$41.50, on a pattern formed over 84 days, according to the standard pricniples of technical analysis.
Over in the US on Tuesday markets rallied with the S&P500 and Dow hitting fresh record highs as investors assessed the threat of new tariffs from incoming President-elect, Donald Trump. Trump called for a 25% tariff on products from Mexico and Canada on Monday as well as an additional 10% tax on Chinese goods on top of the 20% already promised on goods from the region, in a bid to stimulate domestic demand within the US economy. Despite the potential impact of the tariffs, the Dow Jones rose 0.3% to a fresh record 44,860.31 points, the S&P500 also rose 0.57% to a fresh record 6,021.63 points and the Nasdaq ended the day up 0.63%.
Across the European markets overnight, markets closed lower as investors in the region digested the implications of Trump’s plans to hike tariffs on China, Mexico and Canada. The STOXX 600 fell 0.5%, Germany’s DAX lost 0.56%, the French CAC fell 0.87%, and, in the UK, the FTSE100 ended the day down 0.4%.
In Asia on Tuesday, markets closed mixed on the back of key economic data being released in the region. Japan’s Nikkei fell 0.87% amid a slowdown in service PPI to a rise of 2.9% YoY from 2.8% in the previous month, while Hong Kong’s Hang Seng rose 0.05%, China’s CSI index added 0.21% and South Korea’s Kospi index ended the day down 0.55%.
The local market closed 0.7% lower on Tuesday dropping from Monday’s fresh record close, as a 3% slide among energy stocks weighed on the key index, despite consumer staples stocks rising over 1% and the tech sector rebounding. The major cause of the sell-off yesterday was due to investor fears of increased tariffs to come from President-elect Donald Trump when he re-enters office.
The fall in energy stocks follows investor hopes of a ceasefire between Israel and Hezbollah that would possibly lead to stability in the price of oil.
Despite investor fears of rising tariff to be implemented when Trump comes into office, investors still found an opportunity in the local market through buying into companies that generate significant revenues from operating in the world’s largest economy.
Reece shares rose 2.2% as the plumbing giant operates in the US, while BlueScope Steel ended the day up 5.6% as investors see opportunity in the earnings potential for these two operators in the North American region.
Webjet shares fell 2% on Tuesday after the travel agent released its first results since demerging from Web Travel Group. For the first half, bookings fell 8%, total transaction value declined 8% to $752m, revenue dropped 1% and NPAT rose just 2.2%, all of which reflected a challenging macroeconomic environment for the online travel agent.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.45% on the back of Wall Street’s slight rally overnight.
- On the commodities front this morning, oil is trading 0.74% lower at US$68.43/barrel, gold is up 0.61% at US$2626/ounce and iron ore is up 0.06% at US$102.01/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy US$0.65, 98.95 Japanese Yen, 51.59 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Kogan.com (ASX:KGN) and maintain a hold rating on the online multi-brand retailer following the release of a trading update for the first 4-months of FY25 including gross sales up 0.4% on the PCP and adjusted EBITDA up 55% on the PCP, with topline growth tracking inline with Bell Potter estimates despite challenging market conditions.
- And Trading Central has identified a bullish signal on Harvey Norman (ASX:HVN) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $4.79 to the range of $5 to 5.06 according to standard principles
Wall St closed higher overnight as Donald Trump nominated Scott Bessent as the new Treasury secretary. The Dow Jones closed at new record highs, up 1%, the S&P 500 jumped 0.3% and the tech heavy Nasdaq gained 0.27%.
Investors were happy that Bessent, the founder of Key Square Group was nominated by Trump for the Treasury secretary role and believe that he will be supportive of the equity market and mitigate some of Trump’s protectionist policies such as his stance on taxing imports.
Over in Europe, markets closed higher as global markets rise. The STOXX600 closed 0.14% in the green with the majority of sectors closing in the green. Gains were led by mining stocks which added 1.21%, whilst oil and gas stocks fell 1%. Germany’s DAX rose by 0.43%, the French CAC gained 0.03% and over in the UK, the FTSE100 rose by 0.36%.
Locally yesterday, the ASX200 closed 0.28% in the green with most major sectors closing in the green. Gains were led by the real estate and health sectors which jumped 1.57% and 1.34% respectively. This was offset by the utilities sector which fell by over 1%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures predicting a rise of 0.21% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 3.1% lower at 69 US dollars and 3 cents a barrel following reports that Israel and Hezbollah could be close to a cease-fire within the coming days.
- Gold is trading 3.29% lower at 2626 US dollars an ounce and iron ore is trading 0.07% lower at 101 US dollars and 95 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on IPD Group (ASX:IPG) and has a current share price of $3.69. The 12-month price target of $5.30 indicates a share price growth of 43.6%, hence the buy rating is maintained.
Wall St closed higher on Friday with the Dow hitting a fresh record as investors shift from the high growth tech sectors to areas of the market that are more economically sensitive. The Dow Jones rose 0.97% on Friday to a record 44,296.51 points, the S&P500 added 0.35% and the Nasdaq ended the day up 0.16%.
Over in Europe on Friday markets closed higher as investors assessed weaker-than-expected economic data which builds the case for central bank rate cuts in the region. The STOXX 600 rose 1.2%, Germany’s DAX added 0.92% despite the country’s business activity falling for a 5th consecutive month, the French CAC rose 0.6% and, in the UK, the FTSE100 ended the day up 1.4%.
Over in the Asia market on Friday, markets in the region closed mostly higher as investors await clarity on how US-imposed tariffs will impact markets in the region when Trump steps into office in the US. Japan’s Nikkei rose 0.7%, South Korea’s Kospi Index gained 0.83%, while China’s CSI index fell 3.1%.
Locally on Friday the ASX 200 rose 0.85% to a fresh record 8393.8 points with all but the tech sector ending the day in the green led by energy stocks rising 2.3%.
A2 Milk Company rose over 13% on Friday after the milk and infant milk formula company announced a revenue guidance upgrade and that the company has established a dividend policy.
WiseTech Global fell 12.4% on Friday after the company downgraded revenue and earnings guidance for FY25 at its AGM amid recent media distractions delaying the launch of key products in the company.
What to watch today:
- Ahead of Monday’s trading session on the ASX the SPI futures are anticipating the local market to open the new trading week up 0.62% extending on the record close on Friday.
- On the commodities front this morning oil is trading 1.54% higher at US$71.18/barrel, gold is up 1.75% at US$2715.85/ounce and iron ore is down 0.07% at US$101.95/tonne.
- The Aussie dollar is buying 65.16 US cents, 100.70 Japanese Yen, 51.85 British Pence, and 1 New Zealand dollar and 12 cents.
Trading Idea:
- Bell Potter has increased the rating on Lovisa (ASX:LOV) from a hold to a buy and have slightly lowered the 12-month price target on the fashion jewellery brand from $31/share to $30/share following the FY25 trading update out of the company for the first 20 weeks of the new financial year including total sales up 10% which is lower than the PCP, and global comparable sales were down on the PCP. New stores opened hit 40 though which is tracking in-line with Bell Potter expectations.
Wall St closed mixed overnight as investors await AI giant Nvidia’s upcoming earnings report. The Dow Jones gained 0.32%, the S&P500 closed flat and the tech heavy Nasdaq fell 0.11%.
Investors are awaiting results from Nvidia whose results could hold more significance than some key economic reports given the chipmakers $3.6 trillion market capitalization which could also impact markets for the rest of the week.
Over in Europe, markets closed lower as investors continue to analyse the ongoing geopolitical tensions. The STOXX600 closed 0.01% lower with half of the major sectors closing in the red. Germany’s DAX fell 0.29%, the French CAC lost 0.43% and over in the UK, the FTSE100 dropped 0.17% by the end of Wednesday’s trading session.
Locally yesterday, the ASX200 fell by 0.57% with the majority of sectors closing in negative territory. Losses were led by the communication services and industrial sectors which dropped 1.53% and 1.31% respectively. This was offset by the health sector which gained 0.27% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.13% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 0.2% lower at 69 US dollars and 10 cents a barrel as investors weigh the current geopolitical tensions against growing crude oil supply in the US.
- Gold is trading half a percent higher at 2648 US dollars an ounce and iron ore is trading 0.13% higher at 101 US dollars and 89 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on PWR Holdings (ASX:PWR and has a 12 month price target of $8. With a current share price of $6.85, this represents a share price growth of 16.8%, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on KMD Brands (ASX:KMD), indicating that the stock price may rise from the close of $0.39 to the range of $0.48-$0.50, on a pattern formed over 30 days, according to the standard principles of technical analysis.
Wall Street closed higher on Tuesday despite rising geopolitical tensions between Russia and Ukraine. The Nasdaq led the gains with a rise of 1% as Nvidia popped 5% ahead of the release of its earnings results out on Wednesday. The S&P500 ended Tuesday’s session up 0.5% and the Dow Jones reversed early session losses to close 0.1% higher.
Walmart shares are up over 5% after the US retail corporation posted better-than-expected earnings and hiked its outlook on strong discretionary spend in the US. While Lowe’s, the home improvement retailer, fell over 3% on Tuesday after saying it expects sales to decline in 2024.
In Europe overnight, markets closed lower in the region as investors assess a spike in geopolitical tensions centred on Russia. The STOXX 600 fell 0.45%, Germany’s DAX and the French CAC each lost 0.67%, while in the UK, the FTSE100 ended the day down 0.13%.
Across the Asia region on Tuesday, markets closed higher on the back of Wall Street’s rally on Monday. China’s CSI index rose 0.67%, Hong Kong’s Hang Seng added 0.4%, Japan’s Nikkei rose 0.51% and South Korea’s Kospi index ended the day up 0.12%.
The local market extended its green run into Tuesday with the key index gaining 0.9% to a fresh record high at close of 8374 points driven by the Nasdaq on Wall St on Monday, optimism of greater stimulus out of China and gold miners rebounding on a rise in the price of the precious commodity.
The RBA meeting minutes released yesterday painted clear picture about where Australia’s central bank is focused in regard to inflation drivers before even considering interest rate cuts. The minutes outlined that consumer spending, labour productivity and the outlook for the global economy remain uncertain and are the key drivers of inflation and the inflationary outlook impacting the RBA’s decision. The minutes also outlined that underlying inflation is not expected to return to the sustainable target until 2026.
Stock specifically yesterday TechnologyOne shares did most of the heavy lifting for our tech rally with a gain of 10.1% after the SaaS company posted a 15% increase in full-year net profit to $118m while revenues rose 17%.
On the retail front KMD Brands fell over 3.8% on Tuesday after the Rip Curl parent company warned of cautious consumer sentiment after posting a decline in quarterly sales. Retailers have begun offering black Friday sales early across the board in a bid to reduce inventory levels.
What to watch today:
- Ahead of the midweek trading session on the ASX the SPI futures are expecting the local market to open the day down 0.12%, easing from yesterday’s record close.
- On the commodities front this morning, oil is trading 0.23% higher at US$69.36/barrel, gold is up 0.65% at US$2629/ounce and iron ore is up 0.13% at US$101.76/tonne.
- The Aussie dollar has strengthened against the greenback overnight to buy US$0.65, 100.83 Japanese Yen, 51.38 British Pence, and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Gentrack Group (ASX:GTK) from $10.90 to $11.50 per share and maintain a buy rating on the specialist billing and CRM solutions provider to managed services. The target price increase is ahead of GTK’s full year results being released on 26th November and the analysts’ bullish outlook on the company’s ability to maintain customer win momentum.
- And Trading Central has identified a bullish signal on Centuria Capital (ASX:CNI) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may rise from the close of $1.89 to the range of $2.15 to $2.23 according to standard principles of technical analysis.
Wall Street returned to mostly rally mode on Monday with the Nasdaq leading the gains, posting a rise of 0.6% at the closing bell while the S&P500 added 0.4% but the Dow Jones ended the day down 0.1%. Tesla shares popped 5.6% on Monday amid reports President Elect Donald Trump’s team is working on ways to ease self-driving regulations, while Nvidia shares lost 1.3% as investors await earnings out of the semiconductor giant.
Across Europe overnight, markets closed mixed in the region as investors await key inflation data out later this week from the Eurozone and the UK, while a slew of CPI readings are also due out this week across Europe. The STOXX 600 fell 0.1% on Monday, Germany’s DAX closed flat, the French CAC rose 0.12% and, in the UK, the FTSE100 ended the day up 0.6%.Over in the Asia region, markets closed mixed to start the week as investors await key economic data out in the region this week including Japan’s inflation data and China’s loan prime rate.
China’s CSI index ended Monday’s session down almost half a percent, Japan’s Nikkei fell 1.09%, South Korea’s Kospi index gained 2.16% and Hong Kong’s Hang Seng rose 0.82%.The local market started the week in positive territory with a 0.2% gain as investors hope further stimulus out of Beijing will increase demand for Aussie exports especially in the mining space. Consumer staples and utilities stocks led the rally on Monday with gains of 1.95% and 1.82% respectively, while health and tech, the two growth sectors, ended Monday’s session with losses of 0.88% and 0.79% respectively.
Russia’s most recent move to cut exports of enriched uranium to the U.S. boosted local uranium miners on Monday, with Boss Energy rising 7.3% while Paladin Energy rose over 5%.Gold miners also felt some relief yesterday as the post-election USD rally eased and the gold price rebounded to trade 1.2% higher at US$2592.95/ounce. Northern Star Resources, Evolution Mining and Gold Road Resources each ended Monday’s session in the green.
What to watch today:
- Ahead of Tuesday’s trading session on the ASX the SPI futures are anticipating the local market to open the new trading day 0.11% higher. We may see investors react to the release of the RBA’s latest meeting minutes out today in Australia as investors will digest the RBA’s remarks and determine if rate cuts are on the horizon.
- On the commodities front this morning, oil is trading 2.63% higher at US$68.79/barrel, gold is up 1.87% at US$2610/ounce and iron ore is down 0.6% at US$101.63/tonne.
- The Aussie dollar has further weakened against the greenback to buy US$0.64, 100.61 Japanese Yen, 51.13 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage of Alfabs Australia (ASX:AAL) with a buy rating and a price target of 40cps as Bell Potter’s analyst sees this is a good buying opportunity for the diversified Australian industrial services group given it is relatively undervalued with an attractive NPAT and compound annual growth rate outlook of 21.8% p.a. over FY24-27.
- Trading Central has identified a bearish signal on IRESS (ASX:IRE) following the formation of a pattern over a period of 48-days which is roughly the same amount of time the share price may fall from the close of $9.48 to the range of $8.95 to $9.05 according to standard principles of technical analysis.
Wall St closed lower on Friday as investors maintain concerns over US interest rates. The Dow Jones fell 0.7%, the S&P500 lost 1.32% and the tech-heavy Nasdaq dropped 2.24%.
Investor concerns for US interest rates rose, when Federal Reserve Chair, Jerome Powell, commented that the central bank “wasn’t in a hurry” to cut interest rates.
Over in Europe, markets closed lower, recording a fourth consecutive weekly decline. The STOXX600 fell 0.76% with media stocks dropping 3%, whilst mining stocks gained 1.3%. Germany’s DAX lost 0.27%, the French CAC dropped 0.58% and over in the UK the FTSE100 ended Fridays trading session down 0.09%.
Locally on Friday, the ASX200 gained 0.74% with all but one major sector closing in the green. Gains were led by the utilities and financial sectors which rallied 2.39% and 1.46% respectively. This was offset by the health sector which lost 1.76%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.31% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.45% lower at 67 US dollars and 2 cents a barrel as OPEC cut its 2025 demand outlooks.
- Gold is trading 0.17% lower at 2562 US dollars an ounce and iron ore is trading 0.58% lower at 101 US dollars and 63 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Aspen Group (ASX:APZ) and has a current share price of $2.40. Bell Potter’s 12-month price target of $2.75 shows a 14.6% share price growth over a year, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Helloworld Travel (ASX:HLO) , indicating that the stock price may rise from the close of $2.04 to the range of $2.25-$2.31, on a pattern formed over 49 days, according to the standard principles of technical analysis.
This week, several ASX-listed companies provided quarterly updates as we close out Q1. Among those reporting were Commonwealth Bank, James Hardie, and Xero. Additionally, check out Grady’s insights on the key themes for FY25 as depicted in Q1 results.
In this week’s wrap, Grady covers:
- (0:23): CBA soared to record highs, but what does the outlook suggest?
- (2:05): Xero maintains profitability, how did markets react?
- (3:54): the key themes and outlook for FY25
- (5:15): how the ASX200 performed this week so far
- (6:17): the most traded stocks & ETFs by Bell Direct clients
- (6:47): economic news items to watch out for.
Wall St extended its post-rally breather into Wednesday with the major averages ending the day mostly flat. The Dow Jones rose 0.11%, the S&P500 added just 0.02% and the tech-heavy Nasdaq ended the day down 0.26%.
The US CPI index for October showed inflation rose to an annual rate of 2.6% which met economists’ expectations and was a slight uptick from the 2.4% reported in September. Core inflation which excludes food and energy rose 3.3% in the last month which also met expectations.
Over in Europe on Wednesday, the global market pullback extended into the Euro region with the STOXX 600 falling 0.17%, while Germany’s DAX lost 0.16%, the French CAC fell 0.14% and, in the UK, the FTSE100 ended the day up just 0.06%.
Across the Asia region overnight, markets in the region mostly fell in line with the global market sell off and as investors assessed corporate goods data out of Japan showing YoY price growth reached its highest level since July 2023, for the month of October with a reading of 3.4%. China’s CSI index rose 0.62%, while Hong Kong’s Hang Seng fell 0.45%, Japan’s Nikkei lost 1.66% and South Korea’s Kospi index ended the day down 2.64%.
Locally yesterday, the ASX200 tumbled 0.75% taking lead from Wall Street’s losses on Tuesday US time, as investors took a breather from the recent post-election rally. 10 of the 11 sectors on the ASX ended Wednesday’s session in the red led by financials stocks falling 1.07%.
CBA shares fell almost 0.5% on Wednesday after the leading Aussie bank released a quarterly trading update including operating income out 3.5%, OpEx up 3%, and unaudited statutory NPAT of $2.5bn. CBA shares hit a record $150/share on Tuesday and a vast number of market participants continue to question whether this valuation is fair or if the bank is overvalued.
Building materials producer James Hardie Industries bucked the sell-off on Wednesday to close higher despite outlining profit dropped 23% in Q2FY25 results out yesterday due to weakness in Europe and China, while its North American division, the key driver of revenue, is expected to continue growing into FY26.
In economic data out yesterday, Australia’s wage price index rose at the weakest level since Q4 2022 with a QoQ rise of just 0.8% and an annual rise of 3.5%, both of which fell short of economist’s expectations and provide a strong sign of inflation easing in Australia as wages inflation has been a key driver of the stickiness of inflation in recent months.
What to watch today:
- Ahead of Thursday’s trading session in Australia the SPI futures are anticipating the ASX will open the day up 0.35% despite the global market turbulence overnight.
- On the commodities front this morning, oil is trading 0.24% lower at US$67.95/barrel, gold is down 1.18% at US$2575.86/ounce and iron ore is down 0.14% at US$102.96/tonne.
- The Aussie dollar has weakened again overnight against the greenback to buy US$0.65, 100.83 Japanese Yen, 51.20 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Light and Wonder (ASX:LNW) from $165 to $180 and maintain a buy rating on the gaming technology provider following the release of the company’s Q3 update including 12% YoY revenue growth and adjusted NPATA of US$122m which is growth of 23% YoY. The company’s outlook target of FY25 AEBITDA at US$1400m was reaffirmed.
- And Trading Central has identified a bearish signal on South32 (ASX:S32) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may fall from the close of $3.54 to the range of $3.19 to $3.27 according to standard principles of technical analysis.
The Wall Street post-election rally took a breather on Tuesday from the record highs set across the major averages in recent sessions. The Dow Jones fell 0.86%, the S&P500 lost 0.3%, and the Nasdaq ended the day down 0.09%. Treasury yields also climbed on Tuesday with the 10-year adding around 10 basis points which also weighs on investor appetite for equities.
In Europe overnight, markets closed lower in the region as investors digested what the Trump White House could mean for the eurozone economy. The STOXX 600 fell 2.01% as mining stocks led the losses, while Germany’s DAX fell 2.13%, the French CAC lost 2.7% and, in the UK, the FTSE100 ended the day down 1.22%.
Across the Asia markets on Tuesday, it was a sea of red to end the trading day as investors assessed key economic data out in the region including retail sales and business confidence data. Japan’s Nikkei fell 0.4% on Tuesday, China’s CSI index lost 1.1%, Hong Kong’s Hang Seng tumbled 2.84% and South Korea’s Kospi Index ended the day down 1.94%.
The local market started the week lower as miners weighed on the local index amid weakened commodity prices across the board on China’s lacklustre stimulus and demand outlook. The ASX closed 0.13% lower on Tuesday as a sharp selloff in materials and energy stocks offset a near 1.4% rally among tech stocks.
Uranium miner Paladin Energy tanked over 20% on Tuesday after the company cut its production guidance for FY25 at its Langer Heinrich Mine in Namibia amid ongoing challenges and operational variability to date that is impacting the ramp up in production at the mine. The new FY25 production guidance from the Langer Heinrich Mine is expected between 3-6m pounds of uranium, below the previously issued guidance of 4-4.5m pounds and management withdrew all other guidance for FY25.
A boom in New Zealand-based claims for insurer NIB is expected to hit profits for the first half, as NIB said ‘extraordinary growth in NZ claims’ would result in an operating loss in the first half of around $10m. Shares in NIB fell 0.7% on Tuesday.
Westpac Consumer Confidence for November and NAB Business confidence for October were released yesterday with both strongly beating economists’ forecasts. Consumer confidence decreased slightly to 5.3% from 6.2% in October but this was well above the forecast of a decline to minus 0.8%, while business confidence rose to 5 points in October from minus 2 points in September and beat the market expectations of a rise to 2 points. Easing inflation was the driver of the boost in confidence readings.
What to watch today:
- Ahead of the midweek session here in Australia the SPI futures are anticipating the ASX to open the day down 0.98% on the back of the global market sell off on Tuesday.
- On the commodities front this morning, oil is trading 0.39% higher at US$68.31/barrel gold is down 1.11% at US$2595/ounce and iron ore is down 0.7% at US$103.10/tonne.
- The Aussie dollar has weakened against the greenback to buy US$0.65, 100.92 Japanese Yen, 51.10 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage of Woolworths with a hold and a 12-month price target of $31.75. The analyst says the recent share price correction follows the commencement of legal action by the ACCC and softer 1H25 guidance.
- Bell Potter has initiated coverage of Perenti (ASX:PRN) with a buy rating and a 12-month price target of $1.47 with the analyst noting shares should appeal to investors as they trade 6x under FY25 EPS, offer high cash generation, a discount NTA of $1.26/share and offer a 6% yield with an approx. 3% buyback planned. The buy is also supported by higher mining and drilling demand for gold in Australia and Africa.
Wall St closed higher to start the trading week as the Dow Jones closes above 44,000 for the first time ever, jumping 0.69%. The S&P500 rose by 0.1% and the tech-heavy Nasdaq gained 0.06%.
In terms of US stocks, JP Morgan Chase and Goldman Sachs rallied 1.1% and 2.3% respectively as investors hope that Trump’s election into the white house could lead to easier regulation in the banking sector.
Over in Europe, markets closed higher ahead of important economic data readings this week including inflation readings in Germany and the US and GDP readings in the UK. The STOXX600 closed 1.1% higher with the majority of sectors closing Monday’s trading session in
the green, with construction and materials stocks gaining 2%. Germany’s DAX rose 1.21%, the French CAC gained 1.2% and over in the UK, the FTSE100 closed Monday’s trading session 0.65% higher.
Locally yesterday, the ASX200 closed 0.35% lower to start the trading week. Losses were led by the materials and consumer staples sectors which fell 2.8% and 1.84% respectively. This was offset by the information technology sector which rose 1.39%.
What to watch today:
- The Australian share market is set to open flat, with the SPI futures suggesting a slight rise of 0.01% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 3.09% lower at 68 US dollars and 21 cents a barrel after China’s economic stimulus measures fell short of expectations, increasing concerns for the demand for oil.
- Gold is trading 2.3% lower at 2622 US dollars an ounce and iron ore is trading 1.33% lower at 103 US dollars and 82 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Infomedia (ASX:IFM) and has a 12-month price target of $1.78. The current share price of $1.29 predicts a 12-month share price growth of 37.5%, hence the buy rating is maintained.
- Trading Central has identified a bearish signal in Treasury Wine Estates (ASX:TWE), indicating that the stock price may fall from the close of $11.01 to the range of $9.30-$9.70, on a pattern formed over 35 days, according to the standard principles of technical analysis.
Wall St topped record territory on Friday with the S&P500 and Dow Jones ending the day at fresh record highs in the wake of Trump’s election victory and the Fed cutting interest rates by 25-basis points late last week. The S&P500 rose 0.38% to a fresh record 5,995.54 points, while the Dow Jones rose 0.6% to a fresh record 43,988.99 points and the Nasdaq ended the day up 0.09%.
Despite the rally, investors are concerned about the large federal deficit and increased tariffs sparking fears of an uptick in inflation in the US.
Across European markets on Friday, markets in the region closed lower as investors assessed key corporate results and rate cuts out of the Bank of England and US Fed. The STOXX 600 fell 0.66%, Germany’s DAX fell 0.8%, the French CAC lost 1.17% and, in the UK, the FTSE100 ended the day 0.84%.
Shares in British Airways owner company IAG rose 6% on Friday after reporting a 15% uptick in third-quarter profit which beat analysts’ expectations.
The Asia region closed mixed on Friday after China’s central government announced it would allocation a further 6 trillion yuan too local governments to help tackle debt issues.
Locally on Friday the ASX 200 rallied sharply, ending the day up 0.84% led by a surge in tech stocks while the energy sector was the only sector to end the day in the red. For the week the ASX had its best week since mid-August with a gain of 2.17%. Further stimulus out of China and another rate cut in the US were the drivers of the local rally on Friday.
Leading global geolocation tracking tech provider Life 360 soared to a record high on Friday after UBS raised its price target on the company’s US shares from US$35 to US$50.
Biotech company Neuren soared a further 14% on Friday extending its rally of the last few sessions after reporting strong US sales of its Daybue drug which is used for the treatment of Rett Syndrome.
Elsewhere in the healthcare space, Mayne Pharma rose 14% on Friday after the AFR reported Jefferies Australia has been quietly marketing the company to prospective buyers.
What to watch today:
- Ahead of the first trading session of the new week, the SPI futures are anticipating the ASX to open the day down 0.43%.
- On the commodities front this morning, oil is trading 2.74% lower at US$70.38/barrel, gold is down 0.83% at US$2684/ounce and iron ore is down 1.33% at US$103.82/tonne.
- The Aussie dollar is buying US$0.65, 100.56 Japanese Yen, 50.92 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the 12-month price target on REA Group (ASX:REA) from $239 to $258 and maintain a buy rating on the leading online property advertising and service-related tech company following the release of the company’s 1Q 25 trading update including listings growing 7%, group revenue up 21%, and the outlook for double-digit buy yield growth.
- And pre-IPO company Cuscal (ASX:CCL) told the market on Friday that it has excess demand for the shares on offer as part of an IPO with the payment’s infrastructure company preparing for its market debut on November 21 where it hopes to raise $136m with a $437m market value on debut.
This week saw global markets rally in anticipation of the outcome of the US Presidential Election earlier this week. Wall Street rallied following Donald Trump’s second win of the US presidential election, with the major averages reaching record highs at the closing bell on Wednesday.
In this week’s wrap, Grady covers:
- (0:42): why the gold price took a hit this week
- (1:22): EV giant Tesla’s share price jump
- (2:12): how energy & industrials performed this week
- (3:27): stock & sector beneficiaries of the Trump victory
- (4:51): how the ASX200 performed this week so far
- (5:40): the most traded stocks & ETFs by Bell Direct clients
- (6:10): economic news items to watch out for.
Wall St ended Wednesday’s trading session with its major benchmarks hitting record highs as Donald Trump regained the title of President of the United States of America. The Dow Jones had its best day since 2022 jumping 3.57%, the S&P 500 rose by 2.53% and the tech-heavy Nasdaq gained 2.95%.
In terms of US shares, Tesla whose CEO, Elon Musk is seen as a massive backer of Trump saw shares jump 14%, whilst bank shares also saw a rise with JP Morgan climbing 10% and Wells Fargo rallying 12%.
Over in Europe, European markets close lower as investors react to Donald Trump winning the US election. The STOXX600 fell 0.59% with the majority of sectors ending the trading day in the red. Losses were led by the utilities sector which fell 2.61%, whilst financial services stocks gained 1.84%. Germany’s DAX lost 1.13%, the French CAC dropped over half a percent, and over in the UK the FTSE100 ended Wednesday’s trading session 0.07% lower.
Locally on Wednesday the ASX200 rose 0.8% with 8 of the 11 sectors ending the day in the green. Dual listed companies in the US and Australia felt an extra boost yesterday on the back of the election rally with Light & Wonder rising 4.7%, while News Corp added 4% and Block Inc. surged 4.1%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.24% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.05% lower at 71 US dollars and 94 cents a barrel as investors react to the potential impact Trump’s election will have on the energy market.
- Gold has fallen 3.08% to 2661 US dollars an ounce following the strengthening value of the US dollar.
- And iron ore is trading 1.14% higher at 105 US dollars and 9 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Austal Limited (ASX:ASB) and has a 12-month share price target of $3.75. The current share price of $3.25 shows a 15.4% share price growth over the next 12-months, hence the buy rating is maintained.
- And Trading Central has indicated a bullish signal on Aspen Group (ASX:APZ), indicating that the stock price may rise from the close of $2.19, to the range of $2.58-$2.66, on a pattern formed over 27 days, according to the standard principles of technical analysis.
With the US election voting happening now, the markets responded with a rally on Wall St on Tuesday as the outcome of the election is expected to be tight between Kamala Harris and former President Donald Trump. The S&P500 rose 1.23% on Tuesday, while the Nasdaq added 1.43% and the Dow Jones ended the day up 1.02%.
Based on historical data, the major averages tend to rally between Election Day and the end of the year, but investors should brace for some choppiness especially if there is uncertainty over the outcome of the election.
Over in Europe overnight, markets closed mostly higher as global markets await the outcome of the US election. The STOXX 600 rose 0.06% led by industrials stocks rallying 1.2%, while Germany’s DAX added 0.6%, the French CAC rose 0.5% and, in the UK, the FTSE100 ended the day down 0.14%.
In Asia on Tuesday markets closed mixed ahead of the outcome of the US election and on the back of the RBA holdings rates on Tuesday in Australia. Japan’s Nikkei rose 1.43% while South Korea’s Kospi Index fell 0.47%, and China’s CSI index rose 2.29% after China’s services sector in October grew at its fastest rate in three months climbing to 52 points in October from 50.3 points in September.
The ASX had a light day of trading yesterday due to the Melbourne Cup, but markets still closed lower by 0.4% as investors responded to the RBA holding the nation’s cash rate at 4.35% for the period ahead. RBA Governor Michele Bullock signalled the RBA is not comfortable enough to say inflation is sustainably in the target band and more data is needed to convince the central bank that the recent ease of inflation is not just temporary.
There was a lot of movement stock specific wise yesterday with Domino’s Pizza falling 6.3% after the company’s Chief Executive Don Meji announced he will be exiting the company after 22-years leading the Pizza giant. The announcement came amid weak sales outlined in the latest trading update.
Mineral Resources shares recovered 4.1% yesterday, a day after news hit that the mining giant’s founder Chris Ellison would step down in the next 18-months after board found he was allegedly using company resources for personal business.
And emerging copper-gold miner Firefly Metals rallied 1.6% yesterday after RBC Capital Markets initiated coverage on the company with an outperform rating.
What to watch today:
- Ahead of the midweek trading session the SPI futures are anticipating the ASX to open the day up 0.75% on the back of Wall Street’s rally.
- On the commodities front this morning, oil is trading 1.05% higher at US$72.22/barrel, gold is up 0.22% at US$2741/ounce and iron ore is up 1.4% at US$103.91/tonne.
- The Aussie dollar is buying US$0.66, 100.65 Japanese Yen, 50.85 British Pence and NZ$1.11 cents.
Trading Ideas:
- Bell Potter has reduced the 12-month price target on Talga Group (ASX:TLG) from $2.35 to $1.90 and maintain a speculative buy rating on the battery materials and technology company after the company received a positive update in relation to its Natura 2000 environmental permit for its Nunasvaara natural graphite project in Sweden. The permit issued by the Mining Inspectorate of Sweden provides Talga the rights to conduct mining activities over a period of 25-yeas with options for extension. With this in mind, Bell Potter’s analyst now adjusted the timeline to production allowing for construction commencing in Q3, 2025 and first production in CY27. The reduction in price target is due to adjustments on timing and dilution expectations heading into production.
- And Trading Central has identified a bearish signal on Aussie Broadband (ASX:ABB) following the formation of a pattern over a period of 32-days which is roughly the same amount of time the share price may fall from the close of $3.63 to the range of $3.22 to $3.30 according to standard principles of technical ana
Wall St closed lower overnight as investors await results from the US federal election this week. The Dow Jones fell 0.61%, the S&P500 lost 0.28% and the tech-heavy Nasdaq dropped 0.33%.
Over in Europe, markets closed lower with the STOXX600 closing 0.3% lower. Technology stocks were the biggest losers, lowering 1.1%, whilst banks gained 0.7%. Germany’s DAX lost 0.56%, the French CAC dropped half a percent and over in the UK the FTSE100 closed slightly higher by 0.09%.
Locally yesterday, the ASX200 closed 0.56% higher with the majority of sectors closing in the green by the closing bell. Gains were led by the information technology and utilities sectors which rose by 1.71% and 1.7% respectively. This was offset by the energy sector which fell by 0.71% by the end of the trading day.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.4% by market open this morning.
- In terms of economic news, the RBA interest rate decision will be released today with a forecast and consensus for it to stay steady at its previous result of 4.35%. The US presidential results will also be announced after local market close today.
- On the commodity front this morning,
- Oil is trading 3.12% higher at 71 US dollars and 71 cents a barrel as there are concerns that Iran may strike back at Israel in the coming days.
- Gold is trading flat at 2736 US dollars an ounce and iron ore is trading 1.29% lower at 102 US dollars and 49 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on AV Jennings Limited (ASX:AVJ) and has a current 12-month price target of $0.45. The current share price of $0.30 indicates a share price growth of 50%, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal in Resimac Group (ASX:RMC) , indicating that’s the stock price may rise from the close of $0.89 to the range of $1.01-$1.03, on a pattern formed over 74 days, according to the standard principles of technical analysis.
Wall Street closed higher at the close of the first trading session for November despite the release of a weaker-than-expected jobs report out in the U.S. The unemployment rate held at 4.1% in October, but the US economy added just 12,000 jobs over the month which fell well short of economists’ expectations of 100,000 jobs being added.
The Nasdaq gained 0.8% on Friday, the S&P500 rose 0.41% and the Dow Jones ended the day up 0.7%.
Amazon rallied over 6% on the back of stellar quarterly results while Intel also added 7.8% on strong revenue and guidance exceeding expectations.
Over in Europe on Friday markets in the region closed higher, rebounding from 3 negative sessions. The STOXX 600 rose 1.1%, Germany’s DAX added 0.93%, the French CAC gained 0.8% and, in the UK, the FTSE100 ended the day up 0.83%.Across the Asia markets on Friday, it was mostly a sea of red led by Japan’s Nikkei falling 2.6% after the bank of Japan held interest rates steady for the next period. China’s manufacturing purchasing managers index for October came in at 50.3 points which topped economists’ expectations and showed a positive uptick in economic output in the region.
Locally on Friday the ASX200 fell half a percent to close at the lowest level in 7-weeks as investors reacted to Q3 producer price index data coming in lower than expected with an annual rise of 3.9% compared to the 4.8% economists were expecting. The price of gold rose 6% over October which propelled gold miners on the ASX with tailwinds expected to continue for the foreseeable future while oil prices steadied on Friday following weeks of volatility.
What to watch today:
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX will open the day up 0.44%.
- On the commodities front this morning, oil is trading 0.33% higher at US$69.49/barrel, gold is down 0.4% at US$2736/ounce, and iron ore is down 1.24% at US$104.29/tonne.
- The Aussie dollar is buying 65.81 US cents, 50.86 British pence, 100.55 Japanese yen and 1 New Zealand dollar and 10 cents.
Trading Ideas:
- Bell Potter has slightly reduced the 12-month price target on Nickel Industries (ASX:NIC) from $1.47 to $1.43 and maintain a buy rating on the leading global nickel producer following the release of the company’s September quarter results. During the quarter, Nickel Industries reported nickel production was below BPe, cash costs were 10% above BPe, and production from the company’s Hengjaya mine nearly doubled. The reduction in the 12-month price target is due to lower FY24 earnings which are slightly offset by the establishment of an increased production profile at the Hengjaya Mine.
- And Bell Potter has reduced the 12-month price target on MedAdvisor (ASX:MDR) from 62 cps to 55cps and maintain a buy rating on the healthcare tech company following the release of the company’s Q1 results which were softer than expected but not worth the considerable sell-off experienced on the day of the results being released.
The ASX200 declined in October due to a slump in utilities and consumer staples. Key themes this month included volatile oil prices, strong gold prices, and mixed US tech earnings. While Australian headline inflation eased, core inflation remained elevated, impacting the RBA’s rate-setting decisions.
In this week’s wrap, Grady covers:
- (0:11): how the ASX200 performed in October
- (1:29): quarterly earnings results released this month
- (2:42): why the Nasdaq reported a fresh record high
- (4:30): the best performers on the ASX200 this week
- (5:16): the most traded stocks by Bell Direct clients
- (5:48): economic news items to watch out for.
Wall Street slipped on Wednesday as investors digested the first release of mega cap earnings results for Q3. The Nasdaq fell 0.56% a session after the tech heavy index posted a fresh record high, while the S&P500 and Dow jones lost 0.33% and 0.22% respectively.
Alphabet, Google’s parent company, kicked off the mega cap earnings results with a beat of analysts’ expectations driven by strong demand for the company’s cloud business. Meta and Microsoft will post results after the closing bell US time. Key US GDP data for Q3 was also released overnight indicating the U.S. economy grew at a slower pace than expected for the quarter. In Q3 the U.S. economy grew 2.8% on an annual basis while economists were expecting growth of 3.1%. Key payrolls data also out on Wednesday in the U.S. Though pointed to strength in the labour market with private job creations jumping to the highest level in a year.
Over in Europe on Wednesday, markets in the region closed lower following the release of key corporate earnings results and eurozone flash GDP data indicating that the eurozone economy grew 0.4% in Q3 which topped economists’ expectations of 0.2% expansion. The STOXX 600 fell 1.2%, Germany’s DAX fell 1.13%, the French CAC dropped 1.1%, and, in the UK, the FTSE100 ended the day down 0.73%.Across the Asia region on Wednesday, markets mostly fell led by Hong Kong’s Hang Seng sliding 1.65%, while China’s CSI index lost 0.9%, and Japan’s Nikkei ended the day down 0.96%.
Locally on Wednesday the ASX fell 0.83% despite inflation tumbling to an annual headline rate of 2.8% for the three months to September, down from the 3.8% reported in the June quarter. While this reding is positive for the rate outlook, the RBA is still unlikely to reduce the nation’s cash rate until at least 2025 as the drop in inflation is expected to be short lived with key drivers remaining sticky. Core inflation, which is the RBA’s preferred inflation reading, rose 0.8% in the September quarter which topped forecasts of 0.7%.
A key driver of the drop in inflation over the period was a decline in the petrol prices due to the 18% fall in the benchmark price of oil over the past year amid weakened demand outlook from China.
Rental prices have failed to ease up though which is another key driver of inflation remaining sticky, with a rise of 6.7% in the 12-months to September.
A tough warning from our supermarket giants saw shares in Coles and Woolworths decline 2.4% and 6.1% respectively yesterday. Woolworths warned it would post a lower profit in the first half after it was forced to implement more promotions to entice shoppers back into stores, which has been a theme felt across most retailers in FY25 so far.
What to watch today:
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX to open the day down 0.17% tracking Wall Street’s sell-off overnight.
- On the commodities front this morning oil is trading 2.77% higher at US$69.07/barrel, gold is up 0.44% at US$2787/ounce, and iron ore is down just 0.06% at US$104.09/tonne.
- The Aussie dollar is buying US$0.65, 100.79 Japanese Yen, 50.69 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has maintained a buy rating on Gold Road Resources (ASX:GOR) and have raised the 12-month price target on the gold producer from $2.10 to $2.40 following the release of the company’s Q3 FY24 results which were weaker than expected but positions the company well for Q4 especially given the return to peak high-grade ore throughput in the strong gold price environment.
- And Trading Central has identified a bearish signal on Commonwealth Bank of Australia (ASX:CBA) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may fall from the close of $142.93 to the range of $129 - $132 according to standard principles of technical analysis.
Wall Street closed mixed on Tuesday with the Nasdaq extending its record run to end the day at a fresh record high as investors prepare for the release of key corporate earnings results out of some big tech names. The Nasdaq rose 0.78% to close at a record 18,712.75 points, while the S&P500 rose 0.16%, but the Dow Jones ended the day down 0.36%.
Earnings season has driven investor sentiment these last few weeks and we are awaiting key earnings out of the magnificent seven to provide key outlook on the broader market conditions based on earnings growth and forecasts out of the most valuable companies listed on the NYSE. Alphabet, Snap, Reddit and Chipotle are set to release results after the closing bell on Tuesday while Meta and Microsoft will release results on Wednesday US time.
Across the European markets overnight, markets closed lower as investors digested key corporate earnings results. The STOXX 600 fell 0.6%, Germany’s DAX lost 0.27%, the French CAC dropped 0.61% and, in the UK, the FTSE 100 ended the day down 0.8%. German airline Lufthansa fell 4.7% on Tuesday after reporting a 9% YoY fall in Q3 profit, while HSBC rose 3.3% after the bank released Q3 earnings that beat analysts’ estimates and announced it will repurchase up to $3bn in shares.
Asia markets closed mostly higher on Tuesday tracking gains on Wall St overnight with Japan’s Nikkei rising 0.77% on the back of the Japanese jobless rate falling to 2.4%. Hong Kong’s Hang Seng rose 0.35% on Tuesday and South Korea’s Kospi index ended the day up 0.21%.
The ASX started the week slightly higher on Monday and extended gains into Tuesday’s session with a rise of 0.34% at the closing bell as consumer discretionary and mining stocks boosted the local index to a second positive finish for the week. Tech stocks also did much of the heavy lifting for the local market yesterday on the back of Wall Street’s tech rally overnight.
On the retail front, Myer shares came under pressure on Tuesday after the department store giant agreed to acquire Premier Investments’ apparel brands including Just Jeans, Dotti and Jay Jays in a deal worth $950m. Premier Investments shares soared 11% on the news.
Luxury online fashion retail platform Cettire on the other hand tanked over 14% yesterday after providing the market with a first quarter trading update outlining a 17% margin for the quarter which is down from the 20% recorded in the PCP, and the company’s adjusted EBITDA fell 77% to $2m.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are expecting the ASX to open the day down 0.08%.
- On the commodities front this morning, oil has steadied following a 6% plunge earlier in the week amid over-supply fears as demand remains resilient and geopolitical tensions and actions were not as impactful as first thought. This morning oil is trading 0.19% lower at US$67.26/barrel, gold is up 0.91% at US$2769.26/ounce and iron ore is down just 0.08% at US$104.15/tonne.
- The Aussie dollar has further weakened overnight to buy US$0.65, 100.54 Japanese Yen, 50.75 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded Cettire (ASX:CTT) from a buy to a hold and have maintained the 12-month price target on the luxury online fashion retailer at $2/share following the release of the company’s 1Q25 update including net revenue rising 22% on the PCP which beat BPe, but lower margins and slowing sales growth leading to a decrease in the rating as headwinds and upcoming promotional periods weigh on earnings growth potential.
- And Trading Central has identified a bearish signal on Seven Group (ASX:SVW) following the formation of a pattern over a period of 33-days which is roughly the same amount of time the share price may fall from the close of $41.35 to the range of $39.10 to $39.50 according to standard principles of technical analysis.
Wall St closed higher overnight as softening oil prices lift stocks. The Dow Jones rose by 0.65%, the S&P500 gained 0.27% and the tech heavy Nasdaq ended Monday’s trading session 0.26% higher.
Over in Europe, markets closed higher with the STOXX600 ending Monday’s trading session 0.47% in the green. Gains were led by construction and media stocks which added 2% and 1.6% respectively, while oil and gas stocks fell 1.4%. Germany’s DAX rose 0.35%, the French CAC gained 0.79% and over in the UK the FTSE100 ended the trading session 0.45% higher.
Locally yesterday, the ASX200 closed 0.12% higher with the majority of sectors closing in the green. Gains were led by the information technology and consumer discretionary sectors which rose 1.97% and 0.97% respectively. This was offset by the utilities sector which fell 0.59% by market close.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.42% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 5.27% lower at 67 US dollars and 98 cents a barrel after Israel’s strikes on Iran over the weekend missed the country’s crude facilities and nuclear infrastructure.
- Gold is trading 0.17% lower at 2742 US dollars an ounce and iron ore is trading 0.16% lower at 104 US dollars and 23 cents a tonne.
Trading Ideas:
- Bell Potter has upgraded its hold rating to a buy rating for Droneshield (ASX:DRO) and has a 12-month price target of $1.20. Bell Potter has changed its recommendation to a buy despite DRO’s revenue year to date being disappointing. Droneshield remains a high quality technology company, operating in a rapidly growing market and is well capitalised to maintain its market leading position, hence the buy rating is maintained.
- Trading Central has identified a bearish signal on National Australian Bank (ASX:NAB), indicating that the stock price may fall from the close of $38.67 to the range of $35.10-$35.80, on a pattern formed over 24 days according to the standard principles of technical analysis.
The Nasdaq rose to a fresh record high on Friday while the other major averages ended the day lower as investors piled into the high growth sector ahead of key earnings results being released. The Nasdaq rose 0.56% to a fresh record 18,518.61 points, the S&P 500 inched 0.03% lower and the Dow Jones ended the day down 0.61%.Fast food giant McDonalds shares posted the biggest weekly loss since 2020 on Friday as a deadly E. Coli outbreak linked to the burger giant weighed on the fast-food chain’s stock price. Shares fell 7.6% over the trading week. Spirit Airlines soared over 18% on Friday after the budget airline announced it will sell 23 planes for $519m and cut jobs. This rally follows Spirit rocketing 46% on Wednesday on reports the carrier has reignited merger talks with fellow budget airline, Frontier Airlines.
Over in Europe on Friday, markets closed mostly lower as investors responded to key Q3 earnings updates. The STOXX 600 fell 0.04% on Friday but 1% over the trading week, while Germany’s DAX gained 0.11%, the French CAC lost 0.08% and, in the UK, the FTSE100 ended the day down 0.25%. Mercedes shares fell 1% on Friday after the luxury German automaker reported a 64% dive in operating profit, while French spirits maker Remy Cointreau fell 0.7% after slashing its sales outlook for the full year amid demand weakness in the US and APAC regions.
Across the Asia region on Friday, it was a mixed end to the final trading session of last week as investor awaited Japan’s general election over the weekend and responded to Japan’s October inflation numbers with core inflation falling to 1.8% for the month which was in-line with economists’ expectations. Japan’s Nikkei fell 0.6% on Friday, China’s CSI index rose 0.7%, Hong Kong’s Hang Seng rose 0.52% and South Korea’s Kospi index ended the day flat.
Locally on Friday the ASX200 rose just 0.06% to close higher as a 3.34% rally for the tech sector offset weakness among consumer staples, discretionary, and industrials stocks. A rebound in logistics software giant WiseTech Global did a lot of the market’s heavy lifting on Friday with a 12.7% gain after days of being sold off amid negative news surrounding those at the helm of the company.
ResMed rnoallied 5.9% on Friday after the sleep apnoea medical device producer reported revenue rose 3% to US$1.225bn and the company reiterated FY25 guidance of 59-60% despite higher freight costs expected as a result of the Middle East tensions.
What to watch today:
- Ahead of Monday’s trading session here in Australia, the SPI futures are anticipating the ASX to open the day flat.
- On the commodities front this morning oil has risen 2.27% to US$71.78/barrel, gold is up 0.5% at US$2747.60/ounce and iron ore is down 0.16% at US$104.23/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy US$0.66, 101.29 Japanese Yen, 51.10 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded Fortescue (ASX:FMG) to a sell from a hold and have reduced the 12-month price target on the mining giant from $17.58 to $17.04 following the release of the company’s September quarterly update including iron ore shipments falling short of Bell Potter’s expectations while cash costs per wet metric tonne were higher than Bell Potter had anticipated. Production was also down 12% QoQ and are tracking to the bottom of the FY25 guidance range.
- And Trading Central has identified a bullish signal on Grange Resources (ASX:GRR) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may rise from the close of $0.28 to the range of $0.34 to $0.36 according to standard principles of technical analysis.
This week, we delve into Bell Potter's forecast for interest rate reductions, along with their top domestic consumer stock selections, given the recent decline in inflation and rental growth.
In this week’s wrap, Sophia covers:
- (0:28): what the latest CPI reading means for markets
- (0:59): factors contributing to rental inflation
- (1:54): Bell Potter’s consumer stock picks
- (3:05): how the ASX200 performed this week so far
- (4:04): the most traded stocks by Bell Direct clients
- (4:38): economic news items to watch out for.
Wall St closed lower overnight as higher treasury yields weighed on market sentiment. The Dow Jones had its worst day since September falling nearly 1%, the S&P 500 dropped 0.92% and the tech-heavy Nasdaq lost 1.6%.
Over in Europe, markets followed the US and ended Wednesday’s trading session in the red. The STOXX600 closed 0.3% lower with the majority of sectors ending in negative territory. Germany’s DAX fell 0.23%, the French CAC lost half a percent and over in the UK, the FTSE100 closed 0.58% lower.
Locally yesterday, the ASX200 ended Wednesdays session 0.13% higher, with most major sectors ending in the green. Gains were led by the consumer staples and consumer discretionary sectors which rose 1.33% and 0.44% respectively. This was offset by the information technology sector which fell nearly 1%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.19% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 0.96% lower at 71 US dollars a barrel, gold is trading 1.14% lower at 2715 US dollars an ounce and iron ore is trading 0.28% lower at 104 US dollars and 94 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Boss Energy (ASX:BOE) and has a current share price of $3.60. The 12-month price target of $5.70 indicates a 58% share price growth in a year, hence the buy rating is maintained.
Over in the US on Tuesday, rising bond yields are pressured equities for a second session this week. The US 10-Year Treasury note yield briefly topped 4.2% for the first time in months before pulling back. The Dow Jones fell 0.02%, the S&P 500 lost 0.05% lower but the tech heavy Nasdaq ended the day up 0.18%.
In Europe overnight, markets closed lower as investors assessed key corporate earnings results. The STOXX 600 fell 0.2%, Germany’s DAX also lost 0.2%, the French CAC fell 0.01% and, in the UK, the FTSE100 ended the day down 0.14%.
Across the Asia region on Tuesday, markets closed mostly lower in the region tracking global market sell-offs early in the week. China’s CSI index bucked the sea of red to rise 0.57% on Tuesday while South Korea’s Kospi Index fell 1.31%, and Japan’s Nikkei lost 1.39%. Hyundai Motor shares debuted on India’s stock exchange on Tuesday with a record IPO but shares ended the day down 7%.
The local market started the week higher before closing 1.66% lower on Tuesday in line with the Wall Street’s pullback on Monday. With markets now factoring the need for a less aggressive rate cut strategy out of the US as inflation eases and the economy remains resilient, investors are now questioning how much steam the local and global market rally has left.
Mineral Resources and WiseTech Global have been under pressure this week amid news and respective investigations into those at the helm of the mining and logistics technology company alike.
Audinate Group fell over 6% on Tuesday after the media software provider released a quarterly update outlining weak performance in a challenging operating environment was the key reason for full-year gross profit missing the target.
Toll roads operator Transurban also fell almost 2% yesterday despite reaffirming FY25 distribution guidance of 65cps and reported growth in traffic across its key markets aside from Melbourne.
One element of positivity in the Aussie market yesterday was Australian consumer confidence jumping to its highest level since January last year last week with a rise to 87.5 points, or a 4.1 point rise as the outlook for inflation eases and consumer sentiment was boosted by strong Australian jobs data also released last week.
Wine exports from Australia also climbed 34% to $2.39bn in the 12-months to the end of September which is a welcomed boost for listed companies like Treasury Wine Estates which has faced tougher operating conditions prior to China lifting its tariffs on Aussie wine exports recently.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are expecting the ASX to open the day up 0.28% despite the pullback on Wall St on Tuesday.
- On the commodities front this morning oil is trading 2.26% higher at US$71.63/barrel, gold is up 0.92% at US$2746/ounce, and iron ore is down 0.13% at US$105.23/tonne.
- The Aussie dollar has weakened against the greenback overnight to buy US$0.66, 101.03 Japanese Yen, 51.39 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Select Harvests (ASX:SHV) from $4.95 to $4.60 and maintain a buy rating on the almond producer following a disappointing FY24 update including a capital raising and the guidance for FY24 underlying EBIT of $17-19m which is lower than Bell Potter was expecting. Bell Potter maintains the buy rating due to recent strengthening in almond prices driving upside potential.
- And Trading Central has identified a bearish signal on The Star Entertainment Group (ASX:SGR) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may fall from the close of 27cps to the range of 15 cps to 17 cps according to standard principles of technical analysis.
Wall St closed mixed overnight as the Dow snapped a three-day winning streak losing 0.8%. The S&P 500 fell 0.18%, whilst the tech-heavy Nasdaq ended Monday’s trading session 0.27% in the green.
Over in Europe, markets closed lower as investors monitor heightened Middle Eastern tensions. The STOXX600 closed 0.7% lower with nearly all major sectors ending the day negatively. Losses were led by insurance stocks which fell 1.1%, whilst oil & gas stocks rose 0.6%.
Germany’s DAX and the French CAC both lost 1%, whilst over in the UK the FTSE 100 dropped nearly half a percent.
Locally yesterday, the ASX200 ended Monday’s trading session 0.74% higher with all but one major sector ending the day in the green. Gains were led by the materials and energy sectors which closed 1.44% and 1.25% higher respectively. This was offset by the information technology sector which fell 2.97%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.81% at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.67% higher at 70 US dollars and 37 cents a barrel as rising Middle Eastern tensions threaten supply disruptions.
- Gold is trading 0.08% lower at 2719 US dollars an ounce and iron ore is trading flat at 105 US dollars and 37 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Beach Energy (ASX:BPT) and has a current share price of $1.25. The 12-month price target of $1.50 indicates a share price growth of 20%, hence the buy rating is maintained.
- And Trading Central has identified a bearish signal on Ingenia Communities Group (ASX:INA), indicating that the share price may fall from the close of $4.93 to the range of $4.57-$4.63, on a pattern formed over 10 days, according to the standard principles of technical analysis.
6-straight weeks of gains were sealed across the major averages in New York on Friday with both the Dow and S&P500 setting fresh records at the closing bell.
Over the week, the Dow and S&P500 gained 0.96% respectively, while the Nasdaq added 0.8%, with Q3 earnings results being the driver of gains throughout the last trading week.
Netflix shares rose 11% on Friday after the streaming giant beat Wall St estimates for earnings and revenues for Q3 and reported a 35% jump in ad-tier memberships on the prior quarter. Of the more than 70 companies that have reported from the S&P500 so far, 75% have beaten earnings expectations according to FactSet.
The small cap space once again outshone the major players last week with the Russell 2000 index ending the week 2% higher.
Over in Europe on Friday markets closed mostly higher marking a second straight week of gains boosted by a rise in luxury brands. The STOXX600 rose 0.21%, Germany’s DAX added 0.38%, the French CAC gained 0.39% and, in the UK, the FTSE100 ended the day down 0.32%.
Gucci owner Kering rose 3.5% on Friday while Burberry rose 0.5% as investors saw Chinese stimulus as a boost for demand outlook for luxury European brands in China.
Across the Asia markets on Friday, markets rebounded to close higher as stronger-than-expected GDP data in China boosted investor optimism. China’s GDP grew 4.6% in Q3 compared to the same period a year earlier which beat economists’ expectations but was a slight fall from the 4.7% expansion reported in Q2.
Retail sales in China also beat expectations for September with a rise to 3.2% YoY while China’s industrial output also grew faster than expected at 5.4%. China’s CSI index rose 3.62% on Friday, Japan’s Nikkei gained 0.2%, South Korea’s Kospi index fell 0.6%, and Hong Kong’s Hang Seng rose 3.61%.
Locally on Friday, the ASX200 fell 0.87% as a sharp sell off in utilities stocks weighed on the market, while every sector closed the day in the red. The Aussie sell-off was on the back of China’s economic data out on Thursday indicating worsening economic slow down out of the world’s second largest economy, despite stronger data out on Friday.
Flight Centre tanked 20% on Friday after the company released a trading update outlining a profit downgrade was imminent.
What to watch today:
- Ahead of Monday’s Trading Session the SPI futures are anticipating the ASX to open the day up 0.53% on the back of global market strength on Friday.
- On the commodities front this morning, oil is trading 2.05% lower at US$69.22/barrel, gold is up 1.02% at US$2721/ounce, and iron ore is flat at US$105.37/tonne.
- The Aussie dollar has slightly weakened against the greenback to buy US$0.67, 100.34 Japanese Yen, 51.41 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded the rating on Lynas Rare Earths (ASX:LYC) from a buy to a hold rating and have reduced the 12-month price target on the company from $8.30 to $8 heading into the release of the company’s quarterly production update. The analyst has estimated production of NdPr to fall 5% QoQ and revenue of $121m down 12% QoQ after management guided to a slow start to FY25 amid the planned shut down towards the end of CY24 and delay in the Mt Weld expansion.
- And Trading Central has identified a bearish signal on Paragon Care (ASX:PGC) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may fall from the close of 47cps to the range of 38-40cps according to standard principles of technical analysis.
The ASX200 index rose 1.72% this week so far (Mon – Thurs), boosted by a strong 4% gain in the financial sector. Economic data, US earnings, and commodity price volatility influenced market movements.
In this week’s wrap, Grady covers:
- (0:20): the highlights in US earnings results released this week
- (2:03): key economic data out in China
- (3:46): the best performers on the ASX200 this week
- (4:42): the most traded stocks & ETFs by Bell Direct clients
- (5:10): economic news items to watch out for next week.
Wall St closed higher overnight as the Dow Jones rose to a record close following a sell-off in its previous session, rising 0.79%. The S&P 500 rose by 0.47% and the tech-heavy Nasdaq jumped by 0.27%.
In terms of US stocks, Morgan Stanley gained 6.5% following strong third-quarter earnings which toppled Wall Street expectations.
Over in Europe, markets closed lower overnight with chips stocks and luxury goods leading losses following sales warnings. The STOXX600 fell 0.15% with half of the major sectors ending Wednesday’s trading session in negative territory. Germany’s Dax fell 0.27%, the French CAC lost 0.4% and over in the UK, the FTSE100 gained nearly 1% overnight.
Locally yesterday, the ASX200 fell by 0.4% with all but one major sector closing in the red. Losses were led by the information technology and utilities sectors which dropped 1.35% and 1.21% respectively. This was offset by the financial sector which gained 0.27% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.72% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.12% higher at 70 US dollars and 67 cents a barrel following continued uncertainty over the war in the Middle East.
- Gold is trading half a percent higher at 2673 US dollars an ounce and iron ore is trading 0.45% lower at 106 US dollars and 63 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Catalyst Metals (ASX:CYL) and has a 12-month price target of $3.06. The 12-month price target of $4.30, indicates a share price growth of 40.5%, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal in Kina Securities (ASX:KSL), indicating that the stock price may rise from the close of $1.04 to the range of $1.08-$1.10, on a pattern formed over 16 days, according to the standard principles of technical analysis.
Wall Streets’ green run ended on Tuesday with the major averages move away from record territory as investors digest some key Q3 earnings results. The Dow Jones fell 0.75%, the S&P500 lost 0.76%, and the tech-heavy Nasdaq fell 1.01%. UnitedHealth fell 8.1% after the company trimmed full-year earnings outlook, while Bank of America rallied 2% on better-than-expected results.
Citi shares fell over 4% on Tuesday even after the big bank beat Wall St expectations for Q3, and LVMH shares fell nearly 7% to their lowest level since October 2022 after the luxury fashion house posted disappointing results.
Over in Europe overnight, markets closed lower as investors responded to key earnings updates and monitored a sharp fall in oil prices. The STOXX 600 fell 0.7%, Germany’s DAX closed down 0.11%, the French CAC lost 1.05% and, in the UK, the FTSE100 ended the day down 0.52%.
Dutch semiconductor maker ASML tumbled over 15% after the company said in its earnings report that it expects net sale for 2025 to come in between 30 billion euros and 35 billion euros, at the lower half of the range it had previously provided.
Across the Asia region, markets closed mostly lower as China’s weak trade data weighed on investor sentiment in the region. China’s CSI index lost 2.66% on Tuesday after the nation’s September trade data showed exports rose 2.4% YoY and imports added just 0.3%, with both metrics sharply missing expectations. Hong Kong’s Hang Seng lost 3.67% on Tuesday, but Japan’s Nikkei rose 0.77%.
The local market extended this week’s rally into Tuesday’s session with a gain of 0.8% at the closing bell after hitting fresh intraday highs, buoyed by the banks with CBA rising 1.6%, Westpac adding 1.3%, ANZ rising 0.8% and NAB gaining 1.3%.
Tyro Payments tanked over 15% on Tuesday on news that the federal government of Australia is planning to crackdown on credit card surcharges by 2026, with the government even saying it will go as far as banning the practice to give consumers and small businesses a fair go. This move would impact Tyro Payments among other payment service providers that rely on such fees for earnings.
Hub24 rose 4.3% on Tuesday after posting record quarterly net inflows of $4bn announced in the company’s latest trading update while total funds under administration hit $113bn in the quarter.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day down 0.38% on the back of Wall Street’s turbulence overnight.
- On the commodities front this morning, oil has tumbled 4.68% to trade at US$70.40/barrel, gold is up 0.55% at US$2663.90/ounce and iron ore is up 0.63% at US$107.11/tonne.
- The Aussie dollar has weakened overnight to buy US$0.67, 100.15 Japanese Yen, 51.27 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded the rating on The a2 Milk Company (ASX:A2M) from a hold to a sell and have slightly reduced the 12-month price target on the company from $6.20 to $6.10 in-light of a recent share price gain on expectations of a rebound in demand in China. The analyst sees A2M trading at 17.5x FY25 expected EBITDA as not supported by any fundamental changes and sees better value elsewhere, especially given the rally puts A2M trading at a 51% premium to Dairy FMCG plays.
- And Trading Central has identified a bullish signal on Accent Group (ASX:AX1) following the formation of a pattern over a period of 38-days which is roughly the same amount of time the share price may rise from the close of $2.44 to the range of $2.82 to $2.90 according to standard principles of technical analysis.
Wall Street has extended on its record finish to trade higher yet again overnight. The Dow Jones jumped 0.47%, the S&P 500 gained 0.77% and the tech-heavy Nasdaq rose by 0.87%.
So far, this third quarter earnings season, the 30 companies on the S&P500 that have reported have beat earnings expectations by about 5% on average which is better than the 3% beat this time last quarter.
Over in Europe, markets closed higher following market rallies in Wall St overnight. The STOXX600 gained half a percent by the end of the trading day with tech stocks jumping 1.7%, whilst travel and leisure stocks fell 0.8%. Germany’s DAX rose 0.69%, the French CAC gained 0.32% and over in the UK the FTSE100 ended Monday’s trading session 0.47% in the green.
Locally yesterday, the ASX200 rose 0.47% despite the majority of sectors finishing in negative territory. Gains were led by the material and health sectors which rose by 1.3% and 0.89% respectively. This was offset by the energy sector which fell by 1.26%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.45% at market open this morning.
-
On the commodities front this morning,
- At the time of recording, oil is trading 4.5% lower to 72 US dollars and 17 cents a barrel following concerns over China’s weakening economy after China’s Finance Ministry briefing on Saturday, which lacked new major financial stimulus.
- Gold is trading 0.39% lower at 2646 US dollars an ounce and iron ore is trading 0.6% higher at 106 US dollars and 44 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Bega Cheese (ASX:BGA) and has a current share price of $5.25. The 12-month price target of $6.45 represents a share price growth of 22.9% over the next 12-months, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Perentin Ltd (ASX:PRN), indicating that the stock price may rise from the close of $1.05 to the range of $1.18-$1.22, on a pattern formed over 71 days, according to the standard principles of technical analysis.
Wall Street closed in record territory on Friday as the big banks had a very strong start to the third-quarter earnings season. The Dow Jones added 0.97% to a fresh record 42,863.86 on Friday while the S&P500 gained 0.65% to a fresh record 5815.03 and the tech-heavy Nasdaq rose 0.33%, just 2% below its record high.
JP Morgan Chase rose 4.4% after topping profit and revenue expectations for Q3 while Wells Fargo rose 5.6% on stronger-than-expected profits.
Over in Europe markets closed higher on Friday as investors assessed key UK growth figures and looked ahead to further key economic data out in the region soon. The STOXX 600 rose 0.53%, Germany’s DAX added 0.85%, the French CAC rose 0.48%, and, in the UK, the FTSE100 ended the day up 0.19%. The UK economy returned to GDP expansion in August with Britain’s GDP rising 0.2% in the month following flat readings in June and July.
Across the Asia region on Friday it was a mixed close as China’s stimulus-fuelled rally lost steam. China’s CSI index lost 2.77%, South Korea’s Kospi Index fell slightly despite the Bank of Korea cutting the benchmark interest rate by 25-basis points in the first rate cut since 2020. Japan’s Nikkei gained 0.57% on Friday and Hong Kong’s Hang Seng was close for a public holiday.
The ASX closed 0.1% lower on Friday as a broad sell off across 6 of the 11 sectors weighed on the key index.
Energy stocks rose on Friday on the oil price rebound – which has been the story of the last month with high volatility based on geopolitical tensions escalating and easing.
Capital raisings have been on the rise recently as the impacts of high interest rates and subdued demand finally hit company balance sheets. On Friday we saw Appen return to profitability but also announce a capital raise to expand into AI, while Dubber also announced a $25m capital raise to ‘accelerate sales momentum and execute a new sales strategy’.
Gold miners rallied on Friday due to the rising price of the precious commodity as demand for the safe-haven asset continues to rise.
What to watch today:
- Ahead of the first trading session this week the SPI futures are anticipating the ASX to open the new trading day up 0.56% on the back of Wall Street’s rally on Friday.
- On the commodities front this morning oil is trading 0.38% lower at US$75.56/barrel, gold is up 0.91% at US$2657/ounce, and iron ore is up 0.6% at US$106.44/tonne.
- AU$1.00 is buying US$0.67, 100.54 Japanese Yen, 51.63 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the rating on Catapult Group (ASX:CAT) from a hold to a buy and have raised the 12-month price target on the sports tracking software company from $2.35 to $2.75 ahead of the company’s first half results due out in a month’s time. The key focus for Bell Potter’s analyst in the upcoming results is the performance of the Tactics and Coaching division i.e. the video business from both a revenue and total contract value perspective.
- And Trading Central has identified a bullish signal on SG Fleet Group (ASX:SGF) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $2.68 to the range of $2.81 to $2.85 according to standard principles of technical analysis.
Rio Tinto's acquisition of Arcadium Lithium has sent shockwaves through the lithium market. With its global reach and potential for supply deals with major carmakers, Rio's move suggests a renewed optimism about the future of lithium and the green energy transition.
In this week’s wrap, Grady covers:
- (0:14): how Rio’s deal sparked interest in lithium mining
- (1:37): why Rio is optimistic about the long-term fundamentals for lithium demand
- (3:03): the potential for increased interest in lithium mining
- (3:54): how the ASX200 performed this week so far
- (4:39): the most traded stocks & ETFs by Bell Direct clients
- (5:10): economic data to watch out for next week.
Wall Street rose for a second straight session on Wednesday to record territory as investors shook off geopolitical concerns and bought back into tech stocks. The Dow Jones rose 1.03% to a record close, as did the S&P500 ending the day up 0.71% also to a record close, and the tech-heavy Nasdaq added 0.6% at the closing bell.
The driver of the rally in the US was the release of the Fed’s latest meeting minutes whereby majority of participants favoured reducing interest rates by more than 50 basis points.
Over in Europe overnight, markets closed higher ahead of key rate decisions out later this week and on easing oil prices. The STOXX 600 rose 0.66%, Germany’s DAX added 0.99%, the French CAC rose 0.52% and, in the UK, the FTSE100 ended the day up 0.65%.Across the Asia region on Wednesday it was a mixed session with China’s CSI index snapping a 10-day winning streak with a tumble of 7.05%, while Hong Kong’s Hang Seng fell 1.7%, but Japan’s Nikkei rose 0.87% and South Korea’s Kospi Index was closed for a holiday.
The Australian market closed 0.13% higher on Wednesday as a strong tech rally offset sharp declines among materials and energy stocks.
What to watch today:
- The local tech rally was on the back of Wall Street rising overnight back to near record territory. The materials sell off sparking investors to hit the sell-button on the big iron ore miners followed Beijing dampening hopes of more fiscal spending to aid China’s post-pandemic recovery efforts.
- BHP (ASX:BHP) and Rio Tinto (ASX:RIO) fell 1.2% and 2.3% respectively on Wednesday.
- On the Rio Tinto story, the mining giant has become the first mining giant to snap up a large lithium company when it agreed to acquire Arcadium Lithium for US$6.7bn in an all-cash deal announced on Wednesday. While BHP is going hard at expanding into the copper space, Rio Tinto becomes the first major mining player to back the lithium space following years of depressed pricing for the once-loved green commodity.
- Over in New Zealand the RBNZ cut the cash rate by 50bps to 4.75% as inflation returned to the target 1-3%.
- Ahead of Thursday’s trading session on the ASX the SPI futures are anticipating the ASX to open the day up 0.4% tracking Wall Street’s rally overnight.
- On the commodities front this morning, oil is down 0.3% at US$73.36/barrel, gold is down 0.54% at US$2607/ounce and iron ore is down 5.42% at US$106.30/tonne.
- The Aussie Dollar is buying 67.31 US cents, 100.26 Japanese Yen, 51.36 British Pence, and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Bell Potter has downgraded the rating on GrainCorp (ASX:GNC) from a buy to a hold and have reduced the 12-month price target on the grain logistics and storage company on the back of analysing key drivers for FY25 including a frost event impacting East coast production and the narrowing of domestic oilseed pricing premiums.
- Trading Central has identified a bullish signal on KMD Brands (ASX:KMD) following the formation of a pattern over a period of 27-days which is roughly the same amount of time the share price may rise from the close of 47cps to the range of 56 to 58cps according to standard principles of technical analysis.
Wall Street closed higher overnight as lowering oil prices takes the pressure off stocks. The Dow Jones rose by 0.3%, the S&P 500 gained 0.97% and the tech-heavy Nasdaq ended 1.45% higher by the closing bell.
Over in Europe, markets closed lower following eased stimulus talks coming out of China. The STOXX600 fell by 0.54% with all major sectors closing in the red, including mining stocks which dropped 4.47% and household goods which lost 1.47%. Germany’s DAX lowered by 0.2%, the French CAC fell 0.72% and over in the UK the FTSE100 ended Tuesday’s trading session 1.36% lower.
Locally on Tuesday the ASX200 fell 0.35% with BHP and Rio Tinto losing more than 2% each after China’s National Development and Reform Commission press conference was held without further material stimulus measures included.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.18% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 4.37% lower at 73 US dollars and 76 cents a barrel as supply issues in the Middle East are yet to be impacted and investors have started to focus back towards Chinese demand
- Gold is trading 0.84% lower at 2620 US dollars an ounce and iron ore is trading 3.26% higher at 112 US dollars and 39 cents a tonne.
Trading Ideas:
- Bell potter maintains a buy rating on Seven Group Holdings (ASX:SVW) and has a 12-month price target of $48.50. The buy rating is maintained by Bell Potter as SVW’s businesses and investments are market leaders in their respective industries, with scale, brand, and industry expertise underpinning commercial advantages that are hard to replicate by competitors. Bell Potter remains positive on the near-term outlook for mining production, engineering construction and transitional energy markets, hence the buy rating is maintained.
- And Trading Central has identified a bearish signal in IDP Education (ASX:IEL), indicating that the stock price may rise from the close of $15.04 to the range of $13.50-$13.80, on a pattern formed over 29 days, according to the standard principles of technical analysis.
Wall Street fell on Monday amid rising oil prices and escalating tensions in the Middle East. The Dow Jones fell 0.94%, the S&P500 fell 0.96% and the Nasdaq ended the day down 1.18%. The benchmark 10-year treasury yield rose 3 basis points to 4.01%, marking the first time that the yield has topped 4% since August.
US stocks failed to extend their rally from Friday following the release of a stronger-than-expected jobs report out in the region boosting confidence of a soft landing through economic stability while inflation eases and the Fed continues its rate cut plans.
Across European markets overnight, markets closed mostly higher in the region ahead of key economic data out throughout this week. The STOXX 600 rose 0.17%, Germany’s DAX fell 0.09%, the French CAC added almost half a percent and, in the UK, the FTSE100 ended the day up 0.28%.
Across the Asia region on Monday, markets closed higher ahead of three key rate decisions out of central banks in the region this week. Japan’s Nikkei led the gains with a near 2% rise while Hong Kong’s Hang Seng rose 1.6%, South Korea’s Kospi Index rose 1.58% and China’s CSI index remained closed for the Golden Week holiday.
The local market started the new trading week with a light trading session amid the Labour Day holiday in NSW, but shares still managed to end the day 0.7% higher, just 7 points shy of the latest record close set in September.
Investors fought to buy Arcadium Lithium shares yesterday sending the lithium miner’s share price soaring 46% after Rio Tinto confirmed it was in takeover talks with Arcadium. Rio Tinto shares fell 2.5% on Monday.
The Arcadium rally boosted fellow lithium miners like Liontown Resources which rose 18%, Sayona Mining which climbed 13% and Core Lithium which added 8.7% as investors see the big mining giant’s interest in lithium as a recovery outlook for the leading green commodity.
The recent rebound in the price of iron ore spilled into this week which boosted the big iron ore giants again on Monday with BHP and Fortescue adding 0.6% and 3% respectively at the end of Monday’s session. Speculations are circulating that further economic stimulus will be revealed out of China this week as the region puts in place material efforts and stimulus to reignite economic growth and expansion.
What to watch today:
- Ahead of Tuesday’s trading session locally, the SPI futures are anticipating the ASX to open the day down 0.05% tracking Wall Street’s losses overnight.
- On the commodities front this morning, oil has jumped 3.42% overnight to trade at US$76.92/barrel on escalating tensions and supply concerns out of the Middle East, gold is down 0.2% at US$2648/ounce, and iron ore is up 0.5% at US$108.84/tonne.
- The Aussie dollar has weakened against the greenback overnight to buy US$0.67 cents, 100.10 Japanese Yen, 51.86 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Light & Wonder (ASX:LNW) and maintain a buy rating on the leading global cross-platform games company after the analyst assessed the situation around the Dragon Train (DT) preliminary injunction whereby the US District Court for Nevada granted Aristocrat Leisure a preliminary injunction to Light & Wonder’s successful Dragon Train game preventing further installs of DT and sales globally. The upgrade in the price target by Bell Potter’s analyst is due to the company’s overall leading scale and cross-platform strategy producing a portfolio of high-performing games in both land and digital markets.
- And Trading Central has identified a bullish signal on Pepper Money (ASX:PPM) following the formation of a pattern over a period of 31-days which is roughly the same amount of time the share price may rise from the close of $1.40 to the range of $1.49 - $1.51 according to standard principles of technical analysis.
Markets this week saw volatility in commodity prices, particularly in oil, gold, and iron ore. The rising geopolitical tensions in the Middle East, combined with China’s economic stimulus measures, are driving up the prices of these commodities. While this presents opportunities for investors, it also poses risks due to the potential for price fluctuations.
In this week’s wrap, Grady covers:
- (1:29): how investors should approach investing in oil producers
- (2:04): why the gold rally continues to outshine the market
- (2:38): how China’s stimulus announcement moved the price of iron ore
- (4:13): the best performers on the ASX200
- (5:11): the most traded stocks & ETFs by Bell Direct clients this week
- (5:42): five economic news items to watch out for.
Wall St closed lower overnight as the slow start to October continues as Middle Eastern tensions continue and investors await for unemployment data later on tonight. The Dow Jones fell 0.44%, the S&P500 dropped 0.17% and the tech heavy Nasdaq lost 0.04%.
Over in Europe, markets closed lower with the STOXX600 closing 1% lower. All major sectors closed in the red with construction and materials stocks leading losses down 2%. Germany’s DAX fell 0.78%, the French CAC dropped 1.32% and over in the UK the FTSE100 lost 0.1%.
Locally yesterday, the ASX200 rose by 0.09% with half of the major sectors ending in the green. Gains were led by the real estate sector which gained 1.65% with this being offset by the utilities sector which dropped by 0.41% by the closing bell.
What to watch today:
- The Australian share market is set to open lower with the SPI futures suggesting a fall of 0.33% at market open this morning.
- On the commodities front this morning,
- Oil is trading 5.54% higher at 73 US dollars and 98 cents a barrel following rising geopolitical tensions in the Middle East
- Gold is trading 0.18% lower at 2655 US dollars an ounce and iron ore is trading 0.51% higher at 109 US dollars and 29 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Cedar Woods Properties (ASX:CWP) and has a current share price of $5.60. The 12-month price target of $7.15, indicates a 27.7% growth target in a year, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on TPG Telecom (ASX:TPG), indicating that the stock price may rise from the close of $5.04 to the range of $5.31-$5.39, on a pattern formed over 17 days, according to the standard principles of technical analysis.
Wall St closed slightly higher overnight as the escalating tensions in the Middle East impacted markets. The Dow Jones added 0.09%, the S&P 500 rose just 0.01% and the tech-heavy Nasdaq gained 0.08%.
Iran’s attack on Israel has impacted investor enthusiasm on Wall St for the new trading month and quarter, with trader uncertainty set to continue following Israel starting ground operations in Lebanon.
Over in Europe, markets closed mixed, following in a similar trend to the US. The STOXX600 remained flat overnight with losses led by the utilities sector falling 1.8%, while oil and gas stocks jumped 1.5% following supply concerns in the Middle East. Germany’s DAX fell 0.25%, the French CAC gained 0.05% and over in the UK the FTSE 100 rose 0.17%.
Locally yesterday, the ASX200 closed 0.13% lower with the majority of sectors closing in the red. Losses were led by the consumer discretionary and information technology sector which fell by 1.73% and 1.58% respectively. This was offset by the energy sector which rose by 2.35% yesterday.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.04% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.71% higher at 71 US dollars and 2 cents a barrel following supply disruptions in the Middle East.
- Gold is trading 0.07% lower at 2658 US dollars an ounce and iron ore is trading a massive 15.89% higher at 108 US dollars and 74 cents a tonne as China relaxed rules for homebuyers and moved to lower mortgage rates to support the property market, showing there is a potential rebound in demand for construction materials.
Trading Ideas:
- Bell Potter has initiated coverage on Codan Limited (ASX: CDA) with a hold rating and has a 12-month price target of $16.90. Codan is an Australian technology company that develops and manufactures innovative, mission critical communications and detection technology. CDA’s primary customers include defence, government departments, major corporates, small scale miners and individual consumers. With a current price target of $16.33 the hold rating is recommended.
- And Trading Central has identified a bearish signal in EVT Limited (ASX:EVT), indicating that the stock price may fall from the close of $10.53 to the range of $8.80-$9.20, on a pattern formed over 15 days, according to the standard principles of technical analysis.
In the US on Tuesday, Wall Street retreated from record territory as investors assess the potential impacts of escalating tensions in the Middle East. The Dow Jones fell 0.41%, the S&P500 lost 0.93% and the tech-heavy Nasdaq ended the day down 1.53%.
Energy stocks rallied on Wall St though on Tuesday as the price of West Texas Intermediate crude spiked after Israel Defence forces said Iran was firing missiles at the country.
The European markets ended Tuesday’s trading session mostly lower on escalating tensions in the Middle East, despite the release of favourable fresh Eurozone inflation data coming in at a decline of 0.1% for September which was lower than August’s reading of a 0.1% increase. On a yearly basis, the Eurozone inflation rate eased to 1.8% from 2.2% in August, in-line with market forecasts. The STOXX 600 fell 0.4%, Germany’s DAX lost 0.58%, the French CAC fell 0.81%, and in the UK, the FTSE100 ended the day up 0.48%.
Across the Asia region on Tuesday, markets closed mostly higher led by Hong Kong’s Hang Seng rising 2.43%, while Japan’s Nikkei added 1.93%, but South Korea’s Kospi Index fell 2.13% on Tuesday.
The local market started the trading month of October mixed with a record close on Monday before sliding 0.74% on Tuesday as Australian retail sales data came in hotter than economists’ were expecting, providing further evidence that inflation remains sticky, and the RBA shouldn’t consider cutting rates just yet. Materials stocks slid 2.3% while healthcare stocks rallied 1.12%. Retail sales rose 0.7% MoM in August which exceeded market forecasts of a 0.4% rise and was a rise for a 5th straight month.
Sigma Healthcare soared 23% on Tuesday after the pharmacy operator offered to make court-enforceable undertakings to satisfy the ACCC concerns over the company’s proposed merger with Chemist Warehouse.
Qantas shares fell 3.4% yesterday on news that Qatar Airways has moved to purchase of a 25% stake in Qantas rival, Virgin.
And REA Group rallied 5% yesterday after the leading real estate business confirmed it would abandon its takeover bid for Rightmove after the UK-based company rejected REA’s fourth bid in a number of weeks.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day up just 0.02%.
- On the commodities front this morning, oil is trading almost 3% higher at US$70.18/barrel on supply fears out of the Middle East as tensions in the region escalate, while gold is up 1.04% at US$2662/ounce and iron ore is up 0.91% at US$93.83/tonne.
- The Aussie dollar is buying US$0.69, 99.07 Japanese Yen, 51.84 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has maintained a hold rating on WiseTech Global (ASX:WTC) and raised the 12-month price target on the leading logistics software company from $115/share to $132.50/share post the release of the company’s FY24 result in August and news last month of DSV’s acquisition of Schenker (where DSV is a global rollout customer of WiseTech Global but Schenker is not. Bell Potter believes the stock looks expensive on an FY25 PE ratio and EV/EBITDA of 120x and 67x respectively hence the hold rating is maintained and the price target is raised based on the strong growth outlook.
- And Trading Central has identified a bullish signal on Autosports Group (ASX:ASG) following the formation of a pattern over a period of 69-days which is roughly the same amount of time the share price may rise from the close of $2.22 to the range of $2.28 to $2.32 per share according to standard principles of technical analysis.
Wall St opened the week with gains to close out a winning month across the major averages with the Dow adding 1.8% in September while the S&P 500 gained 2% and the Nasdaq added 2.7% over the September month of trading. The Dow Jones rose 0.04% to a fresh record high, while the S&P500 added 0.4% and the Nasdaq ended the day up 0.4%. The rally on Monday followed Fed Chair Jerome Powell’s press conference indicating the rate cuts will continue but likely not as aggressively as the US economy shows signs of resilience against easing inflation. Stellantis shares dropped 12.52% on Monday in the U.S. after the Jeep and RAM manufacturer lowered earnings guidance amid a worsening U.S. economy outlook. GM and Ford shares also fell on Monday.
In Europe overnight it was a sea of red across the region for the last trading day of September in a pullback from the records set in the region on Friday. The STOXX 600 lost 0.95%, Germany’s DAX fell 0.76%, the French CAC lost 2% and, in the UK, the FTSE100 ended the day down 1.01%.
Across the Asia region on Monday China’s record rally continued with stocks rallying to their best day in 16-years following stimulus measure announcements out of Beijing last week.
The Aussie market scaled 0.7% higher to a fresh record close on Monday as 9 of the 11 sectors ended the day higher led by energy stocks rallying on the rising price of oil amid fresh attacks from Israel on Lebanon.
Iron ore miners also felt some relief on Monday on the rising price of iron ore following a material stimulus package announced out of China last week to help reignite economic growth post pandemic. China’s manufacturing activity contracted sharply in September though amid subdued demand in the region while production expanded for an 11th straight month in September in China, but new orders fell.
Liontown Resources rallied on Monday after the lithium miner completed its first shipment of lithium spodumene concentrate to China and spot sales starting from its flagship mine in WA.
What to watch today:
- Ahead of Tuesday’s trading session on the ASX, the SPI futures are anticipating the local market will commence the first trading session of October down 0.4%.
- On the commodities front this morning, oil is up 0.2% at US$68.30/barrel, gold is down almost 1% at US$2634/ounce and iron ore is up 0.5% at US$92.98/tonne.
- The Aussie dollar has strengthened again overnight to buy US$0.69, 99.33 Japanese Yen, 51.65 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Synlait Milk (ASX:SM1) from 47cps to 42.5cps and maintain a hold rating on the milk processing company following the release of the company’s FY24 results including adjusted EBITDA consistent with expectations and previous guidance. Sales rose 2% in FY24, and no guidance was issued. Bell Potter maintains a hold rating on the company as the outlook remains uncertain for Synlait Milk given its reliance on retaining milk supply post FY26 and convincing farmers to withdraw cessation notices.
- And Trading Central has identified a bullish signal on KMD Brands (ASX:KMD) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may rise from the close of 47cps to the range of 57 cents to 59 cents according to standard principles of technical analysis.
It was a mixed session to end the week on Wall St on Friday with the Dow Jones rallying 0.33% to a fresh record high while the S&P500 lost 0.13% and the Nasdaq ended the day down 0.4%. Encouraging inflation data boosted investor appetite for stocks on the Dow Jones industrials index. August’s personal consumption expenditures price index, which is the Fed’s preferred measure of inflation, increased 0.1% in the month which met economists’ expectations on a monthly basis, but the index rose 2.2% YoY which fell short of economists’ forecasts of 2.3%. While inflation remains under control the Fed can focus on a sustained rate cut outlook to stabilise the US economy.
Across the European region on Friday, markets closed in record territory as investors welcomed China’s new stimulus announcement and investors assessed key economic data. The STOXX 600 rose 0.52% to a record high while Germany’s DAX added 1.22%, the French CAC rose 0.64% and, in the UK, the FTSE100 ended the day up 0.43%. France and Spain both reported preliminary inflation data that showed a drastic drop in inflation in the regions which was welcomed by investors on Friday.
Across the Asia markets on Friday, markets rallied led by China’s CSI index posting its best week in almost 16 years with a rise of 15.7% for the week, on the back of China launching a large-scale stimulus package in a bid to reignite economic activity in the world’s second largest economy. Hong Kong’s Hang Seng rose 3.55% on Friday and 12.75% over the week and Japan’s Nikkei rose 2.32% after headline inflation eased to 2.2% from 2.6% in August.
Locally on Friday the ASX200 rose 0.1% to yet another fresh record high as a sharp rally for materials stocks offset losses among health care and real estate stocks. Mineral Resources led the winners on Friday with a near 14% boost, while Star Entertainment Group fell over 44% in the aftermath of the company released final FY24 results.
De Grey Mining rallied 3.4% on Friday after denying a media report that the gold miner had received a takeover offer from Canada’s Agnico Eagle.
Vulcan Energy Resource rose 5.8% on Friday after the company bought 100% of shares in geothermal wells operator, Geo GmbH.
What to watch today:
- Ahead of Monday’s trading session the SPI futures are anticipating the ASX to open the day up 0.27% tracking the Dow’s record on Wall St on Friday.
- On the commodities front this morning oil is trading 0.75% higher at US$68.18/barrel, gold is down 0.53% at US$2658.40/ounce and iron ore is up 0.48% at US$92.98/tonne.
- The Aussie dollar has further strengthened against the greenback to buy US$0.69, 98.40 Japanese Yen, 51.61 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Brickworks (ASX:BKW) from $29.50 to $31.00 and have downgraded the rating on the industrial conglomerate from a buy to a hold following the release of a robust FY24 result including EBIT down 8% but this beat Bell Potter expectations by 11%, core net debt increasing to $682m and outlook for FY25 remaining subdued on a building products front.
- And Trading Central has identified a bullish signal on Acrow (ASX:ACF) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $1.07 to the range of $1.10 to $1.12 according to standard principles of technical analysis.
The Aussie market experienced investors grapple with rate hike decisions, economic uncertainties, and surprising corporate news this week. The RBA maintained its cash rate at 4.35%, while the Federal Reserve faces increasing pressure to avoid a recession. Amidst this backdrop, luxury fashion platform Cettire (ASX:CTT) delivered impressive financial results, defying economic headwinds.
In this week’s wrap, Grady covers:
- (0:24): the RBA’s decision to hold the cash rate despite inflationary pressures
- (1:56): how the US economy has reacted to the Fed’s rate hike strategy
- (2:35): Cettire’s strong financial results
- (4:32): how the ASX200 performed this week so far
- (5:18): the most traded stocks & ETFs by Bell Direct clients
- (5:48): economic news items to watch out for.
Wall St closed lower overnight as the Dow Jones ended a 4-day winning streak losing 0.7%. The S&P500 dropped 0.19% and the tech-heavy Nasdaq gained just 0.04%. In terms of US stocks, both General Motors and Ford fell more than 4% following downgrades from Morgan Stanley.
Over in Europe, markets fell as the China-fuelled rally lost momentum. The STOXX600 closed 0.11% with half of the major sectors ending the trading day in the red. Germany’s DAX dropped 0.41%, the French CAC lost half a percent and over in the UK the FTSE100 ended Wednesday’s trading session 0.17% lower.
Locally yesterday, the ASX200 fell 0.13% with the majority of sectors closing in the red. Losses were led by the financial and consumer staples sectors which fell 1.87% and 1.86% respectively. This was offset by the materials sector which rose by 2.42% yesterday.
Monthly inflation data was also released yesterday coming it at 2.7%, which was below its previous result of 3.5% and the forecast of 3.1%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.21% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.58% lower at 69 US dollars and 71 cents a barrel, following concerns of supply disruptions in Libya after an agreement to appoint a central bank governor was made.
- Gold is trading slightly lower, down 0.03% at 2657 US dollars an ounce and iron ore is trading 0.31% higher at 91 US dollars and 88 cents a tonne.
Trading Ideas:
- Bell Potter has initiated coverage on Netwealth Group (ASX:NWL) with a hold rating. Netwealth Group provides integrated wealth management products to financial intermediaries and their clients. Through its web-based platform, NWL offers end-customers and array of Wrap and Superannuation based portfolio and investment management tools, enabling a transparent and efficient way to buy & sell, monitor and administer assets.
- Trading Central has identified a bearish signal Transurban Group (ASX:TCL), indicating that the stock price may fall from the close of $13.21 to the range of $12.40-$12.55 on a pattern formed over 26 days, according to the standard principles of technical analysis.
Wall Street’s record rally run continued from Monday with the S&P500 up 0.25% to a fresh record, while the Dow Jones added 0.2% to a record close and the Nasdaq added 0.56%, led by AI market darling Nvidia rallying 4%. Investors shook off recent worrying economic data including US manufacturing PMI data hitting the lowest level in 15-months for August, and consumer confidence falling to 98.7 points for September, to extend the recent equity rally on the back of the Fed’s 50 basis point rate cut announcement late last week.
In Europe overnight markets closed higher in the region led by stocks exposed to China following Beijing’s announcement of a range of policy measures easing in a bid to stimulate the economy. The STOXX600 rose 0.6%, while Germany’s DAX added 0.8%, the French CAC rose 1.28% and, in the UK, the FTSE100 ended the day up 0.28%.
The local market fell 0.13% on Tuesday, extending the weekly decline after the RBA held interest rates higher for longer. Rate sensitive tech stocks came under pressure on Tuesday as a higher interest rate environment makes debt levels more costly, thus blowing out the profitability runway for high growth companies.
The RBA held Australia’s cash rate at 4.35% for the next period as was widely expected with commentary out of Australia’s central bank signalling the most recent projections for inflation in Australia indicate that it will be some time yet before inflation substantially hits the target 2-3% range. Without inflation taming to the target 2-3%, the RBA’s elevated rate of 4.35% will continue to hurt earnings for companies with higher input costs and subdued demand due to a high cost of living environment for all Australians.
The RBA’s rate decision boosted the Aussie dollar to a 2024 record high against the greenback of 68.84 US cents.
What to watch today:
- Ahead of the midweek trading session locally, the SPI futures are anticipating the ASX to open the day up 0.37% tracking Wall Street’s rally overnight.
- On the commodities front this morning, oil is trading 1.76% higher at 71 US dollars and 61cents a barrel, gold is up 1.18% at 2657 US dollars an ounce and iron ore is down 0.36% at 91 US dollars and 60 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Light & Wonder (ASX:LNW) and has a 12-month price target of $161. Bell Potter’s valuation implies a 19.7% share price growth of the current share price of $134.53, hence the buy rating is maintained.
Wall St shook off the mixed closed to last week with a record finish on Monday as the S&P500 rose 0.28% to a record high 5,718.57 points while the Dow Jones added 0.15% to another record 42,124.65 and the Nasdaq ended the day up 0.14%. Investors overlooked the latest US economic data in the form of a 15-month low for manufacturing PMI activity in the US for August to welcome the Fed’s rate cut outlook. Investors will now look forward to the latest weekly jobless claims data out later this week.
European markets also started the week in positive territory investors assessed fresh business activity data out in the region. The STOXX600 rose 0.4%, Germany’s DAX rose 0.68%, the French CAC added 0.1% and, in the UK, the FTSE100 ended the day up 0.36%.
Across the Asia region on Monday in mostly positive territory as investors assessed monetary policy decisions out of China and Japan last week with both central banks maintaining rates steady for the next period. China’s CSI index rose 0.37%, Hong Kong’s Hang Seng fell 0.2%, The Taiwan
Weighted Index added 0.57% and Japan’s Nikkei was closed for a holiday.
Locally to start the week, the ASX200 fell 0.7% at the closing bell on Monday to snap a 7-day winning streak as a sharp sell off in the big supermarkets weighed on the consumer staples sector while real estate and discretionary stocks also fell 1.6% and 1.32% respectively.
Woolworths and Coles, the big supermarket giants, fell 3.4% and 3.3% respectively on Monday after the ACCC said the companies were misleading shoppers with claims they were dropping prices when they were actually increasing them. Both supermarket giants could be facing tens of millions of dollars in penalties.
Iron ore miners were once again under pressure yesterday amid a decline in the price of the key commodity on the back of renewed concerns about demand out of China as the world’s second largest economy continues its sluggish post pandemic recovery.
Boss Energy soared over 8% on Monday in the wake of a megadeal by Microsoft to restore life to a major US nuclear plant. The deal will see Microsoft buy 100% of its power for 20-years, which drove the price of uranium and subsequently, Boss Energy on Monday as Boss Energy’s 30% stake in the
Alta Mesa uranium mine in south Texas now becomes more valuable in the global ramp up of nuclear power.
All eyes today will be on the RBA as the latest rate decision will be announced this afternoon with the market expecting Australia’s central bank to maintain the current cash rate at 4.35%.
What to watch today:
- Ahead of Tuesday’s trading session locally the SPI futures are anticipating the ASX to open the new trading day down 0.11% taking no lead from Wall Street’s rally overnight.
- On the commodities front this morning oil is trading almost half a % lower at US$70.67/barrel, gold is up 0.23% at US$2627.6/ounce and iron ore is down 0.11% at US$91.93/tonne.
- AU$1.00 is buying US$0.68, 98.23 Japanese Yen, 51.27 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the rating on Imdex (ASX:IMD) from a sell to a hold and raised the 12-month price target on the company from $1.90 to $2.05 after the analyst reviewed the investment thesis behind the company to adopt a balanced near-term view on exploration activity and demand growth for the company’s products which are end-to-end mining product technology solutions. With anticipated demand for Imdex products set to grow over the next 6-9 months.
- And Trading Central has identified a bearish signal on Monadelphous Group (ASX:MND) following the formation of a pattern over a period of 46-days which is roughly the same amount of time the share price may fall from the close of $12.33 to the range of $10.40 to $10.80 according to standard principles of technical analysis.
Wall Street closed mixed on Friday with the Dow Jones rising to yet another record high, ending the day up 0.09% to 42,063 points while the S&P500 and Nasdaq each retreated 0.19% and 0.36% respectively. Investors fear the Fed is needing to cut rates aggressively to avoid a recession as inflation is coming down faster than expected.
Over in Europe, markets closed lower on Friday following a slew of central bank decisions in the region including the Bank of England holding rates steady for the month ahead despite the Fed cutting rates. The STOXX 600 fell 1.45% on Friday while Germany’s DAX lost 1.5%, the French CAC fell 1.51% and, in the UK, the FTSE100 ended the day down 1.2%.
Across the Asia markets on Friday, it was sea of green at the close after the Bank of Japan kept its benchmark interest rate steady at around 0.25% for the next period. Japan’s Nikkei rose 2.8%, China’s CSI index added 0.16%, Hong Kong’s Hang Seng rose 1.27% and South Korea’s Kospi Index ended the day up 0.5%.
Locally on Friday the ASX200 rose to yet another record close, ending the day up 0.2% at 8209.50 points, tracking global optimism on the back of the Fed’s 50bps rate cut announced earlier last week. Consumer discretionary stocks led the charge on Friday with a 1.12% gain while tech stocks rose 0.56% and utilities stocks ended the day up 0.41%. For the week the ASX200 rose 1.35%.
Department store giant Myer fell more than 10% on Friday after reporting a slump in profit and sales for FY24 with results including total profit after tax falling 26% to $52.6m and the company’s dividend was cut to 5cps.
Telix Pharmaceuticals on the other hand rocketed over 7% on Friday after the cancer imaging and therapy producer announced Cardinal Health as its US commercial distributor for Zircaix, the company’s kidney imaging agent which is currently in FDA submission stages for approval.
What to watch today:
- Ahead of the first trading session of the new week the SPI futures are expecting the ASX to open the day down 0.82%.
- On the commodities front this morning, oil is trading 0.16% higher at US$71.13/barrel, gold is flat at US$2621.53/ounce and iron ore is down 0.11% at US$91.93/tonne.
- The Aussie dollar has strengthened to buy US$0.68 cents, 97.89 Japanese Yen, 51.3 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has initiated coverage of Coles Group (ASX:COL) with a buy rating and 12-month price target of $21.55 as the analyst sees Coles as providing an attractive earnings growth profile through to FY27 on an underlying basis with high levels of cash generation supporting growth in dividends.
- And Trading Central has identified a bullish signal on Lindsay Australia (ASX:LAU) following the formation of a pattern over a period of 41-days which is roughly the same amount of time the share price may rise from the close of 94cps to the range of $1.03 to $1.05 according to standard principles of technical analysis.
The Federal Reserve’s decision to lower interest rates was welcomed by Australian investors this week. Learn why the US rate cut boosted the local market and explore why the recent dip in oil prices is likely to be short-lived.
In this week’s wrap, Grady covers:
- (0:10): how Wall St reacted to the Fed’s rate cut
- (1:20): the recent data signalling economic stability in the US
- (2:08): why the US rate cut is a positive for our local market
- (5:01): the most traded stocks & ETFs by Bell Direct clients
- (5:29): economic news items to watch out for.
The US market closed lower on Wednesday despite the Fed announcing a 50-basis point rate cut in the first rate cut of the interest rate cycle as inflation continues to ease in the world’s largest economy. The Dow Jones fell 0.25% on Wednesday while the S&P500 lost 0.35 and the tech-heavy Nasdaq ended the day down 0.31%. Investors likely responded to the 50-basis point rate cut with concerns over the Fed potentially cutting aggressively in fear of further weakening to the US economy in the months to come.
Over in Europe on Wednesday, markets closed lower as investors assessed key economic data released in the region. The STOXX 600 fell 0.5%, Germany’s DAX lost 0.08%, the French CAC fell 0.57% and, in the UK, the FTSE100 ended the day down 0.68%. UK inflation data for August was released yesterday with a flat reading on July of 2.2%, which comes ahead of the Bank of England’s rate decision on Thursday UK time where it is expected the BoE will maintain the current cash rate of 5% for another period.
The Asia region closed mostly higher on Wednesday as investors in the region digested key economic data including Japan’s exports and imports rising 5.6% and 2.3% respectively in August and the country’s trade deficit easing over the month. Japan’s Nikkei rose 0.5% on Wednesday while China’s CSI index rose 0.37% and South Korea and Hong Kong’s markets were closed for a holiday.
Locally on Wednesday, the ASX 200 ended the midweek session flat after setting a fresh record close on Tuesday as a decline in the price of iron ore hit the big miners.
Underwhelming economic data out of China over the weekend placed further pressure on the iron ore price as the world’s second largest economy continues its struggle to regain economic expansion and stability post pandemic.
Rio Tinto and BHP each fell just shy of 1%, while FMG ended the day down 0.3%.
Harvey Norman shares closed flat on Wednesday despite the homewares retailer being hit with a class action accusing the retailer of allegedly selling hundreds of millions of dollars of unnecessary and worthless extended warranties. Harvey Norman said it complied with all relevant laws.
Biotech company Imugene received a long-awaited Orphan Drug Designation from the FDA for its CF33-hNIS vaxinia to treat cholangiocarcinoma (COLAN-GIO-CARCINOMA) which is a rare form of bile tract cancer. Shares in the company rose 6.25% yesterday.
What to watch today:
- All eyes locally today will be on Australia’s latest jobs data which is out this morning with the market expecting the unemployment rate to remain flat at 4.2% while it is forecast that the employment change is expected to drop to an increase of just 28,000 in August from the high jump of 58.2k reported in July.
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX to open the new trading day down half a percent tracking Wall Street’s loss overnight.
- On the commodities front this morning oil is trading 1.66% lower at US$70/barrel, gold is down 0.6% at US$2558.84/ounce, and iron ore is up 0.04% at US$91.98/tonne.
- The Aussie dollar has strengthened overnight to buy 67.65 US cents, 96.13 Japanese Yen, 51.23 British Pence and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Bell Potter has initiated coverage of Genesis Minerals (ASX:GMD) with a buy rating and a 12-month price target of $2.55/share. Genesis Minerals is a Western Australian gold production and development company focused on the Leonora District with two gold processing plants and four mining centres under the company’s belt as well as two critical deposits boasting high grade gold. The company’s value is in its 10-year long-term growth plan and the restart of the Laverton plant in December 2024.
- Trading Central has identified a bullish signal on Adairs (ASX:ADH) following the formation of a pattern over a period of 17-days which is roughl
Overnight, Wall St closed flat as investors await for the Federal Reserve interest rate decision in the US on Wednesday. The Dow Jones fell 0.04%, the S&P500 rose 0.03% and the tech heavy Nasdaq jumped 0.2%.
The Federal Reserves interest rate decision will be announced after local market close today following the aggressive hiking campaign that started in March 2022, which could help boost earnings growth for companies following recent high borrowing costs and inflation.
Over in Europe, markets closed higher as they rebounded from a negative session to start the week. The STOXX600 ended Tuesday’s trading session 0.42% in the green with banks leading gains up 1%. Germany’s DAX and the French CAC both gained half a percent and over in the UK, the FTSE100 rallied by 0.38% by market close.
Locally yesterday, the ASX200 rose by 0.24% by market close yesterday with all major sectors closing in the green. Gains were led by the information technology and real estate sectors which gained 1.07% and 0.71% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.48% at market open today.
-
On the commodities front this morning,
- Oil is trading 1.33% higher at 71 US dollars and 2 cents a barrel as it is expected that demand for oil will rise once the Federal Reserve cuts rates overnight.
- Gold is trading 0.55% lower at 2569 US dollars an ounce and iron ore fell 0.35% at 91 US dollars and 94 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Austal Limited (ASX:ASB) and has a 12-month price target of $3.15. The buy rating is maintained by Bell Potter following the announcement of a $670 million contract from General Dynamics Electric Boat to expand its shipyard in Alabama by designing and constructing a new module fabrication and outfitting facility to support the US Navy Submarine Industrial Base. It is believed by Bell Potter that this is a significant update for ASB that will diversify its shipbuilding operations, drive long-term revenue growth, and reinforce its position as a key contributor to the US naval industrial base, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Accent Group (ASX:AX1), indicating that the stock price may rise from the close of $2.27 to the range of $2.90-$3.05, on a pattern formed over 194 days, according to the standard principles of technical analysis.
Wall St started the new trading week with a mixed session ahead of the commencement of the Fed’s FOMC meeting where it is expected a rate cut of 0.25% will be announced as the US inflation rate continues to ease to the target 2% while the economy remains robust enough to avoid a recession. The S&P500 reversed morning losses to close Monday’s session up 0.13% while the Dow Jones rose 0.55% to a fresh record 41,622.08 points. The tech-heavy Nasdaq ended Monday’s session down 0.52% though as Apple shares weighed on the tech index.
Over in Europe, markets closed mostly lower on Monday ahead of key interest rate decisions out around the world this week. The STOXX 600 fell 0.2% on Monday, Germany’s DAX lost 0.35%, the French CAC fell 0.21%, and, in the UK, the FTSE100 ended the day up 0.06%. The Bank of England rate decision is announced on Thursday where it is widely expected the BoE will maintain the current cash rate of 5% for another period following the first 25 basis points rate cut announced in August.
Across the Asia region on Monday markets rose as investors assessed key economic data out of China including August factory, retail sales and fixed asset investment all rising by less than economists’ were expecting in data out over the weekend. China and South Korea’s markets were closed on Monday for the mid-Autumn festival, while Hong Kong’s Hang Seng rose 0.13% on Monday.
Locally on Monday, the ASX200 rose 0.27% taking lead from Wall Street’s rally on Friday ahead of the Fed’s next FOMC meeting where it is widely expected the Fed will announce the first interest rate cut of this cycle as inflation eases in the US.
Gold stocks rose on Monday as the price of the precious commodity rose 0.41% to US$2589/ounce. Evolution Mining, Regis Resources and Northern Star Resources each ended Monday’s session in the green.
Qantas shares rallied yesterday after the national carrier announced it is raising the cost of changing airfares booked with the airline by 20% which increases income for the flying kangaroo.
Australian-based global ship maker, Austal jumped over 17% on Monday after announcing it had won a US$450m contract with General Dynamics Electric Boat to expand production capacity at its US shipyard in support of the US Navy Submarine Industrial Base (SIB).
What to watch today:
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX to open the day up 0.65%.
- On the commodities front this morning, oil is trading 2.73% higher at US$70.53/barrel, gold is up 0.16% at US$2582/ounce, and iron ore is down 0.86% at US$92.26/tonne.
- The Aussie dollar has strengthened to buy US$0.67, 94.98 Japanese Yen, 51.04 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has initiated coverage of Champion Iron (ASX:CIA) with a buy rating and a 12-month price target of $7.15/share. Bell Potter’s analyst sees the company’s shift into higher grade production will likely support average realised prices and earnings amid an iron ore price environment generally expected to weaken. CIA will benefit from maturing high-grade iron concentrate markets that recognise emission reduction benefits. CIA is a dividend payer and the analyst expects earnings to continue to support dividends.
- And Trading Central has identified a bearish signal on Kelsian Group (ASX:KLS) following the formation of a pattern over a period of 12-days which is roughly the same amount of time the share price may fall from the close of $3.99 to the range of $3.25 to $3.40 according to standard principles of technical analysis.
On Friday, Wall St closed higher to cap off what was the best week of 2024. The Dow Jones rose by 0.72%, the S&P500 jumped over half a percent and the tech heavy Nasdaq gained 0.65%.
In terms of US stocks, Alphabet rose 1.8% and Uber added more than 6%.
Over in Europe, markets closed higher to end the trading week following the European Central Bank’s decision to cut rates. The STOXX600 closed 0.72% higher with nearly all major sectors ending the day in the green. Gains were led by retail and autos stocks which jumped 1.84% and 1.6% respectively. This was offset by food and beverage stocks which fell 0.32%. Germany’s DAX climbed nearly 1%, the French CAC rose by 0.41% and over in the UK, the FTSE100 ended Friday’s trading session 0.39% higher.
Locally on Friday, the ASX200 rose by 0.3% with half of the major sectors ending the day positively. Gains were led by the materials and real estate sectors which rose by 2.25% and 1.02% respectively. This was offset by the financial sector which fell 0.61% by market close.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.2% at market open this morning.
- Oil is trading 0.46% lower at 68 US dollars and 65 cents a barrel, gold is trading 0.78% higher at 2578 US dollars an ounce and iron ore is trading 0.86% lower at 92 US dollars and 26 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Champion Iron (ASX:CIA) and has a 12-month price target of $7.15. Bell Potter’s valuation implies a 24% share price growth of the current share price of $5.76, hence the buy rating is maintained.
The global economic landscape is a dynamic interplay of inflation, interest rates, and geopolitical events. As investors navigate this evolving environment, key economic indicators continue to shape market movements. From China’s struggling inflation to the United States’ resilient economy, this week’s economic data has offered a missed bag of signals. As we delve deeper into the details, it becomes evident that the path toward economic stability and growth is still fraught with uncertainties.
In this week’s wrap, Grady covers:
- (0:11): how economic indicators continue to drive market movements
- (0:46): why China’s economy faces challenges
- (2:58): what the United States’ economic resilience demonstrates
- (5:25): how the ASX200 performed this week so far
- (6:07): the most traded stocks & ETFs by Bell Direct clients
- (6:38): economic news items to look out for.
Wall St closed higher overnight as the S&P 500 records its fourth straight winning day up 0.75%. The Dow Jones rose 0.58% and the tech heavy Nasdaq rose by 1% as investors anticipate a rate cut by the Federal Reserve next week.
Over in Europe, markets closed in the green following a 25 basis point rate cut from the European Central Bank. The STOXX600 ended the trading session 0.78% higher with all major sectors closing positively. Germany’s DAX closed up over 1%, the French CAC jumped over half a percent and over in the UK the FTSE100 rallied 0.57%.
Locally yesterday, the ASX200 closed 1.1% higher by market close will all major sectors ending Thursday’s trading session in the green. Gains were led by the information technology and energy sectors which climbed 2.44% and 2.32% respectively.
What to watch today:
- The Australian share market is set to open higher with the SPI futures suggesting a rise of 0.56% at market open this morning.
- On the commodities front this morning,
- Oil is trading 2.75% higher at 69 US dollars and 16 cents a barrel following disruptions from storm Francine in the Gulf of Mexico which has led to the shutdown of around 670,000 barrels a day.
- Gold is trading 1.87% higher at 2558 US dollars an ounce and iron ore rallied 1.12% to 92 US dollars and 30 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Genusplus Group (ASX:GNP) and has an unchanged 12-month price target of $2.70. Bell Potter’s valuation implies a 18.4% share price growth of the current share price of $2.28, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on Lindsay Australia (ASX:LAU), indicating that the stock price may rise from the close of $0.91 to the range of $0.98-$1, on a pattern formed over 23 days, according to the standard principles of technical analysis.
Overnight, Wall St closed higher as investors reacted to the latest US inflation data readings and what it could mean for the Federal Reserve policy. The Dow Jones gained 0.31%, the S&P 500 rose by 1.07% and the tech-heavy Nasdaq ended Wednesday’s trading session 2.17% higher.
In terms of US inflation data, core inflation year on year remained the same as its previous result and in line with the consensus of 3.2%. And the inflation rate year on year came in 0.2% below the forecast of 2.7% at 2.5%. Investors are now pricing in an 85% chance that the US central bank will approve a 25 basis point interest rate reduction in September, according to the CME Group’s FedWatch measure.
Over in Europe, markets ended Wednesday’s session mixed following the release of US inflation data. The STOXX600 closed 0.02% higher after a volatile day of trading with tech stocks gaining 1.21%, whilst industrials and household good stocks fell 0.4% each. Germany’s DAX gained 0.35%, the French CAC dropped 0.14% and over in the UK the FTSE100 lost 0.15% by market close.
Locally yesterday, the ASX200 fell 0.3% lower yesterday with the majority of stocks closing in the red. Losses were led by the financial and energy sectors which dropped 1.46% and 1.41% respectively. This was offset by the materials sector which rose by 1.67%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.63% at market open this morning.
- On the commodity front this morning,
- Oil is trading 2.41% higher at 67 US dollars and 33 cents a barrel after hitting a near three-year low in its previous session.
- Gold is trading 0.29% lower at 2511 US dollars an ounce and iron ore is trading over half a percent lower at 91 US dollars and 28 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Adrad Holdings (ASX:AHL) and has an unchanged 12-month price target of $1.12. Bell Potter’s valuation implies a 48.3% share price growth of the current share price of $0.75, hence the buy rating is maintained.
Wall Street rallied in the final hours of trade on Tuesday to post a positive finish across the major averages as investors bought into higher growth stocks which boosted the Nasdaq to a 0.84% gain at the closing bell. The S&P500 rose 0.45% on Tuesday and the Dow Jones reversed losses to end the day up 0.23%. Investors in the US are now bracing for key inflation data out in the US on Wednesday with the expectation of further easing of the inflation rate, while the core inflation rate month on month is expected to rise slightly.
In Europe overnight, auto stocks weighed on the key regions leading to a red finish across European markets on Tuesday. The STOXX600 fell 0.66%, Germany’s DAX lost 0.96%, the French CAC fell 0.24% and, in the UK, the FTSE100 ended the day down 0.78%. Car parts supplier Continental fell 10% on Tuesday after the company said It saw provisions in the mid double digit million-euro range due to a warranty case involving one of its brake systems, while BMW shares fell 11% on Tuesday.
Across the Asia region on Tuesday, markets were mixed as investors responded to key economic data out in the region. China’s exports grew 8.7% YoY in August and imports rose 0.5% in trade balance data out yesterday indicating recovery of output in the world’s second largest economy. China’s CSI index closed flat on Tuesday, South Korea’s Kospi index fell 0.5%, Japan’s Nikkei rose 0.16% and Hong Kong’s Hang Seng ended the day up 0.37%.
The ASX had a strong rally on Tuesday with a 0.3% gain at the closing bell to hit 8011.898 points, on the back of the US rally on Monday as investors assessed key Westpac consumer confidence data and NAB business confidence data released yesterday.
Westpac consumer confidence data for September out on Tuesday came in at a fall of 0.5% which was less than economists were expecting (1.2%), but still indicated a slide from August as consumer confidence was hit by the sluggish GDP growth in Q2 for Australia and the overall stability of the Australian economy.
NAB Business confidence data for August also out yesterday indicated business confidence fell 3 points in August to -4 index points, compared to market expectations of a rise to 3 points.
The slide in business confidence was driven by declining employment and cost inputs eating away at margins.
Iron ore miners had a reverse of Monday’s start to the week with a boost yesterday on the back of a rise in the price of the commodity on news that improved seasonal demand for steel in China and hopes of stimulus out of Beijing will drive material demand increase for the coming months.
According to the consultancy Mysteel, September is usually a high-demand period for steel in China. However, last week saw lower demand due to concerns about both the Chinese and US economies.
CBA rallied to all time high yesterday as the big banks rallied again, while Life360 pulled back yesterday after the stock traded lower on the Nasdaq overnight, and an early investor and independent non-executive director sold 100,000 shares worth $3.7m.
What to watch today:
- Ahead of the midweek trading session on the ASX, the SPI futures are anticipating the local market to open the day up 0.1% following Wall Street’s rally overnight.
- On the commodities front this morning, oil has tumbled overnight to trade 4% lower at US$65.96/barrel, gold is up 0.4% at US$2515.85/ounce and iron ore is up 0.16% at US$91.76/tonne.
- The Aussie dollar has slightly strengthened against the greenback overnight to buy US$0.66 cents, 94.81 Japanese Yen, 50.88 British Pence and NZ$1.08
Trading Idea:
- Trading Central has identified a bullish signal on Lycopodium (ASX:LYL) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may rise from the close of $12.22 to the range of $14.60 to $15.10 according to the standa
Over in the US, Wall Street started the new trading week in positive territory as investors bought into the dip following Wall Street’s worst week in a year last week. The Dow Jones rose 1.2% on Monday, the S&P500 climbed 1.16% in recovery after the index posted its worst week since March 2023 last week, and the tech-heavy Nasdaq ended Monday’s session up 1.16%. Investor eyes in the US are now firmly focused on the Fed’s rate decision with the expectation of a cut to be announced later this month.
In Europe overnight, it was a positive start to the week in the region as the STOXX 600 rose 0.76% led by travel and leisure stocks, while Germany’s DAX added 0.77%, the French CAC rose 0.99% and, in the UK, the FTSE100 ended Monday’s trading session up 1.09%.
Across the Asia markets on Monday, key economic data out in the region painted a picture of eased economic stability which weighed on investor sentiment on Monday. Japan’s Q2 GDP came in at 2.9% on an annual basis which fell short of economists’ expectations of a 3.2% rise. Japan’s Nikkei closed Monday’s session down 0.48%, Hong Kong’s Hang Seng lost 1.42%, and China’s CSI index ended the day down 1.2%.
On Monday, China’s consumer price index climbed by 0.6% YoY in August which fell short of economists’ expectations and paints a further concerning picture about the economic recovery of the world’s second largest economy. China’s producer price index also fell 1.8% YoY in August which was also a worse reading than economists’ were expecting led by declines in the prices of oil, coal and other fuel industries due to insufficient domestic demand and a drag from the country’s real estate sector.
What to watch today:
- The local market started the new trading week in negative territory with a fall of 0.32% as investor sentiment was dampened by jobs data out in the US on Friday signalling a weakening labour environment in the world’s largest economy.
- The big banks and energy stocks led the losses on Monday while rate sensitive real estate and tech stocks rallied to offset some of the heavy losses.
- Domino’s Pizza (ASX:DMP) shares fell over 2.5% on Monday after the pizza giant was served with a class action from shareholders on allegations the company misled investors in 2021 about expected performance in Japan. Domino’s has said it will defend against the legal proceedings and denies any liability.
- Looking at commodities, oil is trading 1.5% higher at US$68.68/barrel, gold is up 0.66% at US$2503/ounce and iron ore is up 0.34% at US$91.61/tonne.
- The Aussie dollar has slightly weakened overnight to buy 66.68 US cents, 95.17 Japanese Yen, 50.87 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of Tuesday’s training session the SPI futures are anticipating the ASX to open the day up just shy of 1% following the rally on Wall St on Monday.
- We will likely see investors react to Westpac’s consumer confidence data for September out this morning with the forecast of a 1.2% decline from a 2.8% rise in August, while NAB business confidence data for August is also out today with the forecast of a rise to 3 points from 1 point in July.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Premier Investments (ASX:PMV) from $35 to $37 and maintain a buy rating on the leading retail investment company following the release an update out of the company including FY24 post-AASB-16 (lease related payments guide) EBIT of $341m. The increase in the price target is due to Bell Potter’s analyst seeing upside to the company’s share price from the potential demerger of PMV’s two-key brands, Smiggle and Peter Alexander which are highly profitable and global roll out worthy.
- Trading Central has identified a bearish signal on Orora (ASX:ORA) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price m
Wall Street closed lower across the board on Friday as investors assessed the August jobs report which was released on Friday morning. The S&P500 fell 1.73% to post its worst week since 2023 with a 4.3% decline over the 5-trading days, while the Nasdaq tumbled 2.55% on Friday and the Dow Jones ended the day down 1.01%. The jobs data out for August on Friday indicated non-farm payrolls rose by 142,000 compared to economists’ expectations of 161,000, but the unemployment rate fell to 4.2%, painting a mixed picture about the strength of the US jobs market. Investors took the weaker-than-expected reading in non-farm payrolls as a signal of economic weakness and as a result sold out of equities on Friday.
Over in Europe, markets closed Friday’s session lower in the worst week since the early August slump as the US jobs report clouded investor sentiment around global economic stability. The STOXX600 fell 1.15%, Germany’s DAX lost 1.48%, the French CAC fell 1.07% and, in the UK, the FTSE100 ended Friday’s session down 0.73%.
Across the Asia region on Friday the sea of red mostly extended across the region as key economic data weighed on investor sentiment including Japan’s household spending data for July rising just 0.1% on the previous year, compared to the 1.2% rise economists were expecting. Japan’s Nikkei fell 0.72%, South Korea’s Kospi Index lost 1.21% and China’s CSI index ended the day down 0.81%.
Locally on Friday the ASX200 rose 0.4% with the bankers driving the positive close to offset some of the heavy losses experienced this week. Energy stocks tumbled over 3% on Friday, extended the week’s losses amid the volatile price of oil, while consumer discretionary stocks rallied 1% on the final trading session of last week.
Materials stocks came under pressure on Friday after China’s steel advisory group advised mills to be cautious on boosting outlook on fears of subdued demand and subdued pricing. Therefore, impacting iron ore prices late last week and the local miners were sold off as a result.
Strike Energy soared almost 9% on Friday in the days after the gas exploration and development company released plans to expand the Eastern Perth Basin with major discoveries at its Erregulla Deep-1 exploration well.
What to watch today:
- Ahead of the first trading session of the new trading week, the SPI futures are expecting the ASX to open the day down 1.28% following the Wall St slide last week.
- On the commodities front this morning, oil is trading 0.80% higher at US$68.20/barrel, gold is up 0.41% at US$2497/ounce and iron ore is up 0.34% at US$91.61/tonne.
- AU$1.00 is buying US$0.66 cents, 50.79 British Pence, 94.86 Japanese Yen, and NZ$1.08.
Trading Idea:
- Bell Potter has increased the 12-month price target on GrainCorp (ASX:GNC) from $9.90 to $10.20 and maintain the buy rating following the release of the ABARE September 2024 east coast winter crop forecast reflecting a 6% upgrade relative to the record June 2024 estimate to 28.8million tonnes. The consensus EBITDA FY25 expectations for GNC of $320m imply an outcome consistent with GNC’s through-the-cycle EBITDA projection, which appear conservative especially if the basis trade emerges over harvest which Bell Potter would expect to occur on a winter crop of this magnitude.
The Australian market has just weathered a turbulent reporting season for FY24, with many companies struggling under the weight of rising interest rates and inflationary pressures. Despite a handful of standouts, the overall outlook for FY25 is cautiously pessimistic. As we dive deeper into the key takeaways and predictions for the coming year, it's clear that businesses will need to adapt to a more challenging economic landscape.
In this week’s wrap, Grady covers:
- (0:46): how weakening commodity prices influenced the resources sector
- (1:37): why dividends were on the chopping block
- (3:08): how retailers performed this August
- (4:36): how the ASX200 performed this week
- (5:19): the most traded stocks by Bell Direct clients
- (5:45): economic news items to watch out for.
Wall St closed lower overnight as the S&P 500 and the Nasdaq fell for the second straight session to start September. The S&P 500 fell 0.16%, the tech-heavy Nasdaq ended the day 0.3% lower and the Dow Jones had a slight rise of 0.09%.
Over in Europe, markets closed lower on Wednesday’s trading session following losses on Wall St. The STOXX600 closed 1% lower with most sectors closing in the red. Losses were led by technology stocks which saw a 3.2% decline, whilst household goods also fell 2%. Germany’s DAX fell 0.83%, the French CAC closed nearly 1% in the red and over in the UK the FTSE100 dropped 0.35%.
Locally yesterday, the ASX200 closed 1.88% lower will all major sectors ending Wednesday’s trading session lower. Losses were led by the materials and energy sectors which fell 3.03% and 2.99% respectively.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise 0f 0.03% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 1.87% lower at US$68.90/barrel following concern from investors over future demand for oil.
- Gold is trading 0.09% higher at US$2495/ounce and iron ore is trading 1.87% higher at US$100.55/tonne.
Trading Idea:
- Bell Potter maintains a speculative buy rating on Curvebeam (ASX:CVB) which is a healthcare equipment and services company which combines market leading point-of-care diagnostic beam CT imaging solutions with Artificial Intelligence. Bell Potter’s valuation of $0.26, implies a 40.5% share price growth of the current share price of $0.185, hence the speculative buy rating is recommended.
Well, the Australian market closed yesterday’s session slightly lower, as consumer and mining stocks weighed on the ASX200, ahead of Australia’s GDP reading for Q2 out later this morning. Economists are expecting 0.3% growth, from 0.1% reported in Q1. The market may see a strong investor reaction if reports are below expectations, as the high-interest rate environment continues to weigh on the economy. Woolworths (ASX:WOW), Coles (ASX:COL) and Endeavour (ASX:EDV) shares were among the hardest hit yesterday, as each of the consumer staples company’s went ex-dividend.
US equities tumbled in the red overnight for the first US trading session of September. Technology heavyweights struggled to rally into the new month and fresh economic data came in weaker-than-expected. The market has seemed to be data dependent recently, as the Nasdaq declined 3.6%, the S&P500 down 2% and the Dow Jones closed 600 points or 1.5% lower.
European markets also closed in the red, with the STOXX600 down 0.97%.
What to watch today:
- Following US markets overnight, the SPI futures are suggesting that Australian market will drop 1.17% at the open this morning.
- In commodities,
- Crude oil is down 5% to US$70.36 per barrel, the lowest since the start of January as muted demand magnified the impact of relatively ample supply. Plus, new data out in China aggravated concerns that the economic growth from one of the largest oil consumers in the world, is unlikely to bounce back this year, after factory demand dropped more than expected in August. So keep watch of energy producers today, including Beach Energy (ASX:BPT) and Woodside Energy (ASX:WDS).
- Gold is trading slightly lower as the US dollar added pressure.
- And iron ore is trading in the green after weighing down on our large mining stocks yesterday, as weakness in China’s economic recovery and steel industry sparked yesterday’s iron ore price to drop below US$100 per tonne. BHP Group (ASX:BHP), Champion Iron (ASC:CIA) and Fortescue (ASX:FMG) were all lower.
- On that note, Fortescue is also set to go ex-dividend today, which may see FMG’s share price fall, as investors take their profits.
- And the Australian dollar is buying US$67.36, 97.92 Japanese Yen, 51.32 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter initiated coverage on Northern Star Resources (ASX:NST), the largest solely ASX listed gold mining company. Bell Potter initiate coverage with a Buy recommendation in accordance to their ratings structure. Their 12-month price target is $17.50 and that their current share price of $14.87, this implies 17.7% share price growth in a year.
- And Trading Central have identified a bearish signal on Goodman Group (ASX:GMG) indicating that the stock price may fall from the close of $33.07 to the range of $29.20 to $30.00 over 7 days, according to the standard principles of technical analysis.
Due to the Labour Day holiday over in the US, markets were closed in the region, however over in Europe, markets ended the day flat to start September. The STOXX600 closed 0.04% lower, with losses led by retail stocks which dropped 0.77%, whilst telecoms stocks added 0.78%. Germany’s DAX added 0.13%, the French CAC gained 0.2% and over in the UK the FTSE100 fell 0.15%.
Locally yesterday, the ASX200 rose 0.22% by market close yesterday. Gains were led by the financial and energy sectors which gained 1.14% and 1.1% respectively. This was offset by the materials sector which fell 1.11% by end of trade on Monday.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures predicting a rise of 0.05% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.7% higher at 74 US dollars and 6 cents a barrel, gold is trading 0.13% lower at 2499 US dollars an ounce and iron ore is trading 0.07% higher at 98 US dollars and 60 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Resource Development Group (ASX:RDG) and has a 12-month price target of $0.034. The buy rating is maintained by Bell Potter following the release of FY24 results in which RDG reported a revenue of $136m, up 145% year-on-year and an underlying EBITDA of $28.4m which was up 53% year-on-year. As well as this, RDG continues to focus on implementing modifications and upgrade works to the Lucky Bay plant to achieve nameplate capacity, with an upgraded New Constant Density tank commissioned during July 2024, yielding improved plant stability and greater heavy mineral recovery and production. An expanded attritioning circuit was also installed which will improve product quality, hence the buy rating is maintained.
- Trading Central has identified a bullish signal in Elders Ltd (ASX:ELD), indicating that the stock price may rise from the close of $9.37 to the range of $10.05-$10.20, on a pattern formed over 22 days, according to the standard principles of technical analysis.
Wall St closed higher on Friday to end what was a volatile month, with the Dow Jones posting a fresh record high. The S&P 500 gained over 1%, the tech-heavy Nasdaq jumped 1.13% and the Dow Jones ended the trading day over half a percent higher. US inflation data was released on Friday, with the personal consumption expenditure price index rising 0.2% in July, in line with economist expectations.
Over in Europe, markets closed lower as investors consumed the latest inflation data from around the world. The STOXX 600 closed 0.09% higher on Friday, Germany’s DAX fell 0.03%, the French CAC dropped 0.13% and over in the UK the FTSE100 ended Friday’s trading session 0.04% lower.
Locally on Friday, the ASX200 gained 0.58% with the majority of sectors finishing in the green. Gains were led by the industrial and energy sectors which gained 1.65% and 1.27% respectively. This was offset by the consumer discretionary sector which fell 0.46% by the closing bell.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.22% at market open this morning.
- On the commodity front this morning,
- Oil is trading 3.11% lower at 73 US dollars and 55 cents a barrel as investors factored in the likelihood of a rise in OPEC+ supply starting in October.
- Gold is trading 0.65% lower at 2503 US dollars an ounce and iron ore is trading 0.07% higher at 98 US dollars and 70 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Aeris Resources (ASX:AIS) and has a 12-monht price target of $0.27. The buy rating is maintained by Bell Potter following the release of FY24 results in which EBITDA came in ahead of Bell Potter forecasts and a revenue of $540m was recorded. AIS is a copper dominant producer with all its assets in Australia. Its near-term outlook is highly leveraged to the copper price and increasing grades and production at the Tritton copper mine. Successful delivery offers significant upside and a strategically attractive asset in Tritton, hence the buy rating is maintained.
- Trading Central has identified a bullish signal in IGO Ltd (ASX:IGO), indicating that the stock price may rise form the close of $5.55 to the range of $5.75-$5.83, on a pattern formed over 20 days, according to the standard principles of technical analysis.
ASX heavyweights released results this week that painted a mixed picture about the outlook for FY25. Over August, 275 companies released results, with 85 beating expectations. From soaring profits to unexpected setbacks, join Grady as she delves into the details and analyses the implications for investors.
In this week’s wrap, Grady covers:
- (0:37): how Wesfarmers shares declined following strong results
- (2:00): why Qantas’ share price ran into turbulence
- (2:51): what caused mining giant Mineral Resources to tumble
- (4:52): how the market performed this week so far
- (5:39): the most traded stocks & ETFs by Bell Direct clients
- (6:06): economic data to watch out for.
Wall St closed mixed on Thursday as the Dow Jones closed at fresh highs overnight. The tech-heavy Nasdaq fell 0.23%, the S&P500 remained flat and the Dow Jones gained 0.59% to end the trading day.
Over in Europe, markets closed higher as investors reacted to interest rate decisions across Europe. The STOXX600 closed 0-.74% higher with all major sectors ending Thursday’s trading session in the green. Gains were led by tech stocks which rose 2.05%, following the announcement of quarterly results from AI giant, Nvidia. Germany’s DAX rose 0.69%, the French CAC gained 0.84% and over in the UK, the FTSE100 rallied 0.43% by the closing bell.
Locally yesterday, the ASX200 ended Thursday’s trading session 0.26% higher, despite the majority of sectors closing in the red. The two major sectors which did end the day positive were the financial and real estate sectors which gained 1.46% and 1.19% respectively. This was offset by the information technology sector which fell 1.88%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.64% by market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.65% higher at 75 US dollars and 75 cents a barrel, gold is trading over half a percent higher at 2521 US dollars an ounce and iron ore is trading 0.06% higher at 98 US dollars and 51 cents a tonne.
Trading Idea:
- Bell Potter maintains a speculative buy rating on Matrix Composites & Engineering (ASX:MCE) and has increased its 12-month price target to $0.44. The speculative buy rating is maintained by Bell Potter following the release of FY24 results in which reported revenue was up 80% year-on-year, in line with guidance and forecast. MCE is also exposed to a protracted capital expenditure up-cycle across the global off-shore energy sector and is leveraged to growing activity across the global offshore floating wind sector, providing a medium-term earnings catalyst.
Wall Street closed lower at the end of the midweek session as investors braced for the release of Nvidia’s Q2 earnings results that were released after the closing bell. The Dow Jones fell 0.39% on Wednesday, the S&P500 lost 0.6% and the tech-heavy Nasdaq ended the day down 1.12%. Nvidia’s results have fast become one of the most important pieces of data the market analyses for outlook on growth in the AI revolution. For the second quarter, Nvidia reported record quarterly revenue of US$30bn, up 15% on Q1 and a rise of 122% from a year ago, record quarterly data centre revenue of $26.3bn was also reported which is a rise of 16% on Q1 and 154% from a year ago. In after-hours trade, Nvidia shares are down over 6.5% despite the company posting outlook for revenue growth to US$32.5bn in Q3.
Over in Europe on Wednesday, markets closed mostly higher in the region on strong corporate earnings results out in the region. The STOXX 600 rose 0.33%, Germany’s DAX added 0.54%, the French CAC rose 0.16%, and in the UK, the FTSE100 ended the day down just 0.02%.
Across the Asia region on Wednesday markets closed mixed as investors digested key economic data out in the region. Hong Kong’s Hang Seng fell 1.05% on Wednesday, China’s CSI index lost 0.57%, Japan’s Nikkei rose 0.22% and South Korea’s Kospi Index closed flat on Wednesday.
Locally on Wednesday, the ASX200 closed flat as investors responded to corporate earnings results and the release of key inflation data that came in slightly hotter-than-expected. Australia’s monthly CPI indicator rose 3.5% in the 12-months to July 2024, down from 3.8% in June, but above the 3.4% economists were expecting. The greatest contributors to the 3.5% rise for July were housing up 4%, food and non-alcoholic beverages up 3.8%, alcohol and tobacco up 7.2% and transport up 3.4%. The nation’s core inflation which strips out volatile metrics including fuel, fruit and holiday travel, was 3.7% for the year to July, down from 4% in June.
Woolworths shares rallied 3.4% on Wednesday after the supermarket giant reported strong FY24 results including a special dividend of 40cps.
Travel agency group Flight Centre also rallied nearly 2% yesterday after releasing FY24 results outlining airfares moderated and travel demand remained strong over the last financial year, with total transaction value topping $23.7bn for FY24, which was $1.8 bn more than FY23.
Fortescue shares fell 2% yesterday despite the mining giant reporting an 18% jump in net profit for FY24 to $8.4bn. Investors likely sold out due to the near $1bn loss reported for Fortescue’s green energy division.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open the day down 0.27% tracking turbulence on Wall St overnight.
- On the commodities front this morning, oil is trading 1.44% lower at US$74.45/barrel, gold is down 0.7% at US$2508/ounce and iron ore is up 0.15% at US$98.45/tonne.
- AU$1.00 is buying US$0.67, 97.94 Japanese Yen, 51.36 British Pence and NZ$1.09 cents.
Trading Ideas:
- Bell Potter has increased the rating on Fortescue (ASX:FMG) from a sell to a hold and have raised the 12-month price target on the mining giant from $17.41 to $17.58 following the release of the company’s FY24 results with the belief subdued outlook in priced into the current market price. FY24 results were reported broadly in-line with market expectations with moderately lower NPAT due to higher tax and D&A charges. The analyst believes the results in FY24 were solid but subdued iron ore outlook and interest rate differentials pointing to a stronger AUD to USD exchange rate, will pressure build on FMG’s margins.
- And Trading Central has identified a bullish signal on NRW Holdings (ASX:NWH) following the formation of a pattern over a period of 8-days which is roughly the same amount of time the
Over in the US, markets closed higher as investors await further key corporate earnings out later this week. The Dow Jones rose by 0.02%, the S&P500 rallied 0.16% and the tech-heavy Nasdaq ended the day 0.16% in the green.
Investors are eagerly awaiting the release of results from AI and chip making giant Nvidia, which will come out after the closing bell on Wednesday, to gain insight into the growth potential for the company and broader tech sector.
In Europe overnight, markets closed mostly higher as investors continue to weigh the impact of geopolitical tensions against corporate earnings and commentary. The STOXX600 rose 0.23% led by travel stocks on Tuesday while Germany’s DAX added 0.35%, the French CAC fell 0.32% and, in the UK, the FTSE100 ended the day up 0.21%.
The local market rally ended on Tuesday with the key index falling 0.16% at the closing bell as geopolitical tensions and corporate results weighed on investor sentiment. Tech and banking stocks took the biggest hit yesterday while energy producers ended the day higher on the rising price of oil.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.35% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.12% lower at 75 US dollars and 77 cents a barrel, gold is up 0.37% to 2524 US dollars an ounce and iron ore is trading 0.26% higher at 98 US dollars and 30 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Propel Funeral Partners (ASX:PFP) and has increased its 12-month price target to $6.40. The buy rating is maintained by Bell Potter following the release of FY24 results which saw revenue increase by 24.5% to $209m, supported by 20% growth in funerals conducted and a 4% growth in average revenue per funeral. PFP also recorded an EBITDA of $55.4m at a 26.5% margin which Bell Potter has seen as a healthy outcome, hence the buy rating is maintained.
- Trading Central has identified a bullish signal in Fortescue Limited (ASX:FMG), indicating that the stock price may rise from the close of $18.63, to the range of $20.10-$20.50 on a pattern formed over 21 days, according to the standard principles of technical analysis.
Overnight, Wall St closed mixed as the Dow Jones ended the day at record highs despite the sell-off earlier in the month. The S&P 500 fell 0.32%, the tech-heavy Nasdaq lost 0.85% and the Dow Jones rose by 0.16% by market close.
Over in Europe, markets followed the US and closed mixed as investors react to rising tensions in the Middle East following strikes by both Israel and Hezbollah over the weekend. Germany’s DAX fell 0.09%, the French CAC gained 0.18% and over in the UK the FTSE100 ended Monday’s trading session nearly half a percent higher.
Locally yesterday, the ASX200 rallied 0.76% by market close. Gains were led by the communications services and financial sectors which rose 1.25% and 1.23% respectively. This was offset by the consumer staples sector which fell 0.85%.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.05% by market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.98% higher at 77 US dollars and 5 cents a barrel due to supply concerns following the rising tensions in the middle east.
- Gold is trading 0.28% higher at 2516 US dollars and ounce and iron ore is trading 0.14% lower at 98 US dollars and 5 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Genusplus Group (ASX:GNP) and has increased its 12-month price target to $2.70. The buy rating is maintained by Bell Potter following positive FY24 results in which GNP reported group revenue of $551m, up 24% year-on-year, with the beat driven by better than expected industrial serviced segment sales of $153m. Bell Potter continue to see GNP as a key small-cap investment opportunity to play the theme of increasing investment in renewable energy, battery energy storage and transmission infrastructure across Australia, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal in TPG Telecom (ASX:TPG), indicating that the stock price may rise from the close of $4.65 to the range of $4.81-$4.85, on a pattern formed over 15 days, according to the standard principles of technical analysis.
Wall Street ended Friday’s session higher after Fed Chair Jerome Powell indicated rate cuts are on the horizon at his Jackson Hole Economic Symposium speech on Friday. The Dow Jones added 1.14% on Friday while the S&P500 rose 1.15% and the tech-heavy Nasdaq ended the day up 1.47%. Powell said ‘the time has come for policy to adjust’ which was music to all investor ears after over a year of an aggressively high interest rate strategy to tame inflation in the world’s largest economy.
Friday’s rally in the US boosted the major averages to gains for the week with the Dow adding 1.3%, the S&P500 rising 1.45% and the Nasdaq climbing 1.4%.
Uranium miners in the states rallied on Friday after Kazakhstan’s national uranium miner cut its production output for 2025 due to delays in ramping up production at some sites and limited access to sulfuric acid. This output decline places pressure on the global supply of uranium, which is growing in demand due to the global increase in nuclear power.
Positive rate cut sentiment out of the Fed boosted European markets on Friday as a lower US interest rate weakens the USD and increases the attractiveness of trade with Europe and other export-oriented countries. The STOXX 600 rose 0.5% while Germany’s DAX added 0.76%, the French CAC rose 0.7% and, in the UK, the FTSE100 ended the day up 0.48%.
Across the Asia region on Friday, markets closed mostly lower as investors awaited Fed Chair Jerome Powell’s speech of Jackson Hole on Friday. Japan’s Nikkei rose 0.4% as inflation came in at 2.8%, a flat reading on the prior month, while China’s CSI index rose 0.42%, Hong Kong’s Hang Seng lost 0.14% and South Korea’s Kospi Index lost 0.22%.
Locally on Friday the ASX200 ended the day down just 0.04% as the utilities and energy sectors weighed on market gains. For the week though, the ASX200 rose 0.66% to sit above 8000 points again for the first time since the early August mass-equity sell off.
What to watch today:
- Tech sector heavy weight WiseTech Global led the winning stocks for the week with a 28% climb which paved the foundations for the tech sector to soar over 8% last week. The WTC rally was on the back of strong FY24 results and growth momentum expected to continue into FY25.
- Telix Pharmaceuticals shares fell 9% on Friday despite the radiopharmaceuticals company posting very strong first half results. For the first half, Telix reported total revenue rose 65% to $364m, gross margin increased to 66% from 63%, the company reported NPAT of $29.7m up from a loss of $14.3m and Telix reaffirmed its guidance for FY24.
- Ahead of the first local trading session of the last week for August, the SPI futures are anticipating the ASX to open the day up 0.51% on the back of the Fed’s rate cut outlook boosting global sentiment late last week.
- On the commodities front this morning, oil is trading 2.5% higher at US$74.83/barrel, gold is up 0.9% at US$2509/ounce, and iron ore is down 0.14% at US$98.05/tonne.
- The Aussie dollar has strengthened to buy 67.97 US cents, 98.26 Japanese Yen, 51.21 British Pence and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Bell Potter has maintained a buy rating on Rural Funds Group (ASX:RFF) and has raised the 12-month price target on the agricultural property management company from $2.40 to $2.50 following the release of RFF’s FY24 results. For the last financial year, RFF reported AFFO above Bell Potter’s forecasts, 18% revenue growth and strong operating cash flows. The analysts also noted material improvement in the profitability indicators in recent months including cattle, almond and macadamia prices rallying off lows in recent times, with RFF also having a history of delivering net asset value growth through investment, with the next macadamia pillar.
- Trading Central has identified a bullish signal on Nick Scali (ASX:NCK) following the formati
Reporting Season is in full swing, with 93 companies reporting so far displaying some interesting trends. Retailers like Super Retail Group and Universal Store showcased resilience despite the tough economic conditions, delivering solid FY24 results and strong starts to FY25. Meanwhile the tech sector made waves in the past week with WiseTech Global surging 28% following strong FY24 results.
• (0:54): resilience displayed by Super Retail Group in FY24
• (2:10): Universal’s impressive results despite the high-cost environment of FY24
• (3:46): the strong FY25 outlook for WiseTech Global
• (6:51): how the ASX200 performed this week so far
• (7:24): the most traded stocks & ETFs by Bell Direct clients
• (8:00): economic news to watch out for next week.
The likelihood of a rate cut out of the Fed in September sent Wall Street back into rally mode overnight as investors digested the positive rate outlook in the Fed’s latest FOMC meeting minutes. The S&P 500 rose 0.42% on Wednesday, while the Nasdaq added 0.57%, and the Dow Jones ended the day up 0.14%. Wall Street now awaits further indication of rate cuts out of Fed Chair Jerome
Powell at his Jackson Hole Economic Symposium speech on Friday. US retail giant Target jumped 11% on Wednesday after reporting Q2 earnings that exceeded Wall Street estimates while department store giant Macy’s tumbled 13% after lowering its full year sales forecast.
Over in Europe on Wednesday, markets closed higher on positive sentiment out of the U.S. and ahead of flash PMI figures out for the eurozone on Thursday. The STOXX 600 rose 0.32% on Wednesday, Germany’s DAX added 0.5%, the French CAC gained 0.52%, and, in the UK, the FTSE100 closed the midweek session up 0.12%.
Across the Asia region on Wednesday, markets were mostly lower on weaker-than-expected economic data out in the region. Japan’s Nikkei fell 0.3% after Japan’s trade balance data for July indicated higher exports than imports, imports exceeded expectations and exports fell short of economists’ forecasts. Hong Kong’s Hang Seng fell 0.82% on Wednesday, China’s CSI index lost 0.33% and South Korea’s Kospi index ended the day up 0.17%.
Locally on Wednesday, the ASX200 reversed losses in afternoon trade as a 5% rally for tech stocks and a 1.72% gain among mining stocks offset losses among energy, REIT and financial stocks.
Wisetech global did most of the heavy lifting in the tech-sector’s near 5% rally as the logistics software company soared over 18% on FY24 results including total revenue increasing 15% organically on FY23 to $1.041bn, CargoWise revenue lifting 19% organically to $880.30m, underlying NPAT rising 15% on FY23 to $283.5m, and the final dividend increased 10% to 9.2cps. WiseTech’s results were driven by its recent aggressive acquisition strategy flowing through to improved financial results.
What to watch today:
- Ahead of Thursday’s trading session the SPI futures are anticipating the ASX to open the day up 0.35% tracking global gains overnight.
- Australian property development company Charter Hall also rocketed over 15.5% on Wednesday after releasing stronger-than-expected FY24 results including operating earnings of $358.7, with operating EPS post-tax of 75.8cps, FY24 statutory loss of $222.1m and distributions to the value of 45.1cps. Investors likely rallied around the REIT stocks after it issued guidance for FY25 with the expectation of FY25 EPS to grow to approximately 79cps, with a 6% increase in distributions.
- On the commodities front this morning, oil is trading 1.7% lower at US$71.92/barrel, gold is up just 0.02% at US$2513/ounce, and iron ore is down 0.11% at US$97.99/tonne.
- The Aussie dollar is buying US$0.67 cents, 97.90 Japanese Yen, 51.53 British Pence, and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Cedar Woods (ASX:CWP) from $5.75 to $6.50 and maintain a buy rating on the real estate development company following FY24 results coming in as a strong beat including EPS of 49.2cps which beat Bell Potter expectations by 7.4% and the company guided to NPAT growth of 10% for FY25.
- Trading Central has identified a bullish signal on Hansen Technologies (ASX:HSN) following the formation of a pattern over a period of 54-days which is roughly the same amount of time the share price may rise from the close of $4.68 to the range of $5.15 to $5.25 according to standard principles of technical analysis.
Wall Street’s 8-day winning streak ended overnight as investors took a breather from the comeback rally after the early August mass market sell-off. The Dow Jones fell 0.15% on Tuesday, the S&P500 lost 0.2% and the tech-heavy Nasdaq ended the day down 0.33%. This week, investors are preparing for the Federal Reserve’s annual Jackson Hole Economic Symposium where Fed Chair, Jerome Powell, will speak on Friday. Investors are also likely taking a breather from the recent equities rally ahead of the US Fed’s latest FOMC meeting minutes out on Wednesday US time before assessing their next moves in line with the rate outlook from the Fed at the last rate-decision meeting.
Over in Europe on Tuesday, markets closed lower on Tuesday as economic uncertainty weighed on investor sentiment. The STOXX 600 fell 0.46% with all-but the automotive sector ending the day in the red, while Germany’s DAX lost 0.35% on Tuesday, the French CAC fell 0.22% and, in the UK, the FTSE100 ended the day down 1%. Germany’s producer price index fell 0.8% YoY in July, while inflation in the euro zone was 2.6% in July, up from 2.5% in June with both datasets weighing on investor sentiment on Tuesday.
Across Asia on Tuesday, markets closed mostly higher tracking Wall Street’s strength on Monday and after China’s loan prime rates were held, in-line with expectations. Japan’s Nikkei led the gains with a 1.8% rise, while South Korea’s Kospi index rose 0.83%, and China’s CSI Index added 0.72%, while Hong Kong’s Hang Seng fell 0.5% on Tuesday.
Locally on Tuesday, the ASX200 rose for an 8th straight session on Tuesday, closing the day up 0.2% above 8000 points for the first time since the early-August mass sell-off.
What to watch today:
- The RBA meeting minutes out yesterday revealed the RBA considered raising Australia’s cash rate from the 12-year high 4.35% in August in a bid to return inflation to the target 2-3% range in a more reasonable timeframe. The RBA also didn’t rule out any further rate hikes which saw market gains ease in afternoon trade from the morning rally.
- The hawkish tone out of the RBA meeting minutes weighed on real estate stocks yesterday with the sector posting a 1.55% decline while a tech and materials rally more than offset the weakness among real estate stocks.
- Baby Bunting shares soared 8.85% on Tuesday after the baby retailer released FY24 results. Investors overlooked the decline in sales, profit and increase in net debt to buy into the stock on outlook for improved outlook in FY25 amid cost cutting measures and pro forma NPAT expectations of between $9.5m and $12.5m.
Plumbing supplies giant Reliance Worldwide also rallied just shy of 9% yesterday on the release of FY24 results including net sales growth of 0.2%. Investors bought in also on strong outlook for FY25 in anticipation for this company to form part of the group of entities that will benefit from an easing interest rate environment.
On the commodities front this morning, oil is trading 0.41% lower at US$73.36/barrel, gold is up 0.43% at US$2514/ounce and iron ore is up 0.3% at US$98.10/tonne. - The Aussie dollar has strengthened overnight to buy 67.39 US cents, 98.11 Japanese Yen, 51.79 British Pence and 1 New Zealand dollar and 10 cents.
- Ahead of the midweek trading session on the local bourse, the SPI futures are anticipating the ASX to open the day down 0.55% tracking the global market sell-off overnight.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Mader Group (ASX:MAD) from $7.60 to $6.80 and maintain a buy rating on the leading provider of specialised contract labour for maintenance of heavy mobile equipment in the resources and civil industries, following the release of Mader’s FY24 results. Near-term outlook supported by mid-cycle fleet renewal in Australia and North America, however, the analyst is cautious that chal
Wall St closed higher overnight as the Nasdaq rallies for its 8th straight session. The Dow Jones closed over half a percent higher, the S&P 500 closed 1% in the green and the tech-heavy Nasdaq rallied 1.39% overnight.
Over in Europe, markets closed higher on Monday following the global market rally last week. The STOXX600 ended the trading session 0.64% higher with all sector ending in positive territory. Gains were led by mining and retail stocks, up 1.98% and 1.57% respectively. Germany’s DAX closed over half a percent in the green, the French CAC added 0.7% and over in the UK the FTSE100 gained 0.55%.
Locally yesterday, the ASX200 ended Monday’s trading session 0.12% higher. Gains were led by the utilities and financial sectors which gained 1.67%and 0.82% respectively. This was offset by the consumer staples sector which fell 0.83% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.45% at market open this morning.
- On the commodity front this morning,
- Oil is trading 4.75% lower at 73 US dollars a barrel as ongoing cease-fire talks in Gaza could ease geopolitical tensions, hence reduce the risk premium on oil.
- Gold is trading 0.16% lower at 2503 US dollars an ounce and iron ore is trading 0.75% lower at 97 US dollars and 81 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Adacel Technologies (ASX:ADA) and has a 12-month price target of $0.65. The buy rating is maintained by Bell Potter following the release of results where normalised FY24 EBITDA of $1.1m US dollars was better than Bell Potter’s forecast of $900,000 US dollars and the downgraded guidance given in July. There was a reduction in the earnings forecast which has caused a 13% reduction in the price target, however it is still a 15% premium to the share price, hence the buy rating is maintained.
Wall Street closed higher on Friday to end the best week across the major averages in 2024, posting a major comeback from the mass exodus of equities that started August on a very sour note. The Nasdaq rose 0.21% on Friday and 5.2% for the week, the S&P500 added 0.2% on Friday and 3.9% for the week and the Dow Jones rose 0.24% on Friday and 2.9% for the week. Economic data released late last week was the catalyst for Friday’s rally with retail sales data out on Thursday coming in higher than expected while weekly jobless claims fell for a second week in a row. The mega cap rebound peaked last week with Nvidia gaining 18% over the 5-trading days while Apple and Microsoft rose 4% and 3% respectively for the week.
Over in Europe markets mostly ended the week on a positive note with the STOXX 600 index adding 0.31% on Friday and a record weekly gain of 2.4%. Germany’s DAX rose 0.77% on Friday, the French CAC added 0.35% and, in the UK, the FTSE100 ended the day down 0.43% following the release of UK inflation data showing an uptick to 2.2% in July and retail sales coming in at a rise of 0.5% for July from a 0.9% decline in June.
Across the Asia markets on Friday, Japan’s Nikkei posted its best week in 4-years with a rise of 3.64% on Friday while the index was up 8.67% over the week. South Korea’s Kospi Index rose 1.99% on Friday, Hong Kong’s Hang Seng added 1.81% and China’s CSI index ended the day up 0.11%.
Locally on Friday, the ASX200 rose 1.34% despite RBA governor Michele Bullock saying thinking about rate cuts in Australia is still too premature as the US prepares for rate cuts likely in September. For the week, the ASX200 posted a gain of 2.3% as corporate earnings results this reporting season are broadly in-line with expectations.
A2 Milk shares rose 5% on Friday after the infant formula company settled its dispute with NZ-based dairy processing company Synlait Milk.
Magellan Financial shares also rose 3% on Friday a day after the fund manager released full year results including a 31% jump in statutory net profit after tax and a final dividend declared of 28.6cps.
What to watch today:
- Ahead of the first trading session of the new week the SPI futures are anticipating the ASX to open the day down 0.18%.
- On the commodities front this morning oil is trading down 0.4% at US$76.35/barrel, gold is down 0.15% at US$2504/ounce, and iron ore is trading 0.75% lower at US$97.81/tonne.
- The Aussie dollar has strengthened to buy US$0.67 cents, 98.63 Japanese Yen, 51.53 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Nufarm (ASX:NUF)and maintain a hold rating on the leading producer of ag-chem products globally following a trading update out of the company with softer-than-expected trading in North America and Europe leading to the company downgrading FY24 EBITDA expectations from $350-$390m to $300m-$330m.
- And Trading Central has identified a bullish signal on Australian Clinical Labs (ASX:ACL) following the formation of a pattern over a period of 56-days which is roughly the same amount of time the share price may rise from the close of $2.64 to the range of $3.10 to $3.25 according to standard principles of technical analysis.
Wall St closed higher overnight following the release of positive US inflation data. The Dow Jones closed 0.61% higher, the S&P500 closed in the green for the 5th straight day, up 0.38% and the tech-heavy Nasdaq rose slightly by 0.03%.
US core inflation data which excludes volatile items such as food and energy were released overnight, coming in at 3.2% year-on-year which was 0.1% lower than the forecast and previous result of 3.3%.
Over in Europe, markets closed higher as investors digested key inflation figures coming out of both the US and UK. The STOXX600 closed 0.43% higher overnight with travel and leisure stocks rising 2.89% and mining stocks leading losses, down 0.97%. Germany’s DAX rose 0.41%, the French CAC rallied 0.79% and over in the UK the FTSE100 gained 0.56%.
Key UK inflation data was released overnight, coming in below expectations for July at 2.2%, however this is still above the Bank of England’s target of 2%.
Locally yesterday, the ASX200 closed 0.3% higher by market close. Gains were led by the health and information technology sectors which rose 1.68% and 1.59% respectively. This was offset by the materials sector which saw a loss of 1.87% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.36% at market open this morning.
- On the economic calendar today, Australian unemployment data for July will be released with a consensus and forecast to remain at 4.1%, the same as its previous result.
-
On the commodities front this morning,
- Oil is trading 1.28% lower at 77 US dollars and 35 cents a barrel after the EIA reported an increase in US crude oil inventories that rose by 1.357 million barrels last week.
- Gold is trading 0.66% lower at 2447 US dollars an ounce and iron ore is trading 0.23% lower at 100 US dollars and 44 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Seven Group Holdings (ASX:SVW) and has increased its 12-month price target to $46. The buy rating is maintained by Bell Potter, following the announcement of results by SVW which included an underlying NPAT attributable to owners of $850m, up 30% year-on-year and exceeding Bell Potter’s forecast of $822m. As well as this, SVW’s business and investments are market leaders in their respective industries, with scale, brand and industry expertise underpinning commercial advantages that are hard to replicate by competitors. Bell potter remains positive on the near-term outlooks for mining production, engineering construction and transitional energy markets, hence the buy rating is maintained.
- Trading central has identified a bearish signal on BlueScope Steel (ASX:BSL), indicating that the stock price may fall from the close of $19.84 to the range of $16.80-$17.40 on a pattern formed over 31 days, according to the standard principles of technical analysis.
Wall Street’s rally has extended into another session on Tuesday as equities move closer to July’s record following the release of PPI inflation data and ahead of the inflation reading out tonight. The Dow Jones rose 1.04%, the S&P500 added 1.68% higher and the tech-heavy Nasdaq ended the day up 2.43%. The US producer price index increased 0.1% in July which fell short of economists’ expectations and further indicates inflation in the US is easing.
The US inflation reading out tonight is expected to rise just slightly on last month but remain steady at 3% YoY. If the reading comes in below economists’ expectations’, we will likely see equities rally on Wall Street on Wednesday as the two inflation related readings easing will boost investor sentiment of a soft landing over a recession.
Across the European markets overnight, markets closed higher in the region as investors assessed the latest batch of economic data out in the region. The STOXX 600 rose 0.5% led by gains among healthcare stocks, while Germany’s DAX added 0.48%, the French CAC rose 0.35% and, in the UK, the FTSE100 ended Tuesday’s session up 0.3%. UK wage data out overnight showed pay excluding bonuses grew by 5.4% YoY between April and June which is the lowest rate in two years.
The UK unemployment rate also fell to 4.2% from 4.4% which fell short of economists’ expectations indicating strength in the UK economy as inflation continues to ease.
Across the Asia markets on Tuesday, it was a mostly green finish led by Japan’s Nikkei rising 3.45% after Japan’s Producer Price Index rose 3% in July from the prior year. South Korea’s Kospi Index rose just 0.12% on Tuesday, Hong Kong’s Hang Seng gained 0.32% and China’s CSI index ticked 0.26% higher.
The local market rallied 0.17% yesterday despite a near 3% decline in healthcare stocks weighing on market gains as healthcare heavyweight CSL declined on disappointing outlook for FY25.
Economic data out yesterday also added to market gains yesterday as wage growth steadied in Q2 which has been a key driver of inflation remaining high, while Westpac consumer confidence data also rose 2.8% to 85 points in August from 82.7 points in July indicating consumer sentiment is slightly improving but remains weaker than historical levels.
NAB Business confidence data also out yesterday continued its downward trajectory though in July with a reading of 1 index point, down from 3 index points in June, indicating Australian businesses remain pessimistic about the current state of the market, however, the ease in wages growth and slowing inflation drivers pave the way for a recovery in business confidence over the second half of CY24.
Temple & Webster shares shot the lights out yesterday with a 26% rise on the back of stellar FY24 results being released including record revenue of $498m and a strong start to FY25.
James Hardie Industries came under pressure yesterday following release of a Q1 FY25 trading update. Despite posting net sales up 4% to $992m, investors sold out on the outlook of weakening demand and easing volumes in the company’s key North American operations.
What to watch today:
- Ahead of the midweek session on the ASX the SPI futures are anticipating the local market to open the day up a sharp 0.73% on the global rally overnight.
- On the commodities front this morning, oil is trading 2.1% lower at US$78.38/barrel, gold is down 0.4% at US$2466/ounce and iron ore is down 0.6% at US$100.67/tonne.
AU$1.00 is buying US$0.66, 97.35 Japanese Yen, 51.28 British Pence and NZ$1.09 cents.
Trading Ideas:
- Bell Potter has maintained a hold rating on Temple & Webster but have raised the 12-month price target on the leading online furniture retailer from $11.40 to $12.20 following the release of the company’s FY24 results yesterday. Bell Potter’s analyst says the price target increase was driven by
Wall St closed mixed overnight as investors await key inflation data, set to be released on Wednesday. The Dow Jones closed 0.36% lower, the S&P 500 closed flat overnight and the tech-heavy Nasdaq saw a rise of 0.21%.
Over in Europe, markets closed mixed as investors await inflation data to come out from both the US and the UK. The STOXX600 closed flat overnight with travel and leisure stocks falling 0.8%. This was offset by oil and gas stocks which gained 0.6% after OPEC trimmed its 2024 global oil demand growth forecast. Germany’s DAX had a small gain of 0.02%, the French CAC fell 0.25% and over in the UK the FTSE100 rallied over half a percent.
Locally yesterday, the ASX200 rose 0.46% by market close. Gains were led by the information technology and consumer discretionary sectors which rose by 1.93% and 1.91% respectively. This was offset by the materials sector which fell over half a percent by the closing bell.
What to watch today:
- The SPI futures are suggesting that the Australian share market will open flat at the open this morning.
-
On the commodities front this morning,
- Oil is up 3.84% to 79 US dollars and 78 cents a barrel following the escalating conflict in the middle east which is threatening tighter global oil supplies. As well as this, OPEC have reduced its 2024 global oil demand forecast to 2.11 million barrels per day from 2.25 million barrels.
- Gold is trading 1.71% higher at 2472 US dollars an ounce and iron ore is trading half a percent higher at 101 US dollars and 26 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Beach Energy (ASX:BPT) and has a 12-month price target of $1.40. The buy rating is maintained by Bell Potter as the capex is now trending lower and production growth will see free cash flow lift from FY26. BPT’s near-term production growth is a key differentiator when compared with domestic peers. With a positive view on Australian east coast gas and LNG markets, and a strong production and earnings growth outlook, the buy rating is maintained.
Wall Street continued its recovery-rally on Friday to close higher across the three key averages as weaker-than-expected initial jobless claims data out on Thursday boosted investor hopes that the U.S. will avoid recession in favour of a soft landing. The Dow jones rose 0.13% on Friday, the S&P500 added 0.47% and the tech-heavy Nasdaq ended the day up 0.51%.
Over in Europe, markets closed higher in the region taking lead from the global market recovery from Monday’s sharp sell-off. The STOXX 600 rose 0.57% on Friday, Germany’s DAX added 0.24%, the French CAC rallied 0.31%, and, in the UK, the FTSE100 ended the day up 0.28%.
Across the Asia markets on Friday the global sea of green extended across Asia’s markets as investors assessed China’s CPI and PPI data and bought back into stocks broadly after the early week mass sell-off. Japan’s Nikkei added 0.56% on Friday, China’s CSI index slid 0.34%, and Hong Kong’s Hang Seng rallied 1.17%.
China’s CPI came in at a rise of 0.5% which well exceeded economists’ forecasts of a 0.3% rise indicating the highest reading since February indicating improved domestic demand in the world’s second largest economy.
While the inflation reading rising is a positive sign, it is just one move in the right direction, and much more is needed to be done to see a proper correction in the economic health of China. This week we also had Chinese trade balance data out that indicated imports exceeded exports which depleted the trade surplus in the country more than economists’ were expecting, and PPI data out on Friday that fell 0.8% from a year ago, indicating a mixed recovery picture in the region.
What to watch today:
- Locally on Friday the ASX200 ended the day in positive territory, with a modest gain of 1.25%, led by the tech sector rising over 3%, driven by Life360 soaring 18% after upgrading full year revenue guidance and announced global expansion plans.
- QBE Insurance fell almost 2% on Friday following the release of the company’s FY24 results. Despite the company posting a strong gain in earnings, investors were more focused on the small miss in net profit and guidance than analysts’ were expecting.
- On the commodities front this morning, oil is trading 0.15% higher at US$76.98/barrel, gold is down just a slight 0.09% at US$2428/ounce and iron ore is up 0.51% at US$101.26/tonne.
- The Aussie dollar has strengthened over the weekend, with 1 Aussie dollar is buying 65.7 US cents, 96.55 Japanese Yen, 51.34 British Pence and 1 New Zealand dollar and 10 cents.
- Ahead of Monday’s trading session on the ASX the SPI futures are anticipating the market to open the day up 0.76%.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Life360 (ASX:360) from $19/share to $20.50/share and maintain a buy rating on the location tracking software company following the release of the company’s 2Q24 trading update outlining a beat on revenue expectation, a beat in total paying circles and the company upgraded its guidance for both revenue and EBITDA for FY24.
- Trading Central has identified a bullish signal on SRG Global (ASX:SRG) following the formation of a pattern over a period of 74-days which is roughly the same amount of time the share price may rise from the close of $0.88 to the range of $1.01 to $1.03 according to standard principles of technical analysis.
Reporting season if off to a rock start. While only a handful of ASX-listed companies have unveiled their FY24 results, a clear trend of rising costs and a gloomy outlook for the coming year is already emerging. Discover which companies are weathering the storm and which are facing headwinds.
In this week’s wrap, Grady covers:
- (0:37): what happened to Transurban this week
- (1:39): why retailers are facing headwinds
- (2:52): what to expect from Mirvac Group
- (5:24): the most traded stocks & ETFs by Bell Direct clients
- (5:50): economic data to watch out for.
Wall St closed higher overnight after new labour market data boosted investors confidence following a sell-off earlier in the week. The Dow Jones rose 1.76%, the S&P 500 had its best day since 2022, rising 2.3% and the tech-heavy Nasdaq gained 2.87%.
US jobless claims data was released overnight, coming in below its previous result of 250k to 233k, taking some pressure of concerns on the strength of the labour market.
Over in Europe, markets closed mixed as they reacted to the boosted sentiment over in the US. The STOXX600 closed 0.2% higher with sectors staying in mixed territory. Media and chemicals stocks dropped by 0.6%, while travel stocks jumped 1.28% overnight. Germany’s DAX rose 0.37%, while the French CAC fell 0.26% and over in the UK the FTSE100 also fell 0.27%.
Locally yesterday, the ASX200 closed 0.23% lower with half of the sectors closing lower. Losses were led by the real estate and materials sectors which fell 1.89% and 1.82% respectively. This was offset by the financial sector which gained just over 1% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 1.06% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.92% higher at 75 US dollars and 92 cents a barrel, following the release of positive US jobs data.
- Gold is trading 1.74% higher at 2426 US dollars an ounce and iron ore is trading 1.12% lower at 101 Us dollars and 71 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Coronado Global Resources (ASX:CRN) and has a 12-month price target of $1.85. The buy rating is maintained by Bell Potter as CRN’s production and cost profile has reached a turning point, following substantial self-funded investment across its Australian and US operations over the past two years. The company should generate improved free cash flow and shareholder returns going forward, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on AGL Energy (ASX:AGL), indicating that the stock price may rise from the close of $10.75 to the range of $11.23-$11.33, on a pattern formed over 25 days, according to the standard principles of technical analysis.
Wall Street’s rollercoaster week extended into the midweek session as stocks went from a rally on Tuesday to a sea of red again on Wednesday as investor fears of recession drive investor sentiment in the current market conditions. The Dow Jones fell 0.6% on Wednesday, the S&P500 dropped 0.77% and the tech-heavy Nasdaq ended the day down 1.05%. Super Micro Computer shares tanked 20.1% after the server company missed Q4 earnings estimates, while Shopify soared over 22% after the e-commerce giant beat expectations for Q2.
Over in Europe markets closed higher on Wednesday in the best performance for the region for more than 9-months. The STOXX600 rose 1.56%, Germany’s DAX climbed 1.47%, the French CAC added 1.9% and, in the UK, the FTSE100 ended the session up 1.75%.
Puma shares tumbled over 11% on Wednesday after the sportswear company released Q2 earnings and reduced its EBIT forecast fore the full year.
The Asia markets extended gains in the region on Wednesday as Japan’s Nikkei continued its recovery with a 1.2% rise, while Hong Kong’s Hang Seng added 1.3%, while China’s CSI index ended the day flat.
China’s trade balance data out yesterday indicated a stagnated recovery in the region’s trade for July with imports rising 7.2% in July, while exports rose 7% which missed expectations.
Locally on Wednesday, investors took confidence from Wall Street’s recovery on Tuesday into our local midweek session resulting in the key benchmark ending the day up 0.25% as all but two sectors ended the day in positive territory. Investors are focused on corporate earnings and rate outlook, with subdued trading volumes locally indicating investors sit nervously on the sidelines assessing economic outlook and the rate cut forecasts.
Arcadium Lithium was the best performer on the ASX200 yesterday after the company announced it will suspend or delay a number of its projects in Argentina and Canada amid the persistently depressed lithium spodumene prices.
GQG Partners shares rose 3.3% yesterday after the fund manager reported funds under management increased almost 0.5% MoM to US$156.3bn as of the end of July, implying net inflows of US$13.9bn for the year to date to July 31.
What to watch today:
- Ahead of Thursday’s trading session on the ASX, the SPI futures are anticipating the local market to open the day down 0.43%, taking lead from Wall Street’s turbulence overnight.
- On the commodities front this morning, oil is trading 3.13% higher at US$75.48/barrel, gold is flat at US$2383/ounce, and iron ore is down 1.27% at US$102.86/tonne.
- AU$1.00 is buying US$0.65, 95.51 Japanese Yen, 51.52 British Pence and NZ$1.09.
Trading Idea:
- Bell Potter has decreased the 12-month price target on Neuren Pharmaceuticals (ASX:NEU) from $28 to $25 but maintain a buy rating on the biotech company developing drugs and treatments for key neurodevelopmental disorders, following the release of the company’s Q2 results including Daybue sales rising 11% QoQ to US$84.6m and treatment persistency continuing to track towards 50% long-term. The decrease in the price target by Bell Potter’s analyst was due to the company’s distribution partner, Acadia, decreasing the CY24 sales guidance of Neuren’s Daybue drug to US$340-US$370m from US$370m to US$420m.
Over in the US on Tuesday the steep sell-off of the previous three sessions took a pause with stocks recovering some losses, as investors took a pause from the recession-fear-driven pull-back. The Dow Jones rose 0.76% on Tuesday, the S&P500 rose 1.04% and the tech-heavy Nasdaq ended the day up 1.03%. US investors began the US Market correction last Friday after US jobs data came in weaker-than-expected, which sparked the broad market tumble for 3 sessions amid rising recession fears. The rally on Tuesday has identified key areas of the market that still have growth potential including small-caps and rate-sensitive groups.
Across European markets overnight, markets in the region joined the global market rebound on Tuesday to close mostly higher in Europe. The STOXX 600 rose 0.2% on Tuesday, Germany’s DAX added 0.09%, the French CAC declined 0.27%, and, in the UK, the FTSE100 ended the day up 0.23%.
In the Asia region on Tuesday, Japan’s Nikkei recovered from its worst session since the Black Monday crash of 1987 on Monday, to close up 10.23% on Tuesday as heavyweight stocks in the region including Softbank Group Corp and Mitsui rose 12.06% and 10.43% respectively. Japan’s markets have been sliding of late since the Bank of Japan raised rates to their highest level since 2008 on July 30, causing the yen to strengthen which placed pressure on equities.
What to watch today:
- The local market tanked over 3% on Monday before recovering to close 0.41% higher on Tuesday, taking no-lead from Wall Street’s worst session in years on Monday night. Local investors yesterday were more focused on the RBA’s rate decision and key corporate earnings results to provide outlook for FY25.
- The RBA maintained the nation’s cash rate at a 12-year high 4.35% for yet another period as was widely expected as key inflation drivers remain stubbornly sticky including housing inflation, food and non-alcoholic beverages, and clothing and footwear, in addition to services, and wages inflation driving up the nation’s inflation rate to 3.8% in the June quarter.
- RBA governor Michele Bullock said yesterday ‘a rate cut is not on the agenda in the near term’ as inflation remains sticky above the 2-3% target range and that the RBA actually considered a raise for August’s meeting before deciding to hold at the current rate. Ms Bullock also pointed out the impacts of sticky overseas inflation and locally, the need to see demand and supply coming back into better balance.
- On a corporate earnings front, Audinate tanked 36% yesterday after releasing strong FY24 results alongside the outlook for headwinds set to impact earnings in FY25. Investors were more concerned about the outlook of earnings depreciation than the strong results in FY24.
- Coronado Global Resources shares fell 1.3% on Tuesday after the leading coal producer reported 1H NPAT fell 92% on PCP, while EBITDA tumbled 62% YoY and revenue fell 10% on the PCP. CRN retained CY24 guidance on volumes, cost and CAPEX and attributed the performance dip on lower coal prices and lower sales.
- On the commodities front this morning oil is trading 0.5% higher at US$73.03/barrel, gold is down 0.4% at US$2395/ounce and iron ore is up 0.17% at US$104.18/tonne.
- The Aussie dollar is buying 65.15 US cents, 94.93 Japanese Yen, 51.02 British Pence and 1 New Zealand dollar and 10 cents.
- Ahead of the midweek trading session on the ASX the SPI futures are anticipating the ASX to open the day down 0.25%.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Lotus Resources (ASX:LOT) and maintain a speculative buy rating on the uranium-focused miner with projects in Africa following the company’s announcement that it has signed the Mine Development Agreement with the Malawi Government for the restart of the Kayelekera (Kay-el-e-kera) Uranium Mine (KM). Bell Potter’s analyst sees posit
A weaker-than-expected jobs report out in the US on Friday sparked a broad sell-off to end the week on Wall Street as recession fears continue to rise. The Dow Jones fell 1.51% on Friday, the S&P500 lost 1.84% and the tech-heavy Nasdaq tumbled 2.43%. The unemployment rate in the US rose to the highest level since October 2021 in July to a rate of 4.3%, while nonfarm payrolls grew by just 114,000 last month. The bond market was flooded on Friday as investors seek out safe-haven assets, which saw the US 10-year Treasury Yield fall to its lowest level since December.
Second quarter results out of Amazon led to a sell-off in the tech giant after the company missed expectations and issued a disappointing forecast which signals easing growth in the AI and tech space.
Intel also tanked 26% after announcing weak guidance and widespread layoffs.
Over in Europe, the global sell-off on Friday extended into the region with the STOXX 600 ended the day down 2.82% led by financial services and banking stocks falling 5.22% and 4.35% respectively. Germany’s DAX ended Friday’s session down 2.33%, the French CAC fell 1.61% on Friday and, in the UK, the FTSE100 closed out the week with a loss of 1.31%. The fall in the FTSE100 came despite the Bank of England cutting interest rates for the first time since December 2020 on Thursday last week.
Across Asia on Friday, it was a sea of red led by Japan’s Nikkei tumbling 5.81% marking its worst session since March 2020 as Daiwa Securities tumbled 18.85%. Hong Kong’s Hang Seng ended Friday’s session down 2.32%, South Korea’s Kospi index fell 3.65% as inflation data came in higher than expected for July, and China’s CSI index ended the day down 1.02%.
Locally on Friday, the ASX200 fell 2.11% in its worst day since March 2023, retreating from the all-time high reached on Thursday. For the week though the ASX200 notched a slight 0.28% gain as communications services stocks did most of the heavy lifting with a 2.14% rise. Retailers took the biggest hit on Friday as investors assessed weakening economic conditions at home and overseas, with Wesfarmers falling 2.9%, and Premier Investments ending the day down 2.2%. Block Inc was a rare winner on Friday with a rise of 5.1% after the company flagged a new US$3bn share buyback and upgraded its full-year guidance.
What to watch today:
- Ahead of Monday’s session on the ASX the SPI futures are anticipating the market to open Monday’s session down by a large 1.46%.
- On the commodities front this morning oil is trading 3.66% lower at US$73.52/barrel, gold is down 0.12% at US$2442/ounce and iron ore is up 1.14% at US$104/tonne.
- AU$1.00 is buying US$0.65, 96.32 Japanese Yen 50.82 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has significantly increased the 12-month price target on Clarity Pharmaceuticals (ASX:CU6) from $4 to $10 and maintain a speculative buy rating on the cancer imaging and therapy treatment development company following the release of a Q4 cashflow statement and quarterly activities report out of the company. Gross cash burn was around $14m, net cash burn was inclusive of $10m in R&D credit was around $4m, and Bell Potter’s analyst estimates the cash runway extends deep into CY26. The company continues to focus on two trials in prostate cancer which continue to show outstanding safety with good indications of efficacy.
- And Trading Central has identified a bearish signal on Mirvac Group (ASX:MGR) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may fall from the close of $2.10 to the range of $1.71 to $1.79 according to standard principles of technical analysis.
And that’s all for this Monday, be sure to look out for FY24 results out of Cettire, AGL Energy and Arcadium Lithium out tomorrow.
Australia’s corporate landscape is facing a perfect storm. Rising costs, fierce competition, and softening economic conditions are putting pressure on companies across the board. The upcoming earnings season will reveal the full extent of these challenges. Discover the key trends and potential investment opportunities in this week’s video.
In this week’s wrap, Sophia covers:
- (0:11): how economic headwinds are impacting corporate profits
- (0:41): why the market’s attention is shifting towards FY25
- (1:32): why sector performance is expected to diverge
- (2:10): how the ASX200 performed this week so far
- (3:13): the most traded stocks & ETFs by Bell Direct clients
- (3:43): economic news to watch out for next week.
Wall St soared overnight as the Federal Reserve kept interest rates unchanged, while hinting at possible cuts in September. The Dow Jones rose 0.24%, the S&P500 had its best day since February, rising 1.58% and the tech-heavy Nasdaq gained 2.64%.
In terms of US stocks, tech giants made a big comeback, led by Nvidia which rallied 12.8% overnight. Other stocks including Apple, Meta Platforms and Amazon also finished Wednesday’s trading session higher.
Over in Europe, markets closed higher after the euro zone inflation rose unexpectedly. The STOXX600 closed 0.79% higher, led by tech stocks which gained 2.62%. Germany’s DAX rose over half a percent, the French CAC closed 0.76% higher and over in the UK the FTSE100 ended 1.13% in the green by the closing bell.
Locally yesterday, the ASX200 closed Wednesday’s trading session 1.75% higher with all sectors finishing in positive territory. Gains led by the information technology and energy sectors which rose 2.52% and 2.47% respectively.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.21% by market open this morning.
-
On the commodities front this morning,
- Oil is trading up 5.23% at US$78.64/barrel as fears of supply disruptions increase following further tensions in the Middle East.
- Gold is trading 1.55% in the green at US$2447/ounce and iron ore is trading 0.32% lower at US$106.25/tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Frontier Digital Venture (ASX:FDV) and has a 12-month price target of $0.74. The speculative buy rating is maintained by Bell Potter as FDV has several significant growth levers within its portfolio and platforms coming out of a CY23 focused on cash flows and margins. There is a favourable view of FDV’s strategy of targeting underpenetrated emerging markets with marketplace platforms and FDV emerging profitable with a positive EBITDA and operating cash flows has helped maintained Bell Potter’s speculative buy rating.
- And Trading Central has identified a bullish signal in Nickel Industries (ASX:NIC), indicating that the stock price may rise from the close of $0.85 to the range of $1.11-$1.17, on a pattern formed over 51 days, according to the standard principles of technical analysis.
Wall St closed mixed overnight as investors dropped some big name tech stocks before earnings reports are released. The Dow Jones gained half a percent, the S&P500 fell half a percent and the tech-heavy Nasdaq fell 1.28%.
Investors pulled out of some big-name tech stocks overnight including Nvidia which dropped 7%, while Microsoft fell nearly a percent. Other stocks to decline overnight include Amazon, Netiflix and Meta Platforms.
Early tomorrow morning, the US Federal Reserve interest rate decision will be announced which has a consensus and forecast to be maintained at its current rate of 5.5%
Over in Europe, markets closed higher as earnings seasons reports continue to be released. The STOXX600 rose 0.53% overnight with the majority of sectors closing Tuesday’s trading session in the green. Gains were led by construction and materials stocks which added 1.37%, whilst mining stocks fell 1.22%. Germany’s DAX rose 0.49%, the French CAC gained 0.42% and over in the UK, the FTSE100 fell 0.22% by the closing bell.
Locally yesterday, the ASX200 closed 0.46% lower with most sectors closing in the red. Losses were led by the materials and information technology sectors which fell 1.93% and 0.9% respectively. This was slightly offset by the consumer discretionary sector which rose by 0.22% by the end of the trading session.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.37% at market open this morning.
- In terms of economic data today, CPI indicator data will be released at 11:30 this morning with a forecast of 3.9%, with its previous result having been at 4%.
-
On the commodities front this morning,
- Oil is trading 0.78% lower at US$75.22/barrel as demand lowers from top consumers such as China.
- Gold is trading 1.25% higher at US$2410/ounce and iron ore is trading 0.25% lower at US$106.59/tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on RMA Global (ASX:RMY) and has a 12-month price target of $0.10. The buy rating is maintained by Bell Potter as the key driver for shareholder value in RMY remains the US market, where a decline in interest rates could potentially drive an uplift for house sales and as a result increase activity on RMY’s platform and subscriptions. The recommendation and valuation is based on penetrating the large US market which presents a significant opportunity, hence the speculative buy rating is maintained.
- And Trading Central has identified a bearish signal on Arena REIT (ASX:ARF), indicating that the stock price may fall from the close of $3.77 to the range of $3.49-$3.55, on a pattern formed over 28 days, according to the standard principles of technical analysis.
Wall St closed mixed to start the trading week as investors prepare for the start of earnings season. The Dow Jones closed 0.12% lower overnight, the S&P500 gained 0.08% and the tech-heavy Nasdaq ended Monday’s trading session 0.07% higher.
Over in Europe, markets closed lower as investors look ahead to European Central Bank meetings later this week. The STOXX600 closed 0.18% lower with the majority of sectors trading in the red. This was led by autos which fell 1.35%, whilst healthcare stocks rose 0.66%. Germany’s DAX fell over half a percent, the French CAC lost nearly 1% and over in the UK the FTSE100 gained 0.08% by the closing bell.
Locally yesterday, the ASX200 closed 0.86% higher with all sectors closing in the green. Gains were led by the information technology and communication services sectors which rose 1.53% and 1.4% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.69% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 1.62% lower at US$75.91/barrel, gold is trading 0.12% lower at US$2383/ounce and iron ore is trading 0.26% lower at US$106.86/tonne.
Trading Idea:
- Bell Potter maintains a buy rating on Burgundy Diamond Mines (ASX:BDM) and has a 12-month price target of $0.28. The buy rating is maintained by Bell Potter as they expect positive news flow over the second half of 2024 as BDM report on mine life extension activities and continue to optimise existing operations. As well as this, their Ekati diamond mine is a highly strategic asset within the luxury goods value chain, hence the buy rating is maintained.
A week of mixed sentiment ended with a soaring rally on Friday as investors digested fresh inflation data out in the U.S. The Dow Jones rallied 1.64%, the S&P500 climbed 1.1% and the tech-heavy Nasdaq ended the day up 1.03%. The Fed’s preferred measure of inflation, the personal consumption expenditures price index rose 0.1% on a monthly basis in June and 2.5% yearly, with both readings falling in line with economists’ expectations. This data comes as GDP growth rate data for the US out last Thursday came in at a growth of 2.8% in Q2 which was stronger than economists were expecting, indicating the world’s largest economy continues to grow whilst taming inflation.
Over in Europe markets closed higher on Friday as the global market sell-off eased. The STOXX600 rose 0.9%, Germany’s DAX added 0.65%, the French CAC rose 1.22%, and, in the UK, the FTSE 100 ended the day up 1.21%.
Across the Asia markets on Friday it was a mostly green end to a volatile week, despite Japan’s Nikkei closing lower for an 8th straight session as Tokyo’s headline inflation slowed slightly to 2.2% in July and corporate earnings weighed on investor sentiment in the region as Nissan fell 3.88% after reporting disappointing results for Q1. Hong Kong’s Hang Seng rose 0.34% on Friday, China’s CSI Index added 0.29% and South Korea’s Kospi index ended the day up 0.78%.
Locally on Friday the ASX200 rose 0.76% led by the materials sector jumping 1.42% while every other sector aside from staples stocks ended the day in the green.
Mineral Resources jumped 3.5% on Friday after the mining services and production giant said it was on track to achieve its output guidance for FY24.
Bellevue Gold tumbled 21% on Friday after the gold producer tracking the easing price of gold on Friday and after the company announced it has received firm commitments for a $150m fully underwritten institutional placement with plans to use the proceeds for paying down debt, unlocking free cash flow and to support accelerated exploration and growth.
What to watch today:
- Ahead of the first trading session of the last trading week of July, the SPI futures are anticipating the ASX to open the day up 0.76% on the back of Wall Steet’s rally on Friday.
- On the commodities front this morning oil is trading 0.27% higher at US$77.38/barrel, gold is up 0.38% at US$2395/ounce and iron ore is down 0.26% at US$106.86/tonne.
- AU$1.00 is buying US$0.65, 100.87 Japanese Yen, 50.88 British Pence and NZ$1.11.
Trading Idea:
- Bell potter has increased the 12-month price target on Polynovo (ASX:PNV) from $2.05 to $2.52 and maintain a hold rating on the healthcare company amid long-term growth opportunities for the company. Numerous factors have contributed to the re-rating over recent months including execution on the sales roll out in the US being flawless, while each of the peers have endured a period of faltering growth resulting in adverse valuation adjustments. FY25 revenues are expected to increase by around $35m being a similar quantum increase in FY24 with the net result being ROE and return on cash invested capital beginning to look very attractive leading to the price target increase according to Bell Potter’s analyst. The analyst said a reasonable amount of growth is already priced in hence the hold rating.
The upcoming report season will provide valuable insights into how ASX-listed companies fared over the financial year. As companies unveil their FY24 results, investors will be keen to assess their performance against a backdrop of rising interest rates, persistent inflation, and a slowing Chinese economy.
This video explores key trends, sector outlooks, and potential market movers.
In this week’s wrap, Grady covers:
- (0:11): the economic impact on company earnings
- (1:11): why all eyes are on large-cap stocks
- (2:09): an analysis on sector performance & top stock picks
- (3:35): how the ASX200 performed this week so far
- (4:41): the most traded stocks & ETFs by Bell Direct clients
- (5:09): economic news items to watch out for.
Wall St closed lower overnight as the Nasdaq continued it’s losses from the previous trading session. The Dow Jones rose 0.2%, the S&P500 fell over half a percent and the tech-heavy Nasdaq dropped 0.93%.
US GDP data was released overnight at 2.8% quarter on quarter, 0.3% higher than the forecast of 2.5%
In terms of US stocks, investors moved away from some big AI names including Nvidia which fell 1.7%, Microsoft that lost 2.5% and Alphabet which declined by more than 3%.
Over in Europe, markets closed lower following the sell-off in Wall Street with the STOXX600 ending Thursday trading session 0.72% lower. Germany’s DAX fell 0.48%, the French CAC slid 1.15% and over in the UK the FTSE100 gained 0.4% by market close.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.42% at market open this morning.
-
On the commodities front this morning,
- Oil is trading over 1% higher at 78 US dollars and 38 cents a barrel following stronger than expected US economic growth and a decline in crude inventories.
- Gold is trading 1.43% lower at 2364 US dollars an ounce and iron ore is trading 0.3% lower at 107 US dollars and 47 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on MedAdvisor (ASX:MDR) and has a 12-month price target of $0.64. The buy rating is maintained by Bell Potter following another strong quarter of topline growth in the US, Australia and New Zealand, while gross margins also improved. Q4 revenue was up 32% on the previous corresponding period with full-year revenue up 25%, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Spark New Zealand (ASX:SPK), indicating that the stock price may fall from the close of $3.73 to the range of $3.54-$3.58, on a pattern formed over 40 days according to the standard principles of technical analysis.
Wall Street crumbled on Wednesday as underwhelming results out of two of the tech mega caps weighed on investor sentiment around valuations at the current levels. The Dow Jones fell 1.25% on Wednesday while the Nasdaq and S&P500 had their worst sessions since 2022 with each indices tumbling 2.31% and 3.64% respectively. Shares in Google parent company, Alphabet, fell 5% despite the tech giant beating on the top and bottom-line expectations for Q2. Investors may have sold out of Alphabet after YouTube advertising revenue came in below expectations.
Tesla shares tanked 12.3% for the EV giant’s worst session since 2020 on weaker-than-expected results and a 7% YoY decline in auto revenue as appetite for EVs continues to decline globally.
Across the European markets overnight, markets also closed in the red as investors digested the latest release of corporate earnings results. The STOXX 600 fell 0.6%, Germany’s DAX lost 0.92%, the French CAC declined 1.12% and, in the UK, the FTSE100 ended Wednesday’s session down 0.17%. Deutsche Bank shares fell over 8% on Wednesday after the bank snapped a 15-quarter profit streak in the latest quarter, while LVMH shares fell 4.7% on Wednesday after the luxury fashion house missed second quarter revenue expectations.
Markets across Asia closed lower on Wednesday tracking the global market sell-off, with Hong Kong’s Hang Seng falling 1.1% while China’s CSI declined 0.63% and Japan’s Nikkei ended the day down 1.11%
The local market eased on Wednesday to post a 0.1% loss tracking Wall Street’s negative close on Tuesday and as local energy and REIT stocks weighed on the key index during the midweek session.
Australia’s Judo flash manufacturing PMI data out yesterday indicated a slight growth in manufacturing PMI for July from 47.2 points in June to 47.4 points in July which beat economists’ expectations of a dip to 47 points as input costs increased at a softer pace than average while selling prices rose slightly. Australia’s Judo flash services PMI business activity index data was also out yesterday and came in at a decline to 50.8 points in July from 51.2 points in June, which fell short of economists’ expectations of a slight decline to 50.9 points. The services PMI reading fell in July as the sector faced a renewed decline in orders amid decreased client demand and a drop in international business in 2024.
What to watch today:
- Ahead of Thursday’s trading session, the SPI futures are anticipating the ASX to open the day down 0.95% tracking the global market sell-off overnight.
- On the commodities front this morning, oil is trading 0.02% higher at US$77.455/barrel, gold is down 0.52% at US$2395/ounce and iron ore is down 0.27% at US$108.16/tonne.
- The Aussie dollar has further weakened overnight to buy US$0.65 cents, 101.18 Japanese yen, 51.88 British pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the rating on Pantoro (ASX:PNR) from a hold to a buy and maintain a 10cps 12-month price target on the West Australian gold production and development company following the release of the company’s June quarter report which included a second consecutive quarter of record production for the Norseman Gold Project. Bell Potter’s analyst sees recent share price depreciation, Pantoro’s unhedged gold leverage to the rising gold price, and production growth in FY25 as reasons for the upgrade to a buy.
- And Trading Central has identified a bearish signal on Lendlease (ASX:LLC) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may fall from the close of $6 to the range of $5.15 to $5.30 according to standard principles of technical analysis.
Wall Street closed lower on Tuesday as a morning rally eased in the last hour of trade to see the key indices post slight losses as investors continue to assess second quarter earnings reports. 2 of the magnificent 7, Tesla and Alphabet, released results after the closing bell on Tuesday with Alphabet reporting better-than-expected results while Tesla saw its profit tumble 45% on easing EV demand. Investors are digesting the combination of results, economic data and US political developments at present which is likely to continue driving investor moves for some time to come.
UPS shares fell 12% on Tuesday after the global shipping and logistics service provider released results that fell short of expectations on both the top and bottom lines, while General Motors beat expectations for Q2, however, shares in the automaking giant declined 6.4% on Tuesday as the company delayed plans for its electric and autonomous vehicles.
Investors grew wary of tech valuations late last week, prompting a mass sell-off in the high growth sector, in favour of opportunities in the small cap space.
In Europe overnight, markets closed mixed as investors continued assessing earnings reports from companies across the region. The STOXX 600 rose 0.13%, while Germany’s DAX added 0.8%, the French CAC fell 0.31% and, in the UK, the FTSE100 ended the day down 0.38%.
Across the Asia markets on Tuesday is was a mixed session with Japan’s Nikkei adding 0.3% while Hong Kong’s Hang Seng fell 0.94%, and China’s CSI index fell 2.14%.
Locally on Tuesday, the ASX has had a positive start to the week as investors looked for opportunities in the small cap space while also buying back into the AI-driven tech sector. Locally on Tuesday the ASX200 rose 0.5% driven by the tech, healthcare, industrials and consumer discretionary sectors posting gains over 1% while energy stocks tumbled 2% on the sliding price of key commodities.
Woodside shares slipped on Tuesday after the mining giant released second quarter results including quarterly production down 1% on Q1 due to planned maintenance activities, weather impacts and unplanned outages at Wheatstone and Julimar. Quarterly revenue rose 2% on Q1 though to $3.033bn, and Woodside maintained full year guidance. Investors may have been hitting the sell button yesterday after Woodside increased total estimated costs of the Scarborough Energy project by 4% to US$12.5bn.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open Wednesday’s session up 0.14% extending on yesterday’s rally ahead of the release of Judo Bank Manufacturing and Services PMI flash data for July out this morning.
- On the commodities front this morning, oil is trading 1.53% lower at US$77.20/barrel, gold is up 0.35% at US$2404/ounce and iron ore is down 0.3% at US$108.16/tonne.
- AU$1.00 is buying US$0.66, 102.98 Japanese Yen, 51.33 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has downgraded the rating on DroneShield (ASX:DRO) from a buy to a hold and have increased the 12-month price target on the counter drone technology company from $1 to $1.60 noting all eyes are on H2 for DroneShield. Bell Potter sees the bullish long-term view of DroneShield remains unchanged, however, at its current valuation, DRO will attract increased scrutiny over its short-term performance and future contract announcements thus the analyst anticipates continued share price volatility.
- And Trading Central has identified a bullish signal on Centuria Capital (ASX:CNI) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may rise from the close of $1.69 to the range of $1.95 to $2.01 according to standard principles of technical analysis.
Wall St closed higher overnight as Nvidia shares led a turnaround on tech stocks and the S&P500 rose in its best day since early June. The Dow Jones gained 0.32%, the S&P 500 advanced over 1% and the tech-heavy Nasdaq rose by 1.58%.
In terms of US shares, Nvidia soared by 4.8% following their 8% decline last week. Other tech stocks including Alphabet and Meta also gained more than 2% each.
Over in Europe, markets closed higher as they react to the news that Joe Biden has dropped out of the US presidential race. The STOXX600 closed 1% higher with the majority of sectors finishing in the green. The only stocks which closed lower on Monday were travel and leisure and retail stocks which fell 2.33% and 0.03% respectively. Germany’s DAX rose 1.29%, the French CAC rallied by 1.16% and over in the UK, the FTSE100 ended Monday’s trading session 0.53% higher.
Locally yesterday, the ASX200 closed half a percent lower with the vast majority of sectors closing in the red. Losses were led by the energy and materials sectors which fell 1.62% and 0.86% respectively. This was slightly offset by the consumer staples sector which rose 0.65% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.70% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.52% lower at US$78.23/barrel, following renewed optimism for a ceasefire in Gaza which could as a result increase global oil supply.
- Gold is trading 0.02% higher at US$2395/ounce and iron ore is trading 0.26% lower at US$108.45/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Universal Store Holdings (ASX:UNI) and has increased its 12-month price target to $6.65. The buy rating is maintained by Bell Potter due to the company’s store roll-out & brand growth strategy, gross margin expansion via private label product penetration and earnings trajectory through to FY25 and FY26.
- And Trading Central has identified a bearish signal in Star Entertainment Group (ASX:SGR), indicating that the stock price may fall from the close of $0.50 to the range of $0.44-$0.46, on a pattern formed over 41 days according to the standard principles of technical analysis.
Wall Street closed sharply lower on Friday as investors dumped mega cap stocks in favour of smaller caps following the broad rally that sent key indices and valuations to record highs in recent months. The Dow Jones fell 0.93%, the S&P500 declined 0.71%, the tech-heavy Nasdaq ended the day down 0.81%, but the small-cap focused Russell 2000 climbed 1.68% on Friday.
CrowdStrike, the cybersecurity company behind the global IT outage on Friday, tanked 11.1% following the outage.
Over in Europe, markets closed lower as the global IT outage hit businesses in the region. The STOXX 600 fell 0.77%, marking a fifth straight losing day, as the travel sector plunged 2.07% amid widespread flight disruptions on the back of the IT outage. Germany’s DAX ended Friday’s session down 0.45%, the French CAC lost 0.7% and, in the UK, the FTSE100 ended the day down 50 points.
Across the Asia region tracked broad global market declines with Japan’s Nikkei falling 0.4% on Friday, while South Korea’s Kospi index declined 1.6% and Hong Kong’s Hang Seng ended the day down 2.1%.
Locally on Friday, the ASX200 fell 0.81% for a third straight losing day as the big miners weighed on the key index, tracking the declining price of key commodities, while tech stocks also tracked the sharp sell-off in tech stocks on the Nasdaq on Thursday. The local economy was thrown into chaos mode on Friday amid the global Microsoft system outage sparked by a system update run by cybersecurity company CrowdStrike in the early hours of Friday morning US time. The outage hit thousands of businesses and almost every sector was impacted. For the week, the ASX200 posted a slight gain of 0.15% as real estate, consumer staples and healthcare stocks posted gains over 1% which offset the heavy losses among materials and tech stocks.
What to watch today:
- Ahead of the first trading session of the new week, the SPI futures are anticipating the ASX to open the day down 0.84% tracking Wall Street’s broad large cap sell-off on Friday.
- On the commodities front this morning oil is trading 0.53% higher at US$80.43/barrel, gold is up 0.63% at US$2410/ounce and iron ore is down 0.26% at US$108.45/tonne.
- AU$1.00 dollar is buying US$0.67, 105.37 Japanese Yen, 51.74 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the rating on Whitehaven Coal (ASX:WHC) from a hold to a buy and have increased the 12-month price target from $8.90 to $9.90 as the analyst sees tailwinds incoming for the thermal and metallurgical coal producer. The company reported Q4 results last week outlining higher quarterly production, and higher managed saleable production than Bell Potter was expecting. 1H25 earnings are expected to strengthen at the same time stronger met coal demand is expected to provide additional earnings tailwinds.
- And Trading Central has identified a bearish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may fall from the close of $1.31 to the range of $0.99 to $1.05 according to standard principles of technical analysis.
The Australian market has been busy this week as we approach the FY24 results season. Some companies have provided early indications of their performance, while others have offered updates on their Q4 trading and future outlook. Which names stood out this week and how did this impact the local market as we head towards the mid-July?
In this week’s wrap, Grady covers:
- (0:31): why Accent Group soared this week
- (2:02): the sell-off in BHP Group
- (3:12): Domino’s worldwide strategic review
- (4:52) the winning and losing stocks of the week
- (5:43): the most traded stocks & ETFs by Bell Direct clients
- (6:09): economic data to watch next week.
Wall St closed lower overnight as investors continue the sell-off in some big technology names. The Dow Jones fell 1.29%, the S&P500 lost 0.78% and the tech-heavy Nasdaq ended Thursday’s trading session 0.7% lower.
Over in Europe, markets closed lower following the announcement that the European Central Bank will keep interest rates unchanged. The STOXX600 closed 0.16% in the red, its fourth successive day closing lower with technology stocks losing 1.8% where as autos stocks rose 1.23%. Germany’s DAX fell 0.45%, where as the French CAC and the UK’s FTSE100 both gained 0.21%.
Locally yesterday, the ASX200 fell 0.27% with the majority of sectors ending Thursday’s trading session in the red. Losses were led by the information technology sector which lost 3.39%. This was slightly offset by the utilities sector which closed 0.35% higher.
The unemployment rate for June was released yesterday at 4.1%, 0.1% higher than the 4% consensus and forecast.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 1.09% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.59% lower at US$82.36/barrel, gold is trading 0.65% lower at US$2445/ounce and iron ore is trading 0.41% lower at US$108.94/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Duratec Limited and has a 12-month price target of $1.52. Duratec (ASX:DUR) is a WA based specialist engineering contractor, with a strong reputation in the asset protection and specialist construction space throughout Australia. The buy rating is maintained by Bell Potter as the company has good options for long term growth, particularly in the defence space and the current share price of $1.24 is an attractive entry point.
- And Trading Central has identified a bullish signal in Adairs Limited (ASX:ADH), indicating that the stock price may rise from the close of $1.92 to the range of $2.19-$2.25, on a pattern formed over 51 days according to the standard principles of technical analysis.
Wall St closed mixed overnight as the Nasdaq posted its worst day since 2022. The Dow Jones rose 0.59%, the S&P500 fell 1.39% and the tech-heavy Nasdaq plummeted 2.77%.
This was the first time since 2001 in which the Nasdaq lost more than 2.5% in a trading session which saw meta platforms fall 5.7% and tech giants Netflix and Microsoft both also losing 1% each.
Over in Europe, markets closed lower as tech stocks ended the trading session in negative territory. The STOXX600 closed 0.43% in the red with most major sectors closing mixed on Wednesday. Germany’s DAX fell 0.44%, the French CAC dropped 0.12% whilst over in the UK the FTSE100 rallied by 0.28%.
Locally yesterday, the ASX200 ended Wednesday’s trading session 0.73% in the green with all major sectors finishing the day positively. Gains were led by the real estate and information technology sectors which rose 1.49% and 1.24% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.54% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 2.93% higher at 83 US dollars and 12 cents a barrel, rebounding from a three-day losing streak.
- Gold is trading 0.38% lower at 2458 US dollars an ounce and iron ore is trading 0.26% lower at 109 US dollars and 39 cents a tonne.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on PYC Therapeutics (ASX:PYC) and has an unchanged 12-month price target of $0.17. The speculative buy rating is maintained by Bell Potter as PYC have recently made strong progress across two Phase 1 clinical trials in which it is believed PYC are on the cusp of seeing patients respond to treatment which would provide considerable de-risking and value inflection for the lead asset and broader platform.
- And Trading Central has identified a bullish signal on Lindsay Australia (ASX:LAU), indicating that the stock price may rise form the close of $0.97 to the range of $1.12-$1.16, on a pattern formed over 55 days, according to the standard principles of technical analysis.
Wall Street extended its broad bull market rally into Tuesday with some key indices hitting record highs as investor optimism rises on rate cut hopes. The Dow Jones soared 1.85% to a fresh record high of 40,954.48, while the tech-heavy Nasdaq rose just 0.2% and the S&P500 ended the session 0.64% higher. Corporate earnings results have also started being released in the US which is adding fuel to the bull market. The Bank of America and Morgan Stanley both released results overnight that beat analysts’ forecasts and saw shares in the companies rise 5% and nearly 1% respectively.
Sentiment was boosted overnight by Fed chair Jerome Powell saying that Q2 economic data has bolstered confidence that inflation is cooling, with markets now pricing in two rate cuts this year, with the markets now pricing in a 100% chance of a rate cut in September.
In Europe overnight, markets in the region closed lower as investors responded to key corporate earnings results and assessed the impact of high interest rates on both outlook and earnings across the board. The STOXX 600 fell 0.21% on Tuesday, Germany’s DAX lost 0.39%, the French CAC fell 0.69%, and, in the UK, the FTSE100 ended the day down 0.22%.
Key fashion houses took the biggest hit in Europe overnight with Germany’s Hugo Boss tumbling 7.5% after the company cut its full-year sales outlook, while the U.K.’s Burberry lost 5.2% a day after the company issued a profit warning on weak luxury demand.
Across the Asia region on Tuesday, it was a mixed session across markets with Hong Kong’s Hang Seng falling 1.6%, while China’s CSI ended the day up 0.63%, Japan’s Nikkei gained 0.2% on Tuesday and India’s Nifty 50 hit an all time high, gaining 0.2%.
The local market slipped from record highs on Tuesday to close the day down 0.23% as the big iron ore miners weighed on the market, tracking the declining price of the iron ore futures. Rio Tinto’s share price fell 2% after reporting second quarter results that fell short of market expectations including iron ore shipments of 80.3 million tonnes compared to expectations of 82 million tonnes due to rail delays experienced during the quarter.
Droneshield tumbled 30% yesterday before hitting a trading halt then resuming trade after the counter-drone technology stock responded to a media speculation that cast doubt on the longevity of the company’s stellar rally over the last 12-months.
Lifestyle Communities recovered some ground yesterday with a 5.53% rally after a sell-off on Monday following media reports around treatment of some residents at its homes.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day up 0.65% tracking Wall Street’s bull run overnight.
- On the commodities front this morning oil has slipped 1.42% to trade at US$80.75/barrel, gold is up 1.92% at US$2469/ounce and iron ore is up just 0.08% at US$109.67/tonne.
- AU$1.00 is buying US$0.67, 106.65 Japanese Yen, 52.02 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has slightly increased the 12-month price target on Electro Optic Systems (ASX:EOS) and maintain a buy rating on the Australian defence manufacturer following the release of the company’s 1H24 results outlining a better-than-expected start to the year. Over the first half, EOS reported revenue rose 92% on the PCP to $142.6m which beat BPe, and Bell Potter continues to forecast a return to profitability for the company in CY25.
- And Bell Potter has maintained a buy rating on HUB24 (ASX:HUB) with a 12-month price target of $53.20 following the release of the specialist investment platform provider’s June quarter update including a strong Q4 performance of Funds Under Administration improving to $104.7bn, up 30% on the PCP and net flows of $5bn.
Wall Street rallied on the first trading day of the new week as investors now believe it is more likely for presidential candidate Donald Trump to reclaim the White House at the upcoming election following a failed assassination attempt of the former president over the weekend. The rally was also boosted by strong corporate results out as we near earnings season, with key banks including Goldman Sachs and BlackRock both beating profit expectations in results out overnight. The Dow Jones closed at a second consecutive session record with a rise of 0.4% on Monday, the Nasdaq also added 0.4% and the S&P500 ended the day up 0.3%.
Over in Europe, markets closed lower on Monday as investors digested some disappointing earnings results released on Monday. The STOXX 600 fell 1% as every sector ended the day in the red, while Germany’s DAX dropped 0.84%, the French CAC fell 1.19% and, in the UK, the FTSE100 ended the day down 0.85%. Shares in luxury brand Burberry plunged 16% after the company posted disappointing Q1 results including the axing of its dividend, while Swatch Group also dropped 9.8% as profits fell amid easing sales in China.
Across the Asia markets on Monday, it was a mixed session as investors assessed key economic data out in the region. China’s CSI index rose 0.11%, South Korea’s Kospi index fell 1.73%, and Japan’s Nikkei was closed for a public holiday.
China’s economic outlook took another hit yesterday with the world’s second largest economy reporting its worst pace in economic growth in five quarters with a GDP data showing expansion of 4.7%, down from the 5.3% reported in Q1 and well below economists’ expectations of a 5.1% reading. Weak domestic demand, falling yuan, persistent property downturn and trade tensions were the key drivers of the eased economic expansion. China’s retail sales for June also came in lower than expected with a 2% gain YoY compared with expectations of 3.3%.
The local market started the week with a modest gain of 0.73% to close with a fresh record of 8017.60 points with every sector ending the day in the green led by the tech sector jumping 1.4%. The broad market rally yesterday was driven by Wall Street’s record run that ended last week on a high note.
Aussie Broadband tumbled 14% on Monday after the company lowered its earnings guidance for FY25, while Lifestyle Communities tanked 18% on the back of a news report featuring residents of the company’s properties outlining alleged immoral and unethical conduct.
Star Entertainment shares lost 1% after the casino operator reported it has been forced to pause its electronic game rollout due to issues with the software.
What to watch today:
- Ahead of Tuesday’s trading session here in Australia the SPI futures are anticipating the ASX to open the day down 0.05%
- On the commodities front this morning, oil is trading 0.45% lower at US$81.84/barrel, gold is up 0.41% at US$2421/ounce and iron ore is flat at US$109.58/tonne.
- The Aussie dollar is buying US$0.68, 106.92 Japanese Yen, 52.19 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has maintained a hold rating on Nanosonics (ASX:NAN) and have increased the price target on the healthcare equipment and services company from $3 to $3.45 following the release of a trading update out of the company yesterday. Nanosonics outlined it expects revenues at the upper end of guidance and operating expenses to growth also within the specified range of 9-11%.
- And Trading Central has identified a bullish signal on Step One Clothing (ASX:STP) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may rise from the close of $1.47 to the range of $1.64 to $1.70 according to standard principles of technical analysis.
Wall Street re-entered record territory on Friday after a slight pullback on Thursday following the release of positive inflation data earlier in the week and as investors looked outside of the AI rally to capitalise on attractive investment opportunities across the broader market. The Dow Jones rose 0.62% to top 40,000 for the first time ever, while the S&P500 and Nasdaq rose 0.55% and 0.63% respectively. The banks fell on Friday despite posting stronger results than expected with JPMorgan shares sliding 1.2% despite topping Q2 revenue expectations and Citi fell 1.8% also despite beating on the top and bottom lines in Q2.
Over in Europe, markets closed higher across the region on Friday with the STOXX 600 rising 0.97% driven by telecom stocks after strong second quarter results boosted stocks in the sector. Germany’s DAX rose 1.15% on Friday, the French CAC added 1.27% and, in the UK, the FTSE100 ended the day up 0.36%.
Across the Asia markets on Friday, it was a mixed finish to the week across the region with Japan’s Nikkei falling over 2% after hitting record highs in the previous sessions. Hong Kong’s Hang Seng rose 2.6%, South Korea’s Kospi index fell 1.18%, and China’s CSI index rose 0.12% after Chinese exports beat expectations with a rise of 8.6% YoY in June indicating further recovery in the region post-pandemic.
Locally on Friday the ASX200 rose 0.88% to a record close with every sector aside from the tech sector ending the day higher, led by real estate stocks jumping almost 2%. The price of gold topped US$2400 late last week which boosted local gold miners including Bellevue Gold (ASX:BGL) rising 1.5%, Spartan Resources (ASX:SPR) soaring over 7% and Gold Road Resources (ASX:GOR) jumped 2.3%. The easing inflation data out of the US was the key driver of the gold price rally as markets are now pricing in a rate cut out of the Fed by September. The local big banks rallied on Friday with Commonwealth Bank (ASX:CBA) closing the day at a record $131.60 taking its market cap to $221bn, making it the largest company on the ASX.
What to watch today:
- Ahead of the first trading session of the new trading week the SPI futures are anticipating the ASX to open the day up 0.64% on the back of Wall Street’s strength on Friday.
- On the commodities front this morning oil is trading 0.15% higher at 82.34 per barrel, gold is down 0.16% at US$2,407 an ounce and iron ore is flat at US$109.58 per tonne.
- The Aussie dollar has strengthened again to buy 68 US cents, 107.14 Japanese Yen, 53.04 British Pence and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Coventry Group (ASX:CYG) from $1.80 to $2.00 and maintain a buy rating on the industrial supplies and services group following the release of a strong trading update out of the company for Q4 including group sales growth of 4% and the outlook for FY24 EBITDA of 22% growth on FY23.
- Trading Central has identified a bullish signal on IGO Ltd (ASX:IGO) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may rise from the close of $6.07 to the range of $6.47 to $6.57 according to standard principles of technical analysis.
The S&P 500 has notched seven consecutive record highs, fueled by investor optimism over AI advancements. Apple's ascent to the top of the market cap rankings underscores the technology sector's dominance. However, with valuations stretched, questions arise about the sustainability of this rally. This week's market update explores the driving forces behind the record-breaking surge and assesses potential investment opportunities.
In this video, Grady covers:
- (0:15): what’s behind the S&P500 hitting 7 consecutive record highs
- (0:33): why Apple overtook Nvidia as the most valuable company
- (0:58): how Ai optimism is driving the tech sector surge
- (4:59): how the ASX200 has performed this week so far
- (6:23): the most traded stocks & ETFs by Bell Direct clients
- (6:39): economic data to watch out for next week.
Wall Street extended its record run into the midweek session as a sharp rise in semiconductor stocks led the market rally for another day. The rally was also ahead of key US inflation data out on Thursday US time with economists’ expecting the inflation rate month-on-month to rise just slightly by 0.1% in June from May, while the YoY inflation rate is expected to cool to 3.1% in June from 3.3% in May. Core inflation is anticipated to show a 0.2% growth and core inflation yearly is expected to remain at 3.4%. The S&P500 topped 5600 points for the first time overnight and closed with a gain of 1.02% for a seventh straight day of gains and record closes. The Nasdaq added 1.18% on Wednesday to also close at a record high and the Dow Jones overturned its recent slump to close higher. Taiwan Semiconductor stock rose 3.5% after revenue from April to June beat Wall Street estimates while AI darling Nvidia rose 2.7%.
Across the European region markets closed higher on Wednesday after a shaky start to the week with the STOXX 600 rising 0.93% at the end of the midweek session, while Germany’s DAX added 0.94%, the French CAC rose 0.86% and, in the UK, the FTSE100 ended the day up 0.66%.
Asia markets closed mostly higher on Wednesday following the release of key inflation data out in the region. Japan’s Nikkei closed at a fresh record high as corporate goods price index data rose 2.9% in June from a year earlier which met economists’ expectations. Hong Kong’s Hang Seng was flat on Wednesday and South Korea’s Kospi index posted a slight gain at the session’s end.
Despite a strong night on Wall Street on Tuesday, the local market fell 0.16% on Wednesday as the miners weighed on the key index tracking the declining price of iron ore. Communications services stocks rose 1.46% on Wednesday to offset some of the heavy losses among the miners while consumer staples and financial stocks also closed the day in positive territory.
Incitec Pivot (ASX:IPL) shares fell 1.2% after the company ended negotiations with Indonesia’s PT Pupuk Kalimantan Timur for the sale of its fertilisers business. Bell Financial Group (ASX:BFG) shares rallied on Wednesday after announcing the expectation of a 47% rise in first-half PBT to $23.8 million. Immune-oncology company Imugene (ASX:IMU) jumped 6% on Wednesday after announcing it has dosed its first patient in its trial for bile tract cancers.
What to watch today:
- Ahead of Thursday’s session on the ASX the SPI futures are anticipating the ASX200 to open the day up a sharp 0.94% following Wall Street’s record rally overnight.
- On the commodities front this morning oil is trading 1.26% higher at US$92.43/barrel, gold is up 0.34% at US$2371.97/ounce and iron ore is up 0.45% at US$110.51/tonne.
- The Aussie dollar has modestly strengthened overnight to buy US$0.67, 109.09 Japanese Yen, 52.61 British Pence and NZ$1.11.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Genetic Signatures (ASX:GSS) from 75cps to $1.10 and maintain a speculative buy rating on the specialist molecular diagnostics company following the receipt of first FDA clearance for the company being a transformational milestone, allowing commercialisation into the USA. The FDA-cleared test, called the ‘Gastrointestinal Parasite Detection Kit’ is differentiated from US competitors by its broader coverage of 8 pathogen targets compared to only 3-4 covered by existing multiplex kits. Bell Potter sees first sales in the US are expected in 1HFY25.
- And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU) following the formation of a pattern over a period of 23-days which his roughly the same amount of time the share price may rise from the close of $2.51 to the range of $2.72 to $2.76 according to standard principles of technical an
The S&P500 and the Nasdaq both closed at all-time highs ahead of inflation data and second-quarter earnings reports. The S&P500 is coming off its fourth positive eek in the last give amid ongoing optimism that easing inflation could lead to the Fed interest rate cuts. The index closed 0.1% higher overnight, while the tech-heavy Nasdaq gained 0.28% and the Dow Jones closed slightly lower, down 0.08%.
It was a choppy session locally yesterday, with the ASX200 closing in the red, down 0.76%, as materials and energy stocks weighed down on the market.
What to watch today:
- The ASX200 is set to open higher this morning, with the SPI futures suggesting a rise of 0.22% at the open.
- In economic data, Westpac’s consumer confidence data will be out today, forecast to fall 0.3%. The benchmark current sits at 83.6 in June, far from the neutral level of 100 as fiscal support measures have been insufficient to ease worries of high inflation and heightened interest rates. Also today, NAB’s business confidence data will be released, also forecast to decline.
- In commodities,
- Crude oi is trading more than 1.4% lower at US$82.25 per barrel, extending the pullback from the over-two-month high of $84 hit on July 4th, with short-term supply threats a concern.
- The price of gold is down more than 1.3% at $2,359.16 an ounce, taking a pause from the sharp rally that was led by expectations that the Federal Reserve could cut interest rates in September, following the soft US jobs data released last week.
- And iron ore is also trading in the red, down 1.55% to US$111.31 per tonne, pulling back from an over one-month high as a four-day rally triggered profit taking.
Trading Ideas:
- Bell Potter have downgraded their recommendation on IGO Limited (ASX:IGO from a Hold to a Sell, and have lowered their 12-month price target from $7.60 to $5.15. at it’s current price of $5.70, this is down 9.6% in a year.
- And Trading Central have identified a bearish signal in LGI Limited (ASX:LGI) indicating that the stock price may fall from the close of $2.84 to the range of $2.71 to $2.75 over 34 days, according to the standard principles of technical analysis.
Favourable jobs data boosted Wall St to a positive finish on Friday investor optimism of rate cuts out of the Fed gained further traction. The S&P500 notched another record close, ending the day up 0.54%, while the tech-heavy Nasdaq jumped 0.9% and the Dow Jones ended the day up 0.2%. Nonfarm payrolls for June saw 206,000 jobs added to the economy but the U.S. unemployment rate ticked up to 4.1% which was higher than economists’ expectations and indicates further loosening of the tight U.S. labour market.
Over in Europe, markets closed mixed as investors assessed the outcomes of key parliamentary elections in the region. The STOXX 600 fell 0.22%, Germany’s DAX gained 0.14%, the French CAC fell 0.26% and, in the UK, the FTSE100 ended the day down 0.45% as investors responded to the result of the UK’s general election where the opposition Labour Party won a vast majority, unseating the Conservatives after 14-years.
Across the Asia markets on Friday, it was a mixed session as key economic data weighed on equities markets. South Korea’s Kospi Index rose 1.32% on Friday, while Hong Kong’s Hang Seng fell 1.13%, China’s CSI lost 0.43% and Japan’s Nikkei fell 0.49% from recent record highs after household spending for May unexpectedly dipped 1.8% in real terms for May which fell well short of economists’ expectations of a 0.1% rise.
Locally on Friday the ASX200 fell 0.1% in a quiet session however the key index still posted a 0.7% gain for the week as coal and gold stocks boosted the ASX200 higher. Miners weighed on the key index on Friday amid the sliding price of iron ore and the big banks each posted a decline too.
Healthcare stocks offset some of the heavy losses on Friday with CSL, ResMed and Cochlear each ending the day in positive territory.
What to watch today:
- Ahead of the first trading session of the new trading week, the SPI futures are anticipating the ASX to open the day down 0.14%.
- On the commodities front this morning, oil is down 0.17% at US$83.24 per barrel, gold is down 0.2% at US$2386.04 per ounce and iron ore is down 1.55% at US$111.31 per tonne.
- The Aussie dollar has strengthened to buy US$0.67, 108.41 Japanese Yen, 52.70 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage on Percheron Therapeutics (ASX:PER) with a speculative buy rating and a price target of 14cps with the analyst saying it is a high risk, high reward outlook for the company. Percheron is an Australian biotechnology company seeking to develop ATL 1102 for the treatment of Duchenne Muscular Dystrophy, a degenerative neuromuscular disorder caused by a mutation in the gene responsible for the production of dystrophin. The company’s next catalyst is the release of headline data from the phase 2b clinical trial due in 2HCY24.
- Trading Central has identified a bearish signal on Treasury Wine Estates (ASX:TWE) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may fall from the close of $12.25 to the range of $10.70 to $11.00 according to standard principles of technical analysis.
The AI revolution is upon us, driving innovation and progress at an unprecedented pace. Explore the growing water demands of AI and the impact it has on utilities. Plus, delve into potential investment opportunities within the utilities sector that are poised to benefit from this trend.
In this week’s wrap, Grady covers:
- (0:10): how AI could reshape the utilities sector
- (2:48): why AI’s hidden energy demands could threaten the grid
- (3:50): the ASX-listed stocks benefiting from AI
- (4:45): how the ASX200 performed this week so far
- (5:44): the most traded stocks & ETFs by Bell Direct clients
- (6:12): economic news items to watch out for next week.
US equities extended the bull market run on Wall Street overnight in a shortened session. Trading volume was muted with the New York Stock Exchange closing early a 1pm and will be closed tonight for Independence Day. The S&P500 and the Nasdaq both closed at record highs, with investors looking past soft economic data. The S&P500 gained 0.5%, while the Nasdaq closed 0.88% in the green, as mega cap tech names rallied, including Tesla and Nvidia.
European markets rallied with all major benchmarks closing in the green ahead of two national parliamentary elections, with the UK voting on Thursday followed by France on Sunday.
After a negative run last week, the STOXX600 has been volatile in July so far. The index closed 0.8% higher, with most sectors in the green, primarily lead by mining stocks. The German DAX up 1.16%, Fance’s CAC up 1.24% and the FTSE 100 advanced 0.6%.
After a choppy session on the ASX200 yesterday, the key index posted a 0.28% gain at the closing bell, as investors weighed unfavorably strong retail sales data against a tech rally, prompted by the Nasdaq hitting a record high the prior trading session. Retail sales data came in at a rise of 0.6% for May, which is significant from the 0.1% increase reported in April and well above economist expectations. The data, however, wasn’t favorable for retail companies, as it was due to heavy discounting to move inventory levels as opposed to profit making on an earnings front. Building permit data in Australia for May was also out yesterday, up 5.5%, again above expectations. Both readings show the RBA’s case at taming inflation remains a difficult task as these drivers of inflation remain high.
What to watch today:
- Our local market is set to open higher this morning, with the SPI futures suggesting a 0.94% rise at the open.
- In economic data, balance of trade data for May will be out today. Australia’s trade surplus on goods widened to $6.55 billion in April, from a downwardly revised $4.84 billion in the previous month, surpassing market forecasts.
- In commodities,
- Crude oil is rallying, up 1.05% at US$83.68 per barrel, holding close to a two-month high amid lingering concerns about lower supply.
- The price of gold is up more than 1.1% to US$2,357.71 an ounce, hovering at its highest price in a month due to the drop in the US dollar and Treasury yields.
- And iron ore is trading 2.15% higher at US$110.32 per tonne, rising for the fourth straight session and hitting a one-month high amid an improving demand outlook in top consumer China.
Trading Ideas:
- Bell Potter maintains a Speculative Buy rating on Chalice Mining (ASX:CHN) and have increased their valuation from $5.00 to $5.15. At CHN’s current share price of $1.22, this implies over 100% share price growth in a year.
- Trading Central have identified a bullish signal in NRW Holdings (ASX:NWH) indicating that the stock price may rise from the close of $3.09 to the range of $3.34 to $3.40 over 7 days, according to the standard principles of technical analysis.
Wall St closed higher on Tuesday after Fed Chair Jerome Powell acknowledged progress on inflation but reiterated that the Fed was not quite ready to cut rates just yet. The Dow Jones rose 0.41%, while the the S&P500 gained 0.62% to close at a record 5509 points and the Nasdaq jumped 0.84% to a record close of 18,028.76 points.
Tesla shares rose 4% on Tuesday after the EV company reported better-than-expected deliveries for the second quarter, while Apple shares hit a new intra-day high over US$220/share on Tuesday as investors assess the company’s plans to introduce AI to its iPhones and other products.
In Europe overnight, markets closed lower following the release of key eurozone inflation data. The STOXX 600 fell 0.4% on Tuesday, while Germany’s DAX lost 0.69%, the French CAC declined 0.3% and, in the UK, the FTSE100 ended the day down 0.56%. Headline inflation in the euro area dipped to 2.5% in June which met economists’ expectations, however, core and services inflation remained stubbornly high which sparked the equity-sell off yesterday.
Across the Asia markets on Tuesday, it was a mostly green close across the region as Japan’s Nikkei rose 1.12% to close at a 3-month high while Japan’s broader Topix index rose 1.15%. Elsewhere, Hong Kong’s Hang Seng rose 0.33% while South Korea’s Kospi index fell 0.84% after South Korea’s inflation rate came in at 2.4% which missed economists’ expectations of 2.7%.
What to watch today:
- The local market extended this week’s red run into Tuesday’s session with the ASX200 closing the day down 0.42% as investors assessed the hawkish comments out of the RBA in the latest meeting minutes release yesterday. A near two-month high price of oil boosted the energy sector to a 2% gain which offset some of the heavy losses among REIT and bank stocks yesterday.
- The latest RBA meeting minutes were released yesterday with a very hawkish tone continuing through the latest update. Michele Bullock outlined in the minutes that it is difficult to rule in or out future policy moves as the outlook remains highly dependent on economic data in order to tame inflation to the target 2-3% range by the RBA’s deadline of 2026. Retail sales and new building permits data in Australia released today will play a vital role in the economic data-driven rate outlook for the RBA at the next meeting.
- Lithium developer Liontown Resources (ASX:LTR) rallied over 7% on Tuesday after announcing the securement of US$250m in funding from South Korean battery conglomerate LG Energy Solutions under a 10-year funding agreement.
- Domino’s Pizza (ASX:DMP) shares came under pressure yesterday after Barrenjoey and Ord Minnett noted the Pizza giant is facing three major earnings challenges through a weakening Japanese Yen, a jump in cheese prices and a slower than forecast store rollout, which are likely to hurt earnings in FY24.
- On the commodities front this morning, oil is trading 0.61% lower at US$82.87/barrel, gold is down 0.3% at US$2325.83/ounce, iron ore is up 1.4% at US$108/tonne.
- 1 Aussie dollar is buying 67 US cents, 107.63 Japanese Yen, 52.56 British Pence and 1 New Zealand dollar and 10 cents.
- Ahead of the midweek trading session in Australia the SPI futures are anticipating the ASX to open the day up 0.25% on the back of Wall Street’s strength overnight.
Trading Ideas:
- Bell Potter has downgraded the rating on Monadelphous Group (ASX:MND) from a buy to a hold and reduced the 12-month price target on the leading Australian engineering group following the analyst revisiting key indicators including the outlook for a quietening major project development pipeline with limited visibility on near-term contract awards. With the outlook for reduced Engineering Construction division revenue contribution to the group, it will likely lead to EBITDA pressures.
- Trading Central has identified a bearish signal
Wall Street started the second half of the US financial year with a green close that saw the Nasdaq settle the day at a fresh record high as positive momentum from the first half extends into the second half. The Dow Jones rose 0.13%, the S&P500 added 0.27% and the tech heavy Nasdaq rose 0.83% to a fresh record close of 17,879.30. US Manufacturing PMI data out this morning showed a slight contraction in manufacturing output for June to 48.5 from 48.7 in May, with the reading falling short of economists’ expectations of 49.1 points indicating the US economy continues to ease under the high interest rate environment.
Across the European markets overnight, it was a sea of green as investors responded to the first round of France’s snap parliamentary election. The STOXX600 rose 0.44%, Germany’s DAX added 0.3%, and in the UK, the FTSE100 ended the day up 0.03%. The French CAC rallied 1.09% on Monday as investors digested the results of the first round of France’s legislative election where Marine Le Pen’s party won the first round by a smaller margin than expected. The rally comes as investors welcome to smaller margin win, as, if the party dominated to form a majority quickly, concerns are raised over the fast ability of their proposals in spending and tax to be pushed through quickly thus potentially tipping the region into a debt crisis.
Across Asia on Monday, it was a positive start to the second half of the year as investors assessed key economic data out in the region including China’s manufacturing activity and Japan’ consumer confidence readings. Japan’s Nikkei rose 0.12% on Monday while Japan’s broad index the Topix climbed 0.52% to a new 34-year high. China’s CSI index rose 0.48% on Monday and South Korea’s Kospi index ended the day up 0.23%. China’s Caixin manufacturing PMI figures rose to 51.8 points in June from 51.7 points in May, in a sign of ongoing recovery in the region, while Japan’s consumer confidence rose to 36.4 points in June from 36.2 points in May.
What to watch today:
- The local market started the new financial year 0.22% lower as investors reacted to key inflation data out in the US and Europe late last week and ahead of the RBA meeting minutes out locally today. The rate-sensitive tech sector took the biggest hit yesterday with a decline of 2.2% as investors took profits from the sector’s stellar rally over the last 12-months and ahead of a potential rate rise or prolonged hold out of the RBA.
- Gas producer Strike Energy tumbled over 16% yesterday after providing an update on the status of its West Erregulla gas supply agreement with Wesfarmers. Due to delays in receiving environmental approvals and the subsequent delays to the company’s final investment decision, the firm gas supply agreement has reverted to the original option for gas supply that is condition on Strike taking FID on a commercial project.
- Coronado Global Resources soared 9% on Monday though as investors see an attractive buy opportunity in the coal producer on news that its closest competitor, Anglo American has halted operations at its Queensland mine due to a fire burning underground in a major coal mine owned by the company.
- On the commodities front this morning oil is trading 2.3% higher at US$83.42/barrel, gold is up 0.1% at US$2328.73/ounce and iron ore is flat at US$106.51/tonne.
- 1 Aussie dollar is buying 66 US cents, 107.39 Japanese Yen, 52.66 British Pence and 1 New Zealand dollar and 10 cents.
- Investors locally will be eagerly awaiting the release of Michele Bullocks’ latest RBA meeting minutes out today to gain insight into the rate outlook down under. The last minutes and comments out of the RBA were taken as hawkish so it is unlikely Ms Bullocks’ stance will change given inflation drivers remain stubbornly high. Australian retail sales and building approvals data are set for release on Wednesday which will give further insight into the stickin
Wall street ended the last trading day of the US first half in negative territory despite US inflation data indicating inflation is easing in the US alongside the release of better-than-expected consumer sentiment figures. The S&P500 fell 0.41%, the Nasdaq lost 0.71% and the Dow Jones ended the day down 0.12%. US inflation data for May slowed to its lowest rate in more than three years with the Fed’s preferred measure of inflation, the Personal Consumptions Expenditures price index rising just 0.1% on April and 2.6% from the prior year.
Over the first half of 2024, the tech-heavy Nasdaq soared 18.1% as the AI movement boosted investor appetite for the high growth tech sector. The S&P500 rose 14.5% over the first half to record territory, and the Dow Jones rose just 3.8% over the first 6-months.
Over in Europe, markets closed mostly lower on Friday as investors assessed the release of key inflation data in the region and around the world. The STOXX600 fell 0.24% on Friday, Germany’s DAX rose 0.14% while the French CAC fell 0.68%, and in the UK, the FTSE100 ended the day down 0.19%. On Friday, fresh economic data released showed French and Spanish inflation eased in June while the UK posted economic growth of 0.7% for the first three months of the year.
Asia markets closed modestly higher on Friday led by Japan’s Topix index rallying 0.57% to a 34-year high on upbeat economic data. Japan’s Nikkei rose 0.64% on Friday, Hong Kong’s Hang Seng rose 0.01% and South Korea’s Kospi index ended the day up 0.49%.
Headline inflation for Tokyo rose to 2.3% in June while the country’s industrial production rose 2.8% MoM in May which beat economists’ expectations. The readings provide Japan’s central bank room to tighten its monetary policy as its currency has plunged to a multi-decade low.
What to watch today:
- Locally on the last trading session of FY24, the ASX200 rose 0.1% to finish the financial year up 7.8%. The rally on Friday was driven by the banks and tech stocks rising before the US inflation print was released later after market close.
- Insurance Australia Group soared 7.2% on Friday after outlining two significant deals have been signed including one with US-listed Berkshire Hathaway for reinsurance protection, and the company also reaffirmed profit guidance to be at the upper end of guidance ranges for FY24.
- Elsewhere, burrito giant Guzman Y Gomez (ASX:GYG) fell 7.5% on Friday, marking its worst one-day performance since debuting on the ASX.
- Adore Beauty (ASX:ABY) shares tumbled 5.85% on Friday after the company announced the acquisition of Ikou, a wellness and skincare brand, for $25m.
- Ahead of the first trading session of the new financial year, the SPI futures are anticipating the ASX to open the day down 0.45% carrying negative sentiment from Wall Street on Friday into the new local trading week.
- On the commodities front this morning oil is trading 0.09% lower at US$81.56/barrel, gold is down 0.06% at US$2325/ounce and iron ore is flat at US$106.51/tonne.
- The Aussie dollar has slightly strengthened to buy 67 US cents, 107.40 Japanese Yen, 52.86 British Pence and 1 New Zealand dollar and 10 cents.
Trading Ideas:
- Bell Potter has increased the 12-month price target on De Grey Mining (ASX:DEG) from $1.76 to $1.82 and maintain a speculative buy rating on the gold miner after the company announced it has received Credit Approved Term sheets from a syndicate of domestic and offshore commercials banks for a proposed $1bn senior debt facility. This will support the construction of its 100%-owned Hemi Gold Project which has an estimated CAPEX of $1.345bn and substantially reduces the financial risk of the company.
- Trading Central has identified a bearish signal on ARB Corp (ASX:ARB) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the
This week, the market witnesses a sharp reversal in the artificial intelligence driven rally. Investors are re-evaluating their portfolios in light of the approaching end of FY24 and Australia’s recent inflation data. The Reserve Bank of Australia’s decision to hold rates at 4.35% was followed by hawkish comments, seemingly justified by higher-than-expected inflation figures.
In this week’s wrap, Grady covers:
- (0:43): what is driving inflation to remain sticky
- (2:24): an analysis on the unemployment rate
- (3:35): the impact of inflation on Australia’s rate outlook
- (4:34): the best performing stocks on the ASX200 this week
- (5:25) the most traded stocks & ETFs by Bell Direct clients
- (5:55): economic data to watch out for next week.
US equities closed in the green as investors await inflation data with the send of the second quarter approaching. The Dow Jones and the S&P500 both ended the session 0.09% higher, while the tech-heavy Nasdaq gained 0.3%, with AI companies gaining momentum. After hours, a big mover was Nike, its shares down more than 12% after the athletic retailer cut its full-year guidance.
Locally yesterday, information technology and healthcare sectors lead the market, while real estate and utilities declined the most. The ASX200 ended the trading session down 0.3%.
What to watch today:
- The Australian share market is set to open higher this morning, with the SPI futures suggesting a rise of 0.34%.
- In commodities,
- Crude oil is trading 1.25% higher at US$81.91 per barrel, nearing a two-month high as supply concerns due to escalating conflict in the Middle East outweighed a surprise increase in US stockpiles.
- Gold rebounded, trading a US$2,327 an ounce after having tested the lowest in nearly three months earlier in the session, as markets digested data for hints of the Fed’s policy outlook this year.
- And iron ore is steady at US$106 per tonne.
- In economic data today, housing credit and private sector credit data for May will be released today.
Trading Ideas:
- Bell Potter maintain a BUY rating on Lynas Rare Earths (ASX:LYC) after the company announced it intends to update its Lynas Malaysia Plant. Bell Potter think the share price could be undervalued. They have increased their price target from $7.55 to $7.80. At LYC’s current share price of $5.95, this implies 31% share price growth in a year.
- Trading Central have identified a bullish signal in Northern Star Resources (ASX:NST) indicating that the stock price may rise from the close of $13.01.
Wall Street extended gains across the major averages on Wednesday as investors assessed their holdings in the final trading sessions of a very strong first half driven by AI and semiconductor stocks. The S&P500 rose 0.16% at the end of the midweek session, the Nasdaq rose just under half a percent and the Dow Jones ended the day up just 0.04%, recovering from a red start to the final trading week of June. Amazon shares rose 3.9% on Wednesday to reach a record high and tipped the tech giant’s market cap over US$2tn for the first time. Investors in the US now await the release of key PCE data out on Friday which will provide a key insight into how well the Fed’s rate strategy is working to achieve the target inflation of 2%.
European markets closed lower across the board on Wednesday, extending the negative trading sentiment of the week into another session. The STOXX600 fell 0.5% as auto and leisure stocks weighed on the index, while Germany’s DAX lost 0.12%, the French CAC fell 0.69% and, in the UK, the FTSE100 ended the day down 0.27%. Shares of German auto-making giant Volkswagen fell 1.64% after the company announced a $5bn investment in US-listed EV startup, Rivian.
Asia markets mostly rose on Wednesday, taking lead from the tech-rally in the US on Tuesday. Japan’s Nikkei gained 1.26% to close at a 2-month high, South Korea’s Kospi index rose 0.64% and China’s CSI index recovered some of this week’s losses to end the day up 0.65%. Singapore’s May factory output rose 2.9% in data out yesterday which beat economists’ expectations of a 2% rise, indicating strength in the Singaporean economy.
What to watch today:
- Locally on Wednesday investors reacted negatively to the latest inflation print out in Australia indicating the annual CPI or inflation rate rose to an annual rate of 4% in May, up from the 3.6% reported in April and well exceeding economists’ forecasts of a 3.8% reading in May. Investors naturally hit the sell-button on equities across the board in afternoon trade on Wednesday leading to a close of 0.71% lower for the ASX200, amid fears of the RBA potentially handing down another rate hike in months to come as inflation and key drivers remain sticky and stubborn. The reading weighs into RBA governor Michele Bullocks hawkish outlook for rates in Australia and will throw a curveball at for the RBA’s next rate decision.
- Lithium miners felt further pain yesterday with a widespread sell-off in the sector as the price of the commodity fell 5%, extending the month’s losses to 15%.
- Harvey Norman (ASX:HVN) shares fell over 8% on Wednesday as analysts’ at Barrenjoey predict weaker macro-economic conditions will hurt earnings for the retail giant.
- Collins Foods rally on Tuesday was short lived as investors hit the sell button yesterday sending shares in the restaurant operator down 7% on Wednesday after Citi retained its sell rating post the release of the results, with analysts at the broker citing they were disappointed to see management no longer expects margin improvements in FY25 against challenging market conditions.
- On the commodities front this morning oil is trading 0.07% lower at US$80.78/barrel, gold is down 0.92% at US$2298.48/ounce and iron ore is down 0.08% at US$106.46/tonne.
- The Aussie dollar has slightly weakened overnight against the greenback to buy 66 US cents, but is showing strength against other currencies with 1 AUD buying 106.85 Japanese Yen, 52.61 British Pence and 1 New Zealand dollar and 9 cents.
- Ahead of the second last trading session for June, the SPI futures are expecting the ASX to open the day down 1.09%, extending on yesterday’s inflation driven sell-off.
Trading Ideas:
- Bell Potter has increased the rating on Paladin Energy (ASX:PDN) from a hold to a buy and have increased the 12-month price target on the uranium miner from $15.70 to $16.10 after the company anno
Wall street closed mixed on Tuesday as the S&P and Nasdaq snapped 3-day losing streaks while the Dow Jones reversed gains to close lower as investors regain appetite for AI-stocks after some profit taking sessions. The Dow Jones fell 0.76% on Tuesday, while the S&P 500 and Nasdaq ended the day up 0.39% and 1.26% respectively, driven by Nvidia jumping 6.7%. In recent weeks we have seen investors in the region shift focus from rate-driven sentiment to a bull market driven purely by the AI movement.
In Europe overnight markets closed lower amid investor fears of rising geopolitical tensions in the region. The STOXX600 fell 0.3% weighed down by industrial stocks, while Germany’s DAX lost 0.81%, the French CAC declined 0.58% and, in the UK, the FTSE100 ended the session down 0.41%. Airbus shares fell 9.4% on Tuesday after the company announced aircraft delivery and earnings target cuts for 2024, while drug maker Novo Nordisk rose 4% after the company’s Wegovy weight loss treatment has been approved in China for long-term weight management.
Across the Asia markets on Tuesday, China’s CSI 300 closed at its lowest level since February despite the rest of the region rallying yesterday. Japan’s Nikkei rose 0.95% on Tuesday, Hong Kong’s Hang Seng added 0.25% and South Korea’s Kospi index ended the day up 0.35% on a clime in consumer confidence in the region.
What to watch today:
- Locally yesterday, the ASX recovered on Tuesday from Monday’s sell-off to close the day up 1.36% taking lead from Wall Street rising on Monday and buoyed by a strong rally for the local banks which saw CBA rise to a record high yesterday. Mining giants were also boosted yesterday by a rise in the price of oil which led to the energy sector ending the day up with a strong 2.23% rally.
- KFC Australia operator Collins Foods jumped over 7.3% yesterday after the restaurant operator released full year results including record revenue and rising earnings in this challenging market. Collins Foods reported revenue rose 10.4% to $1.4889bn, and underlying NPAT rose 15.6% to $60m. Collins also reported net operating cash flow rose $30.2m and net debt was reduced by $46.7m. Investors welcomed the 28cps fully franked final dividend declared by the company which is up from 27cps in FY23.
- Casino operator Sky City Entertainment Group recovered some of Monday’s losses on Tuesday after announcing it has entered into an unconditional agreement to sell its entire shareholding comprising around 10% in Gaming Innovation Group, a European-based online gaming platform provider, for around NZ$55m with proceeds to be used to pay down Sky’s debt as part of its capital management review.
- On the commodities front this morning, oil is trading 1.11% lower at US$80.72/barrel, gold is down 0.53% at US$2318/ounce, and iron ore is down 0.38% at US$106.55/tonne.
- 1 Aussie dollar is buying 66 US cents, 106.15 Japanese Yen, 52.57 British Pence and 1 New Zealand dollar and 9 cents.
Today is a big day on the economic calendar locally with the release of Australia’s inflation print out this morning with the expectation of a slight uptick to 3.8% from 3.6% in April which if it does come in at this reading, will indicate inflation remains sticky and the RBA has a tough job ahead on a rate front. - Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day down 0.37%.
Trading Ideas:
- Bell Potter has slightly increased the 12-month price target on Cleanaway (ASX:CWY) from $3.10 to $3.15 and maintain a buy rating on the leading waste and environmental services company in Australia after the company announced the acquisition of Melbourne-based Citywide Waste which will add three key waste services to Cleanaway’s Melbourne Metro operations and a further 1500 C&I customers in metro Melbourne.
- Trading Central has ident
Wall Street started the new trading week mixed as investors sold out of big tech stocks in favour of the banks and energy stocks. The Dow Jones rose 0.6% on Monday while the S&P500 and Nasdaq posted declines of 0.31% and 1.09% respectively. The pullback in tech stocks is ahead of the U.S. PCE data released later this week which is the Fed’s preferred measure of inflation and is expected to be a 0.1% rise on April which would indicate a decline from April’s 0.2% rise and signal inflation is easing. With some key inflation drivers remaining sticky though, investors have been bracing for higher interest rates for longer.
Over in Europe markets closed higher on Monday ahead of key inflation data and central bank decisions out in the region this week. The STOXX600 rose 0.8% on Monday, Germany’s DAX added 0.89%, the French CAC climbed 1.03% and, in the UK, the FTSE100 ended the day up 0.53%.
Asia markets mostly slipped on Monday as investors in the APAC region brace for key inflation data out later this week in Japan and Australia. Hong Kong’s Hang Seng fell 0.88% on Monday while China’s CSI index fell 0.54% yesterday.
What to watch today:
- The local share market started the new trading week 0.8% lower following the release of some disappointing company updates and ahead of the release of Australia’s inflation print. Energy stocks took the biggest hit to start the new trading week as the sector closed the day down 1.76% while healthcare was hit with a 1.63% decline on Monday.
- Sleep apnoea specialist ResMed (ASX:RMD) tumbled 13.2% on Monday on fresh results of a weight loss drug-trial spooked the market about the relevance of ResMed’s devices once again, while online fashion luxury retail platform Cettire (ASX:CTT) tanked 49% after the company said its Q4 trading had been hit by a lull in online luxury spend.
- Elsewhere in fashion, Myer (ASX:MYR) shares jumped 22% on Monday after the department store giant announced it is looking into a potential merger with Premier Investments’ apparel business which includes Just Jeans.
- Embattled casino operator Star Entertainment (ASX:SGR) fell a further 5.7% yesterday after the company issued a profit warning and noted that former Chairman, David Foster, has left the board.
- Local iron ore miners also felt the brunt of investor demand concerns with a decline on Monday, tracking the price of the commodity amid fears of prolonged subdued demand out of China.
- Ahead of Tuesday’s trading session the SPI futures are anticipating the ASX to open the day up 0.47%.
- On the commodities front this morning oil is trading 1.17% higher at US$81.68/barrel, gold is up 0.5% at US$2333/ounce and iron ore is down 0.18% at US$106.96/tonne.
- 1 Aussie dollar is buying 67 US cents, 106.26 Japanese Yen, 52.87 British Pence and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Bell Potter has downgraded City Chic (ASX:CCX) from a buy to a hold and have significantly reduced the 12-month price target on the plus size fashion retailer from 62cps to 20cps following the announcement of the company divesting its US business and the company undertaking a capital raising with proceeds aiming to pay down debt.
- Trading Central has identified a bullish signal on Jupiter Mines (ASX:JMS) following the formation of a pattern over a period of 30 days which is roughly the same amount of time the share price may rise from the close of $0.32 to the range of $0.42 to $0.44 according to standard principles of technical analysis.
Locally last week, the ASX200 advanced 0.93% Monday to Friday with the utilities, financials and healthcare sectors leading the market. Sigma Healthcare (ASX:SIG), Telix Pharmaceuticals (ASX:TLX) and Gold Road Resources (ASX:GOR) advanced the most last week, while Mineral Resources (ASX:MIN) and Liontown Resources (ASX:LTR) each declined more than 10%.
US equities closed mixed on Friday. The Dow Jones edged up 15.57 points, posting its best week since May. The S&P500 closed lower as Nvidia shares pulled back for a second day, while the tech-heavy Nasdaq closed down 0.18%.
What to watch today:
- The ASX200 is set to open lower this morning. The SPI futures are suggesting a fall of 0.21%, as investors brace for a possible acceleration in inflation.
- In commodities,
- Oil has softened with the price of crude oil down to US$80.58 per barrel, after its second weekly advance as falling US crude inventories and an escalating conflict in the Middle east bolstered oil prices. Energy shares to watch include Santos (ASX:STO) and Woodside Energy (ASX:WDS).
- Gold is down more than 1% to US$2,230.85 an ounce, not far from the over-one-month-low of US$2,290 touched on June 4th. Is decline is due to the pressure of a firm US dollar and lower central bank demand in Asia.
- Iron ore is trading steady at US$106.96 per tonne, holding near the lowest level since April.
- Watch the share price movements of GUD Holdings (ASX:GUD) as they hold their AGM today, Metacash (ASX:MTS) as they release their earnings report today and Steadfast Group (ASX:SDF) with their investor briefing set for today.
Trading Ideas:
- Trading Central has identified a bullish signal in SG Fleet Group (ASX:SGF) indicating that the stock price may rise from the close of $3.15 to the range of $3.40 to $3.46 over 21 days.
- Trading Central have a bullish signal in ClearView Wealth (ASX:CVW) indiciating that the stock price may fall from the close of $0.57 to the range of $0.66 to $0.68 over 39 days, according to the standard principles of technical analysis.
Signs from China were mixed this week, with steel demand on the rise, a positive sign for the world’s second-largest economy. However, other indicators like industrial production and house prices are lagging. Meanwhile, the ASX saw a modest gain this week, thanks to strong performances in utilities, financials, and consumer discretionary stocks.
In this week’s wrap, Grady covers:
- (0:10): global market movements this week
- (1:03): industrial production in China
- (2:03): the impact of China’s outlook on global markets
- (3:40): the best & worst performing stocks on the ASX200
- (4:28): the most traded stocks by Bell Direct clients
- (4:54): economic data to watch out for.
Wall Street was closed on Wednesday for the Juneteenth holiday which is the National Independence Day celebrated on the 19th of June every year. Investors will be eagerly awaiting the opening of trade in the US on Thursday though to see if Nvidia, and the Nasdaq and S&P500 as a whole are able to maintain their respective record runs.
In Europe overnight, markets in the region closed slightly lower aside from the FTSE100 after UK inflation data came in at 2% for May which is inline with the Bank of England’s target. The STOXX600 fell 0.18% on Wednesday, Germany’s DAX fell 0.1% and the French CAC fell 0.77%. UK inflation for May hitting the BOE’s target rate of 2% ahead of Thursday’s policy rate decision is timely despite economists’ expecting the BOE to maintain the current rate of 5.25% for the month ahead before cutting in August.
Across the Asia markets on Wednesday, it was a sea of green as energy stocks boosted markets to a positive close. Hong Kong’s Hang Seng rose 2% on Wednesday, and Taiwan’s weighted index topped a record over 23,000 for the first time. Japan’s trade data for May also out yesterday showed exports grew 13.5% YoY while imports grew 9.5%, with exports topping economists’ expectations while imports fell slightly short.
What to watch today:
- Locally on Wednesday, the ASX200 pulled back in afternoon trade to close 0.1% lower as a sell-off in industrials and telecom stocks offset gains among energy and consumer staples companies.
- A nuclear power plant promise from Federal Opposition leader Peter Dutton as part of his election push boosted uranium miners yesterday with Paladin ending the day up 1.11%, Boss Energy climbing 2.2% and Deep Yellow adding 4.21%.
- Mortgage insurer, Helia, tanked 20.85% yesterday on news that CBA, Helia’s biggest client, will potentially put its contract up for tender. This fall in share price saw Helia lose almost a fifth of its market value yesterday.
- Ahead of Thursday’s session on the ASX, the SPI futures are expecting the local market to open the day down 0.23%, extending on the midweek losses.
- On the commodities front this morning, oil is trading down 0.28% at US$81.34/barrel, gold is up 0.08% at US$2330.28/ounce and iron ore is up just 0.06% at US$107.11/tonne.
- 1 Aussie dollar is buying 67 US cents, 105.40 Japanese Yen, 52.43 British Pence and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Bell Potter has maintained a buy rating on Beach Energy (ASX:BPT) and slightly decreased the 12-month price target on the energy exploration and development company following the release of the company’s strategic review including further cost reductions, more disciplined capital management and growth focus on three core producing energy hubs.
- Trading Central has identified a bullish signal on OM Holdings (ASX:OMH) following the formation of a pattern over a period of 27-days which is roughly the same amount of time the share price may rise from the close of $0.46 to the range of $0.62 to $0.66 according to standard principles of technical analysis.
Wall Street started the new trading week in record territory for the Nasdaq and S&P500 driven by market optimism around the AI movement and ahead of the Fed officials’ speeches later this week which could shine light on the rate cut outlook. The S&P500 ended the day up 0.77% at a record high 5473.23 points, while the Nasdaq soared to a close up 0.95% at 17,857.02 and the Dow added 0.5% to close at 38,778 snapping a four-session losing streak.
European markets closely mostly higher on Monday despite instability on a political front across a number of regions and against a clouded economic backdrop leaving investors questioning the direction of rate and inflation outlook across Europe. The STOXX600 rose 0.12% on Monday, while France’s CAC returned to positive territory ending the day up 0.9% after mixed reactions to the possibility of a political victory for the country’s far-right national party in the country’s upcoming election. In Germany the DAX rose 0.37% on Monday and, in the UK, the FTSE100 ended the down just 0.06%.
The Asia region it was all eyes on China yesterday with a slew of economic data painting a mixed economic picture out of the world’s second-largest economy’s recovery post-pandemic. China’s CSI index fell 0.15% on Monday, while Japan’s Nikkei tumbled 1.83% on a slide in energy stocks, and South Korea’s Kospi index fell 0.52% at the closing bell.
Locally on Monday, the ASX200 started the new trading week down 0.31% as a sell-off in tech and energy stocks weighed on the key index. Disappointing economic data out of China weighed on investor sentiment around the big miners yesterday while investors also fled tech stocks around concerns over the outlook of interest rates which will be announced by the RBA later this afternoon.
ANZ-Indeed data out yesterday showed Australian job advertisements fell 2.1% in May which at first glance appears supportive of a slight loosening of the country’s tight labour market, however, this slight decline keeps the job ads data 20% above pre-pandemic levels indicating the labour market remains tight, especially following the nation’s unemployment rate falling to 4% in data out last week.
What to watch today:
- Gold miners rallied yesterday on a rise in the price of the precious commodity as investors hold high hopes that the Fed will cut rates soon.
- Shares in wagering giant Tabcorp rallied on Monday after the company announced former AFL CEO, Gillon McLachlan will step in as Tab’s new Chief Executive from early August.
-
On the commodities front this morning, oil is trading 2.61% higher at US$80.48/barrel, gold is down just over half a percent at US$2320/ounce and iron ore is up just 0.2% at US$107.33/tonne.
- Iron ore prices have jumped overnight after China’s crude steel demand jumped 8.1% in May from April indicating recovering demand in the world’s second largest economy which is a much-needed boost to the outlook for exports from Australia’s biggest iron ore miners. While this was a key step forward for the country’s post-pandemic recovery, China’s new home price data also out yesterday indicated new home prices fell at the fastest pace in more than 9 years in May, painting a further dire picture of the economy’s struggling property sector.
- Taking a look at the Aussie dollar, 1 AUD is buying 66 US cents, 104.31 Japanese Yen, 52.05 British Pence and 1 New Zealand dollar and 8 cents.
- The highly anticipated RBA rate announcement will be handed down this afternoon where it is widely expected Australia’s central bank will maintain the current cash rate of 4.35% for the next period, however, we are likely to see investors and markets react to commentary out of the RBA that indicates the rate outlook and a timeline to cuts.
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open the day up 0.38% tracking Wall Street’s rall
It was a big week on Wall Street last week with the Nasdaq pushing to a fifth straight record close on Friday while the S&P 500 dipped just 0.04% at the closing bell and the Dow fell 0.15% on Friday. Consumer sentiment in the U.S. fell to 65.6 points in June which was below the expectations of 71.5 points and indicates consumers are concerned about economic conditions amid the high interest rate environment. For the week, the Nasdaq and S&P500 rose 3.2% and 1.6% respectively on the back of cooling inflation indicators in the form of weaker CPI and PPI than economists were expecting.
Over in Europe on Friday the same positive sentiment couldn’t be shared as markets in the region closed lower amid government speculations especially out of France. The STOXX600 fell 0.95% on Friday while Germany’s DAX lost 1.44%, the French CAC fell 2.66% and, in the UK, the FTSE100 ended the day down 0.21%.
Asia markets closed mixed on Friday led by Japan’s Nikkei closing 0.24% higher after the bank of Japan kept its benchmark interest rate steady at 0% to 0.1% for the month ahead but signalled it is considering the reduction of its purchase of Japanese government bonds.
What to watch today:
- Locally on Friday the ASX200 closed 0.33% as every sector aside from consumer discretionary and healthcare closed in the red which pushed the local market to a 1.25% decline for the week. A widespread decline in commodity prices weighed on the miners late last week while the key index as a whole had its worst week since mid-April last week amid a widespread sell-off across the board in equities.
- Resouro Strategic Metals renewed investor appetite for rare earths miners through a very successful debut on the ASX on Friday as shares in the Brazilian rare earths project miner soared 37% on debut.
- On the commodities front this morning, oil is trading 0.07% higher at US$78.51/barrel, gold is down 0.06% at US$2330/ounce, iron ore is up 0.2% at US$107.33/tonne and uranium is up 0.76% at US$86.65/pound.
- 1 Aussie dollar is buying 66 US cents, 104.12 Japanese Yen, 52.21 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the first trading session of the new week here in Australia the SPI futures are anticipating the ASX to open the day down 0.22% ahead of the RBA’s rate decision out tomorrow where it is widely expected that the RBA maintain the current cash rate of 4.35% as key inflation drivers including services, wages and housing inflation remain stubbornly high.
Trading Ideas:
- Bell Potter increased the 12-month price target on Wisetech Global (ASX:WTC) from $92.75 per share to $100 per share and maintain a hold rating on the leading global logistics software company following a recent update on the company’s six CargoWise product development priorities and the larger market opportunities in the Landside logistics and Customs markets.
- Trading Central has identified a bullish signal on Super Retail Group (ASX:SUL) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may rise from the close of $13.38 to the range of $14.10 to $14.30 according to standard principles of technical analysis.
French election jitters threaten to rattle markets, while US tech giants advance. In this week’s wrap, discover how inflation data, global events and hot ASX sectors are shaping the investment landscape this week.
In this week’s wrap, Sophia covers:
- (0:11) key US economic data moving markets
- (0:28) concerns surrounding the French election
- (1:36) what to expect from the Bank of Japan’s meeting
- (1:50) this week’s corporate news roundup
- (2:29) the ASX200 top performers
- (3:43) the most traded stocks by Bell Direct clients
- (4:10) next week’s economic calendar.
US markets advanced overnight after the Fed chairman Jerome Powell stated that policymakers want to see more progress on inflation ahead of a decision to lower rates. US May CPI data also showed inflation continuing to cool, which lifted the market’s expectations that the Federal Reserve will pivo to rate cuts as early as September.
It was a strong session on Wall Street with the S&P500 gained 0.85%, closing above 5,400 for the first time. The Nasdaq also hit an all-time high, up 1.53%, while the Dow Jones was the outlier, closing down slightly by 0.09%.
What to watch today:
- Following US markets, the SPI futures are suggesting the Australian market will rise 0.67% at the open this morning.
- In economic data, Westpac’s consumer confidence data for June is out at 11:30am today and the unemployment rate for May is out at 12:30pm AEST, forecast to rise to 4.2%.
- In commodities,
- Oil is up 0.65% to US$78.40 per barrel, due up an unexpected increase in US crude stocks. So keep watch of ASX listed energy producers today.
- Gold is also in the green at US$2,322.76 per ounce.
- And iron ore is down more than 1% at US$106.27 per tonne, the lowest in two months, due to pessimistic demand expectations for China.
Trading Ideas:
- Trading Central have identified a bullish signal in Regis Healthcare (ASX:REG) indicating that the stock price may rise from the close of $4.09 to the range of $4.37 to $4.47 over 43 days, according to the standard principles of technical analysis.
- Meanwhile Trading Central is bearish on South32 (ASX:S32), indicating that the stock price may fall from the close of $3.64.
Wall St closed mixed on Tuesday as the Nasdaq closed at fresh highs and investors await for important inflation data. The Dow Jones fell 0.31%, the S&P500 closed 0.27% higher and the tech-heavy Nasdaq ended the trading session 0.88% higher as Apple gained 7%, now trading at an all-time high.
Over in Europe, markets closed lower as the focus turns towards the Federal Reserve’s next meeting and important inflation data coming out of the US. The STOXX 600 fell 0.9% with all major sectors ending the trading session in the red with losses led by banks which fell 2.17%. Germany’s DAX lost 0.68%, the French CAC fell 1.33% and over in the UK the FTSE100 closed Tuesday’s trading session nearly 1% lower.
Locally yesterday, the ASX200 fell 1.33% with all but one major sector ending in the red. Losses were led by the materials and real estate sectors which fell 2.58% and 2.35% respectively. This was offset by the consumer discretionary sector which rose 0.11% yesterday.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.46% at market open this morning.
- In terms of economic data, important US inflation data will be released later on tonight for core inflation month on month with a consensus and forecast of 0.3%.
-
On the commodities front this morning,
- Oil is trading 0.38% higher at 78 US dollars and 3 cents a barrel, gold is trading 0.29% higher at 2316 US dollars an ounce and iron ore is trading 1% lower at 107 US dollars and 38 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Electro Optic Systems (ASX:EOS), despite downgrading its 12-month price target to $2.10. The buy rating is maintained by Bell Potter as it is estimated that EOS will generate $70.3m in revenue for CY24 and assuming an EBITDA margin of around 29%, this implies an underlying EBITDA of $20.4m. The $2.10 price target remains a greater than 15% premium to the current share price, hence the buy rating is maintained.
- Trading Central has identified a bearish signal on Stockland Corp (ASX:SGP), indicating that the stock price may fall from the close of $4.47 to the range of $4.04-$4.12, on a pattern formed over 12 days, according to the standard principles of technical analysis.
Wall St closed higher overnight as investors await the Federal Reserve’s interest rate decision. The Dow Jones rose 0.18%, the S&P500 rallied 0.26% and the tech-heavy Nasdaq ended the trading session 0.35% in the green.
Over in Europe, markets closed lower as traders react to initial results from the EU Parliament elections. The STOXX600 closed 0.27% lower with losses led by food and beverage stocks which fell 1.27%. Germany’s DAX fell 0.34%, the French CAC lost 1.35% and over in the UK the FTSE 100 ended Monday’s trading session 0.2% in the red.
Locally, the ASX200 was closed yesterday for the King’s birthday public holiday, however on Friday the ASX200 rose nearly half a percent higher with all but one major sectors trading higher. Gains were led by the consumer discretionary and the materials sectors which rose 1.19% and 0.76% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures predicting a fall of 0.42% at market open this morning.
- On the commodities front this morning,
- Oil is trading 3.57% higher at 78 US dollars and 23 cents a barrel, with the significant rise fuelled by expectations of increased summer fuel demand.
- Gold is trading 0.78% higher at 2310 US dollars an ounce as traders awaits the upcoming monetary policy decision.
- And iron ore is trading 0.02% lower at 108 US dollars and 48 cents a tonne.
Trading Idea:
- Trading Central has identified a bullish signal on Adairs Limited (ASX:ADH), indicating that the stock price may rise from the close of $1.74 to the range of $2.50-$2.65 on a pattern formed over 52 days, according to the standard principles of technical analysis.
Global markets posted gains in May, particularly in the US with the S&P500 and Nasdaq rising significantly. However, signs of a US economic slowdown, including cooling inflation and lower growth, suggest a potential rate cut by the Federal Reserve as early as July. Europe is also expected to cut rates due to moderate inflation.
China showed economic weakness with declining manufacturing activity. Oil prices fell while copper remained stable but is expected to rise. The US's performance is crucial for the global economic outlook, and investors should maintain a diversified and adaptable portfolio.
In this week’s wrap: Sophia covers:
- (0:11) how global markets performed in May
- (1:57) trends in the commodity market
- (2:29) the global economic outlook
- (3:43) the most trades stocks & ETFs by Bell Direct clients
- (4:14) economic data to watch next week.
A rally for the major tech stocks and optimistic rate cut outlook boosted the New York Stock Exchange to a green close overnight with the S&P 500 and Nasdaq advanced 1.2% and 1.96% respectively to post fresh record closes, while the Dow Jones ended the session up 0.25%. JOLTs Job Openings data for April, also released overnight, added to the improved investor sentiment as the reading came in at a decline to 8.059m jobs in April from 8.355m jobs in March which indicates further easing of the tight labour market in the US.
Tech darling Nvidia rose 5% to reach a fresh record high and a US$3tn market cap on Wednesday after the chipmaking giant unveiled new chips to start the week.
In Europe overnight markets reversed Tuesday’s losses to close higher on Wednesday ahead of the European Central Bank’s rate decision out on Thursday. The STOXX600 rose 0.84% driven by a rally for tech stocks, while mining stocks again weighed on gains with a fall of 0.5%. Germany’s DAX rose 0.93% on Wednesday, the French CAC added 0.87%, and, in the UK, the FTSE100 gained 0.18% at the closing bell.
Markets across Asia closed mixed on Wednesday as India’s Nifty 50 Index rebounded from Tuesday’s tumble to close 1.98% higher, while Japan’s Nikkei fell 0.89% and Hong Kong’s Hang Seng was little unchanged with a 0.06% decline at close.
What to watch today:
- Locally the midweek session ended 0.41% higher as broad market gains offset weakness among commodity prices and mining stocks overnight on Tuesday. The local rally also took lead from Wall street’s gains on Tuesday and Australia’s GDP data indicating softer economic growth than economists’ anticipated in the first quarter.
- Treasury Wine Estates rose 6.1% on Wednesday after the company reaffirmed FY24 guidance ahead of its USA investor presentation.
- Medibank shares dipped 1.2% on Wednesday after Australia’s privacy watchdog, the AIC, announced it will take legal action against the healthcare insurer for failing to safely and securely protect the medical details of 9.7m Australians during a cyberattack experienced in 2022, with fines from the watchdog potentially topping $21.5tn.
- The Australian economy grew at a rate of just 0.1% in Q1 which was fell below economists’ forecasts and the last quarters’ reading of 0.2% growth, indicating inflationary pressures are continuing to eat away at Australia’s economic stability and expansion. The 0.1% expansion reported in Q1 was the softest growth rate in 6 quarters and driven by subdued domestic demand, and fixed investment falling further.
- Investors will likely react to the release of Australia’s trade balance data out today at 11:30am Eastern time with the expectation of a slight rise in Australia’s trade surplus from March’s $5.024bn to $5.50bn indicating a rebound in exports compared to imports where exports have been declining since November.
- Ahead of Thursday’s trading session the SPI futures are expecting the ASX to open the second last trading session of the week up 0.54% tracking Wall Street’s record-closing rally overnight.
- On the commodities front this morning, oil has recovered some ground to trade 1.4% higher at US$74.28/barrel, gold is up 1.14% at US$2355/ounce and iron ore is down 2.19% at US$107.69/tonne.
- 1 Aussie dollar is buying 66 US cents, 103.77 Japanese yen, 51.97 British pence and 1 New Zealand dollar and 7 cents.
Trading Idea:
- Bell Potter has increased the rating on Infomedia (ASX:IFM) from a hold to a buy and have increased the 12-month price target on the leading provider of software solutions to the automotive industry after the company presented twice last week indicating this financial year is tracking to plan and the outlook is perhaps better than Bell Potter expected.
Wall Street closed higher on Tuesday across the key indices amid a decline in treasury yields and ahead of key jobs data out on Friday. The Dow Jones rose 0.36%, the S&P500 added 0.15% and the tech-heavy Nasdaq climbed 0.17% on Tuesday. Investors are eagerly awaiting the release of key nonfarm payrolls data out on Friday for the month of May with hopes of an ease in the number of people currently employed in the US to support the Fed’s interest rate cut outlook, but not a major decline as that would spark recession fears.
In Europe overnight, markets closed lower across the region as investors await the European Central Bank’s rate decision out on Thursday to see if the inflation print for the region that came in hotter-than-expected last Friday, deters the ECB from cutting rates as is widely expected. The STOXX600 fell 0.5% as mining stocks weighed on the bourse, while Germany’s DAX fell 1.09%, the French CAC lost 0.75% and, in the UK, the FTSE100 ended the day down 0.37%.
Across the Asia markets on Tuesday, India’s stock market tumbled 5% as the country continued voting for its 2024 election, while Hong Kong’s Hang Seng rose 0.12% on Tuesday, South Korea’s Kospi index shed 0.76% and Japan’s Nikkei ended the day down 0.22%.
Weakened commodity prices and a mixed session in the US on Monday caused the ASX to reverse Monday’s gains to post a 0.31% decline on Tuesday. A sharp slide energy stocks weighed on the local bourse following the 3.75% drop in the price of oil on Tuesday as the markets digested OPEC+’s further production cut announcement, while financials stocks closed 0.23% higher to offset some of the heavy losses.
A positive crop outlook forecast from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) fuelled a rally for some agriculture stocks yesterday including GrainCorp which climbed 4.8%. The report detailed national winter crop production is set to increase to 51.3m tonnes which is a 9% increase on the last financial year.
Gold miners also climbed again on Tuesday amid a rise in the price of the precious commodity driven by rate cut outlook in the US.
What to watch today:
- All eyes locally will be on the release of Australia’s GDP growth rate data for Q1 which is released today at 11:30am with economists expecting a second consecutive reading of 0.2% growth, which would reflect softer economic growth. Australia’s trade balance data for April is also out on Thursday with the forecast of the country’s trade surplus to improve slightly to $5.5bn from $5.024bn in March.
- On the commodities front this morning oil is trading a further 1.78% lower at US$72.89/barrel, gold is down just over 1% at US$2326.86/ounce and iron ore is down a steep 6.31% at US$110.10/tonne.
- The Aussie dollar has slightly weakened overnight to buy 66 US cents, 102.88 Japanese Yen, 51.98 British Pence and 1 New Zealand dollar and 8 cents.
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day down just 0.06%.
Trading Ideas:
- Bell Potter has maintained a buy rating on GrainCorp (ASX:GNC) and raised the 12-month price target from $9.50 to $9.90 following the release of the ABARE June east crop forecast report surprising to the upside. The ABARE forecast implies another strong cropping outcome for GrainCorp in FY25 with the initial June forecast implying the fifth largest crop on record.
- Bell Potter has maintained a hold rating on Synlait Milk (ASX:SM1) and decreased the 12-month price target from $0.66 to $0.47 after the milk processing company released a further FY24 update downgrading FY24 EBITDA expectations to the lower end of guidance reflecting lower ingredients values and inventory impairments.
US equities closed mixed overnight. The Dow Jones slid over 100 points or 0.3% to close the first trading session for June, while the S&P500 and the Nasdaq closed in the green, up 0.1% and 0.56% respectively. Weighing on the Dow was the release of weak manufacturing data in the US, which saw a pullback in banks, industrials and shares dependent on economic growth.
The local market started the new trading month in positive territory yesterday, after a red run last week as the financial and utilities stocks boosted the market to a green close. Tech and communications services stocks weighed on the market gains, with the rate sensitive tech sector ending Monday’s session down 0.7%. Our local rally on Monday followed momentum from Wall Street on Friday, as the US core personal expenditure data, which is the Fed’s preferred measure of inflation, increased just 0.2% for April, the slowest rate this year, indicating inflationary pressures in the world’s largest economy are beginning to ease.
What to watch today:
- The Australian market is set to open lower this morning, with the SPI futures suggesting a 0.15% fall at the open.
- In commodities,
- The iron ore price hit a six-week low however the big iron ore miners in Australia posted notable gains on Monday, seemingly unaffected by the drop in the price of their major commodity. BHP, Fortescue and Champion Iron all posted gains yesterday.
- The drop in the iron ore price was due to ongoing weakness in China’s housing market as indicated by the release of new-home sales economic data. Despite weakness in China’s property sector, the world’s second largest economy reported expansion in its manufacturing sector as activity in the manufacturing space increased at its fastest rate in almost 2-years for May, in a positive sign of slow economic recovery post-pandemic in the region.
- Energy stocks also rallied in the aftermath of the OPEC+ meeting, where the global oil regulator further cut production outputs in an attempt to bolster the price of oil.
- This morning, oil is trading 3.88% lower at US$74 per barrel as markets digested OPEC+’s latest move, while gold is up more than 1% at US$2,350 an ounce and iron ore is down 0.1% at US$117.52 per tonne.
- And the Australian dollar is buying US$0.67, 104.27 Japanese Yen, 52.16 British Pence, and NZ$1.08.
Trading Ideas:
- Bell Potter maintains a Speculative Buy rating on AMA Group (ASX:AMA), the largest accident repair group in Australia with approximately 127 vehicle repair shops. Bell Potter’s key focus for the company this half has been the refinancing of AMA’s senior debt facility which matures in October this year. They have lowered their valuation from $0.12 to $0.08, and at the company’s current price of $0.04, this implies 86% share price growth in a year.
- And Trading Central has identified a bullish signal in BHP Group (ASX:BHP), indicating that the stock price may rise from the close of $44.81 to the range of $48.30 to $49.10 over 8 days according to the standard principles of technical analysis.
Wall St closed higher on Friday as the Dow Jones posted its best day in 2024. The Dow gained 1.52%, the S&P500 rose 0.8% whilst the tech-heavy Nasdaq fell 0.01% to end the trading week.
Over in Europe, markets closed higher to end the month as investors await a rate decision from the European Central Bank. The STOXX600 closed the week 0.28% higher with most sectors closing the week off in the green with utilities jumping over 1% whilst tech fell 1.48%. Germany’s DAX remained flat on Friday, the French CAC gained 0.18% and over in the UK the FTSE100 rose over half a percent.
On the economic data front, Euro Zone inflation rose 2.6% in May, 0.1% higher than the analysts prediction of 2.5%.
Locally on Friday, the ASX200 rose nearly one percent with all but one major sector ending the trading session in the green. Gains were led by the consumer staples and energy sectors which rose 1.91% and 1.77% respectively. This was slightly offset by the real estate sector which fell 0.21% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.49% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.94% lower at 77 US dollars and 18 cents a barrel as US stockpiles rose by 2 million barrels last week, despite forecasts for a 400,000-barrel draw, indicating week demand.
- Gold is trading 0.72% lower at 2327 US dollars an ounce and iron ore is trading 0.09% lower at 117 US dollars and 52 cents a tonne.
Trading Ideas:
- Bell Potter has upgraded its rating of Brickworks (ASX:BKW) to a buy and has a 12-month price target of $29.50. The buy rating is maintained by Bell Potter as it is their opinion that the biggest driver of value in the BKW valuation is the company’s 26% shareholding in Washington H. Soul. Pattinson which is estimated to be around 50% of the current enterprise value of the business. Bell Potter’s market valuation on SOL shows a 3.6% discount, hence the rating has been upgraded to a buy.
- Trading Central has identified a bullish signal on NRW Holdings (ASX:NWH), indicating the stock price may rise from the close of $3.08 to the range of $3.28-$3.34, on a pattern formed over 25 days, according to the standard principles of technical analysis.
Grady sits down with Bell Potter analyst, Regan Burrows following his exciting trip to Namibia in West Africa to explore the very mining sites he covers in his research including Paladin Energy and Boss Energy. Watch the video as Regan unveils all the latest mining insights he uncovered whilst on this once in a lifetime experience.
In this week’s wrap, Grady covers:
- (2:18) why Paladin Energy has been downgraded
- (3:30) uranium being the standout commodity of 2024
- (4:53) Boss Energy being Bell Potter’s key pick
- (8:15) Australia and the global commodity cycle
- (11:29) the most traded stocks & ETFs by Bell Direct clients
- (11:59) economic data to watch next week.
Wall St closed lower overnight as traders start to look ahead to the release of key US inflation data. The Dow Jones fell 0.86%, the S&P 500 closed 0.6% lower and the tech-heavy Nasdaq dropped over 1%. In terms of economic data, GDP growth data quarter on quarter was released, coming in at 1.3%, 0.3% lower than the forecast of 1.6%.
In terms of US stocks, Salesforce had its worst session since 2004, dropping 19.7% after missing revenue expectations for the fiscal quarter and providing a week outlook.
Over in Europe, markets closed higher overnight despite gloomy global sentiment. The STOXX600 ended the trading day 0.63% higher with most sectors closing in the green including telecom stocks which rose 1.6%. Germany’s Dax rallied 0.13%, the French CAC closed over half a percent higher and over in the UK the FTSE100 ended Thursdays trading session 0.59% in the green.
Locally yesterday, the ASX200 ended the day falling nearly half a percent, led by the materials and utilities sectors which fell 1.86% and 1.43% respectively. This was offset by the consumer discretionary sector which gained 0.74% by the closing bell yesterday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.65% by market open this morning.
-
In terms of economic data,
- US core inflation data month on month for April is to be released on Friday with a consensus of 0.3%, the same as its previous period.
-
On the commodities from this morning,
-
Oil is trading 1.74% lower at 77 US dollars and 85 cents a barrel as markets assessed fresh data ahead of the OPEC+ meeting this weekend.
- Gold is trading 0.21% higher at 2343 US dollars an ounce and iron ore is trading 0.05% higher at 117 US dollars and 74 cents a tonne.
Trading Idea:
- Bell Potter maintains a speculative buy rating on HighCom Limited (ASX:HCL) and has an unchanged valuation of $0.35. The speculative buy rating is maintained by Bell Potter as HCL expects FY24 revenue to be between $46m-$48m, which would imply second half of 2024 revenue of $31.1m-$33.1m which would be a significant improvement on the first half of 2024 result, hence the speculative buy rating is maintained.
Wall St closed lower overnight following pressure from rising Treasury Yields outweighed a rally by AI company Nvidia. The Dow Jones closed over 1% lower, the S&P500 fell 0.74% and the tech-heavy Nasdaq ended Wednesday’s trading session 0.58% in the red.
In terms of US stocks, Nvidia rose 0.8%, having risen every single trading session since its earnings report last Wednesday.
Over in Europe, markets closed lower with the STOXX600 having its worst session since mid-April, falling over 1%. All sectors ended the trading day negative with losses led by mining stocks down 2.12%. Germany’s DAX closed 1.1% lower, the French CAC dropped 1.5% and over in the UK the FTSE100 ended 0.86% in the red.
Locally yesterday, the ASX200 closed 1.3% lower with all major sectors ending the day in the red. Losses were led by the consumer staples and industrial sectors which fell 2.08% and 1.87% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.68% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.38% lower at US$79.17/barrel due to concerns over weak US gasoline demand.
- Gold is trading 0.93% lower at US$2337/ounce as investors continue to reduce bets on US Fed rate cuts this year.
- And iron ore is trading flat at US$117.68/tonne.
Trading Ideas:
- Trading Central has identified a bearish signal on NAB (ASX:NAB), indicating that the stock price may fall from the close of $33.65 to the range of $31.10-$31.60 on a pattern formed over 70 days, according to the standard principles of technical analysis.
- And Trading Central has also identified a bearish signal on Steadfast Group (ASX:SDF), indicating that the stock price may fall from the close $5.46 to the range of $4.99-$5.09 on a pattern formed over 65 days, according to the standard principles of technical analysis.
The US Market is closed overnight for the Memorial Day holiday and will resume trading on Tuesday US time; however, it is expected the rally will continue from last week as investors shrugged off inflation concerns on Friday in favour of market optimism from Nvidia’s latest stellar results indicating earnings inflation over the next quarter. The futures market is trading higher across the key indices on Monday.
Over in Europe on Monday, it was a quiet day for markets as the UK market was also closed for the late May bank holiday. Elsewhere in Europe, markets closed slightly higher to start the new trading week as investors continue searching for clues as to when the European Central Bank may cut interest rates. The STOXX600 rose 0.28%, while Germany’s DAX and the French CAC each added 0.4% on Monday.
The Asia markets also closed higher on Monday to start a data-heavy trading week in positive territory. China’s industrial profits rose 4.3% year-on-year from January to April which boosted markets on Monday in a sign the world’s second largest economy is making small yet material steps in the right economic recovery direction. China’s CSI index rose 0.95% on the back of this data release, while Hong Kong’s Hang Seng rallied 1.2% and South Korea’s Kospi Index climbed 1.32%.
The local market started the week in positive territory closing Monday’s session up 0.8%, overcoming last week’s inflation-driven sell-off, led by the real estate stocks rising 1.6% and telecoms stocks rallying 1.3%. The sell-off last week was driven by hotter-than-expected inflation driver data released in the US which pushed back investor hopes of rate cuts. Energy stocks came under pressure on Monday as the price of oil dipped to a near three-month low amid demand concerns out of the world’s largest oil demand market, the US.
Neuren Pharmaceuticals soared over 15% yesterday after the company resumed trading following a halt on the release of Phase 2 trial results showing significant improvement in Pitt Hopkins syndrome including key aspects of communication, social interaction, cognition, and motor abilities.
Lendlease was another stand out on the local bourse yesterday rising almost 10% after the company revealed a strategic review to its global strategy, while online luxury fashion platform Cettire also soared over 10% after ‘categorically rejecting’ allegations that customers purchased counterfeit products from its site.
What to watch today:
- Ahead of Tuesday’s trading session here in Australia, the SPI futures are expecting the ASX to open the day up 0.2% or 16 points to extend the rally of this week into another trading day.
- On the commodities front this morning oil is trading 1.08% higher at US$78.56/barrel, gold is up 0.84% at US$2353.01/ounce, and iron ore is up 0.11% at US$117.66/tonne.
- 1 Aussie dollar is buying 67 US cents, 104.40 Japanese Yen, 52.09 British Pence and 1 New Zealand dollar and 8 cents.
Trading Ideas:
- Bell Potter has maintained a buy rating on Neuren Pharmaceuticals (ASX:NEU) and has raised the 12-month price target from $26.50 to $28.00 on the neuro-developmental targeted pharmaceuticals developer following the release of the company’s Phase 2 trials results showing a second positive read out for its drug candidate NNZ-2591 in Pitt Hopkins Syndrome. Bell Potter sees the value in the company’s second drug candidate represents a similar, if not larger market opportunity than Rett Syndrome which Neuren’s Daybue drug is on the market treating at present.
- Trading Central has identified a bearish signal on Hub24 (ASX:HUB) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may fall from the close of $41.53 to the range of $38.10 to $38.80 according to standard principles of technical analysis.
Wall Street closed higher on Friday to overcome the inflation-driven sell-off on Thursday as investors welcomed Nvidia’s latest results as a positive sign of earnings growth inflation especially in the AI sector. The Nasdaq ended Friday’s session up 1.1% at a record high of 16,920.79 points, the Dow Jones ended the day up 0.01%, and the S&P500 rose 0.7%. For the week was a mixed result across the key indices with the Dow falling 2.33%, while the S&P500 rose just 0.03%, and the Nasdaq advanced 1.41%. Nvidia’s shares climbed 2.6% on Friday to top US$1000 for the first time, as investors celebrated its stellar Q1 results including eps of $6.12/share on revenues of US$26bn, which beat analysts’ expectations, and issued guidance for Q2 of US$28bn which also came in ahead of expectations. The results boosted investor sentiment and offset any market concerns of delayed interest rate cuts out of the Fed on Friday, following the release of hotter-than-expected services and manufacturing data for May in the US released on Thursday.
Over in Europe, markets closed lower as sentiment in the region around rate cuts remains a concern. The STOXX600 fell 0.17% on Friday, Germany’s DAX closed flat, the French CAC fell 0.09%, and, in the UK, the FTSE100 ended the day down 0.26%. The Bank of England’s rate cute outlook was thrown into doubt last week after hotter-than-expected inflation data was released in the region.
Across the Asia markets on Friday, stocks fell as investors digested the latest inflation reading out of Japan and assessed rate cut outlook concerns both locally and in the U.S. Hong Kong’s Hang Seng fell 1.71%, China’s CSI 300 lost 1.11%, and Japan’s Nikkei ended the day down 1.17%. Japan’s core inflation eased to 2.2% from 2.6% in March, while the headline inflation rate slowed to 2.5% down from 2.7%.
Locally on Friday, the ASX200 fell 1.1% as Wall Street’s tumble on Thursday reignited local investor concerns of a prolonged rate cut outlook, which sent rate-sensitive sectors sliding on Friday including technology, retail and banking stocks. Australian government bonds rose on Friday as investors turned to safe-haven investments on uncertain rate cut outlook.
Investors took profits from the big banks on Friday with CBA falling 2%, NAB sliding 1.5%, ANZ losing 0.95% and Westpac ending the day down 1.15%.
Regional Express is expanding its competitive share of Australia’s domestic market as the airline announced on Friday that it is launching flights from Perth to Melbourne starting next month. Investors sold out of the airline’s shares over concerns its domestic expansion will hurt its regional network dominance.
What to watch today:
- Ahead of the first trading session of the new trading week, the SPI futures are anticipating the ASX to open up 0.61% following Wall Street’s rally on Friday.
- On the commodities front this morning, oil is down 0.06% at US$77.75/barrel, gold is up just 0.03% at US$2334/ounce, iron ore is up 0.11% at US$117.66/tonne and uranium is down 0.11% at US$91.65/pound.
- AU$1.00 dollar is buying US$0.66, 104.09 Japanese Yen, 52.04 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on Paladin Energy (ASX:PDN) from a buy to a hold and have decreased the 12-month price target on the uranium miner from $16.50 to $15.70 after Bell Potter’s resources analyst visited the company’s Langer Heinrich Mine in Namibia. The team were surprised by the quality of the site and regional infrastructure competency however are cautious about operation costs which seem to be the biggest downside risk at this point. Bell Potter also noted that the upcoming November election in the region carries key risks around the potential for an introduction of a government free-carry interest and/or an increase in mining taxes in the region.
- And Trading Central has identified a bearish signal on TPG Tele
Embark on a journey of discovery with Dr. Alan as he unveils the cutting-edge breakthroughs of Clarity Pharma, a pioneering force in the relentless fight against cancer through next-generation radiopharmaceuticals. In this instalment of our From the helm series, Bell Direct’s Grady Wulff speaks to Clarity Pharmaceuticals (ASX:CU6) Executive Chairman, Dr Alan Taylor.
Clarity Pharmaceuticals specialises in the development of Targeted Copper Theragnostic for the imaging and treatment of selected cancers. Clarity Pharma has an extensive program of clinical development for imaging and cancer therapy with a series of important data readouts over the next few years.
In this video Dr. Alan discusses:
- (1:27) An overview of the company, including their 7 clinical trials
- (3:35) The promising results from their SECuRE trial
- (11:55) Why the radiopharmaceutical market is booming
- (14:47) Why Clarity Pharma could be an investment opportunity
Wall St closed lower overnight as the minutes from the Federal Reserve’s May meeting raised investor concerns of persistent inflation, displaying the central bank may not cut rates anytime soon. The Dow Jones fell over half a percent, the S&P500 lowered 0.27% and the tech-heavy Nasdaq ended the trading session down 0.18%.
Over in Europe, markets followed Wall St, ending Wednesdays trading session lower. The STOXX600 fell 0.37% with all sectors ending in the red. Losses were led with autos stocks which dropped 1.3% and oil and gas stocks declining 1.2%. Germany’s DAX lost 0.25%, the French CAC closed 0.61% lower and over in the UK the FTSE100 fell 0.55%.
Locally yesterday, the ASX200 ended Wednesday’s trading session marginally lower, down 0.05%. Losses were led by the communication services and consumer discretionary sectors which fell 2.54% and 1.37% respectively. This was offset by the utilities sector which rallied 0.9% yesterday.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.94% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.79% lower at US$77.25/barrel following a surprise rise in US crude stockpiles of 1.825 million barrels last week.
- Gold is trading 1.77% lower at US$2378/ounce and iron ore is trading 0.28% higher at US$117.57/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on MedAdvisor (ASX:MDR) and has increased its 12-month price target to $0.49. The buy rating is maintained by Bell Potter following the release of a positive trading update including revenue levels of $120m-$123m, implying 22% to 26% growth on the prior corresponding period and an EBITDA of $6.8m-$7.6m following a loss of $3m in its prior corresponding period. This has increased revenue forecasts in FY24/25/26, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Computhershare (ASX:CPU), indicating that the stock price may rise from the close of $26.97 to the range of $34.25-$36, on a pattern formed over 478 days, according to the standard principles of technical analysis.
Wall Street ticked higher at the closing bell on Tuesday as investors anticipate the release of AI giant Nvidia to gauge how far the tech-rally and valuations can grow. The Dow Jones rose 0.17% on Tuesday, the Nasdaq added 0.22% to set a 10th all-time high this year, and the S&P500 ended the day up 0.25% to also set its 24th record close of 2024. Nvidia shares rose 0.6% prior to the release of its results which are due out on Wednesday, US time, with analysts expecting the semiconductor and AI giant to post another strong batch of results.
In Europe overnight, markets closed lower in the region ahead of the release of some key economic data later in the week including the UK inflation reading where it is widely expected to show a sharp decline in the headline inflation rate. The STOXX600 fell 0.21% on Tuesday, Germany’s DAX lost 0.22%, the French CAC fell 0.67%, and, in the UK, the FTSE100 ended the day down just 0.09%.
Across the Asia markets on Tuesday, it was a sea of red led by Hong Kong’s Hang Seng falling 2% amid declining materials and industrials stocks.
The local market overturned a recent rally to close 0.15% lower on Tuesday as communications services and materials stocks weighed on the key index, with heavy losses partially offset by a strong rally for tech stocks which took lead from the Nasdaq rising on Wall St on Monday.
Guidance and corporate updates have been dominating the market in recent sessions with building products giant James Hardie Industries tumbling 15% on Tuesday after missing guidance expectations in an update, while Sonic Healthcare weighed on the healthcare sector after its corporate update outlined currency exchange headwinds will lead to lower-than-expected profits for FY24.
Embattled casino operator Star Entertainment Group fell 8% on Tuesday after soaring on Monday amid investor concerns that rumoured takeover candidate, Hard Rock Hotels, has denied interest in acquiring the company.
Telstra shares fell 2.7% on Tuesday after the telco giant announced a series of cost cutting measures including the culling of up to 2800 jobs equating to 9% of its workforce and further expansion into AI.
The ASX is nearing record territory which has many investors questioning just how high the market can go, which is a similar concern over in the US as the Dow Jones reached a record high on Friday, however, with the recent earnings season indicating inflation on earnings, the rally still has some steam left as valuations continue rising.
What to watch today:
- Ahead of the midweek trading session in Australia, the SPI futures are anticipating the ASX to open the day up with a modest rise of 0.27%.
- On the commodities front this morning, oil is trading almost 1% lower at US$78.53/barrel, gold is down 0.3% at US$2419.5/ounce and iron ore is up 0.19% at US$117.24/tonne.
- AU$1.00 is buying US$0.67, 104.07 Japanese Yen, 52.81 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has maintained a buy rating on Technology One (ASX:TNE) and increased the 12-month price target on the leading SaaS provider from $18.50 to $19.00 following the release of the company’s 1H24 results including revenue excluding interest growing 15% to $241m which beat BPe by 1% and profit before tax rose 17%. Technology One also surprised by issuing full year guidance of 12-16% profit before tax growth which topped typical historical guidance of 10-15%.
- And Trading Central has identified a bullish signal on BHP Group (ASX:BHP) following the formation of a pattern over a period of 43-days which is roughly the same amount of time the share price may rise from the close of $46.04 to the range of $49.40 to $50.10 according to standard principles of technical analysis.
Wall St closed mixed overnight despite strong gains from some major tech companies. The Dow Jones fell 0.49%, the tech-heavy Nasdaq gained 0.65% and the S&P 500 ended the trading session 0.09% higher.
In terms of US stocks, Nvidia rose 2% as investors await for their first quarter results, due to be released on Wednesday afternoon.
Over in Europe, markets closed in the green overnight after a strong run of gains. The STOXX600 closed 0.2% higher with most of the sectors ending the trading session up with industrial stocks gaining 0.96% whilst autos fell 0.77%. Germany’s DAX and the French CAC both rallied 0.35% and over in the UK the FTSE100 rose 0.05% by market close.
Locally yesterday the ASX200 ended Monday’s trading session 0.63% in the green, with the majority of sectors finishing positive. Gains were led by the energy and materials sectors which rose 2.23% and 1.93% respectively. This was offset by the health sector which fell 0.86% by the closing bell yesterday.
In terms of local stocks yesterday, Star Entertainment group soared 22% after confirming it has received takeover offers from Hard Rock Hotels, and Australian jewellery house Michael Hill plunged almost 20% after warning of a decline in sales for FY24 compared to the prior year.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.11% by market open this morning.
-
On the commodities front this morning,
- Gold is trading half a percent higher at 2426 US dollars and 32 cents an ounce after hitting all-time highs yesterday as demand for the precious metal continues to soar, amid increased optimism for global rate cuts later this year which has impacted the USD and bond yields. This sparked a rally for local gold miners yesterday including Spartan Resources, Bellevue Gold, Northern Star Resources and Evolution Mining.
- Oil is trading 1.5% lower at 78 US dollars and 85 cents a barrel and iron ore is trading 0.15% higher at 117 US dollars and 2 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on PointsBet Holdings (ASX:PBH) and has an unchanged 12-month price target of $0.63. The buy rating is maintained by Bell Potter as PointsBet upgraded its FY24 normalised EBITDA guidance from a loss of $9-$14 million to $4-$6 million after a continued strong year-to-date trading in H2 FY24 and increased operational efficiency and productivity. This upgrade result reflects a significant improvement on the FY23 normalised EBITDA, hence the buy rating is maintained.
Wall Street closed mixed on Friday but higher across the three major averages for the week as investors welcomed softer economic data over recent weeks. The Dow Jones industrial average rose 0.34% on Friday to top 40,000 points for the first time in history which has some investors questioning how far the current rally can go, but the recent inflation on earnings outlined in many corporate results indicates the value is still there for the rally to continue. The S&P500 rose 0.12% on Friday and the Nasdaq ended the session down 0.07%. The Dow posted its 5th straight weekly gain of 1.2%, while the S&P500 and Nasdaq ended the 5 trading days up 1.5% and 2.1% respectively.
Over in Europe, markets closed lower to snap a 9-day winning streak in the region as corporate earnings weighed on investor sentiment. The STOXX600 fell 0.13%, Germany’s DAX lost 0.18%, the French CAC fell 0.26%, and, in the UK, the FTSE100 ended the day down 0.22%.
Across the Asia markets on Friday, markets closed mixed however, China’s CSI300 index rose 1% as investors welcomed the announcement out of China’s central bank for sweeping measures to boost the country’s deteriorating property market.
Locally on Friday the ASX200 closed 0.85% lower with every sector aside from materials stocks closing the day in the red, with the tech and healthcare sectors posting the greatest declines of 3.05% and 2.27% respectively. For the week though, the key index rose 0.84% led by the consumer discretionary sector soaring 3.23%. Investors took some profits on Friday after the key index closed 0.2% shy of a record high on Thursday following the unemployment rate rising to 4.1% in Australia. This data indicates rate cuts could be on the horizon out of the RBA sooner than expected as economic data continues to fall in line with RBA expectations and requirements.
Lithium miners offset some of the market losses on Friday amid forecasts for increased demand outlook of the commodity driving a rebound in the price, with Pilbara Minerals rising 2.2%, while Mineral Resources ended the day up 0.8%.
What to watch today:
- Ahead of the first trading session of the new week, the SPI futures are expecting the ASX to open Monday up 0.45%.
- On the commodities front this morning oil is trading 0.14% higher at US$80.11/barrel, gold is up 0.28% at US$2421/ounce, iron ore is up 0.15% at US$117.02/tonne, and uranium is down 0.28% at US$90.65/pound.
- AU$1.00 is buying US$0.67, 104.21 Japanese Yen, 52.91 British Pence, and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the 12-month price target on GrainCorp (ASX:GNC) from $9.20 to $9.50 and maintain a buy rating on the end-to-end grain producer following the release of the company’s the 1H24 results including NPAT coming in modestly ahead of Bell Potter’s expectations. Despite revenue falling below BP expectations, the outlook for FY24 was maintained amid a likely lift on new oilseed crush capacity.
- And Bell Potter has initiated coverage of SRG Global (ASX:SRG) with a buy rating and a price target of $1.30 amid strong short-to-medium term outlook for the leading diversified industrial services group, driven by Government-stimulated construction activity in the Infrastructure and Non-Residential sectors.
This year's Federal Budget had a clear focus on easing the cost of living burden and tackling housing affordability. Watch our latest video update to learn how it affects you.
In this week's wrap, Sophia covers:
- (0:12): surprise surplus, cost-of-living relief measures & tax cuts
- (1:37): the government's plans to tackle the housing shortage
- (2:24): what the increased Super Guarantee contribution means for you
- (2:59): the sectors leading the market this week
- (4:05): upcoming economic data to watch out for.
Wall St closed higher overnight following a lighter than expected US inflation report. The S&P 500 and tech-heavy Nasdaq closed at record highs gaining 1.17% and 1.4% respectively with the Dow Jones also rallying 0.88%. The consumer price index rose 0.3% in April which was 0.1% less than the 0.4% increase estimated by the Dow Jones.
Over in Europe, markets closed higher following the announcement of US inflation data. Germany’s DAX rose 0.82%, the French CAC climbed 0.17% and over in the UK, the FTSE100 ended the trading session 0.21% in the green.
What to watch today:
- The Australian share market is set to open higher with the SPI futures suggesting a rise of 0.64% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.12% higher at 78 US dollars and 89 cents a barrel after the Energy Information Administration report showed a 2.508 million barrel decline in US crude stocks.
- Gold is trading 1.28% higher at 2385 US dollars an ounce as the latest economic data suggests the Federal Reserve could make further rate cuts before the end of the year.
- And iron ore is trading over half a percent lower at 116 US dollars and 65 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Australian Agriculture Co. (ASC:AAC) and has a 12-month price target of $2.00. The buy rating is maintained by Bell Potter as domestic cattle prices have rebounded and remain undervalued relative to meat price indicators, in addition agricultural land and water asset values also remained robust over CY23, hence the buy rating is maintained.
- Trading Central has identified a bullish signal on G8 Education (ASX:GEM), indicating that the stock price may rise from the close of $1.25 to the range of $1.38-$1.42 on a pattern formed over 56 days according to the standard principles of technical analysis.
As we approach the close of FY24, it's a prime opportunity to review your portfolio and investment strategy for the upcoming year. Understanding the current economic landscape will be crucial in making informed decisions for FY25.
We're excited to share an insightful conversation between AMP's Deputy Chief Economist, Diana Mousina, and Bell Direct’s Market Analyst Grady Wulff. Diana and Grady discuss key factors impacting the market for the remainder of FY24 and into FY25.
In this week’s wrap, Diana and Grady delve into:
- (0:45): the impact of inflation on bond yields
- (3:49): reasons for Diana’s optimistic view on inflation’s outlook
- (5:00): how central banks can adjust interest rates independently
- (7:42): why Diana anticipates rate cuts from both local and Federal Reserve sources
- (8:39): a recap of this week’s market movements
- (9:30): the most traded stocks & ETFs by Bell Direct clients
- (10:00): upcoming economic data to keep an eye on.
Wall St closed higher overnight as the Dow Jones secures its 7th winning day up 0.85%. The S&P 500 gained over half a percent and the tech heavy Nasdaq also rallied 0.27%. In terms of US stocks, both Home Depot and Caterpillar led the Dow in Thursdays trading session, rising more than 2% each.
Over in Europe, markets closed higher as positive momentum was gained from a busy week of earnings. The STOXX600 closed 0.2% up by the closing bell with most sectors ending in the green, led by gas stocks rising 0.9%, whilst autos fell 0.9%. Germany’s DAX finished the day over 1% higher, the French CAC rallied 0.69% and over in the UK the FTSE100 ended the trading session 0.33% in the green.
Locally yesterday, the ASX200 closed 1.06% lower with the majority of sectors finishing the day in the red. Losses were led by the consumer discretionary and financial sectors which lost 2.56% and 1.71% respectively. This was offset by the energy sector which gained over half a percent by the closing bell on Thursday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.3% by market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.72% higher at US$79.52/barrel after a decline in US crude stockpiles shows a tightening supply.
- Gold is trading 1.61% higher at US$2346/ounce as strong over-the-counter market investment, consistent central bank buying and growing Asian demand all gave gold a boost.
- And iron ore is trading down 1.77% at US$116.59/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Arcadium lithium (ASX:LTM), despite slightly decreasing its 12-month price target to $9.50. The buy rating is maintained by Bell Potter as LTM provides the largest, most diversified exposure to lithium in terms of mode of upstream production, asset locations, downstream processing and customer markets. It is a key large-cap leverage to lithium prices and sentiment, which is expected to improve over the medium term. In supportive markets, LTM’s growth pipeline could see the company more than double production over the next three years, hence the buy rating is maintained.
- And Trading Central has identified a bearish signal on NAB (ASX:NAB), indicating that the stock price may fall from the close of $33.52 to the range of $31-$31.50 on a pattern formed over 56 days, according to the standard principles of technical analysis.
Wall Street closed mixed again on Wednesday as investors reacted to comments made by federal reserve officials this week signalling rates need to stay higher for longer in order to tame inflation to the target rate. The Dow Jones industrial average posted its sixth straight winning day, ending the session up 0.44% to notch the longest green streak in 2024, while the S&P500 closed just 0.03% lower and the tech-heavy Nasdaq fell 0.18%, weighed down by poor corporate earnings results. Uber shares fell 5.7% on Wednesday after the ride share giant posted an unexpected net loss and weaker-than-expected booking revenue, while Tesla shares dipped 1.7% on reports the company allegedly committed wire fraud as part of a probe into Tesla’s autopilot system, according to Reuters.
Over in Europe on Wednesday, markets extended the recent rally into the midweek session as investors continued reacting positively to key corporate earnings results. The STOXX600 rose 0.3%, Germany’s DAX added 0.37%, the French CAC climbed 0.7%, and, in the UK, the FTSE100 rose 0.5%. Siemens Energy rose 12.8% after raising its outlook for 2024. Sweden’s Bank cut the nation’s interest rates for the first time in 8 years on Wednesday in another sign of European regions digressing from U.S. lead on the rate front.
Across Asia markets on Wednesday, earnings results weighed on investor sentiment in the region which sent markets into negative territory. Japan’s Nikkei led losses with a 1.63% decline as investors responded to disappointing corporate earnings results including out of Toyota and Mitsubishi.
Locally on Wednesday, the ASX traded virtually flat all day before ending the up 0.14% to extend this week’s rally into the midweek session driven by industrial and information tech stocks rallying 0.73% and 0.6% respectively.
Perpetual confirmed it is parting ways with its high value corporate trust business to US private equity firm, KKR, for $2.18bn. On the same day, Perpetual chief executive Rob Adams announced his retirement from the global financial services organisation. This division of the business has been a key driver of Perpetual’s global success and growth in recent times which may be why investors responded so negatively on Wednesday with the share price plunging 6.95%.
Goodman Group hit a record high intra-day yesterday before investors took some profits after the industrial property company released an impressive third quarter update including upgrading FY24 earnings guidance for a second time, with the company now expecting EPS growth of 13% in FY24.
What to watch today:
- Ahead of the local trading session here today, the SPI futures are expecting the ASX to open Thursday’s session down 0.24% on global market turbulence overnight.
- AU$1.00 is buying US$0.66, 102.35 Japanese Yen, 52.57 British pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Alpha HPA (ASX:A4N) from $1.75 to $1.95 and maintain a speculative buy rating on the specialty metals and technology company following the release of a comprehensive market update including an increase in the price outlook for HPA equivalent, increased demand and Alpha HPA’s high purity aluminium products having value adding applications across lithium ion battery, micro-LED and semiconductor manufacturing.
- And Trading Central has identified a bullish signal on Nufarm (ASX:NUF) following the formation of a pattern over a period of 10-days which is roughly the same amount of time the share price may rise from the close of $5.25 to the range of $5.57 to $5.65 according to standard principles of technical analysis.
Wall Street closed mixed on Tuesday as investors questioned whether the recent rally can be maintained given the latest economic data readings painting a mixed picture about the rate cut outlook in the US with the odds for a cut in September currently sitting at 67%. The Dow Jones rose 0.08% for a fifth consecutive winning day, the S&P500 added 0.13%, and the tech-heavy Nasdaq ended the session down 0.1%. Treasury yields declining on Tuesday was also key driver of the Dow and S&P500 rising as investor optimism for rate cuts boosted appetite for equities. Disney shares plunged 9.5% after the media and entertainment giant missed on revenue expectations, while Peleton shares rose 15.5% on speculation that private equity firms have been considering buying out the company.
In Europe overnight, markets closed in the green as investors responded to the release of corporate earnings results in the region. The STOXX600 rose 1.15% boosted by financial services stocks, Germany’s DAX added 1.4%, the French CAC rose just under 1% and, in the UK, the FTSE100 ended the day up 1.22%. Swiss banking giant UBS rallied 9.5% on Tuesday after beating expectations by returning to a quarterly net profit in the latest results while Italian bank UniCredit rose 3.6% on reporting a net profit of $2.6bn euros for the first quarter which beat consensus estimates.
The Asia markets closed mostly in positive territory on Tuesday led by South Korea’s Kospi index gaining 2.16% as heavyweights like Samsung Electronics and SK Hynix did most of the heavy lifting. Japan’s Nikkei rose 1.57% and Hong Kong’s Hang Seng ended the day down 0.51%
Locally, the ASX extended the recent rally into Tuesday’s session with the key index closing the day up 1.44% with all 11 sectors ending the session in the green led by the utilities sector jumping 2.82%. Investor sentiment was boosted on Tuesday by the RBA maintaining Australia’s cash rate at the current level of 4.35% for the next period which was widely expected.
The market didn’t appear to respond to the RBA’s upward revision for inflation expectations over the remainder of 2024 though. Services and fuel inflation remain elevated and are the key drivers of inflation remaining sticky, however, Australia’s central bank drastically revised the inflation outlook upwards from the previous expectation of inflation hitting 3.2% by the December quarter of 2024 to now expecting inflation to remain at 3.8% in the December quarter. This is expected to be driven by wage price index remaining elevated, subdued economic growth, higher imports, higher employment, higher household income, and lower labour productivity.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day up 0.18% tracking the gains from some key market regions overnight.
- On the commodities front this morning, oil is trading flat at US$78.48/barrel, gold is down 0.53% at US$2313.61/ounce and iron ore is up 1.3% at US$119.56/tonne.
- AU$1.00 is buying US$0.66, 101.96 Japanese Yen, 52.67 British Pence and NZ$1.10 cents.
Trading Ideas:
- Bell Potter has downgraded Imdex (ASX:IMD) to a sell rating from a hold and lowered the 12-month price target on the global provider of end-to-end mining services and products company following the release of a soft Q3 update from the company including revenue up 4% YoY but down 6% on a like-for-like basis, and ongoing weakness in global exploration activity is expected to impact the business into FY25.
- And Trading Central has identified a bullish signal on Car Group (ASX:CAR) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $34.83 to $36.40 according to standard principles of technical analysis.
Wall St closed higher overnight as traders lifted Federal Reserve rate cut expectations. The Dow Jones closed 0.46% higher, the S&P 500 ended the trading session over 1% higher and the tech-heavy Nasdaq closed 1.19% in the green.
Over in Europe, markets closed higher following the release of softer-than-expected US jobs data. Germany’s DAX rose 0.96% and the French CAC and the FTSE 100 both gained nearly half a percent.
Locally yesterday, the ASX200 closed 0.70% higher with the majority of the sectors closing in the green. The real estate and utilities sectors led gains, rallying 1.73% and 1.24% respectively. This was offset by the industrial sector which fell 0.18%.
What to watch today:
- The Australian share market is set to open higher with the SPI futures suggesting a rise of 0.49% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.75% higher at 78 US dollars and 70 cents a barrel after Saudi Arabia rose crude prices for Asian customers, suggesting confidence in global energy demand.
- Gold is trading 0.98% higher at 2323 US dollars an ounce and iron ore is trading 0.04% lower at 118 US dollars and 3 cents a tonne.
Trading Idea:
- Bell Potter maintains a buy rating on GrainCorp (ASX:GNC) despite slightly lowering its 12-month price target to $9.20. The buy rating is maintained by Bell Potter after the outlook for GNC is shifting towards the 2024-25 crop and potential La Nina development and what this means for FY25 earnings. Improved east coast prospects have emerged at a period when Northern Hemisphere crop conditions have arguably deteriorated and would be typically viewed as favourable for accumulation margins and oilseed basis.
Wall street closed higher on Friday bolstered by a softer-than-expected jobs report which boosted investor hopes of rate cuts in the near future. The Dow Jones rose 1.18%, the S&P500 added 1.26% and the tech-heavy Nasdaq climbed 1.99% on the rate cut optimism.
Non-farm payrolls indicated 175,000 jobs were added to the U.S. economy in April, which was well below the 240,000 economists were expecting and the US unemployment rate rose to 3.9% from 3.8% for the month. Wages data also came in below expectations which is a strong sign inflation is becoming less sticky as wages inflation has been a key point of stubborn inflation over the last year. Apple shares rose almost 6% on Friday after the tech giant announced a near US$110bn share repurchase and beat analysts’ expectations for 1st quarter results.
Over in Europe on Friday, markets closed higher to round out a negative week as investors responded to corporate earnings results. The STOXX600 ended the day up 0.44%, Germany’s DAX added 0.6%, the French CAC rose 0.54%, and in the UK, the FTSE100 ended the day up 0.51%.
In Asia on Friday markets ended the week in positive territory led by Hong Kong’s Hang Seng rising 1.48%.
Locally on Friday, the ASX200 rose 0.55% as every sector ended the day in positive territory led by consumer discretionary stocks rising just shy of 2% while reit stocks added 1.55%. Block was the best performing stock locally rising 9.83% after the payment platform posted impressive quarterly results that exceeded analysts’ expectations including gross profit rising 22% year-on-year to US$2.09bn.
Gold miners came under pressure locally on Friday amid the sliding price of the precious commodity with evolution mining falling 5.57%, while Ramelius Resources fell 2.04% and Regis Resources declined 1.91%.
Diversified financial house Macquarie fell on Friday after the company released full year results including net profit falling 32% while net operating income declined 12% over the year. Macquarie attributed the fall in key results to a sharp decline in the commodities and global markets business, and a fall in the Macquarie Asset Management business division.
What to watch today:
- Ahead of the first trading session for the new trading week, the SPI futures are expecting the ASX to open Monday’s session up 0.3% on the back of Wall Street’s jobs-driven rally on Friday.
- Looking at commodities this morning, oil is trading 1.22% lower at US$77.99/barrel, gold is down 0.13% 2301.30/ounce and iron ore is down 0.04% at US$118.03/tonne.
- AU$1.00 is buying US$0.66, 101.08 Japanese yen, 52.68 British pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Nickel Industries (ASX:NIC) from $1.50 to $1.54 and maintain a buy rating on the nickel producer following the company’s release of its March quarter production from its Rotary Kilm Electric Furnace operations including production of 31,840 tonnes of contained nickel and cash costs below Bell Potter’s forecasts. The company faced impacted mining production from its Hengjaya Mine however, mixed hydroxide precipitate production increased 16% which ramped up towards nameplate capacity. Bell Potter’s analyst sees tailwinds are increasing in CY24 once mining permit delays are overcome.
This week's US earnings season was a mixed bag of highs and lows in the market spotlight. Pfizer soared despite COVID vaccine sales dip, while PayPal and Pinterest showed tech potential. Yum Brands stumbled, despite Taco Bell's digital surge. Coca-Cola beat expectations but grappled with inflation and market shifts.
In this week’s wrap, Sophia covers:
• (0:29): Pfizer’s strong quarter despite COVID dip
• (1:05): PayPal’s profitability focus against tech giants
• (1:46): Pinterest exceeding expectations, contributed by investments in AI
• (2:42): Taco Bell’s digital surge
• (2:54): Coca-Cola’s key highlights & weaknesses
• (4:46): the most traded stocks & ETFs by Bell Direct clients
• (5:16): economic data to watch next week.
US equities closed mixed overnight after the Federal Reserve kept rates on hold at 5.25% – 5.5% and ruled out that the central bank’s next move could be a hike. While the Dow Jones closed higher off the back of the Fed’s announcement, the broader market finished lower after a volatile trading session. During the session the S&P500 was up 1.2% before closing 0.34% lower, and the tech-heavy Nasdaq had climbed 1.7% before closing 0.33% lower.
What to watch today:
The Australian market is set to open 0.07% lower this morning, following heavy losses yesterday across all industry sectors. The ASX200 closed yesterday’s trading session down 1.23%, with energy and materials weighing down on the market the most.
The market will also be watching NAB’s share price today. The bank released its half-year results this morning and announced it will buy back up to $1.5 billion of its own stock as profit at the lender came in line with expectations. Cash earnings declined 13% to $3.55 billion in the six-month period ending March 31.
Also today, continue to watch Qantas shares following a data breach on the airline’s app yesterday. Qantas passengers were seeing details of other customers on their app, including the name, flight details and loyalty points. QAN declined 1.2% yesterday.
Also watch Woolworths (ASX:WOW) after the supermarket sold down its stake in Endeavour (ASX:EDV). Woolworths may see an uptick today after closing in the red yesterday, after announcing the $468 million Endeavour sell down, which offset a broad market sell-off. Endeavour Groups (ASX:EDV) share price is looking bullish today, so keep watch of Endeavour as well.
The market will also be watching NAB’s share price today when the bank releases its half-year results. Goldman Sachs are expecting the bank to declare an 81cps full franked interim dividend, down 2.4% on last year’s interim dividend.
In commodities,
- Oil is trading more than 3.4% lower at US$79 per barrel, the lowest price in over a month as a rebound in US crude stockpiles supported supply of a ceasefire in the Middle East.
- Gold is trading higher, advancing more than 1.3% to $2,321 per ounce, but remaining near the low levels seen about a month ago, as US traders digest the latest Fed meeting.
- And iron ore is steady at US$110 per tonne.
And in economic news, balance of trade data for March will be released at 12:30pm today.
Trading Ideas:
- Bell Potter maintains their Buy rating on Aeris Resources (ASX:AIS), after the multi-mine copper-gold production and exploration company released its March quarterly report. Bell Potter have increased their 12-month price target from $0.23 to $0.30, and at the current stock price of $0.25, this implies 17.6% share price growth in a year.
- And Trading Central have identified a bearish signal in Sigma Healthcare (ASX:SIG) indicating that the stock price may fall from the close of $1.25 to the range of $1.08 - $1.12 over 35 days, according to the standard principles of technical analysis.
To receive more insights and research that is available exclusively to Bell Direct clients, open your Bell Direct account here.
Wall Street tumbled on Tuesday to close out a losing month following the release of the latest inflation related data and ahead of the Fed’s latest interest rate decision out on Wednesday US time. The S&P500 fell 1.57%, the Dow Jones lost 1.5% and the tech-heavy Nasdaq tumbled 2.04%. For the month of April, the three key indices are set to post a notable loss. Higher-than-expected wages data has raised investor concerns of the rate cut outlook out of the Fed. For the first quarter, the employment cost index which measures wages and benefits, climbed 1.2% which was above economists’ expectations of a 1% rise.
Across the European markets overnight, markets closed in the red to record their first negative month since October as investors assessed the latest slew of earnings results. The STOXX600 fell 0.6% on Tuesday, Germany’s DAX lost 1.03%, the French CAC declined 0.99% and, in the UK, the FTSE100 closed Tuesday’s session down just 0.04%.
In Asia overnight, markets closed mostly higher as investors assessed factory activity figures out of China which came in at an expansion to 50.4 in April compared to 50.8 in March which beat economists’ expectations but indicated a slower pace of activity expansion in the world’s second largest economy. Japan’s Nikkei closed flat, Hong Kong’s Hang Seng index rose 0.09%, and South Korea’s Kospi index rose 0.17%.
The local market has started the week on a green run, with the key index closing Tuesday’s session up 0.35% led by consumer discretionary and real estate stocks, which are two of the rate sensitive sectors. Lithium miners and explorers got a much-needed boost yesterday on a rise in the price of lithium carbonate, which sent Arcadium Lithium to the top of the ASX200 winners with an 8.4% rise, while IGO rose 7.3% and Liontown Resources added 2.9%.
Investors got a boost from Australia’s retail spend data coming out yesterday for March indicating a 0.4% fall in consumer spend, which was well below the 0.2% rise economists were expecting. Retail spend is a key driver of inflation and this reading is a key supporting factor for the RBA to realise some key inflation drivers are easing, which supports the notion to maintain rates at the current level instead of considering another rate hike.
Earnings season continues in Australia for the latest quarter which saw investors respond with mixed reactions on Tuesday. Australian fuel supplier and producer Ampol fell 3.3% after reporting a 21% drop in its Lytton Refiner Margin and a 7.3% decline in refinery production over the last three months.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are expecting the ASX to open the day down 1.20%, tracking the global sell-off overnight.
- On the commodities front this morning, oil is down 0.92% at US$81.96/barrel, gold is down 1.61% at US$2295/ounce and iron ore is up 0.35% at US$110.54/tonne.
- AU$1.00 is buying US$0.65, 102.26 Japanese Yen, 52.05 British Pence and NZ$1.10.
Trading Idea:
- Bell Potter has downgraded Telix Pharmaceuticals (ASX:TLX) from a buy to a hold and maintain a $14.50 price target on the leading cancer imaging and therapy agent pharmaceuticals company following the release of an outstanding 1Q24 revenue growth and a major inflection point approaching for the company through its first therapeutic asset being a crucial piece of the long-term value proposition. The downgrade to a hold is simply due to valuation as the share price has been on a run recently, and this is the first downgrade since Bell Potter first initiated coverage of the company in 2021.
Wall Street opened the new trading week higher as investors prepare for a big week of corporate earnings results and the latest Federal Reserve meeting. The Dow Jones rose 0.38%, the S&P500 added 0.32% and the tech-heavy Nasdaq gained 0.35%. Tesla jumped more than 15% on Monday after overcoming a hurdle for its self-driving technology in China, while Domino’s Pizza gained more than 5% after reporting earnings that beat analysts’ expectations.
Across European overnight, markets closed mixed as investors assessed key earnings, company updates and inflation data out in the region. The STOXX600 rose 0.1%, Germany’s DAX fell 0.24%, the French CAC lost 0.29%, and, in the UK, the FTSE100 ended the day up 0.14%. The driver of Germany’s sell-off was the latest preliminary inflation reading coming in at an annual rate of 2.4% for April, which is a 0.6% rise from March and up 2.3% year-on-year. Dutch medical device giant Philips soared 29% on Monday after the company agreed to a $1.1bn settlement in a U.S. case regarding the recall of some of the company’s products that treat sleep apnoea.
Across Asia on Monday, markets closed mostly higher as the Japanese yen strengthened and ahead of key economic data out in the region today including China’s official purchasing managers index for April. Japan’s Nikkei rose 0.81% on Monday, Hong Kong’s Hang Seng index rose 0.54%, and China’s CSI 300 rose 1.11%.
The local market kicked off the new trading week in positive territory on the back of strong corporate earnings results that impressed investors in addition to taking strong lead from the US rally that ended last week on a high. The ASX200 closed Monday’s session up 0.81% with every sector ending the day in the green. Embattled casino operator Star Entertainment Group (ASX:SGR) rallied over 2% on Monday after the company announced Chairman David Foster has stepped down from his role, with the board appointing board member Anne Ward to replace Mr. Foster as the company looks to overcome recent challenges. Weak annual recurring revenue in Megaport’s (ASX:MP1) latest update led to investors selling out on Monday which sent the share price down over 5%, despite the IT company upgrading FY24 EBITDA guidance. Australia’s retail sales data is out today with the market expecting a 0.2% rise in March from February which would be a slight decline from the 0.3% reported in February and will provide another indicator that inflation is easing as consumer retail spend is a key driver of inflation.
What to watch today:
- Ahead of Tuesday’s trading session in Australia the SPI futures are expecting the ASX to open the day up 0.16% tracking global gains overnight.
- On the commodities front this morning, oil is trading 1.2% lower at US$82.72/barrel, gold is down just 0.08% at US$2335.86/ounce and iron ore is up 0.44% at US$110.16 per tonne.
- AU$1.00 has strengthened to buyUS$0.66, 102.54 Japanese Yen, 52.36 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has maintained a buy rating on Coventry Group (ASXCYG) and raised the 12-month price target on the leading Australian industrial supply and services group after the company announced the acquisition of Steelmasters which is Australia and New Zealand’s third largest specialty fastener distributor, for an upfront cash consideration of NZ$45m. Coventry is funding the acquisition with a fully underwritten $25m two-tranche institutional placement and after receiving strong support from investors, upsized the raising to $30m.
- Trading Central has identified a bullish signal on Pilbara Minerals (ASX:PLS) following the formation of a pattern over a period of 53-days which is roughly the same amount of time the share price may rise from the close of $3.96 to $5.00 to $5.20 according to standard principles of technical analysis.
Wall St returned to rally mode on Friday following the release of strong earnings results and fresh US inflation data. The S&P500 and Nasdaq both posted their best week since November and closed up 1.02% and 2.03% respectively on Friday while the Dow Jones added 0.4% ended Friday’s session up 0.4%. Alphabet was a key driver of the rally on Friday with the stock lifting 10% after the tech juggernaut posted better-than-expected first quarter earnings while Microsoft added nearly 2% on the release of strong third-quarter results driven by an uptick in cloud growth.
Investors also digested March’s core personal consumption expenditures index reading which came at a rise of 2.8% which was ahead of expectations of 2.7%.
In Europe on Friday, strong earnings results out in the region also prompted investors to rally around equities to close the week on a high with the STOXX600 rising 1.2% while Germany’s DAX added 1.36%, the French CAC rose 0.89% and in the UK, the FTSE100 gained 0.75% on Friday.
The global rally outside of Australia on Frida y extended to the Asia markets, rebounding from the recent sell-off in the region, led by Japan’s Nikkei climbing 0.81% on the BOJ maintaining interest rates at 0%-01% for another month as expected and Tokyo’s headline inflation coming in at 1.8%, easing from the 2.6% reported in March.
The local market ended Friday’s session down 1.4%, as hotter-than-expected inflation data released on Wednesday continues to push bond yields higher and dampens investor hopes of interest rate cuts out of the RBA in the near future. When interest rate outlook is uncertain, investors tend to flock to investments that offer safer returns like government bonds which is why the Australian 10-year bond jumped 19 basis points to 4.59% and the 1-year bond jumped 13 basis points to 4.36% which tops the current cash rate of 4.35%.
Investors locally also took strong lead from Wall Street Thursday after weaker-than-expected GDP data was released, indicating the high interest rate environment is dampening growth for the world’s largest economy.
Every sector locally ended Friday’s session in the red led by the rate sensitive real estate sector which tumbled over 2% as companies in the REIT space wear the full costs of the high interest rate environment unlike other sectors that can pass on the rising costs associated with interest rate hikes. The materials sector was also weighed down on Friday by BHP falling over 4.4% after the mining giant announced a takeover bid worth almost $60m for copper miner Anglo American, which was subsequently rejected by Anglo American this afternoon on the grounds of materially undervaluing the company.
What to watch today:
- Ahead of the first trading session of the new week, the SPI futures are expecting the ASX to open Monday up 0.32% tracking Wall Street’s rally on Friday.
- On the commodities front this morning, oil is trading 0.05% lower at US$83.72/barrel, gold is up 0.31% at US$2337/ounce and iron ore is up 0.44% at US$110.16/tonne.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Regis Resources (ASX:REG) from $2.60 to $2.80 and maintain a buy rating on the gold miner following the release of the company’s March quarter update which came in below Bell Potter expectations as a result of rainfall impact on operations, however, the price target increase is due to gold price tailwinds and the company completing its first full quarter of unhedged gold sales.
- And Trading Central has identified a bullish signal on Champion Iron (ASX:CIA) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may rise from the close of $7.12 to the range of $7.55 to $7.65 according to standard principles of technical analysis.
Wall St closed lower overnight after the latest economic data showed a slowdown in growth, pointing to persistent inflation. The Dow Jones closed nearly 1% lower, the S&P500 closed 0.46% in the red and the tech-heavy Nasdaq fell 0.64%. US GDP data was released overnight, coming in at 1.6% in the first quarter which was lower than the forecast of 2.4%. Inflation data also increased at a 3.4% pace, above the previous quarters 1.8% advance.
Over in Europe, markets closed lower as investors react to the latest set of earnings. The STOXX600 closed 0.6% lower with the majority of sectors closing in the red with industrial stocks falling 1.9% whilst healthcare added 0.2%. Germany’s DAX fell 0.95%, the French CAC lost 0.93%, whilst over in the UK, the FTSE100 ended the trading session nearly half a percent in the green.
And locally yesterday, markets were closed for the ANZAC Day public holiday.
What to watch today:
- The Australian market is set to open lower, with the SPI futures suggesting a fall of 0.34% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 1.29% higher at 83 US dollars and 77 cents a barrel following US crude inventories falling by 3.37 million barrels last week.
- Gold is trading 0.7% higher at 2332 US dollars an ounce and iron ore is trading 0.43% higher at 109 US dollars and 23 cents a tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Beach Energy (ASX:BPT) and has a 12-month price target of $1.80. The buy rating is maintained by Bell Potter as BPT is rolling-off peak capex into a step-change in production and free cash flow in FY25-26. The company has retained a strong balance sheet capable of supporting the group’s progressive dividend policy. With a positive view on Australian east coast gas and LNG markets, and a strong production and earnings growth outlook, a buy rating is maintained.
- And Trading Central has identified a bullish signal on NextGen Energy (ASX:NXG), indicating that the stock price may rise from the close of $12.10 to the range of $13.70-$14.00, on a pattern formed over 15 days according to the standard principles of technical analysis.
Over in the US on Tuesday, strong corporate earnings results drove Wall Street into rally territory following a turbulent, widespread sell-off last week. The Dow Jones rose 0.69%, the S&P500 gained 1.2% and the Nasdaq ended the session up 1.6%. Music streaming platform Spotify jumped 11.4% on Tuesday after beating Wall Street’s first-quarter expectations, while Tesla is set to report earnings after the closing bell today. So far, 20% of the S&P500 companies have reported with 76% having beaten analysts’ expectations according to FactSet.
In Europe overnight, markets closed higher also due to strong corporate earnings reports being released. The STOXX600 rose 1.1% on Tuesday as all sectors aside from mining closed the day in the green. Germany’s DAX rose 1.55% yesterday, the French CAC added 0.81%, and the UK’s FTSE100 rose to another intra-day record high before settling the day up 0.26%. The ease in gains on the FTSE100 followed the Bank of England’s chief economist making hawkish comments regarding the rate cut outlook in the UK.
Asia markets closed mostly in the green on Tuesday as favourable business activity in the region indicated faster expansion of activity in April, in a rebound for key economies across Asia. Japan and India recorded faster rates of expansion in April across the business sector which prompted Japan’s Nikkei to rise 0.3% on Tuesday, while Hong Kong’s Hang Seng rose 2% and South Korea’s Kospi index closed just 0.24% lower on Tuesday.
The local market has recovered from last week’s sell-off to start this week in positive territory with Tuesday’s session closing up 0.45%, driven by Wall Street’s rally on Monday and ahead of key local inflation data out just before midday today with the market expecting a stark decline in inflation from an annual rate of 4.1% in Q4 to 3.4% in Q1. Tech stocks led the charge on Tuesday rallying 1.73% on inflation and rate cut outlook, while energy stocks came under pressure amid the sliding price of oil over the last week.
Gold producers were also sold off on Tuesday on the declining price of the precious commodity which sent Ramelius, Regis Resources and St Barbara lower yesterday.
Soft almond prices caused investors to flee Select Harvests on Tuesday, sending the price of the almond producer down 11%, while investors also sold out of Lifestyle Communities after the company signalled lower home settlements than expected in the latest update.
Brambles was one of the leading losses on Tuesday after the pooling and logistics solutions company posted a trading update that disappointed investors.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are expecting the ASX to open the day up 0.31%, tracking Wall Street’s rally overnight.
- On the commodities front this morning oil is trading 1.5% higher at US$83.35/barrel, gold is down 0.4% at US$2324.68/ounce and iron ore is up 0.34% at US$108.62/tonne.
- AU$1.00 is buying US$0.65, 100.43 Japanese Yen, 52.06 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the 12-month price target on MedAdvisor (ASX:MDR) from 44cps to 47cps and maintain a buy rating on the healthcare tech company following the release of a strong Q3 result out of the company driven by US growth including revenue of $99.8m YTD, and Q3 revenue of $24.2m which is up 42% on the PCP. The Q3 update gives Bell Potter’s analyst confidence that MedAdvisor is executing nicely on its path to profitability.
- And Bell Potter has maintained a buy rating and price target of $6.35 on Boss Energy (ASX:BOE) following the announcement of the company’s first drums of uranium being produced at its Honeymoon mine in South Australia, making Boss’s Honeymoon mine the third uranium mine operating in Australia.
Wall St closed higher overnight as the S&P 500 broke a 6-day losing streak. The Dow Jones gained 0.67%, the tech-heavy Nasdaq rallied 1.11% and the S&P 500 ended the trading session 0.87% in the green.
In terms of US shares, Nvidia jumped 4.4% following a 14% sell off last week with Arm Holdings also rebounding nearly 7% overnight.
Over in Europe, markets closed higher with the STOXX600 closing 0.6% higher with the majority of sectors ending the day higher. Gains were led by telecoms stocks which rose 2.1%, whilst auto stocks fell 0.8%.
Locally yesterday, the ASX200 closed over 1% higher with all but one sector in the positive. Gains were led by the health and communication services sectors which gained 1.97% and 1.73% respectively. This was offset by the energy sector which fell 1.51% on Monday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.25% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.09% lower at US$82.14 a barrel as geopolitical tensions continue in the middle east.
- Gold is trading 2.70% lower at US$64.59 an ounce as Tehran downplayed Israel’s strike against Iran which moved investors away from the safe-haven asset.
- And iron ore is trading 0.28% higher at US$108.25 a tonne as markets predict higher demand from Chinese steel producers.
Trading Ideas:
- Bell Potter has maintained a buy rating on AMA Group (ASX:AMA) and has a 12-month price target of $0.12. The buy rating is maintained by Bell Potter as AMA released its appendix for the third quarter of FY24 with EBITDA up 43% year-on-year. The $0.12 price target is a greater than 100% premium to the share price so Bell Potter maintains the buy recommendation.
- And Trading Central has identified a bullish signal on IVE Group (ASX:IGL), indicating that the stock price may rise from the close of $2.11 to the range of $2.38-$2.44, on a pattern formed over 31 days, according to the standard principles of technical analysis.
Wall Street ended Friday’s session mostly in the red as the theme has gone in the U.S. over the last week with investor jitters rising amid fears of a pushback in the rate cut outlook from the Fed due to inflation remaining sticky in the world’s largest economy.
The Nasdaq fell over 2% on Friday as investors retreat from chip stocks including Nvidia plummeting 10%, and Netflix falling 9% even after quarterly results beat market expectations. The Dow Jones bucked the downfall trend on Friday by rising 0.56%, while the S&P500 slipped 0.88%. While investor sentiment in the U.S. has primarily been focused on the rate outlook over the last week, investors have also been equally as concerned over rising tensions in the Middle East.
The S&P500 had its worst week last week since March 2023 while the Nasdaq lost 5.5% and the Dow Jones gained 0.01% over the trading week.
Over in Europe markets it was a different story as investor sentiment was boosted by rate cut speculations out of the ECB. The STOXX600 rose 0.3% on Friday, Germany’s DAX fell 0.55%, the French CAC closed flat and, in the UK, the FTSE100 rose 0.24%. Banks led the gains in the region while energy stocks dropped 1.5% on the sliding price of oil.
In Asia on Friday, markets tumbled amid escalating tensions in the Middle East, particularly on the back of Israel’s attack on Iran. Japan’s Nikkei fell 2.66% on Friday as key inflation data in the region indicated headline inflation fell to 2.7% in March, from 2.8% in February. South Korea’s Kospi index fell 1.63%, and Hong Kong’s Hang Seng fell 0.99%.
Locally on Friday the ASX200 fell just shy of 1% as all 11 sectors closed the day in the red led by the rate sensitive sectors as tech dropped 1.55% and REIT stocks fell 1.45%. Karoon Energy fell 5.4% on Friday after downgrading guidance for oil production in FY24.
The price of gold rallied to a record high on Friday above US$2400/ounce as the safe-haven asset soars in popularity both from investors and global banks amid rising geopolitical tensions and deflationary pressures in certain key economies around the world.
What to watch today:
- Ahead of the first trading session to start the new week, the SPI futures are expecting the ASX to open the trading day down 0.6%, extending on the negative sentiment from last week.
- On the commodities front this morning oil is down 0.1% to trade at US$83.03/barrel, gold is down 0.3% at US$2384/ounce and iron ore is up 0.28% at US$108.25/tonne.
- AU$1.00 is buying US$0.64 cents, 99.30 Japanese Yen, 51.87 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Gold Road Resources (ASX:GOR) from $1.85 to $2.10 and maintained a buy rating on the gold producer following the release of the 1Q24. Despite significant rain events impacting production and damaging the road supply route to the company’s Gruyere project, Bell Potter’s analyst believes the mining issues have now been overcome and the company’s share price to recover, supported by gold price tailwinds.
- And Trading Central has identified a bearish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 27-days which is roughly the same amount of time the share price may fall from the close of $1.25 to the range of $1.08 to $1.12 according to standard principles of technical analysis.
Wall St closed lower overnight as the S&P 500 fell for the fifth straight day, its longest losing streak since October. The Dow Jones gained 0.06%, the tech-heavy Nasdaq lost over half a percent and the S&P 500 lost 0.22%.
Over in Europe, markets closed higher as investors speculate about the first interest rate cut by the European Central Bank. Germany’s DAX closed 0.38% higher, the French CAC closed 0.52% in the green and over in the UK, the FTSE100 ended the trading session up 0.37%.
Locally yesterday, the ASX200 closed 0.48% higher with the majority of the sectors rallying. Gains were led by the information technology and materials sectors which gained 1.01% and 0.99% respectively. This was offset by the health sector which lost 0.47% by market close yesterday.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.72% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.64% lower at US$82.16 a barrel, following a surge in US oil inventories.
- Gold is trading 0.48% higher at US$2379 an ounce after financial chiefs in the US, Japan and Korea signalled a warning over depreciation in currencies.
- And iron ore is trading 1.16% higher at US$107.30 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on APM Human Services International (ASX:APM) despite decreasing its 12-month price target to $1.40. The buy rating is maintained by Bell Potter following the APM board receiving an offer of $1.40 per share from MDP. Hence, the 12-month target price target reflects the offer from MDP, which is believed by Bell Potter, likely to proceed.
- And Trading Central has identified a bullish signal in Pointsbet Holdings (ASX:PBH), indicating that the stock price may rise from the close of $0.81 to the range of $0.88-$0.90, on a pattern formed over 24 days, according to the standard principles of technical analysis.
Wall St closed lower on Wednesday with the S&P500 posting its fourth consecutive losing session, as key technology names weighed on the market midweek. The Dow Jones fell 0.12% on Wednesday, the S&P500 lost 0.58% and the tech-heavy Nasdaq declined 1.15%. High growth stocks faced the biggest pressure on Wednesday as the Fed’s higher for longer consensus dampens growth runways for stocks of this nature. Investors in the US have been trimming the megacap names like Nvidia, Meta and Apple in favour of other market sectors that have attractive outlook over the coming months.
United Airlines surged more than 17% on Wednesday after posting a smaller than expected loss and beating on revenue expectations.
Over in Europe, markets in the region closed higher as retail stocks posted modest sales growth. The STOXX600 rose 0.2%, Germany’s DAX added 0.02%, the French CAC added 0.62%, and, in the UK, the FTSE rose 0.35%.
Shares in luxury retailer LVMH group climbed as much as 5.2% during the session before easing gains at the closing bell after the company posted modest first quarter sales growth. UK inflation also eased more than expected in March to an annual rate of 3.2%, which was just 0.1% above economists expectations.
Looking at the local index, the ASX200 extended its losing run, closing down 0.09% on Wednesday, taking strong lead from global markets on Tuesday amid concerns over sticky inflation and rising geopolitical tensions. Utilities stocks offset some of the losses by rallying 2.8% while healthcare, materials and energy stocks weighed on the key index.
Evolution Mining jumped over 8% on Wednesday to a two-year high after reporting a 15% rise in gold output for March and the company affirmed its 2024 guidance.
Mining giant Rio Tinto disappointed the market yesterday after reporting a drop in iron ore production and shipments in Q1.
DroneShield also soared 17% yesterday after the defence tech company released a second significant announcement this week, outlining the company was awarded a contract with NATO’s Support and Procurement Agency for the first Counter-small UAS procurement framework agreement in NATO history. The initial agreement is for three years with extension options. This announcement follows DroneShield announcing a first-quarter update earlier in the week including record Q1 revenues of $16.4m, which is 10x the PCP.
What to watch today:
- Ahead of Thursday’s session on the ASX, the SPI futures are expecting the local market to open the day up 0.26% tracking some global market gains overnight.
- On the commodities front this morning, oil has retreated to trade down 3.05% at US$82.76/barrel, gold is down 0.5% at US$2365/ounce, and iron ore is up just 0.02% at US$106.07/tonne.
- AU$1.00 is buyingUS$0.64, 99.30 Japanese Yen, 51.59 British Pence and NZ$1.09.
Trading Idea:
- Trading Central has identified a bearish signal on Mirvac Group (ASX:MGR) following the formation of a pattern over a period of 46-days which is roughly the same amount of time the share price may fall from the close of $2.10 to the range of $1.82 to $1.88 according to standard principles of technical analysis.
Wall street closed mixed on Tuesday after Fed Chair Jerome Powell said interest rates may need to stay higher for longer if inflation drivers and prices remain sticky. The Dow Jones rose 0.17%, boosted by UnitedHealth shares on the back of better-than-expected first quarter revenue. The S&P500 fell 0.21% on Tuesday and the tech-heavy Nasdaq ended the day down 0.12%.
Powell remarked that recent data shows solid economic growth and continued strength in the labour market, but lack of further progress so far this year on returning to the Fed’s target 2% inflation rate goal is holding back rate cut outlook.
In Europe overnight, markets closed lower as investors assessed developments in the Middle East tensions. The STOXX600 fell 1.6%, weighed down by mining and banking stocks. Germany’s DAX ended Tuesday’s session down 1.44%, the French CAC lost 1.4% and, in the UK, the FTSE100 declined 1.82%.
Across Asia markets overnight, markets closed lower as investors assessed economic data and await Israel’s response to Iran’s attack over the weekend. South Korea’s Kospi index fell 2.28% on Tuesday, Japan’s Nikkei lost 1.94%, and Hong Kong’s Hang Seng lost 2.12%.
Over in China, the CSI index fell 1.07% on Tuesday following the release of key economic data released painting a very mixed picture into the recovery progress for the world’s second largest economy. GDP Growth rate came in above expectations at 5.3% for Q1 on an annual basis, where economists were expecting a 5% rise, indicating economic growth is underway. Conversely though, industrial production came in at a 4.5% rise for March on an annual basis which is a decline from the 7% rise recorded in February and well below economists’ expectations of a 5.4% rise, indicating industrial output continues to struggle post-pandemic. Retail Sales data also out in China yesterday came in at a rise of 3.1%, which similar to industrial production, is a 2.4% decline on February and was well below economists’ expectations, indicating Chinese retail consumption is sliding.
The local market had its worst trading session in over a year as the ASX closed Tuesday’s session down 1.81%, tracking Wall Street’s turbulence on Monday following the releasee of stronger-than-expected retail sales out in the US which further dents hopes of rate cuts in the near-term for the world’s largest economy. Escalating tensions in the Middle East also crippled investor sentiment toward riskier high growth assets like tech and real estate stocks, however, all 11 sectors closed in the red on Tuesday.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day down 0.3% on the back of the global sea of red overnight.
- On the commodities front this morning, oil has retreated to trade 0.16% lower at US$85.26/barrel, coal is up 2.06% at US$136.50/tonne, gold is up 0.06% at US$2392/ounce and iron ore is flat at US$106.05/tonne.
Trading Ideas:
- Bell Potter has downgraded the rating on Cooper Energy (ASX:COE) from a buy to a hold and have increased the 12-month price target on the gas exploration and development company following the release of the company’s Q3FY24 trading update including quarterly gas production of 5.5Petajoules, sales of 5.6Petajoules and revenue of $51.8m which were all in-line with Bell Potter’s expectations. The downgrade to a hold for Cooper Energy follows recent share price appreciation and ahead of the company’s expected achievement of free cash flow generation in FY25.
- And Trading Central has identified a bearish signal on Challenger (ASX:CGF) following the formation of a pattern over a period of 46-days which is roughly the same amount of time the share price may fall from the close of $6.50 to the range of $5.80 to $5.90 according to standard principles of technical analysis.
Wall St closed lower overnight as geopolitical tensions continue in the Middle East. The Dow Jones fell 0.65%, the S&P500 lost 1.2% and the tech-heavy Nasdaq ended the trading day, 1.79% in the red.
The CBOE Volatility index, Wall Street’s fear gauge closed at its highest level since October following Iran’s attack on Israel on Saturday night, the first direct attack on Israel from Iran.
Over in Europe, markets closed mixed as investors react to the Middle Eastern War. The STOXX600 closed marginally higher with oil and gas stocks leading losses down 1.6%. Germany’s DAX rose over half a percent, the French CAC gained 0.43% and over in the UK the FTSE100 closed 0.38% lower.
Locally yesterday, the ASX200 closed 0.46% lower with the majority of the sectors finishing in the red. Losses were led by the information technology and communication services sectors which lost 1.75% and 1.05% respectively. This was offset by the energy sector which gained 0.38%.
What to watch today:
- The ASX200 is set to open lower with the SPI futures suggesting a fall of 0.81% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.06% higher at US$85.68 a barrel as investors react to the Middle Eastern tensions.
- Gold is trading 1.71% higher at US$2383 an ounce and iron ore is trading 1.28% higher at US$106.05 cents a tonne as markets increased their bets of higher demand for iron from Chinese steel producers.
Trading Ideas:
- Bell Potter maintains a buy rating on Life360 (ASX:360) and has a 12-month price target of $16.25. The buy rating is maintained by Bell Potter with first quarter results to be released on the 10th of May, with forecasts and already released metrics implying a solid quarter and a positive start to the year.
- And Bell Potter maintains a hold rating on Droneshield (ASX:DRO) and has increased its 12-month price target to $1.00. The hold rating is recommended as despite strong results in 2024, the announcement of only one single material contract year to date makes Bell Potter believe there is a heightened downside risk at current levels if contracts in the pipeline are delayed until the second half.
Rising geopolitical tensions and inflation concerns were the drivers of Wall Street’s negative close on Friday with the Dow Jones suffering its worst session since January. The launch of attacks on Iran from Israel fuelled oil prices to surge over the weekend paired with fresh U.S. imports data added fuel to investors concerns of rising inflation pushing back the outlook for rate cuts in the world’s largest economy.
The Dow Jones fell 1.24% on Friday and 2.37% for the week, the S&P500 lost 1.46% on Friday and 1.56% for the week and the tech-heavy Nasdaq lost 1.62% on Friday and 0.45% for the week.
First quarter results in the U.S. have started being released with Wells Fargo sliding 0.4% on Q1 results while Citigroup declined 1.7% despite posting a beat in revenue. JPMorgan Chase fell 6% on Friday after the banking giant posted first quarter results including outlook for net interest income to likely come in slightly short of what Wall Street is expecting for 2024.
Over in Europe, markets closed mixed on Friday as investors digested key economic data and assessed the latest inflation reading out of the US. The STOXX600 rose 0.06% led by mining stocks rising 2.4%, Germany’s DAX fell 0.13%, the French CAC fell 0.16%, and, in the UK, the FTSE100 rallied 0.91%. British economic output increased by 0.1% MoM in February which was inline with expectations, and provides a further sign of slight improvement in economic stability following sluggish growth over recent months. The European Central Bank also announced the holding of interest rates for a fifth consecutive meeting on Thursday but gave its clearest signal yet that rate cuts are on the horizon in the near future.
In Asia on Friday, markets closed mixed in the region as economic data and key inflation readings sparked mixed investor reactions. Hong Kong’s Hang Seng lost 2% and China’s CSI Index fell 0.81% following China’s exports falling more than expected in the month of March, coming in at a decline of 7.5% compared to the 2.3% fall economists were expecting.
Locally on Friday the ASX closed the final trading session of the week lower as investors continue to question rate cut hopes out of the RBA and Fed. The ASX200 fell 0.3% on Friday but rose 0.3% for the week. Consumer staples and discretionary stocks weighed on the market on Friday but some of the heavy losses were offset by strong gains for utilities and tech stocks.
Star Entertainment Group fell 7.3% on Friday after reporting a significant decline in revenues from its gaming rooms, while Cettire dropped almost 7% despite preliminary sales figures for Q3 coming in strong.
What to watch today:
- Ahead of the local trading session here in Australia to start the new trading week, the SPI futures are expecting the ASX to open Monday’s session down 0.64% tracking Wall Street’s losses on Friday.
- On the commodities front this morning, oil is trading 0.36% lower at US$85.36/barrel, gold is up 0.7% at US$2359/ounce and iron ore is up 1.28% at US$106.50/tonne.
- AU$1.00 is buying US$0.64, 99.22 Japanese Yen, 52.29 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the rating on Cettire (ASX:CTT) from a hold to a buy but have reduced the 12-month price target on the online fashion retailer from $4.50 to $4.00 per share following the release of a Q3 trading update including sales revenue of $168m which was 88% higher than the PCP and was a 14% beat on Bell Potter expectations, however, adjusted EBITDA margins of 3% were a miss to Bell Potter’s expectations.
- And Trading Central has identified a bullish signal on Bega Cheese (ASX:BGA) following the formation of a pattern over a period of 33-days which is roughly the same amount of time the share price may rise from the close of $4.16 to the range of $4.65 to $4.75 according to standard principles of technical analysis.
Rate cuts are on hold as US inflation unexpectedly heats up. The latest data reveals a second consecutive month of rising inflation, dashing hopes for a cool down in June. We'll delve into the key drivers of this inflation surge and what it means for you.
In this week’s wrap, Grady covers:
- (0:10): the latest US inflation reading
- (0:43): the outlook on the Fed rate cut
- (0:54): key inflation drivers
- (4:20): what this means for investors
- (5:43): the most traded stocks & ETFs by Bell Direct clients
- (6:13): economic data to watch next week.
Wall St closed higher overnight as tech shares climbed higher following concerns of persistent inflation. The S&P500 rallied 0.74%, the tech-heavy Nasdaq climbed 1.68% while the Dow Jones closed flat. In terms of US stocks, Nvidia jumped 4.1%, Amazon gained 1.7% and Alphabet ended the day more than 2% in the green.
Over in Europe, markets closed lower overnight after the European Central Bank held rates steady. The STOXX600 closed 0.4% lower with most sectors in the red including banks which lost 2.4. Germany’s DAX lost 0.79%, the French CAC lost 0.27% and over in the UK the FTSE100 fell nearly half a percent.
Locally yesterday, the ASX200 fell 0.44% with losses lead by the information technology and financial sectors, losing 1.71% and 1.3% respectively. This was offset by the material sector which gained 1.4% by market close.
What to watch today:
- The Australian market is set to open lower, with the SPI futures suggesting a fall of 0.37% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.74% lower at US$85.58 a barrel, following hot inflation data coming out of the US.
- Gold is trading 1.57% higher at US$2372 an ounce as investors react to the latest inflation data and the implications it will have on the Fed’s monetary policy.
- And iron ore is trading 0.3% lower at US$104.02 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Telix Pharmaceuticals (ASX:TLX) and has a 12-month price target of $14.50. The buy rating is maintained by Bell Potter as Telix has filed for a new investigational drug application for TLX591. TLX continues to pursue a NASDAQ listing primarily for the purpose of enabling better access to the deep pool of specialist investors focused on biotechnology and radiopharmaceuticals in the US. TLX591 is the first of the companies therapeutic products, hence there is a great deal riding on the opening of the investigational new drug.
- And Trading Central has identified a bearish signal in NIB Holdings (ASX:NHF), indicating that the stock price may fall from the close of $7.70 to the range of $7.13-$7.23 on a pattern formed over 26 days, according to the standard principles of technical analysis.
Rising treasury yields on the back of a hotter-than-expected inflation reading for March caused US investors to hit the sell button on equities on Wednesday with the Dow Jones falling 1.09% while the S&P500 lost 0.95% and the Nasdaq closed 0.84% lower.
Key US inflation data out overnight came in higher than economists and markets were expecting at an annual rate of 3.5% in March compared to 3.2% in February and showed acceleration in inflation for a second straight month, indicating inflation in the world’s largest economy remains stickier than first expected. Energy costs and food inflation were two of the key drivers of the inflation rate rise and add support for the Fed to hold rates steady for a little while to come. Markets naturally responded negatively as investors had been holding out hope for rate cuts as soon as June.
The Fed’s latest meeting minutes were also released just an hour ago where investor sentiment was dampened further by Fed officials’ concerns that inflation isn’t falling fast enough to the 2% target. US producer price index data is also out today with the market expecting a drop in the PPI from the 0.6% rise reported in February from January this year.
In Europe on Wednesday, markets closed mixed in the region as investors digested the inflation reading out of the US. The STOXX600 closed 0.12% higher, Germany’s DAX rose 0.11%, the French CAC fell 0.05% and, in the UK, the FTSE100 ended the day up 0.33%.
Across the Asia markets on Wednesday, markets closed mostly lower as Japan’s corporate inflation rate rose to 0.8%, which signals a third straight month of increase. Japan’s Nikkei fell 0.5% on Wednesday, Hong Kong’s Hang Seng rose 1.75%, China’s CSI Index lost 0.81% and South Korea’s Kospi Index closed flat.
China’s all-important inflation data is also out today with the market expecting a decline to 0.4% YoY from 0.7% in February which would suggest that any hopes of China’s material recovery post-pandemic have eased.
Locally, the ASX continued this week’s winning streak into the Wednesday’s session with the key index closing the day up 0.31%, with materials stocks again doing most of the heavy lifting with the sector ending the day up 2.34% amid the rising price of iron ore.
Healthcare stocks also lifted the market on Wednesday as Ansell extended its rally a further 4% on the back of a major US acquisition announcement. Neuren rallied 2.2% and ResMed jumped 2.17% on Wednesday.
What to watch today:
- Ahead of the local trading session on Thursday the SPI futures are expecting the ASX to open the day down 0.82% tracking Wall Street’s inflation-driven sell-off overnight.
- On the commodities front this morning, oil has rebounded to trade 1.2% higher at US$86.25/barrel, gold is down 0.82% at US$2334/ounce and iron ore is up 3.32% to trade at US$109/tonne.
- AU$1.00 is buying US$0.65, 99.51 Japanese Yen, 51.68 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has retained a buy rating on Capricorn Metals (ASX:CMM) and have increased the 12-month price target on the gold miner from $5.95 to $6.15 following the release of a production update at the company’s 100% owned Karlawinda Gold Project. Despite the company lowering its production guidance due to major rainfall impacting operations late in March, the analyst sees Capricorn has high quality operations at the Karlawinda Gold Project, low costs, a strong balance sheet and free cashflow which helps to mitigate the company’s single mine risk.
- Trading Central has identified a bullish signal on Yancoal Australia (ASX:YAN) following the formation of a pattern over a period of 21 days which is roughly the same amount of time the share price may rise from the close of $5.63 to the range of $5.94 to $6.02 according to standard principles of technical analysis.
Wall St closed mostly higher across the major indices on Tuesday as investors sat back in anticipation of the release of key inflation data out on Wednesday. The Dow Jones fell just 0.02%, the S&P500 gained 0.14%, and the Nasdaq rose 0.32%.
Key US inflation data is out later tonight which will indicate how well the Fed’s aggressive stance on interest rates has worked to tame inflation in the world’s largest economy. Economists’ are expecting core inflation rate, which excludes volatile items such as food and energy, to ease to 3.7% YoY for March and the overall inflation rate to increase to 3.4% in March from 3.2% in February amid escalating energy prices.
In Europe overnight, a pullback across markets in the region was experienced as investors look toward key economic data out later this week to gauge how local and global inflation is faring. The STOXX600 fell 0.6% on Tuesday, Germany’s DAX lost 1.32%, the French CAC fell 0.86%, and, in the UK, the FTSE100 ended the day down 0.11%.
Across Asia markets on Tuesday, regions closed mixed as investors assessed key consumer confidence data out of Japan and looked ahead to US inflation data out on Wednesday. Japan’s consumer confidence level rose to the highest level since May 2019, prompting Japan’s Nikkei to close up 1.08% on Tuesday, while South Korea’s Kospi fell 0.46% and Hong Kong’s Hang Seng ended the day up 0.7%.
Locally, ASX started the week in positive territory which extended into Tuesday’s green close with the ASX200 ending the session up 0.45% led by materials stocks rising 1.5%. The materials rally was led by the rising price of iron ore on fresh hopes that China’s long-awaited economic recovery could be making some material progress thus driving demand outlook for iron ore.
Westpac consumer confidence data for April and NAB business confidence data for March were both released yesterday with starkly different results indicating a clear difference in consumer vs business confidence at present.
Westpac consumer confidence for April revealed a decline to minus 2.4% from minus 1.8% in March which is well below the rise to 0.5% economists were expecting, which paints a reading that Aussie consumers remain concerned over household finances and borrowing costs in the currently elevated interest rate environment.
NAB business confidence on the other hand surprised both markets and economists, coming in at a rise of to 1 index point from a flat reading in February and above economists’ expectations of a decline to -3 points, indicating business sentiment is improving down under as inflationary pressures continue to ease.
What to watch today:
- Ahead of the local midweek trading session, the SPI futures are expecting the ASX to open 0.31% higher on the back of Wall Street’s rally overnight.
- On the commodities front this morning, oil is trading 1.54% lower at US$85.22/barrel, gold is up 0.4% at US$2349/ounce and iron ore is up 3.43% at US$105.50/tonne.
- AU$1.00 is buying US$0.66, 100.45 Japanese Yen, 52.17 British Pence, and NZ$1.09.
Trading Ideas:
- Bell Potter has maintained a buy rating on mining services and development company Develop Global (ASX:DVP), however, have decreased the 12-month price target on the company from $4.10 to $3.30 amid the restart of the company’s Woodlawn project expected to recommence production in 1HCY25, with Bell Potter’s analyst seeing the upcoming financing options for the restart project as an important upcoming catalyst for the company.
- And Trading Central has identified a bullish signal on Whitehaven Coal (ASX:WHC) following the formation of a pattern over a period of 39-days which is roughly the same amount of time the share price may rise from the close of $7.36 to the range of $8.15 to $8.35 according to standard principles of technical analysis.
Wall St closed Monday’s trading session mixed as investors await key US inflation data. The Dow Jones lost 0.03%, the S&P 500 fell 0.04%, while the tech-heavy Nasdaq gained 0.03%. US treasury yields also rose, up 4 basis points to 4.42%. In terms of US shares, Tesla shares gained 4.9% following the announcement from CEO, Elon Musk that the company’s robotaxi will be unveiled in August.
Over in Europe, markets closed higher to start the trading week as investors await on decisions from the central bank. The STOXX600 ended the day 0.5% in the green, led by mining stocks which rallied 2% whilst media stocks fell 0.2%. Germany’s DAX rose 0.79%, the French CAC increased by 0.72% and over I the UK the FTSE 100 gained 0.41%.
Locally yesterday, the ASX200 rose by 0.2% by market close, led by gains in the information technology and utilities sectors of 1.19% and 0.83% respectively. This was offset by the energy sector which lost 1.24% by closing bell.
What to watch today:
- The Australian share market is set to open higher with the SPI futures suggesting a rise of 0.46% at market open this morning.
- On the commodity front this morning,
- Oil is trading 0.44% lower at US$86.57 a barrel as easing tensions in the Middle East outweighed expectations of tighter global supply.
- Gold is trading 0.41% higher at US$2339 an ounce and iron ore is trading flat at US$102 a tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Beach Energy (ASX:BPT), despite decreasing its 12-month price target to $1.80. The buy rating is maintained by Bell Potter as Waitsia Stage 2 and expansions in the Otways are key growth drivers for BPT, in a market where peers are struggling to lift production. BPT is rolling-off peak capex into a step-change in production and free cash flow in FY25-26 and has retained a strong balance sheet.
- And Trading Central has identified a bearish signal in Patriot Battery Metals (ASX:PMT), indicating that the stock price may fall from the close of $0.84 to the range of $0.71-$0.73 on a pattern formed over 23 days, according to the standard principles of technical analysis.
Wall Street recovered to rally mode on Friday as investors welcomed better-than-expected jobs data indicating the world’s largest economy remains robust as inflation falls and interest rates remain elevated. The rally on Friday was not enough to overcome a losing week across the key indices for Wall St though with the Dow Jones rising 0.8% on Friday but sliding 2.27% for the week, the S&P500 gained 1.11% on Friday but fell 0.95% over the week and the tech-heavy Nasdaq jumped 1.24% on Friday but ended the week down 0.8%. The US Labour Departments’ jobs report out of Friday showed jobs growth of 303,000 in March which beat economists’ expectations of 200,000. Wages also rose 0.3% for the month and 4.1% from a year ago which were in-line with estimates.
Over in Europe, markets closed lower on the holiday-shortened trading week as investors digested key economic data. The STOXX600 fell 0.84%, Germany’s DAX lost 1.24%, the French CAC fell 1.11% and, in the UK, the FTSE100 ended Friday’s session down 0.84%. House prices fell 1% month-on-month in March which were below economists’ expectations of a 0.1% rise in a sign the housing market is crippling under the high interest rate pressure.
Across the Asia markets on Friday, markets closed mixed as South Korea’s Kospi index soared 1.29%, while Japan’s Nikkei ended the day flat, and Hong Kong’s Hang Seng ended the day down 0.18%.
Locally on Friday, the ASX200 posted its third loss over the shortened-trading week, ending the session down 0.6% as local investors were spooked by comments out of the Fed indicating rate cuts may not happen this year if inflation remains sticky.
What to watch today:
- Ahead of the first trading session of the new week locally, the SPI futures are expecting the ASX to open Monday’s session up 0.5% tracking Wall Street’s rally on Friday.
- AU$1.00 is buying US$0.66, 99.62 Japanese Yen, 52.07 British Pence and NZ$1.09.
- On the economic calendar today, Australia’s home loans data for February is out just before midday with the expectation of a 2.25% rise in home loans MoM following a 4.6% drop in January which will indicate a rebound in Aussies’ appetite for home loans as rate cuts are on the horizon.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Mesoblast (ASX:MSB) and have significantly increased the 12-month price target on the biotech company from 58cps to $1.40cps following the FDA informing MSB that the available clinical data from its Phase 3 study in children with steroid refractory acute graft versus host disease appears sufficient to support resubmission of the Biological Licence Application (BLA) for Remestemcel. Bell Potter’s analyst sees the best estimate for approval of Remestemcel is mid-August this year.
- And Trading Central has identified a bullish signal on NRW Holdings (ASX:NWH) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $2.87 to the range of $3.10 to $3.16 according to standard principles of technical analysis.
Bell Direct's Market Analyst, Grady Wulff, is in Adelaide for the Resources Rising Stars conference. Grady’s interviewing top mining Executives and CEOs to talk about where their companies are at and how they're fairing in 2024.
Tune in to see Grady catch up with:
- (0:36) Spartan Resources (ASX:SPR) Managing Director, Simon Lawson
- (2:38) Kingsland Minerals (ASX:KNG) Managing Director, Richard Maddox
- (4:17) Kin Mining (ASX:KIN) Exploration manager, Leah Moore
- (5:46) Australian Rare Earths (ASX:AR3) CEO, Travis Beinke.
Learn what happened in the Australian market this week:
https://www.belldirect.com.au/smarter/insights/articles/weekly-wrap-5-april-insider-access-grady-gets-up-close-with-top-mining-execs-at-resources-rising-stars-conference
Wall St closed lower overnight as investors await the release of jobs data on Friday. The Dow Jones closed 1.35% lower, the S&P 500 lost 1.23% and the tech-heavy Nasdaq fell 1.4%.
Over in Europe, markets closed higher overnight following a slow start to Q2. The STOXX600 closed 0.16% higher with mining stocks gaining 1.7%, whilst chemicals fell 0.6%. Germany’s DAX rallied 0.19%, the French CAC lost 0.2% and over in the UK the FTSE100 closed just under half a percent higher.
Locally yesterday, the ASX200 ended Thursday’s trading session 0.45% higher with all sectors finishing in the green. Gains were led by the information technology and utilities sectors which rose 1.18% and 0.94% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.8% at market open this morning.
-
On the commodities front this morning
- Oil is trading 1.32% higher at 86 US dollars and 60 cents a barrel as continuing geopolitical tensions interrupt oil supply.
- Gold is trading 0.28% lower at 2291 US dollars an ounce as investors await key US jobs data to be released on Friday.
- And iron ore is trading 1.92% lower at 102 US dollars a tonne.
Trading Ideas:
- Bell Potter has maintained a speculative buy rating on EBR Systems (ASX:EBR) and has increased its 12-month price target to $1.43. The speculative buy rating is maintained by Bell Potter as the results from the sub-study released six months ago provided further support for EBR’s WiSE technology developed to eliminate the need for cardiac pacing leads. There is anticipated additional equity funding post FDA approval in the first half of FY25, driving a 10% valuation adjustment.
- And Trading Central has identified a bearish signal in Dexus Convenience Retail REIT (ASX:DXC), indicating that the stock price may fall from the close of $2.69 to the range of $2.43-$2.47, on a pattern formed over 53 days according to the standard principles of technical analysis.
US equities were mixed overnight with the Dow Jones closing 0.1% lower, marking its third straight negative day, while the S&P500 and the Nasdaq closed slightly up 0.1% and 0.2% respectively. The Dow Jones was lower after Intel declined more than 8% off the back of the company posting operating losses in its semiconductor manufacturing business. And AI company Nvidia was in the red despite trading higher for most of the session on Wednesday, restricting gains for the market. Higher rates also weighed down on the market with data out yesterday showing private payrolls grew more than expected in March.
European markets were higher after euro zone inflation fell more than expected. The STOXX 600 closed 0.3% higher with most sectors in positive territory.
What to watch today:
- The Australian market is set to rise 0.33% at the open this morning.
- In commodities,
- The price of oil is trading in the green after the latest Energy Information Administration data saw a surprise increase in US inventories.
- Gold is rallying, surging toward $2,300 an ounce, extending its six-day rally as investors welcomed comments made by Fed Chair Jerome Powell, who indicated that a lower policy interest rate would likely be appropriate “at some point this year”. Gold stocks to watch include Northern Star Resources (ASX:NST), Newmont Corporation (ASX:NEM), Evolution Mining (ASX:EVN) and Bellevue Gold (ASX:BGL).
- And iron ore is also in the green recovering the week’s earlier losses.
Trading Ideas:
- Bell Potter maintains a Buy rating on Electro Optic Systems (ASX:EOS), an Australian defense manufacturer specializing in advanced weapon and satellite tracking technology. EOS has successfully completed a $35 million fully underwritten placement, with the proceeds intended to fund future growth. Bell Potter has lowered their price target by 5% to $2.20 with upcoming potential catalysts for the stock including the next debt repayment scheduled for April, a first quarter update later this month and the H1 results in September. At the current share price of $1.58, this price target implies 39.2% share price growth in a year.
- And Trading Central has a bearish signal on The Star Entertainment Group (ASX:SGR), indicating that the stock price may fall from the close of $0.54 to the range of $0.37 to $0.41 over 31 days, according to the standard principles of technical analysis.
Wall St closed lower for a second straight session, extending on the negative start to the second quarter as bond yields rose and the latest release of economic data dented investor expectations of an interest rate cut out of the Fed in June. The Dow Jones lost 1%, the S&P500 fell 0.72% and the tech-heavy Nasdaq declined 0.95% on Tuesday. Inflationary pressures are climbing from manufacturing data coming in stronger-than-expected for March and the price of oil has risen to a 5-month high.
Key economic data out in the US overnight indicated job openings rose by 8000 in February from January which was hotter than market expectations, while factory orders in the US rose 1.4% in February from a 3.8% decline in January which was also above market expectations. These two pieces of data indicate inflation in the region may remain stickier for longer than expected.
In Europe overnight, stocks closed lower across the region as major markets opened for the first time in April after the Easter long weekend. The STOXX600 fell 0.76% weighed down by retail stocks falling 2.1%. Germany’s DAX lost 1.13%, the French CAC fell 0.92% and, in the UK, the FTSE100 ended the day down 0.22%.
Across the Asia markets on Tuesday, regions closed mixed as investors assessed the release of key economic data out of South Korea and Australia. Hong Kong’s Hang Seng rose 2.18%, while China’s CSI300 index fell 0.42% and South Korea’s Kospi index added 0.2% following the release of key inflation data out in the region indicating inflation remained steady at 3.1% for March.
The local market started the holiday-shortened trading week in the red, with the ASX200 ending the session down 0.11% after touching a record high mid-session as losses among healthcare, industrials, telecom and REIT stocks offset gains among the miners and materials stocks in afternoon trade. The retreat from the midsession record high was on the back of a sluggish session on Wall St on Monday after hotter-than-expected manufacturing data released in the US curbed expectations of a rate cut out of the Fed in the very near future.
Healthcare star Mesoblast soared a further 71% on Tuesday adding to the 217% rise over the last month, in the aftermath of the US FDA approving the company’s phase three clinical trial data for BLA submission last week.
Uranium producer Paladin Energy jumped 4.74% yesterday after the company announced it has achieved the milestone of first production at its Langer Heinrich mine in Namibia. Production guidance is now expected out of the company before July given production is now underway.
What to watch today:
- Ahead of the midweek trading session here in Australia the SPI futures are expecting the ASX to open the day down 0.38%, tracking turbulence on global markets overnight.
- On the commodities front this morning, oil is trading 1.33% higher at US$85/barrel, uranium is up 4.12% at US$88.50/pound, gold is up 0.66% at US$2265/ounce and iron ore is trading 0.5% higher at US$102.50/tonne.
Trading Ideas:
- Bell Potter has increased the rating on Paladin Energy (ASX:PDN) from a speculative buy rating to a strong buy rating and have increased the 12-month price target on the uranium miner from $1.60 to $1.65 following the first uranium production drums being filled with uranium concentrate at the company’s restarted Langer Heinrich Mine in-line with its March quarter guidance. According to the analyst, a line-of sight to first revenue and cashflow removes the need for the speculative rating on the uranium producer.
- And Trading Central has identified a bullish signal on Nexgen Energy (ASX:NXG) following the formation of a pattern over a period of 40-days which is roughly the same amount of time the share price may rise from the close of $12.99 to the range of $14.60-$15.10 according to standard principles of technical analysis.
Wall St closed lower to start the trading week as investors digest the latest US inflation data. The Dow Jones closed 0.6% lower, the S&P 500 fell 0.2% whilst the tech-heavy Nasdaq gained 0.11% by the closing bell. US core PCE data was released on Friday, showing inflation rose 2.8% on a 12-month basis in February, which was in line with expectations.
Europe and local markets were closed yesterday for Easter Monday celebrations.
What to watch today:
- The ASX200 is set to open higher this morning, with the SPI futures suggesting a rise of 1.03% at market open this morning.
-
On the commodities front this morning,
- Oil is trading 0.92% higher at 83 US dollars and 89 cents a barrel as investors await the OPEC+’s meeting later this week.
- Gold is trading 0.81% higher at 2250 US dollars an ounce and iron ore is trading 1.45% lower at 102 US dollars a tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Coronado Global Resources (ASX:CRN), despite decreasing its 12-month price target to $1.65. The buy rating is maintained by Bell Potter as CRN should realise improved production volumes and subsequent cost benefits following the self-funded investment across its Australian and US operations. It is expected that this will generate more consistent free cash flow and shareholders returns going forward.
- And Trading Central has identified a bullish signal on Pilbara Minerals (ASX:PLS), indicating the stock may rise form the close of $3.83 to the range of $4.55-$4.75 on a pattern formed over 18 days according to the standard principles of technical analysis.
Wall St closed higher overnight as the S&P 500 recorded its best quarter since 2019, ending Wednesday’s trading session up 0.86%. The Dow Jones gained 1.22% and the tech-heavy Nasdaq closed just over half a percent higher.
Over in Europe, markets closed slightly higher after a slow start to the session. The STOXX600 closed 0.1% higher with retail stocks closing higher whilst travel stocks fell 2.4%. Germany’s DAX rallied half a percent, the French CAC ended the trading session a quarter of a percent higher and over in the UK the FTSE100 closed flat, up 0.01%.
Locally yesterday, the ASX200 ended Wednesday’s trading session half a percent higher with all but two sectors ending in the green. Gains were led by the consumer staples and health sectors which gained 1.35% and 1.28% respectively.
In terms of economic news, February CPI data came out yesterday at 3.4%, the same as it previous result and slightly lower than the consensus of 3.5%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.76% at market open this morning.
-
On the commodity front this morning,
- Oil is trading flat at US$81.60 a barrel, following a 9.337 million barrel increase in US crude stockpiles.
- Gold is trading 0.74% higher at US$2194 an ounce as investors await on important inflation data to come out of the US.
- And iron ore is trading 2.71% lower at US$107.50 a tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Platinum Asset Management (ASX:PTM) and has a 12-month price target of $1.20. The buy rating is maintained by Bell Potter as PTM look to reduce their cost base in FY25 to get annual costs below $78m. This reduction in costs increased EBITDA forecasts by 3.9% in FY24, 15.3% in FY25 and 36% in FY26.
- And Trading Central has identified a bullish signal on Whitehaven Coal (ASX:WHC), indicating that the stock price may rise from the close of $6.74 to the range of $8.50-$8.90, on a pattern formed over 40 days, according to the standard principles of technical analysis.
Wall Street extended its losses into Tuesday’s session as a morning rally quickly faded in afternoon trade with the Dow Jones ending the day down 0.08%, the S&P500 lost 0.28% and the tech-heavy Nasdaq fell 0.42%. Orders for long-lasting goods in the US rose 1.4% in February in data out yesterday which beat economists’ expectations of a 0.8% rise, which investors may have taken as a sign that inflation remains elevated in the US thus adding support for rates to remain on hold for a little while longer, especially after the slight uptick in CPI in the latest reading out of the US.
Krispy Kreme shares soared 39% on Tuesday after the donut giant announced it would expand its partnership with McDonald’s, while Tesla rallied 5% in a rebound for the EV maker after a few months of negative sentiment from markets in 2024.
In Europe overnight, markets closed slightly higher in the region as investors continue digesting key central bank moves in the region. The STOXX600 rose 0.3%, Germany’s DAX rose 0.67%, the French CAC added 0.41% and, in the UK, the FTSE100 climbed 0.17% on Tuesday.
Across the Asia markets, it was mostly a green session across the board on Tuesday with South Korea’s Kospi hitting a 2-year high as investors assessed the latest batch of economic data. Japan’s annual B2B service inflation remained at 2.1% in February indicating companies continue passing on rising costs to customers. Singapore’s manufacturing output increased 14.2% in February from January’s 6.7% decline which boosted the local index to a 1.31% close on Tuesday and Hong Kong’s Hang Seng rose 1.1% yesterday.
The local market started the week higher before retreating 0.41% on Tuesday taking lead from Wall Street’s losing session on Monday and on the back of local market sell-offs which were hardest felt by tech stocks on Tuesday as the sector closed the session down 1.55%.
Westpac consumer confidence data for March also released yesterday weighed on the market sentiment as the reading for this month came in at -1.8% which is a sharp decline from the 6.2% reported in February and above economists’ expectations of a drop to minus 1.6% which signals consumer sentiment in market conditions is sliding and we are feeling the full bite of the currently elevated rates.
Earlier in the week commodity-related stocks weighed on the key index, however, a rebound in the price of oil, iron ore and gold saw investors buy back into the miners yesterday. While the opposite story can be told for rate sensitive stocks like technology and real estate which started the week on a high note after a less-hawkish RBA statement was released last week, before these sectors declined on Tuesday.
What to watch today:
- Ahead of the local trading session here in Australia for Wednesday, the SPI futures are anticipating the ASX to open the day down 0.24% tracking Wall Street’s turbulence overnight.
- Taking a look at commodity prices, oil has slightly retreated again overnight to trade 0.1% lower at US$81.87/barrel, gold is up 0.3% at US$2177.38/ounce, and iron ore is down 0.9% at US$110.50/tonne.
Trading Ideas:
- Bell Potter has initiated coverage of leading Australian engineering group, Monadelphous Group (ASX:MND) with a buy rating and a price target of $15.40. Bell Potter’s analyst sees strong revenue growth in the company’s FY24 guidance and the EC pipeline revenue is forecast to continue growing in the second half with a step up in construction contracts won in FY24 to date valued at over $750m scheduled to be completed over FY24-FY25.
- And Trading Central has identified a bullish signal on Northern Star Resources (ASX:NST) following the formation of a pattern over a period of 12-days which is roughly the same amount of time the share price may rise from the close of $13.93 to the range of $15.80 to $16.20 according to standard principles of technical analysis.
Wall St started the week in negative territory as US equities took a breather from record territory with the Dow Jones ending Monday’s session down 0.41%, the S&P500 lost 0.31% and the tech-heavy Nasdaq declined 0.27%. United Airlines fell 3.4% after the Federal Aviation Administration announced it would be increasing its scrutiny of the carrier after a series of safety incidents.
Over in Europe, markets closed mixed across the board on Monday as investors continued digesting central bank moves in the region to gauge how the battle against inflation is faring. The STOXX600 rose 0.04% to extend on its record close from Friday driven by oil and gas stocks rising on a rebound in the price of the two key commodities. Germany’s DAX rose 0.3% on Monday while the French CAC closed flat and, in the UK, the FTSE100 ended Monday’s session down 0.17%.
Across the Asia markets overnight, it was mostly a sea of red as investors assessed the release of key inflation data for the region. Singapore and Malaysia both released key inflation reports that came in higher than anticipated while Tokyo’s inflation numbers are due to be released on Friday. Japan’s Nikkei fell 1.16% on Monday, Hong Kong’s Hang Seng fell 0.16%, and South Korea’s Kospi slid 0.4% at the closing bell.
Locally yesterday, the ASX200 rallied 0.5% to push the key index above 7800 points again, led by a rise in interest rate sensitive sectors like technology and REIT stocks as optimism for interest rate cuts continues to rise. The rise in sentiment follows a statement released on the back of the RBA’s latest meeting indicating Australia’s central bank appears to be less hawkish than first though with regards to interest rate cuts.
The rising price of oil prompted investors to buy back into the mining giants like Santos which added 1.1% and Woodside which rose 1.2% on Monday.
Reports out of Fortescue that the mining giant is looking to develop its copper assets led to a 3.2% rise in the Andrew Forrest run mining company on Monday.
What to watch today:
- Ahead of Tuesday’s trading session here in Australia, the SPI futures are expecting the ASX to open the session 0.37% lower following the slide on Wall St overnight.
- On the commodities front this morning oil is trading 1.55% higher at US$81.88/barrel, gold is up 0.32% at US$2171/ounce, and iron ore is trading flat at US$111.50/tonne.
- AU$1.00 is buying US$0.65, 99 Japanese Yen, 51.69 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has initiated coverage of Cleanaway Waste Management (ASX:CWY) with a buy rating and a 12-month price target of $3.10 with Bell Potter’s analyst optimistic on the growth opportunity for CWY through its three-year pathway to $450m+ EBIT under its ‘Blueprint 2030’ strategy. The analyst also expects to see recovery in C&I waste generation and labour productivity potentially presenting as further tailwinds.
- And Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 20 days which is roughly the same amount of time the share price may rise from the close of $5.34 to the range of $5.82 to $5.92 according to standard principles of technical analysis.
Despite a mixed session on Friday, Wall Street posted gains across the three key indices for last week with the Dow Jones recording its best week since December and the market is on track for a fifth consecutive month of gains. Investors took a slight breather on Friday after a strong week for equities following the Fed’s latest FOMC meeting where interest rates were held steady again. The Dow Jones fell 0.77% on Friday but added almost 2% for the week, the S&P500 fell 0.14% on Friday but gained 2.3% for the week, and the tech-heavy Nasdaq rose 0.16% on Friday and nearly 2.9% for the week.
FedEx added more the 7% on Friday after posting adjusted earnings that beat analysts’ expectations, while Nike fell 6.9% on disappointing guidance and easing sales in China.
Over in Europe, markets closed mostly higher in the region, even after stocks soared to an all-time-high on Thursday. The STOXX600 rose 0.02% on Friday as tech and travel stock losses weighed on the market gains. Germany’s DAX rose 0.15% on Friday while the French CAC fell 0.34%, and, in the UK, the FTSE100 rose 0.61% at the week’s end. The Swiss National Bank surprised markets on Thursday by lowering its core policy rate by 0.25 percentage points to 1.5% which marks the first major economy to cut interest rates in a sign key global economies are winning the battle of inflation and further cuts could be expected in the near future. The Bank of England held rates as expected on Thursday, however, signalled rate cuts could be on the horizon soon.
Locally on Friday, the ASX200 lost 0.2% as a sell-off in commodity-related stocks, particularly energy stocks, weighed on the key index. For the week though, the ASX200 still managed to post a 1.3% gain. Declining prices of oil, iron ore and gold were the drivers of investors selling out of commodity-related stocks on Friday.
Fisher & Paykel Healthcare rallied 7.7% on Friday after the company upgraded its earnings guidance range to NZ$260m to NZ$265m mainly due to strength in demand for the company’s hospital product group and OSA masks.
What to watch today:
- Ahead of the local trading session to start the new trading week here in Australia, the SPI futures are anticipating the ASX to open Monday’s session 0.09% higher.
- On the commodities front this morning, oil is trading 0.54% lower at US$80.63/barrel, uranium is down 6.6% at US$85/pound, gold is down 0.72% at US$2165/ounce and iron ore is up 2.77% at US$111.50/tonne.
- AU$1.00 is buying 65 US$0.65, 98.60 Japanese Yen, 51.7 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has maintained a speculative buy rating on Deep Yellow (ASX:DYL) and have increased the 12-month price target on the uranium miner from $1.81 to $1.90/share following the company’s successful completion Tranche-1 or $140.5m of its $220m institutional placement with the remaining to be completed post a general meeting in April. Deep Yellow also plans to raise a further $30m via a retail share purchase plan, with total funds raised to be directed towards the advancement of the company’s Tumas uranium project in Namibia.
- And Trading Central has identified a bearish signal on Reece (ASX:REH) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may fall from the close of $27.65 to the range of $25.10 to $25.60 according to standard principles of technical analysis.
The iron ore industry has hit some turbulence. Prices have taken a nosedive this year, partly due to a slowdown in China – a big buyer of iron ore. This has influenced the Australian stock market, with mining giants like BHP and Rio Tinto feeling the heat. The US dollar and interest rates are also adding pressure. Discover what this all means for investors in this week’s Weekly Wrap video.
In this week’s wrap, Sophia covers:
• (0:11): why it may be worth keeping watch of iron ore stocks
• (0:35): Australian miners sell-off – BHP, Rio Tinto, and Fortescue
• (1:37): China’s economic slowdown and stimulus efforts
• (2:25): the impact of interest rates and the US dollar on ore prices
• (4:14): the most traded stocks & ETFs by Bell Direct clients
• (4:46): economic data to watch next week.
Wall St closed higher overnight as the major averages rise to new record levels. The Dow Jones rallied 0.68%, the S&P500 closed 0.32% higher and the tech-heavy Nasdaq ended the trading session 0.2% in the green.
Over in Europe, markets closed higher overnight as European stocks hit record highs following monetary policy decisions from the Bank of England and Swiss National Bank. The STOXX600 ended the trading session up 0.9% with nearly all sectors finishing in the green with technology stocks up 3.2%, whilst utilities fell 0.39%.
Locally yesterday, the ASX200 closed 1.12% higher with the majority of sectors finishing in the green. Gains were led by the financial and consumer discretionary sectors which rose 1.74% and 1.5% respectively. This was slightly offset by the utilities sector which fell 0.59% by market close.
Australian unemployment data was also released yesterday, down to 3.7% from the previous result of 4.1% and the consensus of 4%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.18% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 0.67% lower at US$80.72 a barrel as Ukrainian drone strikes on Russian refineries stoke supply concerns.
- Gold is trading down 0.23% to US$2180 an ounce as investors become confident central banks will ease monetary policies soon.
- And iron ore is trading flat at US$108.50 a tonne as hopes for a recovery in Chinese demand prevents a further sell off.
Trading Ideas:
- Bell Potter has maintained a speculative buy rating on Clarity Pharmaceuticals (ASX:CU6) with a current price per share of $3.00. The speculative buy rating is maintained by Bell Potter with them giving CU6 a valuation of $3.90 per share, implying a 30% share price growth in a year.
- And Trading Central has identified a bullish signal on Bega Cheese (ASX:BGA), indicating that the stock price may rise from the close of $4.15 to the range of $4.60-$4.70, on a pattern formed over 17 days according to the standard principles of technical analysis.
Wall Street rallied overnight, with all three major benchmarks notching all-time closing highs, after the Federal Reserve announced that there will be three rate cuts before the end of the year. This comes after the Fed held rates at a 23-year high. In this week’s policy meeting, rates were left unchanged however the announcement saw a market rally, with the Dow Jones rising 400 points or 1.03% to a record close, the S&P500 up 0.89% and the Nasdaq gaining 1.25%. Financial stocks and tech stocks advanced the most.
Yesterday, the Australian market closed in the red with tech, utilities, and consumer staples down the most, while energy gained.
What to watch today:
- Today however, our local market is set for a positive start following US equities overnight. The SPI futures are suggesting a 0.63% rise at the open this morning.
- In commodities,
- Oil prices have dropped to around US$81.55 per barrel at the time of recording, dropping from over four-month highs touches on Tuesday, a sell-off as investors took profits from the strong run-up in oil prices. Also, the stronger US dollar added pressure to oil prices, which makes it more expensive for buyers in other currencies, affecting demand.
- Gold on the other hand is trading in the green, currently around US$2,186 an ounce, following the Fed holding interest rates steady.
- And iron ore has advanced an impressive 3.8% to US$108.50, recovering earlier losses after hitting it’s lowest level since May 2023.
- In economic data, the unemployment rate for February will be announced today at 11:30am AEDT, expected to drop from 4.1% to 4%, after January saw the highest unemployment rate in 2 years.
- Also keep watch of the share price movements of the following companies, that are set to release their earnings reports today. These include Brickworks (ASX:BKW), Sigma Healthcare (ASX:SIG) and Washinton Soul Pattinson (ASX:SOL), while Webjet (ASX:WEB) will hold an investor briefing today.
- And companies going ex-dividend today include Cochlear (ASX:COH), Pacific Smiles Group (ASX:PSQ), Spark New Zealand (ASX:SPK) and Tourism Holdings (ASX:THL). Remember this often sees share prices fall, as investors take their profits.
Trading Ideas:
- Bell Potter maintains a Buy rating on Smartpay Holdings (ASX:SMP), an independent full-service provider of payment solutions. SMP shares have traded down despite the positive merchant data and growth in digital payments. Bell Potter have increased their price target to $1.76 and at SMP’s current share price of $1.37 this implies 28.7% share price growth in a year.
- And Trading Central have identified a bullish signal in Fortescue Metals (ASX:FMG) indicating that the stock price may rise from the close of $24.75 to the range of $29.00 to $30.00 over 17 days, according to the standard principles of technical analysis.
Wall St closed higher overnight as the Dow closed more than 300 points higher by market close. The S&P 500 rose over half a percent, the tech-heavy Nasdaq ended the trading session up 0.39% and the Dow Jones rallied 0.83%.
Over in Europe, markets closed higher as investors look to the start of the US Fed’s two-day policy meeting. The STOXX600 closed 0.26% higher with autos stocks rising 1.2%, whilst food and beverage stocks fell half a percent. Germany’s DAX rose 0.31%, the French CAC jumped 0.65% and over in the UK the FTSE100 ended Tuesday’s trading session 0.2% higher.
Locally yesterday, the ASX200 ended the day 0.36% higher with gains lead by the materials and energy sectors of 2.11% and 1.98% respectively. This was offset by the consumer staples sector which lost 0.84% by market close yesterday.
The RBA interest rate decision also came out yesterday, with it remaining at 4.35%, the same as its previous result.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.17% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 0.46% higher at US$83.10 a barrel as Iraq announced plans to reduce its oil exports to 3.3 million barrels per day in order to comply with the OPEC+ quota.
- Gold is trading 0.12% lower at US$2157 an ounce, as investors await the US Federal Reserve’s policy decision this week.
- And iron ore is trading 1.95% higher at US$104.50 a tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Nickel Industries (ASX:NIC), despite slightly decreasing the 12-month price target to $1.50. The buy rating is maintained by Bell Potter as NIC is trading on undemanding valuation multiples, offers a supportive dividend, has demonstrated its ability to make money through the nickel price cycle and is one of the worlds only listed nickel producer offering exposure across nickel products and markets.
- And Trading Central has identified a bullish signal in Tabcorp Holdings (ASX:TAH), indicating that the stock price may rise form the close of $0.80 to the range of $1.08-$1.14 on a pattern formed over 100 days, according to the standard principles of technical analysis.
Wall St closed higher overnight as markets await the US Federal Reserve decision out later in the week. The Dow Jones climbed 0.2%, the S&P 500 closed 0.63% higher and the tech-heavy Nasdaq ended the trading session 0.82% in the green.
In terms of US shares, Alphabet gained 4.6% after reports that Apple was in talks with Google to include the company’s Gemini AI in iPhones.
Over in Europe, markets closed lower as investors look ahead to the US Federal Reserve meeting. The STOXX 600 closed 0.1% lower with telecoms falling 1.4%, whilst autos rallied 0.9%. Germany’s DAX closed slightly lower, down 0.02%, the French CAC lost 0.2% and over in the UK the FTSE 100 fell 0.06%.
Locally yesterday, the ASX200 closed slightly higher, up 0.07% by market close. Gains were lead by the financial and materials sector which gained 0.56% and 0.25% respectively. This was offset by the real estate sector which lost 1.87%.
What to watch today:
- The Australian share market is set to open marginally higher, up 0.04% at market open this morning.
- In terms of economic data today, the RBA interest rate decision will be released this afternoon with the forecast and consensus coming in at 4.35%, the same as its previous result.
-
On the commodity front this morning,
- Oil is trading 2.09% higher at US$82.73 a barrel, following lower amount of exports from Iraq and Saudi Arabia as well as increased demand coming from the US and China.
- Gold is trading 0.18% higher at US$2159 an ounce as investors await policy meetings from major central banks such as the RBA and the Bank of England.
- And iron ore is trading 2.84% lower at US$102.50 cents a tonne as lower demand in China continues
Trading Ideas:
- Bell Potter maintains a buy rating on Chrysos Corporation (ASX:C79) and has a 12-month price target of $8.30. The buy rating is maintained by Bell Potter as it is believed their disruptive PhotonAssay technology will command a significant foothold within the large gold assaying markets with current lease agreements with some of the largest gold miners and international laboratory businesses providing good near-term deployment visibility.
- And Trading Central has identified a bullish signal on Nick Scali (ASX:NCK), indicating that the stock price may rise from the close of $14.50 to the range of $18.20-$18.90, on a pattern formed over 30 days, according to the standard principles of technical analysis.
Well, all three major US benchmarks closed lower last week, the second straight week of losses. This was off the back of inflation concerns which saw technology stocks come under pressure, ahead of the Fed’s next two-day policy meeting starting on Tuesday. The Dow Jones closed 0.5% lower, the S&P500 down 0.6% and the Nasdaq down 0.96%.
European markets were also in the red, with investors treading carefully ahead of rate decisions this week by both the Federal Reserve and the Bank of England.
And last week the Australian share market declined 2.25% Monday to Friday, with all sectors in the red, apart from Utilities and Real Estate. The materials and financials industry sectors declined the most.
What to watch today:
- Our local market is set to start the week lower this morning, with the SPI futures suggesting a 0.17% fall at the open.
- In commodities,
- Oil has softened, trading at US$81 per barrel, so keep watch of energy stock today, such as Woodside Energy (ASX:WDS) or Santos (ASX:STO). The price of oil still saw a weekly gain of more than 3.5%, amid strong US demand as well as an optimistic outlook for global oil consumption.
- Gold is trading lower, recording its first weekly decline in a month, ahead of the Fed’s policy decision this week.
- Iron ore has also declined, trading at US$105.50 per ton, the lowest in nearly seven months following dampened demand in China.
- And copper prices are influencing the Australian dollar greater than iron ore currently, advancing last week to its highest level in 11 months, after the top Chinese smelting facilities announced they’d reduce production at unprofitable facilities due to raw material shortages.
- And two companies go ex-dividend today, that is, HUB 24 (ASX:HUB) and Chorus (ASX:CNU).
Trading Ideas:
- Bell Potter maintains a Buy rating on global financial services firm Perpetual (ASX:PPT). They have lowered their price target from $27.33 to $27.15 and at PPT’s current share price of $24.39, this implies 11.3% share price growth in a year.
- And Bell Potter also have a Buy rating on Technology One (ASX:TNE), ahead of the company’s H1 FY24 results with a focus on the Net Revenue Retention. Bell Potter have increased their price target from $17.25 to $18.50, and at TNE’s current share price $16.30, this implies 13.5% share price growth in a year.
The spotlight shone brightly on the US economy as investors eagerly awaited the release of key economic data this week. The data would shed light on the nation's battle with inflation, a crucial factor influencing both the health of the world's largest economy and the potential actions of the Federal Reserve regarding interest rates in the coming months.
In this week’s wrap, Grady covers:
- (0:09): why investors were fixated on the US this week
- (0:53): conflicting signals between US retail sales and PPI data
- (2:18): investor optimism despite slight rise in US inflation
- (2:34): the mining giant sell-off locally as iron ore slumped
- (3:08): a glimpse of recovery amidst challenges for Myer
- (5:06): the most traded stocks & ETFs by Bell Direct clients
- (5:35): economic data to watch next week.
Wall St closed lower overnight following the release of inflation data that came out higher than expectations. The Dow Jones fell 0.35%, the S&P500 lost 0.29% and the tech-heavy Nasdaq ended the day 0.3% in the red.
US producer price index for February came out overnight, showing a 0.6% rise month on month, double the consensus and forecast of 0.3%.
Over in Europe, markets closed lower following further inflation readings coming out of the US. The STOXX600 closed down 0.2% with media stocks ending the session 0.7% higher and mining stocks falling 1.4%. Germany’s DAX fell 0.11%, the FTSE100 fell 0.37% with the French CAC gaining 0.29%.
Locally yesterday, the ASX200 fell 0.20% by market close yesterday. Losses were lead by the financial and consumer discretionary sectors which lost 1.88% and 0.73% respectively. This was offset by the materials sector which rallied 1.85% by the end of the trading session.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.73% at market open this morning.
-
On the commodity front this morning,
- Oil is trading 1.72% higher to US$81.09 cents a barrel as the IEA increased its 2024 demand-growth estimation for crude oil to 1.3 million barrels from 1.2 million.
- Gold is trading lower just over half a percent at US$2162 an ounce as the US inflation reading overnight made investors question the Fed’s interest rate cuts.
- And iron ore is trading 3.15% lower at US$107.50 cents a tonne.
Trading Ideas:
- Bell Potter has initiated coverage on McMillan Shakespeare (ASX:MMS) and has a buy recommendation with a 12-month price target of $22.52. McMillan Shakespeare is a leading provider of employee benefits within remuneration packages and operated commercial fleets and disability support services. It has been initiated as a buy rating as MMS provides a unique exposure to a growing demand profile for renewable fuels and vehicle electrification on the ASX. Australia will need to achieve more than 50% of new EV sales by 2030 to meet current climate targets.
- And Trading Central has identified a bearish signal in Tourism Holdings (ASX:THL), indicating that the stock price may fall form the close of $3.10 to the range of $2.25-$2.40 on a pattern formed over 183 days, according to the standard principles of technical analysis.
US markets closed mixed overnight, with the Dow Jones closing slightly higher, just 0.1% in the green, while the S&P500 closed 0.2% lower and the Nasdaq down 0.5%, as the information technology sector slipped 1.1% with Nividia, Meta and Apple shares all lower.
The US consumer price index, a broad measure of goods and services costs, increased 0.4% for the month and 3.2% from a year ago. The monthly measure was in line with expectations while the 12-month reading was slightly higher.
European markets ended higher, following what was a mixed trading session, as investors considered the latest U.S. inflation data as well as U.K. gross domestic product. GDP increased 0.2% in line with forecasts.
What to watch today:
- The Australian share market is set to open higher this morning, with the SPI futures suggesting a rise of 0.28%.
- In commodities,
- The price of oil is up 2.7% to US$79 per barrel after US data saw an unexpected decrease in crude stocks.
- Gold has advanced 0.8% after losing for than 1% in the previous session, amid US inflation data being released.
- And iron ore is also in the green, trading at US$111 per tonne, so keep watch of iron ore miners.
- And some companies set to go ex- dividend today include Breville Group Ltd (ASX: BRG), auto retailer Eagers Automotive (ASX: APE), poultry producer Inghams Group Ltd (ASX: ING), and telco TPG Telecom Ltd (ASX: TPG).
Trading Ideas:
- Bell potter maintains a Speculative Buy rating on Liontown Resources (ASX:LTR) after the mining company accounted that it has executed a $550 million senior secured syndicated debt facility, funding its Kathleen Valley lithium project to first production. The Kathleen Valley project remains highly strategic in its stage of development, long mine life and location. And Bell Potter recognise the higher level of risk with their Speculative risk rating as it's an asset development company. They have lifted their valuation from $1.60 to $1.90 per share, and at LTR's current share price of $1.39, this implies 36% share price growth in a year.
- And Trading Central have identified a bullish signal in Resimac Group (ASX:RMC), indicating that the stock price may rise from the close of $0.98 to the range of $1.24 - $1.30 over 26 days, according to the standard principles of technical analysis.
Wall St closed higher overnight as stocks resumed the recent rally after key inflation data came in-line with expectations. The Dow Jones climbed 0.61%, the S&P500 traded 1.12% higher and the tech-heavy Nasdaq rose 1.54%. Investors took confidence in the slight rise in inflation through the latest CPI data, indicating core inflation rose 0.4% in February from January and 3.8% year-on-year, while the inflation rate in the US rose just 0.1% to 3.2% in February.
Over in Europe, markets closed higher in the region as investors responded to the latest US inflation data report. The STOXX600 rose 1% driven by automotive stocks while Germany’s DAX rose 1.23%, the French CAC added 0.84% and, over in the UK, the FTSE100 gained 1.02% on Tuesday.
British unemployment rate data came out yesterday indicated a rise to 3.9% for January from 3.8% in December and slowing wage growth which provide further supportive evidence for interest rate cuts to come.
Locally yesterday, the ASX ended Tuesday’s rollercoaster session 0.1% higher after a morning rally was overturned in midday trade by a US-inflation data fear driven sell off, before settling the day up 0.1%. Gains were led by the information technology and utilities sectors which rose 1.15% and 0.88% respectively. This was offset by the energy sector which lost 0.77%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.18% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.16% higher at US$78.05 cents a barrel following OPEC’s optimistic outlook on global oil demand growth in 2024 and 2025.
- Gold is trading 1.1% lower at US$2158 an ounce, following US inflation data coming back slightly above expectations.
- And iron ore is trading down 5.96% to US$110.50 a tonne following subdued demand in China causing a cautious approach among steelmakers who are hesitant on restocking supply.
Trading Ideas:
- Bell Potter has maintained a buy rating on Telstra Group (ASX:TLS) and has an unchanged 12-month price target of $4.25. The buy rating is maintained by Bell Potter as the FY24 results are seen as a potential catalyst to meet the guidance with the highlights being continued strong growth in the core mobile and infrastructure businesses and signs of some turnaround in Enterprise.
- And Trading Central has identified a bullish signal in GUD Holdings (ASX:GUD), indicating that the stock price may rise from the close of $11.42 to the close of $13.40-$13.90, on a pattern formed over 25 days according to the standard principles of technical analysis.
Wall St fell overnight as investors await important US inflation data out on Tuesday. The S&P 500 finished the day 0.11% lower, as did the tech-heavy Nasdaq which closed 0.41% in the red. Whilst the Dow Jones added 0.12% by the closing bell. These losses come as CPI data for last month will be released in the US on Tuesday with economists predicting CPI will rise 0.4% between January and February and 3.1% on an annual basis.
Over in Europe, markets closed lower overnight to start the new trading week. The STOXX600 closed 0.4% lower with technology stocks losing 2.1% while food and beverage stocks added 0.3%. Germany’s DAX fell 0.38%, the French CAC lost 0.1% and over in the UK the FTSE100 gained 0.12%.
Locally yesterday, the ASX200 closed the trading session down 1.82% with all sectors ending in the red. Losses were led by the materials and financial sectors which fell 2.56% and 2.17% respectively.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.06% at market open this morning.
- Australian inflation data will be released this morning with core inflation month on month forecasted at 0.3%, slowing from the 0.4% in the previous month.
-
On the commodities front this morning,
- Oil is trading up 0.04% at US$78.04 a barrel ahead of important US inflation data and monthly OPEC reports to be released this week.
- Gold is trading 0.24% higher at US$2182 an ounce and iron ore is trading 0.84% lower at US$117.50 a tonne.
What to watch today:
- Bell Potter maintains a buy rating on Paragon Care (ASX:PGC) and has increased its price target to $0.31. The buy rating is maintained by Bell Potter as Paragon Care have entered into a share sale agreement with the privately owned CH2, whereby PGC will acquire all CH2 shares, with the merger transaction highly likely to proceed. The valuation is based on the full year proforma earnings for the merged group using a capitalised earnings model of 8x post-merger EBITDA, inclusive of $8m in revenue and cost synergies.
- And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU), indicating the stock price may rise from the close of $14.77 to the range of $17-$17.50 on a pattern formed over 126 days, according to the standard principles of technical analysis.
Wall St fell on Friday as the Dow Jones closed out its worst week since October losing 0.18% by the closing bell. The S&P 500 lost 0.65% and the tech-heavy Nasdaq fell 1.16%. US unemployment data was also released on Friday coming in at 3.9%, 0.2% higher than the forecast and consensus of 3.7%.
In terms of US stocks, despite rising 6% over the week, Nvidia lost 5% in its worst session since last May.
Over in Europe, markets closed mix following the European Central Bank’s inflation forecast and US jobs data release. The STOXX 600 closed 0.03% higher, led by the financial sector which gained 1%, whilst the technology sector lost 1.5%. Germany’s DAX closed 0.16% lower, as did the FTSE 100 which fell 0.43%, whilst the French CAC gained 0.15%.
Locally on Friday, the ASX200 gained over 1% with all but the industrial sector finishing in the green. Gains were led by the financial and health sectors up 2.03% and 1.25% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.6% at market open this morning.
-
On the commodity front this morning,
- Oil is down 1.17% to US$78.01 a barrel as the market remains cautious on Chinese demand, despite the OPEC+ group extending supply cuts.
- Gold is up 0.9% to US$2178 and ounce and iron ore is trading 0.85% higher at US$118.50 a barrel.
Trading Ideas:
- Bell Potter has maintained a buy rating on Develop Global (ASX:DVP), despite decreasing its price target to $4.10. The buy rating is maintained by Bell Potter as the forthcoming restart of Woodlawn operations coincides with growing revenue generation from the company’s underground mining services business, underpinning a ramp up in earnings in FY24-FY26.
- And Trading Central has identified a bullish signal in Infomedia (ASX:IFM), indicating that the stock price may rise from the close of $1.65 to the range of $1.90-$1.96, on a pattern formed over 11 days, according to the standard principles of technical analysis.
The stock market isn’t always smooth sailing, reacting not just to company performance but also to the ever-shifting tides of global events. Geopolitical tensions from ongoing wars to escalating cyber threats, can create uncertainty and market volatility. However, for investors, this doesn’t necessarily translate to negative outcomes. By understanding the risks and focusing on long-term strategies, investors can navigate these choppy waters and position themselves for continued growth.
In this week’s wrap, Sophia covers:
- (0:28): the importance of long-term wealth building strategies
- (1:07): major geopolitical risks
- (1:22): cybersecurity in the investment landscape
- (1:55): impacts of US-China tensions on markets
- (2:29): why the energy sector is one to watch
- (4:00): the most traded stocks & ETFs by Bell Direct clients
- (4:34): economic data to watch next week.
Wall St closed higher overnight as the S&P 500 and the Nasdaq hit new records. The Dow Jones rose 0.35%, the S&P 500 jumped just over 1% and the tech-heavy Nasdaq rallied over 1.5%.
Over in Europe, markets closed higher overnight as the European Central Bank’s held its interest rates steady at a record 4% and revised inflation in 2024 to 2.3% from 2.7%. Germany’s DAX finished 0.71% higher, the French CAC gained 0.77% and over in the UK the FTSE100 ended the trading session 0.17% in the green.
Locally yesterday, the ASX200 closed 0.39% higher as the vast majority of sectors finished in the green. Gains were led by the industrial and information technology sectors which rallied by 1.33% and 1.03% respectively. This was slightly offset by the energy sector which lost 1.15% by the closing bell.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.63% at market open this morning.
-
On the commodities front this morning,
- Oil is down 0.2% to US$78.97 a barrel as the latest EIA report showed a smaller-than-expected increase in US crude inventories.
- Gold is up 0.47% to US$2158 an ounce as investors await key US jobs data on Friday.
- And iron ore is trading 1.29% higher at US$117.50 a tonne.
Trading ideas:
- Bell Potter has maintained a speculative buy rating on WA1 Resources (ASX:WA1) with a valuation of $17.65. WA1 is advancing the West Arunta Niobium project which includes the Luni prospect in North-Western Australia. Luni has the potential to be a globally significant Tier-1 asset characterised by its high-grade and scale.
- And Trading Central has identified a bullish signal on Abacus Group (ASX:ABG), indicating that the stock price may rise from the close of $1.16 to the range of $1.25-$1.27 on a pattern formed over 37 days, according to the standard principles of technical analysis.
It was a positive session on Wall Street overnight, with the market turning a corner after a few consecutive losing sessions. with the Dow Jones up 0.2%, the S&P500 up 0.5% and the Nasdaq up 0.6%.
European markets also advanced with all major benchmarks closing in the green.
What to watch today:
- The Australian share market is set to open higher this morning, with the SPI futures suggesting a 0.48% rise at the open.
- In commodities,
- The price of oil is up 1.3%, just over US$79 per barrel, nearing a four-month high after the Energy Information Administration showed a smaller than expected increase in US weekly crude stocks.
- Gold is steady, hovering at its record high of US$2,146 an ounce.
- And iron ore is flat at US$116 per ton, the lowest since late October.
- BHP’s share price may trade lower today as the mining giant’s shares are set to trade ex-dividend this morning. Other stocks going ex-dividend today include Rio Tinto (ASX:RIO), South 32 (ASX:S32), Woodside Energy (ASX:WDS) and Viva energy Group (ASX:VEA), just to name a few.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Clarity Pharmaceuticals (ASX:CU6) and has increased its valuation to $3.90. The buy rating is maintained as CU6 have a clinical advantage over currently marketed PSMA targeted imaging agents. The stock’s current share price if $2.85, which implies 36.8% share price growth in a year.
- And Trading Central has identified a bullish signal on Metcash (ASX:MTS), indicating that the stock price may rise from the close of $3.76 to the range of $3.99-$4.05, on a pattern formed over 16 days, according to the standard principles of technical analysis.
Wall St fell overnight as Apple shares declined, pulling technology stocks down. The Dow Jones and the S&P 500 lost just over 1% each with the tech-heavy Nasdaq ending the session 1.65% in the red. Apple lost 3% following the release of a report from Counterpoint Research that showed iPhone sales in China plunged in the first six weeks of 2024.
Other tech stocks such as Netflix and Microsoft also fell by more than 2% each with Tesla following suit, losing 3%.
Over in Europe, markets closed lower as they struggle to find positive momentum with investors awaiting the ECB meeting later in the week. The STOXX600 ended the day down 0.27% with the majority of sectors closing lower with mining stocks falling 0.9% whilst the utilities sector added 1.8%. Germany’s DAX closed 0.1% lower, the French CAC fell 0.3% and over in the UK the FTSE100 closed 0.08% in the green.
Locally yesterday, the ASX200 fell 0.15% with the consumer discretionary and consumer staples sector leading losses down 1.21% and 1.05% respectively. This was offset by the health sector which gained 1% by the closing bell.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall 0.26% at market open this morning.
- In terms of economic news, Australian GDP growth data will be released this morning with a forecast of 0.2% growth quarter on quarter, the same as its previous result.
-
On the commodities front this morning,
- Oil is trading 0.65% lower at US$78.23 a barrel as uncertainties surrounding interest rates changes in major economies, add to market uncertainty.
- Gold is trading 0.7% higher at US$2129 an ounce and iron ore is trading 1.28% lower at US$116 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on GrainCorp (ASX:GNC) and has an unchanged 12-month price target of $9.30. The buy rating is maintained by Bell Potter as they continue to view the GrainCorp share price as not reflecting the underlying improvement in through the cycle earnings and GrainCorp has a stronger balance sheet position of $350m in net corporate cash.
- And Trading Central has identified a bearish signal in Australian United Investment (ASX:AUI), indicating that the stock may fall from the close of $9.91 to the range of $9.48-$9.56 on a pattern formed over 8 days according to the standard principles of technical analysis.
Wall St closed lower overnight, despite a rally in AI stocks as part of the artificial intelligence boom. The S&P500 lost 0.12%, the Dow Jones fell 0.25% and the tech-heavy Nasdaq ended the trading session 0.41% lower. These losses were pulled back by AI company Nvidia, which soared 18% as the S&P Dow Jones indices revealed it would join the S&P 500 later this month.
Over in Europe, markets closed slightly lower as investors await the European Central Bank meeting. The STOXX600 closed 0.07% lower with most stocks closing in the red including mining stocks which fell 1.24% with tech stocks gaining 0.8%. Germany’s DAX closed 0.11% lower, the French CAC gained 0.28% and over in the UK the FTSE100 closed just over half a percent down.
Locally yesterday, markets closed 0.13% lower as the majority of sectors finished in the red. Losses were led by the health and utilities sector which lost 0.78% and 0.77% respectively. This was slightly offset by the real estate sector which gained 1.34%.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.05% at the open this morning.
-
On the commodity front this morning,
- Oil is trading down 1.54% at US$78.13 a barrel after OPEC and its allies agreed to extend voluntary production cuts until the end of June.
- Gold is trading 1.62% higher to US$2117 an ounce and iron ore is trading flat at US$117.50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on DroneShield (ASX:DRO) with a 12-month price target of $0.90. The buy rating is maintained by Bell Potter as DroneShield is now a profitable growth company after its first profitable year with an NPAT of $9.3m. The company is also exposed to relevant investment trends, including rising defence expenditure globally, the increasing risk of drones and the role of AI/ML technology.
- And Trading Central has identified a bullish signal in Piedmont Lithium (ASX:PLL), indicating that the stock price may rise from the close of $0.24 to the range of $0.28-$0.30, on a pattern formed over 21 days, according to the standard principles of technical analysis.
Well, it was a positive session on Wall Street, with all three major benchmarks closing in the green on Friday. The tech-heavy Nasdaq surged more than 1%, to an all-time high, surpassing its 2021 record as investors look to tech stocks amid the AI boom. Meanwhile the Dow Jones gained 0.23% and the S&P500 gained 0.8%.
Locally, the ASX200 ended the week with a 1.3% gain, with the tech sector leading the market, up 8% Monday to Friday.
What to watch today:
- The Australian share market is set to rise 0.14% at the open this morning.
- In commodities,
- The oil price is up more than 2%, at US$79 per barrel, the highest in four months, driven by expectations that OPEC+ will extend supply cuts. Investors seem optimistic for the upcoming OPEC meeting in March.
- The gold price hit a two-month high as the US dollar weakens, as well as lower Treasury yields and hopes of rate cuts.
- While iron ore declined 0.8% to US$117.50 per tonne, the lowest since October, amid the downturn in China’s property market.
- And there are around a dozen companies going ex-dividend today, including Propel Funeral Partners (ASX:PFP), REA Group (ASX:REA), Steadfast Group (ASX:SDF) and Netwealth Group (ASX:NWL). This often sees share prices fall, as investors take their profits.
Trading Ideas:
- Bell Potter maintains a buy rating on Neuren Pharmaceuticals (ASX:NEU). The company develop drugs targeting disorders of the Central Nervous System. Bell Potters 12-month price target remains unchanged at $27, following the company’s Q4 update. NEU’s current share price if $19.36, so this implies 39.5% share price growth in the year.
- And Trading Central has identified a bullish signal in Deterra Royalties (ASX:DRR), indicating that the stock price may rise from the close of $5.06, to the range of $5.65 to $5.80 over 33 days, according to the standard principles of technical analysis.
As we approach the close of the February 2024 reporting season, 346 companies have shared their results, offering a mixed bag of beats, meets, and misses. While investor sentiment has been volatile, with share prices reacting dramatically to both positive and negative news, brokers have been more cautious, issuing slightly more downgrades than upgrades. So, what were the key themes that emerged during the first half that will shape the second half of the year?
In this week’s wrap, Grady covers:
- (0:53): why Harvey Norman is rallying despite slowdown
- (1:56): which retailers are winning as consumer spending eases
- (2:18): mixed results for Ramsay Healthcare & ResMed
- (3:50): how commodity prices are keeping miners on edge
- (4:33): key themes that will continue into second half of FY24
- (6:28): the most traded stocks & ETFs by Bell Direct clients
- (7:02): economic data to watch next week.
Wall St closed higher overnight as investors shrugged off unfavourable key inflation data to post gains across the key indices which remain in line for a winning month. The inflation data reading came in the form of US core PCE prices which excludes food and energy increasing by 0.4% from the previous month, while rising at an annual rate of 2.8%, indicating inflation in the world’s largest economy remains sticky. GDP growth data was also released on Wednesday, indicating the US economy grew by 3.2% in Q4 which was slightly less than economists were expecting and well below the 4.9% growth recorded in Q3. The Dow Jones ended Thursday’s trading session 0.15% higher, the S&P 500 gained just over half a percent and the tech-heavy Nasdaq rallied 0.84%.
Over in Europe, markets closed slightly higher as investors reacted to key inflation reports. The STOXX600 closed 0.1% higher with construction stocks leading gains, up 1.2% whilst healthcare and food and beverage stocks both fell 0.7%. Germany’s DAX closed 0.44% higher, the French CAC closed down 0.34% and over in the UK, the FTSE100 ended the trading session 0.07% in the green.
Locally yesterday, the ASX200 closed half a percent higher with all but the utilities sector ending the trading session higher. Real estate and the consumer discretionary sectors lead gains up 1.73% and 1.29% respectively whilst the utilities sector fell 0.33%.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.04% at market open this morning.
- On the commodities front this morning,
- Oil is trading 0.4% lower at US$78.22 cents a barrel as investors await the OPEC+ meeting in March where discussions will be held on the ongoing output cuts.
- Gold is trading 0.47% higher at US$2044 an ounce and iron ore is trading 0.84% lower at US$118.50 a tonne following a decline in home sales in China, consequently lowering margins for steel furnaces, meaning input buying declined.
Trading Ideas:
- Bell Potter maintains a buy rating on Electro Optic Systems (ASX:EOS) and has increased its price target from $1.60 to $2.30. The buy rating is maintained following strong CY23 results which saw a return to positive EBITDA earlier than was forecasted. The company is currently experiencing substantial price growth and with a reduced cost base, Bell Potter has upgraded their EBITDA margin forecasts to 6%, 10.5% and 12% in CY24, CY25 and CY26, respectively.
- And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU), indicating that the stock price may rise from the close of $1.75 to the range of $1.93-$1.97, on a pattern formed over 8 days, according to the standard principles of technical analysis.
Wall St has closed lower for the third straight day as investors await Important inflation data coming out later in the week. The Dow Jones lost 0.06%, the S&P500 dropped 0.17% and the tech-heavy Nasdaq ended the trading session 0.55% lower.
Over in Europe, markets closed lower as cautious investment sentiment continued on from earlier in the week. The STOXX600 closed 0.3% lower with the majority of sectors ending the trading session in the red. Losses were led by technology stocks which lost 1.4%, whilst auto stocks rose by almost 1%. Germany’s DAX gained 0.25%, the French CAC gained 0.08% and over in the UK the FTSE100 closed 0.76% lower.
Locally yesterday, the ASX200 closed 0.03% lower with the consumer staples sector leading losses, down 0.81%. This was offset by the information technology sector which rallied 2.88% by the closing bell. Also yesterday, CPI data for January was released with it staying steady at 3.4%, the same as the previous month, 0.2% lower than the consensus and forecast of 3.6%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.25% at the open this morning.
- On the commodity front this morning,
- Oil is trading over half a percent lower at US$78.44 cents a barrel, with the latest EIA report showing a higher-then-expected 4.199 million barrel rise in US crude oil inventories last week.
- Gold is trading 0.20% higher at US$2033 an ounce and iron ore is trading flat at US$119.50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating of Cyclopharm (ASX:CYC) and has kept its 12-month price target steady at $3.80. The buy rating is maintained following strong earnings results in which commercial revenue increased by 14%. As well, short term catalysts include the announcement of first patient images from the US and subsequent contract signings of which are at various stages of approval.
- And Trading Central has identified a bullish signal on Abacus Group (ASX:ABG), indicating that the stock price may rise from the close of $1.14 to the range of $1.16-$1.18, on a pattern formed over 19 days, according to the standard principles of technical analysis.
Wall Street reversed morning losses to close mostly higher on Tuesday as investors prepare for the release of key inflation data later this week. The Dow Jones fell 0.25% while the S&P500 added 0.17% and the tech-heavy Nasdaq gained 0.37% on Tuesday. Retail giant Macy’s is up more than 3% during the session after announcing it would close around 150 of its struggling bricks and mortar retail stores following a revenue miss in the prior quarter.
In Europe overnight, markets closed mixed in the region as investors await key inflation data out later this week to determine how key global economies are faring in the high interest rate environment. The STOXX600 reversed Tuesday’s losses to close 0.2% higher, buoyed by mining stocks rising 1.7%. Germany’s DAX ended the day up 0.76%, the French CAC rose 0.23%, and, in the UK, the FTSE100 closed the session virtually flat.
Across the Asia markets, trading was mixed on Tuesday with Hong Kong’s Hang Seng rising just shy of 1% while Korea’s KOSPI index fell 0.83% and Japan’s Nikkei closed flat. China’s CSI 300 index rose 1.2% as shares of Chinese electric vehicle maker Li Auto soared over 22% after the company reported a 2068% increase in net income in Q4 compared to a year ago.
The local market recovered from a morning sell-off to close Tuesday’s session 0.13% higher as a 2.15% surge in consumer staples stocks more than offset losses among real estate and utilities companies. The materials sector was also weighed down yesterday as the big iron ore miners were sold off on the declining price of iron ore.
As the theme goes lately on the local market, reporting season results dominated share market moves yesterday.
Supermarket giant Coles rallied yesterday after releasing a strong first half result including a 3.7% jump in sales revenue to $22.2bn, and the outlook for momentum to continue into the second half with sales up 4.9% during the first 8-weeks of the second half already.
A stronger-than-expected first half result also prompted investors to send shares in Aussie plumbing parts and services company, Reece, rocketing over 18% yesterday. The company revealed a 2.5% rise in sales revenue, a 6% increase in NPAT and declared an interim dividend of 8cps.
Payment service providers like Zip Co and Tyro Payments both posted beats across their respective first half results, however, investors took the opportunity to collect some profits in the days after the results were released as both companies faced turbulence over the last few years during the rising interest rate and uncertain economic environment.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open the midweek session up 0.28% tracking global gains overnight.
- On the commodities front this morning, oil has rebounded to trade 0.56% higher at US$78.02/barrel, gold is up just 0.06% at US$2032/ounce and iron ore is down 3.24% at US$119.50/tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Cooper Energy (ASX:COE) and has slightly increased the 12-month price target from 16cps to 18cps on the release of the energy exploration and development company’s first half result including EBITDAX and NPAT topping BPe, while statutory NPAT came in at a loss of $91m. Bell Potter’s analyst sees there are promising signs at the company’s Orbost Gas processing plant with production continuing to increase at a time of short-term positive catalysts including higher realised gas prices.
- And Trading Central has identified a bullish signal on GUD Holdings (ASX:GUD) following the formation of a pattern over a period of 8-days which is roughly the same amount of time the share price may rise from the close of $11.14 to the range of $12.30-$12.60 according to standard principles of technical analysis.
The ASX started the week up 0.1% at the closing bell on Monday as investor sentiment was boosted by some strong corporate earnings results and the local index took lead from Wall Street’s record close on Friday. The energy sector weighed on yesterday’s gains following a decline in the price of oil overnight.
The consumer discretionary sector on the other hand was the top performer yesterday as Wesfarmers rose 1.5% while fashion jewellery leader Lovisa rallied a further 4.5% after releasing strong first half results late last week. Kogan.com also surged 23.7% after reinstating its dividend and returning to profitability in the first half of FY24 against challenging headwinds of slowing consumer spend.
Reporting season continued yesterday in the final weeks of earnings results being released locally. 251 companies have reported so far with 91 beating expectations, 93 meeting expectations and 67 missing expectations.
TPG Telecom shares tanked over 10% after the IT internet and communications company reported annual net profit shrunk to $49m from $513m a year earlier amid rising costs.
Endeavour Group was in a similar boat yesterday as investors also hit the sell button after the alcohol and hotels retailer reported its net profit fell 3.6% over the first half due to higher financing costs.
Over in the US today overnight, stocks reversed morning gains to close lower following record setting closes for the Dow and S&P500 on Friday and as investors await the release of key inflation data out in the region later this week. The Dow Jones fell 0.16% the S&P500 dropped 0.38% and the tech-heavy Nasdaq posted 0.13% decline on Monday. On the back of Nvidia’s blockbuster results out last week, investors are assessing whether the AI momentum can last, given economic and inflation risks continue to linger, and later this week when personal consumption expenditures data is released, we will gauge the impact on the AI thematic.
In Europe overnight, markets started the week in mostly negative territory as investors look ahead to key global inflation data out later this week to determine the rate outlook for key economies. The STOXX600 fell 0.4% following a record close last week, weighed down by the mining and utilities sectors. Germany’s DAX rose 0.02% on Monday, the French CAC fell 0.46% and, in the UK, the FTSE100 lost 0.3%.
Across the Asia markets, Japan’s Nikkei 225 extended its rally to a new all-time high on Monday while China markets snapped a 9-day winning streak to close 1.04% lower as investors await the release of key economic data in the region including China’s manufacturing purchasing managers’ index to gauge how economic recovery in the region is faring.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Tuesday’s session down 0.03% tracking global markets overnight.
- On the commodities front this morning, oil has rebounded from Monday’s lows to trade 1.49% higher at US$77.63/barrel, gold is down 0.2% at US$2031.73/ounce and iron ore is up 0.82% at US$123.50/tonne.
- AU$1.00 is buying US$0.65, 98.49 Japanese Yen, 51.70 British Pence and NZ$1.06.
Trading Ideas:
- Bell Potter has maintained a buy rating on NextEd Group (ASX:NXD) but has decreased the 12-month price target on the education services provider following a softer-than-expected first half result including revenue up 36% however NPAT fell and the company withdrew its second half guidance due to significant macro uncertainties across the industry.
- And Trading Central has identified a bullish signal on Capitol Health (ASX:CAJ) following the formation of a pattern over a period of 153-days which is roughly the same amount of time the share price may rise from the close of $0.27 to the range of $0.33 to $0.35 according to standard principles of technical analysis.
Wall Street ended Friday’s session with a record close across the Dow Jones and S&P500 however the tech-heavy Nasdaq fell 0.28%. For the week, the Dow Jones added 1.3%, the S&P500 rallied 1.66% and the Nasdaq rose 1.4%.
On the corporate earnings front, Afterpay parent company Block surged 16% after releasing fourth-quarter results that topped Wall Street estimates. Used car retailer Carvana also soared 32% after announcing it expects retail units to grow for the remainder of 2024.
While the tech juggernaut rally continues on the back of Nvidia’s stellar results released on Thursday, some brokers and industry experts believe there is still room for growth for the big tech stocks over the months ahead.
Over in Europe, markets in the region closed higher on Friday as corporate earnings boosted investor sentiment against the release of some unfavourable economic data. The STOXX600 rose 0.4% on Friday, Germany’s DAX added 0.28%, the French CAC climbed 0.7%, and, in the UK, the FTSE100 rallied 0.28%. Germany’s economy contracted 0.3% in the fourth quarter indicating the deepening of Germany’s economic woes as the country still battles with high inflation. In the UK, consumer confidence dipped in February as high inflation weighs on consumer optimism of an economic rebound in the near future.
Across the Asia markets on Friday, it was a mostly green finish with China stocks rising for a 9th straight session. Fresh property price data in China showed declines in property prices in the region are easing which boosted sentiment for a recovery in China’s struggling property market.
Locally on Friday, the ASX200 rose 0.4% as the tech sector boosted the market with a 1.5% rally on the back of Nvidia’s results and strong growth projections for technology companies for the remainder of 2024.
Aussie Broadband shares soared over 18% on Friday after the internet provider beat forecasts in the first half, while Jumbo Interactive shares rallied 9% after also beating expectations for the first half.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open Monday’s session 0.05% higher, extending the rally of last week into Monday.
- On the commodities front this morning, oil is trading 2.7% lower at US$76.49/barrel, gold is up 0.55% at US$2035/ounce, and iron ore is trading flat at US$122.50/tonne.
- AU$1.00 is buying US$0.66, 98.79 Japanese Yen, 51.70 British Pence and NZ$1.06.
- The local reporting season continues today with Adairs, Endeavour Group, Kogan.com, Nanosonics, TGP Telecom, and Suncorp Group will release results.
Trading Ideas:
- Bell Potter has maintained a buy rating on Accent Group (ASX:AX1) and raised the 12-month price target from $2.35 to $2.50 following the release of the leading fashion retailers’ first half results including beating Bell Potter expectations in gross margins, inventory, net debt and dividends. The first 7 weeks of the second half of FY24 has also started trading on an encouraging note.
- And staying with the retailers, Bell Potter has maintained a buy rating on leading fashion jewellery retailer Lovisa (ASX:LOV) and significantly raised the 12-month price target on the company from $26.50 to $30.70 following the release of the company’s first half results including key beats of expectations for strong gross margins and interim dividend. The second half, like Accent Group, has started on a positive note and the analyst believes the new store run-rate will ramp up into the remainder of the second half.
As we end week 3 of the local reporting season calendar, 159 companies have reported their earning results, with 57 beating expectations, 60 meeting expectations and 42 missing expectations. 22 companies have been upgraded by brokers, while 26 were downgraded, mostly due to slowing earnings growth and cost management inefficiencies across the first half. So, what were the market movers this week?
In this week’s wrap, Grady covers:
- (0:38): Pilbara Minerals (ASX:PLS) facing industry challenges as lithium prices fall
- (1:42): retail blues with Woolworths’ (ASX:WOW) turbulent week
- (2:38): NAB’s (ASX:NAB) fall in cash earnings but steady share price
- (3:20): why investors disembarked their investment in Qantas (ASX:QAN)
- (5:27): market movements this week
- (6:35): the most traded stocks & ETFs by Bell Direct clients
- (7:03): economic data to watch next week.
Wall St closed mixed overnight as investors reacted to further earnings reports. The Dow Jones and S&P 500 both rose by 0.13% with the tech-heavy Nasdaq ending the trading session down 0.32%.
Over in Europe, markets closed slightly lower as markets failed to gain any positive momentum. The STOXX600 closed 0.2% lower with the majority of sectors ending the trading session in the red. Losses were led by banks which saw a fall of 1% but this was slightly offset by autos which saw a rise of 1.6%. Germany’s DAX and the French CAC both gained 0.29% and 0.22% respectively whilst over in the UK, the FTSE100 lost 0.73%.
Locally yesterday, the ASX200 closed 0.66% lower with losses led by the consumer staples sector which fell 4.26% by the closing bell. This was offset by the information technology sector which saw a rise of 2.23% by market close.
And in some other big news locally yesterday, Woolworths CEO Brad Banducci stepped down amid a food price review with Amanda Bardwell appointed as the new CEO.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.42% at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.37% higher at US$78.08 cents a barrel as Houthi attacks on commercial vessels crossing the red sea, continue to disrupt supply logistics.
- Gold is up 0.08% to US$2025 an ounce and iron ore is trading 3.86% lower as new surveys are showing that new home sales in China have plummeted 34% since January last year.
Trading Ideas:
- Bell Potter maintains a buy rating on Retail Food Group (ASX:RFG) and has kept its 12-month price target steady at $0.13. The buy rating is maintained by Bell Potter as they continue to view RFG’s valuation as undemanding and remain positive on the potential for resilience in the business given lower average transaction values and higher volumes across the majority of the domestic business.
- And Trading Central has identified a bullish signal on SG Fleet Group (ASX:SGF), indicating that the price may rise from the close of $2.65 to the range of $2.98-$3.08 on a pattern formed over 97 days, according to the standard principles of technical analysis.
Over in the US today on this holiday shortened trading week, stocks closed Tuesday’s session lower across the board led by the tech-heavy Nasdaq declining 0.92% on investor fears of overvaluation of the tech juggernaut stocks including Amazon, Microsoft and Nvidia which is set to report after the closing bell. The Dow Jones fell 0.17% on Tuesday while the S&P500 ended the day down 0.6%.
It was a big day for M&A activity in the US on Tuesday as Capital One Financial agreed to purchase Discover Financial Services in an all-stock deal worth $35.3bn, while Walmart announced it will acquire TV maker Vizio for $2.3bn.
In Europe overnight, markets closed mostly lower across the region as investor sentiment fell on fears of a prolonged period before rate cuts both in Europe and over in the US. The STOXX600 fell 0.1%, ending a four-day winning streak, Germany’s DAX lost 0.14%, the French CAC rose 0.34% and, in the UK, the FTSE100 ended the day down 0.12%.
The ASX200 has had a pretty muted week this week with the key index closing Tuesday’s session down 0.08% as a selloff in materials and energy stocks offset the communications services sector rallying 1.5%.
It’s week three and we are in the heart of reporting season locally this February, with 95 companies having reported of which, 36 beat expectations, 33 met expectations and 26 missed expectations.
Australian mining giant BHP also weighed on the local bourse this week after reporting its lowest half-year profit in eight years, with the company blaming its struggling Aussie nickel and some overseas iron ore assets weighed on the first half performance.
Also weighing on local iron ore miners yesterday was mounting concerns over the demand outlook in China as it continues to struggle making material growth progress post pandemic, especially on its struggling property sector front.
On the banking front, Australia’s competition regulator overturned an initial ruling against a merger between ANZ and Suncorp banks yesterday to approve the merger after ANZ and Suncorp successfully appealed the original ruling. The ACCC found the deal would not hurt competition in the home, business or agribusiness lending in Australia, especially as Macquarie continues to go from strength to strength alone in the home lending market, now accounting for 5.3% of the home lending market at the end of 2023. Shares in ANZ fell 2.7% on the news while Suncorp shares rose 5.34% on Tuesday.
What to watch today:
- Ahead of the midweek trading session here in Australia, the SPI futures are expecting the ASX to open down 0.28% following the red run on Wall St overnight.
- On the commodities front this morning, oil has dropped 1.43% to trade at US$77.32/barrel, gold is up half a percent at US$2027/ounce and iron ore is up 1.17% at US$129.50/tonne.
- AU$1.00 is buying US$0.66, 98.22 Japanese Yen, 51.89 British Pence and NZ$1.06.
Trading Ideas:
- Bell Potter has downgraded the rating on Solvar (ASX:SVR) from a buy to a hold and slightly reduced the 12-month price target on the Australian consumer finance company following the release of first half results showing lower profit, the extent of weakness in New Zealand and higher bad debts.
- Trading Central has identified a bullish signal on Eagers Automotive (ASX:APE) following the formation of a pattern over a period of 112-days which is roughly the same amount of time the share price may rise from the close of $14.84 to the range of $16.90 to $17.40 according to standard principles of technical analysis.
Over in the US, Wall Street was closed on Monday due to the Presidents Day holiday, with trading to resume tomorrow.
In Europe overnight, markets closed mostly higher, carrying on the positive sentiment of last week with the STOXX600 closing the day up 0.17% driven by a rally for healthcare stocks. Germany’s DAX bucked the positive start to the week closing the session down 0.15%, while the French CAC ended the day flat and the FTSE100 in the UK rose 0.22% to start the week in the green.
In Asia, markets also closed mostly higher overnight as investors returned from the Lunar New Year holidays and upbeat travel data boosted investor sentiment. Consumer spending in China rose higher than pre-COVID levels across the Lunar New Year holiday according to data out in the region, indicating economic recovery on the consumer front is underway, which prompted China’s CSI300 index to rise 0.5% on Monday. Japan’s Nikkei and Hong Kong’s Hang Seng indices each fell to start the week lower while South Korea’s Kospi rose 1.3%.
The ASX started the week with a gain of just 0.09% on Monday as an afternoon sell off erased most of the gains from earlier in the session with real estate stocks weighing on the key index which offset gains among the miners and banks.
As we head into week three of the local reporting season calendar, so far 82 companies have reported first half results with 30 beating expectations, 31 meeting expectations and 21 missing expectations.
Lendlease was the worst performer in the real estate sector with the company plunging 16% after reporting a $136m loss for the first half and downgrading its return on equity guidance for the remainder of FY24 in results released yesterday.
The insurance providers in QBE and IAG were two key names that missed expectations and were subsequently sold off as investors responded to the weaker than expected results from the two providers.
A2 Milk on the other hand jumped 12.5% on Monday after the dairy distribution company posted stronger revenue and profits in the first half, attributing the strong results to growth in the Chinese market products.
Leading cement producer Boral also rallied 4.6% on Monday after announcing Seven Group has made an offer to buy the remaining 28.4% stake in the company that it does not already own.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Tuesday’s session flat ahead of a busy reporting season calendar today including results out of Ansell, BHP Group, Sonic Healthcare, Baby Bunting, Coronado Global Resources and more.
- On the commodities front this morning, oil is up 0.5% at US$79.57/barrel, gold is up 0.21% at US$2017.35/ounce and iron ore is flat at US$128/tonne.
- AU$1.00 dollar is buying US$0.65, 98.18 Japanese Yen, 51.83 British Pence and NZ$1.06.
Trading Ideas:
- Bell Potter has reduced the 12-month price target on Boral (ASX:BLD) from $6.30 to $6.24 and maintain a hold rating on the leading vertically integrated supplier of construction materials in Australia following the receipt of a takeover offer from Seven Group which is already a majority investor however is proposing, under the new deal, to acquire the remaining 28.4% interest that it does not own. The offer is a combination of cash and scrip and Bell Potter believes the offer proposal appears to be fair.
- And Trading Central has identified a bearish signal on PWR Holdings (ASX:PWH) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may fall from the close of $10.76 to the range of $8.80 to $9.10 according to standard principles of technical analysis.
Wall Street ended a 5-week winning streak across the key indices on Friday with the Dow Jones retreating more than 100 points as investors reassessed the outlook for the Fed to cut rates with anticipation rate cuts will come later than first expected. The S&P500 fell almost half a percent on Friday while the tech-heavy Nasdaq declined 0.82%. For the week, the key indices each posted their first loss in 5-weeks with the Dow losing 0.11%, the S&P500 shedding 0.42% and the Nasdaq declining 1.34%.
Stronger-than-expected Producer Price Index data drove investor concerns for later rate cuts as the PPI reading for January showed wholesale inflation rose 0.3% where economists were polling a 0.1% gain.
The Ten-year Treasury Yield also rose to 4.3% on Friday which added to investor’s hitting the sell button on equities in favour of safer returns through government bonds.
Over in Europe it was a different story on Friday with the key markets closing the last trading session of the week higher prompted by strong economic data indicating resilience in some markets despite the high interest rate environment. The STOXX600 rose 0.6% on Friday, Germany’s DAX added 0.42%, the French CAC closed 0.32% higher and, in the UK, the FTSE100 had the biggest gain of 1.5%. The strength in the UK on Friday was driven by retail sales coming in at month-on-month growth of 3.4% for January which is more than double what economists were expecting and follows a record decline in the December sales reading.
Across the Asia markets on Friday, Hong Kong’s Hang Seng led the gains across the Asia markets on Friday with the key index rising 2.41% while mainland Chinese markets remained closed for the Lunar New Year holidays. Japan’s Nikkei hit a fresh 34-year high, and investors in the region awaited the release of Singapore’s 2024 budget which came out later on Friday.
Locally on Friday, the ASX200 rose 0.7% and climbed 0.2% for the week, boosted by Australia’s resources sector as weakness in the US dollar fuelled a rally for gold, oil, and iron ore prices.
GQG Partners was one of the top performing stocks locally on Friday after the boutique investment manager reported it has already raised a further US$2.9bn in the first 6-weeks of 2024, while QBE and IAG insurers both fell out of favour with investors on Friday after missing analysts’ expectations in the first half.
What to watch today:
- Ahead of the first session of the new trading week, the SPI futures are expecting the local market to open Monday’s session up 0.11% tracking gains on Wall Street from Friday.
- On the commodities front this morning, oil is trading 1.5% higher at US$79.19/barrel, gold is up 0.45% at US$2013/ounce and iron ore is flat at US$128/tonne.
- AU$1.00 is buying US$0.65 cents, 98.08 Japanese Yen, 51.84 British Pence and NZ$1.07 cents.
Trading Ideas:
- Bell Potter has increased the rating on Whitehaven Coal (ASX:WHC) from a sell to a hold rating and maintained the 12-month price target of $7.65/share following the release of the company’s first half results including most metrics meeting Bell Potter estimates and the company also announced a surprise 7cps dividend. The company will also soon become the operator of large Queensland met coal assets, positively shifting the company’s commodity exposure and risk profile.
- And Trading Central has identified a bullish signal on Pilbara Minerals (ASX:PLS) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may rise from the close of $3.71 to the range of $4.06 to $4.14 according to standard principles of technical analysis.
We are now halfway through reporting season, a time when the majority of ASX-listed companies are releasing their financial results, provoking much share price movement across the market. So far this reporting season, 53 companies have reported earnings, with 23 beating market expectations, 19 in line with what analysts anticipated, while 11 missed expectations.
In this week’s wrap, Sophia covers:
- (0:39): Commonwealth Bank’s (ASX:CBA) fall in net interest margin
- (1:32): how AMP (ASX:AMP) surprised the market this week
- (2:22): why IDP Education (ASX:IEL) is on Bell Potter’s radar
- (3:05): Telstra’s (ASX:TLS) disappointing half year results
- (4:11): market movements this week so far
- (5:46): the most traded stocks & ETFs by Bell Direct clients
- (6:17): economic data to watch next week.
Wall St closed higher overnight as the S&P 500 closed at a record high rising 0.58%, tipping over the 5,000 point mark. The Dow Jones gained 0.91% and the tech-heavy Nasdaq rallied 0.3%
In terms of US stocks, Tesla and Meta both outperformed expectations which saw them rise 6% and 2% respectively.
Over in Europe, markets closed higher as investors continue to react to corporate earnings as they come in. The STOXX 600 closed 0.6% higher with constructions stocks rising 1.1% whilst oil and gas stocks fell 0.9%. Germany’s DAX gained 0.6%, the French CAC rose 0.86% and over in the UK the FTSE100 closed 0.38% higher by market close.
Locally yesterday, the ASX closed 0.77% higher, led by gains in the information technology and real estate sector of 6.81% and 3.36% respectively. This was offset by the energy sector which lost 2.10%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.94% at market open this morning.
- On the commodities front this morning,
- Oil is up 2% to US$78.17 a barrel following the release of disappointing US retail sales data, weakening the US dollar.
- Gold is up 0.59% to US$2004 an ounce and iron ore is trading flat at US$128 a tonne.
Trading Ideas:
- Bell Potter maintains a hold rating on Altium (ASX:ALU) and has increased its 12-month price target from $44 to $66.75. The hold rating is maintained following the announcement of a binding scheme implementation agreement with Renesas for the company to acquire 100% of the issued shares in Altium for consideration of $68.50 in cash. The price target has been raised to a modest discount to the offer price to allow for some risk of the scheme not proceeding.
- And Trading Central has identified a bullish signal on Magellan Financial Group (ASX:MFG), indicating that the stock price may rise from the close of $9.32 to the range of $10.60-$10.90, on a pattern formed over 29 days, according to the standard principles of technical analysis.
Wall St closed higher overnight, gaining back losses sustained in it’s previous session. The Dow Jones jumped 0.39%, the S&P 500 closed 0.96% higher and the tech-heavy Nasdaq rallied 1.30%.
In terms of US shares Lyft posted better-than-expected results in the fourth quarter which lead to a 36% jump for the ride-hailing company.
Over in Europe, markets closed higher as investors react to the latest earnings reports and inflation data coming out of the UK. The STOXX600 closed half a percent higher, led by tech stocks which added 1% with mining stocks losing half a percent. Germany’s DAX closed 0.38% higher, the French CAC gained 0.68% and over in the UK, the FTSE 100 closed 0.75% higher as UK inflation data held steady at 4% year-on-year in January.
Locally yesterday, markets closed 0.73% lower with the majority of sectors finishing in the red. Losses were led by the information technology and financial sector which lost 1.32% and 1.21% respectively. This was slightly offset by the industrial sector which saw a gain of 0.26% by market close yesterday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.63% at market open this morning.
- In terms of economic data, January unemployment data will be released this morning with a forecast of 4%, up 0.1% from its previous result.
- On the commodities front this morning,
- Oil is trading 1.71% lower at 76 US dollars and 59 cents a barrel, gold is trading 0.06% lower at 1990 US dollars an ounce and iron ore is trading flat at 128 US dollars a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Seven Group Holdings (ASX:SVW) and has increased its 12-month price target from $38 to $44.30. The buy rating is maintained following good results in the first half of FY24 and SVW being market leaders in their respective industry, with scale, brand and industry expertise underpinning commercial advantages that are hard to replicate by competitors.
- And Trading Central has identified a bearish signal on Waypoint REIT (ASX:WPR), indicating that the stock price may fall from the close of $2.47 to the range of $2.18-$2.24, on a pattern formed over 18 days, according to the standard principles of technical analysis.
Wall St closed lower overnight following the release of hotter-than-expected inflation data for January. The Dow Jones fell 1.35%, the S&P 500 lost 1.37% and the tech-heavy Nasdaq ended the day 1.8% in the red.
The consumer price index rose 0.3% in January from December and increased 3.1% on an annual basis, which was above the 0.2% month-on-month and 2.9% annual rate that economists were expecting.
Over in Europe, markets closed lower in the region following the release of some key corporate earnings results and hotter-than-expected inflation reading out of the US. The STOXX600 fell 1% on Tuesday, Germany’s DAX lost 0.92%, the French CAC closed 0.84% lower and, in the UK, the FTSE100 shed 0.81%.
The local market closed Tuesday’s session 0.15% lower, extending on Monday’s losses as the healthcare sector again weighed on the key index, while utilities, financials and discretionary stocks closed the day in the green. The market losses were slightly offset by investor sentiment rising after Westpac consumer confidence data for February came in at a rise of 6.2%, up from a 1.3% decline in January and well above what economists were expecting of a further 0.8% decline. NAB business confidence data also came in at a rise of 1 point which was in line with economists’ expectations.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 1.64% at the open this morning.
- On the commodities front this morning,
- Oil is trading over 1% higher at US$77.74 cents a barrel as tensions in the middle east help support oil prices.
- Gold is trading down 1.3% to US$1993.60 cents an ounce following stronger-than-expected inflation data coming out of the US.
- And iron ore is trading flat at US$128 a tonne.
Trading Ideas:
- Bell Potter has initiated coverage on MMA Offshore (ASX:MRM) and has recommended a buy with a 12-month price target of $2.55. MMA Offshore is an Australian-marine services business, which delivers vessel, subsea and project logistics expertise to a range of global customers. The buy rating is recommended as the offshore services market is in the midst of a boom cycle following a protracted downturn by the oil price crash in 2014 and the subsequent fall in demand.
- And Bell Potter maintains a buy rating on HealthCo. H&W REIT (ASX:HCW) despite lowering its 12-month price target to $1.70. The buy rating is maintained as HCW appears to be one of the better relative value propositions amongst the REITs sector with it being the only REIT to recognise value uplift at the half.
Wall Street closed mixed on Monday with the Dow Jones rising to a record close, building on the momentum of last week as investors responded to key earnings results and await the release of core inflation data out later this week to determine the broader picture of business and economic stability in the higher interest rate environment.
European markets started the week in positive territory across the board as investors continue responding to corporate earnings results out in the region.
The local market started the new trading week with a rollercoaster of a session as the key index rose and fell throughout the day before closing 0.4% lower as investors responded to key trading updates and reporting season results. Tech stocks took lead from the Nasdaq’s strong rally last week while consumer discretionary stocks rose on resilient results out of some big names.
Healthcare giant CSL weighed on the healthcare sector and ASX as a whole yesterday, with its shares falling over 5% on the announcement that the company’s top-line results from the Phase 3 trial evaluating the efficacy and safety of its CSL112 drug in reducing the risk of major adverse cardiovascular events in patients, did not meet its primary efficacy endpoint reduction at day 90, and that the company now has no near-term plans to file for regulatory approval of the drug candidate.
Reporting season ramped up yesterday with JB Hi-Fi rallying 7% during the session after posting results that topped analysts’ expectations. Despite revenue, profit and the company’s interim dividend all declining, investors bought into the tech retailer as the results were not as bad as were expected and reflected the company’s resilience amid the declining consumer spend environment.
Synlait Milk also disappointed investors yesterday, with shares dropping 14% after the company warned investors to brace for a net loss in the range of $17m-$21m for the six-month period ending 31st January mainly due to financing costs and changes in margins.
Rail freight operator, Aurizon, was the talk of the market yesterday after posting strong first half results including revenue up 16%, NPAT growth of 82% to $237m, EPS up 82% and increased its dividend per share by 39% to 9.7ps. Aurizon also reported a 169% rise in free cashflow, attributing the impressive first half results to a solid performance in the Network and Coal businesses and continued revenue and volume growth in Bulk and Containerised freight.
On the economic calendar today, NAB Business Confidence data for January and Westpac Consumer Confidence data for February are released this morning with the expectation of a rise in business confidence but a slide in consumer confidence.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open Tuesday’s session 0.26% higher.
- On the commodities front this morning, oil is flat at US$76.80/barrel, gold is down 0.32% at US$2017/ounce, and iron ore is flat at US$128/tonne.
- AU$1.00 is buying US$0.65, 97.62 Japanese Yen, 51.65 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has maintained a buy rating on Propel Funeral Partners (ASX:PFP) and have raised the 12-month price target on the company from $5.90 to $6.20 following the company’s successful raising of ~$90m via a $80m institutional placement and $10m non-underwritten share purchase plan at $5.15/share. Proceeds from the raising are to be used to pay down debt to provide financial flexibility to pursue further growth initiatives, including acquisitions.
- Trading Central has identified a bullish signal on JB Hi-Fi (ASX:JBH) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may rise from the close of $60.58 to the range of $60.90 to $61.90 according to standard principles of technical analysis.
Wall Street closed mixed on Friday with the S&P500 climbing 0.57% to close above 5000 points for the first time ever on Thursday as investors responded to December’s revised inflation report came in below first reported reading. The Dow Jones fell 0.14% at the closing bell while the tech-heavy Nasdaq ended the day up 1.25%. Over the 5 trading days last week the S&P500 added 1.4% in its 5th straight positive week, the Nasdaq rose 2.3% and the Dow Jones remained flat across the trading week.
The initial December inflation reading of 0.3% growth was downwardly revised on Friday to a 0.2% increase and core inflation results for the U.S. are due out this week.
Strong earnings results are also driving investor confidence in the US as tech mega caps including Nvidia and Alphabet rallied 3.6% and 2% respectively on Friday while Cloudfare soared 19.5% on strong earnings.
Over in Europe, markets closed slightly lower on Friday as investors digested corporate earnings results despite the release of favourable economic data out in the region. The STOXX600 fell just 0.08% on Friday, Germany’s DAX lost 0.22%, the French CAC dropped 0.24%, and in the UK, the FTSE100 ended the day down 0.3%.
Fresh inflation data out of Germany released on Friday indicated inflation fell to 3.1% in January in a positive sign for Europe’s largest economy.
Locally on Friday, the ASX200 rose 0.07% led by the technology sector rallying 1.12% and healthcare stocks adding 1%, while losses among energy and utilities stocks weighed on the key index.
Boral shares jumped 13% on Friday after the leading cement producer delivered very strong first half results including revenue up 9.4% and underlying NPAT soaring 143% over the 6-month period. Strong price realisation and volume recovery were the drivers of the stronger first half results.
Local uranium stocks took a hit on Friday after Canadian uranium miner Cameco announced plans to expand production at its Cigar Lake Mine and McArthur River/Key Lake, to address the growing global demand for the key commodity. Boss Energy fell 12.7% on Friday while Paladin Energy fell just over 7%.
What to watch today:
- Ahead of the local trading session here in Australia to start the new week, the ASX200 is set to open Monday’s session slightly in the red ahead of a big reporting season week locally this week.
- On the commodities front this morning, oil is trading 0.81% higher at US$76.84/barrel, gold is down 0.5% at US$2022.90/ounce, uranium is up 6% at US$106/pound and iron ore is flat at US$128/tonne.
- AU$1.00 is buying US$0.65, 97.29 Japanese Yen, 51.67 British Pence and NZ$1.06.
- On the reporting season calendar today, you can expect to see results released from Aurizon Holdings, Beach Energy, JB Hi-Fi, and James Hardie Industries.
Trading Ideas:
- Bell Potter has maintained a hold rating on REA Group (ASX:REA) and has slightly decreased the 12-month price target from $179 to $174 following the release of first half results including a 22% increase in EPS to 189cps, a 16% increase in dividend to 87cps which fell short of Bell Potter expectations. Despite the strong quarter, Bell Potter believes the current share price of $176.43 has REA Group relatively fully valued.
- And Trading Central has identified a bullish signal on Infratil (ASX:IFT) following the formation of a pattern over a period of 9-days which is roughly the same amount of time the share price may rise from the close of $10.11 to the range of $10.80 to $11/share according to standard principles of technical analysis.
Reporting season has kicked off and 13 companies released their financial results so far, with 6 beating expectations and 7 meeting expectations. In this week’s wrap we highlight the results and investor reactions to some key companies.
Locally, from Monday to Thursday, the ASX200 fell 0.78%, weighed down by the materials and energy sectors and tracking the heavy losses on global markets.
In this week’s wrap, Grady covers:
- (0:22): how Amcor’s cost controls offset the impact of lower volumes
- (0:56): what's driving performance of REITs like Centuria Industrial
- (1:28): ResMed exceeding expectations across all key metrics
- (2:11): why Champion Iron’s share price fell
- (3:09): investors impressed by Transurban’s results
- (5:42): the most traded stocks & ETFs by Bell Direct clients
- (6:14): economic data to watch next week.
Wall St closed higher overnight with the S&P 500 on the verge of reaching the 5,000 level for the first time ever. The Dow Jones rallied 0.13%, the tech-heavy Nasdaq saw a rise of 0.24% and the S&P 500 saw an increase of 0.06%.
In terms of US stocks, Disney rallied 11% after beating quarterly earnings estimates and raising its guidance.
Over in Europe, markets closed mixed as investors react to earnings. The STOXX600 closed flat with gains lead by household goods up 1.9% and losses spearheaded by health-care stocks which fell 1.9%. Germany’s DAX closed 0.25% higher, the French CAC also gained 0.71% but over in the UK, the FTSE100 fell 0.44%.
In Asia yesterday, China’s inflation rate came in at a decline of 0.8%, which is double what the forecast was and indicated the economy continues to struggle on the economic growth front, post pandemic.
Locally yesterday, markets closed 0.31% higher, led by the information technology sector which saw a rise of 1.18%. This was offset by the energy sector which lost just over half a percent by market close.
What to watch today:
- The Australian share market is set to open slightly lower, with the SPI futures suggesting a fall of 0.05% at market open this morning.
-
On the commodities front this morning,
- Oil is trading up 3.64% to US$76.55 a barrel following Israel’s decision to reject a ceasefire proposal and a decline of 3.15 million barrels in US gasoline inventories last week.
- Gold is trading 0.05% lower to US$2033 an ounce and iron ore retreated 0.39% to US$128 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Cettire (ASX:CTT) and has increased its 12-month price target to $4.80. The buy rating is maintained by Bell Potter following the release of positive results in the first half of 2024 which saw sales revenue of $354m and an adjusted EBITDA of $26m.
- And Trading Central has identified a bullish signal on Pilbara Minerals (ASX:PLS), indicating that the stock price may rise form the close of $3.62 to the range of $4.40-$4.55, on a pattern formed over 46 days, according to the standard principles of technical analysis.
Wall St closed higher overnight as investors react to further earnings season results. The S&P 500 rose 0.82%, edging closer to the 5000 level, the Dow Jones gained 0.4% and the tech-heavy Nasdaq rallied nearly 1%.
In terms of US stocks Microsoft and Nvidia added 2% each with Alphabet and Amazon rising by 1% each.
Over in Europe, markets closed lower following uncertainty over the rate cut outlook. The STOXX600 closed 0.3% lower with most sectors finishing the trading session lower. Oil and gas stocks were down 1%, with auto stocks up half a percent. Germany’s DAX fell 0.65%, the French CAC lost 0.36% and over in the UK the FTSE100 ended the trading session 0.65% lower.
Locally yesterday, markets closed 0.45% higher, with gains led by the utilities and real estate sectors of 1.74% and 1.11% respectively. This was slightly offset by the energy sector which retreated 0.95%.
What to watch today:
- The Australian share market is set to open flat at market open this morning.
- On the commodities front this morning,
- Oil is trading 1.03% higher at 74 US dollars and 7 cents a barrel as investors continue looking at the situation in the Middle East.
- Gold is trading flat at 2035 US dollars and 15 cents an ounce as investors await for further clues regarding monetary policy.
- And iron ore is trading 1.53% lower at 128 US dollars and 50 cents a tonne
Trading Ideas:
- Bell Potter maintains a buy rating on Australian Agricultural Co. (ASX:AAC) and has increased its 12-month price target to $2. The buy rating is maintained as cattle prices have rebounded strongly and US meat pricing indicators remain fairly firm. AAC is trading at a 40% discount, despite a 50% rally in the heavy steer indicator and an 87% rally in the EYCI post balance date.
- And Trading Central has identified a bullish signal on Austal Ltd (ASX:ASB), indicating that the stock price may rise from the close of $2.10 to the range of $2.37-$2.45 on a pattern formed over 33 days, according to the standard principles of technical analysis.
Wall St closed recovered some ground in afternoon trade on Tuesday to close the day mixed across the key indices as investors assessed the latest slew of corporate earnings and tried to gain further insight into the rate outlook out of the Fed. The Dow Jones rose 0.1%, the S&P500 fell 0.2% and the tech-heavy Nasdaq ended the day up 0.07%.
Technology stocks continue to outperform this reporting season in the US with Palantir Technologies soaring 19% on Tuesday after posting a revenue beat for Q4 while music streaming platform, Spotify, rose 6% after also topping expectations and posting an increase in premium subscribers.
In Europe overnight, markets rebounded to close higher as a rally for oil and gas stocks led to a positive close across markets in the region. The STOXX600 added 0.7% on Tuesday, Germany’s DAX added 0.76%, the French CAC rose 0.65% and, in the UK, the FTSE100 jumped 0.9%.
The local market extended losses into Tuesday’s session as the tech sector, which wears the full brunt of high interest rates, plunged 1.8% after the RBA did not rule out further monetary policy tightening should inflation remain high.
The RBA held the nation’s cash rate at 4.35% for the month ahead at the latest meeting yesterday as was largely expected but investors were more focused on the commentary and outlook out of the RBA to gauge an idea of when rate cuts may be on the horizon.
Inflation remaining at 4.1% is a good signal that it is easing faster than expected, however, it is still too early to assume inflation is under control. The RBA also outlined that higher interest rates are working to establish a more sustainable balance between aggregate supply and demand, and that the labour market in Australia, despite showing signs of easing, remains tight. Until the RBA sees a trend in inflation drivers coming under control over a material period, the likelihood is that the nation’s cash rate will remain on hold at 4.35%. RBA Governor, Michele Bullock, said she expects the nation’s inflation rate to fall to the target range of 2-3% by 2025.
Against all odds of declining Aussie retail spend, high interest rates and high input costs, the retailers continue to surprise with resilience as investors piled into Nick Scali and Myer on Tuesday. Nick Scali reported NPAT above the guided range for the first half of FY24 despite revenue falling in the high interest rate high cost of living environment. Myer on the other hand reported growth across most metrics and expects a strong NPAT for the first half between $49m and $53m.
What to watch today:
- Ahead of the local trading session here in Australia for Wednesday, the SPI futures are expecting the ASX to open the midweek session up 0.73%.
- On the commodities front this morning, oil is trading 0.6% higher at US$73.23/barrel, gold is up 0.55% at US$2035/ounce, uranium has fallen 5.66% to trade at US$100/pound, and iron ore is flat at US$130.50/tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on fashion jewellery company Lovisa (ASX:LOV) and raised the 12-month price target on the company from $25/share to $26.50 amid the growth opportunity in China representing the largest incremental market identified in the company’s global store rollout strategy. Since opening the first store in China in December, the Chinese fashion jewellery market alone is estimated at a value of US$13bn or 25x that of Australia which makes the market there highly attractive and a strong growth opportunity.
- And Trading Central has identified a bullish signal on Eagers Automotive (ASX:APE) following the formation of a pattern over a period of 148-days which is roughly the same amount of time the share price will rise from the close of $14.50 to the range of $17.20 to $17.80 according to standard principles of technical analysis.
Wall Street started the week lower across the key indices as treasury yields spiked on investor concerns that the Federal Reserve may not cut interest rates as much as expected and on the back of weak corporate results released dampening investor sentiment.
The Dow Jones fell 0.71%, while the S&P500 lost 0.32% and the tech-heavy Nasdaq ended the day down 0.2%. Fed Chair Jerome Powell reiterated last week at the FOMC policy meeting that a rate cut in March was unlikely, as a fresh batch of strong economic data supported the need to maintain rates higher for longer to ensure inflation doesn’t rebound.
McDonald’s fell 4% on Monday after releasing a mixed result for Q4 including slower sales which the fast-food giant has attributed to rising tensions in the Middle East.
In Europe overnight markets closed slightly lower across the board as investors digested the idea of higher rates for longer both out of the US and across Europe. The STOXX600 fell 0.14% to start the week lower, Germany’s DAX fell 0.08%, the French CAC lost 0.03%, and, in the UK, the FTSE100 dropped 0.04%.
The Asia markets also started the week mixed, where Chinese stocks rebounded from a 5-year low as the People’s Bank of China stimulus came into effect yesterday. Hong Kong’s Hang Seng ended the day flat, Japan’s Nikkei rose 0.54% and China’s CSI climbed 0.65% on Monday.
The local market started the first trading day of the new week almost 1% lower, as materials and utilities stocks weighed on the key index while every sector aside from healthcare ended the day lower.
The sell-off to start the week was mostly attributed to investors profit taking after the ASX soared to a record high close on Friday last week, and as investors await the RBA rate decision announcement today where it is widely expected that Australia’s central bank will maintain the current rate of 4.35% for another month as inflation remains above the target 2-3% range. The latest CPI report released last week indicated Australia’s quarterly inflation is easing faster than expected to a two year low of 4.1% in the 12-months to December.
In M&A news yesterday West Australian gold miner Red 5 announced it is merging with Silver Lake Resources in a deal worth $2.2bn to create a gold mining powerhouse. Under the deal, Red 5 will retain 51.7% of the merged company while Silver Lake will hold the remaining 48.3%. Red 5 shares rallied on the news while Silver Lake Resources fell over 4% on Monday.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Tuesday’s session 0.3% lower on the back of global market turbulence overnight.
- On the commodities front this morning, oil is trading 1.03% higher at US$72.99/barrel, gold is down 0.66% at US$2025/ounce and iron ore is down 2.25% at US$130.50/tonne.
- AU$1.00 is buying US$0.65, 96.41 Japanese Yen, 51.95 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has increased the rating on LGI Limited (ASX:LGI) from a hold to a buy and raised the price target from $2.32 to $2.55 following the company announcing a long-term gas management agreement with Bingo Industries and its related entity, Dial A Dump, covering Bingo’s Eastern Creek Landfill site in Western Sydney. The initial term of the agreement is 15-years with two options for 5-year extensions. Bell Potter believes the contract further validates LGI’s position as an industry leader in biogas recovery.
- And Bell Potter has increased the rating on Inghams (ASX:ING) from a hold to a buy and raised the price target from $3.95 to $4.90 following emerging tailwinds for the leading poultry producer in Australia including grain and soymeal price declines, increased production and pricing of poultry having peaked.
Wall St closed higher on Friday following the release of quarterly results from Meta which topped expectations. The Dow Jones closed 0.35% higher, the S&P 500 ended the day up, just over one percent and the tech-heavy Nasdaq rallied 1.74%.
US unemployment data was released on Friday, with it staying steady at its previous result of 3.7%, 0.1% lower than the consensus of 3.8%.
The US 10-year treasury yield jumped 4.02% after the US government announced that 353,000 jobs were added to the US economy.
Over in Europe, markets closed mix as investors react to a surprisingly strong US jobs report. The STOXX 600 closed flat with auto stocks leading gains at 1.1% whilst oil and gas stocks fell 1.4%. Germany’s DAX closed 0.35% in the green, the French CAC rose 0.05% and over in the UK the FTSE100 ended the day 0.09% in the red.
Locally on Friday, markets closed 1.47% higher to end the trading week, led by strong results from the real estate and information technology sectors which saw rises of 3.27% and 3.13% respectively. This was slightly offset by the utilities sector which lost 0.41% by the closing bell.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.7% at the open this morning.
- On the commodities front this morning,
- Oil is trading 2.09% lower to 72 US dollars and 28 cents a barrel as uncertainty in China’s economic recovery adds to the downward pressure.
- Gold is trading down 0.75% to 2039 US dollars an ounce after strong US jobs data dampens bets an early rate cut.
- And iron ore is trading up 0.38% to 133 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Nufarm (ASX:NUF) and has slightly increased its 12-month price target to $6.35. Bell Potter maintains its buy rating as Nufarm is trading at a discount to its global peer group, despite delivering stronger revenue growth rates and having exposure to high growth ESG friendly revenues in biofuels and sustainable omega-3 oils.
- And Trading Central has identified a bullish signal in Helloworld Travel (ASX:HLO), indicating that the stock price may rise from the close of $2.51 to the range of $2.69-$2.73, on a pattern formed over 44 days, according to the standard principles of technical analysis.
This week was arguably the biggest week on the US reporting season calendar. We saw some of the world’s largest tech companies release quarterly results which impacted global markets.
Investors were not impressed with some of the Magnificent 7 reports and we detail why.
In this week’s wrap, Grady covers:
- (0:11): what the Magnificent 7 stocks are
- (1:14): investor concerns with Tesla’s warning of headwinds
- (1:36): Microsoft topping expectations across all metrics
- (2:01): disappointing results from Alphabet shares
- (2:15): mixed emotions sparked by Apple, Amazon, and Meta results
- (4:02): expectations from local earnings season, retailers, iron ore miners, and AI
- (6:35): the most traded stocks & ETFs by Bell Direct clients
- (7:08): economic data to watch next week.
Wall St has closed higher as Apple and Amazon are set to release their earnings reports after the bell. The Dow Jones closed 0.97% in the green, the S&P 500 rose 1.25% and the tech-heavy Nasdaq rallied 1.30%.
In terms of US stocks, tech shares rallied with Apple and Amazon both jumping 1% and 2% respectively. Both are set to release their earnings after market close.
US unemployment data is also set to be released later tonight with a forecast of 3.7%, the same as its previous result.
Over in Europe, markets closed lower after the Bank of England held interest rates steady. The STOXX600 closed half a percent lower, led by mining stocks which fell 1.3%. Germany’s DAX lost 0.26%, the French CAC fell 0.89% and over in the UK the FTSE100 ended the day 0.11% in the red.
Locally yesterday, markets closed 1.20% lower with all major sectors finishing in the red. Losses were led by the financial and real estate sectors of 1.81% and 1.67% respectively.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.36% at market open this morning.
- On the commodity front this morning,
- Oil is trading down 2.32% to US$74.10 cents a barrel, following the OPEC committee confirming that members are maintaining production cuts.
- Gold is trading up 0.90% to US$2055 an ounce, following the release of the latest economic data coming out of the US.
- And iron ore is trading 2.21% lower at US$133 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Regal Partners (ASX:RPL), despite slightly decreasing its price target. The buy rating is maintained by Bell Potter, following net inflows in the last quarter of $108 million, largely from the launch of the Regal Resources High Conviction Fund and the Regal Partners Private Fund. With these figures and the company adding new strategies, RPL has become more diversified, hence reducing risk.
- And trading central has identified a bullish signal in Hansen Technologies (ASX:HSN), indicating that the stock price may rise from the close of $5.18 to the range of $5.47-$5.55 on a pattern formed over 38 days, according to the standard principles of technical analysis.
Wall St closed lower overnight, following the announcement from Federal reserve chairman Jerome Powell that the US central bank will not be likely to cut rates in March. The Dow Jones lost 0.82%, the S&P 500 fell 1.61% and the tech-heavy Nasdaq ended the day 2.23% in the red.
In terms of US stocks, Alphabet fell more than 6% following disappointing ad revenue results overshadowed better than expected earnings and sales.
Over in Europe, markets closed marginally higher as corporate earnings continues. The STOXX600 ended the day 0.1% higher with autos stocks up 1.1% whilst retail stocks fell 2.1%. Germany’s DAX closed 0.40% lower, the French CAC ended the trading day down 0.27% and over in the UK the FTSE100 fell just under half a percent.
Locally yesterday, markets rallied following the release of important inflation data which saw the monthly CPI indicator slow to 3.4% in December, 0.2% lower than the forecast. Markets closed just over 1% higher yesterday with all major sectors finishing in the green. The biggest gains were made by the real estate and utilities sectors which gained 2% and 1.70% respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of just over 1% at market open this morning.
- On the commodities front this morning,
- Oil is trading down 2.8% to US$75.67 a barrel after Chinese manufacturing activity contracted for the fourth consecutive month.
- Gold is down 0.11% to US$2033 an ounce, following the announcement that US interest rates will remain steady.
- And iron ore is trading 1.81% lower at US$136 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Select Harvests (ASX:SHV) and has increased its 12-month price target on the almond producer to $4.70. The buy rating is maintained by Bell Potter, following firming in the USD almond pricing and solid crop production forecasts for the upcoming season set to uplift the EBITDA over FY24-FY25.
- And Trading Central has identified a bullish signal in Stockland Corp (ASX:SGP), indicating that the stock price may rise from the close of $4.56 to the range of $4.74-$4.78 over 25 days, according to the standard principles of technical analysis.
In Europe overnight, markets extended the week’s rally into Tuesday’s session as investors assessed preliminary fourth-quarter GDP figures for the eurozone which came in at a flat reading for the third quarter, indicating the eurozone economy stabilised and narrowly missed a recession. The STOXX600 and Germany’s DAX each rose 0.18% on Tuesday, while the French CAC added just under half a %, and in the UK, the FTSE100 rose 0.44%.
Wall St closed mixed on Tuesday as investors look ahead to the Fed’s interest rate decision on Wednesday US time with markets expecting the Fed to maintain rates at the current level and not cut prematurely. The S&P500 closed flat, the Dow Jones ended the day up 0.3% and the Nasdaq fell 0.6%.
General Motors shares jumped 8% on Tuesday after the automaking giant posted better-than-expected earnings, while Starbucks shares are down in after hours trading after the coffee giant released disappointing earnings results.
In Asia, markets mostly fell on Tuesday with Hong Kong’s Hang Seng leading the losses as markets digested the fallout from the liquidation of embattled property developer, Evergrande.
The local market is hovering in record territory with the ASX closing 0.3% higher on Tuesday as earnings season ramps up and favourable economic data boosts investor sentiment for a soft landing both at home and in the US. The tech sector took strong lead from the tech-heavy Nasdaq overnight as the local high growth sector rose almost 2% yesterday.
While we are hovering around all-time index highs, it is important to realise the market gains are not across the board and some sectors are rallying against market expectations, for example China’s struggling property sector would traditionally have weighed on iron ore prices as the country Australia’s largest iron ore importer, however, the price of iron ore is us around US$135/tonne on expected stimulus out of the Chinese government.
Megaport jumped over 29% during trade yesterday after the cloud connectivity provider said its revenue increased 5% to $48.6m in the latest quarterly update.
City Chic recovered ground yesterday rising 22% as offshore buyers circle the company’s North America business.
Nickel Industries also soared 22% yesterday after the Indonesian-based nickel producer announced an increased dividend and unveiled a share buyback valued up to $151m.
Aussie retail sales data for December out yesterday came in at a decline of 2.7% which was attributed to a few reasons. Firstly, the black Friday and cyber-Monday sales period saw $9bn spent across the four days, a 22% rise on 2022, in a sign that many Aussies snapped up the bargains ahead of the December period. Additionally, the high interest rate environment we are currently in meant a lot of Aussies continue struggling with the high cost of living thus reducing discretionary spend all together, especially in the December period.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open the midweek session flat following the mixed session on Wall St overnight.
- On the commodities front this morning, oil is trading 1.4% higher at US$77.81/barrel, gold is up 0.08% at US$2033/ounce and iron ore is up 0.73% at US$138.50/tonne.
- AU$1.00 is buying US$0.66, 97.40 Japanese Yen, 52.10 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the rating on Mader Group (ASX:MAD) from a hold to a buy and has raised the 12-month price target on the leading provider of specialised contract labour following the release of the company’s December quarter update including revenues of $189.3m, which was driven by the Australia business outperforming the rest of the world with $141m. The company also reiterated FY24 revenue and NPAT guidance and paid down net debt over the period.
Wall Street rose back into record territory on Monday with the S&P500 ending the day up 0.76% at a fresh record high as investors assessed several tech giant earnings reports and ahead of the Fed’s interest rate decision announced tomorrow. The Dow Jones ended Monday’s session up 0.6% and the tech-heavy Nasdaq advanced 1.12% as we head into the busiest week of earnings results for the February reporting season. Microsoft, Apple, Meta, Amazon and Google parent company, Alphabet, are all set to release results this week which will likely spark movements for the Nasdaq, while Boeing and Merck also releasing results this week may spark movements on the Dow Jones.
As the Fed’s FOMC meeting kicks off on the 30th January US time, traders are factoring in a 97% chance the Fed will not cut rates at the January FOMC meeting. The current market sentiment is that in order to maintain the current rally on Wall Street, earnings need to meet expectations, the Fed needs to provide outlook and positive guidance on the rate front, and later this week, US jobs numbers will need to remain resilient but not too hot.
Over in Europe, markets started the week mixed ahead of key earnings results being released in the region, as well as economic data and bank announcements released later this week. The STOXX600 rose 0.2% led by oil and gas stocks rising 1%, while Germany’s DAX fell 0.12%, the French CAC lifted 0.09% and, in the UK, the FTSE100 ended the day mostly flat.
Across the Asia markets on Monday, stocks closed mostly higher ahead of key fourth-quarter GDP data out of Taiwan and Hong Kong later this week while Singapore’s central bank left its policy unchanged, as expected, on Monday. Chinese authorities have also moved to make it more difficult for investors to ‘short’ Chinese stocks as China’s stock markets have been among the worst performing in the world this year so far amid the ongoing sluggish economic recovery in the region post-pandemic.
Shares in embattled Chinese property developer, Evergrande, halted trading on Monday after Hong Kong’s high court ordered the liquidation of the company following the failure of an 11th- hour restructuring deal over the weekend.
Locally on Monday, the ASX200 rose for a sixth straight session, end the day up 0.3% at the closing bell, led by the energy sector climbing 1.83% on rising tensions in the Red Sea, while technology stocks weighed on the market.
Gold Road Resources tanked over 18% on Monday after the gold producer revealed its latest quarter production was lower QoQ due to delays accessing higher grade ore from the company’s open pit, on top of labour availability impacting the mining rate at the company’s operations.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open Tuesday’s session up 0.5% ahead of December’s retail sales data out later this morning.
- On the commodities front this morning, oil is trading down 1.3% at US$76.98/barrel, gold is up 0.65% at US$2031/ounce and iron ore is flat at US$137.50/tonne.
- AU$1.00 is buying US$0.66, 97.51 Japanese Yen, 51.97 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has maintained a buy rating on Gold Road Resources (ASX:GOR) but has lowered the 12-months price target from $2.05 to $1.80 after the gold producer released a Q4 CY23 update including production at its 50%-owned Gruyere Gold Mine had been impacted by labour availability issues and the issuance of lowered CY24 production guidance to allow for labour issues.
- And Trading Central has identified a bearish signal on Mader Group (ASX:MAD) following the formation of a pattern over a period of 99-days which is roughly the same amount of time the share price may fall from the close of $6.65 to the range of $4.20 to $4.60 according to standard principles of technical analysis.
Wall Street closed higher across the key indices on Friday as favourable economic data strengthened investor sentiment in the U.S. economy. The S&P500 rose for a sixth straight session, ending the day up 0.53%, the Dow Jones rose 0.64% and the tech-heavy Nasdaq added 0.18% despite Tesla shares slumping over 13% after the EV giant posted disappointing fourth-quarter results and warned of lower vehicle volume growth for the year ahead.
US GDP data out late last week indicated the world’s largest economy grew at a rate of 3.3% in Q4 which was well above economists’ expectations of a 2% growth and provides further support that the U.S. economy remains resilient despite the currently high interest rate environment.
Personal consumption expenditures data out of the US also pointed in the right direction for economy stability against inflation falling in fresh data out last Thursday. The PCI data, a preferred measure of inflation for the fed, showed an increase of 2% for the latest quarter.
Over in Europe, markets closed at a two-year high on Friday as investors welcomed a slew of favourable economic data, the ECB’s latest rate decision and corporate fourth quarter earnings results. The STOXX600 rose 1.1% on Friday led by household goods jumping 5.2%. Germany’s DAX ended Friday’s session up 0.32%, the French CAC added 2.28%, and, in the UK, the FTSE100 rose 1.4%.
Luxury brand retailer LVMH jumped 13% on Friday after posting strong fourth quarter results indicating sales which is a key boost for the luxury market in a time of slowing consumer spend.
The European Central bank also met market expectations late last week by maintaining the ECB interest rate steady at 4% for a third straight time.
Across the Asia markets on Friday, stocks mostly declined as investors piled out of EV stocks in the region amid concerns of slowing demand, while investors also digested inflation data out of Tokyo. Hong Kong’s Hang Seng dropped 1.8% on Friday, China’s CSI ended the day down 0.27%, and Japan’s Nikkei fell 1.34%. Japan’s inflation reading for January came in softer compared to December’s reading at 1.6% growth YoY and below the 1.9% rise economists were expecting.
Locally on Friday, the ASX200 was closed for the Australia day public holiday.
What to watch today:
- Ahead of the first trading session for the week here in Australia, the SPI futures are expecting the ASX200 to open the first trading day of the week up 0.19%.
- On the commodities front this morning, oil is up 0.84% at US$78.01/barrel, gold is down 0.07% at US$2018.38/ounce and iron ore is up 1.10% at US$137.50/tonne.
- AU$1.00 dollar is buying US$0.66, 97.43 Japanese Yen, 51.74 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has maintained a sell rating on Fortescue (ASX:FMG) but has slightly increased the price on the big miner following the release of the company’s December quarter results including iron ore shipments coming in-line with Bell Potter expectations, however, water supply disruptions continued to impact high grade magnetite production at Iron Bridge and FY24 guidance has been lowered again.
- And Trading Central has identified a bearish signal on Boral (ASX:BLD) following the formation of a pattern over a period of 29-days which is roughly the same amount of time the share price may fall from the close of $5.26 to the range of $4.92 to $4.98 according to standard principles of technical analysis.
Wall St closed mixed overnight as technology stocks were boosted following a rally from Netflix. The Dow Jones ended the session down 0.26%, the S&P 500 finished 0.08% higher and the tech-heavy Nasdaq gained 0.36%.
Netflix shares jumped 10% after they reached an all time high of 260.8 million subscribers with revenue toppling analyst expectations.
Over in Europe, the STOXX 600 rallied 1.15% higher with all sectors but telecoms finishing in the green, following the release of euro zone PMI data showing improved economic activity. Germany’s DAX ended the trading session 1.58% higher, the French CAC gained 0.91% and over in the UK, the FTSE100 finished in the green by over half a percent.
Locally yesterday, markets closed just 0.06% higher with the materials and real estate sector up 1.31% and 0.93% respectively. This was offset by the information technology sector which lost 1.15%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.2% at the open this morning.
- On the commodity front this morning,
Oil is up 1.18% to US$75.23 a barrel, following a larger-than -expected decline in US crude stockpiles. - Gold is down 0.81% to US$2012 an ounce following the announcement of strong PMI data in the US.
- And iron ore is trading 0.75% higher at US$133.50 a tonne.
- On the commodity front this morning,
Trading Ideas:
- Bell Potter maintains a buy rating on Chrysos Corporation (ASX:C79) despite slightly decreasing its price target. The buy rating is maintained as Bell Potter believes that the PhotonAssay technology will command a significant foothold within the large gold assaying market with current lease agreements with some large gold miners providing good near-term deployment visibility.
- And Trading Central has identified a bullish signal in Monash IVF Group (ASX:MVF), indicating that the stock price may rise from the close of $1.40 to the range of $1.46-$1.48 on a pattern formed over 25 days, according to the standard principles of technical analysis.
The local market advanced 0.51% on Tuesday tracking Wall Street’s rally and led locally by the health care sector jumping 1.02%. Heavyweight healthcare stocks including CSL and Cochlear gained 1.4% and 1.7% respectively while sleep apnoea device maker ResMed lifted 1.9% on Tuesday.
As the recent story on the miner front has gone, Karoon Energy joined the lowered production guidance train yesterday as the company lowered its Brazil production guidance for 2024, blaming operational issues at its Bauna project in November for the downgrade. Investors sold out of Karoon shares yesterday sending the share price down 3.8%.
Judo Bank on the other hand soared 16.8% after the company posted a 24% jump in profit before tax for the first half, driven by continued above-system lending growth, and stronger net interest margins, which have peaked for the big four banks.
NAB Business Confidence data for December released on Tuesday also boosted market sentiment as business confidence rose to -1 point for the month, up from -8 points in November and well above economists’ expectations of -7 points in a sign business conditions are improving.
It was a mixed session on Wall St on Tuesday with the Dow Jones retreating from record territory to close the day down 0.25% following the release of some disappointing earnings results, while the Nasdaq and S&P500 ended the day up 0.43% and 0.3% respectively. Investors used Tuesday’s session to pause and take some profits after it was confirmed the S&P500 officially reached bull market territory and the Dow Jones hit a new record high on Monday. United Airlines rose more than 6% on Tuesday after reporting stronger-than-expected fourth-quarter results, however, the airline said it expects a first quarter loss due to the grounding of Boeing 737 Max 9 airplanes across the US.
General Electric shares slipped 1% on Tuesday following the issue of weaker-than-expected guidance, while Johnson & Johnson also dipped over 1% after the healthcare giant said the company’s pharma division sales will be lower in the second half of 2024.
In Europe overnight, markets retreated as euro zone flash consumer confidence data fell to -16.1 points for December from -15 points in January which was against economists’ expectations of an improvement to -14.3 points, in a sign consumer confidence in the European economy continues to slide. The STOXX600 fell 0.25% on Tuesday, while Germany’s DAX and the French CAC each lost 0.34%, and, in the UK, the FTSE100 ended the day mostly flat.
What to watch today:
- Ahead of the local midweek trading session here in Australia the SPI futures are anticipating the ASX to open 0.17% higher tracking gains on the Nasdaq and S&P500 overnight.
- On the commodities front this morning, oil is trading 0.74% lower at US$74.2/barrel, gold is up 0.15% at US$2024/ounce and iron ore is flat at US$132.50/tonne.
- AU$1.00 is buying US$0.66, 97.41 Japanese Yen, 51.96 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has maintained a buy rating on Coronado Global Resources (ASX:CRN) but has slightly decreased the 12-month price target on the leading pure-play metallurgical coal producer following the release of the company’s December quarterly sales that met Bell Potter expectations however, revenue fell significantly short of Bell Potter’s expected US$887m. CRN also reported full year CY23 saleable production was 15.8million tonnes at mining costs of US$107.60 which were 3% and 8% misses on guidance respectively.
- And Trading Central has identified a bearish signal on Pengana Private Equity Trust (ASX:PE1) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may fall from the close of $1.42 to the range of $1.30 to $1.32 according to standard principles of technical analysis.
Wall Street opened the new trading week in record territory across two of the three key indices as investors shook off the equity slump that started 2024 lower ahead of key Q4 GDP data out later this week.
The Dow Jones rose 0.36% to trade above 38,000 for the first time during the session, while the S&P500 added 0.22% to reach a new all-time high and the Nasdaq advanced 0.32% on Monday.
The strength in US equities signals a strong bull run that has been in effect since October 2022 and the duration of this rally will depend on whether the US central bank can successfully pull off a soft landing over a recession as inflation continues to cool in the world’s largest economy. Later this week, Q4 GDP data will further indicate how well the Federal Reserve’s rate policy has been at bringing inflation down while maintaining economic stability.
Department store giant Macy’s rallied over 3% on Monday after rejecting a $5.8bn takeover offer while cost-cutting measures through laying off 16% of the workforce sparked a rally for SolarEdge shares.
Over in Europe, markets closed higher in the region to start the new trading week on a positive note as investors await the release of eurozone consumer confidence and monetary policy meeting data out later this week. The STOXX600 rose 0.78% on Monday, Germany’s DAX added 0.77%, the French CAC climbed 0.56%, and, in the UK, the FTSE100 ended the session up 0.35%.
The ASX has started the new trading week on a very positive note with the key index closing 0.75% higher on Monday, taking strong lead from Wall Street’s rally on Friday and driven by a tech surge on the local index. The global tech rally that took over markets in 2023 has extended into the new year as earnings growth on the AI and semiconductor front drives investor appetite for the high growth sector. The tech sector also benefits from interest rate cuts as it makes funding growth outlook more affordable for the high growth sector.
Big miners across a few key commodities were hit hard yesterday for a range of reasons. Lithium market darling of the past few years, Liontown Resources tanked over 20% yesterday after the company announced it is reviewing its expansion plans and associated ramp-up of its
Rare earths producer Lynas Rare Earths also fell out of favour with investors yesterday after releasing a December quarter update indicating output more than halved during the three months due to a temporary shutdown at its Malaysian facilities to complete an upgrade.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Tuesday’s session mostly flat.
- On the commodities front this morning oil is trading 2.38% higher at US$75.02/barrel, gold is down 0.3% at US$2023/ounce, and iron ore is up 2.71% at US$132.50/tonne.
- AU$1.00 is buying US$0.66, 97.44 Japanese Yen, 51.89 British pence and NZ$1.08.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Lynas Rare Earths (ASX:LYC) from $8.50 to $7.60 however, maintain a buy rating on the leading producer of rare earths following, after the company released a first half trading update outlining production on the weaker side, a slide in revenue, and weaker outlook in amid China’s sluggish recovery.
- And Trading Central has identified a bullish signal on Washington H Soul Pattinson (ASX:SOL) following the formation of a pattern over a period of 124-days which is roughly the same amount of time the share price may rise from the close of $33.21 to the range of $37.30 to $38.20 according to standard principles of technical analysis.
Renewed confidence in equities boosted Wall Street to a positive close on Friday, with the key indices shaking off the negative market sentiment that started 2024 in a downturn. The S&P500 rallied 1.23% to a new record high while the Dow Jones added 1.05% and the Nasdaq ended the final trading session of the week up 1.7%. The rally that ended last week in the US overturned the negative start to 2024 taking all three indices into gains for the year so far. Fresh consumer confidence data out on Friday indicated consumers are becoming more confident in both a soft landing and controlled inflation in the world’s largest economy. As earnings season ramps up in the US, we are seeing companies across insurance, financials and other key sectors post better-than-expected earnings which further boosts investor confidence at a time where earnings were expected to begin easing amid slowing economic growth.
Over in Europe, markets closed mostly lower as the World Economic Forum in Switzerland came to an end. The STOXX600 fell 0.3% on Friday while Germany’s DAX closed mostly flat, the French CAC dropped 0.4% and, in the UK, the FTSE100 ended the day up just 0.04%. The key message out of the economic forum was that while inflation is making good progress in declining to the target 2%, markets pricing in cuts from March is likely premature. UK retail sales data for December also indicated slowing retail spend as consumer sales dropped 3.2% in December, the traditionally high spend holiday trading period, as higher interest rates continue hurting UK consumers.
Locally on Friday, the ASX200 rose 1.02% as investors piled into technology stocks with the sector advancing 3.01% while utilities stocks were the only sector to fall out of favour with investors on Friday. EML Payments led the gains on Friday as the payment services company announced it was shutting down its loss-making PFS card services Ireland business, while Lottery Corp and Jumbo Interactive experienced rallies on news of Australia’s Powerball Jack-potting to the second largest amount in history this week of $150m.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Monday up 0.35% following the strength on Wall Street that ended Friday’s session in gains for 2024.
- On the commodities front this morning oil is trading down 1% at US$73.20/barrel, gold is up 0.34% at US$2029.48/ounce, and iron ore is up 0.4% at US$129/tonne.
- AU$1.00 is buying US$0.66, 97.79 Japanese Yen, 52.14 British Pence, and NZ$1.08 .
Trading Ideas:
- Bell Potter has maintained a sell rating on Fortescue (ASX:FMG), however, has significantly increased the 12-month price target on the major miner following a review into Bell Potter’s iron ore price forecasts. Near-term pricing upgrades are driven by unexpected resilience in the face of tight margins for Chinese steel producers, high levels of steel inventories and weak Chinese property sector outlook. Longer term though, Bell Potter has allowed for increased price support from growing demand from Indian steel production, Chinese government stimulus and recovering demand in the US and Europe.
- And Trading Central has identified bearish signal on Monadelphous Group (ASX:MND) following the formation of a pattern over a period of 51-days which is roughly the same amount of time the share price may fall from the close of $14.26 to the range of $12.90 to $13.20 according to standard principles of technical analysis.
This week’s market saw the fluctuation of commodity prices, the release of anticipated economic data, and a notable surge in uranium reaching unprecedented highs. The ASX200 declined 2% (Mon – Thurs), with all 11 industry sectors in the red. Materials and real estate posted the largest losses, while Boss Energy (ASX:BOE) was the best performing stock.
In this week’s wrap, Sophia covers:
- (0:20): why the energy sector retreated this week
- (1:46): the fall in natural gas and iron ore prices
- (2:29): what’s behind the uranium rally
- (3:04): the latest unemployment rate data
- (3:51): the best performing stocks on the ASX200
- (4:30): the most traded stocks & ETFs by Bell Direct clients
- (5:04): economic data to watch next week.
Wall St closed higher overnight as a surge in the tech stocks, powered major averages into positive territory. The Dow Jones finished off the trading day strong gaining 0.54%, the S&P 500 finished 0.88% in the green and the tech-heavy Nasdaq rallied 1.35%.
In terms of US shares, Apple added 3.4% following Bank of America upgrading the stock to a buy with a ‘20% upside over the next 12 months’. The Technology Select Sector SPDR Fund also reached an all time high, jumping 1.9%.
The 10-year treasury yield held around the 4.15% level on Thursday following fresh jobs data showing ongoing tightness in the US labour market.
Over in Europe, markets closed higher as investors further consume news and comments from the World Economic Forum in Switzerland. The STOXX600 closed 0.57% higher, rebounding following three previous, negative sessions with travel stocks gaining 5%. Germany’s DAX ended the trading day 0.83% in the green, the French CAC gained 1.13% and over in the UK the FTSE 100 rallied 0.17%.
Locally yesterday, the Australian market fell 0.63% with the real estate sector losing over 2% and the industrial and materials sectors losing over 1%. This was slightly offset by the consumer discretionary sector which gained 0.3% yesterday.
What to watch today:
- The Australian share market is set to open higher, with the SPI future suggesting a rise of 0.90% at the open this morning.
- On the commodity front this morning,
- Oil is up 2.22% to US$74.17 a barrel, following the continued geopolitical risk in the Middle East and output problems in the US helping drive up the price.
- Gold is up 0.81% to US$2021.73 an ounce and iron ore is down 1.53% to US$128.50 a tonne following the uncertain demand for construction materials in China.
Trading Ideas:
- Trading Central has identified a bullish signal on SG Fleet Group (ASX:SGF), indicating that the stock price may rise from the close of $2.30 to the range of $2.76-$2.86 on a pattern formed over 73 days, according to the standard principles of technical analysis.
- And Trading Central has identified a bearish signal on Diversified United Investment (ASX:DUI), indicating that the stock price may fall from the close of $4.92 to the range of $4.80-$4.82 on a pattern formed over 22 days, according to the standard principles of technical analysis.
Rising Treasury Yields and uncertainty around the Fed’s rate cut outlook dampened investor sentiment on Wednesday, extending the red run across the key indices for the week. The Dow Jones fell 0.2%, while the S&P500 and Nasdaq declined 0.5% and 0.6% respectively on Wednesday.
Treasury yields have been rising over the last few sessions following key Federal Reserve member speeches that warned the easing of monetary policy may come slower than investors first expected. This prompted investors to flee equities in favour of bonds as a safer return on investment in the current market environment.
Stronger than expected retail sales out of the US boosted some retail stocks on Wednesday indicating consumers are still spending despite the high interest rate and tough cost-of-living environment in the US. Retail sales in the world’s largest economy rose 0.6% in December, a rise from 0.3% in November and above consensus expectations of a flat reading month-on-month.
European markets closed the midweek session lower, extending on the global red run this week, as key inflation readings and World Economic Forum updates heightened investor concerns over the rate outlook in the region. The STOXX600 fell 1.1% as all sectors ended the day in the red led by mining stocks tumbling over 2.1%. Germany’s DAX closed 0.84% lower, the French CAC lost 1.07% and, in the UK, the FTSE100 fell 1.5% on Wednesday after inflation in the UK rose unexpectedly to 4% year-on-year in December’s reading.
Locally on Wednesday, the Aussie market extended its red run into the midweek session, partly weighed on by global markets overnight on Tuesday, weak economic data out of China also weighed on the local market, and energy and materials stocks dragged the ASX lower on Wednesday. The energy sector sell-off was driven by the sliding price of oil yesterday amid escalating tensions in the Red Sea, however, we have seen a recovery in the price of oil this morning as a strong USD counteracts the Red Sea threat on the commodity.
What to watch today:
- Ahead of Thursday’s trading session here in Australia the SPI futures are expecting the ASX to open 0.27% lower, extended on the negative global run this week. The pullback in global equities this year so far wasn’t unexpected as we saw markets both at home and overseas hover near all-time highs to end 2023. The pullback is primarily due to central banks around the world pushing back rate cut timeframes which is prompting investors to reposition in safer returns and diversified exposure through bonds and equities that perform better in the higher interest rate environment.
- On the commodities front this morning, oil is trading 0.6% higher at US$72.84/barrel, gold is down 1.06% at US$2006.10/ounce and iron ore is down 0.38% at US$130.50/tonne.
- AU$1.00 is buying US$0.65, 97.02 Japanese Yen, 52.14 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has maintained a buy rating on Integrated Research (ASX:IRI) and have slightly upgraded the price target on the leading global provider of experience management solutions from $0.60 to $0.66 following the company releasing a first half trading update including the company’s statutory revenue and EBITDA expectations coming in above Bell Potter expectations and the maintenance of no debt and a strong cash balance by the company throughout the first half.
- And Trading Central has identified a bullish signal on Eagers Automotive (ASX:APE) following the formation of a pattern over a period of 88-days which is roughly the same amount time the share price may rise from the close of $14.37 to the range of $16.60 to $17.10 according to standard principles of technical analysis.
Wall Street closed the first trading session of the holiday shortened trading week lower as investors assessed the latest batch of fourth quarter earnings results alongside rising bond yields. The Dow Jones fell 0.62% lower while the Nasdaq dipped 0.2% and the S&P500 ended the day down 0.37%. The benchmark 10-year Treasury note jumped nearly 12-basis points to 4.068% following Federal Reserve Governor Christopher Waller indicating the central bank may ease monetary policy slower than Wall Street had first anticipated, which prompted investors to sell equities in favour of government bonds.
In Europe, markets closed lower again as investors digested comments made at the World Economic Forum in Switzerland. The STOXX600 fell 0.3%, Germany’s DAX lost 0.3%, the French CAC fell 0.2% and, in the UK, the FTSE100 declined 0.5%.
We also have the European Central Bank indicating rate cuts may come later than first expected which is hurting GDP and economic growth in the region especially for the likes of Germany which are on the edge of technical recessions.
The local market has started the week in the red, with the ASX200 ending Tuesday’s session down 1.09% as utilities and energy stocks weighed on the market, and every sector closed the day in negative territory.
The supermarket giants weighed on the market yesterday, with Coles falling 2% and Woolworths sliding 1.5% after Australia’s competition watchdog said it would not hesitate to take legal action against a big supermarket chain for breaching consumer law, which comes just a week after Labor announced a review of industry codes, telling supermarkets to pass on lower wholesale costs to consumers and not ‘price gauge’ at the checkouts.
Australia’s consumer confidence data slipped in January as Aussies remain concerned about financial pressures following 13 interest rate hikes out of the RBA since May 2022.
What to watch today:
- Ahead of the midweek local trading session here in Australia the SPI futures are expecting the ASX to open Wednesday’s session up 0.05% despite the negative session across global markets overnight.
- On the commodities front this morning, oil is trading 0.81% lower at US$72/barrel, gold is down 1.34% at US$2027/ounce and iron ore is down 1.5% at US$131/tonne.
- The Aussie dollar continues to weaken against the greenback with AU$1.00 buying US$0.66, 96.94 Japanese Yen, 52.21 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has maintained a buy rating on Coventry Group (ASX:CYG) and increased the 12-month price target on the industrial supply and services group from $1.45 to $1.80 following the release of a first half trading update which overall was ahead of Bell Potter forecasts, including the anticipation of first half sales growth of 5.4% YoY and pre-leases standard EBITDA to lift 18.1% after the company implemented a range of buy and sell-side margin initiatives through the Trade network early in FY24.
- And Trading Central has identified a bearish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may fall from the close of $0.95 to the range of $0.84-$0.86 according to standard principles of technical analysis.
Over in Europe, markets started the week lower as investors in the European region prepare for the World Economic Forum in Switzerland. The STOXX600 fell 0.5% on Monday, while Germany’s DAX closed down 0.49%, the French CAC lost 0.72% and, in the UK, the FTSE100 ended the day 0.4% lower. Germany’s DAX closed in the red after fresh GDP data indicated the economy contracted 0.3% in 2023 amid rising interest rates, weaker domestic and foreign demand and high inflation in the region. Despite the 0.3% contraction in the region, Germany’s GDP was still 0.7% higher in 2023 than pre-pandemic in 2019.
Locally on Monday, the ASX was little unchanged with the key index closing the day down just 0.03% as a 2.11% surge in energy stocks was offset by losses among materials, healthcare and utilities companies.
Uranium stocks have enjoyed an extended rally into the first trading weeks of 2024 as global sentiment around nuclear energy continues to rise. Locally, Boss Energy and Palandin Energy rose over 9% and over 7% respectively on Monday.
On legal battles front yesterday, Santos and Qantas had very different outcomes that led to mixed reactions from investors. Santos shares rallied almost 4% after the mining giant received the green light to push ahead with laying the pipe at its $5.8bn Timor Sea gas project, after the Federal Court judge rejected cultural and environmental evidence from a group seeking to halt the project.
Qantas shares on the other hand fell 4.44% on Monday on news that the airline is engaged in another legal case with its workforce over alleged underpayment of its aircraft engineers.
What to watch today:
- Ahead of Tuesday’s trading session on the ASX, the local market is set to open the day 0.3% lower, taking no lead from Wall Street overnight as the U.S. was closed for the Martin Luther King Junior holiday.
- On the economic calendar today, we can expect Westpac’s consumer confidence data for January out this morning with the expectation of a slight rise by 0.5% for the first month of the year, that’s down from a 2.7% rise that ended 2023 on a high for consumers.
- Looking at the commodities, oil is trading 0.1% lower at US$72.61/barrel, uranium is up 1.65% at US$92.50/pound, gold is up 0.26% at US$2054/ounce and iron ore is down 2.92% at US$133/tonne amid ongoing weak economic growth fears out of China.
- AU$1.00 is buying US$0.67, 97.07 Japanese Yen, 52.31 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Santana Minerals (ASX:SMI) from $1.40 to $1.85 and maintain a speculative buy rating on the gold explorer and developer after the company released an update outlining it is awaiting one last batch of infill drilling results before commencing an updated Rise-and-Shine Mineral Resource Estimate. Bell Potter’s re-rating follows an update on the outlook for gold price forecasts, a modification to Bell’s Notional Development Scenario to confine the initial project development to an open pit mine development on the Rise-and-Shine deposit and an increase in exploration valuation to account for unutilised Mineral Resources.
- And Bell Potter has maintained a buy rating on GrainCorp (ASX:GNC) but has slightly decreased the 12-month price target on the end-to-end grain logistics company following a review of key drivers at the end of harvest season including improved soil moisture and tighter domestic wheat premiums. The reason for the slight decline in price target is due to NPAT expectation being reduced by around 4% in FY24 on lower assumed crush margins.
The Australian share market closed the week 0.12% higher, with technology and consumer discretionary leading the market, while utilities and materials declined the most.
The US saw little change on Friday, with the three major benchmarks closing slightly mixed. The Dow Jones was down 0.3%, while the S&P 500 and the Nasdaq only gained 0.08% and 0.02% respectively.
This followed disappointing earnings results which offset news of cooler-than-expected producer prices. The big focus was US bank earnings: Bank of American and JP Morgan shares declined, while Citigroup gained, after posting a $1.8 billion quarterly loss and announcing that they’re cutting 10% of its workforce.
And US markets will be closed Monday for the Martin Luther King public holiday.
What to watch today:
- The Australian share market is set to open higher this morning, with the SPI futures suggesting a 0.07% rise at the open.
- And economic data that the market will be looking out for this week includes Westpac’s consumer confidence data out tomorrow and December’s unemployment rate out on Thursday.
- Looking at commodities,
- Crude oil is trading almost 1% higher at US$72.86 per barrel, as concerns following potential supply disruptions escalated, following US and British air and sea strikes in Yemen.
- Gold has jumped over 1% to $2,050 an ounce, multiplying its morning gains on Friday, following the cooler-than-expected producer inflation print in the US that fuelled bets on earlier monetary easing by the Federal Reserve.
- Iron ore has fallen 3.2% to $136 per tonne, extending the decline from the 20-month high of $145, hit on January 4th, as decreasing margins for Chinese steel mills raised expectations of lower input buying.
Trading Ideas:
- Trading Central has identified a bearish signal on Transurban Group (ASX:TCL), indicating that the stock price may fall from the close of $13.67 to the range of $13.05 to $13.20 over 7 days, according to the standard principles of technical analysis.
The ASX200 advanced 2.54% this week (Mon - Thurs), buoyed by the Nasdaq and S&P500 hitting a 52-week high. The Dow Jones hit an all-time high, breaking through the 37,000 points barrier. The rally came after economic data showed inflation easing in the US and the Federal Reserve signalled rate cuts on the horizon in 2024.
The ASX took strong lead from Wall Street with rate-sensitive sectors leading the gains including the REIT sector rising 5.82%, while tech stocks jumped 4.9%.
In this week’s wrap, Grady covers:
- (0:26) key opportunities for investors to reposition their portfolios in 2024
- (0:37) what to consider in the healthcare sector
- (1:32) the outlook for gold heading into the new year
- (2:52) how retailers surprised the market in 2023
- (4:31) the best & worst performing stocks on the ASX200
- (5:11) the most traded stocks by Bell Direct clients this week
- (5:41) economic data to watch out for next week.
Read the transcript here.
Wall Street’s rally experienced a significant boost on Wednesday with the Dow Jones soaring 1.4% to top 37,000 points for the first time ever after the Federal Reserve not only maintained the US cash rate, but also signalled it would cut rates three times next year amid inflation easing in the world’s largest economy. The S&P500 jumped 1.37% and the tech-heavy Nasdaq rallied 1.38% on Wednesday, leading to the three major indices hitting fresh 52-week highs. The Federal Reserve also lowered its inflation forecast for 2024, with the expectation of inflation to ease to 2.4%, down from the previously expected 2.6.
Over in Europe, markets closed flat on Wednesday as investors in the region awaited the release of the Fed’s latest interest rate decision and any commentary on rate outlook from the world’s largest economy in the last month of 2023. The STOXX600 closed just 0.01% lower as gains for chemicals stocks were offset by a decline among telecoms stocks. Germany’s DAX fell 0.15% on Wednesday, the French CAC shed 0.16%, and, in the UK, the FTSE100 closed the day up 0.08%. UK GDP data out overnight indicated the English economy contracted by 0.3% in October, with the country’s services, production and construction services all shrinking according to new data out of the National Statistics on Wednesday. This follows growth of 0.2% in September.
Locally yesterday, the ASX200 rose 0.31% driven by healthcare stocks lifting 1.11% buoyed by Sigma Healthcare soaring 40% after returning from a trading halt post Chemist Warehouse merger announcement. Neuren Pharmaceuticals was the best performing stock on the ASX200 on Wednesday while Chalice Mining and IDP Education weighed on the key index.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open Thursday’s trading session up 1.09% on the back of the Wall St rally overnight.
- On the commodities front this morning, oil has rebounded to trade 1.9% higher at US$69.91/barrel, gold is up 2.3% at US$2024/ounce, iron ore is trading 0.73% higher at US$138.50/tonne, and coal is trading 4.26% lower at US$146/tonne.
- The landmark COP28 summit in Dubai has seen nations agree to ‘transition away’ from coal, oil and gas as opposed to a complete ‘phase out of fossil fuels’ as some of the larger nations had pushed for a complete phase-out while others argued against it. The focus for the last two weeks of the summit has been on making progress on tackling climate change after months of record-breaking extreme weather.
- AU$1.00 is buying US$0.67, 95.39 Japanese Yen, 52.32 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has maintained a hold rating on Clean Seas Seafood (ASX:CSS) and has significantly reduced the price target on the integrated Kingfish producer after the company announced a material strategy pivot and associated recapitalisation of the balance sheet. The new strategy includes an approximate 800 tonne reduction in biomass, a consolidation of farming sites and a targeted reduction in fixed and variable costs.
- And Trading Central has identified a bearish signal on Chorus (ASX:CNU) following the formation of a pattern over a period of 30-days which is roughly the same amount of time the share price may fall from the close of $7.13 to the range of $6.15 to $6.35 according to standard principles of technical analysis.
Wall Street’s rally extended into Tuesday’s session with the key indices rising sharply in afternoon trade as the S&P500 added 0.46%, the Dow Jones rose 0.48%, and the tech-heavy Nasdaq had the biggest rise of 0.7%. The latest Consumer Price Index data is driving the rally today with the reading showing inflation in the US rose 3.1% in November YoY and 0.1% MoM which was in-line with economists’ expectations and continuing the deflationary trend, which provides support for the Fed to look toward interest rate cuts in the near future as the inflation rate is falling toward the target 2% inflation rate.
The all-important Fed policy meeting also kicks off today ahead of the interest rate decision out tomorrow with the expectation that the Fed will maintain the current cash rate following the release of recent favourable economic data.
Over in Europe, it was a lacklustre session across markets with majority closing slightly lower on Tuesday as investors responded to the latest CPI reading out of the US and other economic data released in the European region. The STOXX600 fell 0.23%, weighed down by the oil and gas sector sliding 1.28%, while Germany’s DAX closed just 0.02% lower, the French CAC fell 0.11% and, in the UK, the FTSE100 ended the day down just 0.03%.
UK unemployment came in at 4.2%, a flat reading on September and below economists’ expectations in a sign the labour market in the UK remains tight.
The ASX extended its December rally into Tuesday’s session with the ASX ending the day up 0.5%, as every sector closed in the green, led by the technology sector after the Nasdaq had a strong day on Wall Steet on Monday. Materials stocks closed flat as the iron ore price dipped on Tuesday.
Australia’s business and consumer confidence data released yesterday came in at mixed readings with business confidence falling -9 points, well below the expected -1 point while consumer confidence rose 2.7% from a decline of 2.6% in November, in a sign consumers are optimistic over the recovering economic conditions.
The story of the week so far has been the response to Sigma Healthcare accepting a transformative merger with Chemist Warehouse to bring the retail pharmacy to the ASX. Fund managers are bullish on the potential backdoor listing for Chemist Warehouse as the $8.8bn deal is awaiting approval from the competition regulator.
What to watch today:
- On the commodities front this morning, oil has taken a dive overnight, with the spot price now down 3.84% to US$68.59/barrel amid concerns of oversupply despite OPEC+ announcing further output cuts to stabilise the price of the commodity. Gold is trading 0.2% lower at US$1977/ounce and iron ore is flat at US$137.50/tonne.
- AU$1.00 is buying US$0.66, 95.41 Japanese Yen, 52 British Pence and NZ$1.07.
- Ahead of the local trading session here in Australia the SPI futures are expecting the local market to open the midweek session flat despite Wall Street’s rally overnight.
Trading Ideas:
- Bell Potter has initiated coverage of Pilbara Minerals (ASX:PLS) with a hold rating and a price target of $3.90. The hold rating follows recent lithium market weakness seeing heavy shorting in the PLS stock, however Bell Potter’s analyst sees this as short-sighted momentum and is confident that Pilbara’s low-cost producing and strong balance sheet sets it up to withstand weaker lithium prices and supports expansion programs. The analyst is also confident that EV-led demand will see strong medium to long-term lithium market fundamentals.
- And Trading Central has identified a bullish signal on GUD Holdings (ASX:GUD) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may rise from the close of $11.66 to the range of $12.60-$12.90 according to standard principles of technical analysis.
Wall St traded mostly flat on Monday before rallying in afternoon trade to close higher across the key indices as investors remain optimistic in the final trading weeks of 2023. Investors are looking ahead this week to the all-important Fed policy meeting and inflation data in the region which could see markets respond accordingly later in the week. The S&P500 closed 0.4% higher, the Nasdaq added 0.2% and the Dow Jones advanced 0.43%. Macy’s shares rallied over 20% on Monday after the retailer received a takeover offer worth US$5.8bn while tech stocks pulled back to close the session lower.
Over in Europe, markets in the region closed mostly higher on Monday as investors look ahead to the upcoming US FOMC meeting this week to determine the rate outlook for the world’s largest economy heading into 2024. Miners in the region weighed on the market while the European Blue-Chip index or the STOXX600 rose 0.4%. Germany’s DAX rose 0.21% on Monday, and the French CAC added 0.33%, but in the UK, the FTSE100 fell 0.13% at the session’s end.
Locally yesterday, the ASX200 rose just 0.06% as strong gains among energy stocks offset losses for materials, utilities and technology stocks. The gold miners took a hit yesterday amid the price of the precious commodity dipping below US$2000 during the trading session, with analysts blaming the strong jobs data out of the US last week as the catalyst for the decline in the price of gold. Iron ore miners on the other hand enjoyed a rally on Monday as the price of the commodity rose, attributed to China’s restocking demand for steel mills in the region.
Sigma Healthcare (ASX:SIG) was the story of the day yesterday after the company agreed to a ‘transformational merger’ with Chemist Warehouse to bring the leading retail pharmacy brand to the ASX through the creation of an $8.8bn retail giant. Shares in Sigma Healthcare remain in a trading halt but last traded at 76.25cps. Concerns over Star Entertainment Group (ASX:SGR) ’s ability to operate its Sydney-based casino sparked a further sell-off in the stock yesterday with shares closing the day down 8.7%, while Costa Group lost almost 4% yesterday after announcing earnings in CY23 would come in below that of 2022.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open Tuesday’s session up 0.18% taking lead from Wall Street’s rally overnight.
- On the economic calendar today, Australia’s consumer and business confidence data will be released for December and November respectively with the expectation of a slight lift in both amid improving outlook for business conditions.
- On the commodities front this morning, oil is trading just 0.08% higher at US$71.29/barrel, gold is down 1.09% at US$1981.46/ounce and iron ore is up 1.1% at US$137.50/tonne.
- 1 Aussie dollar is buying US$.066, 96 Japanese Yen, 52.29 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has maintained a sell rating on Platinum Asset Management (ASX:PTM) and a price target of 84cps following the company’s announcement of appointing Jeff Peters as its new CEO. The appointment of Mr Peters may signal a new dawn for the company, however, there remains challenges with declining funds under management and revenues, in addition to an increasing cost base.
- And Bell Potter has increased the 12-month price target on Alligator Energy (ASX:AGE) from 8cps to 10cps and maintain a speculative buy rating on the uranium miner following the release of an updated Mineral Resource Estimate for the Blackbush Deposit including an increase of 21%.
Wall Street ended Friday’s session in positive territory across the key indices with the S&P500 closing at the highest level for the year, after favourable economic data enhanced signals of a soft landing in the U.S. over a recession. The S&P500 rose 0.41%, the tech-heavy Nasdaq added 0.45%, and the Dow Jones lifted 0.36% on Friday, and for the week the key indices each posted gains under 1% to end a 6th straight winning streak higher.
November jobs data out late last week indicated the US economy added 199,000 jobs for the month which beat economists’ expectations, while the November unemployment rate dipped to 3.7% from 3.9% in October; which also topped expectations of a hold at 3.9%. This data indicates the US economy remains resilient and robust against inflation easing in the higher interest rate environment. Consumer sentiment and inflation expectations also showed positive signs in that sentiment hit the highest level since July in the latest reading while inflation expectations continue to ease.
Over in Europe, markets also closed higher on Friday as investors in the region responded to favourable jobs data out of the U.S. and welcomed the resilience in jobs as a sign that the world’s largest economy could avoid recession. The STOXX600 rose 0.7% as travel and leisure stocks rose 1.5%, while Germany’s DAX added 0.78%, the French CAC rose 1.32% and, in the UK, the FTSE100 lifted just over half a percent.
Locally on Friday, the ASX200 rose 0.3% boosted by the energy sector recovering from recent lows to close the day 1.04% higher, while technology and utilities stocks were the only two sectors to end Friday’s session in the red.
The story of the session on Friday drove Santos to a 6.2% rise after the energy giant hit headlines for a proposed merger with fellow energy giant Woodside to create a $52bn energy powerhouse.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the local market to open Monday’s trading session 0.22% higher to start the new trading week in the green and extend the Santa rally we have seen this month so far.
- On the commodities front this morning, oil has recovered to trade 2.73% higher at US$71.23/barrel, gold is down 1.18% at US$2004/ounce and iron ore is up 1.87% at US$136/tonne.
- AU$1.00 is buying US$0.66, 95.35 Japanese Yen, 52.43 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Chalice Mining (ASX:CHN) and a 12-month price target of $5.40 following the release of recent results from the ongoing drill programs at its 100%-owned Gonneville Nickel Copper PGE project in WA, with the results showing extensions of high-grade zones to the north-west of the deposit. Chalice also announced that all key approvals have been received to allow commencement of the next phase of exploration drilling across the full >30km strike length of the interpreted Julimar Complex.
- And Trading Central has identified a bullish signal on Sonic Healthcare (ASX:SHL) following the formation of a pattern over a period 53-days which is roughly the same amount of time the share price may rise from the close of $31.10 to the range of $32.70 to $33.10 according to standard principles of technical analysis.
The ASX200 advanced 1.42% this week (Mon - Thurs), with real estate and information technology in the lead. The rally came after the RBA announced it's holding the cash rate at 4.35%. Most industry sectors posted strong gains, apart from energy and utilities.
As the festive season and new year approach, let's consider Bell Potter's latest outlook and stock picks, across three industry sectors - fast moving consumer goods or FMCG, technology and real estate.
In this week’s wrap, Sophia covers:
- (0:30) buying opportunities in the FMCG industry
- (1:36) Bell Potter's recommendations in the tech sector for 2024
- (2:44) real estate stocks to consider
- (4:52) the best & worst performing stocks on the ASX200
- (5:48) the most traded stocks by Bell Direct clients this week
- (6:28) economic data to watch out for next week.
Wall St closed in the green overnight as investors await jobs data results, set to be released on Friday. The S&P 500 rose for the first time in four days, up 0.80%, the Dow Jones, finished the day 0.17% higher and the tech-heavy Nasdaq rose 1.37%.
Over in Europe, markets closed lower as the STOXX600 fell 0.3% with the majority of the sectors ending Thursday’s session in the red with retail stocks leading losses, down 1.1%. Germany’s DAX lost 0.26%, the French CAC lost 0.1% and over in the UK, the FTSE100 closed slightly lower by 0.02%. Airline group Air France-KLM closed 3.1% lower, with JPMorgan analysts cutting the stock to underweight from overweight.
Locally yesterday, the ASX200 closed 0.07% lower with losses lead by the consumer discretionary and health sectors which lost 0.53% and 0.46% respectively. This was slightly offset by the utilities sector which gained 0.84% by market close yesterday.
What to watch today:
- The Australian share market it set to open lower, with the SPI futures suggesting a fall of 0.13% at market open this morning.
- In terms economic data today, US unemployment rate data will be released tonight at 11:30pm with the consensus and forecast holding at 3.9%, the same as its previous result.
- On the commodities front this morning,
- Oil is trading 0.60% higher at 69 US dollars and 80 cents a barrel, gold is up 0.21% to 2029 US dollars an ounce and iron ore is trading 1.14% higher at 133 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Perpetual Ltd (ASX:PPT) and has an unchanged 12-month price target of $27.09. Bell Potter have been highlighting the undervaluation of Perpetual for a while and only recently, Washington H. Soul Pattinson have made a non-binding indicative proposal to acquiree PPT in scrip. This would acquire 100% of Perpetual, with Perpetual Asset Management being demerged and returned to PPT shareholders. Bell Potter would be surprised if further bids for Perpetual did not appear.
- And Trading Central has identified a bullish signal on Australian Clinical Labs (ASX:ACL), indicating that the stock price may rise from the close of $2.77 to the range of $3.00-$3.06, on a pattern formed over 27 days, according to the standard principles of technical analysis.
US markets declined as investors assess data indicating falling inflation, while awaiting the latest employment report. The Dow Jones fell for the third consecutive session, down 74 points or 0.2%, while the S&P500 and the Nasdaq fell 0.4% and 0.5% respectively.
European markets closed higher, rebounding from mixed trade earlier in the week. Germany’s DAX extended gains to a record high. The STOXX 600 rose 0.6% by the close, with mining stocks turnaround sharply.
What to watch today:
- The Australian share market is set to open lower this morning, with the SPI futures suggesting a drop of 0.39% at the open.
- In commodities,
- The price of oil has fallen, currently trading more than 4% lower at US$69 per barrel at the time of recording. It’s the lowest level since early July, due to demand worries and increased supply. The US Energy Information Administration reported that gasoline inventories in the US were up by 5.4 million barrels in the week ending December 1st, which is the largest increase in nine weeks and well above forecast of 1 million. This implies weaker demand and has seen the price of crude oil sharply drop, so keep watch of energy producers today such as Santos (ASX:STO) or Beach Energy (ASX:BPT). In addition, concerns on the economic outlook of China also appear to be weighing heavily on crude prices.
- Meanwhile, gold and iron ore prices are in the green.
- In economic data today, Balance of Trade data for October will be out today. Australia’s trade surplus on goods declined to a 30-month low in September, as exports fell while imports surged. October’s data will be out at 11:30am this morning AEDT.
Trading Ideas:
- Bell Potter maintains a Buy rating on Aeris Resources (ASX:AIS), a multi-mine copper-gold production and exploration company. The company has undertaken a fully underwritten $30 million equity raising, via a $13.9 million institutional placement, and a $16.1 million pro-rata, accelerated non-renounceable entitlement offer, which will result in the issue of 273 million new shares at an offer price of $0.11. Washington Soul Pattinson is a major shareholder who are supportive of the raise. Bell Potter have lowered their price target from $0.30 to $0.23, and at the current share price of $0.11, this implies 109% share price growth in a year.
- And Bell Potter have lowered their rating on Neuren Pharmaceuticals (ASX:NEU) from a Buy to a Hold, with no changes to their forecast or price target. Neuren is a drug development company and Bell Potter say that the clear upcoming catalyst is the Phase 2 trial for PMS. Their price target remains unchanged at $17.50 and at the current share price of $16.05, this implies 9% share price growth in a year.
Wall St closed mixed overnight as favourable economic data coming out of the US, shows further signs of inflation cooling, with job openings data declining 6.6% in October, indicating that the US labour market is cooling. The Dow Jones and the S&P 500 both lost 0.2% and 0.06% respectively, meanwhile the tech-heavy Nasdaq gained 0.31% overnight.
In Europe overnight, markets were mixed in the region as investors digested some key economic data and took a breather to assess valuations given the recent stock market rallies both in the European region and on global markets. UK households appear to have delayed Christmas spending this year as retail sales data in the region showed very muted growth of 2.7% in November which is much lower than the 4.2% growth recorded in November 2022, in a sign higher cost of living pressures are beginning to bite in the UK. The STOXX600 rose 0.4% on Tuesday, Germany’s DAX rose 0.78%, the French CAC added 0.74% and, in the UK, the FTSE100 fell 0.31%.
Locally yesterday, the ASX200 closed 0.89% lower with the energy and material sectors losing 2.05% and 1.81% each respectively. This was slightly offset by the utilities sector which saw a rise of 0.55% by market close yesterday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.42% at market open this morning
- In terms of economic data, yesterday the RBA announced the nations cash rate will be maintained at 4.35% in its last meeting for 2023.
- On the commodities front this morning, oil is down just 0.07% at 72 US dollars and 92 cents a barrel, gold is down 0.57% at 2018 US dollars an ounce and iron ore is down 1.13% at 131 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Cyclopharm and has kept its 12-month price target steady at $4.25. The buy rating is maintained as Cyclopharm’s initial roll out of Technegas in the US is proceeding with Duke University signing a contract to use their product. Duke University is a tier 1 academic hospital, attached to the University’s medical school and further announcements regarding subsequent contract signings for the use of Technegas are expected in the short term.
- And Trading Central has identified a bullish signal in Sonic Healthcare, indicating that the stock price may rise from the close of $29.37 to the range of $31.20-$31.70, over a period of 44 days, according to the standard principles of technical analysis.
Wall Street opened the new trading week lower, retreating from the rally experienced on the NYSE over the last five weeks. The Dow Jones fell 0.11%, the S&P500 dropped 0.54%, and the Nasdaq took the biggest hit, falling 0.84%. The sectors that have carried Wall Street over the last 11 months took the biggest hit on Monday as investors digest the high valuations of big-name companies especially in the technology sector.
Alaska Air fell 14.2% on Monday after it agreed to acquire rival airline, Hawaiian Airlines for US$1.9bn in a bid to expand Alaska Air’s presence to the West Coast of the US.
Spotify shares rose 8.8% on Monday after the music streaming giant announced it would lay off 17% of its workforce, which equates to around 1500 jobs in a bit to cost cut in the high-cost environment.
Over in Europe, markets closed mostly lower on to start the week as the big miners weighed on markets in the region, while gold miners bucked the trend with a rally on the back of the precious commodity hitting a record high US$2100/ounce. Analysts are predicting the price of gold will remain resilient into 2024 on outlook of a weaker USD, geopolitical uncertainty and the prospect of interest rate cuts on the horizon. The STOXX600 fell 0.1% on Monday, Germany’s DAX rose 0.04%, the French CAC fell 0.2% and, in the UK, the FTSE100 lost 0.22%.
Locally yesterday, the ASX200 kicked off the new trading week on a very positive note with the key index ending the session up 0.73% buoyed by interest-rate sensitive sectors, with the tech sector rising 1.9%, while real estate added 1.55%. On the other end of the market, the utilities sector fell 2.52% while energy stocks lost 1.26% on the sliding price of oil.
Chalice mining recovered 11.47% on Monday despite no price sensitive news out of the copper-nickel miner yesterday. Star Entertainment Group gained 6.86% on Monday while the lithium miners came under pressure yesterday with Sayona Mining falling 9.68%, Core Lithium shedding 5.56% and Pilbara Minerals ending the day down 2.22%.
What to watch today:
- Ahead of the local session here in Australia the SPI futures are expecting the ASX to open Tuesday’s session down 0.53%, taking lead from Wall Street overnight.
- Taking a look at commodities this morning, oil continues to decline despite OPEC+ announcing production cuts of 2.2 million barrels per day in a bid to stabilise the price of oil, which is trading 1.07% lower at US$73.28/barrel. Gold is down 2% this morning at US$2029/ounce and iron ore is up 0.4% at US$133/tonne.
- On the economic calendar today the highly anticipated RBA interest rate decision is announced today with the expectation of the interest rate to be maintained at the current 4.35%.
- Stocks trading ex-dividend today include Fisher & Paykel Healthcare Corporation and Dalrymple Bay Infrastructure. If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend, generally trade lower on the ex-dividend date.
Trading Ideas:
- And Bell Potter has maintained a speculative buy rating on Deep Yellow (ASX:DYL) and a 12-month price target of $1.81 after the uranium miner added an additional approximately 1.5 years of production to the Tumas project, with the expanded indicated and inferred resources. Looking into CY24, some key catalysts include a Final Investment Decision on Tumas, refreshed capital and operating costs for Tumas, and Mulga Rock updated definitive feasibility study.
- And Bell Potter has slightly increased the price target on Genusplus Group (ASX:GNP) from $1.40 to $1.50 and maintain a buy rating on the mining services provider following the Genusplus and its JV partner ACCOINA being awarded a $1.4bn design and construction contract for the HumeLink East project by Transgrid.
Wall St rallied on Friday to close the week off strongly. The Dow Jones ended the trading week in the green up 0.82% with the S&P 500 and the tech-heavy Nasdaq both rising by 0.59% and 0.55% respectively.
Europe closed higher on Friday following a global rally in stocks and bonds. The STOXX600 ended the trading session up 1%, with mining stocks leading gains, up 4.2% after China’s manufacturing sector recording an unexpected expansion. Germany’s DAX rose 1.12%, the French CAC gained 0.48% and over in the UK, the FTSE100 ended the trading day just over 1% in the green.
Locally on Friday, the ASX200 closed 0.20% lower to end the trading week. Losses were led by the information technology and consumer staples sectors which lost 1.08% and 0.84% respectively. This was slightly offset by the energy sector which rose 0.12% on Friday.
What to watch today:
- The Australian market is set to open higher, with the SPI futures suggesting a rise of 0.92% at the open this morning.
- On the commodities front today,
- Oil is down 2.49% to US$74.07/barrel as Saudi Arabia is expected to extend its voluntary cut of 1 million barrels a day.
- Gold is up 1.78% to US$2071.96/ounce and iron ore is down 0.75% to US$132.50/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Develop Global (ASX:DVP) and has kept its 12-month price target steady at $4.30. The buy rating is maintained following the forthcoming restart of Woodlawn operations coinciding with growing revenue generation in the company’s underground mining services business. DVP was also awarded a $46 million underground development contract by the Mt Marion joint venture to establish and develop an exploration decline at the Mt Marion lithium mine in Western Australia.
- And Trading Central has identified a bearish signal in Omni Bridgeway (ASX:OBL), indicating that the stock price may fall from the close of $1.47 to the range of $0.92-$1.02 on a pattern formed over 24 days, according to the standard principles of technical analysis.
The final month of 2023 is here and it’s time to look back at how some of the key ASX sectors performed this year so far. Some sectors like staples and discretionary stocks have surprised the market for respective reasons, while healthcare has underperformed which opens some investment opportunities heading into 2024.
Key strategic moves from companies included capital structure restructuring and inventory reduction which helped boost the share prices of some retailers, while a slowing growth outlook is hurting some key tech names as we motor towards 2024.
In this week’s wrap, Grady covers:
- (0:44) Why the technology sector soared in 2023.
- (2:15) Headwinds facing some consumer staples stocks.
- (3:22) Discretionary stocks that surprised the market in 2023.
- (4:34) Financials pulling back late this year.
- (4:52) Energy and geopolitical tensions & output fluctuations.
- (6:51) The most traded stocks by Bell Direct clients this week.
- (7:22) RBA rate decision & US jobs data out next week.
Read the transcript here.
Wall Street closed mixed overnight with the Dow Jones rallying to a new high for the year, ending the session up 1.47%. The S&P 500 rose 0.38%, but the tech-heavy Nasdaq fell 0.23% overnight as investors took some profits in Big Tech stocks that led the November comeback rally. In terms of US stocks, Salesforce jumped 8.6% on the back of better-than-expected earnings and revenue in the fiscal third quarter.
Over in Europe, markets closed higher to end the best month since January. The STOXX600 closed 0.5% higher, Germany’s DAX ended the trading day up 0.30%, the French CAC closed 0.59% higher and over in the UK the FTSE 100 rose 0.41%.
Locally yesterday, the ASX200 closed Thursday 0.74% higher led by gains in the industrial and information technology sectors of 1.43% and 1.29% respectively. This was slightly offset by the utilities sector which ended Thursday’s session 0.95% in the red.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.27% at the open this morning on the back of Wall Street’s mixed session overnight.
- On the commodities front this morning,
- Oil is down 2.71% to US$75.73 a barrel with Brazil announcing a plan to increase its output to 3.8 million barrels a day, raising concerns of oversupply.
- Gold is down 0.45% to US$2,035 an ounce.
- Iron ore is down 0.74% to US$133.50 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on DroneShield (ASX:DRO) and has increased the 12-month price target on the defence technology company to $0.50. The buy rating is maintained by Bell Potter as DroneShield has significantly increased the scale of their operations, and revenue forecasts have increased by 21%, 27% and 25% in CY24, CY25 and CY26, leading to the analyst maintaining a buy rating on the company.
- And Trading Central has identified a bullish signal in Regis Resources (ASX:RRL), indicating that the stock price may rise from the close of $1.95 to the range of $2.16-$2.22 on a pattern formed over 77 days, according to the standard principles of technical analysis.
US equities closed near the flat line, with the Dow Jones just 0.04% higher, while the S&P 500 was 0.09% lower and the Nasdaq down 0.16% lower.
European major benchmarks closed higher, as regional markets regained momentum. The STOXX 600 closed 0.43% higher, with auto stocks up the most. Germany’s DAX maintained gains following German inflation figures being released during afternoon trading, slowing to 2.3% in November. The DAX is now at its highest level since the beginning of August. France’s CAC also closed in the green, while the FTSE 100 closed lower.
What to watch today:
- The Australian market is set to open slightly higher, with the SPI futures suggesting a 0.1% rise at the open this morning.
- In commodities,
- Crude oil has jumped 1.65%, nearing US$78 per barrel, ahead of the OPEC+ meeting today, where the group will set its production policy for 2024. OPEC+ are considering new oil production cuts of as much as 1 million barrels a day.
- Meanwhile, the price of gold has rallied, hitting its highest levels in nearly seven months, off the back of a sharp decline in the US dollar. So, keep watch of ASX- listed gold miners.
- And iron ore is lower, trading at US$133.50 per tonne.
- In economic data, private sector credit data and building permit data will be out today. We’ll also be awaiting eurozone inflation for October out tonight.
- And there’s a list of companies holding their AGMs today. These include Imugene (ASX:IMU), Lake Resources (ASX:LKE), Liontown Resources (ASX:LTR) and Sayona Mining (ASX:SYA).
- And stocks going ex-dividend today include Aristocrat Leisure (ASX:ALL) and Technology One (ASX:TNE).
Trading Ideas:
- Bell Potter maintains a Buy rating on EROAD (ASX:ERD) and have increased their price target by 6% to $0.95. At the stock’s current share price of $0.76, this implies 25% share price growth in a year.
- And Trading Central have identified a bullish signal on Magellan Financial Group (ASX:MFG), indicating that the stock price may rise from the close of $7.43 to the range of $8.40 to $8.60 over 38 days, according to the standard principles of technical analysis.
Wall Street resumed the November rally on Tuesday with stocks closing Tuesday’s session higher as comments from a Federal Reserve official boosted investor hopes that the central bank may not need to raise the interest rate any further. The Dow Jones rose 0.24%, the S&P500 added 0.1% and the tech-heavy Nasdaq rose 0.3%.
US GDP Growth Rate for Q3 is out tonight and will give an indication of just how the US economy is coping during the high interest rate environment, with consensus expecting annualised growth of 5%, following a rise of 4.9% in the last reading, which provides further indication of a soft landing in the US over a recession.
In Europe, markets closed mostly lower on Tuesday following the release of key economic data in the region. The STOXX600 ended Tuesday’s session in the red, while Germany’s DAX rose 0.16%, the French CAC fell 0.21% and, in the UK, the FTSE100 ended Tuesday’s session down 0.07%. Consumer sentiment data was released in Germany and France overnight indicating German consumers are slowly increasing their willingness to buy in recession-hit Germany however income expectations in the region have declined, while in France, the French consumer remains sluggish on outlook as indicated by consumer confidence data.
Locally on Tuesday, the gold miners and real estate stocks boosted the ASX to a positive finish on Tuesday, with the key index ending the day up 0.4%. The energy sector weighed on the market yesterday as oil retreated for a third straight day amid delays to the upcoming OPEC+ meeting where it is expected the group of oil producing leaders will initiate further output cuts to stabilise oil prices.
For the month so far, the ASX is tracking 2.8% higher buoyed by the real estate sector as investors begin to reconsider investments in the REIT space after a heavy sell-off in this rate sensitive sector throughout the first half of 2023.
The retailers took a hit on Tuesday after Australian retail sales data for October showed a decline of 0.2% which wasn’t unexpected as Aussies saved money prior to the Black Friday and Cyber Monday sales periods. Economists were expecting a slight pullback in sales to a rise of 0.1% for October, however the result coming in at a 0.2% decline indicates just how hard Aussies are doing it in the high cost of living environment. We are expecting a rise in November sales though as Aussies snapped up bargains during the promotional sales weekend.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open the midweek trading session up 0.28%.
- On the commodities front this morning, oil is trading 2.57% higher at US$76.78/barrel, gold is up 1.36% at US$2041/ounce and iron ore is down 0.74% at US$134.50/tonne.
- AU$1.00 is buying US$0.66, 98.16 Japanese Yen, 52.34 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the rating on IDP Education (ASX:IEL) from a hold to a buy and increased the price target from $26.70 to $27 following the release of recent student visa data from key source markets including India, China, Vietnam, Australia, Nigeria and Thailand into key destination countries of Australia, the UK and Canada. While 1H24 is typically seasonally weaker in Australia, levels came in slightly above pre-pandemic levels and the Northern Hemisphere data was encouraging particularly for Canada which is a key market IDP operates in.
- And Trading Central has identified a bullish signal on Northern Star Resources (ASX:NST) following the formation of a pattern over a period of 40-days which is roughly the same amount of time the share price may rise from the close of $12.14 to the range of $14.20 to $14.70 according to standard principles of technical analysis.
Wall St closed lower to open the new trading week in the red. The Dow Jones ended Monday’s session down 0.16%, the S&P 500 closed 0.2% lower and the tech-heavy Nasdaq fell 0.07%.
In terms of US stocks, e-commerce shares jumped on Cyber Monday with Amazon and Shopify jumping 1.1% and 4.5% respectively.
Over in Europe, markets closed lower overnight with the STOXX600 closing down 0.3% as oil and gas stocks traded flat, while travel stocks fell 0.8%. Germany’s DAX fell 0.39% while the French CAC and the UK’s FTSE100 both ended the day 0.37% in the red.
Locally yesterday, the ASX200 closed 0.75% lower with all but the information technology sector finishing in the session in negative territory. Losses were led by the consumers discretionary and real estate sectors which lost 1.26% and 1.34% respectively.
What to watch locally today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.16% at market open this morning.
- On the commodities front this morning,
- Oil is trading down 0.87% to 74 US dollars and 88 cents a barrel with focus on the upcoming OPEC+ meeting where Saudi Arabia and Russia are expected to prolong voluntary supply cuts until at least the first quarter of 2024.
- Gold is up just over half a percent to 2013 US dollars and 29 cents an ounce and iron ore is down 0.37% to 135 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Smartpay Holdings (ASX:SMP) despite lowering its price target to $1.75. The price target was reduced as the underlying EBITDA in the first half of 2024 fell modestly below the forecast. However, the buy rating is still maintained as the positive view on SMP is underpinned by system growth in digital payments and early expansion in the Australian market.
- And Trading Central has identified a bullish signal on Ramelius Resources (ASX:RMS), indicating that the stock price may rise from the close of $1.58 to the range of $1.74-$1.78 on a pattern formed over 15 days, according to the standard principles of technical analysis.
Wall Street rose for a fourth straight week last week across the three key indices despite a mixed session on Friday. The Dow Jones rose 0.33%, and the S&P500 added 0.06%, but the tech-heavy Nasdaq fell 0.11%. Chip maker Nvidia weighed on the Nasdaq on Friday as shares in the company fell 1.7% after Reuters reported Nvidia told its Chinese clients that it will delay a new artificial intelligence chip designed to comply with U.S. export restrictions, until next year. Declining bond yields are a driving factor behind the four week Wall Street rally as investors come to terms with the idea that the equity market in the US can handle interest rates between 4-5%.
Black Friday and cyber Monday sales periods kicked off over the weekend in the US which sent shares in Walmart, Amazon and target higher on Friday.
Over in Europe, markets in the region also closed higher on Friday as fresh economic data in the region boosted investor sentiment that inflation is continuing to cool. Final German GDP figures for Q3 released on Friday confirmed contraction of 0.1% which is down 0.8% on the PCP. The STOXX600 rose 0.4% higher on Friday while Germany’s DAX added 0.22%, the French CAC rose 0.2% and, in the UK, the FTSE100 ended the day up 0.06%.
Locally on Friday, the ASX200 rose 0.17%, driven by the utilities and energy sectors adding 1.55% and 1.27% respectively. Trading was lacklustre on Friday as Wall Street was closed on Thursday for the Thanksgiving day holiday. The energy sector rally was boosted on Friday by a rebound in the price of oil, while tech stocks weighed on the key index.
In company news, Select Harvest tanked 10.5% after the agricultural company reported net losses deepened to $115m in FY23 from $4.8m in FY22 which led to the company’s final dividend being scrapped. Whitehaven Coal on the other hand rose 3.4% after the company’s $1bn Winchester South coking coal mine was given a recommendation to proceed from the Queensland government’s Coordinator General.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the local market to open the new trading week up 0.21%.
- On the commodities front this morning, oil has retreated again to trade 1.22% lower at US$76.16/barrel, gold is up half a percent at US$2001.60/ounce, iron ore is flat at US$136/tonne and uranium is up 8.45% at US$80.25/pound.
- AU$1.00 is buying US$0.66, 98.32 Japanese Yen, 52.23 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has maintained a buy rating on Clinuvel Pharmaceuticals (ASX:CUV) and a 12-month price target of $24 following the release of an update out of the pharmaceutical company’s competitor. Clinuvel currently has a monopoly position over the market for the treatment of EPP through the distribution of the drug Scenesse which is currently the only globally approved treatment for EPP. The most advanced competitor is Mitsubishi Tanabe which has recently initiated a Phase 3 trial which pushes back the potential approval until CY27 at the earliest, which indicates Clinuvel has monopoly over the market for at least another 3-4 years.
- And Bell Potter has increased the rating on Boss Energy (ASX:BOE) from a speculative hold to a speculative buy rating and maintain a $5.53/share 12-month price target on the uranium miner as the analyst sees an opportunity to buy the dip given the recent pullback in the share price and some key tailwinds mounting in the uranium market. Upcoming catalysts for Boss Energy include the signing of an offtake agreement ahead of first production in December or January, commencement of production with first drummed material in late January to early February 2024, and further momentum in uranium markets as more countries continue including nuclear power as a key part of their green energy transition strategies.
As we head into the Black Friday and Cyber Monday sales for 2023, this promotional period is arguably the most important for ASX-listed retailers. Firstly, they are able to heavily discount old stock to reduce inventory levels. Secondly, retailers gauge investor propensity for retail spend ahead of the busy holiday season, which is especially important as cost-of-living pressures continue to bite.
While some retailers remain resilient despite slowing consumer spend, others have shifted focus in the slow sales environment to invest in AI for customer experience enhancement and to gain market share. We explore what the Black Friday and Cyber Monday sales will reveal for retailers as we close out 2023 and more!
In this week’s wrap, Grady covers:
- (0:30) Why retail inventory levels are a key driver for investors,
- (0:45) Black Friday & Cyber Monday will reveal consumer sentiment,
- (1:28) Australia’s resilient retail spend as a key driver of inflation,
- (2:28) Lovisa (ASX:LOV) remaining a key retail pick for Bell Potter, why?
- (3:32) The best performing stocks on the ASX200 this week,
- (4:42) The most traded stocks by Bell Direct clients this week, and
- (5:16) Key economic data to watch next week.
Read the transcript here
Wall St was closed overnight due to the Thanksgiving day holiday.
Over in Europe, markets closed in the green with the STOXX600 ending the day 0.3% higher, led by oil and gas stocks rising 1.4%. Germany’s DAX closed 0.23% higher, the French CAC ended the trading day up 0.24% and over in the UK the FTSE100 closed Thursday’s session 0.19% in the green.
The ASX extended its losing streak into Thursday’s session closing the day down 0.62%, taking no lead from Wall Street’s rally on Wednesday, as the materials and energy sectors weighed on the key index due to the sliding price of oil and iron ore. Oil’s decline was on the back of OPEC+ delaying its upcoming meeting where it was set to discuss further output cuts to stabilise the price of oil, which naturally caused a sell-off in oil producing stocks yesterday including Woodside and Santos.
Origin Energy emerged from a trading halt yesterday to rally 1.2% after the company said it would extend its shareholders vote on the takeover offer to next month instead of today, following the investment group led by Brookfield announcing a revised takeover offer. The revised offer follows Australian Super which is a majority shareholder in Origin at 17.5%, saying it would vote no to the Brookfield led original offer on the grounds of value. The new offer is for a plan B option if majority of Origin’s shareholders do not vote in favour of the original offer of $9.43/share.
The plan B offer is effectively a lower offer that the investment group will ‘come in and control the company’ for a lower price under an Alternative Transaction offer where shareholders will receive a cash consideration of up to $9.08 per share including dividends. It is a very interesting time for Origin Energy shareholders and the company’s takeover fate will be revealed on December 4th when the Scheme Meeting has been postponed to.
Looking at economic data, Australia’s manufacturing PMI index decreased in November to 47.7 points from 48.2 points in October in a sign of the economic slowdown and confirming that the Australian economy is experiencing a soft landing as a result of interest rate rises to date.
What to watch locally today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.2% at the open this morning.
- On the commodity front this morning,
- Oil is trading down 1.09% to US$76.26/barrel after signs of strong supply from non-OPEC countries, which has been weighing down oil prices.
- Gold is trading 0.15% higher to US$1992.62/ounce and iron ore is down 1.09% to US$136/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Propel Funeral Partners (ASX:PFP) with a 12-month price target of $5.70. The buy rating is maintained as it is expected that organic volume growth will return in the 2nd quarter of 2024 and mid-long term growth to be further supported by ageing baby boomers as the older cohorts reach average life expectancy.
- And Trading Central has identified a bearish signal on Pengana Private Equity (ASX:PCG) , indicating that the stock price may fall from the close of $1.58 to the range of $1.23-$1.25 on a pattern formed over 8 days, according to the standard principles of technical analysis.
Wall St’s November rally reignited on Wednesday with the key indices closing the session higher ahead of the Thanksgiving Day holiday as a decline in bond yields boosted investor sentiment on an equities front, alongside investors remaining optimistic that the US cash rate will be maintained at the Fed’s December meeting. The Dow Jones rose 0.5%, the S&P500 added 0.4% and the tech-heavy Nasdaq rallied 0.5%.
Over in Europe, markets closed mostly higher on Wednesday as investors digested the latest FOMC meeting minutes out in the U.S. alongside several fiscal announcements out of the U.K.
The STOXX600 rose 0.3% buoyed by travel and leisure stocks while oil and gas stocks fell 1.7%. Germany’s DAX rose 0.36% on Wednesday, the French CAC added 0.43%, and, in the U.K., the FTSE100 fell 0.17%.
U.K. finance minister Jeremy Hunt announced a tax cut impacting 27 million workers in addition to new and changes to existing measures including benefits programs, raising the minimum wage, investing in AI, business tax breaks and more. Despite these favourable measures, the U.K.’s FTSE100 closed lower on Wednesday.
Locally on Wednesday, the ASX fell just 0.07%, taking lead from the US and European sell-off on Tuesday weighed down by rate-sensitive sectors as the REIT and tech-sectors fell 1.53% and 1.13% respectively at the closing bell of the midweek session.
De Grey mining rose 4.8% after Bell Potter released a broker note responding to positive drill results out of the gold miner on Wednesday. Bell Potter retained its buy rating following positive results out of the company’s Hemi gold project.
Lovisa shares also lifted 2% on Wednesday after the fashion jewellery company released a trading update at its AGM including overall sales up strongly, driven by the company’s strong global rollout strategy with the first store in China on the horizon soon.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open Thursday’s session down 0.17% despite the overnight rally on Wall St.
- On the commodities front this morning, oil has dipped 1.45% to trade at US$76.65/barrel after OPEC+ delayed a meeting to further discuss production cuts to stabilise oil prices. Gold is down almost half a percent at US$1989/ounce and iron ore is up 0.73% at US$137.50/tonne.
- AU$1.00 is buying US$0.65, 97.86 Japanese Yen, 52.45 British Pence and NZ1.09.
Trading Ideas:
- Bell Potter has reduced the 12-month price target on Brickworks (ASX:BKW) from $28.50 to $27.80 and maintain a buy rating on the leading industrial conglomerate following a 1st quarter trading update at the company’s AGM including the Building Products division in Australia and the US remaining resilient, and margin improvement across both regions. The reason for the target price decrease is due to Brickworks’ revised cap rate of 5.2% and the outlook for further devaluation to come among industrial properties Bell Potter covers.
- And Trading Central has identified a bearish signal on HelloWorld Travel (ASX:HLO) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may fall from the close of $2.44 to the range of $2.00 to $2.08 according to standard principles of technical analysis.
Over in the US today, the November equities rally took a pause with the key indices sliding on Tuesday following the release of some disappointing retail results and alongside the latest FOMC meeting minutes being released. The Dow Jones fell 0.18%, the S&P500 lost 0.2% and the tech-heavy Nasdaq shed 0.59%. Clothing retailers Lowe’s and American Eagle fell 2% and 16% respectively on Tuesday after both retailers reduced outlook for the remainder of FY23 in the tougher retail spend environment. Investors responded negatively to the release of the latest FOMC minutes as officials gave no indication of interest rate cuts on the horizon, despite inflation easing in the US alongside robust economic growth which supports the notion of a soft landing over a recession.
The highly anticipated third-quarter results from leading chipmaker Nvidia were released just before 8am AEDT and investors appeared unimpressed with what they saw as shares fell almost 1% at the closing bell on Wall St. Despite reporting revenue and earnings that beat consensus, the company warned that they expect sales to destinations like China to decline significantly in Q4 due to export restrictions on the region.
And in Europe, markets closed mostly lower on Tuesday as investors await the release of final third-quarter results and ahead of the FOMC meeting minutes released in the US. The STOXX600 fell 0.1%, Germany’s DAX lost 0.01%, the French CAC fell 0.24%, and, in the UK, the FTSE100 shed 0.2%.
The Aussie market rally extended into Tuesday’s session with the ASX adding 0.28% at the closing bell, as news of further stimulus in China boosted the price of iron ore and subsequently the big miners surged in afternoon trade. The new stimulus to boost the world’s second largest economy out of deflationary territory, is through Beijing increasing budget spending to support post-pandemic recovery efforts. China is set to deploy a host of local and central government bonds which will push Beijing’s budget deficit up to a 2-decade high. The Chinese treasury also maintained its benchmark lending rates at a monthly fixing meeting on Monday.
The latest RBA meeting minutes were also released yesterday with a more cautious outlook on the future of rate hikes down under. The minutes noted that underlying inflation was more persistent than expected and the risk of not achieving the 2-3% target range by the end of 2025 had increased.
What to watch today:
- Ahead of the midweek trading session here in Australia, the SPI futures are expecting the ASX to open just 0.08% lower following the sell-off on Wall St overnight.
- On the commodities front this morning, oil is trading 0.34% lower at US$77.54/barrel despite speculation that OPEC+ will intervene again with further output cuts to bolster oil prices, gold is up 1.16% at US$2000/ounce and iron ore is up 1.5% at US$136.50/tonne.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Volpara Health Technology (ASX:VHT) from $1.20 to $0.85 and maintain a buy rating on the MedTech company focused on the early detection of breast cancer, following the release of the company’s first half results. Despite revenue increasing by 17%, this growth rate in revenue more than halved relative to the PCP. Bell Potter’s analyst believes slower than anticipated customer implementations are to be expected in the coming financial years as many clients acquired in the MRS acquisition of 2020 remain on the legacy product rather than upgrading.
- And Trading Central has identified a bullish signal on Patriot Battery Metals (ASX:PMT) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $1.05 to the range of $1.30 to $1.36 according to standard principles of technical analysis.
Wall Street started the shorter trading week strongly, finishing higher by market close on Monday. The Dow Jones jumped 0.58%, the S&P 500 closed 0.74% higher and the tech-heavy Nasdaq ended Monday 1.13% in the green. Markets remain in rally mode post the release of softer-than-expected inflation data out of the world’s largest economy last week.
The tech-driven rally on Monday was led by Microsoft lifting 2%, following the announcement of former OpenAI chief Sam Altman, joining to lead a new research team. Chipmaker, Nvidia also added 2.3% before its earnings report release on Tuesday afternoon.
Over in Europe, markets closed marginally higher as the release of third quarter earnings starts to slow. The STOXX600 closed 0.1% higher, led by oil and gas stocks up 1.3%. Germany’s DAX fell 0.11%, the French CAC gained 0.18% and over in the UK the FTSE 100 ended the day 0.11% in the red.
Locally yesterday, the ASX200 closed 0.12% higher, led by gains in the energy and consumer discretionary sectors of 1.33% and 0.64% respectively. This was slightly offset by losses in the consumer staples sector of 0.83%
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.37% at the open this morning.
- In terms of economic data today, at 10:30am this morning, the RBA minutes meeting will be released following the rise in the cash rate to 4.35%.
- On the commodities front this morning,
- Oil is up 2.26% to US$77.75 with surging crude oil inventories in the US and Russia recently lifting a ban on gasoline exports.
- Gold is down 0.1% to US$1,977 an ounce and iron ore is up 1.51% to US$134.50 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Accent Group (ASX:AX1), despite lowering the price target by $0.15 to $2.35. The slight decrease in the 12-month price target follows the leading athleisure retail company releasing a trading update for the first 19-weeks of FY24 including group owned sales and gross margins remaining broadly flat on the prior corresponding period. The buy rating is maintained though as Accent Group is Bell Potter’s preferred retail sector stock given its scale and exposure in terms of channels, brands and size.
- Trading Central has identified a bearish signal in Lifestyle Communities (ASX:LIC), indicating that the stock price may fall from the close of $17.37 to the range of $14.40 to $14.90, over a period of 15 days, according to the standard principles of technical analysis.
Wall Street closed higher on Friday, extending on the November rally among equities in the US with each of the key indices posting a gain for a third straight week. The rally on Friday extended from the prior sessions on the back of softer-than-expected inflation data being released, boosting investor hopes that further rate hikes will be off the table. The Dow Jones added 0.01% on Friday while the S&P500 rose 0.13% and the tech-heavy Nasdaq added 0.08%.
Shares in clothing retailer Gap soared 30% on Friday, a day after the company posted better-than-expected results for the third quarter. While on the other end of the market, EV charging network ChargePoint tanked 35% after the company announced a change up to its product suite and cut forecast for third-quarter revenue.
Over in Europe, markets closed higher on Friday following the release of eurozone inflation data indicating a sharp slowdown, with October’s YoY inflation reading coming in at 2.9% compared to 4.3% in September. The STOXX600 rose 1%, Germany’s DAX added 0.84%, the French CAC added 0.91%, and, in the UK, the FTSE100 rose 1.26% boosted by a 0.3% decline in retail sales figures to the lowest level since early 2021.
Locally on Friday, the ASX200 fell 0.13% as a sharp decline in the price of oil sparked a sell-off in energy stocks, with the sector ending the day down 1.6%. Industrials and tech stocks offset some of the session’s heavy losses with 0.45% and 0.43% gains respectively.
Gold miners rallied on Friday on a rise in the price of the precious commodity, with Northern Star Resources, Evolution Mining and Bellevue Gold each rising over 3%.
Telix Pharmaceuticals and NextGen Energy were two beneficiaries of the Sohn Hearts & Minds Conference last week after industry experts said the healthcare stock and uranium stock were undervalued and the top stock pick, respectively at the conference.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the local market to open the new trading week 0.4% higher.
- On the commodities front this morning, oil has rebounded to trade 4.1% higher at US$75.89/barrel, gold is down 0.04% at US$1980.01/ounce and iron ore is down 0.38% at US$132.50/tonne.
- 1 Aussie dollar is buying 65 US cents, 97.40 Japanese Yen, 52 British Pence and 1 New Zealand dollar and 9 cents.
- Stocks trading ex-dividend today include Silk Laser Australia and Tamawood. If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has increased the 12-month price target on GrainCorp (ASX:GNC) from $9.45 to $9.55 and maintain a buy rating on the leading Australian grain facilitation company following the release of the company’s FY23 results including underlying NPAT slightly above Bell Potter expectations at $268.9m, revenue up 5% to $8.23bn which topped Bell Potter expectations and lease adjusted operating cash inflow of $534.6m, which is above the inflow of $407.1m in FY22.
- And Trading Central has identified a bullish signal on ClearView Wealth (ASX:CVW) following the formation of a pattern over a period of 278 days which is roughly the same amount of time the share price may rise from the close of $0.58 to the range of $0.69 to $0.71 according to standard principles of technical analysis.
Our Market Analyst, Grady Wulff, sat down with executives from some of the top resource companies on the ASX. Hear from the helm of these companies, on their outlook and operations and discover some hidden investing gems heading into 2024.
In this week's wrap, Grady covers:
- (0:39) Australian Rare Earths' (ASX:AR3) latest drilling campaign
- (1:35) why Spartan Resources (ASX:SPR) entered a trading halt
- (2:22) 92 Energy's (ASX:92E) outlook for uranium
- (3:15) Kingsland Minerals' (ASX:KNG) role in the green energy transition
- (4:14) Patriot Battery Metals' (ASX:PMT) Covette Project exploration.
Wall St closed mixed overnight as the Dow Jones ended a four-day winning streak, down by 0.13%. The S&P 500 and the tech-heavy Nasdaq both finished marginally higher, up 0.12% and 0.07% respectively.
In terms of US shares, Walmart dropped more than 7% after the company offered weak guidance for the current quarter. And Palo Alto Networks also lost 6% after issuing a poor forecast on billings.
Over in Europe, markets closed lower following a reduction in positive sentiment. The STOXX600 closed 0.7% lower, with most sectors ending the trading session in the red. Losses were led by oil and gas stocks with a 2.7% loss following weaker oil prices. Germany’s DAX gained 0.24% overnight, the French CAC dropped 0.57% and over in the UK the FTSE100 ended the day just over 1% in the red.
Locally yesterday, the ASX200 closed Thursday’s session down 0.67% with the energy and information technology sectors leading losses by 1.19% and 1.02% respectively. This was slightly offset by the utilities sector which saw a 0.59% increase by close of market yesterday.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.1% at market open this morning.
- On the commodities front,
- Oil is down 5.03% to US$82.72/barrel following lower demand and eased concerns of scarce supply.
- Gold is up 1.14% to US$1981/ounce and iron ore is trading flat at US$133/tonne.
Trading Ideas:
- Bell Potter has maintained a buy rating on Australian Agricultural Company (ASX:AAC) and has increased its price target by $0.05 to $1.90. The buy rating is maintained as AAC continues to demonstrate growth in through the cycle returns as the revenue shifts from cattle to meat.
- And Trading Central has identified a bullish signal on Myer Holdings (ASX:MYR), indicting that the stock price may rise form the close of $0.54 to the range of $0.59-$0.61, on a pattern formed over 42 days, according to the standard principles of technical analysis.
Wall St closed the trading session higher, following the release of promising inflation data. The S&P 500 rose 0.16%, the tech-heavy Nasdaq gained 0.07% and the Dow Jones traded 0.47% higher on Wednesday.
The US treasury yield increased by 9 basis points, following its 18-basis point fall on Tuesday.
In terms of US shares, following the release of better-than-expected results, Target’s share price increased by 18% with apparel company VF also adding 15%.
Over in Europe, markets closed higher overnight following the release of key data from China and the US. The STOXX600 rose 0.4%, led by technology stocks which gained 2.2% with the majority of other sectors ending the trading day in the green. Germany’s DAX added 0.86%, the French CAC ended the day 0.33% higher and over in the UK, the FTSE100 went up 0.62%.
Locally yesterday, the ASX200 ended the trading day up 1.42% with all but the energy sector ending positive. The biggest gains were made by the real estate and information technology sector which ended the day 4.58% and 3.35% higher respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.11% at the open this morning.
-
In terms of economic data,
- At 10:30 this morning Australian unemployment data is set to be released with a consensus of a 0.1% increase from its previous result of 3.6%.
- On the commodities front,
- Oil is down 2.37% to US$76.41/barrel,
- Gold is down 0.09% to US$1961/ounce
- And iron ore is up 1.92% to US$133/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Life360 (ASX:360) and has increased its 12-month price target by $0.25. The buy rating is maintained by Bell Potter as positive results in Q3 have helped increase the price target to $11.25, which is a greater than 15% premium to the previous share price, hence the buy rating is maintained.
- And Trading Central has identified a bullish signal on Evolution mining (ASX:EVN), indicating that the stock price may rise form the close of $3.78 to the range of $4.35-$4.50 on a pattern formed over 30 days, according to the standard principles of technical analysis.
Wall Street’s recent rally extended into Tuesday’s session as investors welcomed the latest inflation data that came in at an annual rate of 3.2% which was below economists’ expectations of 3.3% and raises investors’ hopes that the Fed’s rate hike campaign is coming to an end. The Dow Jones rose 1.7%, the S&P500 added 2.1% and the tech-heavy Nasdaq jumped 2.5%. The 10-year US Treasury Yield also tumbled below 4.5% following the release of the soft inflation report.
Banks including Bank of America and Wells Fargo rallied on hopes that the US economy could avoid a recession all together.
Home Depot shares lifted nearly 6% on Tuesday following the release of better-than-expected third-quarter earnings results.
Over in Europe, markets also welcomed the cooler-than-expected US inflation data, as markets in the region closed higher on Tuesday. The STOXX600 rose 1.4%, led by retail stocks rising 3.1% while oil and gas stocks fell 0.2%. Germany’s DAX rose 1.76% on Tuesday, the French CAC added 1.4% and, in the UK, the FTSE100 lifted 0.2%.
Locally yesterday, ASX closed 0.83% higher on Tuesday, despite the release of Westpac consumer confidence data for November and NAB business confidence data for October both showing declines against economists’ expectations of respective rises. NAB Business confidence data for October fell a further 2 points despite business conditions edging up, driven by higher sales and profitability while employment eased. This reading indicates businesses remain cautious despite the resilience we are seeing in business conditions.
Westpac consumer confidence for November also fell 2.6% in data out yesterday to 79.9 points indicating consumers are pessimistic following the RBA’s latest rate hike for November placing additional financial pressures on Aussie households.
Energy stocks did most of the heavy lifting on Tuesday with the sector closing 2.54% higher, boosted by Beach Energy rising 5.6%.
Commonwealth Bank of Australia rallied just shy of 1% on Tuesday after Australia’s largest bank released a first quarter trading update including unaudited statutory NPAT up 1% on the PCP to $2.5bn. Operating income was flat though for CBA and operating expenses were up 3%, reflecting higher costs from wage inflation and higher amortisation.
Big bank earnings over the last weeks have indicated strength and resilience by the big four in FY23 and the start of FY24, with revenues boosted by the rising interest rates and the peak of respective Net Interest Margins. Multiple signs have suggested though that future revenue and earnings are likely to ease including slowing mortgage and business credit growth across the board, rising operating costs due to inflation, higher switching by customers between all accessible banks both big and small, and the net interest margin peaking during FY23.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open the midweek session up 1.35% following the strong rally on global markets overnight.
- On the commodities front this morning, oil is trading 0.74% higher at US$78.83/barrel, gold is up 0.85% at US$1962.52/ounce and iron ore is flat at US$130.50/tonne.
- AU$1.00 is buying US$0.65, 97.87 Japanese Yen, 52.03 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Chalice Mining (ASX:CHN) from $7.10 to $5.40 and maintain a speculative buy rating on the exploration company following the release of an update from ongoing hydrometallurgical test work programs the company has been undertaking for its 100%-owned Gonneville deposit. The results demonstrate the potential for higher recoveries to be achieved compared with those assumed in the scoping study released in August this year. The decline in price target is due to lower palladium and platinum price for
Wall St had a mixed start to the trading week with the Dow Jones adding 0.16% as traders look past the US outlook cut from Moody’s. The S&P 500 and the tech-heavy Nasdaq finished the day 0.08% and 0.22% lower respectively.
In terms of US stocks, DaVita, Insulet and Henry Schein all gained over 7% each, with Boeing also adding 4% after Emirates announced a $52 billion order for aircraft, helping lift the Dow.
Over in Europe, markets closed higher overnight with the STOXX 600 closing 0.7% higher with travel and leisure stocks leading the way, adding 1.7%. Germany’s DAX gained 0.73%, the French CAC added 0.6% and over in the UK, the FTSE100 ended the trading session 0.89% in the green.
Locally yesterday, the ASX200 fell 0.40% with all but the utilities sector finishing in the red. Losses were led by the energy sector and the real estate sector which lost 0.88% and 0.56% respectively.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.86% at the open this morning.
- In terms of economic data today,
- Westpac consumer confidence change will be released at 9:30am this morning with a forecast of a 0.7% lowering from the 2.9% in October.
- And later on tonight, over in the US, core inflation data is set to be released with a consensus to maintains its previous result of 4.1%.
-
On the commodities front this morning,
- Oil is up 1.60% to 78 US dollars and 40 cents a barrel with OPEC increasing its 2023 global oil demand growth forecast to 2.46 million barrels per day.
- Gold is up half a percent to 1946 US dollars an ounce and iron ore is up 0.38% to 130 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Elders (ASX:ELD) and has increased its price target to $8.35. The buy rating is maintained by Bell Potter following the release of FY23 results with underlying NPAT ahead of expectations at $103.7m, raising NPAT forecasts in FY24 by 13% and 15% in FY25.
- And Trading Central has identified a bullish signal in Grange Resources (ASX:GRR), indicating that the stock price may rise from the close of $0.51 to the range of $0.53-$0.55, on a pattern formed over 29 days, according to the standard principles of technical analysis.
US equities closed with a second week of gains, with the Dow Jones up nearly 400 points or 1.15%, the S&P500 up 1.56% and the tech-heavy Nasdaq rallying 2.05% higher, after Microsoft leap to all-time highs during Friday’s session. Equities recovered as treasurer yields stabilised.
All European benchmarks ended the trading week in the red. The STOXX 600 closed Friday 1% lower, with food and beverage stocks leading the losses. All sectors were in negative territory, except for oil and gas stocks.
What to watch today:
- The Australian market is set to start the week higher, ahead of key economic indicators out this week. The SPI futures are suggesting a rise of 0.34% at the open this morning.
- In commodities,
- Crude oil is trading almost 2% higher at US$77 per barrel, mirroring the broader market as equities rebounded on Friday.
- Gold is more than 1% lower, below US$1,950 an ounce, weighed down by the strong US dollar and Treasury yields, as the US market anticipates a fall in US consumer sentiment, as well as higher inflationary expectations.
- And iron ore has advanced to US$130 per tonne, its highest level in over 7-months, amid expectations of robust demand and risks to supply.
- And today watch the share price movements of ANZ (ASX:ANZ), Elders (ASX:ELD) and Incitec Pivot (ASX:IPL) as they’re set to release their earnings reports today.
- Also watch Macquarie Group (ASX:MQG), which is set to go ex-dividend today. This may see MQG’s share price fall, as investors take their profits.
Trading Ideas:
- Bell Potter maintains a Buy rating on Life360 (ASX:360) ahead of the release of the companies Q3 results on Wednesday this week. Life360 provides a market leading app for families with features that range from communications to driving safety and location sharing. Bell Potter continue to forecast 2023 revenue and adjusted EBITDA of US$310.8 million and US$13.9 million, consistent with or slightly above guidance, which they expect to be reiterated in the Q3 report. Their price target remains unchanged at $11.00, and at 360’s current share price of $7.96, this implies 38% share price growth in a year.
- Bell Potter also have a Speculative Buy rating on Avita Medical (ASX:AVH), who develop a range of respiratory and regenerative products. Their valuation is $6.85, which at AVH’s current share price of $3.71, implies 84.6% share price growth in a year.
The uranium market over the last month has seen increasing volatility, mostly led by demand across the nuclear fuel sector and limited near-term supply. Globally, the share prices of uranium miners have rallied, with smaller miners outperforming the large-cap uranium stocks. Considering this, we explore the four ASX-listed companies favoured by Bell Potter in the uranium market.
In this week's wrap, Sophia covers:
- (0:12) drivers of the uranium market’s increasing volatility
- (1:23) Boss Energy’s (ASX:BOE) Speculative Hold recommendation
- (1:56) Paladin Energy’s (ASX:PDN) focus on development
- (2:11) Deep Yellow’s (ASX:DYL) Speculative Buy rating
- (2:44) Alligator Energy’s advancement with four projects
- (3:26) the best performing stocks in the ASX200
- (3:52) the most traded stocks & ETFs by Bell Direct clients
- (4:19) five economic news items to watch out for.
Read the transcript here
Wall St closed lower overnight as the S&P 500 fell for the first time in nine trading sessions, losing 0.81%. The Dow Jones and tech-heavy Nasdaq followed suit losing 0.65% and 0.94% respectively overnight. Stocks hit session lows following Federal Reserve Chair, Jerome Powell suggesting that more work may need to be done to lower inflation.
In terms of US shares, Disney rose 7% after reporting better-than-expected profit whist, software design company Arm dipped 6% after its first quarterly report as a public company.
European markets closed higher overnight following a series of robust corporate earnings. The STOXX600 closed 0.8% higher, led by industrials gaining 2.5%. Germany’s DAX closed 0.81% higher, the French CAC ended the trading session 1.13% in the green and over in the UK the FTSE100 gained 0.73%.
Earnings played a significant role in European market sentiment, with AstraZeneca up 2.6%.
Locally yesterday, the ASX 200 closed 0.28% higher, led by a close to 1% increase from both the health and communication services sectors. However, this was heavily offset by a 4.83% drop in the information technology sector.
What to watch today:
- The Australian share market is set open slightly lower, with the SPI futures suggesting a fall of 0.04% at the open this morning.
- In terms of economic data, at 10:30 this morning, The RBA will make a statement on monetary policy.
- And on the commodities front today,
- Oil is up 0.37% to 75 US dollars and 61 cents a barrel, following a 2% price fall on Wednesday, its lowest since mid-July.
- Gold is up 0.44% to 1958 US dollars an ounce and iron ore is up 0.79% to 128 US dollars a tonne with China expected to offset the debt crisis for the residential construction sector, maintaining active purchasing activity for iron ore inputs.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on ikeGPS Group (ASX:IKE) and has held on to its valuation of $0.88. The speculative buy rating is maintained by Bell Potter due to the medium and long-term outlook opportunity, underpinned by a forecasted investment of 410 billion US dollars into the North America 5G, fibre and rural broadband rollout.
- And Trading Central has identified a bullish signal on Car Group (ASX:CAR), indicating that the stock price may rise from the close of $29.37 to the range of $31.90-$32.60 on a pattern formed over 59 days, according to the standard principles of technical analysis.
US markets saw little change overnight, with the Dow Jones down 0.12%, while the Nasdaq gained 0.08% and the S&P500 ended 0.1% higher. The S&P500 gained for the eight straight day, making this the longest win streak in 2 years.
European markets closed higher, with the STOXX 600 recovering earlier losses of around 0.3%. The release of earnings results was the key driver share price movements in Europe overnight, with Credit Agricole, Adidas, ABN Amro and Marks and Spencer all reporting before the bell.
What to watch today:
- Our local market is set to open higher, with the SPI futures suggesting a rise of 0.36% at the open this morning.
- In commodities,
- The price of crude oil has sharply dropped, trading over 2% lower at the time of recording, at around US$75 per barrel. This is the lowest level since the 20th of July this year. The fall was prompted by emerging demand concerns from the largest consumers, the US and China. And adding to worries about global demand is the weaker-than-expected Chinese exports in October. So, keep watch of ASX energy producers today.
- The gold price is also lower, extending its decline for the third session in a row, pressures by the higher US dollar,
- While iron ore is in the green, sitting at its highest level in 7-months at US$127 per tonne.
- Today, watch the share price movements of NAB, with the bank set to release its full year results. Goldman Sachs analysts are expecting cash earnings up to 11% on the prior corresponding period, ahead of consensus. Goldman Sachs also are expecting a final dividend of 83 cps, in line with consensus.
- And companies that are set to hold their AGMs today include Amcor (ASX:AMC), De Grey Mining (ASX:DEG), Nine Entertainment (ASX:NEC) and Star Entertainment (ASX:SGR).
Trading Ideas:
- Bell Potter maintains a Buy rating on Adacel Technologies (ASX:ADA) a global provider of simulation and control systems from the civil aviation and defence sectors. Their core products are air traffic control simulation systems and air traffic management automation systems. Bell Potter have increased their price target on the stock by 13% to $0.90. At ADA’s current share price of $0.78, this implies 15.4% share price growth in a year.
Wall St ended the trading day higher again across the key indices with the S&P500 up 0.28%, rising for a 7th consecutive session, while the Dow Jones rose 0.17% and the tech-heavy Nasdaq ended the day 0.9% in the green.
Tech stocks lead the charge on Tuesday due to a pullback in treasury yields, making equities more attractive to investors, with Microsoft, Apple and Amazon each up over 1% on Tuesday.
Over in Europe, third-quarter earnings results weighed on markets in the region causing each to close mostly lower on Tuesday. The STOXX600 fell 0.3% as oil and gas stocks fell 1.85% after Saudi energy giant Aramco reported a steep decline in profit, while financial services stocks rose 0.9%. Germany’s DAX rose 0.11% on Tuesday, while the French CAC fell 0.4%, and, in the UK, the FTSE100 fell 0.1%.
The ASX closed 0.3% lower on Tuesday after the widely expected 25-basis point rate hike was handed down by the RBA in a bid to combat the nation’s sticky inflation under new RBA governor, Michele Bullock. Financial stocks weighed on the key index, with the sector sliding 1.04% while energy stocks fell 0.8% at the closing bell on Tuesday. While the market was factoring in the rate rise before yesterday, the slide in the key index came after RBA governor, Michele Bullock, left the possibility for further rate hikes open to ensure inflation which is currently at 5.4%, returns to the target range of 2-3% by December 2025.
What to watch today:
- The Australian share market is set to open flat this morning at market open.
- On the commodities front this morning,
- Oil is down 4.14% to US$77.48 a barrel following concerns over China’s report of a worse-than-expected drop in exports in October.
- Gold is down 0.46% to US$1968 an ounce and iron ore is trading flat at US$126.50 cents a tonne.
Trading Ideas:
- Bell Potter has initiated coverage on Universal Store Holdings (ASX:UNI) and has recommended a buy. The buy rating is initiated as Universal’s higher margin sales from the majority private label sales will become a major driver of margin improvement and earnings growth.
- And Bell Potter maintains a speculative buy rating on Matrix Composites & Engineering (ASX:MCE) and has slightly increased its price target to 34 cents a share. MCE is exposed to a protracted capital expenditure up-cycle across the global off-shore energy sector. This view is reinforced by record-high order backlogs and upgraded medium-term outlooks reported by offshore energy service providers.
Well US equities closed slightly higher overnight with all three major benchmarks in the green, with the Nasdaq marking its longest positive streak since January.
European markets closed lower, with the STOXX 600 down 0.2%, as sector movements were muted. Only oil and gas stocks gained.
What to watch today:
- The Australian share market is set to open lower this morning, with the SPI futures suggesting a 0.17% decline.
- In economic data, at 2:30pm today the RBA will announce its next interest rate decision. After four months of holding the cash rate steady, today interest rates are expected to lift from 4.1% to 4.35%, off the back of higher-than-expected quarterly inflation and strong spending figures.
- Looking at commodities,
- Oil is strong, recovering losses from the previous session following top crude producers Saudi Arabia and Russia, announcing that they’ll maintain extra voluntary oil output cuts until the end of the year.
- Gold is in the red has investors weigh the latest economic data against geopolitical risks.
- And iron ore is trading at its highest level in seven months, amid hopes that economic stimulus from the Chinese government will create demand for resources.
Trading Ideas:
- Bell Potter maintains a buy rating on Cobram Estate Olives (ASX:CBO) a vertically integrated producer and marketer of olive oil products with operations in Australia and the US, and export customers in approximately in 17 countries. Their 12-month price target is $1.70 and at CBO’s current share price of $1.29, this implies 32% share price growth in a year.
- And Trading Central have identified a bullish signal in Beacon Lighting Group (ASX:BLX), indicating that the stock price may rise from the close of $1.84 to the range of $2.03 to $2.07 over 18 days, according to the standard principles of technical analysis.
Wall St closed the trading week higher on Friday, capping off the best week for US stocks so far this year after a soft jobs report drove bond yields lower. The Dow Jones closed 0.66% in the green, the S&P 500 ended the trading week nearly one percent higher and the tech-heavy-Nasdaq rose 1.38% on Friday.
October jobs reports data was released on Friday coming in lower than expected, with the US economy adding 150,000 jobs, 20,000 lower than the 170,000 consensus estimate from Dow Jones. US unemployment data was also released on Friday, with a rise to 3.9%, with expectations of it holding steady at 3.8%.
Over in Europe on Friday, markets closed slightly higher, ending a week powered by solid earnings reports. The STOXX600 ended out the week 0.2% higher, led by retail stocks which saw a 1.7% rise. Germany’s DAX closed off the week 0.30% higher whilst the French CAC and the UK’s FTSE 100 ended the trading week 0.19% and 0.39% in the red respectively.
Locally on Friday, the ASX200 closed 1.14% higher, with all but the energy sector finishing in the green. The industry and real estate sectors led the way gaining over 2% each.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.2% at market open this morning.
- On the commodities front this morning,
- Oil is down 2.36% to 80 US dollars and 51 cents a barrel, as China manufacturing levels have dropped into a contraction.
- Gold is up 0.35% to 1992 US dollars an ounce, underpinned by a weaker US dollar and lower treasury yields.
- And iron ore is up 0.80% to 125 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Regal Partners (ASX:RPL) and has increased their 12-month price target to $3.40. The buy rating is maintained as the company has acquired 50% of Taurus, a specialist provider of financing solutions to global mid-tier and junior mining companies. The acquisition of Taurus will add to funds under management, will enhance earnings per share and does not involve issuance of equity.
- And Bell Potter maintains a hold rating on CSR (ASX:CSR) and has increased its price target to $5.70. The hold rating is maintained as the group is now past the peak of its current pricing cycle and as such, it is expected that recovery of fixed costs will become more challenging in FY25 as construction headwinds align.
Volatility in global markets continued into the last trading week of October, however, so far November has started on a green note across the key trading regions. Investors started buying again given Fed maintained the US cash rate for another term, eurozone inflation data came in at a 2-year low for October, and Australian quarterly company results showed resilience across some sectors.
Concurrently, governments worldwide are actively pressing forward with the transition to green energy with key commodities playing a vital role.
In this week's wrap, Grady covers:
- (0:33) geopolitical tensions and China’s recovery post-pandemic,
- (0:52) the rally of infrastructure investment company, Infratil,
- (1:02) governments pushing for a transition to green energy,
- (2:52) key commodities’ impact on the energy transition,
- (3:49) the $2 billion Hydrogen Headstart program,
- (5:11) the best performing stocks in the ASX200,
- (6:06) the most traded stocks & ETFs by Bell Direct clients, and
- (6:34) five economic news items to watch out for.
Wall St rallied overnight as treasury yields fell which saw the Dow Jones have its best day since June, ending the session up 1.7%. The S&P 500 and the tech-heavy-Nasdaq followed suit, gaining 1.89% and 1.78% respectively at the closing bell. All 11 sectors in the S&P 500 ended the day in the green, led by gains in the energy and real estate sectors.
US treasury yields dropped to 4.67%, after the benchmark yield topped 5% last month.
US Data was released overnight showing easing inflation and a slowing labour market, which added to investor confidence that the Federal Reserve may be done raising rates for the time being.
Over in Europe, markets closed higher, following investor reaction to the Federal Reserve holding rates over in the US. The STOXX 600 ended the day 1.6% higher with all sectors positive, led by auto stocks up 3% and tech stocks up 2.7%. Germany’s DAX ended the day up 1.48%, the French CAC closed the trading session up 1.85% and over in the UK the FTSE 100 gained 1.42%.
Locally yesterday, the ASX 200 finished 0.9% in the green led by the information technology and real estate sectors which gained 3.23% and 2.35% respectively. However, this was offset by the utilities sector which lost 3.83% on Thursday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 1.23% at the open this morning, extending the green run into the final trading session of the week.
- In terms of economic data,
- US Non-Farm Payrolls data is set to be released after Australian market close with a forecast of 180,000 new jobs added to the US economy in October which is down from the 336,000 recorded in September.
- And US unemployment rate data will also be released with a forecast to remain steady at 3.8%.
- On the commodities front this morning,
- Oil is up 2.51% to 82 US dollars and 46 cents a barrel, following the Federal Reserve’s decision to maintain rates.
- Gold is up 0.18% to 1985 US dollars an ounce and iron ore is up 0.81% to 124 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Graincorp (ASX:GNC) and maintains the 12-month price at $9.45 on the agricultural stock. The buy rating is maintained as the share pricing in a material retracement is below normalised crop level earnings and there is also a potential utilisation of surplus capital through investment in new oilseed crush capacity that lifts the sustainable earnings base.
- And Trading Central has identified a bullish signal in Pacific Current Group (ASX:PAC), indicating that the stock price may rise from the close of $9.91 to the range of $11.20-$11.70 on a pattern formed over 26 days according to the standard principles of technical analysis.
Wall Street rallied overnight after the Federal Reserve maintained the U.S. cash rate at 5.25%-5.5% for another term as was expected by economists amid inflation continuing to fall in the world’s largest economy. The Dow Jones rose 0.7%, the S&P500 added 1.05%, and the tech-heavy Nasdaq has the biggest rise of 1.64%. The Fed’s decision to maintain and not hike the US cash rate was received positively by markets however Fed Chair Jerome Powell did not rule out further rate hikes in future if inflation rebounds. Positively, economic data released in recent times all point toward economic stability while inflation also cools which supports the idea of a soft landing as opposed to a recession, with the latest ISM Manufacturing index showing manufacturing activity contracted more than expected in October.
Over in Europe, markets closed higher on Wednesday ahead of the Fed’s interest rate decision with the STOXX600 rising 0.7%, buoyed by retail stocks climbing 1.7%. Germany’s DAX added 0.76% on Wednesday, the French CAC lifted 0.68%, and in the UK, the FTSE100 rose 0.28%.
Shares in Aston Martin plunged 13% yesterday after the luxury car maker reported a bigger-than-expected quarterly loss and cut its volume target. The European rally also came off the back of fresh euro zone inflation data being released showing inflation in the region hit a 2-year low of 2.9% in October.
Locally yesterday, the ASX200 extended its green run into the midweek session, closing the day up 0.85% led by real estate stocks lifting 1.85%, while the health care and energy sectors added 1.45% and 1.13% respectively. The local rally was driven by strength in the US on Tuesday and the big miners rose on the back of the rising price of iron ore.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open Thursday’s session up 0.76%, extending the green run into a third session.
- On the commodities front this morning, oil is trading 0.15% lower at US$80.90/barrel, gold is flat at US$1982/ounce and iron ore is up 1.23% at US$123.50/tonne.
- AU$1.00 is buying US$0.64, 96.51 Japanese Yen, 52.22 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the rating on Infomedia (ASX:IFM) from a hold to a buy and maintain a 12-month price target of $1.75 ahead of the company’s AGM in November where it is expected at least reiterate the FY24 revenue guidance. Bell Potter now sees reasonable value in the stock with the FY24 PE ratio back around 30x and some prospect of a soft upgrade is expected at the at the upcoming AGM.
- And Bell Potter has downgraded Ingham’s Group (ASX:ING) from a buy to a hold and have slightly increased the 12-month price target to $3.95 from $3.90 following the release of a first quarter trading update from Australia’s leading poultry producer. The update was ahead of Bell Potter expectations including underlying EBITDAL guidance of $128m, underlying NPATL of $71m, and the expectation of 2H24 to be below 1H24 reflecting traditional seasonality in the business and feed cost inflation. Alternative meats like beef and lamb prices have also contracted while poultry prices have outperformed competing animal protein sources over the last 18-months. The downgrade to a hold is in light of recent share price strength as well as exposure to feed cost inflation again emerging without comparable inflation in competing protein products.
Wall St closed higher overnight, having regained some ground on a poor month strongly impacted by rising interest rates. Rising treasury yields are pressuring equities on Wall St to end a volatile trading month on the New York Stock Exchange. The Dow Jones is up 0.38%, the tech-heavy-Nasdaq closed the session nearly half a percent higher and the S&P500 ended the day 0.65% in the green. Stocks are heading for a third straight losing month, marking the first three-month losing streak for both the Dow Jones and S&P500 since March 2020.
Earnings season continued on Tuesday with Caterpillar exceeding estimates for the third quarter, however signalling fourth-quarter revenue would only be slightly higher than a year ago which caused shares in the company to fall 5% on Tuesday.
JetBlue also fell 14% after the airline’s third-quarter results missed expectations on both the top and bottom lines.
In Europe markets logged the worst monthly performance in a year for the month of October despite mostly rising on the final trading day of the month, as investors digested a slew of economic data against earning results.
The STOXX600 rose 0.6%, Germany’s DAX rose 0.64%, the French CAC added 0.9% and, in the UK, the FTSE100 fell just 0.08%, weighed down by BP falling 4.5% after the mining giant missed third quarter estimates.
The ASX200 closed slightly higher on Tuesday by 0.1% buoyed by real estate and consumer staples stocks rallying despite China’s industrial activity falling into contraction mode in October. At the other end of the market, the materials sector fell over 1% on Tuesday, tracking the declining price of iron ore.
Gold miner St Barbara fell over 10% after posting higher all-in-sustaining-costs at both of its mines in PNG and Canada.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.52% at the open this morning.
- On the commodities front, oil is trading 1.22% lower at 81 US dollars and 20 cents a barrel, gold is down 0.6% at 1983 US dollars an ounce and iron ore is down 0.41% at 122 US dollars a tonne.
- AU$1.00 is buying US$0.63, 96 Japanese Yen, 52.34 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter maintains a buy rating on Burgundy Diamond Mines (ASX:BDM) and holds its price target steady at $0.50. The buy rating is maintained as the potential for experienced management to enhance the value of an already top-10 global diamond mine is a key tenet to a positive investment view.
- And Trading Central identifies a bearish signal on Reece (ASX:REH), indicating that the stock price may fall from the close of $17.46 to the range of $13.90-$14.60, on a pattern formed over 131 days, according to the standard principles of technical analysis.
Wall St rallied on Monday prior to a big week ahead with the Federal Reserve’s rate decision, jobs reports and Apples’ earning set to be released. The Dow Jones had its best day since June, ending the session up 1.58% while the S&P 500 and the tech-heavy Nasdaq followed suit, rising 1.20% and 1.16% respectively.
The communications services sector was the leader on Monday, while tech giants Amazon and Meta led the tech sector, gaining 3.9% and 2% respectively.
The US Federal Reserve interest rate decision is set to be announced on Wednesday with the market expecting the central bank to hold its benchmark interest rate steady at 5.25%-5.5% for the next term.
Over in Europe, markets closed higher despite the continued rising geopolitical tensions in the Middle East. The STOXX600 closed the day 0.4% higher with most sectors ending the trading day in the green. Germany’s DAX closed out Monday’s session 0.20% higher, the French CAC ended the day 0.44% in the green and over in the UK, the FTSE100 gained 0.5%.
Locally yesterday, the ASX200 fell 0.79% with the energy and consumer staples sectors leading the losses by 2.59% and 1.27% respectively. This was slightly offset by the information technology sector which rose 0.43% yesterday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.43% at the open this morning following the global rally overnight.
- In terms of economic data,
- Australia’s all-important retail sales data came out yesterday, which saw a 0.9% rise for the month of September, which well-exceeded economists’ expectations of a 0.3% rise. This provides further support for the RBA to raise interest rates again on Melbourne Cup Day as consumer spend remains resilient in the high inflationary environment.
- On the commodities front this morning,
- Oil is down 3.78% to 82 US dollars and 31 cents a barrel as investors await economic monetary policy outlook and continued fears over the war in the Middle East.
- Gold is down 0.48% to 1996 US dollars an ounce, as investors await the Fed’s decision on interest rates on Wednesday.
- And iron ore is up 1.66% to 122 US dollars and 50 cents a tonne as renewed stimulus measures in China prompted an improved outlook for commodity demand.
Trading Ideas:
- Bell Potter maintains a buy rating on Seven Group Holdings (ASX:SVW) and holds its price target steady at $33. The buy rating is maintained as Seven Group Holdings are market leaders in the industries it operates within, with scale, brand and industry expertise underpinning commercial advantages that are hard to replicate by competitors.
- And Trading Central has identified a bullish signal on Beacon Lighting Group (ASX:BLX), indicating that the stock price may rise from the close of $1.83 to the range of $2.03-$2.07, on a pattern formed over 33 days, according to the standard principles of technical analysis.
Wall Street closed mixed across the key indices on Friday, pushing the S&P500 into correction territory as the index is now down 10.3% since its 2023 peak in July. The Dow Jones fell 1.12%, and the S&P500 lost almost half a percent, but the Nasdaq rose 0.38% on Friday buoyed by Amazon jumping over 6% on better-than-expected earnings and revenue for the third quarter.
Investors in the US have assessed disappointing earnings results against economic uncertainty which have led to the S&P500 and Nasdaq now entering correction territory. For the trading week last week, all three key indices lost of 2% each. US equities were also pressured on Friday by investor fears of further interest rate hikes after U.S. GDP data showed the economy grew by 4.9% in the third quarter which well exceeded estimates.
Over in Europe, markets in the region closed lower as investor sentiment remains shaky on geopolitical tensions and economic instability. The STOXX600 fell 0.8%, weighed down by healthcare stocks falling 2.9, while Germany’s DAX lost 0.3%, the French CAC fell 1.36% and, in the UK, the FTSE100 shed 0.86% on Friday. NatWest shares fell 11% on Friday after the bank reported third quarter results that showed net interest margin declining.
Locally on Friday, the ASX200 rose 0.21%, but for the week the ASX200 fell 1.07% as investor fears of an RBA rate hike on Melbourne Cup Day rose on the back of stronger-than-expected CPI data released earlier last week. On Friday, consumer staples stocks did most of the heavy lifting to close 1.33% higher driven by Endeavour Group and Coles Group.
ResMed shares fell 4% on Friday after the healthcare company’s September quarter update outlined higher costs further dampened the company’s margins, while Silver Lake Resources and Champion Iron rose 7.7% and 6.9% respectively on Friday.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the local market to open the first trading session of the new week down almost 1% following the turbulence on Wall Street on Friday.
- On the commodities front this morning, oil is up 2.18% at US$85.03/barrel, gold is up 1.08% at US$2006/ounce and iron ore is flat at US$120.50/tonne.
- We will be keeping a close eye on the retailers as Australia’s retail sales data for September is out at 10:30am AEDT with consensus expecting a rise of 0.3% from a 0.2% rise in August. Any slowdown in consumer spending may see further weakness in consumer discretionary stocks especially following some disappointing quarterly results out of retailers over the last week.
- AU$1.00 is buying 63 US cents, 94.79 Japanese Yen, 52 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has downgraded the rating and price target on Clean Seas Seafood (ASX:CSS) from a buy to a hold and with a 12-month price target of 47cps, down from 60cps, following commentary made at the company’s AGM and on the release of a trading update. Clean Seas highlighted a more sombre trading update than Bell Potter expected including 1Q24 sales volume down 1% and frozen inventories up 44% YoY which is a trend Bell Potter would like to see reverse over the remainder of FY24. Average selling prices were also down 2% relative to average 2H23 pricing.
- And Bell Potter has increased the 12-month price target on Fortescue Metals Group (ASX:FMG) from $15.53 to $16.21 and maintain a sell rating on the mining giant following the release of the company’s September quarter trading update including iron ore shipments and cash costs missing expectations, and net debt increasing due to the distribution of dividends. The price target increase is due to favourable outlook for iron ore prices and foreign exchange forecasts.
Higher fuel prices, rising rental costs and increased electricity prices were the key drivers of Australia’s inflation rate rising 1.2% in the September quarter, which is unsurprising as these drivers have remained the sticky points in taming inflation. This week, we explore how a 25-basis points rate hike may impact investment portfolios, the cost-of-living, and Aussie companies.
In this week's wrap, Grady covers:
- (0:11) key drivers of Australia’s inflation rate,
- (0:34) economists expecting a rate hike,
- (1:16) the Senate estimates hearing on Tuesday,
- (2:20) what the rate hike will mean for investors and businesses
- (3:06) quarterly trading updates and results,
- (4:37) the best performing stocks in the ASX200,
- (5:44) the most traded stocks & ETFs by Bell Direct clients, and
- (6:15) five economic news items to watch out for.
Wall St closed lower on Thursday as earnings season results failed to live up to investor expectations. The tech-heavy Nasdaq had the sharpest decline out of all three major indices losing 1.76%, dropping deeper into correction territory following the release of results from technology company Meta which fell short of expectations. The S&P 500 and the Dow Jones also finished the day in the red, losing 1.18% and 0.76% respectively.
Over in Europe, markets closed lower as investor attention remains on earnings season and government bond yields. The STOXX 600 closed down 0.5% with most major sectors finishing in negative territory. Germany’s DAX closed just over one percent lower, the French CAC ended the trading day down 0.38% and over in the UK the FTSE 100 retreated 0.81%.
Locally yesterday, the ASX 200 closed 0.61% lower with the information technology and real estate sector closing 2.56% and 2.07% lower respectively. This was slightly offset by the utilities sector which gained 1.30% by market close yesterday.
What to watch today:
- The Australian share market is set to open slightly lower, with the SPI futures suggesting a fall of 0.04% at the open this morning.
- On the commodities front this morning,
- Oil is down 2.08% at 83 US dollars and 61 cents a barrel following an increase in supply, with crude oil inventories unexpectedly rising by 1.371 million barrels.
- Gold is up 0.25% to 1984 US dollars and 57 cents an ounce as investors react to stronger than expected economic data from the US.
- And iron ore is trading flat, at 120 US dollars and 50 cents a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Gold Road Resources (ASX:GOR) despite increasing its price target to $2.10. The buy rating is maintained as an expansion of their gold mines is yielding increased profitability and cash build. Beyond the expansion, Gold Road’s corporate strategy includes the establishment of a second, 100% owned gold mine.
- And Trading Central has identified a bullish signal in SG Fleet Group (ASX:SGF), indicating that the stock price may rise from the close of $2.54 to the range of $2.82-$2.88 on a pattern formed over 21 days, according to the standard principles of technical analysis.
Wall Street closed lower on Wednesday on the back of disappointing earnings results and rising treasury yields. The S&P500 fell 1.43% on Wednesday, while the Nasdaq tumbled 2.43% and the Dow Jones lost 0.32%. Google’s parent company, Alphabet, tumbled more than 9% after the tech giant posted quarterly results that beat expectations for earnings and revenue growth but missed expectations for the company’s cloud business. The benchmark on the 10-year treasury yield climbed nearly 11 basis points to hit 4.95%.
Over in Europe, markets closed mixed as investors reacted to the release of corporate earnings results. The STOXX600 closed flat as mining stocks rose almost 1% while retail stocks fell 1.3%.
Kering shares fell 3% on Wednesday after the French luxury group reported a 9% decline in sales for the third quarter.
Germany’s Deutsche Bank rose 8% yesterday after reporting a third-quarter net profit of 1.031bn euros, which beat analysts’ expectations.
The local market closed relatively flat on Wednesday to end the day down just 0.04% or 2.6 points as investors weighed a Tuesday rally on Wall Street against hotter-than-expected inflation reading for Australia in the September quarter.
Australia’s CPI data released yesterday showed the country’s headline inflation rose 1.2% in the September quarter to an annual rate of 5.4%, below the 6% recorded in Q2 but slightly above economists’ expectations of 5.3%. The key driver of inflation rising 1.2% in the September quarter were unsurprisingly fuel prices up 7.2%, rental prices up 2.2% and electricity prices up 4.2%.
Prior to the release of the latest CPI reading, three of the big four Aussie banks believed the nation’s cash rate had peaked at 4.1%, and after the release of the inflation reading coming in hotter-than-expected, NAB, CBA and ANZ now believe another interest rate hike is in-store for Aussies set to be announced on Melbourne Cup Day. The move in bank expectations also follows Michele Bullock’s first speech as governor of the RBA on Tuesday night where she said the board ‘will not hesitate to raise the cash rate further if there is a material upward revision in the outlook for inflation’.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Thursday’s session down 0.26% following the sharp sell-off on Wall St overnight.
- On the commodities front this morning, oil is up 1.85% at US$85.29/barrel, gold is up 0.46% at US$1979.15/ounce and iron ore is up 1.26% at US$120.50/tonne.
- AU$1.00 is buying US$0.63, 94.73 Japanese Yen, 52.08 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on IVE Group (ASX:IGL) from $2.75 to $2.65 but maintain a buy rating on the largest integrated marketing communications business in Australia after the company announced it signed a binding agreement to acquire 100% of JacPac, a Melbourne based packaging company for a total purchase consideration of $35m.
- Trading Central has identified a bearish signal on Downer EDI (ASX:DOW) following the formation of a pattern over a period of 84-days which is roughly the same amount of time the share price may fall from the close of $3.76 to the range of $3.10 to $3.20 according to standard principles of technical analysis.
Over in the US, Wall Street closed in the green as investors assess the latest corporate results released alongside a retreat in treasury yields. Coca Cola shares closed higher after the beverage giant posted revenue and earnings that topped market expectations, while music streaming service Spotify soared 10% after the company posted third quarter results that topped expectations.
In Europe, markets snapped a 5-session losing streak to close higher on the release of strong corporate earnings results, despite unfavourable economic data being released. Hermes shares rose after the luxury retailer reported a 16% spike in sales growth for the third quarter. And the STOXX600 rose 0.4% on Tuesday, boosted by mining stocks rising 2.6%.
The ASX overcame Monday’s sell-off, closing higher yesterday as investors shook off fears of an extended war in the Middle East and bond yields continued to retreat, increasing demand for equities. The energy and materials sectors did most of the heavy lifting on the local market yesterday on the rising price of oil and iron ore.
What to watch today:
- Our local market is set to open higher this morning, with the SPI futures suggesting a 0.35% rise at the open.
- In economic news, inflation data is out today which will give investors and the RBA an indication of how well the rate hikes to date have worked toward taming inflation. The market is expecting Q3 inflation to drop to 5.3% year-on-year from 6% year-on-year in Q2. The recent key drivers have been services and housing inflation which will be two key metrics that the RBA and investors assess in the data out later today. Pending the result, we will likely see the ASX move accordingly after the data is released this morning, with sectors that are rate-sensitive like Tech and REIT stocks, likely to have the biggest impact.
- In commodities,
- Crude oil is trading lower, extending losses for the third session.
- Gold is slightly lower, pausing its recent climb to a five-month high off the back of a stronger US dollar and elevated yields, as investors awaited US GDP and inflation numbers.
- While iron ore is trading higher, so keep watch of ASX-listed iron ore stocks today.
- And AU$1.00 has slightly strengthened to buy US$0.64, 95.24 Japanese Yen, 51.93 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter maintains a Buy rating on Bega Cheese (ASX:BGA). Their price target is $3.35 and at its current share price of $2.91, this implies 15% share price growth in a year.
- And Trading Central have identified a bullish signal in Perseus Mining (ASX:PRU) indicating that the stock price may rise from the close of $1.76 to the range of $1.86 to $1.89 over 23 days, according to the standard principles of technical analysis.
Wall St closed mixed on Monday as the Nasdaq ended a four-day losing streak and treasury yields retreat from its 5% high. The Dow Jones closed 0.58% lower, the S&P 500 closed 0.17% lower and the tech-heavy Nasdaq ended the day 0.27% in the green.
In terms of US shares, oil company Chevron fell 3.7% following the announcement that the company would be purchasing fellow peer, Hess in an all-stock deal. Pharmacy giant, Walgreens gained 3% following an upgrade from JP Morgan and online security stock Okta retreated 8% following a data breach.
Earnings season continues with tech giants Alphabet, Amazon, Meta and Microsoft all releasing key information to the stock market this week.
Over in Europe, markets closed lower with the STOXX 600 losing 0.1% on Monday. Retail and travel stocks posted strong gains, however, heavy losses among the miners weighed on the markets in the region.
Germany’s DAX gained just 0.02%, the French CAC gained half a percent, however over in the UK the FTSE 100 lost 0.37%.
Locally yesterday, the ASX 200 closed 0.82% lower with the energy and materials sector losing 3% and 2.34% respectively. This was offset by the health sector which gained 1.53% by market close yesterday.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.22% at the open this morning, extending the losing run into Tuesday’s session.
- On the commodities front this morning,
- Oil is down 2.21% to 86 US dollars and 13 cents a barrel as efforts to keep the Israel-Hamas war from spreading to a wider conflict in the Middle East are easing concerns about supply disruptions.
- Gold is down 0.81% to 1965 US dollars an ounce as treasury yields moved up and the Middle Eastern War dented demand for the safe-haven asset.
- And iron ore is down 0.86% to 115 US dollars a tonne as worries about China’s debt-ridden property sector hampered the outlook on the country’s resource demand.
Trading Ideas:
- Bell Potter maintains a buy rating on Aeris Resources (ASX:AIS) with an unchanged 12-month target of $0.30. The buy rating is maintained as Aeris Resources is a copper-dominant producer with all assets in Australia. Its near-term outlook remains highly leveraged to increasing copper grades at the Tritton copper mine, where high graded ore sources have commenced production and exploration success is likely to sustain it.
- And Trading Central has identified a bearish signal on Commonwealth Bank (ASX:CBA), indicating that the stock price may fall from the close of $97.82 to the range of $71-$76 on a pattern formed over 468 days, according to the standard principles of technical analysis.
Rising bond yields sparked a sell-off on Wall Street on Friday as investors remain concerned about the broader state of the U.S. and global economies. The yield on the benchmark 10-year treasury note topped 5% for the first time in 16-years on Friday which offers investors a safer return on investment than the current volatility of equity markets in the U.S.
The Dow Jones fell 0.86% on Friday while the S&P500 lost 1.26% and the tech-heavy Nasdaq shed 1.53%. For the week, the Dow Jones fell 1.2%, the S&P500 shed 2.4% and the Nasdaq took the biggest hit, falling 3.2%.
American Express shares fell 5% on Friday after the big bank reported earnings per share that beat expectations, but revenue came broadly in line with expectations.
Tesla shares also tumbled over 15% across the trading week after the EV giant reported earnings on Wednesday that missed expectations on both the top and bottom lines.
Over in Europe, markets closed at the lowest level in 2023 on Friday on rising treasury yields and fears of further monetary tightening out of the US. Comments made by US Fed Chair, Jermone Powell, around the need to continue with a tightened monetary policy until inflation hits the target 2% range, sparked global investor fears of further rate hikes out of the world’s largest economy. The yield on the 30-year UK government bonds hit the highest level since 1998 on Friday amid rising tensions in the Middle East and the global fear of “higher for longer” pushing investors to favour bonds over other riskier assets in the current market. The STOXX600 fell 1.3%, Germany’s DAX lost 1.64%, the French CAC shed 1.52% and, in the UK, the FTSE100 fell 1.3%.
Locally on Friday, the ASX200 fell 1.16%, weighed down by the materials sector falling 1.7% while the communication services, and healthcare sectors fell 1.43% each. 10 of the 11 sectors on the local market closed lower on Friday as surging bonds and tensions in the Middle East weighed on local investor sentiment. Energy stocks were the only equities to rally on Friday as the price of oil continues to climb as tensions in the oil producing hub of the Middle East continue rising.
Liontown Resources (ASX:LTR) fell 32% on Friday as the lithium miner resumed trading following a trading halt to capital raise after US miner Albemarle walked away from its $6.6bn takeover offer.
What to watch today:
- Ahead of the first trading session of the week here in Australia, the SPI futures are anticipating the ASX to open Monday’s session down just shy of 1%, to carry the sell-off into the new trading week.
- On the commodities front this morning, oil is down 0.33% at US$88.08/barrel, gold is up 0.4% at US$1981/ounce and iron ore is down 2.93% at US$116/tonne.
- AU$1.00 is buying US$0.63, 94.69 Japanese Yen, 51.88 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has slightly decreased the 12-month price target on Lynas Rare Earths (ASX:LYC) from $8.50 to $8.20 and maintain a buy rating on the leading producer of rare earths following the release of the company’s 1QFY24 trading update outlining production of NdPr was 17% lower QoQ and 7% below Bell Potter expectations as maintenance works were carried out at Lynas’ Malaysian facilities over the first quarter.
- And Trading Central has identified a bearish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may fall from the close of $0.66 to the range of $0.57-$0.59 according to standard principles of technical analysis.
All eyes were on key economic data out of China this week. The data will help investors determine the pace of recovery for the world’s second largest economy, and, what that means for local and global markets.
In this week's wrap, Grady covers:
- (0:11) what China’s economic data meant for Australia,
- (0:44) China’s GDP growth rate & industrial production YoY,\
- (1:34) the outlook for commodities,
- (2:43) Cettire (ASX:CTT), Bapcor (ASX:BAP), Nick Scali (ASX:NCK) & Netwealth (ASX:NWL),
- (3:58) quarterly results in the US,
- (4:42) the best performing stocks in the ASX200,
- (5:21) the most traded stocks & ETFs by Bell Direct clients, and
- (5:50) five economic news items to watch out for.
Wall St has closed lower on Thursday as the 10-year treasury yield nears 5%. The Dow Jones lowered 0.75%, the S&P 500 fell 0.85% and the tech-heavy Nasdaq ended Thursday nearly 1 percent lower.
Federal Reserve Chair, Jerome Powell described US inflation as “too high” and would likely require lower economic growth. As a result, investors have taken away that it is likely that the Fed would likely maintain interest rates at its next policy meeting.
The US 10-year treasury yield reached a peak of 4.996%, closing in on a 5% mark that hasn’t been hit since 2007.
Over in Europe, markets closed lower for a third consecutive day as investors react to the Hamas-Israel war, earnings and economic data. The STOXX600 ended Thursday down 1.16%, it’s lowest close since March 15. Germany’s Dax and French CAC closed 0.33% and 0.64% lower respectively, whilst over in the UK, the FTSE 100 ended the day 1.17% in the red.
Locally yesterday, the ASX 200 ended the day down 1.36% with all sectors finishing in the red. This was led by the information technology and consumer staples sectors which saw a 1.84% and 1.63% close in the red.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.64% at the open this morning.
- In terms of economic data,
- The Australian jobless rate was released yesterday, which saw it fall to 3.6%, a sign showing that the labour market remains tight.
- On the commodities front this morning,
- Oil is up 2.23% to 90 US dollars and 30 cents a barrel as concerns in the Middle East ramp up supply issues to major distributors.
- Gold is up 1.37% to 1974 US dollars an ounce as the escalation in the Middle Eastern war increases the demand for the precious metal as a safe-haven asset.
- And iron ore is down 2.05% to 119 US dollars and 50 cents a tonne, despite Rio Tinto signalling that it will attempt to increase iron ore mining to satisfy the demand growth in China.
Trading Ideas:
- Bell Potter maintains a buy rating on Telix Pharmaceuticals (ASX:TLX) and has maintained its price target of $14 with a current share price of $9.20. The buy rating is maintained as revenues are ahead of the forecast and reported revenues in the third quarter representing an 11% sequential quarter increase.
- And Trading Central has identified a bullish signal on Evolution Mining (ASX:EVN), indicating that the stock price may rise from the close of $3.60 to the range of $4.10-$4.20 over a pattern formed in 5 days according to the standard principles of technical analysis.
Over in the US on Tuesday, Wall Street closed mixed after a volatile session as rising bond yields and corporate earnings results weigh on investor sentiment. The S&P500 closed just 0.01% lower after trading down all session, while the tech-heavy Nasdaq lost 0.25% and the Dow Jones rose just 0.04%. The 10-year US Treasury yield topped 4.8% following US retail sales data coming in at a rise of 0.8% which was higher than expected, indicating consumers are still spending in the high interest rate environment. The Bank of America shares rose 2.4% on Tuesday after posting better-than-expected results while Nvidia fell 4.7% after the US Department of Commerce said it plans to ban the export of more AI chips to China.
In Europe on Tuesday, markets closed mostly flat following the release of hotter-than-expected US retail sales data which reignited fears of further monetary tightening out of the world’s largest economy and subsequent flow-on impacts into the European region. The STOXX600 fell 0.1%, Germany’s DAX rose just 0.09%, the French CAC added 0.11% and, in the UK, the FTSE100 climbed 0.58%.
A morning rally locally was dampened in afternoon trade leading to the ASX200 close Tuesday’s session up 0.42% led by a rebound in technology stocks which started the week in negative territory. Healthcare stocks took the biggest hit yesterday with the sector closing down 0.8% while consumer staples and consumer discretionary stocks also closed the day in the red. The tech-rally was driven by strength on the Nasdaq in the US overnight.
The release of the RBA’s latest minutes sparked the sell-off in afternoon trade that saw the strong gains on the local index ease as investors took the minutes as more hawkish than previous months. The consensus of the minutes was focused on the RBA having considered raising the cash rate by 25-basis points at the last meeting before ultimately deciding to leave the rate at 4.1% for a fourth consecutive month.
What to watch today:
- Ahead of the midweek local trading session here in Australia, the SPI futures are expecting the ASX to open 0.28% higher.
- On the commodities front this morning, the volatility in the price of oil has continued over the last few sessions amid hopes of a short-period of war between Hamas and Israel pulling against fears of a prolonged and widespread war that escalates to involve major oil producer, Iran. The rising price of oil fuelled Shell shares to hit a record high as investors price in disruption that could impact global oil supply. The price of oil is currently trading down 0.29% at US$86.42/barrel, gold is up 0.06% at US$1920.57/ounce and iron ore is up 0.84% at US$120.50/tonne.
- Looking at economic data, key Chinese economic data is out today in the form of GDP growth rate data for Q3, industrial production for September and Retail sales data, all of which will give an insight into how the world’s second largest economy is recovering post pandemic and whether further government stimulus is required to reignite growth in the region.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Janison Education (ASX:JAN) from 65cps to 55cps and maintain a buy rating on the global education technology company following the release of a soft Q1 FY24 update including revenue up 5% YoY while ICAS revenue fell 0.6% YoY impacted by economic headwinds and discontinued unprofitable exams. The company also announced that CEO and Managing Director, David Caspari and Chairman, Michael Hill, will step down.
- And Trading Central has identified a bullish signal on BHP Group (ASX:BHP) following the formation of a pattern over a period of 95-days which is roughly the same amount of time the share price may rise from the close of $45.57 to the range of $49.50 - $50.40 according to standard principles of technical analysis.
Wall St rallied overnight following the release of positive corporate earnings despite rising treasury yields. The Dow Jones rose 0.93%, the S&P closed 1.06% higher and the tech-heavy-Nasdaq ended Monday 1.20% in the green.
In terms of US stocks, Nike and Travelers Companies lead the way, up 2.1%, with all 11 sectors in the S&P 500 trading higher.
Earnings season is ramping up with Johnson & Johnson, Bank of America, Netflix and Tesla all set to release results this week. Charles Schwab closed 4.7% higher overnight after exceeding expectations for earnings per share in the third quarter. This followed with JPMorgan Chase, Wells Fargo and United Health all posting positive quarterly results.
Over in Europe, markets ended Monday in the green as investors react to the escalating war in the Middle East. The STOXX600 rose by 0.2%, led by retail stocks which gained 2%. Germany’s DAX and the French CAC rose by 0.34% and 0.27% respectively with the UK’s FTSE100 also jumping 0.41% overnight.
Locally yesterday, the ASX 200 closed 0.35% lower with eight out of the eleven sectors finishing lower, led by losses in the information technology sector of 2.79%. However, this was slightly offset by the energy sector which saw a 0.63% increase on Monday.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.68% at the open this morning.
- In terms of economic data today, the RBA meeting minutes will be released today, following the decision to leave the cash rate unchanged at 4.1%.
- On the commodity front this morning,
- Oil is down 0.79% to 87 US dollars a barrel as traders continue to look at the Hamas-Israel war and the effect it will have on global oil supply.
- Gold is down 1% to 1912 US dollars an ounce, as once again investors await on the impacts the Middle East war will have on the global company which may have adverse effects on the precious metal.
- And iron ore up 2.58% to 119 US dollars and 50 cents a tonne with Beijing announcing that it is considering raising its budget deficit this year to deliver a fresh round of stimulus for new infrastructure projects.
Trading Ideas:
- Trading Central has identified a bearish signal in Johns Lyng Group (ASX:JLG), indicating that the stock price may fall from the close $6.22 to the range of $5.60-$5.70, over a pattern formed in 34 days, according to the standard principles of technical analysis.
- And Trading Central identified a bullish signal on Perseus Mining (ASX:PRU), indicating that the stock price may rise from the close of $1.65 to the range of $1.94 to $2.00, over a pattern formed over 20 days, according to the standard principles of technical analysis.
Wall Street closed mixed on Friday amid a spike in the price of oil and renewed inflation fears which led to the Dow Jones rising 0.12% while the S&P500 fell 0.5% and the Nasdaq lost 1.23%. For the week, the S&P500 added 0.45%, and the Dow Jones rose 0.79%, but the tech-heavy Nasdaq fell 0.18% over the four trading days.
Escalating geopolitical tensions in the Middle East caused the price of oil to jump 6%, the most in one session since April.
Dollar General shares popped 8.8% on Friday after the discount retailer announced former CEO Todd Vasos would return to lead the company while chipmaker and AI shares including Adobe and Nvidia shares rallied to end the week higher. The release of key consumer sentiment data also weighed on Wall St on Friday with the reading showing investor sentiment plunged in October while inflation fears spiked. Third quarter earnings are also in focus over the next week as investors will assess how corporations are faring the high interest rate environment. JPMorgan Chase and Wells Fargo kicked off the earnings period with stronger-than-expected profit and revenue for the third quarter.
Over in Europe, markets closed lower on Friday amid global investor sentiment sliding especially on the back of rising geopolitical tensions between Hamas and Israel. The STOXX600 fell 1% weighed down by tech stocks dropping 2.5%. Germany’s DAX shed 1.55% on Friday, the French CAC fell 1.42%, and in the UK, the FTSE100 lost 0.6%.
Locally on Friday, the ASX200 fell just over half a percent, weighed down by a sell-off in technology and real estate stocks, which are both sectors impacted by higher interest rates which is the general consensus at the moment among investors through the sentiment of higher for longer. Chalice Mining fell a further 8.3% on Friday while Weebit Nano and Core Lithium fell over 6% each. Bega Cheese rallied over 3% though after Bell Potter upgraded the dairy maker to a buy rating with a price target of $3.35/share.
What to watch today:
- Ahead of the new trading session here in Australia, the SPI futures are expecting the local market to open the new trading session down 0.42% to start the new trading week lower.
- On the commodities front this morning oil is up 5.99% at US$87.87/barrel, gold is up 3.42% at US$1932.50/ounce and iron ore is up 1.74% at US$117/tonne.
- AU$1.00 is buying US$0.63, 94.13 Japanese Yen, 52.06 British Pence and NZ$1.06.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Coventry Group (ASX:CYG) from $1.35 to $1.40 and maintain a buy rating on the company following the release of the multi-disciplinary industrial supply and services company’s 1QFY24 trading update indicating Coventry is on track for a very strong FY24. Group sales for the first quarter were up mid-single digits to $94.6m while unaudited pre-AASB-16 EBITDA came in at $5.4m, up 11% on the PCP.
- And Trading Central has identified a bearish signal on Ingenia Communities Group (ASX:INA) following the formation of a pattern over a period of 59-days which is roughly the same amount of time the share price may fall from the close of $3.96 to the range of $3.45 to $3.55 according to standard principles of technical analysis.
The global market rally was driven by the price of oil surging 5% on concerns of a prolonged war between Hamas and Israel. While no immediate impact was felt on the oil supply and demand front, global economies are factoring in prolonged periods of geopolitical tensions which caused the price of oil to surge.
Locally, we are seeing the release of first quarter FY24 trading updates, which had investors making some moves this week.
In this week's wrap, Grady covers:
- (0:34) companies that were sharply sold off,
- (1:06) the Israel-Hamas war’s effect on oil flows and output,
- (1:57) China’s material stimulus package,
- (2:43) Air New Zealand (ASX:AIZ), Redbubble (ASX:RBL), and Tabcorp (ASX:TAH),
- (4:54) the best performing stocks in the ASX200,
- (5:57) the most traded stocks & ETFs by Bell Direct clients, and
- (6:29) five economic news items to watch out for.
US markets closed lower overnight, following the release of key inflation data with core inflation year on year declining to 4.1% in September as markets were expecting. The monthly inflation rate for September fell from a 0.6% rise in August to a 0.4% rise in September which was slightly above what markets were expecting at 0.3% which has reignited fears of further interest rate hikes. The S&P 500 and tech-heavy-Nasdaq closed just over 0.6% lower with the Dow Jones also losing half a percent on Thursday.
US treasury yields rose off the back of released inflation data to 4.70% after hitting its highest peak in 16 years earlier this month.
In terms of US stocks, Walgreens jumped 7% following progress in its cost-cutting plans and lower levels of losses. A potential restriction in oil supply could be on the cards with the ongoing Israel-Hamas war, with geopolitical tension and instability spreading to oil producers in the US.
Over in Europe, markets closed slightly higher on Thursday as they build on positive global momentum this week. The STOXX600 ended the day up 0.1% with oil and gas stocks rising 1.3% each. Travel and leisure stocks were on the losing end, dropping 0.9% as a number of airlines have decided to suspend flights to Israel. The UK’s FTSE 100 ended the day in the green by 0.32%, whilst Germany’s DAX and the French CAC closed 0.23% and 0.37% lower respectively.
Locally yesterday, the ASX 200 closed Thursday 0.04% higher driven by rallies among the financial and real estate sectors which each jumped 0.86%. This was heavily offset by the health sector which closed 4.52% in the red yesterday due to healthcare giant CSL tumbling 6.30%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.81% at the open this morning.
- In terms of commodities,
- Oil is trading 0.16% lower at 83 US dollars and 35 cents a barrel after the oil market showed a rebound as Russia and Saudi Arabia showed they were working together to help support the oil market following the events in Israel and Gaza.
- Gold is trading 0.26% lower at 1868 US dollars an ounce as high interest rates increase the opportunity cost of holding the precious metal.
- And iron ore is up 1.32% to 115 US dollars a tonne as China are still facing financial instability issues in their construction industry.
Trading Ideas:
- Bell Potter maintains a buy rating on Bega Cheese (ASX:BGA), despite decreasing its price target from $3.50 to $3.35 with a current share price of $2.80. The recommendation has changed from a hold to a buy as the risk and reward profile has shifted due to the material valuation upside, should BGA execute on its 5-year targets.
- And Trading Central has identified a bullish signal on Data3 Limited (ASX:DTL), indicating that the stock price may rise from the close of $7.29 to the range of $7.60-$7.70 over a pattern formed in 21 days, according to the standard principles of technical analysis.
US equities closed higher again on Wednesday as Treasury yields continued to decline, and investors await the release of the latest inflation data out on Thursday US time. The Dow Jones industrials index rose 0.19%, the S&P500 added 0.43% and the tech-heavy Nasdaq rose 0.71%. The latest slate of US inflation data will be released on Thursday with economists expecting a rise of 0.3% on the previous month and 3.6% annually. Producer price index in the US rose 0.5% for September which was higher than economists were expecting but a decline from the 0.7% rise reported in August. The latest FOMC meeting minutes also eased investor sentiment on Wall St overnight with signals that just one more interest rate hike may be needed in this monetary tightening cycle to ensure inflation remains under control in a downward trend toward the target 2% reading.
Over in Europe, markets closed mixed on Wednesday, a day after the markets reported the best session in 11-months. The STOXX600 added 0.2% on Wednesday driven by food and beverage stocks while retail stocks fell 2.1%. Germany’s DAX rose 0.24% on Wednesday, while the French CAC fell 0.44% and, in the UK, the FTSE100 lost 0.11%.
Shares in luxury brands retailer LVMH group fell over 6% after reporting a slowdown in growth.
Locally yesterday, the ASX200 rose just shy of 0.7% led by the tech sector jumping 1.7% while consumer discretionary and industrials stocks added 1.23% and 1.12% respectively. All 11 sectors closed the midweek session higher for a second consecutive session. Talks of a Chinese stimulus package worth at least 1 trillion yuan for spending on infrastructure to further stimulate the economic recovery in the world’s second largest economy. These reports boosted local miners’ yesterday amid the outlook for higher demand of Australian produced commodities, especially iron ore.
Qantas shares rallied almost 2% on Wednesday after chairman Richard Goyder agreed to leave the embattled airline’s board next year, while Telstra shares came under pressure after the telco giant announced plans to buy Versent, a cloud consulting company, for $267.5m in a bid to further its cloud business expansion and digitisation.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open 0.08% higher on Thursday.
- On the commodities front this morning oil is trading 3.12% lower at US$83.29/barrel, gold is up 0.76% at US$1874/ounce and iron ore is down 1.73% at US$113.50/tonne.
- AU$1.00 is buying US$0.64, 95.56 Japanese Yen, 52.24 British Pence and NZ1.06.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Eagers Automotive (ASX:APE) from $15.25 to $15.50 and maintain a hold rating on the leading Australian automotive retailer following the company announcing it has entered into a non-binding agreement to acquire a portfolio of dealerships and key strategic properties located across Melbourne and the Mornington region of Victoria from a group of companies for a total purchase price of $245m comprising $111m in good will, $100m for the properties and $34m of net assets.
- And Trading Central has identified a bullish signal on Terracom (ASX:TER) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may rise from the close of $0.42 to the range of $0.57-$0.61 according to standard principles of technical analysis.
Over in the US on Tuesday, a sharp decline in Treasury yields boosted equities on Wall Street to extend this week’s rally into Tuesday as investors assess the geopolitical and long-term risks of the war in Israel. The Dow Jones rose 0.4%, the S&P500 added 0.6% and the Nasdaq rose 0.7%. Easing oil prices on Tuesday also boosted investor sentiment after the price of the commodity rose 5% on Monday on concerns of the long-term effect of the war in Israel. Investors in the US are also looking ahead with optimism at the release of third-quarter earnings results out later this week.
In Europe on Tuesday, markets reversed Monday’s losses to close higher across the region despite rising tensions in the Middle East. The STOXX600 rose 2% boosted by travel stocks rising 3.9% despite the global uncertainty around travel as airlines cancel flights to Israel, while mining stocks rose 2.9%. Germany’s DAX added 1.95% on Tuesday, the French CAC rose 2.01%, and, in the UK, the FTSE100 lifted 1.82%.
The rally on the ASX extended into a third session on Tuesday with the ASX200 gaining 1.01% to close above 7000 points again at the closing Bell, driven by the utilities sector jumping 4.17% followed by technology stocks climbing just over 3%. All 11 sectors closed Tuesday’s session in the green. The local rally followed a positive night in the US overnight after some Fed Officials suggested the recent surge in long-term treasury yields may reduce the need for the Fed to raise its benchmark interest rate again. Rate sensitive sectors in Australia were the best performers on Tuesday, including tech and REIT stocks.
Origin Energy did most of the heavy lifting in the Utilities sector on Tuesday, closing the session up 5.5% after Australia’s competition watchdog the ACCC approved Brookfield and EIG Partners’ $18.7bn takeover offer for the leading energy wholesaler.
The local market was also boosted yesterday by Westpac Consumer Confidence data showing a rise of 2.9% for October which well exceeded economists’ expectations of a 0.7% decline and NAB Business Confidence Data also released showed a reading of 1 point which was the third straight month of a steady reading and above the -2 points expected by markets.
What to watch locally:
- Ahead of the local session here in Australia the SPI futures are suggesting the ASX will extend its green run into a 4th straight session, by opening the midweek session up 0.49%.
- On the commodities front this morning, oil is trading 0.6% lower at US$85.84/barrel, gold is down just 0.06% at US$1859/ounce and iron ore is flat at US$119.50/tonne.
- AU$1.00 is buying US$0.64, 95.45 Japanese Yen, 52 British Pence and NZ$1.06.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Paradigm Biopharmaceuticals (ASX:PAR) from $2.20 to $1.40 and maintain a speculative buy rating on the Australian-based biotech company following the company releasing a report on the 12-month efficacy data from PARA_OA_008 yesterday. The study continued to show patients on the highest dose continued to show significant reductions in pain along with improvements in function 12-months after dosing. Despite the promising outlook and study results, the stock has been sold off as the sector remains out of favour with investors hence the downgrade to the price target reflecting an increased discount rate in the DCF model and earnings adjustments to FY24/FY25.
- And Trading Central has identified a bullish signal on Sandfire Resources (ASX:SFR) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $6.25 to the range of $6.75-$6.90 according to standard principles of technical analysis.
For a limited time only, we are giving you exclusive access to 3 Bell Potter stock reports each week, delivered straight to your inbox. And as a bonus, you will go in the draw to win a share of 3 million Velocity Frequent Flyer Points. The insights from these reports are something you can’t find with any other online broker and is what we use to provide you with our daily trading ideas and market analysis. Gain extra entries by joining Bell Direct and placing your first trade. This offer is available to investors new to Bell Direct.See offer Terms & Conditions here.
Wall Street closed higher over night as investors assess rising geopolitical tensions caused by the conflict between Hamas and Israel and the potential ramifications for the energy market. Defence and oil related companies rallied on Monday amid investor fears of a prolonged period of war in Israel.
In Europe overnight, markets closed lower as investors in the region also assessed the impact of geopolitical turmoil in the Middle East. The STOXX600 fell 0.3%, weighed down by travel and leisure stocks falling 2.4%, while oil and gas stocks rose 2.9% on the rising price of oil. Germany’s DAX fell 0.67% on Monday, the French CAC lost 0.55% and, in the UK, the FTSE100 closed just 0.03% lower.
The local market opened the new trading week on a positive note with the ASX200 adding 0.23% at the closing bell on Monday buoyed by the energy sector jumping 3.04% as the price of oil rose 4% on geopolitical tensions escalating in the Middle East. The gold miners also rallied yesterday amid a spike in the price of the precious commodity which led to De Grey Mining jumping 8.07% while Capricorn Metals added 5.35%, and Newcrest Mining lifted 4.74%.
Popular Mexican fast food chain Guzman y Gomez is reportedly eyeing an IPO in Australia at the end of next year with two CEOs at the helm according to founder Steven Marks.
Magellan Financials’ share price took a further hit yesterday, with the funds manager closing the day down over 7% as investors continue piling out, on the back of the company’s September trading update indicating a further $4bn in outflows were realised during the month taking total funds under management to $35bn.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open Tuesday’s session 0.43% higher at market open this morning.
- On the commodities front this morning, oil is up 3.91% at 86 US dollars and 4 cents a barrel, gold is up 1.22% at 1854 US dollars an ounce and iron ore is flat at 119 US dollars and 50 cents a tonne.
- Oil price jumped 4% after Hamas invaded Israel over the weekend – at this point there appears to be no direct impact on oil supply and demand however a prolonged war will definitely have some form of impact.
- AU$1.00 is buying US$0.64, 95.05 Japanese Yen, 52.12 British Pence and NZ$1.06.
Trading Ideas:
- Bell Potter maintains a buy rating on Aeris Resources (ASX:AIS) and has increased its price target to 30 cents with a current share price of 18.5 cents. It’s near term outlook remains highly leveraged to increasing copper grades at the Tritton copper mine, where high grade ore sources have commenced production and exploration success is likely to sustain it.
- And Bell Potter maintains a buy rating on Smartpay Holdings (ASX:SMP) despite lowering their price target by 4 cents, with a current share price of $1.53. Their upcoming results should provide for further operating delta with a focus on unit growth and cost maintenance.
Wall Street rallied on Friday despite jobs data soaring past expectations to provide further support of a soft landing in the U.S. as opposed to a recession. The Dow Jones rose 0.87% on Friday while the S&P500 added 1.18%, and the Nasdaq rose 1.6%. The US economy added 366,000 jobs in September, more than double economists’ expectations of 170,000 jobs being added. Wages rose less than expected in September though which is a positive sign for inflation. Yields initially rose after the release of the jobs report however retreated in afternoon trade with the 10-year treasury yield settling at 4.78% on Friday. The US unemployment rate remained unchanged at 3.8% which was slightly higher than economists had forecast.
Over in Europe, markets rallied on Friday following the release of robust jobs data in the U.S. The STOXX600 rose 0.8%, Germany’s DAX rose 1.06%, the French CAC added 0.88% and, in the UK, the FTSE100 rose 0.58%. Shares in electronic giant Philips fell 7% on Friday after the US FDA criticised the Dutch health tech company’s handling of a major product recall, with the FDA claiming they do not believe ‘testing and analysis Philips has shares to date are adequate to fully evaluate the risks posed to users from the recalled devices’.
Locally on Friday, the ASX200 rose 0.41% to shake off some of the week’s heavy losses driven by a strong rally for financial and materials stocks while energy stocks came under pressure amid the falling price of oil.
Magellan Financial tanked 18.5% after the asset manager reported a further $4bn drop in funds under management for September to $35bn.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open 0.83% higher on the back of Wall Street’s rally on Friday.
- On the commodities front this morning, oil has recovered to trade 0.58% higher at US$82.79/barrel, gold is up 0.68% at US$1832/ounce and iron ore is flat at US$119.50/tonne.
- AU$1.00 is buying US$0.64, 94.87 Japanese Yen, 52 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has increased the price target on Polynovo (ASX:PNV) from $2 to $2.05 and maintain a buy rating on the medical device company following the release of a trading update outlining total revenue for July/August of $14.9m with US sales accounting for $10.6m while key new jurisdictions for growth in FY24 include Asia, Canada and Europe. The Biomedical Advanced Research and Development Authority will also provide an additional US$10m in funding for the pivotal trial program of Polynovo’s NovoSorb.
- And Trading Central has identified a bullish signal on Rio Tinto (ASX:RIO) following the formation of a pattern over a period of 30-days which is roughly the same amount of time the share price may rise from the close of $113.19 to the range of $125-$128 according to standard principles of technical analysis.
Don’t forget - for a limited time only, we are giving you exclusive access to 3 Bell Potter stock reports each week, delivered straight to your inbox. And as a bonus, you will go in the draw to win a share of 3 million Velocity Frequent Flyer Points. That's enough Velocity Points for 10 return flights from Sydney to Los Angeles! The insights from these reports are something you can’t find with any other online broker and is what we use to provide you with our daily trading ideas and market analysis. Gain extra entries by joining Bell Direct and placing your first trade.
This offer is available to investors new to Bell Direct here.
See offer terms & conditions here.
We have an exciting announcement. For a limited time only, we are giving you exclusive access to 3 Bell Potter stock reports each week, delivered straight to your inbox. And as a bonus, you will go in the draw to win a share of 3 million Velocity Frequent Flyer Points. The insights from these reports are something you can’t find with any other online broker and is what we use to provide you with our daily trading ideas and market analysis. Gain extra entries by joining Bell Direct and placing your first trade.
This offer is available to investors new to Bell Direct here.
See offer terms & conditions here.
With the prospect of a US government shutdown earlier in the week causing a sell-off on Wall St, and subsequently, global markets, the last-minute stopgap bill passing by Congress slightly eased investor sentiment. The merry-go-round in the US keeps turning.
Also, this week, the RBA held the nation’s cash rate at 4.1% for a fourth straight month.
In this week's wrap, Grady covers:
- (0:09) fears surrounding US government shutdown,
- (1:03) the argument in congress,
- (2:04) the consensus of ‘higher for longer’,
- (3:23) the risk of inflation remaining sticky globally,
- (4:33) the best performing stocks in the ASX200,
- (5:20) the most traded stocks & ETFs by Bell Direct clients, and
- (5:53) five economic news items to watch out for.
Read article transcript here.
Wall St closed lower on Thursday as investors start counting down to the release of key jobs data on Friday. The S&P 500 and the tech-heavy Nasdaq ended the day just over 0.1% lower each whilst the Dow Jones closed flat, only down 0.03%.
Thursday losses were led by the consumer staples sector with beverage company Molson Coors retreating 6.3%, followed by Mondelez International and Clorox declining more than 5% each.
Over in Europe, markets closed higher following a retreat in US treasury yields. The STOXX600 ended its three-day losing streak, finishing 0.3% higher lead by travel stocks which rallied 1.5%. The UK’s FTSE100 closed just over half a percent higher on Thursday, while Germany’s DAX fell 0.20% and the French CAC ended the trading session flat.
Locally yesterday, the Australian market closed 0.51% in the green following strong rallies from the real estate and information technology sectors which finished 2.10% and 1.73% higher respectively. This was slightly offset by the energy sector, which fell 0.89% yesterday.
What to watch today:
- The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.03% at the open this morning.
- On the commodity front this morning,
- Oil is trading 2.08% lower at 82 US dollars and 46 cents a barrel with the four-week average for gasoline demand reaching its lowest point for this time of year since 1998.
- Gold is down slightly by 0.05% to 1820 US dollars an ounce as the US dollar and treasury yields pulled back on weaker-than-expected US job data.
- And iron ore is trading flat at 119 US dollars and 50 cents a tonne following a hampered outlook construction materials in China.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Strike Energy (ASX:STX) and has an unchanged valuation of $0.58 per share with its current price at $0.44 per share. This speculative buy rating is maintained as Strike Energy owns the largest reserves plus contingent resources position in Perth basin and recent market consolidation has highlighted the tightening supply-demand fundamentals in the WA domestic gas market.
- And Trading Central has identified a bullish signal in Helia Group (ASX:HLI), indicating that the stock price may rise from the close of $3.58 to the range of $4.02 to $4.12, on a pattern formed over 18 days according to the standard principles of technical analysis.
Less than a month to go! For a limited time only, we are giving you exclusive access to 3 Bell Potter stock reports each week, delivered straight to your inbox. And as a bonus, you will go in the draw to win a share of 3 million Velocity Frequent Flyer Points. The insights from these reports are something you can’t find with any other online broker and is what we use to provide you with our daily trading ideas and market analysis. Gain extra entries by joining Bell Direct and placing your first trade. This offer is available to investors new to Bell Direct here.
See offer terms & conditions here.
Favourable jobs data and easing treasury yields boosted Wall St to a positive close on Wednesday with the Dow Jones snapping a losing streak by adding 127 points or 0.4%, while the S&P500 rose 0.8% and the tech-heavy Nasdaq lifted 1.3%. US private payrolls data showed the economy added 89,000 private payrolls last month which was well below the forecasted 160,000 in a sign the tight labour market in the US is starting to ease.
Over in Europe, markets closed lower on Wednesday amid dampened global sentiment over rising interest rates and the outlook for inflation to remain stubbornly high.
Locally on Wednesday, the ASX200 extended its red run, closing the session down 0.77% to an 11-month low as financial and communication services stocks weighed on the key index, while the utilities sector was the only sector to close the midweek session higher.
Lithium takeover target Liontown Resources added 1% on Wednesday after Gina Rinehart further increased her stake in the near-term lithium producer, taking her holding to 14.7%
Biotech company Noxopharm soared 85% on Wednesday after announcing its CRO-67 preclinical drug candidate for the treatment of pancreatic cancer has been granted orphan drug designation status by the FDA in the US.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open Thursday’s session 0.45% higher on the back of Wall Street’s recovery overnight.
- On the commodities front this morning oil is down 4.96% at US$84.80/barrel, gold is down just 0.09% at US$1821.10/ounce and iron ore is flat at US$119.50/tonne.
Trading Ideas:
- Bell Potter has initiated coverage of Clinuvel Pharmaceuticals (ASX:CUV) with a buy rating with a 12-month price target of $24/share. Bell Potter sees the company’s distribution of Scenesse, the only approved treatment for patients suffering from a rare inherited disease called EPP, as a strong growth outlet over the coming years, with a 3-year Compound Annual Growth Rate of 34% to $78m in FY23. The company also has diversification beyond Scenesse through conducting a range of pharmaceutical R&D activities and new product launches to diversify its commercial opportunities.
- And Bell Potter has increased the price target on Adacel Technologies (ASX:ADA) from 75cps to 80cps and maintain a buy rating on the leading global provider of simulation and control systems for civil aviation and defence sectors following the company announcing it has been awarded a new contract from the Federal Aviation Administration valued at US$59m over five years. Adacel lost this services contract to a competitor 6-years ago and the new contract award represents the hardware component only and does not include any software so another contract may be forthcoming for the upgrade of the software.
As a reminder, for a limited time only, we are giving you exclusive access to 3 Bell Potter stock reports each week, delivered straight to your inbox. And as a bonus, you will go in the draw to win a share of 3 million Velocity Frequent Flyer Points. The insights from these reports are something you can’t find with any other online broker and is what we use to provide you with our daily trading ideas and market analysis. Gain extra entries by joining Bell Direct and placing your first trade. This offer is available to investors new to Bell Direct here.
In New York on Tuesday, rising treasury yields and unfavourable economic data continued to pressure equities with the Dow Jones closing the session down 1.29% in its worst session since March, while the S&P500 and Nasdaq fell 1.37% and 1.87% respectively. Tuesday’s 1.3% fall for the Dow Jones tipped the key index into the red for 2023, with the index down 0.4% year to date at the closing bell. The 10-year Treasury yield hit 4.787% on Tuesday, reaching its highest level since 2007 as traders assess the possibility of further monetary tightening by the Federal Reserve. Yields spiked and equities fell on Tuesday following the release of the August job openings survey which signalled 9.6 million open roles in the month, which was higher than economists were expecting and indicates the labour market in the US remains tight.
In Europe, markets closed lower on Tuesday as investors digested unfavourable economic data out in the region indicating inflation remains stubbornly high. Italian new car registrations data for September came in at a rise of 22.8% from a rise of 12% in August in a sign consumers are still spending in the region despite rising interest rates. The STOXX600 fell 1.1% on Tuesday while Germany’s DAX lost 1.06%, the French CAC fell 1.01% and, in the UK, the FTSE100 shed 0.54%.
The local market fell again on Tuesday as global markets continue taking lead from the US whereby sentiment is currently dampened by the prospect of a potential government shutdown. The ASX200 closed Tuesday’s session down 1.28% to a near 6-month low with every sector ending the session lower aside from healthcare. Energy stocks took the biggest hit yesterday as the sector closed down 3.7% on the sliding price of oil. Rising bond yields especially in the US also continue to sway investors away from the higher risk equities market in favour of less risky returns through bonds.
The RBA held the nation’s cash rate at 4.1% for a fourth straight month in the October meeting yesterday and the first with Michele Bullock as Governor of the RBA. As with the last few months of holds though, the commentary surrounding the rate pause decision focused on the possible need for further tightening in the future should inflation continue to show signs of remaining high. Australia’s wage price index, consumer price index, housing and rent, energy and producer price index all continue to respectively rise which are the key factors of inflation in Australia while unemployment also remains at 3.7%.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open the midweek session down 0.5%.
- On the commodities front this morning, oil is trading 0.75% higher at US$89.50/barrel, gold is down 0.14% at US$1824/ounce and iron ore is flat at US$119.50/tonne.
- AU$1.00 is buying US$0.63, 93.88 Japanese Yen, 52.42 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Avita Medical (ASX:AVH) from $7.45 to $6.85 and maintain a speculative buy rating on the medical tech company after the FDA issued a ‘Substantive Information Request’ in relation to the pre-market approval supplement application for Avita’s RECELL GO product. The most substantive request relates to additional statistical analysis for cell phenotyping with RECELL GO i.e. how many and what type of cells are available using in a sample prepared with RECELL GO vs the legacy Recell Kit.
- And Trading Central has identified a bullish signal on Beacon Lighting (ASX:BLX) following the formation of a pattern over a period of 78-days which is roughly the same amount of time the share price may rise from the close of $1.90 to the range of $2.40 to $2.55 according to standard principles of technical analysis.
Before we dive into the Morning Bell, we have an exciting announcement. For a limited time only, we are giving you exclusive access to 3 Bell Potter stock reports each week, delivered straight to your inbox. And as a bonus, you will go in the draw to win a share of 3 million Velocity Frequent Flyer Points. The insights from these reports are something you can’t find with any other online broker and is what we use to provide you with our daily trading ideas and market analysis. Gain extra entries by joining Bell Direct and placing your first trade.This offer is available to investors new to Bell Direct here.
See offer terms & conditions here.
If you’re an existing client, stay tuned as we’ll have a Velocity Frequent Flyer announcement for you soon.
Now into the Morning Bell, Wall St closed mixed as US Congress fractures the thought of a government shutdown. The US government has been dominating news headlines recently after a group of Republicans refused to support funding legislation until government agencies impose stricter border provisions, which has seen the US now facing a government shut down. The tech heavy Nasdaq closed Monday’s session 0.67% higher whilst the S&P 500 traded flat and the Dow Jones closed marginally lower. In terms of US stocks, Discover shares finished Monday up nearly 5% with Nvidia and medical device manufacturer Insulet gaining over 3% yesterday.
Over in Europe, markets closed lower on Monday following the STOXX600 ending it’s worst performing quarter of the year. The UK’s FTSE100 retreated 1.28% with the German DAX and French CAC following suit both closing just over 0.90% lower each.
Locally yesterday, markets closed 0.22% lower with the consumer staples and health sectors leading losses. This was however, offset by a 0.64% rise in the utilities sector.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 1.36% at the open this morning.
- In terms of economic data, the RBA will release their interest rate decision today, with economists expecting a hold at 4.1%, the same as September.
- On the commodity front this morning,
- Oil is down 2.5% to 88 US dollars and 51 cents a barrel following concerns about high borrowing costs that were highlighted by optimistic PMI results.
- Gold is down 1.11% to 1827 US dollars an ounce, after higher rates in the US reduces the appeal of the precious metal.
- And iron ore is flat at 119 US dollars and 50 cents following muted construction outlook in China.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Cyclopharm (ASX:CYC) and his increased its price target from $3.25 to $4.25 with a current share price of $2.83. The speculative buy rating is based off the expectation that there will be strong revenue growth off a modest base over the next three years.
- And Trading Central has identified a bearish signal on Transurban Group (ASX:TCL), indicating that the stock price may fall from the close of $12.67 to the range of $11.70-$11.90 on a pattern formed over 6 days, according to the standard principles of technical analysis.
Fears of a government shutdown prompted Wall St to close mostly lower on Friday to end the worst month of 2023 on the NYSE. The Dow Jones fell 0.5%, the S&P500 lost 0.27% and the tech-heavy Nasdaq rose 0.14%. In early trade on Friday’s session, all three key indices were trading higher as investors welcome the latest personal consumption expenditures price index reading of a 0.1% rise in August and up 3.9% annually. Economists were polling a 0.2% rise for August in the data the federal reserve monitors closely as a key reading of inflation. The sell off in afternoon trade was spurred on by investor concerns of a potential government shutdown following the House GOP leaders failing to pass a short-term spending bill on Friday.
Over the month of September, the Dow Jones fell 3.5%, the S&P500 shed 4.9%, and the Nasdaq dropped 5.8%.
Over in Europe, markets closed higher on Friday driven by a rally for technology stocks in the region. The STOXX600 added 0.5% on Friday, Germany’s DAX rose 0.41%, the French CAC added 0.26%, and in the UK, the FTSE100 gained 0.08%. Eurozone inflation data was the driver of the rally in Europe on Friday with the latest reading coming in at 4.3% for September, its lowest level since October 2021.
Despite the positive session on Friday, the markets in Europe reported their worst quarter of 2023.
Locally on Friday the ASX200 rose 0.34% driven by the materials sector adding 1.22% while consumer discretionary stocks rose almost half a percent. Core Lithium was the winning stock of the session, soaring over 19% after the lithium miner released its first full-year profit as a lithium producer with revenue of $50.6m and profit of $10.8m for FY23.
Liontown Resources on the other hand fell 1.3% on Friday after the miner lifted the estimated capital costs on its Kathleen Valley Lithium project to $951m which is a jump from the $895m estimate announced in January.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open the Monday’s session down 0.54% to start the new trading month lower.
- AU$1.00 is buying US$0.64 cents, 96.19 Japanese Yen, 52.46 British Pence and NZ$1.07.
- On the commodities front this morning oil is down 1% at US$90.79/barrel, gold is down 0.88% at US$1848.19/ounce and iron ore is flat at US$119.50/tonne.
Trading Ideas:
- Bell Potter has slightly decreased the 12-month price target on Nufarm (ASX:NUF) from $7.00 to $6.75 and maintain a buy rating on the leading supplier of agricultural chemicals, seeds and treatments globally, following the release of a brief FY23 guidance update. The company has reduced its FY23 EBITDA guidance to $430m-$440m which is below consensus expectations of $451m amid inventory destocking and North America’s late season creating headwinds in H2FY23. A reversal of these trends in FY24 along with growth beyond yield program are likely to see a reasonable rebound in earnings in FY25-FY26.
- And Trading Central has identified a bullish signal on Incitec Pivot (ASX:IPL) following the formation of a pattern over a period of 10-days which is roughly the same amount of time the share price may rise from the close of $3.14 to the range of $3.35 to $3.39 according to standard principles of technical analysis.
Ahead of the RBA’s rate announcement next week, we look at the predicted rate outlook for the remainder of CY23, what this means for companies and most importantly, what the outlook means for your portfolio this festive season.
In this week's wrap, Grady covers:
- (0:12) fears and expectations around the cash rate,
- (0:27) Tuesday’s RBA meeting,
- (1:56) what ‘higher for longer’ means for businesses and individuals,
- (2:29) two companies who excelled in the FY23 reporting season,
- (3:04) interest rate impacts on portfolios and investment decisions,
- (4:46) the best performing stocks in the ASX200,
- (6:12) the most traded stocks & ETFs by Bell Direct clients, and
- (6:27) five economic news items to watch out for.
Wall St finished higher on Thursday, however, is still on track for its worst month of the year. All three major indexes finished in the green with the Dow Jones up 0.35%, the S&P 500 up 0.59% and the tech-heavy-Nasdaq up 0.87%.
The US ten-year treasury hit a 15 year high as data came out on Thursday highlighting the still-resilient labour market with jobless claims coming in lower than expected. In terms of US stocks, the communications services performed strongly with a 2% gain in Meta Platforms, whilst Intel and Cisco Systems rallied 1.6% and 1.3% respectively.
Over in Europe, markets closed higher, snapping a 5-day losing streak following strong performances in mining and banking stocks. The STOXX600 closed 0.36% higher thanks to help from the basic resources sector following a rise in Chinese industrial profits. The German DAX and the French CAC finished Thursday strongly, rallying 0.70% and 0.63%, whilst the UK’s FTSE100 closed marginally higher by 0.11%.
Locally yesterday, the ASX 200 ended Thursday marginally lower by 0.08% with most sectors finishing in the red, including the consumer discretionary sector which lost over 1%. This was offset by the energy sector which saw a 2.96% increase yesterday.
Washington H Soul Pattinson results were released yesterday, leaving investors disappointed despite increasing dividends by over 20%. There could possibly be two contributing factors to this. Investors may have been taking profits from the recent run the share price has been on or it could be from Brickworks releasing results on the same day with underlying profit falling 32% in FY23. Washington H Soul Pattinson is the largest share holder in Brickworks, so the rising costs that impacted Brickworks underlying profits may have caused investor sentiment to slide with both Brickworks and Washington H Soul Pattinson closing Thursday’s session down over 6% each.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.64% at the open this morning.
- In terms of commodities,
- Oil is down 2.07% to 91 US dollars and 74 cents a barrel with official data showing that US crude inventories fell by 2.2 million barrels last week.
- Gold has fallen 0.52% to 1864 US dollars an ounce following a strong US dollar.
- And iron ore is up 1.28% to 119 US dollars a tonne following a drop in supply with steel mills limiting production.
Trading Ideas:
- Bell Potter maintains a buy rating on Nufarm (ASX:NUF), despite lowering the price target from $7 to $6.75 with a current share price of $4.72. The buy rating remains unchanged following predictions of a reasonable rebound in earnings in FY24.
- And Trading Ideas has identified a bearish signal in Hearts and Minds Investments (ASX:HM1), indicating that the stock price may fall from the close $2.30 to the range of $2.17-$2.19 over a pattern formed in 50 days, according to the standard principles of technical analysis.
Inflationary drivers rising sparked a mixed session on Wall Street overnight as the price of oil and bond yields respectively rose which dampened investor sentiment in equities. The Dow Jones fell 0.2%, the S&P500 edged just 0.02% higher and the Nasdaq rallied 0.22% following a turbulent few session for the tech-heavy index. The benchmark on the 10-year treasury yield hit its highest level since 2007, while the 2-year treasury yield also climbed. Energy stocks were naturally the best performers on Wall St overnight amid the price of oil rising 3%. Inflation remains a key concern in the U.S. with volatility in investor sentiment expected to continue over the coming weeks as further economic data is released.
Over in Europe, markets closed at a 6-month low on Wednesday as investor sentiment in the region continues to be dampened by the state of the global economy, rising interest rates and inflationary concerns. The STOXX600 fell 0.2%, Germany’s DAX lost 0.25%, the French CAC shed 0.03%, and in the UK, the FTSE100 fell 0.43%. Oil and gas stocks did most of the heavy lifting in Europe on Wednesday following that uptick in the price of oil which offset some of the losses among other sectors like insurance stocks.
The RBA’s rate decision headache worsened yesterday after Australia’s CPI monthly indicator data, the key inflation reading for the country, came in at an acceleration to 5.2% for the 12-months to August. While this was in line with economists’ expectations, it is an increase from the 4.9% rise in July and provides further support for the RBA to consider raising rates again or maintaining the cash rate at 4.1% for longer to ensure inflation comes down to the target range of 2-3%. The key drivers of the boosted inflation reading for August were housing, transport, food and non-alcoholic beverages, insurance and financial services. When the RBA meets next week to announce the interest rate decision, the market is currently factoring in just an 11% chance of a rate hike.
The market fell in afternoon trade following the release of CPI data, leading to the ASX200 closing the midweek session down 0.11% weighed down by the tech sector falling nearly 1%. Star Entertainment Group tumbled over 9% after the embattled casino operator raised $565m from institutional investors through offering new shares at 60cps.
At the other end of the market, Tamboran Resources rallied 11.5% after announcing the upgrade of its gas resources to 2 trillion cubic feet at its 100%-owned Beetaloo Basin.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open Thursday’s session down 0.18%.
- On the commodities front this morning, oil is trading just shy of 4% higher at US$93.93/barrel amid data showing crude inventories in the US fell by a much bigger-than-expected amount last week, gold is down 1.26% at US$1876.55/ounce, and iron ore is down 1.26% at US$117.50/tonne.
- AU$1.00 is buying US$0.64, 94.92 Japanese Yen, 52.65 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has initiated coverage of COG Financial Services (ASX:COG) with a buy rating and a price target of $1.73. Bell Potter’s analyst sees COG’s recent acquisitions will add 182 broker firms nationally across the car and lifestyle markets for COG and as a result, Bell Potter expects an uplift of $833m in total funding volumes with improved cross-pollination into higher margins parts of the Group.
- And Trading Central has identified a bullish signal on Austal (ASX:ASB) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may rise from the close of $1.82 to the range of $2.29 to $2.39 according to standard principles of technical analysis.
Over on in the US, Wall Street closed lower on Tuesday as the release of home sales and consumer confidence data in the region sparked investor concerns over the state of the US economy. The Dow Jones is fell 1.14% in its worst session since March, the Nasdaq retreated 1.57% and the S&P500 is lost 1.47% at the closing bell on Tuesday.
August new home sales data missed expectations with homes under contract totalling 675,000 for the month, down 8.7% on July and below economists’ expectations of 695,000 which would have represented a lesser decline from July. The Conference Board’s consumer confidence index fell to 103 points in September, down from 108.7 in August and also below economists’ expectations of 105.5 points. Both of these readings falling short of economists’ expectations and being greater declines than expected indicate the greater impact interest rate hikes are having on the US economy to date.
Over in Europe, markets closed lower for a fourth straight session as negative investor sentiment impacted global stocks. The STOXX600 fell 0.6% on Tuesday weighed down by technology and automaking stocks falling 2% and 1.2% respectively, while Germany’s DAX lost just shy of 1%, the French CAC fell 0.7% and, in the UK, the FTSE100 closed flat. The muted day in the UK follows signs that the Bank of England and European Central Bank will hold rates steady while the Federal Reserve in the US may have another hike in store. Rising bond yields in the region are also weighing on European markets as investors opt for safer returns alternatives to equities in the current market environment.
The ASX fell 0.54% yesterday as interest-rate sensitive sectors weighed on the key index with the REIT and Tech sectors shedding 1.35% and 1.93% respectively as the market prepares for interest rates to remain higher for longer across not only locally, but among international economies too. Rising bond yields are also weighing on the ASX as investors turn to bonds over the higher-risk equities in the current environment.
Pro Medicus popped 9% on Tuesday after the leading health imaging company announced its wholly owned US subsidiary, Visage Imaging, has signed a $140m, 10-year contract with the largest not-for-profit healthcare system in Texas, Baylor Scott & White Health (BSWH).
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open 0.34% lower following the slide in global investor sentiment overnight.
- On the commodities front, oil is trading 1.07% higher at US$90.64/barrel, gold is down 0.83% at US$1899/ounce and iron ore is down 3.64% at US$119/tonne.
- AU$1.00 is buying US$0.64, 95.29 Japanese Yen, 52.73 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has raised the price target on Pro Medicus (ASX:PME) from $70/share to $75/share and maintain a hold rating on the leading health imaging IT provider after the company announced the signing of its largest ever deal in the US through a 10-year contract with Baylor Scott & White Health. With a shortage of radiologists and ongoing cuts to Medicare re-imbursement for radiology, companies like Pro Medicus are also expected to continue working with AI providers and researchers to facilitate the provision of AI tools in radiology, however the company is not developing its own applications as understood by Bell Potter.
- And Trading Central has identified a bearish signal on Charter Hall Long WALE REIT (ASX:CLW) following the formation of a pattern over a period of 40-days which is roughly the same amount of time the share price may fall from the close of $3.28 to the range of $2.50 to $2.65 according to standard principles of technical analysis.
Wall St closed higher on Monday, ending a 4-day losing streak, with all three major indexes ending the day in the green. The S&P 500 and the tech heavy Nasdaq both finished nearly half a percent higher, whilst the Dow Jones finished marginally higher by 0.13%.
JP Morgan upgraded chemical company Dow which saw it rise 1.7% with Amazon shares also increasing by 1% following an announcement of an investment of $4 billion in artificial intelligence firm Anthropic. Generally speaking, US stocks have struggled in September as the Federal Reserve signaled that higher interest rates are there to stay, therefore sending bond yields higher.
Over in Europe, markets finished lower on Monday following a number of Central Bank rate decisions at the end of last week and the potential of higher interest rates over a long period of time. The STOXX600 ended Monday down 0.6% with nearly all sectors finishing in the red. Travel and leisure stocks led losses by 3%, followed by household goods which lost 2% on Monday. The FTSE 100 ended 0.78% lower, whilst the German DAX and French CAC both closed nearly 1% lower to end the day.
Locally yesterday, the ASX 200 ended the day 0.11% higher led by advances in both the information technology and the communications services sectors up 1.92% and 1.19% respectively. This was slightly offset by the materials sector which retreated 0.73%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.10% at the open this morning.
- In terms of commodities,
- Oil is down 0.20% to 89 US dollars and 85 cents a barrel, as the oil rally stalled last week, following the Federal Reserve’s decision to maintain rates.
- Gold is down 0.49% to 1915 US dollars an ounce as a strong dollar has a negative effect on the appeal of the metal resource.
- And iron ore is up 1.65% to 123 US dollars and 50 cents a tonne, following an increase in production in steel mills in the short run to undercut potential output cuts from the Chinese government.
Trading Ideas:
- Bell Potter maintains a buy rating on Technology One (ASX:TNE) and has increased its price target by 25 cents to $17.75 with a current share price of $15.26. This recommendation has been upgraded from a hold to a buy as the FY23 results coming out on the 21st of November are expected to be modestly above the guidance and consensus.
- And Trading Central has identified a bullish signal in Baby Bunting Group (ASX:BBN), indicating that the stock price may rise from the close of $2.17 to the range of $2.60-$2.70 on a pattern formed over 30 days, according to the standard principles of technical analysis.
It was a turbulent session on Friday and week last week on Wall Street as investors digested signals that the Fed intends to continue raising interest rates for longer despite holding the U.S. cash rate at 5.25-5.5% at the September meeting. The Dow Jones fell 0.31% on Friday while the S&P500 and Nasdaq lost 0.23% and 0.09% respectively, marking a fourth consecutive day of losses on Wall St.
Bond yields also surged on Friday after the central bank forecasted one more rate hike for 2023, which further depleted the attractiveness of equities compared to bonds in the eye of investors.
Website building software company Squarespace rallied 5% on Friday after UBS initiated coverage of the company with a buy rating, while book and media publishing company Scholastic plummeted over 14% on missing earnings expectations on the top and bottom lines.
Over in Europe, investor sentiment in the region was dampened on Friday by signals of further rate hikes out of the Fed in the U.S. The STOXX600 fell 0.3% on Friday taking the week’s losses to 1.57%, while Germany’s DAX fell 0.09%, the French CAC lost 0.4% and, in the UK, the FTSE100 rose just 0.07% to close out the week. Higher for longer interest rates is also a fear of European investors from the ECB.
On Thursday last week, both the Swiss National Bank and the Bank of England ended their respective rate runs but said there is no room for complacency and will raise again if required.
Locally on Friday, the ASX rose just 0.05% to close the final trading session of the week in the green after a dull few days of trading. Real Estate stocks were the worst performers on Friday while the utilities and energy sectors led the gains on the market. Costa Group rose 6.5% on Friday after the agricultural company entered into a Scheme Implementation Agreement with a consortium led by PSP to acquire the remaining shares in Costa Group that the consortium does not already own at $3.20ps.
What to watch today:
- Ahead of the local trading session here in Australia the SPI future are anticipating the ASX to open the new trading week down 0.34%.
- On the commodities front this morning oil is trading 0.46% higher at US$90.44/barrel, gold is up 0.04% at US$1926/ounce and iron ore is up 1.65% at US$123.50/tonne.
- AU$1.00 is buying US$0.64, 95.55 Japanese Yen, 52.52 British Pence and NZ$1.08.
- Stocks trading ex-dividend today include Sigma Healthcare, Atlas Arteria and Auckland International Airport. If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on Develop Global (ASX:DVP) from $3.80 to $3.70 and maintain a buy rating on the hybrid mining company following the company’s release of an update on its Woodlawn operations. While the Mine Life of 7-years was in line with Bell Potter’s prior estimate and is expected to grow to 9-years, OPEX came in higher than Bell Potter expectations.
- And Trading Central has identified a bearish signal on Goodman Group (ASX:GMG) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may fall from the close of $21.70 to the range of $20.40 to $20.70 according to standard principles of technical analysis.
Wall St fell for the third straight day amid concerns of higher rates which saw the major indexes all in the red on Thursday. The S&P 500 had its worst session since March which saw it drop by 1.64%. The Dow Jones and Nasdaq continued this trend lowering 1.08% and 1.82% respectively.
The US 10-year treasury yield hit its highest level since 2007 as a result of jobless claims data displaying a still strong labour market which may encourage the Federal Reserve to hike rates.
In terms of US stocks this week, tech has seen the biggest losses with Tesla, Alphabet and Nvidia all losing more than 2%.
Over in Europe, markets closed lower following interest rate decisions from the Central Banks in England, Turkey, Sweden, Switzerland and Norway. The STOXX 600 ended Thursday lower by 1.3% with travel and leisure stocks seeing the biggest drop, losing 3.2%. Germany’s DAX and the French CAC both lost well over 1% whilst the FTSE 100 also lost 0.69% by market close.
Locally yesterday, the ASX 200 closed 1.37% lower with all sectors ending down on Thursday. The losses were lead by the energy and financial sectors which both closed 1.96% and 1.76% lower respectively.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 1.36% at the open this morning.
- In terms of commodities,
- Oil is steady at 89 US dollars and 54 cents a barrel, after increasing off the back of Russia announcing a ban on fuel exports, raising further concerns about tight supplies.
- Gold is down half a percent to 1930 US dollars an ounce after the US Federal Reserve delivered a hawkish pause on the cash rate.
- And iron ore is up by 0.81% to 124 US dollars a tonne with JP Morgan raising target prices for the iron ore sector as China’s infrastructure expansion limited drawbacks from lower property development.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Genetic Signatures (ASX:GSS), despite lowering its price target from $0.95 to $0.90 with a current share price of 51 cents a share. Bell Potter has maintained a speculative buy rating as the company is about to complete a respiratory kit clinical trial as well as launching commercially in the US.
- And Bell Potter also maintains a speculative buy rating on Mesoblast (ASX:MSB) and its price target remains at $0.58 with a current share price of $0.37. Bell Potter upgraded to a speculative buy based on share price movement in FY24.
Well US equities declined overnight after the Federal Reserve announced that it would leave interest rates unchanged but indicated another rate hike later this year and a delayed beginning to the rate cuts in 2024, which was different to previous rate expectations.
All major US benchmarks closed lower, with the Nasdaq down the most, weighed down by Microsoft and Alphabet. And 2-year US Treasury yields climbed to the highest level since 2006, while the 10-year yield reached 4.4%.
What to watch today:
- Following US markets, the SPI futures are suggesting that the Australian share market will open 0.3% lower this morning.
- In commodities,
- Crude oil is trading in the red, coming down from its over ten-month high, reached in the previous session, after the Energy Information Administration showed that US crude inventories fell by more than 2 million barrels last week, in line with expectations.
- Gold is trading flat after the Fed kept the Fed Funds rate steady.
- And iron ore has dropped, easing from the five-month high hit mid-September, as markets weighed on uncertainty from Chinese property developers.
- And stocks going ex-dividend today include Capital Health (ASX:CAJ), Genesis Energy (ASX:GNE), NRW Holdings (ASX:NWH) and Pacific Smiles Group (ASX:PSQ).
Trading Ideas:
- Bell Potter maintains a Buy rating on Life360 (ASX:360) in anticipation of a strong Q3 result and a chance of an upgrade to 2023 guidance. The market leading app for families includes a range of features from communications to driving safety and location sharing. Bell Potter have increased their price target by 5% to $11.00, which is a 28% premium to the share price.
- And Bell Potter also maintains a Speculative Buy rating on Conrad Asia Energy (ASX:CRD). The company is focused on progressing several gas projects located in offshore Indonesia. Bell Potter have lowered their valuation from $2.40 to $2.30, and at the current share price of $1.38, this implies 67% share price growth in a year.
Wall St closed lower on Tuesday as investors look forward to the results of this week’s Federal Reserve policy meeting. All three major benchmarks closed lower on Tuesday with the Dow Jones losing 0.31%, the S&P 500 falling 0.22% and the tech-heavy Nasdaq sliding 0.23%.
In terms of US shares, Disney lost more than 3% following it decision to announce plans to almost double investment on its cruise and parks business. Agricultural manufacturer, Deere also lost nearly 3% after investment bank Evercore ISI downgraded the stock due to agriculture production concerns.
The US Central bank’s meeting started overnight with there being an expectation amongst investors that the Federal Reserve will not raise rates when its decision comes out on Wednesday in the US.
Over in Europe, markets closed marginally lower as European investors await the results of the Federal Reserve meeting over in the US. The STOXX 600 closed slightly lower with retail stocks posting the biggest losses, whilst banks and oil slightly offset this with gains of around 1%. The FTSE 100 and French CAC finished the day marginally higher while the German Dax saw a close in the red of 0.40%.
Locally yesterday, the ASX 200 ended Tuesday 0.47% lower with materials and real estate sector finishing the day in the red. This was slightly offset by the energy sector ending the day 0.21% higher.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.22% at the open this morning.
-
In terms of commodities this morning,
- Oil is down 0.38% to 91 US dollars and 13 cents a barrel following Saudi Arabia and Russia announcing oil supply cuts.
- Gold is down 0.13% to 1930 US dollars and 61 cents an ounce as the Federal Reserve is expected to maintain a hold on interest rates.
- And iron ore is 0.40% lower to 125 US dollars a tonne amid expectations of stronger demand coming from China.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Azure Minerals (ASX:AZS) and maintains it’s valuation of $4.90 with its current share price trading at $2.49. Bell Potter believes that they are well funded to pursue its lithium exploration target with them also starting exploration of areas where some of the highest ranked lithium targets are located.
- And Bell Potter maintains a hold rating on Altium (ASX:ALU) and have increased their price target from $40 to $44, with a current share price of $45.20. Bell Potter believes the stock is trading around fair value for FY24, hence maintaining its hold rating.
Well, a renewed focus on the outlook for interest rates meant that there wasn’t much movement in US equities overnight. Investors are awaiting the Fed’s policy meeting that’s scheduled for tonight in the US, with the market expecting the central bank stays put when it releases its rate decision on Wednesday. Also, on Wednesday in the US, the Fed will release its market forecasts.
Overnight, although we didn’t see much movement, the three major US benchmarks all closed in the green, inching slightly higher by the close.
It was a different story over in Europe however, with markets closing sharply lower to start the trading week. The STOXX 600 declined 1.2%, with all sectors in negative territory, with healthcare, travel and banks falling the most. Germany’s DAX, France’s CAC, and the FTSE 100 all closed in the red.
What to watch today:
- Our local share market is set to open lower this morning, with the SPI futures suggesting a 0.29% drop at the open this morning.
- In economic news, the RBA will release the minutes for its September meeting today. This was the final meeting under Governor Philip Lowe, when the central bank announced an extension of the rate pause for the third month in a row, in line with market consensus. The RBA also stated that inflation had passed its peak, however readings remain high, emphasising that further monetary tightening may be required to bring inflation back to the target range.
- Looking at commodities now,
- Crude oil is trading higher and is hovering at the highest levels in more than ten months, as expectations of a widening market deficit in Q4, following more supply cuts in Saudi Arabia and Russia. There are also hopes of a Chinese demand recovery. So, keep watch of ASX- listed energy producers today.
- Gold is also trading in the green, rising for the third straight session, so keep watch of gold mining stocks as well.
- And iron ore is up 2.5% and has reaches its highest level since March 31st at US$125.50 per tonne, off the back of expectations of stronger demand in China.
Trading Ideas:
- Bell Potter maintains a Buy rating on Vitura Health (ASX:VIT). The company is a market leader in the distribution of medicinal cannabis products in Australia. Bell Potter says that whilst there are an increasing number of smaller distributors entering the space, Vitura holds significant market share and is ideally positioned to capture this industry growth. Their price target is $0.70, and at the current share price of $0.33, this implies 112% share price growth in a year.
- And Bell Potter have initiated coverage of Burgundy Diamond Mines (ASX:BDM). Their key asset is the Ekati Diamond Mine located in Canada’s Norwest Territories, which was developed by BHP in the late 1990s, and was ranked top 10 of global diamond mines by volume. It’s a highly strategic asset in the global luxury goods value chain. Bell Potter’s price target is $0.50 and at BDM’s current share price of $0.18, this implies 170% share price growth in a year.
Wall St closed lower on Friday following a volatile week and ahead of the Federal Reserve’s policy meeting on Thursday. While the tech- heavy Nasdaq lost 1.56%, the Dow Jones was also in the red by 0.83%. Meanwhile, the S&P 500 suffered its 2nd week in a row of losses rounding out Friday with a loss of 1.22%
Within the S&P 500 the information technology sector performed the worst with Adobe shares falling more than 4%, despite recording better-than-expected quarterly results. Recently debuted company Arm Holdings also had its share price lowered by 4.2% following its successful public debut.
European stocks ended the week higher on Friday following the market’s reaction to the European Central Bank’s suggestion that its latest rate hike may be its last. The STOXX600 ended Friday up 0.2% with household goods leading gains, up by 1.4%. The German DAX ended the week 0.56% higher and the FTSE100 and the French CAC followed suit closing 0.50% and 0.96% higher respectively.
Locally on Friday, the ASX200 ended the week 1.29% higher, with the materials sector advancing the most, while the info tech sector also performed strongly, up almost 2%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.56% at the open this morning.
- In terms of economic data this week, the RBA Meeting Minutes will take place on Tuesday. This will give us insight into why the central bank decided to keep the cash rate on hold this month.
- On the commodity front today,
- Oil is trading 0.40% higher at 91 US dollars and 12 cents a barrel amid improving global demand outlook.
- Gold is up 0.72% to 1924 US dollars an ounce following China’s better-than-expected industrial output results and a weaker US dollar.
- And iron ore is up 2.03% to 125 US dollars and 50 cents a tonne following an increase in expectations that Beijing will mandate steel output controls in the near future.
Trading Ideas:
- Bell Potter has initiated coverage on Seven Group Holdings (ASX:SVW) who is a leading Australian diversified operating and investment Group with market leading businesses in Industrial Services. Bell Potter are positive on the near-term outlook for mining production and transitional energy markets and have placed a price target of $33 with the current share price at $29.05.
- And Trading Central has identified a bullish signal in Deterra Royalties (ASX:DRR), indicating that the stock price may rise from the close of $4.85 to the range of $5.30-$5.45 over 36 days, according to the standard principles of technical analysis.
Artificial Intelligence or AI is the phrase and phenomenon of 2023, paving the way for hyper efficiencies, cost-cutting, and overall operational excellence. With recent government assistance, the scale of in-house investing in AI for ASX listed companies is ramping up. Learn about which companies are leading the way.
In this week's wrap, Grady covers:
- (0:11) Australia’s AI landscape
- (1:08) Temple & Webster’s (ASX:TPW) AI investment strategy
- (1:54) WiseTech Global’s (ASX:WTC) acquirement of Shipamax
- (2:24) Coles Group (ASX:COL) experimenting with ChatGPT
- (2:57) AI in the mining sector - (3:56) Investing in AI-themed stocks
- (4:55) Best performing stocks in the ASX200
- (5:50) The most traded stocks & ETFs by Bell Direct clients
- (6:23) Five economic news items to watch out for
Read the article transcript here
Wall St rallied on Thursday, following the revival of Wall Street’s IPO market and favourable results from economic data. The Dow Jones had its best day since August adding 0.96% while the S&P 500 and the Nasdaq both performed strongly, finishing in the green by 0.84% and 0.81% respectively.
Chip design company Arm debuted on the New York Stock Exchange on Thursday which saw shares increasing by 24.7% as investors hope that the biggest tech offering of the year could kickstart a ‘sleepy’ IPO market.
Over in Europe, markets closed higher on Thursday as investors reacted to the European Central Bank’s decision to hike interest rates once again. Interest rates were increased for the 10th consecutive time by the ECB by 25-basis points taking the core rate to 4%.
The STOXX600 finished Thursday’s session, 1.52% higher following the ECB announcement. This was led by the basic resources sector up 4.2% following China’s central bank announcing it would cut the reserve requirement ratio on banks by 25-basis points. The German DAX closed 0.97% higher and the FTSE100 and French CAC ended Thursday in the green, up by 1.95% and 1.19% respectively.
Locally yesterday, the ASX200 finished the day 0.46% in the green, led by materials up by 0.96% and the financial index ending the day 0.69% higher. This was slightly offset by the health index which finished Thursday in the red 0.57%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 1.22% at the open this morning.
- In terms of commodities this morning,
- Oil is up 2.43% to 90 US dollars and 67 cents a barrel, following expectations of a tightening of the global oil market.
- Gold is up 0.23% to 1910 US dollars an ounce following retail sales and producer prices for the US coming back hotter than expected.
- And iron ore is up 1.24% to 122 US dollars a tonne amid bets of robust demand for Chinese steel production in the short term.
Trading Ideas:
- Bell Potter maintains a speculative buy rating on Clarity Pharmaceuticals (ASX:CU6) and have increased the 12-month price target from $1.30 to $1.70 with the current share price at $1.23. The price target has increased as closing cash at June 30th was $65 million, meaning the company will be well funded through FY24.
- And Trading Central has identified a bullish signal in Whitehaven Coal (ASX:WHC), indicating that the stock price may rise form the close of $6.37 to the range of $7.50-$7.80 over a pattern formed over 18 days, according to the standard principles of technical analysis.
Wall Street closed mixed on Wednesday after the highly anticipated inflation reading was released, showing an inflation reading that was hotter than expected. Inflation in the US accelerated for a second straight month to 3.7% in August from 3.2% in July which was above the 3.6% reading markets were expecting. The higher CPI reading was driven by rising energy and fuel costs as well as higher growth in transportation costs. Core inflation which strips out energy and food rose by 0.3% month on month and 4.3% year on year which also slightly exceeded expectations. Investors responded negatively to the rise in core inflation as it provides further support for the Fed to continue raising interest rates. The Nasdaq rose 0.29%, and the S&P500 added 0.12%, while the Dow Jones fell 0.2%. Tech giants including Tesla and Amazon were the key drivers of the rally for the Nasdaq and S&P500 on Wednesday.
Over in Europe, markets closed lower in the region following the hotter-than-expected inflation reading out of the U.S. The STOXX600 fell 0.99% weighed down by retail stocks while Germany’s DAX lost 0.39%, the French CAC fell 0.42% and, in the UK, the FTSE100 closed just 0.02% lower. UK GDP data came in below expectations with a 0.5% contraction for the month of July which is the biggest decline so far this year and reversed the 0.5% growth in June.
Locally yesterday, the ASX rally that started the week on a positive note came to an end with the key index closing 0.73% lower, weighed down by the tech-sector falling 1.56% on the back of weakness in US tech-stocks on Tuesday. Qantas shares fell even further yesterday after the high court upheld a Federal Court ruling that Qantas breached the Fair Work Act at the start of the COVID-19 pandemic by standing down workers and replacing their services with third-party providers to cost cut during in 2020. While the airline has apologised and taken full responsibility, the impact is said to be wide ranging on the flying kangaroo. Coronado Global Resources led the wins on the ASX200 yesterday with the coal miner adding over 3%, while Eagers Automotive was the worst performer, down 4.54% at the closing bell.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the local index to open 0.07% lower on the back of the global sell-off overnight.
- On the commodities front this morning, oil is trading slightly lower at US$88.81/barrel, gold is down 0.22% at US$1908.97/ounce and iron ore is up 0.42% at US$120.50/tonne.
- AU$1.00 is buying US$0.64, 94.61 Japanese Yen, 51.28 British Pence and NZ$1.09.
- Stocks trading ex-dividend today include Ramelius Resources (ASX:RMS), Cleanaway Waste Management (ASX:CWY), Cash Converters International (ASX:CCV), Austal (ASX:ASB), Ingham’s Group (ASX:ING), BBHI, Seven Group Holdings (ASX:SVW), and Spark New Zealand (ASX:SPK). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has decreased the price target on Select Harvests (ASX:SHV) from $5.50 to $5.30 and maintain a buy rating on the almond producer following the release of the company’s crop and market update including Select Harvests reducing its FY23 pricing estimate per kilo due to downward movement in crop pricing linked to the market and quality of crop. FY23 orchard production has been lifted though following a higher recovery in the pollinator crop.
- And Trading Central has identified a bearish signal on Medibank Private (ASX:MPL) following the formation of a pattern over a period of 97-days which is roughly the same amount of time the share price may fall from the close of $3.47 to the range of $3.09 to $3.17 according to standard principles of technical analysis.
Wall Street closed lower on Tuesday, led by the Nasdaq falling 1.04% in its first losing session in three days as Oracle shares plunged 13% on weaker-than-expected quarterly revenue and guidance. The S&P500 fell 0.57% and the Dow Jones fell in afternoon trade to close 0.05% lower after trading higher all day. Chevron shares rallied almost 2% on strength in the price of oil to offset some of the losses for the Dow Jones on Tuesday. Apple shares were also lower in afternoon trade after the tech giant unveiled a new iPhone model this afternoon in US time. Investor attention in the US is focused this week on key inflation data which will be released on Wednesday US time as it will give an indication into how the US economic inflation is faring and provide further support for the Fed to either raise or hold rates at the next FOMC meeting.
In Europe, markets closed mixed across the board on Tuesday ahead of key economic data released later this week. The STOXX600 fell 0.2%, Germany’s DAX fell 0.54%, the French CAC lost 0.35% and, in the UK, the FTSE100 rose 0.41%.
UK average earnings data released overnight showed regular pay excluding bonuses in the UK went up 7.8% YoY in the three months to July, which is the same reading as the prior quarter and the highest regular growth rate since comparable records began in 2001, in a sign inflation remains high in the region.
The local market has rallied across the first two sessions of this week amid a rise in staple and financial stocks over the two trading sessions. On Tuesday, the ASX200 rose 0.20% led by materials stocks lifting 0.9% on a 3% rise in the price of iron ore following better-than-expected economic data out of China in the form of total credit growth climbing in August 2023, marking the first month-on-month acceleration since March.
It was a big day for lithium miners yesterday with some mining giants making key strategic moves that had investors excited. Delta Lithium shares jumped almost 6.5% after Mineral Resources founder and CEO joined Delta Lithium’s board as non-executive chairman, and Mineral Resources increased its shareholding in Delta to 17.4%.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the local market to open the midweek session down 0.29%.
- On the commodities front this morning, oil continues to strengthen, trading up 1.70% at US$88.77/barrel, gold is down just shy of half a percent at US$1913/ounce and iron ore is up 3% at US$120/tonne on the back of that favourable economic data out of China reigniting demand outlook for iron ore from the region.
- AU$1.00 is buying US$0.64, 94.48 Japanese Yen, 51.28 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the rating on EROAD (ASX:ERD) from a hold to a buy whilst lowering the 12-month price target from $1.25 to $0.90 amid forecasting for the NZ$50m capital raising and the subsequent impact to NPAT that is expected by Bell Potter’s analyst. Bell Potter questions the decision to raise equity capital at such a sharp discount to the last close – especially after the EROAD board rejected the non-binding indicative offer of NZ$1.30/share from Brillian APAC, but the Bell’s analyst does recognise the much-strengthened balance sheet which now removes risk of another capital raise in the short term.
- And Trading Central has identified a bearish signal on Boral (ASX:BLD) following the formation of a pattern over a period of 9-days which is roughly the same amount of time the share price may fall from the close of $4.65 to the range of $4.13 to $4.23 according to standard principles of technical analysis.
Wall St opened the week higher as important inflation data is set to be released later in the week. The tech heavy Nasdaq rebounded after recent weakness, closing the day 1.14% higher. Both the S&P 500 and the Dow Jones also finished Monday in the green gaining 0.67% and 0.25% respectively.
Morgan Stanley has upgraded Tesla stock by 10% following ‘significant breakthroughs with its autonomous software.’ Qualcomm shares also rallied 4%, following news that the chipmaker will be supplying Apple 5G modems for smartphones through 2026.
Stronger-than-expected economic data points from last week has investors looking forward to key US inflation data released later this week, with prior worries that the Federal Reserve may raise rates for longer than previously expected.
Over in Europe, markets closed higher as investors await a big week of economic news from around the world. The STOXX600 ended the day up 0.34% as basic resources rose 2.4% following Anglo American and Rio Tinto trading higher following gains in metal prices. Germany’s DAX closed 0.36% higher, the FTSE 100 closed higher by 0.25% and the French CAC finished the day 0.52% in the green.
Locally yesterday, the ASX200 closed the day half a percent higher following strength in the financial and consumer staples sectors. This was slightly offset by the health sector which finished yesterday 0.67% in the red.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.10% at the open this morning.
- In terms of commodities,
- Oil is down 0.38% to 87 US dollars and 17 cents a barrel amid continued concerns over China’s economic recovery.
- Gold is up 0.21% to 1921 US dollars an ounce as investors await important economic data releases later in the week.
- And iron ore is down 0.85% to 116 US dollars and 50 cents a tonne following an increase in supply for production as there is an expectation that Beijing will mandate steel output controls.
Trading Ideas:
- Bell Potter maintains a buy rating on Nufarm (ASX:NUF) and has maintained the 12-month price target of $7.00 with shares in the ag-stock currently trading at $5.14/share. The buy rating remains unchanged following a reversal of destocking trends and growth in the beyond yield program, which is likely to see a rebound in earnings in FY24.
- And Trading Central has identified a bullish signal in South32 (ASX:S32), indicating that the stock price may rise from the close of $3.29 according to standard principles of technical analysis.
Equities rose in the US on Friday but recorded a losing week across the key indices as investor fears of further rate hikes out of the Fed strengthened on the back of weaker-than-expected initial jobless claims data released earlier last week. The Nasdaq and S&P500 both posted their first weekly losses in 3 weeks losing 1.9% and 1.3% respectively while the Dow Jones fell 0.8% over the week. Shares in e-signature company DocuSign fell 3.7% on Friday despite the company posting earnings that topped expectations and strong guidance for the third quarter.
Over in Europe, markets closed slightly higher on Friday as investor sentiment is sliding on renewed inflationary concerns in the U.S., alongside weak Chinese economic data and stronger government bond yields. The STOXX600 rose 0.22% on Friday, Germany’s DAX added 0.14%, the French CAC lifted 0.62%, and in the UK, the FTSE100 rose 0.49%. The rally on Friday was also due in part to the release of final eurozone figures for economic growth showing the economy grew 0.1% in the second quarter which was lower than the 0.3% growth economists were expecting in a sign interest rate hikes are having an impact in cooling the economy.
Locally on Friday, the ASX200 fell 0.2% weighed down by materials and consumer discretionary stocks being sold off while some of the losses were offset by strength in the utilities sector.
For the week, the ASX200 fell 1.67% with every sector closing in the red aside from energy stocks which were boosted by the rising price of oil on the back of output cuts from Russia and Saudi Arabia.
Polynovo led the winning stocks on Friday with the healthcare company adding over 3% while Lake Resources and Pexa each jumped 2.7% and 2.57% respectively. Sayona Mining tumbled 4.55% on Friday despite the lithium miner announcing it reached the major milestone of shipping the first lithium oxide concentrate and generating maiden cash proceeds from its North American Lithium operation in Quebec.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are suggesting the ASX will open 0.06% higher to start the new trading week in the green.
- On the commodities front this morning, oil has retreated to trade 0.52% lower at US$87.05/barrel, gold is flat at US$1919/ounce and iron ore is down 0.85% at US$116.50/tonne.
- AU$1.00 is buying US$0.64, 93.95 Japanese Yen, 51.25 British Pence and NZ$1.08.
- Stocks trading ex-dividend today include Chorus (ASX:CNU), CSL (ASX:CSL), HUB24 (ASX:HUB), Terracom (ASX:TER) and Pepper Money (ASX:PPM). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has decreased the price target on AMA Group (ASX:AMA) from 26cps to 15cps and maintain a buy rating on the leading accident repair group in Australia following the release of the company’s FY23 results including revenue falling slightly below Bell Potter’s forecast at $869.6m. FY24 guidance was reiterated and the company also announced a $55m capital raise.
- And Trading Central has identified a bearish signal on Reece (ASX:REH) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may fall from the close of $19.24 to the range of $17.70 and $18.00 according the standard principles of technical analysis.
With reporting season for August 2023 coming to an end, investors are being paid their dividends. Investors received $36.8 billion last financial year compared to $29 billion this financial year from the largest 100 ASX listed companies which represented a 21.2% reduction. We take a look at the companies that disappointed and those that surprised.
In this week's wrap, Grady covers:
- (0:31) dividend cuts and increases,
- (1:46) why Accent Group (ASX:AX1) remains a key pick for Bell Potter,
- (3:06) Bendigo & Adelaide Bank’s (ASX:BEN) strong dividend yield,
- (4:06) the Pilbara Minerals (ASX:PLS) sell-off,
- (4:47) Wesfarmers’ (ASX:WES) revenue growth,
- (6:46) best performing stocks in the ASX200,
- (7:33) the most traded stocks & ETFs by Bell Direct clients, and
- (8:04) five economic news items to watch out for.
Read the article transcript here.
Wall Street closed lower on Wednesday as investor fears of further rate hikes out of the Federal Reserve, strengthened. The Dow Jones closed Wednesday’s session 0.57% lower, while the S&P 500 and Nasdaq followed suit, ending the day 0.70% and 1.06% lower respectively. Technology stocks have felt the incoming pressure from potential further rate hikes leading to a negative close across the sector for the third straight day. This was highlighted by Apple and Nvidia which fell by more than 3% each with Amgen and Boeing also fell 2% each.
Over in Europe, markets closed lower on Wednesday as investor focus has shifted to the oil market outlook and inflation concerns in Saudi Arabia and Russia as they each extended voluntary oil cuts until the end of 2023. The STOXX 600 ended the day 0.6% lower, led by households’ goods losing 2.2% and the banks dropping by 1.5%. Germany’s DAX ended the day 0.19% lower with the FTSE100 and the French CAC closing down by 0.16% and 0.84%. Saudi Arabia have extended their oil production cuts by 1 million barrels until the end of December with Russia following suit reducing its oil exports by 300,000 barrels.
Locally yesterday, the ASX200 ended the day 0.78% lower driven by a 1.49% decline in the info tech sector and a 1.35% drop in the communications services sector. However, this was slightly offset by a 0.95% rise in the energy sector.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.48% at market open this morning.
- On the commodities front this morning,
- Oil is up by 0.97% to US$87.55 a barrel, following an increase demand after Saudi Arabia and Russia extend supply cuts until the end of 2023.
- Gold is down 0.48% to US$1,916 an ounce after being weighed down by a strong dollar and economic uncertainty.
- And iron ore is up by 0.85% to US$118.50 per tonne following bets of robust demand for Chinese steel production in the short term.
Trading Ideas:
- Bell Potter maintains a buy rating on PointsBet Holdings (ASX:PBH), but has significantly lowered the 12-month price target from $2.10 to $1.08. The reason for the price target decrease is due to the payment of the capital return which will occur on September 22nd and an increase in the number of shares on issue while all other valuation metrics remain the same. Bell Potter believes the value of the business is seen to be too low at $69 million, assuming the payout of 42 cents final distribution and cash of around 11 cents per share hence maintaining the buy rating on the company.
- Trading Central has identified a bullish signal on New Hope Corp (ASX:NHC), indicating that the stock price may rise from the close of $5.95 to the range of $7.40-$7.70 on a pattern formed over 130 days, according to the standard principles of technical analysis.
US stocks closed lower on Tuesday in the first trading session of this holiday-shortened week as the rising price of oil places further pressure on the Federal Reserve on an inflationary front. The S&P500 fell 0.42%, the Dow Jones lost 0.56% and the tech-heavy Nasdaq fell in late trade to close down 0.08% after trading higher all day. Oil prices have been on the rise over the last week after Saudi Arabia extended its 1-million-barrels per day voluntary oil production cuts. US Treasury yields also rose on Tuesday which reduces investor appetite for riskier assets like equities.
Looking at the odds of a recession in the US, Goldman Sachs cut its recession odds to 15% and said it anticipated the Federal Reserve will skip a rate hike at the next FOMC meeting later this month. While this news would normally boost the market, investors weighed this news against September being historically one of the weakest months for equities.
In Europe, markets fell on Tuesday as sentiment around stimulus out of China begins to fade despite favourable economic data released in the region in the form of the Eurozone producer price index showing producer prices were down 7.6% YoY in July, dropping for a 7th consecutive month. Another dampener on Tuesday was the revision for inflation expectations for the next three years rising from 2.3% in June to 2.4% in July, while one-year expectations remain unchanged at 3.4%.
The local market rebounded in afternoon trade yesterday to close the session just 0.06% lower after trading in the red all day. Iron ore miners like BHP and Rio Tinto and the utilities sector weighed on the market while health care and industrials stocks offset some of the heavy losses in afternoon trade. The market also rallied in afternoon trade following the RBA’s rate decision announcement.
The RBA has maintained the nation’s cash rate at 4.1% for the month of September as Philip Lowe handed down the decision at his last meeting as RBA governor. The reason behind the hold was as the board assesses uncertainty around the economic outlook and its bid to establish a more sustainable balance between supply and demand in the economy.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open the midweek session down 0.23% on the back of the global sell-off overnight.
- Australia’s GDP Growth rate data for Q2 is out today with consensus expecting a rise to 0.3% growth for Q2 from 0.2% growth in Q1. Pending the reading we will likely see markets respond accordingly.
- On the commodities front this morning, oil is trading 0.91% higher at US$86.71/barrel, gold is down 0.62% at US$1926/ounce and iron ore is up 0.43% at US$117.50/tonne.
- AU$1.00 is buying 64 US cents, 94.30 Japanese Yen, 50.96 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the price target on BCI Minerals (ASX:BCI) from 32cps to 44cps and now have a speculative risk rating associated to the buy rating on the mining and exploration company amid analysis of BCI’s cost and design review for its Mardie Salt and Potash Projects. The update highlights raised base capital costs of $1.421bn and a delay to the first salt production to 2H 2026 from the prior guidance of 2H 2024, however, the higher costs and delayed timeline are consistent with recent challenges across the industry.
- And Trading Central has identified a bullish signal on Myer (ASX:MYR) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $0.70 to the range of $0.80 to $0.82 according to standard principles of technical analysis.
The US market was closed on Monday for the labour day holiday.
Over in Europe, markets closed lower in the region on Monday with the STOXX600 closing flat, while Germany’s DAX fell 0.1%, the French CAC lost 0.24% and in the UK the FTSE100 lost 0.16%. European Central Bank President Christine Lagarde said it will be critical for central banks to pin their inflation targets at a period where fluctuations in the likes of energy prices and geopolitical activity are factored in, according to Reuters.
Germany’s trade data released on Monday showed a 0.9% month-on-month decline in exports in July while imports rose 1.4%, leading to a decline in Germany’s trade surplus to 15.9 billion euros from 18.7bn euros in June and well below the consensus forecast of a slight dip to 18 billion euros.
Locally, the ASX started the week in positive territory with the key index closing the first trading session of the week up 0.56%, continuing the momentum from last week’s 2.29% rise.
Yesterday, the key index rally was fuelled by materials stocks rising almost 2% amid optimism of further stimulus out of China increasing demand outlook for iron ore. Energy stocks also lifted to start the week in the green as the price of oil trades 6.57% higher over the last week amid fears of possible production cuts from Moscow.
The story of the local session yesterday was lithium miner Liontown Resources receiving an upgraded takeover bid from US chemicals giant, Albermarle, valuing Liontown at $6.6bn. The initial takeover offer of $2.50/share was rejected on the grounds of value however the Liontown board is reportedly considering the revised $3/share offer and has granted Albermarle a ‘limited period of exclusive due diligence’. Following the offer news, Liontown shares traded 9.5% higher around $2.87/share.
On the other end of the market, Sky City tumbled 15% yesterday after the casino and entertainment company revealed its operating licence may be suspended in New Zealand for 10 days by New Zealand’s Department of Internal Affairs for failure to comply with the responsible gaming program.
As we near the end of reporting season, 385 companies have reported with 28.8% beating estimates, 43% meeting estimates and 27.8% missing estimates.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the local index to open 0.26% lower on Tuesday.
- On the commodities front this morning, oil is trading 0.44% higher at US$85.93/barrel, gold is flat at US$1938.56/ounce and iron ore is down 0.43% at US$117/tonne.
- Stocks trading ex-dividend today include Pilbara Minerals (ASX:PLS), Yancoal (ASX:YAL), Northern Star Resources (ASX:NST), Codan Limited (ASX:CDA), Corporate Travel Management (ASX:CTD), Clinuvel Pharmaceuticals Limited (ASX:CUV)and Origin Energy (ASX:ORG).
Trading Ideas:
- Bell Potter has downgraded Liontown Resources (ASX:LTR) to a hold from a buy and maintain a 12-month price target of $3.85 on the lithium miner following the receipt of an upgraded takeover bid from Albermarle of $3/share. Albermarle has declared this is its best and final offer unless a superior proposal is received. The Liontown board has granted Albermarle a limited period of exclusive due diligence and according to Bell Potter, intends to unanimously recommend the proposal in the absence of a superior offer and subject to an independent expert opinion.
- And Trading Central has identified a bullish signal on Coronado Global Resources (ASX:CRN) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $1.66 to the range of $1.76-$1.78 according to standard principles of technical analysis.
Favourable jobs data out in the US boosted investor sentiment on Friday to close out a winning week on Wall Street. The Dow Jones added 0.3% on Friday while the S&P500 rose 0.18% and the Nasdaq fell 0.02%. For the week though the Dow and Nasdaq each added 1.4% and 3.3% respectively while the S&P500 rose 2.5%.
Non-farm payrolls data out in the US on Friday showed the unemployment rate ticked higher to 3.8% in August, well above economists’ expectations of a hold at 3.5%. The rise in unemployment provides further signal that the Fed’s aggressive interest rate hikes are proving effective in cooling the tight labour market.
Following recent favourable data being released, the market has factored in a 93% chance the fed will hold interest rates at the next meeting, according to CNBC.
Dell Technologies soared 21% on Friday after reporting stronger-than-expected earnings in the latest quarterly results update.
Over in Europe, it was a mixed session on Friday as key US data and a lag in automaker stocks weighed on investor sentiment in the region. Auto stocks fell 2.6% on Friday after a survey out of Germany showed a deterioration in sentiment among automakers with almost half saying lack of orders is impeding production. The STOXX600 closed flat, Germany’s DAX fell 0.7%, the French CAC lost 0.27%, and in the UK, the FTSE100 rose 0.34%.
Locally, the ASX200 fell 0.37% on Friday, weighed down by the healthcare sector falling 1.42% while utilities stocks lost just shy of 1%. Qantas shares have been heavily sold off in recent sessions as the national carrier is facing a record corporate penalty of $600m from the consumer watchdog for allegations that Qantas was selling tickets for around 8000 allegedly already cancelled flights in May and June 2022. This comes alongside the airline facing scrutiny for making it difficult for customers to access and use flight credits, of $570m in total value, for flights cancelled during the COVID-19 period.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the local market to open 0.43% higher ahead of a big week on the economic front this week including the RBA interest rate decision tomorrow, GDP Growth Rate data out tomorrow and trade balance out later in the week.
- On the commodities front this morning, oil is trading 0.57% higher at US$86.04/barrel, gold is flat at US$1939/ounce and iron ore is down 0.43% at US$117/tonne.
- AU$1.00 is buying 65 cents, 94.28 Japanese Yen, 51.24 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has downgraded Resimac Group (ASX:RMC) from a Buy to a Hold and slightly decreased the price target from $1.12 to $1.09 on the back of the company releasing mixed FY23 results including home loan book shrinking 14% to $13.1bn while net interest income decreased to $222.5m from $238.1m and Bell Potter’s analyst expects the home loan book to decline 4% in FY24 before returning to growth in FY25.
- And Bell Potter has decreased the price target on XTEK (ASX:XTE) from 80cps to 70cps and maintain a buy rating on the defence manufacturer following the release of the company’s FY23 results that beat both guidance and Bell Potter estimates. The downgrade in price target was due to Bell Potter having lack of visibility over future revenue which is weighing on the share price, however this is not uncommon in the defence industry. Bell Potter is awaiting updates on the referenced multiple large ballistic orders and multi-year new SUAS Support Contract shortly.
As we near the end of Reporting Season, we’ve seen 348 companies report their earnings. 106 have beat expectations, 146 met expectations, while 96 fell short of expectations.
This week, the Australian share market advanced 2.67% this week (Mon – Thurs), in a strong week of trading. All but the energy sector, posted notable gains. The materials sector had the biggest rally, with the sector rising 3.66%, followed by the healthcare sector adding 3.36% and consumer discretionary rising 3.18%.
In this week's wrap, Grady covers:
- (0:51) How City Chic (ASX:CCX) fell out of favour with investors
- (1:53) The positive run for travel stocks, including Flight Centre (ASX:FLT)
- (3:09) What’s causing Brambles’ (ASX:BXB) share price movements
- (4:34) The key takeaways from Reporting Season this week
- (5:30) Best performing stocks in the ASX200
- (6:15) The most traded stocks & ETFs by Bell Direct clients
- (6:45) Five economic news items to watch out for
Read the article transcript here.
US equities closed mixed overnight ahead of the August payrolls report, closing out August with losses for all three benchmarks. The S&P 500 and the Dow Jones closed the session in the red, while the tech-heavy Nasdaq was in the green. For the month of August however, the Nasdaq is down 2.17%, the Dow dropped 2.36% and the S&P500 down 1.77%.
European stocks were also lower, following the release of euro zone inflation data, which remained unchanged from July at 5.3%.
What to watch today:
- The Australian market is set to open lower this morning, with the SPI futures suggesting a drop of 0.52% at the open.
- In commodities,
- Crude oil is trading 2.4% higher, advancing for the sixth straight session and nearing levels last seen in November 2022, driven by expectations of tight supplies. Recent PMI data has also showed that China’s manufacturing sector contracted for the fifth consecutive month, which increases expectations that OPEC+ nations will extend output cuts. So, keep watch of ASX energy producers today.
- Gold is slightly lower, after strengthening above US$1,940 an ounce, following weather-than-anticipated US economic data, as well as a lower US dollar and Treasury yields.
- And iron ore is in the green, remaining close to the one-month higher of US$117.50, as the market bets on stronger demand from steel producers. So, iron ore miners will also be on watch today, including Fortescue Metals (ASX:FMG), Champion Iron (ASX:CIA) or Mineral Resources (ASX:MIN).
- And there is a long list of companies set to go ex-dividend today, which often sees share prices fall, as investors take their profits. Some include Ampol (ASX:ALD), Eagers Automotive (ASX:APE), Coles (ASX:COL) and Gold Road Resources (ASX:GOR).
Trading Ideas:
- Bell Potter maintains a buy rating on PointsBet Holdings (ASX:PBH), after the corporate bookmaker reporting FY23 results in line with Bell Potter’s expectations. They have lowered their valuation of the Australian business from $180 to $150 million due to a reduction in their forecast FY24 EBITDA from $20 to $15 million. This has lowered their 12-month price target by 5% to $2.10. At PBH’s current share price of $1.62, this implies 29.2% share price growth in a year.
- And Trading Central have identified a bearish signal in PM Capital Global Opportunities Fund (ASX:PGF), indicating that the stock price may fall from the close of $1.89 to the range of $1.78 to $1.80 over 25 days, according to the standard principles of technical analysis.
US equities advanced on Wednesday as investors digested the release of fresh economic data. Annual GDP growth in the US was downwardly revised on Wednesday from the previously forecast 2.4% to 2.1% growth. This came alongside US payrolls data showing private employers added 177,000 jobs in August which was below the Dow Jones estimate of 200,000, but adds a further sign of the U.S. economy doing it tough in the high interest rate environment.
The S&P500 advanced 0.38% in its fourth straight winning session, the Nasdaq rose 0.54% and the Dow Jones added 0.11%. Tech stocks bolstered the gains on Wednesday after chipmaker and 2023 market darling Nvidia announced an expansion of its partnership with Google.
Over in Europe, markets closed mostly marginally lower on Wednesday as investors responded to the release of economic data out of Spain and Germany. Spain reported flash inflation rate data rose 2.6% YoY in August which was in line with expectations, while Germany reported a 13.2% drop in imports in the year to July, the sharpest drop since 1987. The STOXX600 fell 0.2%, Germany’s DAX lost 0.24%, the French CAC fell 0.12%, and in the UK, the FTSE100 added 0.12%.
The local market closed 1.21% higher on Wednesday as investor sentiment was boosted by Australia’s CPI indicator data cooling to growth of 4.9% in the 12-months to July. Industrials and healthcare stocks posted the biggest gains on Wednesday, while Real Estate stocks also rose 1.31% on the hopes of fewer or no further interest rate hikes in Australia as inflation continues to cool.
Australia’s monthly Consumer Price Index indicator rose by 4.9% in the year to July from a 5.4% rise in June and below market expectations of a 5.2% rise last month. Although it is still above the RBA’s target range of 2-3%, it is showing strong signs of cooling which provides support for the RBA to ease its rate hike stance.
Plus-size fashion retailer City chic tumbled 4.4% on Wednesday after posting a 17.2% slide in sales over FY23, while Brambles rose 7.1% after the supply chain solutions specialist reported a 10% rise in revenue, a 19% increase in profit after tax and a 15% lift in the company’s dividend to 26.25UScps.
Regional Express REX released FY23 results yesterday which sent the share price down nearly 3% despite the company reporting a statutory profit after tax of $14.4m, compared to a loss of $46.1m in the PCP. The result was boosted by a $44.5m contribution from REX’s 50% acquisition of National Jet Express during the year.
What to watch today:
- Ahead of the local trading session here in Australia the ASX is set to open Thursday’s session up 0.06%.
- On the commodities front this morning oil is up 0.6% at US$81.63/barrel, gold is up 0.36% at US$1944/ounce, and iron ore is flat at US$115.50/tonne.
- AU$1.00 is buying US$0.65, 94.61 Japanese Yen, 50.97 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the rating on Paragon Care (ASX:PGC) from a hold to a buy and maintain a 26 cents per share price target on the healthcare equipment, devices and consumables provider following the release of the company’s FY23 results that included revenue up 24% to $307.6m, EBITDA margin up 12.5% driven mainly by acquisitions, and reported NPAT increased 89% to $13.6m. Revenue from the devices business increased 14% despite headwinds in reimbursements paid by the prosthesis list. Bell Potter upgraded the company to a buy as it expects further organic growth in FY24 and acceleration of growth in FY25.
- And Trading Central has identified a bullish signal on Piedmont Lithium (ASX:PLL) following the formation of a pattern over a period of 30-days which is roughly the same amount of time the share price may rise from the close of $0.69 to the range of $0.91 to $0.97 according to standard principles of technical analysis.
Wall Street closed in the green on Tuesday as investors begin buying into the August dip, especially in the technology space. The tech-heavy Nasdaq rose 1.74% on Tuesday, in its best session since June, while the Dow Jones rose 0.85% and the S&P500 added 1.45%.
Chinese electric vehicle maker Nio fell 5.8% on Tuesday after posting a wider quarterly loss than expected. Best Buy shares rallied nearly 6% on Tuesday after the retailer’s second quarter results beat on both top and bottom lines.
In Europe, markets closed higher on Tuesday amid positive global momentum and as investors look ahead to a fresh round of economic data out later this week. The STOXX600 rose 1% on Tuesday, Germany’s DAX added 0.88%, the French CAC lifted 0.67% and, in the UK, the FTSE100 had the biggest rally of 1.72%.
The local market closed 0.71% higher on Tuesday driven by a 1.6% rally for materials stocks while the consumer discretionary sector rose 1.42%. Healthcare and technology stocks were the only two sectors to close yesterday’s session lower.
Sayona Mining soared over 26% on Tuesday as investors bought back into the lithium producer following a 30% drop on Monday after the shock departure of managing director and CEO, Brett Lynch.
Mineral Resources rose 8% on Tuesday after the mining giant released strong FY23 results including its full year dividends rising 90% on FY22 to $1.90/share. EML Payments also had a very strong day on Tuesday following the release of the payments company’s FY23 results. Despite the company reporting a net loss of $248.8m, revenue rose 9% to a record $254.2m which was above the company’s guidance range.
We are nearing the end of reporting season and as of yesterday, 272 companies have reported with 89 beating expectations, 103 falling in-line with expectations and 80 missing expectations. 38 companies have been upgraded by brokers and 36 have been downgraded. Some key trends we have seen this reporting season include exposure to China is hurting outlook for companies operating in this region, retailers who reduced inventory over the last financial year showed resilience in FY23, and healthcare valuations continue to decline amid slowing earnings growth outlook.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open the midweek session up 0.66% on the back of the US rally overnight.
- On the commodities front this morning, oil is trading 1.26% higher at US$81.13/barrel, gold is up almost 1% at US$1936/ounce and iron ore is down 1.7% at US$115.50/tonne.
- AU$1.00 is buying US$0.65, 94.44 Japanese Yen, 50.97 British Pence and NZ1.09.
Trading Ideas
- Bell Potter has maintained a hold rating on LGI (ASX:LGI) and decreased the 12-month price target from $2.77 to $2.32 per share following the market leader in the recovery of biogas from landfills, FY23 results. While the company reported FY23 results largely in-line with Bell Potter estimates if not slightly ahead, the hold rating is maintained, and price target decreased based on commodity pricing updates and downward revisions to Bell Potter’s forecast biogas volume growth.
- Bell Potter has also maintained a buy rating on Lynas Rare Earths (ASX:LYC) and increased the price target on the rare earths miner from $7.80 to $8.50 following the release of the company’s FY23 results which saw the business deliver NPAT of $310m which exceeded Bell Potter’s expectations of $292m even though Lynas faced production issues in Q1 and the NdPr prices were weaker. Lynas also increased Capex as inflationary and time pressure mounts on the Kalgoorlie project, however the company also announced the installation of 9 thousand tonnes per annum of NdPr equivalent of increased capacity at Kalgoorlie.
Well looking at global markets overnight before jumping into the day ahead. US equities rallied higher, regaining ground in the last week of August, following a month of losses. The Dow Jones and the S&P 500 both gained 0.6%, while the Nasdaq advanced 0.84%, with Meta and Apple trading higher. However, the information technology sector of the S&P 500 is down almost 5% for the month, and all three major benchmarks have lost ground in August.
European shares traded higher, as investors weighed the prospect of higher interest rates from the US Federal Reserve. Markets were closed in the UK for a public holiday. While Germany’s Dax and France’s CAC both advanced over 1%, and the STOXX600 gained 0.9%.
What to watch today:
- The SPI futures are suggesting that our local market will open 0.35% higher this morning.
- In economic news, the RBA’s Deputy Governor Michele Bullock is set to give a speech at 11:30am AEST today.
- And Reporting Season continues, so watch the share price movements of the company’s reporting today, including Cooper Energy (ASX:COE), Mineral Resources (ASX:MIN), Star Entertainment (ASX:SGR) and Tyro Payments (ASX:TYR) and Zip Co (ASX:ZIP).
- Looking at commodities,
- Crude oil is in the green, extending gains for the third straight session, as risk sentiment improves. However, investors are still cautious about the prospect of higher global oil supply and weaker demand.
- Gold continues to advance as investors await US economic data out this week, which will likely guide the interest rate outlook.
- And iron ore continues to jump, currently up a further 1.3% at US$117.50 per tonne, reaching its highest level in a month, amid high hopes for strong demand from steel producers.
- And there are a long list of companies set to go ex-dividend today. Remember this often sees share prices fall, as investors take their profits. A few today include Bega Cheese (ASX:BGA), Insurance Australia Group (ASX:IAG), Lottery Corporation (ASX:TLC) and Worley (ASX:WOR).
Trading Ideas:
- Bell Potter maintains their SELL rating on Fortescue Metals Group (ASX:FMG), after the mining giant reported its FY23 financial result, which was in-line to slightly below Bell Potter’s forecasts on an underlying basis. They’ve lowered their price target by 3% to $15.53 and at FMG’s current share price of $19.87, implying a 22% loss.
- And Trading Central have identified a bullish signal in Helia Group (ASX:HLI), indicating that the stock price may rise form the close of $3.84 to the range of $4.09 to $4.15 over 20 days, according to the standard principles of technical analysis.
Wall Street closed higher on Friday as investors welcomed comments made by Fed Chair Jerome Powell at the Jackson Hole symposium regarding stronger economic growth than expected.
The Nasdaq advanced almost 1% on Friday while the S&P500 rose 0.7% and the Dow Jones also lifted 0.7%.
Over in Europe, markets closed mixed on Friday ahead of the European Central Bank President’s speech at the Jackson Hole Symposium in Wyoming over the weekend. On Friday, the STOXX600 fell 0.04%, Germany’s DAX rose 0.07%, the French CAC added 0.21% and, in the UK, the FTSE100 rose 0.07%.
Locally on Friday, the ASX200 fell 0.93%, weighed down by the tech sector falling 2.51%, while consumer staples and consumer discretionary stocks were the only to sectors to finish the final trading session of the week in the green. Lovisa rose 6.3% on Friday after the fashion jewellery retailer released strong FY23 results including revenue up 30% to $596.5m and net profit lifting 16.7% to $68.2m. While the results fell short of Bell Potter expectations, investors appeared impressed with the company’s report. Wesfarmers also rallied 3.2% on Friday after also releasing strong FY23 results led by a surge in revenue for Kmart and NPAT up 4.8% in FY23 against a slowing consumer spend environment. Another inclusion for Wesfarmers was the announcement of a 6.1% rise in the full year dividend.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Monday’s session up 0.28%.
- On the commodities front this morning, oil is trading 0.57% higher at US$80.29/barrel, gold is down 0.11% at US$1915/ounce and iron ore is up 1.3% at US$117.50/tonne.
- Stocks trading ex-dividend today include Coronado Global Resources (ASX:CRN), Challenger (ASX:CGF), Domino’s Pizza (ASX:DMP), Santos (ASX:STO) and Aurizon (ASX:AZJ). If you’ve been thinking about these stocks, it might be worth considering buying in today, as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- Australian preliminary retail sales data for July is out today with consensus expecting a rise of 0.3% for the month, up from a 0.8% fall in June which if the reading comes in-line with or above expectations, we could see a rally for consumer discretionary stocks today as this will indicate Aussie’s are still spending despite the high cost-of-living environment.
- AU$1.00 is buying US$0.64, 93.84 Japanese Yen, 50.84 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has slightly decreased the price target on Cobram Estate Olives (ASX:CBO) from $1.75 to $1.70 and maintain a buy rating on the specialised olive oil producer and marketer following the release of the company’s FY23 results which came in line with expectations including 31% growth in revenue, and a key highlight was US NPAT of $7.7m which compares to a $0.7m loss in FY22. The outlook provided includes the expectation for sales to remain positive in FY24 both in the US and Australia, sufficient olive oil inventory levels despite lower-than-expected FY23 crop, and US harvest is expected to be materially higher than FY23. The reason for the price target decrease is as Bell Potter does not see the current share price as reflecting the inbuilt value upside of the farming and processing assets, and the inbuilt growth that is likely to emerge in the brand as company owned and third-party oil production lifts.
- And Trading Central has identified a bearish signal on Ingenia Communities Group (ASX:INA) following the formation of a pattern over a period of 59-days which is roughly the same amount of time the share price may fall from the close of $3.97 to the range of $3.25 to $3.40 according to standard principles of technical analysis.
So far this reporting season, 192 companies have reported, with 64 beating expectations, 70 meeting expectations, and 58 falling short of expectations. 29 companies have been upgraded by brokers while 23 have been downgraded. This week, supermarket giants released results with vastly different reactions from investors. The Aussie share market rose 0.48% (Mon-Thu) as a rally on the Nasdaq in the US fuelled a rally for local tech stocks.
The local tech sector rose 2.5% over the four-trading days. In this week's wrap, Grady covers:
- (0:28) Investor reactions to the supermarket giants’ results
- (1:30) Inghams Group (ASX:ING) & Qantas (ASX:QAN) results
- (3:19) China’s impact on the mining sector
- (3:56) Healthcare companies being the brunt of investor sell-off
- (4:42) Key themes this reporting season
- (5:21) Best performing stocks in the ASX200
- (6:06) The most traded stocks & ETFs by Bell Direct clients
- (6:41) Three economic news items to watch out for
Wall St fell sharply on Thursday, despite a tech rally which was led by a stronger than expected results from chipmaker Nvidia. The S&P 500 finished the day 1.35% lower, which was followed by the Dow Jones and the tech heavy Nasdaq losing 1.08% and 1.87% respectively.
Nvidia’s share price reached an all time high after its revenue and earnings significantly exceeded analysts’ expectations. The tech giant has also raised guidance with analysts’ predicting third quarter revenue to climb to $16 billion US dollars.
The S&P500’s information technology sector performed poorly on Thursday, ending the day down 2.15%. Shares of major tech companies such as Amazon and Apple finished lower by 2.7% and 2.6%.
Over in Europe, markets ended lower on Thursday as tech stocks fell by 2.3%. The STOXX600 ended the day 0.4% lower, with the financial services sector slightly offsetting losses, gaining 0.5%. Germany’s DAX closed 0.68% lower while the French CAC also ended the day 0.44% lower. This was slightly offset by the UK’s FTSE 100 which ended 0.18% in the green on Thursday.
Locally yesterday, the ASX 200 closed 0.47% higher on the back of strong results from the info tech sector which finished the day 4.2% higher. This was further supported by the financial sector and energy sector closing the day 1.04% and 0.89% higher respectively. This was offset by the consumer staples sector which closed 1.09% lower on Thursday.
What to watch:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 1.28% at the open this morning.
- On the commodities front this morning,
- Oil is up by 0.1% to 78 US dollars and 96 cents a barrel after deteriorating economic situations in China.
- Gold is up 0.15% higher to 1915 US dollars an ounce as markets have scaled back bets on further tightening from the Federal Reserve.
- And iron ore is up 2.22% to 115 US dollars a tonne after renewed bets of stronger demand form steel producers.
Trading Ideas:
- Bell Potter maintains a buy rating on Alkane Resources (ASX:ALK) and maintain a price target of $1.05 on the company after Alkane’s underlying NPAT grew 19% to $42.1m on 5% growth in gold production. Bell Potter’s analyst says that with upside of 57.9% from the closing share price, the buy rating is maintained in accordance to the rating structure.
- And Trading Central has identified a bullish signal in Tabcorp Holdings (ASX:TAH), following the formation of a pattern formed over 20 days, which is roughly the same amount of time the share price may rise form the close of $1.09 to the range of $1.13-$1.15, according to the standard principles of technical analysis.
A decline in bond yields paired with anticipation for the release of Nvidia’s quarterly results, fuelled Wall Street to close in positive territory overnight. The Nasdaq extended its rally into a third straight session, adding 1.6%, while the Dow Jones rose 0.5%, and the S&P500 gained 1.1%.
After the closing bell Nvidia, the chip making stock leading the AI hype in 2023, reported quarterly earnings including record revenue up 88% in Q2 from Q1 to US$13.51bn, and record data centre revenue up 141% on Q1 to US$10.32bn. Net income popped from US$656m in the three months ended July 31st, 2022, to US$6.188bn in the three months ended July 30th, 2023.
The benchmark ten-year treasury yield that hit its highest level since 2007 on Monday, dipped more than 11 basis points overnight to 4.21% which increased investor appetite for equities.
Inflationary pressures and expected cooling consumer demand are weighing on apparel giants like Nike as the sports brand fell for a 10th straight session on Wednesday, while Footlocker tumbled 28% after reporting a decline in sales and lowering its forecast for the second time this year.
Over in Europe markets closed marginally higher across the region on Wednesday led by a jump in utilities stocks adding 1.1%. Germany’s PMI figures were released overnight showing a steep downturn in manufacturing output alongside a plunge in business activity. The STOXX600 rose 0.4%, Germany’s DAX added 0.15%, the French CAC lifted 0.08%, and in the UK, the FTSE100 rose 0.68%.
Locally yesterday, the ASX closed 0.38% higher as strong gains for consumer staples, materials and consumer discretionary stocks offset the tech sector’s near 5.3% decline. The reason for the tech sector slide was on the back of WiseTech Global tumbling 20% on weaker-than-expected guidance for FY24 and a return to acquisition growth strategy which will squeeze profit margins.
What to watch today:
- Ahead of the new local trading session today, the SPI futures are expecting the ASX to open 0.51% higher on the back of Wall St rallying overnight.
- On the commodities front this morning, oil is trading 1.24% lower at US$78.65/barrel, gold is up 1.03% at US$1917/ounce, and iron ore is up 3.21% at US$112.50/tonne.
- AU$1.00 is buying US$0.65, 93.87 Japanese Yen, 50.33 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on Cedar Woods Properties (ASX:CWP) from a buy rating to a hold rating and have slightly increased the price target on the company from $5.20 to $5.30 following the release of the company’s full year FY23 results. For the year, Cedar Woods reported turnover increased to $391m which was stronger than expected due to higher settlements falling in June, a slight decrease in the full year dividend to 20cps from 26cps, and no guidance was offered for FY24. The reduction to a hold rating is on the back of Cedar Woods shares performing well in CY23, up 23% from December 31st 2022, and trading at a 9.9x FY24 expected EPS. The recent share price strength means Bell Potter expects shares to mark time until there is more certainty in the path of interest rates and guidance from the company.
- And Bell Potter has decreased the price target on Wisetech Global (ASX:WTC) and maintain a hold rating on the leading global provider of logistics services software following the release of the company’s FY23 results. While the FY23 results were in line or slightly above Bell Potter expectations and the company’s own guidance, the guidance for FY24 for EBITDA was below Bell Potter and market expectations driven by recent acquisitions thus changing the price target to factor in lower-than-expected margins as the company undertakes an acquisition growth strategy.
Wall Street closed mixed on Tuesday amid investor concerns over rising bond yields, sentiment wavering ahead of a key speech later this week from Fed Chair Jerome Powell and on key banking downgrades out of S&P Global. Several regional banks including KeyCorp and Comerica fell 4% on Tuesday after S&P Global cut credit ratings on several banks citing ‘tough operating conditions’ as the reason for the downgrade. The S&P500 fell 0.3% on Tuesday while the Dow Jones lost 0.5% and the tech-heavy Nasdaq posted a small gain at the closing bell.
Rising bond yields are placing pressure and adding further downside to equities in the US, with cash and short-dated bonds yielding 5% plus, thus attracting investors to the returns received from bonds over equities at these current levels.
And in Europe, markets closed higher across the region on Tuesday as a rise in technology stocks boosted gains across the board. French game maker Ubisoft Entertainment rose 9% after Microsoft said it would divest several gaming rights to the company as part of a new deal submitted to UK regulators for its takeover of Activision Blizzard, according to CNBC. Investors are also monitoring European natural gas prices which saw a sharp rise earlier this week amid threat of strike action in Australia which could disrupt 10% of the world’s LNG flows. The STOXX600 rose 0.7% on Tuesday while Germany’s DAX added 0.66%, the French CAC rose 0.59% and, in the UK, the FTSE100 lifted 0.18%.
The local market rose just 0.09% on Tuesday following a half a percent loss on Monday as the market volatility driven by global market moves and macroeconomic news out of China continues to impact investor sentiment. China’s sluggish recovery continues to go from bad to worse with weak retail sales and manufacturing output data providing further indication that the world’s second largest economy is struggling to regain momentum post pandemic. With no material stimulus to support recovery coming out of the Chinese government yet aside from some slight interest rate cuts and hub-support, the economy is looking to continue its deflation journey over months to come.
Heavy losses among consumer staples and information technology stocks on Tuesday were offset by strength in the consumer discretionary and energy sectors. IRESS tanked 36% while Premier Investments and Breville led the gains, adding 12% and 9% respectively.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open the midweek session down 0.24%.
- On the commodities front this morning, oil is trading 0.38% lower at US$79.80/barrel, gold is up 0.18% at US$1897/ounce and iron ore is up almost half a percent at US$109/tonne.
- AU$1.00 is buying US$0.64, 93.68 Japanese Yen, 50.04 British Pence and NZ$1.08
Trading Ideas:
- Bell Potter has increased the price target on Mader Group (ASX:MAD) from $6.10 to $6.90 and maintain a hold rating on the leading provider of specialised contract labour for maintenance of heavy mobile equipment in the resources and civil industries, following the release of the company’s FY23 results including revenue up 51% YoY to $608.8m, EBITDA up 57% to $75.1m and underlying NPAT up 48% YoY to $38.5m. Mader Group also expects FY24 revenue of at least $770m and NPAT of at least $50m implying material growth in the new financial year.
- And Trading Central has identified a bullish signal on Terracom (ASX:TER) following the formation of a pattern over a period of 45-days which is roughly the same amount of time the share price may rise from the close of $0.48 to the range of $0.55 to $0.57 according to standard principles of technical analysis.
Wall St has ended mixed on Monday as the Nasdaq ended its four-day losing streak. The S&P 500 rose 0.69% while the Nasdaq added 1.56%. On the other hand, the Dow Jones closed marginally lower by 0.11%.
Earnings season continued on Monday with Palo Alto Networks releasing stronger-than-expected results, which saw its share price rise 14.5% on Monday. Tesla and Meta also climbed 7% and 2.4% respectively to rebound from recent losses.
The 10-year Treasury note yield has reached a high of 4.34%, its highest level since November 2007. This is usually bad for tech and growth stocks as it lowers their promised future earnings.
Over in Europe, markets closed marginally higher after hitting a six-week low at the end of last week. The STOXX 600 ended the day 0.1% higher, with auto stocks leading gains, up by 1.1%. Germany’s DAX finished the day up 0.19%, the French CAC rose 0.47% and, in the UK, the FTSE 100 ended the day marginally lower by 0.06%.
Locally yesterday, the ASX200 closed 0.46% lower as the consumer staples sector closed 1.34% lower followed by the info tech sector closing 1.32% lower. The heavy losses were partially offset by the consumer discretionary sector ending the day 0.83% higher.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.24% at the open this morning.
- On the commodities front this morning,
- Oil is down 0.52% to US$80.82 a barrel as concern over China’s economy sparks a concern on market sentiment.
- Gold is up 0.35% to US$1894 an ounce as China premiums on gold hit its highest level since December 2016.
- And iron ore is up 0.93% to $US108.50 a tonne as steel hubs are yet to follow through on production cuts.
Trading Ideas:
- Bell Potter maintains a buy rating on Elders (ASX:ELD) but have raised the 12-month price target on the agriculture company by 15 cents to $7.40. Turnoff volumes have continued to recover from the lows experienced in the 2nd half of FY23 and cattle turnoff volumes are up 19% year-on-year.
- And Trading Central has identified a bullish signal in IGO Ltd (ASX:IGO), following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $12.48 to the range of $15.90-$16.70, according to the standard principles of technical analysis.
Wall Street ended mixed on Friday as gains in energy and defensive sectors like consumer staples and utilities offset weakness in large growth stocks on the Nasdaq. Alphabet and Tesla fell 1.9% and 1.7% respectively as investors fear interest rates could remain higher for longer which prompted the sell-off in technology stocks. The Dow Jones rose 0.07%, the S&P500 fell 0.01% and the tech-heavy Nasdaq lost 0.2%. Over the last 3 weeks, the Nasdaq has fallen 7.2%, its biggest decline since December. Beauty company Estée Lauder tumbled 3.3% on Friday after the company’s annual net sales and profit fell short of analysts’ expectations.
Over in Europe, markets closed lower across the region as investor sentiment slides on global economic concerns and further runway for tighter monetary policy. The STOXX600 fell 0.6%, Germany’s DAX lost 0.65%, the French CAC fell 0.38%, and, in the UK, the FTSE100 fell 0.65%.
Danish hearing aid manufacturer GN Store Nord fell 5.9% on Friday after JPMorgan cut its price target on the company following significant losses and weak second quarter results released on Thursday.
Locally on Friday the ASX rose just 0.03% as a 1.9% sell off among communication services stocks was offset by gains in the real estate and utilities sectors. For the week, the ASX fell 2.62% in line with the global market sell-off amid investor sentiment dampening on future rate hike outlook, slowing earnings growth out of reporting season results, and the Chinese economy continuing its sluggish growth post-pandemic.
What to watch today:
- Ahead of the opening bell this Monday, the SPI futures are anticipating the ASX to open 0.32% lower.
- On the commodities front this morning, oil is trading 0.06% higher at US$81.30/barrel, gold is up 0.07% at US$1890/ounce, and iron ore is up almost 1% at US$108.50/tonne.
- Stocks trading ex-dividend today include Vicinity Centres (ASX:VCX) and Steadfast Group (ASX:SDF). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- AU$1.00 is buying US$0.64, 93.12 Japanese Yen, 50.04 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on PWR Holdings (ASX:PWH) from a buy to a hold and maintain a $10.50 12-month price target on the leading provider of customised cooling solutions for the global automotive industry. The downgrade was following the release of FY23 results where revenue was a slight beat while gross profit and EBITDA were slight misses. The company also failed to issue any guidance for FY24 and cash at bank was lower than Bell Potter was expecting due to higher CAPEX.
- And Trading Central has identified a bullish signal on Piedmont Lithium (ASX:PLL) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may rise from the close of $0.72 to the range of $0.92-$0.96 according to standard principles of technical analysis.
The number of companies reporting results this week increased. The outlook for the healthcare sector seems to be slowing whilst in the technology sector, Life360 (ASX:360) surprised investors on the upside. The broader Aussie share market tumbled 2.64% (Mon-Thurs) as Chinese economic data and downgrade warnings for US banks weighed on sentiment.
In this week's wrap, Grady covers:
- (0:20) The major name sold off by investors
- (1:12) Why investors have fallen out of love with the healthcare sector
- (2:00) Margin contraction & income-investing
- (2:33) Life360’s (ASX:360) strong results
- (3:35) NAB’s (ASX:NAB) results and the crowd goes mild
- (4:10) Key takeaways for the week that was
- (5:36) Best performers
- (6:11) Most traded stocks & ETFs by Bell Direct clients
- (6:41) Three economic news items to watch out for
Read transcript article here.
Wall St fell for a third straight day as investors reacted to the latest round of earnings season results released. The Dow Jones dropped by 0.84%, the S&P 500 fell by 0.77% and the tech-heavy Nasdaq lost 1.17% overnight.
The 10-year treasury yield peaked, at its highest point since late 2022 on Thursday on outlook from the Federal Reserve’s July meeting minutes signaling further rate hikes may be required to control inflation in the region.
American retailer Walmart fell more than 2% after an earnings and revenue beat in the second quarter. This is continuing a trend with major averages in losing territory in August for stocks.
European markets fell on Thursday following the US Federal Reserve’s July meeting minutes which outlined further rate hikes may be on the horizon. The STOXX600 closed Thursday 0.90% lower, the German Dax followed suit falling 0.71% with the French CAC and FTSE 100 dropping 0.94% and 1.03% respectively.
Locally yesterday, the ASX200 closed the day 0.68% lower with the industrial and health sectors taking the biggest hit while real estate and energy stocks rallied to offset some of the session’s heavy losses.
What to watch today:
- The Australian share market is set to open lower this morning, with the SPI futures suggesting a fall of 0.39% at the open this morning.
- On the commodities front this morning, oil is up 0.98% to US$80.16 a barrel, gold has fallen marginally lower by 0.11% to US$1889 an ounce and Iron ore is trading flat at US$104 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Adacel Technologies (ASX:ADA) have decreased the 12-month price target from 80 cents per share to 75 cents per share. This is following a lower than forecasted profit before tax and gross profit outlined in the company’s FY23 results. FY23 revenue levels remained above expected which supports the maintenance of the buy rating.
- And Trading Central has identified a bearish signal in The Lottery Corp (ASX:TLC) indicating that the stock price may fall from the close of $5.18 to the close of $4.91-$4.97 over the pattern formed over 16 days, according to the standard principles of technical analysis.
Wall Street extended its red run into Wednesday as investors digested the latest FOMC meeting minutes that included some Fed officials saying further rate hikes may be needed to bring inflation down to the target. The meeting minutes also outlined the current robustness in the economy shown through recent third quarter GDP estimates and retail sales data are not what the Fed wants to see. The Dow Jones fell just over half a percent on Wednesday, the S&P500 lost 0.76% and the tech-heavy Nasdaq fell 1.15%.
TJX Companies rose 4% after the discount retailer beat Wall St expectations for Q2, while Target rallied 4% even after the retailer cut its full-year earnings forecast and second quarter sales fell short of expectations.
Over in Europe, markets closed lower in the region as investors assessed the latest inflation data out of the UK. The reading of inflation came in at 6.8%, which was a sharp decline from 7.9% in June mainly due to a slump in fuel prices. This reading was in line with expectations which poses a headache for the Bank of England as inflation is showing signs of cooling but wages growth yesterday continues to rise.
Locally, the ASX fell 1.5% on Wednesday after taking lead from the US on Tuesday and as investors digested the latest slew of poor economic data out of China indicating the economic recovery in the region remains sluggish. Information technology stocks took the biggest hit locally yesterday, though every sector closed the midweek session in the red.
Endeavour Group fell over 4% on Wednesday despite the company reporting FY23 results that fell short of analysts’ expectations. Investors may have sold out after the company failed to issue outlook for FY24 but FY23 turned out strong with NPAT up 6.9% to $529m and the full year dividend up 7.9% to 21.8cps.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.32% lower, extending yesterday’s losses into Thursday’s trading session.
- On the commodities front this morning oil is down 1.99% at US$79.38/barrel, gold is down 0.53% at US$1891.55/ounce and iron ore is up almost half a percent at US$104/tonne.
- AU$1.00 US$0.64, 93.95 Japanese yen, 51.22 British pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Life360 (ASX:360) from $9.25 to $10.50 and maintain a buy rating on the location services and hardware technology company following the release of the company’s first half results including revenue and adjusted EBITDA beating Bell Potter expectations. Life360 also announced total paying circles were up 62,000 quarter-on-quarter which nearly doubled what BP was expecting and cash as at June 30 was $64.2m which also beat forecasts.
- And Trading Central has identified a bullish signal on Australian Clinical Labs (ASX:ACL) following the formation of a pattern over a period 58-days which is roughly the same amount of time the share price may rise from the close of $3.27 to the range of $3.71 to $3.81 according to standard principles of technical analysis.
In New York overnight, US equities closed lower as investors concerns over the state of the global economy, particularly in China, sparked a sell-off in equities, in addition to banking stocks weighing down the market. The Dow Jones fell 1.02%, the S&P500 lost 1.16% and the tech-heavy Nasdaq fell 1.14% on Tuesday.
In Europe, markets closed lower on Tuesday as wages data in the UK weighed on investor sentiment. The UK median monthly wage, excluding bonuses, rose 7.8% in July from the prior corresponding period which is the largest annual growth rate since the records began in 2001, and provides further reason for the bank of England to continue raising interest rates to tackle inflation in the region. Unemployment in the UK also rose unexpectedly though from 4% to 4.2% in the three months to June.
The RBA’s meeting minutes were released yesterday which could have boosted investor sentiment as the key takeaways were the slowing economy and acute pressure on household finances were behind the latest rate pause. We are not out of the woods yet though as the RBA did say at the latest meeting that further monetary tightening may be required to ensure inflation reaches the target 2-3% range within a reasonable timeframe.
Lake Resources (ASX:LKE) soared 25% yesterday, extending the rally this week after the lithium explorer released an update on its flagship Kachi Project. The update outlined the company reported successful stage 1 extraction and injection testing at the site to support the production of high purity battery grade lithium carbonate at the Kachi Lithium brine Project.
The market rally yesterday may also have been driven by the release of Australia’s annual Wage Price Index data for Q2 coming in at growth of 3.6% which was lower than expectations of 3.7% growth, in a sign wages inflation is starting to ease.
Iron ore slipped below US$100/tonne yesterday to near its lowest intraday level since June following China’s surprise 15-basis point interest rate cut on the one-year medium-term lending facility, alongside further economic data that indicated the economy’s recovery remains sluggish.
China’s industrial production data came in at a 3.7% rise for July, down from a 4.4% rise in June and below economists’ expectations of another 4.4% rise for July. The softest manufacturing activity was reported in mining output as well as electrical machinery and apparatus output. Chinese retail sales data was also released yesterday which broadly missed expectations as consumer spend on retail in the region rose by 2.5% in July from a year ago, below expectations of a 4.5% rise.
What to watch today:
• Ahead of the local trading session here in Australia the SPI futures are expecting the local index to open 1.04% lower amid the global market sell-off overnight.
• On the broader commodities front this morning, oil is trading 1.77% lower at US$81/barrel, gold is down 0.23% at US$1903/ounce, and iron ore is down 1.9% at US$103.50/tonne.
• AU$1.00 buying US$0.65, 94.16 Japanese Yen, 51.22 British Pence and NZ$1.08.
Trading Ideas:
• Bell Potter has increased the price target on Pro Medicus (ASX:PME) from $67 to $70 and maintain a hold rating on the leading health imaging IT provider following the release of the company’s FY23 results including revenues increasing by 34%, and EBIT increased 34%, both of which beat expectations. Bell Potter sees the drivers of growth remain firmly in place i.e. too few radiologists, and more managed care leading to more need for diagnostic imaging.
• And Trading Central has identified a bearish signal on Goodman Group (ASX:GMG) following the formation of a pattern over a period of 66 days which is roughly the same amount of time the share price may fall from the close of $19.89 to the range of $17.90 to $18.20 according to standard principles of technical analysis.
Wall St closed higher on Monday as big tech names and chip stocks posted strong results. The S&P 500 finished the day 0.58% higher, the tech heavy Nasdaq followed suit posting a 1.05% gain, and the Dow Jones closed marginally higher by 0.07%.
Software company Nvidia ended the day 7.1% higher, rebounding from an 8.5% sell off last week. This was further boosted with Morgan Stanley touting Nvidia as a ‘top pick ahead of earnings’.
Over in Europe, there was a mixed reaction in markets after several down sessions last week. The Stoxx 600 closed marginally higher by 0.1% with retail stocks and financial services leading the way. The German DAX finished the day up 0.46% and the French CAC also finished the day 0.12% higher. However the FTSE 100 ended Monday 0.23% lower.
Locally yesterday, the ASX200 ended the first trading session of the week down 0.86% as a sharp sell-off in materials stocks weighed on the key index. The communications services, energy and info tech sectors were the only sectors to close higher on Monday.
Lake Resources led the winning stocks on Monday, jumping 7.7% while Carsales.com added 7% on strong FY23 results. Syrah Resources and Elders fell 6.85% and 6.10% respectively yesterday.
What to watch today:
- The Australian share market is set to open flat this morning.
- In terms of economic data, the RBA minutes meeting will be released today at 11:30am AEST.
- On the commodities front this morning, crude oil is down 0.88% to US$82.45 a barrel. Gold is down 0.33% to US$1907 an ounce after mounting pressures from a strong dollar and iron ore is up 1.93% to US$105.50 a tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Beach Energy (ASX:BPT) with a 12-month price target of $2. Beach Energy has a strong fully funded growth outlook diversified across five energy basins and four separate gas markets. The company is also rolling off peak capex into a step change in production and expects free cash flow in FY25-26.
- And Trading Central has identified a bullish signal in Super Retail Group (ASX:SUL) indicating that the stock price may rise from the close of $12.85 to the range of $13.70-13.90 over a pattern formed in 53 days, according to the standard principles of technical analysis.
Wall Street closed mixed on Friday with the Nasdaq posting a second weekly loss for the first time in 2023 as semiconductor stocks weighed on the tech heavy index. Over the week, the Dow Jones added 0.6%, while the S&P500 and Nasdaq each dropped 0.3% and 1.9% respectively.
July producer price index data was released in the U.S. on Friday and confirmed inflation remains sticky in the region. The data showed a rise of 0.3% on June which was above the 0.2% economists were expecting.
News Corp shares rallied on Friday after the media company reported an earnings beat in Q4.
Over in Europe, markets closed lower on Friday as investors continued to digest corporate earnings results alongside the release of unfavourable PPI data in the U.S. The STOXX600 fell 1.1% on Friday while Germany’s DAX lost just over 1%, the French CAC fell 1.26%, and in the UK, the FTSE100 fell 1.24%.
On Friday, UK economic output data was released showing economic output grew by 0.5% in June, which was higher than the expected growth of 0.2%.
Locally on Friday, the ASX200 fell 0.24%, weighed down by a sharp sell-off in the energy sector, while consumer discretionary and health care stocks offset some of the heavy losses to end the week higher. The sell-off on Friday was driven by investors responding to a slew of earnings results released including Baby Bunting dropping almost 2% after profit fell 51% and the full year dividend was slashed by 52% in addition to cost-cutting measures announced in the FY23 results.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open 0.41% lower to start the new trading week in the red.
- On the commodities front this morning, oil is trading 0.3% lower at US$82.96/barrel, gold is up 0.08% at US$1915/ounce and iron ore is up 1.93% at US$105.50/tonne.
- Stocks trading ex-dividend today include EUROZ Hartleys Group (ASX:EZL) and Suncorp Group (ASX:SUN). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- AU$1.00 is buying US$0.65, 94.14 Japanese Yen, 51.35 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has initiated coverage on Task Group Holdings (ASX:TSK) with a buy rating and a 12-month price target of $0.62. Task Group is an end-to-end Transaction Management and Customer Engagement platform that delivers a B2B Software as a Service solution to high quality enterprise clients including McDonalds, Starbucks and Compass Group in Australia, to manage the experience for customers from pre-order to payment. Bell Potter sees Task is trading at a 20% discount to global industry peers and the buy recommendation is based on the company’s exposure to future-facing growth and profitability.
- And Trading Central has identified a bullish signal on Harvey Norman (ASX:HVN) following the formation of a pattern over a period of 34-days which is roughly the same amount of time the share price may rise from the close of $3.87 to the range of $4.35 to $4.45 according to standard principles of technical analysis.
Reporting season ramped up this week, with investors reactive to news both good and bad. The Aussie share market rose 0.44% this week (Mon-Thu) as a 2.73% gain for the energy sector offset losses in the tech and healthcare sectors.
In this week's wrap, Grady covers:
- (0:21) CBA’s (ASX:CBA) record cash profit
- (0:49) Boral (ASX:BLD) & Cettire’s (ASX:CTT) strong results
- (2:37) Downer’s (ASX:DOW) dampened trading
- (3:05) What this week told investors & next week’s outlook
- (3:56) US inflation data moving markets
- (5:04) Best performing stocks in the ASX200
- (6:11) The most traded stocks & ETFs by Bell Direct clients
- (6:45) Three economic news items to watch out for
Wall St closed slightly higher on Thursday following the release of key inflation data that came in line with consensus expectations of a slight month-on-month growth by 0.2% while the annual inflation rate rose to 3.2% from 3% in June. While this reading was a slight uptick in inflation, it was expected and the annual rate came in under expectations of 3.3%, indicating inflation in the region remains sticky, but not out of control. On an earnings front, Disney led the Dow Jones higher after releasing third quarter results including a earnings per share of $1.03 which beat expectations and the media giant announced an upcoming price hike for ad-free Disney+ subscriptions.
The Dow Jones added 0.15%, the S&P 500 edged slightly higher by .03% and the tech heavy Nasdaq ended the day up 0.12%.
Over in Europe, markets closed higher on Thursday as positive earnings results were released in the region and investors reacted to US inflation data reading below expectations. The Stoxx 600 finished the day up 0.8% following a 2.2% growth in household goods stocks. The German Dax ended the day up 0.91%, the FTSE 100 closed 0.41% higher and the French CAC rose 1.52% by market close.
Locally yesterday, the Australian market closed 0.26% higher driven by strong gains for the energy and consumer discretionary sectors which rose 2.27% and 0.60% respectively. The strong gains were slightly dampened by a 1.79% drop in the info-tech sector.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.27% at the open this morning.
- On the commodities front this morning,
- Oil is down 1.87%, trading at US$82.82/barrel as economic data concerns have renewed demand fears.
- Gold is down 2.52% at US$1912/ounce after the US announced slower than expected inflation growth.
- And iron ore is trading down 2% at US$103.50/tonne as disappointing economic data from China has reduced demand in the construction industry.
Trading Ideas:
- Bell Potter maintains a buy rating on luxury online fashion retailer, Cettire (ASX:CTT) and has increased the 12-month price target on the company from $3.90 to $4 on the back of the company releasing very strong results including sales revenue up 98% on the prior corresponding period, and a healthy demand environment across all of the company’s operating regions.
- And Trading Central has identified a bullish signal on Perenti (ASX:PRN), following the formation of a pattern over a period of 29 days which is roughly the same amount of time the stock price may rise from the close of $1.22 to the range of $1.41 to $1.45, according to the standard principles of technical analysis.
Wall St closed lower again on Wednesday as investors await key inflation data out of the US later this week to gauge an insight into whether inflation is cooling or remains sticky which will give a hint as to the next rate move out of the Federal Reserve. The Dow Jones industrials index closed 0.54% lower, the S&P500 fell 0.7% and the tech-heavy Nasdaq lost 1.17%.
The US inflation reading for July is out on Thursday US time with economists expecting inflation to rise 3.3% in July from a 3% rise in June which would indicate inflation remains sticky in the world’s largest economy. Penn Entertainment soared 9.1% on Wednesday after the casino company said it is launching an online sportsbook with ESPN called ESPN Bet. Roblox on the other hand tanked 22% after missing Wall St expectations in second quarter results.
Over in Europe, markets recovered from Tuesday’s sell-off to close higher on Wednesday as investors digested China’s disinflation and Italy’s weakening of the surprise windfall tax on banks announced earlier this week. Italy’s finance ministry announced late on Tuesday that the tax on net interest income would be capped at 0.1% of risk-weighted assets – one fifth of the level that Citi had estimated it could reach according to CNBC. The STOXX600 closed 0.4% higher, Germany’s DAX added half a percent, the French CAC rose 0.72% and, in the UK, the FTSE100 climbed 0.8%.
Locally on Wednesday, the key index rose 0.37% led by financials stocks jumping 1.21% on the back of CBA releasing strong FY23 results. Healthcare stocks underperformed the market on Wednesday, with the sector closing down 0.9%, while tech stocks continued to rally, up 0.87% at the closing bell.
CBA’s results were the highlight of Wednesday’s trading session with the big bank announcing a record cash profit of $10.16bn boosted by higher interest rates, net interest margin up 17 basis points on FY22 to 2.07%, and dividends per share of $4.50 in FY23, up 17% on FY22. Investors responded positively to the results with the CBA share price rising 2.6% on Wednesday.
On the economic data front, China’s annual inflation rate came in at a reading of minus 0.3% year on year in July which is the first decrease since February 2021. Combining this data with Chinese PPI coming in recently at a -4.4% decline, a 10th straight month that prices have been negative, indicates the Chinese economy is well and truly in deflation mode and more stimulus out of the Chinese government is required to kickstart the economy back into growth mode.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open Thursday’s session 0.05% higher.
- On the commodities front this morning, oil is trading 1.63% higher at US$84.30/barrel, gold is down half a percent at US$1915/ounce and iron ore is up 1.44% at US$105.50/tonne.
- AU$1.00 is buying US$0.65, 93.82 Japanese Yen, 51.27 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has maintained a hold rating on A2 Milk (ASX:A2M) company whilst decreasing the 12-month price target on the dairy company from $5.95 to $5.70 ahead of the release of the company’s FY23 results and on the back of assessing key monthly takeaways that monitor A2’s performance. These data points include Australian exports to China remaining weak, China infant milk formula imports falling 9% year on Year and cost of goods sold continuing to fall with the average price down 22% year on year in the second half of FY23.
- Trading Central has identified a bullish signal on Evolution Mining (ASX:EVN) following the formation of a pattern over a period of 83-days which is roughly the same amount of time the share price may rise from the close of $3.75 to the range of $4.40 to $4.55 according to standard principles of technical analysis.
Wall Street reversed Monday’s rally to trade lower on Tuesday after credit rating agency Moody’s downgraded the credit rating on several banks including M&T Bank and Pinnacle Financial citing deposit risk as the reason for the downgrades. Moody’s also placed Bank of NY Mellon and State Street on review for a downgrade. This caused investor fears of a further banking crisis to resurface thus sparking the sell-off on Tuesday. The Dow Jones fell 0.45% on Tuesday, while the S&P500 lost 0.42% and the tech-heavy Nasdaq declined 0.79%.
And in the European region markets closed lower on Tuesday as investors await the release of significant inflation data out later this week alongside reactions to a shock banking tax announcement out of Italy in the form of a 40% windfall tax on banking profits which dragged down the banking sector on Tuesday. Banks led the losses in the region overnight while healthcare stocks bucked the trend to add 3.2%. The STOXX600 ended down 0.2% on Tuesday, Germany’s DAX fell 1.1%, the French CAC shed 0.69% and, in the UK, the FTSE100 fell 0.36%.
The local market rose just 0.03% on Tuesday as a selloff in consumer staples stocks was offset by strong gains in the healthcare sector, a sector which has been sharply beaten down this year.
We are preparing for the ramp up of earnings season this week which investors have already been particularly responsive to with companies that have reported, both good and bad results, experiencing double digit share price movement on the day of results being released. The US reporting season has proven to be stronger than expected, so we could see a similar outcome of results here in Australia.
James Hardie Industries released first quarter results yesterday that sent the company’s share price soaring 15%. The leading global supplier of fiber cement building products reported record global adjusted EBITDA of US$279.1m, with an adjusted EBITDA margin of 29.2%, net income up 13% and operating cash flow increased 64%.
JHX also provided outlook, which is a big tick for investors, but only for the second quarter of FY24, with the company expecting adjusted net income between US$170-$190m, North American, its biggest market, is expected to produce volumes to be in the range of 740-770 million and CAPEX of US$550m.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the ASX to open the midweek session down 0.07%.
- On the commodities front this morning, oil is trading 1.05% higher at US$82.8/barrel, gold is down 0.53% at US$1926/ounce and iron ore is down 2.35% at US$104/tonne amid declining demand and robust inventories of the commodity.
- AU$1.00 is buying US$0.65, 93.73 Japanese Yen, 51.19 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has reduced the price target on Smartpay (ASX:SMP) from $2.10 to $1.97 and maintain a buy rating on the payment solutions provider on the back of competitor Block releasing a quarterly update shining light on the payment space. Bell Potter has adjusted forecasts across FY24-FY26 on the grounds of material reductions to the company’s Australian transaction segment revenues on the assumption of slowing Average Revenue Per Unit reflecting an overall slowdown in consumer spending, and softer EBITDA is expected for FY24 before Bell Potter’s assumed margin expansion kicks in. Bell Potter remain positive on Smartpay however have slightly reduced the price target on these grounds.
- And Trading Central has identified a bullish signal on Pilbara Minerals (ASX:PLS) following the formation of a pattern over a period of 57-days which is roughly the same amount of time the share price may rise from the close of $5.32 to the range of $5.95 to $6.10 according to standard principles of technical analysis.
The four day sell-off on Wall St came to an end on Monday as corporate earnings results boosted investor sentiment ahead of another big reporting season week and the release of key inflation data out later this week. The Dow Jones advanced 1.16%, it’s best day in almost 2-months. The S&P 500 added 0.9%, and the tech heavy Nasdaq ended Monday’s session up 0.61%, however was restricted by a 1% drop in Tesla.
Corporate earnings season has kicked off with a bang, with results stronger than expected. Of the 85% of companies that have posted their quarterly results so far 80% have beat Wall St forecasts according to FactSet.
Over in Europe, markets closed mixed on Monday amid the ongoing release of corporate earnings results and ahead of the release of two key inflation prints later in the week. The STOXX 600 closed 0.1% higher, however the German DAX ended the day marginally lower. In the UK, the FTSE 100 fell 0.13% and the French CAC finished the day off 0.06% higher.
The local market closed 0.22% lower on Monday, weighed down by investors selling out of the healthcare and financials sectors.
ResMed continued its sell-off yesterday, with the healthcare company falling a further 4.23% on the back of poor performance for the stock in the US on Friday. Despite this, Goldman Sachs has said while ResMed’s latest update was disappointing on a margins front, performance should improve soon and this dip in the share price presents as a buying opportunity.
What to watch today:
- The Australian share market is set to open higher this morning with the SPI futures suggesting a rise of 0.4% at the opening bell.
- In terms of economic data, both the Westpac consumer confidence data for August and the NAB business confidence data for July will be released today with the market expecting a decline in both readings.
- On the commodities front this morning,
- Oil is trading down 0.32% at US$82.56 dollars/barrel as Saudi Arabia has hinted at further production cuts
- Gold is trading 0.27% lower at US$1936 dollars/ounce.
- And iron ore, trading at yesterday’s reading of US$106.50/tonne.
Trading Ideas:
- Bell Potter maintains a buy rating on Aeris Resources (ASX:AIS) however has significantly reduced the 12-month price target on the copper miner following the release of June quarter results including further deferrals of production at Mt Colin and Jaguar being placed on care and maintenance mode, contributing to higher overall costs and lower production.
- And Trading Central has identified a bearish signal on Platinum Capital (ASX:PMC), following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may fall from the close of $1.30 to the range of $1.21-$1.23, according to the standard principles of technical analysis.
Mixed jobs data sparked a sell-off on Wall St on Friday with the key indices closing lower for the session and the week. While the number of jobs added in the month of July fell short of expectations at 187,000, unemployment ticked lower to 3.5% and average hourly wages came in above expectations rising 0.4% for the month and 4.4% annually.
The release of US CPI data will be a key event this week in helping the Fed determine its next rate move following the stronger-than-expected jobs data.
On Friday, the Dow Jones fell 0.43%, the S&P500 shed 0.53% and the tech-heavy Nasdaq dropped 0.36%. For the week the Nasdaq and S&P500 fell over 2% each and the Dow Jones lost 1.1%. On the earnings season front, Amazon rallied 5.5% on Friday after releasing solid second quarter results including a return to double-digit revenue growth and boosted second half guidance. Booking holdings, the parent company of Booking.com, Agoda and other travel companies, rose 7.9% on strong results amid the ongoing surge in travel demand.
Apple also weighed on Wall St on Friday after the tech-giant slid more than 4% following the release of earnings results that included iPhone sales stalling more than expected in the latest quarter.
Over in Europe, markets closed slightly higher on Friday as investors continued digesting corporate earnings results alongside the Bank of England’s rate hike decision. The STOXX-600 rose 0.3% on Friday, Germany’s DAX added 0.37%, the French CAC rose 0.75% and, in the UK, the FTSE100 gained 0.47% on Friday.
Rolls Royce shares rose 6% on Friday after the company reported a strong recovery in profit.
The local market fell in morning trade on Friday on the back of the global sell-off on Thursday before rebounding to close Friday’s session up 0.19%. Healthcare took the biggest hit on Friday as CSL and ResMed weighed on the sector.
Gold miners also lost ground on Friday as the price of the precious commodity trade down over 1% last week. The 2023 favourite technology sector boosted the market into positive territory at the session’s end today with the sector climbing 0.92% at the closing bell.
Trading volumes were also especially light last week so the market was likely down due to investors taking a pause ahead of the ramp up in reporting season locally this week.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open the first session of the new trading week down 0.15%.
- On the commodities front this morning oil is trading almost half a percent higher at US$83.20/barrel, gold is up 0.15% at US$1945/ounce, iron ore is down 1.84% at US$106.50/tonne and coffee is trading down 2.06% at US$161/pound amid concerns of oversupply.
Trading Ideas:
- Bell Potter has increased the rating on City Chic Collective (ASX:CCX) from a hold to a buy and significantly increased the price target on the plus size fashion company from 42cps to 70cps following the company’s divestment of its Evans business and EMEA inventory which helps reduce the company’s high inventory build that has been dampening performance in recent times. Bell Potter sees the divestment as providing a clearer pathway to profitability for City Chic.
- And Trading Central has identified a bullish signal on South32 (ASX:S32) following the formation of a pattern over a period of 69 days which is roughly the same amount of time the share price may rise from the close of $3.94 to the range of $4.31 to $4.39 according to standard principles of technical analysis.
Reporting season kicked off this week with a small list of key names releasing results, while overseas was possibly the busiest results week in Europe and the US earnings season. Other key events driving markets were the Fitch Ratings downgrade on the US, China’s stimulus policy and Australia’s RBA rate pause. The Aussie share market fell 1.24% this week (Mon-Thu) as the local market took lead from the global market sell-off.
In this week's wrap, Grady covers:
- (0:30) China’s stimulus package
- (1:45) Global large caps releasing results
- (4:18) Local company results
- (4:50) Best performing stocks in the ASX200
- (5:56) The most traded stocks & ETFs by Bell Direct clients
- (6:29) Three economic news items to watch out for
Wall St closed lower on Thursday amid increasing pressure from rising bond yields, which have been on the rise since the Fitch downgrade earlier this week. The S&P 500 fell for the third straight day, closing the session down 0.25%, while the Dow Jones shed 0.19% and the tech-heavy Nasdaq closed marginally lower, down 0.1%.
US bond yields are trading at 4.18%, close to the highest levels since November 2022. This has had a significant impact on the real estate sector which closed more than 1% lower on Thursday.
After rallying for the most part of the year, it is expected that the US market may slow after both the S&P 500 and tech heavy Nasdaq secured their 5th straight month of gains earlier this week.
Over in Europe, markets in the region closed lower again on Thursday as investors assessed the latest slew of corporate earnings results alongside the Bank of England announcing a 25-basis point rate hike in a bid to tackle the stubbornly high inflation in the region.
The STOXX600 fell 0.7% with tech leading the losses, closing down by 1.8% as global sentiment remains shaky on the Fitch US downgrade. Oil and gas stocks rallied though after Saudi Arabia said it would extend output cut to 1 million barrels per day. Germany’s DAX closed 0.8% lower, the French CAC lost 0.72% and, in the UK, the FTSE100 fell 0.43%.
Locally, the Australian market closed 0.58% lower as a sentiment-driven sell-off in technology stocks weighed on the key index, while materials ended the day down 1.06%. The sell-off locally yesterday was driven by global market turbulence which has been the central theme over the last few days following the Fitch downgrade of the US.
What to watch today:
- The Australian share market is set to open lower with the SPI futures suggesting a fall of 0.10% at the open this morning, extending the theme from global turbulence overnight.
- In terms of economic data, at 11:30am AEST the RBA is set to make a statement on monetary policy.
- On the commodities front this morning,
- Oil has jumped 2.80%, trading at US$81.61 per barrel. The price has rebounded after both Russia and Saudi Arabia announced an extension in oil output cuts.
- Gold rose marginally by 0.01%, however is at its lowest level in the past three weeks with incoming pressure from a strong dollar.
- And Iron ore has fallen 1.35% to US$109.50 after a fourth straight contraction in China’s factory activity.
Trading Ideas:
- Bell Potter maintains a buy rating on IVE Group (ASX:IGL) as a lack of trading update suggests the FY23 guidance is set to be met or exceeded. Trading currently at $2.31, Bell potter has a 12-month price target on the company of $3.00, which suggests a 29.9% share price growth in a year.
- And trading central has identified a bearish signal on Ingenia Communities Group (ASX:INA), indicating that the stock price may fall from the close of $4.05 to the range of $3.35-$3.50 over a period of 18 days, according to standard principles of technical analysis.
Fitch Ratings downgrading the US credit rating to AA+ from AAA sparked a panic sell off on Wall St overnight with the Dow Jones closing the day down almost 1%, while the S&P500 lost 1.38% and the tech heavy Nasdaq tumbled 2.17%. The Nasdaq has its worst day since February as the Fitch ratings cut on the long-term foreign currency issuer default rating on the U.S. citing “expected fiscal deterioration over the next three years” as the reason behind the move. The last time the US was downgraded was in 2011 by Standard’s and Poor. Economists and analysts alike are expecting the risk-driven sell-off to be short lived and the impact of the downgrade to be temporary.
Norwegian Cruise Line shares fell 3% on Wednesday, a day after the company issued weaker-than-expected guidance for the third quarter. SolarEdge Technologies tanked 19% after the company reported revenue of US$991m which fell short of analysts’ estimates of US$992m, and the company also issued weaker-than-expected guidance for Q3 revenue.
Over in Europe, markets closed lower across the region as investors digested the U.S. credit rating downgrade alongside the release of key corporate results. The STOXX600 fell 1.35%, Germany’s DAX fell 1.36%, the French CAC lost 1.26%, and, in the UK, the FTSE100 fell 1.36%.
Siemens Healthcare fell just under 7% on Wednesday after the company reported a third quarter profit decline.
The local index closed 1.29% lower yesterday with every sector ending the midweek session in the red on the back of a sell-off in New York on Tuesday. Utilities stocks took the biggest hit, with the sector closing down 2.19% while REIT stocks gave up all of Tuesday’s gains to close down just shy of 2%.
The big iron ore miners also took a hit yesterday with BHP (ASX:BHP), Rio (ASX:RIO) and FMG (ASX:FMG) falling 1.1%, 0.9% and 2% respectively on a decline in the price of iron ore to US$111/tonne. Pilbara Minerals rallied yesterday after the lithium miner announced an update on the final investment decision for its mid-stream demonstration plant with the board granting approval for construction of the plant to produce value added lithium product at Pilgangoora. The plant will cost $105m, $20m of which will be funded by an Australian government grant.
What to watch today:
- The sell-off on Wall St is likely to impact the local market today with the SPI futures anticipating the ASX to open Thursday’s session down 0.79%.
- On the commodities front this morning oil is trading 2.02% lower at US$79.64/barrel, uranium is up 0.18% at US$56.24/pound gold is down almost half a percent at US$1935/ounce and iron ore is flat at US$111/tonne.
- AU$1.00 is buying US$0.65, 93.72 Japanese Yen, 51.52 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on PSC Insurance (ASX:PSI) from $5.86 to $6.41 and maintain a buy rating on the diversified insurance company following the release of the company’s trading update outlining that it expects it expects to deliver underlying EBITDA of $111m for FY23 subject to audit and signoff, which is well above the previously guided range.
- And Bell Potter has decreased the 12-month price target on Calix (ASX:CXL) from $9 to $8.70 and maintain a speculative buy rating on the emerging environmental technology company following the release Pilbara Minerals’ update on the final investment decision for the mid-stream demonstration plant which signifies a key de-risking milestone as the plant is a joint venture between PLS and Calix. The FID reflects a satisfactory level of technical and economic feasibility and lithium phosphate marketing completed to date to advance the project into construction.
US equities closed mixed on Tuesday as investors digested corporate earnings results against the release of key economic data. The S&P500 fell 0.27%, and the tech-heavy Nasdaq lost 0.43% but the Dow Jones reversed earlier losses to close up 0.2%.
The key economic data released in the US again came in favourable showing signs of resilience in the US economy against cooling inflation to support the idea that a soft landing is expected over a recession. JOLTs Job Openings data for June showed the economy added 9.582m jobs over the month, down slightly from May’s reading of 9.616m and US PMI manufacturing for July came in at 46.4 points, a slight uptick from the 46 points recorded in June.
In Europe, markets closed lower on Tuesday as investors digested corporate earnings results during this busy week of corporate results being released. The STOXX600 fell 0.88%, Germany’s DAX lost 1.26%, the French CAC shed 1.22% and, in the UK, the FTSE100 shed 0.43%. Eurozone manufacturing activity also fell in July at the fastest pace since the start of the COVID-19 pandemic, while a report on eurozone inflation showed inflation eased further in July in the region, gaining just 1.9% through the month according to Eikon data.
Locally yesterday, the ASX200 rose 0.54% as investors and Australians alike breathed a deep sigh of relief as the RBA announced a hold on rate hikes for a second consecutive month. Every sector closed in the green yesterday but the sectors that benefit from lower interest rates felt the biggest rally, led by the tech sector jumping almost 1.14%, while consumer discretionary and real estate stocks rose 0.77% and 0.43% respectively.
The RBA has held the nation’s cash rate at 4.1% for the month ahead which sparked a sharp rally on the local index in afternoon trade. RBA governor Phil Lowe said the pause ‘will provide further time to assess the impact of the increase in interest rates to date and the economic outlook’. In a similar note to last month though, Mr Lowe also warned further interest rate hikes may be required to get inflation to the target range of 2-3%, from the current annual rate of 6%.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open 0.53% lower for the midweek session.
- On the commodities front this morning, oil is trading down half a percent at US$81.39/barrel, gold is down almost 1% at US$1944/ounce and iron ore is down 3.06% at US$111/tonne.
- All eyes have been on the Chinese government over the last few weeks amid speculation further stimulus policy will be announced. This came on Monday in the form of China releasing a policy document containing 20 measures to restore and boost consumption including increasing consumer loans to encourage car purchases and building more affordable homes for young people.
- AU$1.00 is buying 66 US cents, 94.76 Japanese Yen, 51.94 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Gold Road Resources (ASX:GOR) from $1.95 to $2.05 and maintain a buy rating on the gold miner and producer following the release of the company’s second quarter CY23 report including 76,000 ounces of gold produced which topped Bell Potter’s expectations and all-in-sustaining-costs came in at $1620/ounce which fell below Bell Potter’s expected $1885/ounce. The company also upgraded guidance for the calendar year and Gold Road is setting up for a big CY24.
- And Trading Central has identified a bullish signal on Cedar Woods Properties (ASX:CWP) following the formation of a pattern over a period of 397-days which is roughly the same amount of time the share price may rise from the close of $5.19 to the range of $6.80 to $7.20 according to standard principles of technical analysis.
Wall St ended a strong month with a rise in stocks on Monday ahead of a busy earnings week. The Dow Jones finished the trading day up 0.28%, the S&P 500 rose 0.15% and the tech heavy Nasdaq added 0.21%.
The S&P 500 had 5 months of consecutive growth for the first time since August 2021, finishing the month up 3.1%. The Dow made a 13-day advance during July, it’s longest streak of gains going back to 1987.
In recent weeks, investors have been growing more optimistic about a soft landing in the US on the back of favorable economic data and resilience in both the job market and on a GDP front. Earnings season has also proven to show better than expected results thus far.
Thursday is looking to be a big day of earnings season news with both Amazon and Apple’s set to release results, which could “set the tone” for the remainder of the month.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a 0.34% rise at the open this morning.
- In terms of economic data, the RBA interest rate decision will be announced at 2:30pm today with a consensus of 4.35% or 25 basis points, up from the previous 4.1%.
- Looking now at commodities,
- Crude oil has jumped 1.43%, trading at US$81.74 a barrel after a tightening global supply and an increased demand increasing prices.
- The price of gold is slightly higher, up 0.31% trading at US$1,965.34 an ounce.
- And iron ore has finished the day 0.87% lower as the idea of Chinese economy stabilization slows.
- AU$1.00 is buying US$0.68, 95.58 Japanese Yen, 51.63 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has slightly decreased the price target on AMA Group (ASX:AMA) from 28 cents per share to 26 cents per share and maintain a buy rating on Australia’s largest accident repair group following the release of the company’s fourth quarter update including underlying cashflows continuing to improve and closing cash up $8.4m to $28.9m as at 30th June. The reason for the 12-month price target decrease is due to increased uncertainty around the company’s capital SMART repricing.
- And trading central has identified a bullish signal on Infratil Ltd (ASX:IFT), following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $9.36 to the range of $9.70-$9.85 according to the standard principles of technical analysis.
Wall Street closed higher on Friday and notched out gains across the key indices for the week as investors welcomed favourable inflation data in the form of the personal consumption expenditures price index. The data is a key driver of the Fed’s interest rate decisions and gained just 0.2% month-on-month, the same reading as the prior month and well below the anticipated 4.2% rise.
Stronger than expected GDP in the US and a better-than-expected earnings season so far in the US has analysts’ believing markets could jump to new highs. On Friday, the Dow Jones rose 0.50%, the S&P500 added 0.99% and the Nasdaq lifted 1.9%.
Proctor & Gamble shares rose 3% on Friday after the company posted earnings and revenue that beat analysts’ expectations for the most recent quarter, while Intel jumped 6.6% on Friday as investors welcomed the tech company’s return to profitability.
Over in Europe, markets closed mixed as Germany’s economic growth stagnated in the second quarter indicating the economy is stuck between stagflation and a recession. The STOXX600 fell 0.2% on Friday while Germany’s DAX rose 0.4%, the French CAC added 0.15% and, in the UK, the FTSE100 lifted 0.02%.
The bank of Japan maintained its negative interest rate on Friday but announced it would allow “greater flexibility” in its targeted range for 10-year Japanese government bond yields which some analysts are taking as a sign of potential policy shift to come. The strict yield curve policy will now allow + and - 0.5% movements and the BoJ will now offer to purchase 10-year JGBs at 1% through fixed rate operations.
Locally on Friday the key index fell 0.7% driven by the US sell-off on Thursday, however for the week the ASX200 posted a 1.23% gain. The REIT sector took the biggest hit locally on Friday while consumer discretionary stocks also fell 0.88% following the release of retail sales data for June. The data showed the full impact the RBA interest rate hikes are having on consumer spend with the reading coming in at a decline of 0.8% for the month of June, down from a 0.8% rise in May and below what consensus was expecting of a flat reading on the prior month.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the local index to open the first trading session of the new week up 0.26%.
- On the commodities front this morning, oil is trading 0.11% lower at US$80.49/barrel, gold is up 0.76% at US$1959.85/ounce, iron ore is down 0.87% at US$114.50/tonne.
- AU$1.00 is buying US$0.67, 93.77 Japanese Yen, 51.63 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Capricorn Metals (ASX:CMM) to $5.19 from $4.95 and maintain a buy rating on the gold exploration and development company following the release of the company’s June quarter update including Capricorn Metals producing 120,014 ounces of gold at its Karlawinda Gold Project over FY23 at all-in-sustaining-costs of $1208/ounce which fell slightly short of production expectations by Bell Potter analysts’ however the AISC were below BP expectations. The company also boasts some of the lowest costs in the sector and consistently generates strong cash margins.
- And Trading Central has identified a bearish signal on Regis Resources (ASX:RRL) following the formation of a pattern over a period of 72-days which is roughly the same amount of time the share price may fall from the close of $1.71 to the range of $1.32 to $1.42 according to standard principles of technical analysis.
The release of economic data around the world was the key driver of market movements this week in addition to speculation around China’s support policy announcement and investors responding to earnings season results. The Aussie share market rose 1.94% this week (Mon-Thu) with every sector posting a modest gain led by the Communication Services sector jumping 3.46%, while energy added 3.42% and REIT stocks felt some much-needed relief, lifting 3.32%.
In this week's wrap, Grady covers:
- (0:10) The release of economic data around the world
- (0:22) Two key reasons big miners stole the show locally
- (1:31) Updates on Rio Tinto (ASX:RIO) & Fortescue Metals Group (ASX:FMG)
- (4:33) Best performing stocks in the ASX200
- (5:39) The most traded stocks & ETFs by Bell Direct clients
- (6:14) Three economic news items to watch out for
Wall St closed lower on Thursday following the Fed’s interest rate hike of 25-basis points, and US GDP data coming in at 2.4% growth for Q2 which beat economists’ expectations. The strength in US economic growth is in-line with the Fed’s expectations for inflation in the world’s largest economy to remain sticky for a little while to come. The Dow Jones snapped its longest rally since 1987 closing down 0.67%, the S&P500 fell 0.64% and the tech-heavy Nasdaq dropped 0.55% on Thursday.
Social media giant Meta jumped 4.4% after reporting a jump in second quarter advertising revenue and topping expectations for quarterly results. Meanwhile, Southwest airlines posted a dip in quarterly profit which sent shares in the carrier down 8.47%.
Over in Europe, the European Central Bank hiked the region’s cash rate by 25-basis points overnight to 3.75%, with central bank officials noting that while inflation in the region is falling, the hike is to ensure inflation continues to fall. Stocks in the region closed higher on Thursday on the outlook for rates to pause as early as the September ECB meeting. The STOXX600 rose 1.4%, Germany’s DAX rose 1.7%, the French CAC added 2.05%, and, in the UK, the FTSE100 lifted 0.2%.
Locally yesterday, the ASX200 closed 0.73% higher buoyed by a 3.33% rise for the REIT sector as investor appetite for real estate stocks rose on optimism that the Fed has now finished its monetary tightening cycle. The energy and materials sectors were the only two sectors to close Thursday’s session in the red.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open the last trading session of the week down 0.59% on the back of the US sell-off overnight.
- On the commodities front this morning, oil is trading 1.1% higher at 79.65 US dollars a barrel, gold is trading 1.36% lower at 1945 US dollars an ounce, and iron ore continues its rally, trading 0.86% higher at 117 US dollars and 50 cents a tonne.
- AU$1.00 is buying US$0.67, 93.54 Japanese Yen, 52.69 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on Paragon Care (ASX:PGC) from a buy to a hold and significantly decreased the 12-month price target from 45 cents per share to 26 cents per share following the release of a trading update out of the medical equipment, devices and consumables company. The update outlined the EBITDA growth expectation at around 30% which is a miss of Bell Potter expectations, while the company also announced the closure of the Lovell manufacturing business, which entail a $3m one off charge in FY23 and the company ends FY23 with net debt of $64m. Bell Potter’s analyst sees the growth outlook as opaque and appears dependent on revenue growth in Asia, which is the primary reason for the downgrade to a hold and decreased price target.
- And Trading Central has identified a bullish signal on Stockland Corp. (ASX:SGP) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $4.27 to the range of $4.48 to $4.54 according to standard principles of technical analysis.
Wall Street closed mixed on Wednesday with the Dow Jones closing higher for a 13th straight session, adding 0.23%, while the Nasdaq and S&P500 ended the session in the red, down 0.02% and 0.12% respectively. Investors digested the Federal Reserve’s announcement of a 25-basis point rate hike, taking the US cash rate to 5.25%-5.50%, the highest level in more than 22-years. Markets slipped in afternoon trade following the rate hike and comments out of fed chair Jerome Powell that another rate hike may be required in September pending the economic data readings over the coming months.
Google parent company, Alphabet, jumped 5.8% on Wednesday as cloud revenue growth boosted the company to report a better-than-expected quarter. Aircraft manufacturer Boeing also lifted 8.7% on Wednesday after also reporting a second-quarter beat on the back of increased commercial aircraft deliveries.
Over in Europe, markets closed lower in the region following the announcement of the Fed’s rate hike in the US in addition to the release of corporate earnings results in the region. The STOXX600 fell 0.6%, Germany’s DAX lost 0.5%, the French CAC fell 1.35%, and, in the UK, the FTSE100 shed 0.2%. Deutsche Bank shares rose 1.36% on Wednesday after the big bank reported a net profit of 763 million euros which beat expectations despite being a 27% decline year-on-year.
It’s a big week for central bank rate decisions with the Bank of Japan rate decision out on Friday and the European Central Bank decision announced on Thursday European time.
In Australia, the ASX rose 0.85% on Wednesday on the release of Australia’s CPI data for Q2 coming in at a quarterly rise of just 0.8% to an annual rate of 6%, which is well below the annual Q1 rate of 7% and below the 6.2% economists’ were expecting. The inflation reading boosted market sentiment as investors see the falling inflation as a sign of rate pauses on the horizon out of the RBA. While 6% in still above the RBA’s target range of 2-3%, the 1% decline in the annual inflation rate over the quarter is a strong sign the RBA’s rate hikes are working to cool inflation.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the local index to open just 0.01% lower following the Fed’s interest rate decision causing global markets to sell-off overnight.
- On the commodities front this morning, oil is trading 1% lower at US$78.84/barrel, gold is up 0.36% at US$1971.61/ounce, and iron ore is up 0.87% at US$116.50/tonne.
- AU$1.00 is buying US$0.68, 94.78 Japanese Yen, 52.69 British pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Catapult Group (ASX:CAT) from $1.20 to $1.35 per share and maintain a buy rating on the leading global provider of elite athlete wearable tracking technology and software provider, following the release of the company’s first quarter update. Over the quarter, Catapult reported revenue growth over 20%, annual contract value rose over 20% year-on-year on a constant currency basis, and the company hopes to achieve Free Cash Flow positivity in FY24.
- And Bell Potter has slightly decreased the 12-month price target on Develop Global (ASX:DVP) from $3.90 to $3.80 and maintain a buy rating on the hybrid model mining company following an update including Develop withdrawing from the Kathleen Valley underground mining contract tender process due to expanded scope of the contract, whilst also noting the forthcoming restart of the Woodlawn operations coinciding with peak revenue generation from the Bellevue mining contract, underpinning a significant ramp up in earnings and future cash flow generation.
US equities closed higher on Tuesday with the Dow Jones posting a positive close for a 12th straight session, the longest winning streak in 6-years. The tech-heavy Nasdaq and S&P500 also closed higher as investors respond to the latest earnings results and await the key interest rate decision out of the Federal Reserve tomorrow.
In Europe, markets also mostly rallied on Tuesday as investors in the region also responded to earnings results from big names including Unilever which beat analysts’ expectations to report a 7.9% rise in underlying Q2 sales. The European Central Bank also meets on Thursday where it is widely expected that a 25-basis point rate hike will be announced. The STOXX600 rose 0.47% on Tuesday, buoyed by mining stocks rising on the back of new Chinese stimulus measures, Germany’s DAX added 0.13%, the French CAC fell 0.16% and, in the UK, the FTSE100 added 0.17%.
China’s leaders pledged on Monday to step up the government’s policy support for the extremely weak post-COVID recovery in the region, with a focus on boosting domestic demand and aiding recovery in the building sector. Looking at China’s Q2 growth rate data, the world’s second largest economy grew only 0.8% QoQ vs 2.2% growth in Q1, in a sign economic recovery is stalling.
The local market rallied almost half a percent yesterday boosted by the iron ore miners jumping on the back of speculation that China will introduce further stimulus policy to reignite the nation’s recovery post-pandemic, causing a rise in the price of iron ore today. BHP added 3.84% yesterday, Fortescue rallied 4.55% and Rio Tinto jumped 3.4%.
Technology stocks weighed on the market yesterday with the sector closing down 0.25% on the back of the Nasdaq-100’s special rebalancing which is aimed at reducing the concentration of heavyweight companies that account for nearly half of the index’s weight. Stocks involved in the rebalancing include Microsoft, Apple and Tesla which account for 43.8% of the index weight coming down to 38.5% as a result of the rebalancing.
What to watch today:
- Ahead of local trading session here is Australia, the SPI futures are anticipating the ASX to open the midweek trading session up 0.26%.
- Taking a look at commodities, the price of wheat hit a 5-month high yesterday after Russia launched a drone attack at a port in the Ukraine, destroying a grain hangar storing wheat grain. Oil is up 0.88% at US$79.43/barrel, gold is up almost half a percent at US$1963/ounce, and iron ore is down 0.43% at US$115.50/tonne.
- Locally today, Australia’s inflation data for Q2 is out just before midday which may cause some market movements pending on how the data reads. If the reading comes in, in-line with consensus expectations of a decline in the annual inflation rate to 6.2%, we could see the market rally in anticipation of rate pauses to come, however if inflation remains around 7% or higher than expected.
- AU$1.00 is buying US$0.68, 95.68 Japanese Yen, 52.36 British Pence and NZ1.09.
Trading Ideas:
- Bell Potter has increased the price target on Mader Group (ASX:MAD) from $5.10 to $6.10 and maintain a hold rating on the leading provider of specialised labour services, following the release of the company’s Q4 results including a 12th consecutive quarter of revenue growth, underpinned by growth across Australian operations and reflecting robust demand for Mader’s core mechanical services and new vertical service offerings, as well as North American penetration and growth in Canada.
- And Trading Central has identified a bullish signal on BHP Group (ASX:BHP) following the formation of a pattern over a period of 59-days which is roughly the same amount of time the share price may rise from the close of $45.82 to the range of $50-51 according to standard principles of technical analysis.
US equities had a positive run overnight, with all three major benchmarks closing the session in the green, as a busy week of earnings season begins and as investors await the Fed’s next policy decision.
The Dow Jones pisted its 11th straight day of gains, advancing 0.52%. The S&P500 also gained as energy stocks led the index, with the sector up almost % after gas and oil futures approached a three-month high. And the tech-heavy Nasdaq added 0.2%, as investors await the earnings report from some big tech names. Companies set to report this week include Alphabet, Microsoft, and Meta.
In Europe, Germany’s DAX, the FTSE 100 and the STOXX 600 all closed in the green, while France’s CAC was the only benchmarks to close lower. It’s a busy week ahead for central bank meetings in Europe, as well as corporate earnings and the inconclusive results of the Spanish election, which were held on Sunday.
What to watch today:
- Following Wall Street overnight, the SPI futures are suggesting that our local market is set to rise 0.56% at the open this morning.
- There is no local economic data out today, markets are waiting for the inflation rate announcement out tomorrow.
- Stocks to watch today include gold miner Newcrest Mining (ASX:NCM), which is set to release its quarterly report today. And Blackmores (ASX:BKL) which is set to go ex-dividend today. So remember that this often sees the share price fall, as investors take their profits.
- Looking now at commodities,
- Crude oil is jumped 2.4% and is current trading at around US$78.91 per barrel. The price is at a three-month high amid an outlook for tighter global supply, as well as an increase in Chinese demand. So keep watch of energy producers today including Woodside Energy (ASX:WDS), Santos (ASX:STO) or Ampol (ASX:ALD).
- The price of gold is slightly lower as investors await the rate decisions from central banks this week.
- And iron ore is hovering around a three-month high as investors assess the likelihood that the Chinese government will provide stimulus to boost resource demand and the country’s economic outlook.
Trading Ideas:
- Bell Potter maintains its BUY rating on Life360 (ASX:360) a market leading family app with driving safety and location sharing features. 360 is scheduled to report its second quarter results mid-August, and Bell Potter are expecting solid results. However, there are areas they’re not expecting strong results, with factors in consideration such as price rises for Android users in the US. They have increased their price target from $9.00 to $9.25, and at 360’s current share price of $7.82, this implies 18.3% share price growth in a year.
- And Trading Central have identified a bullish of signal on Whitehaven Coal (ASX:WHC), indicating that the stock price may rise from the close of $7.23 to the range of $8.50 to $8.80 over 38 days according to the standard principles of technical analysis.
It was a mixed session in the US on Friday as investors digested the latest slew of earnings results and the Dow Jones extended its rally to 10 sessions, the longest for the key index since 2017. American Express shares slipped around 4% on Friday after the company reported second quarter revenue of US$15.05bn which fell short of analysts’ expectations at US$15.48bn.
Corporate earnings so far have been mixed with 75% of S&P500 companies that have reported, exceeding analysts expectations according to FactSet. For the week, the Dow Jones rose 2.08%, the S&P500 added 0.7% and the tech-heavy Nasdaq fell 0.57% over the 5 trading days.
Over in Europe on Friday, a results-driven rally fuelled markets to close higher in the region as investors responded to key corporate earnings results released. UK retail sales data for June was released on Friday coming in at a rise of 0.7% month-on-month, in a sign UK consumer spend remains resilient despite rising inflation and interest rates. Swiss miner Glencore released results on Friday including profits around US$4bn as the commodity market continues to normalise after a particularly strong 2022.
Europe’s earnings season ramps up into full swing this week with key Pharmaceuticals, banks and automotive companies releasing results. On Friday the STOXX600 rose 0.3%, Germany’s DAX fell 0.17%, the French CAC rose 0.65%, and, in the UK, the FTSE100 rose 0.23%.
Locally on Friday, the ASX200 closed the last trading session of the week down 0.15%, weighed down by a 2.73% sell-off in the technology sector while energy stocks offset some of the heavy losses, closing up 1.3% at the session’s end. The local tech sell-off followed a slide in the Nasdaq on Wall St on the back of a disappointing revenue forecast out of Netflix and Tesla reporting a drop in tis gross margins.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open the new trading week up 0.4%.
- Looking at commodities this morning, oil is trading almost half a percent lower at US$76.75/barrel, coal is up 0.76% at US$133/tonne, gold is up 0.04% at US$1962.57/ounce and iron ore is down 0.85% at US$116/tonne.
- AU$1.00 is buying US$0.67, 95.42 Japanese Yen, 52.36 British Pence and NZ$1.09.
- This week we may see some market movements following the release of key economic data including Australia’s annual inflation rate data for Q2 out on Wednesday with consensus expecting a fall from 7% in Q1 to 6.2% in Q2.
- Overseas, the US interest rate decision is out on Thursday with the expectation of the Fed’s to announce a 25-basis point rate hike, which will take the cash rate in the US to 5.5%.
Trading Ideas:
- Bell Potter has decreased the price target on Coronado Global Resources (ASX:CRN) from $2.15/share to $2/share and maintain a buy rating on the coal miner and producer following the release of the June trading update including quarterly saleable coal production of 4.5 million tonnes and sales volume of 4 million tonnes. This was an improvement on the prior weather impacted quarter however revenue fell 5% quarter-on-quarter driven by lower index and realised prices. Net cash for the company also fell from US$256m to US$192m over the quarter, and Bell Potter expects a lift in second half production and CAPEX which are the factors contributing to the price target decline to $2/share.
- And Trading Central has identified a bullish signal on GrainCorp (ASX:GNC) following the formation of a pattern over a period of 180-days which is roughly the same amount of time the share price may rise from the close of $8.12 to the range of $9.60 to $10 according to standard principles of technical analysis.
Incorporating environmental, social and governance (ESG) factors into investment decision-making has been a growing interest for investors and companies. An ESG criteria evaluates a company’s sustainability and ethical impact and has had a notable impact on the share market by navigating investor preferences and capital allocation.
In this week’s wrap, Grady covers:
- (0:10) The importance of ESG goals for corporations
- (0:51) Companies kicking goals on the ESG front
- (2:21) The beginning of earnings season
- (3:48) Best performing stocks in the ASX200
- (5:04) The most traded stocks & ETFs by Bell Direct clients
- (5:38) Three economic news items to watch out for
US equities closed mixed in New York overnight. The Dow Jones gained more than 100 points or 0.47% to notch its first 9-day rally since 2017. A rally came after better-than-expected results from Johnson and Johnson. However, the broader market suffered after post-earnings declines in trader favourites Netflix and Tesla. The S&P500 slipped 0.7%, while the Nasdaq tumbled more than 2%.
What to watch today:
- The SPI futures are suggesting that our local market will rise 0.08% at the open this morning.
- In commodities,
- Crude oil is up 0.6%, approaching US$76 per barrel, after facing heightened volatility in recent sessions, as investors continued to weigh outlook for the oil market for the rest of this year.
- Gold is hovering at its strongest levels in two months as easing US inflation raised hopes that the Federal Reserve is close to the end of its current monetary policy tightening cycle. So keep watch of ASX gold miners today.
- And iron ore is currently trading flat, hovering close to a three-month high at US$116.50 per tonne, as markets continued to weigh on Chinese resource demand. So also keep watch of iron ore miners, including Grange Resources (ASX:GRR), Mineral Resources (ASX:MIN) and Fortescue Metals (ASX:FMG).
- Companies to watch today include Atlas Arteria Group (ASX:ALX) and Coronado Global Resources (ASX:CRN), both set to release quarterly reports today.
Trading Ideas:
- Bell Potter maintains its Speculative Buy rating on Pentanet (ASX:5GG). The telecommunications carrier and cloud gaming provider released a Q4 update with FY23 revenue and gross profit growth in line with Bell Potters expectations. They have upgraded their valuation to $0.14 on improving cost performance. At 5GG’s current share price of $0.09, this implies 42.9% share price growth in a year.
- And Bell Potter also maintains a Buy rating on Select Harvest (ASX:SHV) and maintain their $5.50 price target, which implies 31% share price growth in a year.
It was a positive run in New York overnight, with all three major benchmarks closing in the green, as the corporate earnings season continued. The Dow Jones registered its eighth straight day of gains, its longest winning streak since September 2019.
Goldman Sachs reported in the US, announcing a miss on profit and a beat on revenue, while Netflix, Tesla, IBM, and United Airlines reported after the close. Netflix shares tumbled after reporting quarterly results, saying it was too early to assess the effects of its crackdown on its password sharing and revenue from the ad-supported offering. Tesla shares fluctuated near the flatline after reporting record-high quarterly revenue, while United Airlines jumped after revenue topped analysts’ expectations.
What to watch today:
- Our local market is set to open higher, with the SPI futures suggesting a slight rise of 0.03%.
- Ahead of reporting season, that kicks off every soon, some companies are releasing their quarterly results, before their full year results are announced in August. Keep watch of the following quarterly reports out today, including BHP Group (ASX:BHP), Alumina (ASX:AWC), Evolution Mining (ASX:EVN) and Santos (ASX:STO). Also today, companies announcing their full year results are Zip Co (ASX:ZIP) and Telix Pharmaceuticals (ASX:TLX). And Bell Potter have updated their report on TLX – so more on that a little later.
- In economic news, the unemployment rate for June will be announced today at 11:30am AEST, expected to remain unchanged a 3.6%.
- And looking at commodities now,
- Crude oil is trading at around US$75 per barrel, as investors weigh demand concerns, China’s announcement to support economic growth, as well as signs of tightening global oil supplies.
- Gold is lower, hovering near its strongest levels in two months, amid weakness in the US dollar.
- While iron ore is up 0.9%, trading at US$116.50 per barrel, hovering close to the three-month high. Iron ore markets continue to weigh on Chinese resource demand as the likelihood of government stimulus for the construction industry.
Trading Ideas:
- Bell Potter maintains a Buy rating on Telix Pharmaceuticals (ASX:TLX). The group specialises in the development and commercialisation of radiopharmaceuticals for imaging and treatment of certain cancers. They reported Q2 cash flows with revenue growth of 20.6% compared to the previous quarter, in line with Bell Potter’s expectations. FY23 EBITDA is lowered by approximately $14 million (down 13%), as Bell Potter reduce their gross margin assumption to 64%. The price target remains unchanged at $14.00, and at TLX’s current share price of $12.16, this implies 15.1% share price growth in a year.
- And Trading Central have identified a bullish signal in oOh Media (ASX:OML), indicating that the stock price may rise from the close of $1.33 to the range of $1.45 to $1.49 over 38 days, according to the standard principles of technical analysis.
US equities rallied on Tuesday with the Dow Jones closing higher for a 7th straight session, on the back of stronger-than-expected earnings results. Bank of America shares rose 4.2% after it reported earnings above expectations for the second quarter thanks to higher interest rates, while Morgan Stanley added 6.2% after a beat on both revenue and adjusted earnings per share. The Dow Jones closed up 1.06%, the S&P500 added 0.71% and the tech-heavy Nasdaq ended Tuesday’s session up 0.76%.
In Europe overnight, markets rallied as investors in the region assess earnings results out of both local and US corporations.
The local share market fell 0.2% yesterday as investor sentiment was dampened by the release of the RBA’s latest meeting minutes whereby the prospect of more rate rises was outlined, if inflation in Australia doesn’t fall to the target range. This naturally caused investors to sell out of REIT stocks yesterday as rising interest rates devalues the properties owned by REIT companies and raises the costs associated with running the REIT assets.
Retailers took a big hit again yesterday as investor fears of rate hikes hit the consumer discretionary sector, which traditionally feels the full brunt of interest rate hikes in the form of higher costs and lowered demand. The big four banks all rallied yesterday though which offset some of the heavy losses for consumer discretionary and mining stocks.
Shares in manufacturing company Ansell tanked over 14% on Tuesday as investors responded to the company’s trading update outlining guidance for both FY23 and FY24 and the outlook for higher costs in FY24. The company’s guidance outlined the expectation for Industrial GBU sales for FY23 to have fallen over $12.5m from FY22, while organic growth was achieved in both Mechanical and Chemical divisions. Healthcare GBU sales were also down over $200m from FY22.
China’s GDP for Q2 out on Monday came in at growth of 6.3% for the quarter which fell short of economists’ expectations and provided a further sign of the weak post-pandemic recovery out of the world’s second largest economy.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open 0.54% higher following the global results-driven rally overnight.
- On the commodities front this morning, oil has rebounded from lows earlier in the week to trade 2.06% higher at US$75.68/barrel, gold is up 1.13% at US$1976.76/ounce and iron ore is down 1.28% at US$115.50/tonne.
- On the economic calendar today, the annual UK’s inflation rate data for June is out this afternoon with the market expecting a slight decrease to 8.2% from 8.7% in May.
- AU$1.00 is buying US$0.68, 94.58 Japanese Yen, 52.12 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Cyclopharm (ASX:CYC) and maintain a buy rating on the healthcare company following the release of a trading update outlining revenues of $15.3m for the first half of FY23 comprising around $7.5m in Technegas revenues and the remaining $7.8m from 3rd party distribution sales. Cyclopharm is also on watch in the lead up to the FDA inspection of the Kingsgrove manufacturing facility ahead of the FDA approval decision expected on 29th September.
- And Trading Central has identified a bearish signal on Dicker Data (ASX:DDR) following the formation of a pattern over a period of 90-days which is roughly the same amount of time the share price may fall from the close of $7.96 to the range of $6.60 to $6.90 according to standard principles of technical analysis.
In this instalment of our From the helm series, Bell Direct’s Grady Wulff speaks to DroneShield's (ASX:DRO) Managing Director and CEO, Oleg Vornik.
DroneShield is making waves in the capital goods industry through the use of artificial intelligence and machine learning. The company is an Australia defence manufacturer specialising in counter-drone technology, servicing military and intelligence, law enforcement, critical infrastructure and commercial parties globally.
In this video Oleg discusses:
- (1:05) DroneShield's recent contract worth $9.9 million
- (3:00) The company's mid-year performance
- (3:55) The role they play in combating rising geopolitical tensions
- (5:49) AI's role in DroneShield
- (7:15) The Australian Defence Review's impact
- (8:22) DroneShield's outlook and future plans
Note: This interview was filmed on 5 July 2023
US equities closed higher on Monday as investor sentiment remains boosted by favourable inflation data released last week alongside some strong second quarter results released at the start of earnings season so far.
The Dow Jones closed higher for a 6th straight session, adding 0.22% at the closing bell on Monday, while the S&P500 rose 0.39% and the tech-heavy Nasdaq added 0.93% boosted by Apple and Tesla rising 1.7% and 3.2% respectively.
While Wall St is expecting a gloomy reporting season, the risk of recession is easing as predicted by Goldman Sachs and a number of economists given recent data out in the US reinforced confidence that the Fed’s aggressive rate hikes will be able to cool inflation without plunging the US into a recession.
Over in Europe, markets closed lower on Monday following the release of China’s GDP data coming in at growth of 6.3% for Q2 which fell short of economists’ expectations and provides a further sign of the weak post-pandemic recovery out of the world’s second largest economy. Earnings season in Europe also ramps up this week with Novartis and Ocado releasing results this week. The STOXX600 fell 0.6% on Monday while Germany’s DAX fell 0.23%, the French CAC lost 1.12% and, in the UK, the FTSE100 fell 0.38%.
Locally yesterday the ASX started the week in negative territory, down 0.06% at the closing bell, weighed down by a sharp selloff in energy stocks, which was slightly offset by a 0.88% rise for the technology sector. Energy stocks were likely sold off amid China’s GDP data coming in weaker than expected which contributed to a 1.75% decline in the price of oil to trade at US$74.10/barrel.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open Tuesday’s session down 0.28%.
- Oil remains at US$74.10/barrel this morning, coal is up 2.85% at US$131.65/tonne, gold is up just 0.01% at US$1955/ounce, and iron ore is up 4% at US$117/tonne.
- On the economic calendar today, we may see the local markets move following the release of the RBA’s meeting minutes this morning pending how investors interpret the outlook for coming months of rate decisions.
- US retail sales data for June is also out this evening, with consensus expecting a 0.5% rise for the month which would provide another sign that the US economy remains resilient despite rising interest rates.
- AU$1.00 is buying US$0.68, 94.56 Japanese Yen, 52.10 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Neuren (ASX:NEU) from $16.50 to $17 and maintain a buy rating on the pharmaceuticals company following the release of Neuren’s US partner, Acadia Pharmaceuticals Q2 sales of Daybue, which is Neuren’s Trofinetide drug in the US. The report came in at sales of US$21m-$23m and provided guidance for Q3 of US$45m - $55m – a significant beat of analysts’ expectations. The increase in price target is also on the back of Acadia Pharmaceuticals strengthening its licencing agreement with Neuren to a global scale, not just in the US moving forward.
- And Bell Potter has increased the price target on DroneShield (ASX:DRO) from 40 cps to 45 cps and maintain a buy rating on the defence technology company following the announcement out of DroneShield yesterday that it has won a record US$33m contract with the US government for DroneShield equipment and multi-year services subscriptions.
Wall Street closed mixed on Friday as earnings season kicked off in the US with a few big names posting better-than-expected results. This reporting period is particularly important in the eye of investors as to see how well US companies have performed during the high inflation, high interest rate environment. The Dow Jones rose 0.33%, while the S&P500 fell 0.1% and the tech-heavy Nasdaq lost 0.18% on Friday. For the week though, the three key indices posted gains with the Dow Jones adding 2.3%, the S&P rising 2.4% and the Nasdaq adding 3.3%.
UnitedHealth shares jumped more than 7% on Friday after the insurance company reported better-than-expected adjusted earnings and revenue for the first half. JPMorgan Chase also rose 0.6% after the big bank’s second quarter earnings also topped expectations.
Over in Europe, markets ended a 5-session winning streak on Friday with most closing lower, weighed down by sell-offs in oil and gas, and mining stocks. Investors had last week been assessed data out of the UK indicating wages grew by 7.3% in the three months to May, which is a significant concern for the Bank of England as it tackles the worst inflation among the group of seven nations including the US, Canada and France among others. The STOXX600 lost 0.1% on Friday, Germany’s DAX fell 0.22%, the French CAC added 0.06%, and in the UK, the FTSE100 fell 0.08%.
Locally on Friday, the key index rose 0.78% driven by a rally for technology stocks with the sector adding 1.68%, while communication services and materials stocks also had a strong session with each adding 1.66% and 1.35% respectively.
Telix Pharmaceuticals (ASX:TLX) rose 5.33% on Friday despite no price sensitive news out of the company on Friday, while Netwealth Group (ASX:NWL) fell 5.4% likely due to investors taking profits following the release of the company’s quarterly update including a record level of funds under administration.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open 0.03% lower.
- On the commodities front this morning oil is trading 0.67% lower at US$74.91/barrel, uranium is down 0.45% at US$55.40/pound, gold is down 0.3% at US$1954/ounce and iron ore is up 4% at US$117/tonne.
- AU$1.00 is buying US$0.68, 94.88 Japanese Yen, 52.46 British Pence, NZ$1.07.
Trading Ideas:
- Bell Potter has decreased the 12-month price target on RMA Global (ASX:RMY) from 21 cps to 18 cps and maintain a speculative buy rating on the emerging digital marketing business for real estate agents, following the release of the company’s Q4 update for FY23 including US claimed profiles growing to 259K, US reviews increasing to 722K, and subscription revenue of $3.6m. The reason for the decrease in price target is due to the Bell Potter analyst expecting US subscriber volumes to moderate due to the ongoing heightened interest rate environment.
- And Trading Central has identified a bullish signal on Woodside Energy (ASX:WDS) following the formation of a pattern over a period of 272 days which is roughly the same amount of time the share price may rise from the close of $36.28 to the range of $45.00 to $47.00 according to standard principles of technical analysis.
The Australian share market staged an upswing this week, advancing 2.91% (Mon – Thurs). The ASX200 leader board was painted green, with information technology posting the strongest gains, followed by real estate and materials.
In this week's wrap, Grady covers:
(0:58) The REITs that are thriving vs. those that are struggling
(3:38) One REIT that is trading at a discount in 2023
(4.46) Best performing stocks in the ASX200
(5:38) The most traded stocks & ETFs by Bell Direct clients
(6:15) Three economic news items to watch out for
European and US markets rallied overnight after US PPI data came in lighter than expected. This built on optimism after US CPI on Wednesday was also less than anticipated. The data supports signs that inflation is cooling, therefore boosted economic sentiment, and raising hopes of a less aggressive path ahead. However, markets are still expecting a 25-basis point rise by the Fed this month. It was the fourth consecutive day of gains for the major averages, with the Dow Jones added 47 points or 0.14%. The S&P500 closed 0.85% higher, while the tech-heavy Nasdaq advanced 1.58%.
European markets also closed higher after the US inflation reading, as well as a drop in UK gross domestic product. UK GDP pulled back slightly, amid the focus on ongoing inflation, particularly after strong wage growth data was announced this week.
What to watch today:
- Our local market is set for a positive start, following the US overnight, with the SPI futures suggesting a 0.61% rise at the open this morning.
- Looking at commodities,
- Crude oil is trading higher as OPEC maintain a positive outlook on world oil demand, raising its growth forecast for 2023 and predicting a slight slowdown in 2024. This is driven by strong fuel consumption in China and India.
- Gold is slightly in the green, holding at its highest level in one month, as renewed evidence of softer inflation has boosted sentiment. So watch gold miners today.
- And iron ore is strong, trading 1.83% higher at US$111.50 per tonne, sharply rebounding from a one-month low, amid hopes of strong demand. China’s hot metal production averaged 2.5 million tonnes per day in June, which was the highest level since October 2020, therefore suggesting that steel mills in are returning to full capacity in China, the world’s top iron ore consumer. So keep watch of iron ore stocks today including Fortescue Metals (ASX:FMG), Rio Tinto (ASX:RIO) or BHP (ASX:BHP).
Trading Ideas:
- Bell Potter maintains a Speculative Buy rating on Pharmaxis (ASX:PXS) and value the drug developer at $0.10. At PXS’s current share price of $0.05, this implies 96.1% share price growth in a year.
- And Trading Central have identified a bullish signal in Northern Star Resources (ASX:NST) indicating that the stock price may rise from the close of $13.14 to the range of $13.55 to $13.70 over 15 days, according to the standard principles of technical analysis.
US equities hit a 15-month high on Wednesday after CPI data came in lower than expected, which boosted investor sentiment. The annual inflation rate in the US slowed to 3% in June, the lowest level since March 2021, down from 4% in May and also below the consensus expectation of 3.1% in a sign the Federal Reserve’s hawkish stance on hiking rates is having a significant impact on cooling inflation. The Dow Jones rose 0.25% on Wednesday, the S&P500 added 0.74%, and the tech-heavy Nasdaq did most of the heavy lifting with the index rising 1.15% at the closing bell.
Despite inflation falling, the market is still expecting the Fed to announce another 25-basis point rate hike at the next FOMC meeting as wages inflation, services inflation and housing inflation, despite moderating, are still stubbornly high.
Over in Europe, markets in the region also had a strong rally on Wednesday as investor sentiment was boosted by inflation cooling in the US. The STOXX600 rose 1.5%, Germany’s DAX added 1.47%, the French CAC rose 1.57%, and in the UK, the FTSE100 surged 1.83%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open Thursday’s session up 0.87% following the inflation-data driven rally in the US overnight.
- Locally yesterday, the ASX lifted 0.38% buoyed by a near 2% rise for the energy sector as oil is trading 1.36% higher and up 5.65% over the last week following speculation that China may move to introduce further policy to stimulate its economy through the sluggish post-pandemic recovery.
- Gold miners also extended their recent rally into the midweek session on strength in the price of the commodity while the worst performing sectors yesterday were information technology and health care.
- On the commodities front this morning, oil is trading 1.34% higher at US$75.83/barrel, gold is up 1.32% at US$1957.57/ounce and iron ore is up 1.39% at US$109.50/tonne.
- AU$1.00 is buying US$0.68 cents, 93.96 Japanese Yen, 51.97 British Pence and NZ1.08.
Trading Ideas:
- Bell Potter has initiated coverage of Smartpay Holdings (ASX:SMP) with a buy rating and a 12-month price target of $2.16/share amid terminal growth outlook from Bell Potter’s analyst. Smartpay is a full-service provider of end-to-end payment solutions and the Bell Potter analyst sees SMP has considerable uplift to gross profit and margins from implies revenue per unit as the company expands its Australian customer base.
- And Trading Central has identified a bearish signal on NIB Holdings (ASX:NHF) following the formation of a pattern over a period of 11-days which is roughly the same amount of time the share price may fall from the close of $8.43 to $7.80 to $7.90 according to standard principles of technical analysis.
Wall Street rallied on Tuesday as all eyes focus on the release of US inflation data out at 10:30pm tonight Australian Eastern Standard time while investors also welcomed comments from Federal Reserve officials earlier today suggesting US interest rates may be nearing their peak.
Salesforce shares rose 0.6% after the company said it would increase prices across the board in August, while American video game company Activision Blizzard jumped over 10% after a Federal Judge denied the Federal Trade Commission’s request for a preliminary injunction to stop Microsoft acquiring the video game maker, meaning the two companies are closer to completing their acquisition deal.
In Europe, markets closed higher in the region led by a boost for mining and construction stocks. The STOXX600 finished Tuesday’s session up 0.7%, Germany’s DAX rose 0.75%, the French CAC added 1.07% and, in the UK, the FTSE100 rose 0.12%.
On the back of weak inflation data being released earlier this week, China signalled more economic support measures are coming through the adoption of more property supportive policies in addition to measures aimed at boosting business confidence, as per reports out of Bloomberg.
Locally, gold and lithium miners advanced yesterday with lithium miners boosted by Patriot Battery Metals (ASX:PMT) soaring over 7% on speculation of the company being a takeover target, while gold rallied on strength in the price of the precious commodity.
The ASX rose 1.5% yesterday with every sector of the ASX closing in positive territory, led by the 2023 favourite sector, information technology, surging 2.41%. The local rally yesterday was spurred on by strength in the US on Monday in addition to the release of positive economic data which boosted investor sentiment.
Westpac consumer confidence data and NAB business confidence data were released yesterday with both coming in on the upside. Westpac consumer confidence rose 2.7% from 0.2% in June in a sign consumers are optimistic about the month ahead, possibly on the back of the rate pause out of the RBA. While, NAB business confidence data for June hit zero, up from -4 in May, indicating business confidence is also rising following months of tougher business conditions.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the local index to open the midweek session half a percent higher following the strength in both European and the US markets overnight.
- On the commodities front this morning, oil is trading 2.38% higher at US$74.73/barrel, gold is up 0.33% at US$1931.34/ounce and iron ore is down 4% at US$108/tonne in the wake of weak economic data out of China earlier in the week.
- AU$1.00 is buying US$0.67, 93.73 Japanese Yen, 52.02 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Janus Henderson (ASX:JHG) from $41.29 to $42.64 and maintain a hold rating on the global asset management company ahead of the release of the company’s H1 results on August 1st with Bell Potter expecting to see an uptick in funds under management by around 2.8% to US$319.4bn and expect Janus Henderson to produce Adjusted operating income of US$118.9m up from US$105.6m in Q1. These expected upticks are on the back of stronger US and European markets in Q2 while government bond returns were slightly negative.
- And Trading Central has identified a bullish signal on Ramelius Resources (ASX:RMS) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $1.30 to the range of $1.51 to $1.57 according to standard principles of technical analysis.
It was a positive session in New York overnight, as all three major averages snapped a three-day decline. Shares were broadly higher with the Dow Jones closing 0.6% higher, while the S&P500 and the Nasdaq gained 0.2%. Industrials led seven of the eleven S&P500 industry sectors higher as the closing bell neared, while communication services led the decliners.
And markets are waiting for US inflation data out tomorrow night is expected to show a modest decline of an annual rate of 4% in May to 3.1%.
What to watch today:
- The Australian market is set to open higher this morning, with the SPI futures suggesting a 0.62% rise at the open.
- In economic data, today Westpac will release its data on consumer confidence and NAB will release its data on business confidence. Both are expected to announce an increase in confidence month-on-month.
- Looking at commodities,
- Crude oil has fallen, trading at around US$73 per barrel as concerns about a global economic slowdown that could reduce demand for oil outweighed the prospects of tighter global supplies from Saudi Arabia and Russia.
- Gold is trading flat, as investors weigh the prospects of further monetary tightening against concerns about a global economic slowdown, while poor performance of China’s consumer and producer prices reduced confidence of a recovery and increased deflation risks.
- And iron ore continued to drop towards US$100 per tonne, so keep watch of iron ore stocks today including Fortescue Metals (ASX:FMG), Rio Tinto (ASX:RIO) or Mineral Resources (ASX:MIN).
Trading Ideas:
- Bell Potter maintains a Buy rating on Propel Funeral Partners (ASX:PFP) after the company announced two acquisitions in New Zealand at AU$38 million. They have decreased their price target by approximately 5% to $5.60 per share, and at PFP’s current share price of $4.11 this implies 36% share price growth in a year.
- Bell Potter also maintains their Buy rating on Vitura Health (ASX:VIT) and they believe the company has solidified its position as market leader in medicinal cannabis distribution. Their price target remains unchanged at $0.90, and at VIT’s current share price of $0.54 this implies 66.7% share price growth in a year.
Investor fears of further rate hikes in the US sparked a sell-off in US equities on Friday despite favourable jobs data being released. The US Labour Department’s June jobs report revealed payrolls increased less than expected by 209,000 for the month following an addition of 306,000 in May, in a sign the tight labour market in the US is continuing to ease. The US unemployment rate came in at 3.6%, down from 3.7% in May. Despite the favourable jobs data, the three key indices posted losses for the week as investors digested the latest FOMC meeting minutes with concerns the Fed will begin raising rates again as soon as the end of this month. The Dow Jones fell 1.16% over the week, while the S&P500 lost almost 2% and the tech-heavy Nasdaq declined 0.92% from Monday to Friday.
Over in Europe, markets edged slightly higher on Friday following the release of the favourable US jobs report. Germany’s DAX rose almost half a percent, the French CAC added 0.42%, while in the UK, the FTSE100 fell 0.32% weighed down by OSB Group as the British financial services provider tanked 28% after the company said it expects net income to drop by up to 180 million pounds or $230m as mortgage customers move away from high-rate products.
Locally on Friday the ASX tumbled 1.69% on Friday as every sector closed the last trading session of the week in negative territory, with REIT stocks taking the biggest hit as the sector closed 2.6% lower. The ASX sell-off on Friday was sparked by investor concerns of a robust jobs report out of the US, which was released after our local closing bell and came in quite the opposite to what local investors had been expecting.
What to watch today:
- With the favourable jobs report in mind, the SPI futures are anticipating the local index to open Monday’s session on a much brighter note, up 0.36% to start the new trading week on a positive note.
- On the commodities front this morning, oil is trading 0.32% lower this morning at US$73.57/barrel, uranium is down almost 1% at US$55.65/pound, gold is up 0.15% at 1927.93/ounce, and iron ore is down 0.88% at US$112.50/tonne.
- Taking a look on the economic calendar, China’s highly anticipated annual inflation rate data for June is out today with consensus expecting a rise to 0.2% from 0.1% in May, as the economy continues its struggle to rebound on the growth front post the end of lengthy pandemic restrictions easing.
- AU$1.00 is buying US$0.67, 95.18 Japanese Yen, 51.94 British Pence and NZ$1.08.
- Shares trading ex-dividend today include Collins Foods (ASX:CKF), Red Hill Minerals (ASX:RHI), and Turners Automotive Group (ASX:TRA). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has decreased the price target on Clarity Pharmaceuticals (ASX:CU6) from $1.40 to $1.30 and maintain a speculative buy rating on the healthcare equipment and services company following the company announcing that it will commence a phase three trial of its diagnostic agent in prostate cancer, targeting high risk prostate cancer patients prior to prostatectomy. There is currently no marketed MTR products for this indication hence according to the Bell Potter analyst, if the trial meets the primary endpoints of sensitivity and specificity, the product will become highly differentiated from its peers.
- And Trading Central has identified a bearish signal on Wesfarmers (ASX:WES) following the formation of a pattern over a period of 110 days which is roughly the same amount of time the share price may fall from the close of $47.09 to the range of $41.50 to $42.50 according to standard principles of technical analysis.
The Aussie share market fell 0.55% this week (Mon-Thu) weighed down by the healthcare sector losing 1.7%, information technology stocks falling 1.66% and the materials sector falling 0.82%. Market volatility was driven this week by outlook for future rate hikes out of the RBA and Federal Reserve alongside recessionary concerns amid signs of slowing economic growth.
In this week's wrap, Grady covers:
- (0:11) The IPOs landscape
- (0:54) The most successful & worst performing IPO in 2023
- (2:15) Why IPOs are a no-go in 2023
- (3:51) Key things to consider when investing in IPOs
- (4:45) Best performing stocks in the ASX200
- (5:46) The most traded stocks & ETFs by Bell Direct clients
- (6:21) Three economic news items to watch out for
Read the article transcript here.
On Wall Street overnight, US equities closed in the red, with all three major benchmarks declining. This was after better-than-expected jobs data out in the US, raised concerns around the state of the economy and the path of interest rates. The S&P500 dropped 0.8% with all 11 industry sectors lower. Energy was down the most, while information technology was the best performer. The Dow Jones dropped more than 1%, marking the worst daily performance for the Dow and the S&P 500 since May. And the Nasdaq closed 0.8% lower. And the 2-year US Treasury yield hit a 16-year high.
European markets also sharply fell. The STOXX 600 tumbled 2.3%, again of the back of the US jobs report. Travel and leisure led the losses, followed by retail.
What to watch today:
- Australian shares are set to sharply drop in line with losses across Europe and the US overnight. The SPI futures are suggesting a 1.26% fall at the open this morning.
- In commodities,
- Crude oil is in the green, regaining earlier losses after falling to as low as US$70, as growing concerns about a global economic slowdown and lower demand offset concerns over tight supply.
- UK natural gas has dropped over 5%, extending its decline as markets assessed expectations of firm supply against rising demand.
- Gold is at its lowest in nearly four months as evidence that the labour market remains tight strengthened the case for a hawkish Federal Reserve, which increased the opportunity cost to hold precious metals. So keep watch of gold miners such as Newcrest Mining (ASX:NCM) and Evolution Mining (ASX:EVN).
- And iron ore remains close to a two-month high.
Trading Ideas:
- Bell Potter maintains a Buy rating on Regal Partners (ASX:RPL), with the company expected to update the market on mid-year funds under management in mid/late July. They have increased their price target from $3.71 to $3.45, and at RPL’s current share price of $2.58 this implies 33.7% share price growth in a year.
- And Trading Central has identified a bearish signal in OFX Group (ASX:OFX) indicating that the stock price may fall from the close of $1.90 to the range of $1.35 to $1.45 over 34 days, according to the standard principles of technical analysis.
The release of the Federal Reserve’s meeting minutes sent Wall Street into sell-mode on Wednesday in this shortened trading week as investors digested the minutes including the outlook for further tightening of monetary policy. Also adding to the negative sentiment on Wall St was data released on Wednesday morning showing factory orders were weaker than expected in May. Investor sentiment may also waver later in the week when a batch of employment data is released which will enable insights into the strength and tightness of the US labour market to date. The Dow Jones fell 0.38% on Wednesday while the S&P500 lost 0.2% and the Nasdaq dropped 0.18%.
Over in Europe, markets in the region closed lower on Wednesday as investors shifted focus back to weakening global growth outlook and recessionary concerns. PMI figures for June in the eurozone showed business output for the month contracted as services growth eased despite easing inflationary pressures. This combined with China’s service sector activity also slowing considerably has investors worried about slowing global economic growth. The STOXX600 fell 0.7%, Germany’s DAX lost 0.63%, the French CAC fell 0.8%, and in the UK, the FTSE100 fell 1.03%.
The RBA rate pause-driven rally of yesterday was very short-lived as the key index closed 0.35% lower on Wednesday. The ASX traded in negative territory for almost all of yesterday’s session weighed down by sharp losses for financial, healthcare and energy stocks, while Telecommunications and Utilities stocks offset some of the heavy losses on the market yesterday. CSL weighed down the healthcare sector yesterday with the biotech giant losing 0.63% yesterday, while AMP took the biggest hit on the ASX200 yesterday losing over 6% before entering a trading halt as the Federal Court in Victoria ruled in favour of claimants against AMP in a class action known as the ‘buyer of last resort’ proceedings.
The winning stocks on the ASX200 yesterday were Elders (ASX:ELD) adding 4.8%, Bellevue Gold (ASX:BGL) lifting 4.09% and Seek (ASX:SEK) rising 3.9%. And on the losing end aside from AMP (ASX:AMP), Netwealth Group (ASX:NWL) fell 3.8% and Telix Pharmaceuticals (ASX:TLX) lost 3.4%.
Overseas, China’s latest Caixin manufacturing data released yesterday for June came in at 53.9 points which fell short the forecasted 56.5 points and is a sharp decline from the 57.1 points recorded in May, adding further concerns around China’s overall economic recovery post-pandemic.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the local index to open 0.51% lower following the global market sell-off overnight.
- AU$1.00 is buying US$0.67 cents, 96.28 Japanese Yen, 52.63 British Pence and NZ$1.08 dollar.
Trading Ideas:
- Bell Potter has increased the 12-month price target on Nanosonics (ASX:NAN) from $3.90 to $4.15 and maintain a sell rating on the healthcare equipment and services company following a site visit to the company’s US headquarters in Indianapolis, where the US accounts for around 90% of group revenues. The key learning from the Bell Potter team visit was that Nanosonics’ Trophon 2 device remains under penetrated in many clients, in particular amongst former GE clients. Bell Potter maintains a sell rating as they believe this stock is full priced, however increase the price target based on revenue for FY23 likely to be at the top end of guidance around 41% and gross margin in the range of 77-79%.
- And Trading Central has identified a bullish signal on Beacon Lighting (ASX:BLX) following the formation of a pattern over a period of 30 days which is roughly the same amount of time the share price may rise from the close of $1.74 to the range of $1.94 to $2.00 according to standard principles of technical analysis.
It was good news for all mortgage holders on the interest rate yesterday with the RBA announcing a rate pause for July at the latest RBA meeting. The local market see-sawed before the RBA rate announcement with the nation’s cash rate remaining at 4.1% for the month of ahead. Growth in Australia’s economy has slowed, the labour market tightness has begun to show signs of easing, consumer spend is decreasing, but wages growth is still the one sticky inflation driver that remains strong.
The CPI figures for May were a key indicator for the RBA’s pause, with inflation down under falling to 5.6% for the month of May, from 6.8% in April, in a sign the rate hikes are having a significant effect on cooling inflation. The rate may be on pause for July however further rate hikes were not ruled out for months to come.
Locally, the ASX jumped 0.45% following the RBA’s announcement after see-sawing in morning trade, with the afternoon rally largely driven by a surge in real estate stocks as the rate pause maintains the value of properties and keeps REIT funding and borrowing costs at bay for another month.
Gold miners rallied yesterday on strength in the price of the precious commodity as well as Goldman Sachs initiating coverage of Gold Road Resources (ASX:GOR), which fuelled a rally for ASX-listed gold miners yesterday.
Costa Group led the charge yesterday soaring over 12% after announcing the receipt of a takeover offer worth $3.50/share from Paine Swartz Partners in a deal worth $1.6bn. Following the receipt of the offer, Costa Group’s board has granted Paine Swartz Partners an eight-week period of non-exclusive due diligence to enable PSP to put together a binding offer.
The winning stocks on the ASX200 yesterday were led by Costa Group soaring (ASX:CGC) almost 13%, Silver Lake Resources (ASX:SLR) jumping 5.77% and Paladin Energy (ASX:PDN) lifting 4.73%. And on the losing end Domain Holdings (ASX:DHG) fell 3.66%, Star Entertainment Group (ASX:SGR) lost 1.7% and Chalice Mining (ASX:CHN) fell 1.6%.
Over in the US, markets are closed today for the July 4th Holiday, while in Europe, it was a very lacklustre session across markets on Tuesday with little direction from the US being closed and minimal economic data out in the region. Investors in the region also remain cautious around the direction of interest rates and uncertainty around global growth.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.17% lower on Wednesday.
- On the commodities front this morning, oil is up almost 2% at US$71.15 driven by Russia and Saudi Arabia cutting production output, while gold is up 0.18% at US$1924/ounce and iron ore is down 1.76% at US$111.50/tonne.
- AU$1.00 is buying US$0.67 cents, 96.75 Japanese Yen, 52.57 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded the rating on Costa Group (ASX:CGC) from a buy to a hold but upgraded the price target from $3 to $3.50 per share following the announcement yesterday of Costa receiving a takeover offer presented by Paine Swartz Partners for $3.50ps in cash. Shareholders would also receive the 1H23 dividend of up to $0.04ps. Bell Potter has downgraded to a hold following the share price inflation, but the analyst notes they are not ruling out the possibility of potential interest from other parties.
- And Trading Central has identified a bullish signal on Whitehaven Coal (ASX:WHC) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may rise from the close of $6.92 to the range of $8.10 to $8.30 according to standard principles of technical analysis.
Trading was positive on Wall Street overnight, as US equities closed higher, in a shortened session, that marked the start of a new trading month, quarter and half. US markets closed early ahead of the Fourth of July holiday, and they will be closed tonight as well. The Nasdaq advanced the most, while the Dow Jones and the S&P500 closed just slightly in the green. In fact, at the end of last week, the Nasdaq closed out its biggest first-half gain since 1983, advancing 31.7%.
What to watch today:
- The Australian share market is set to open flat this morning, according to the SPI futures, as local investors wait to see if RBA policymakers, meet expectations today at their July meeting.
- The market is expecting the RBA to pause their rate rising cycle this month and hold the cash rate at 4.35%. The decision will be announced at 2:30pm today AEST.
- In commodities,
- Crude oil is trading lower at US$70 per barrel, after Saudi Arabia announced it would extend its voluntary cut of one million barrels per day for August and could prolong further. They will produce approximately 9 million barrels a day, which will be their lowest in several years.
- The gold price is also in the red as investors continue to assess the path for the Federal Reserve’s monetary policy.
- And iron ore is lower, trading at US$113.50 per tonne, as investors are still waiting on any announcements from the Chinese government on stimulus measures for the construction sector, which struggled through pandemic lockdowns.
Trading Ideas:
- Bell Potter maintains a Buy rating on Eagers Automotive (ASX:APE), after announcing it has increased its interest in EV Dealer Group. Bell Potter have lowered their price target to $15.00, and at APE’s current share price of $13.83, this implies 9.5% share price growth in a year.
- And Trading Central have identified a bullish signal in Ansell (ASX:ANN) indicating that the stock price may rise from the close of $27.14 to the range of $28.10 to $28.40 over 16 days, according to the standard principles of technical analysis.
Wall Street closed higher across the key indices on Friday to round out a strong first half of 2023. Technology stocks were once again the driving force behind Friday’s rally, with Nvidia rising 3.6%, Microsoft advancing 1.6% and apple adding 2.3% higher to close above a US$3trn market cap. The Dow Jones added 0.84% on Friday, the S&P500 rose 1.23%, and the tech-heavy Nasdaq advanced 1.45%, to end its best first half of a year since 1983.
Nike shares fell 2.7% on Friday after the apparel giant posted a weaker-than-expected quarterly profit.
Despite the very strong first half, some of Wall Street expect investors to take profits from the first half rally in the second half amid ongoing volatility and the outlook for interest rates to continue rising alongside the potential threat of a recession.
Over in Europe, markets closed higher on Friday and notched out gains for the first half despite interest rate hikes and the regional banking crisis. Eurozone inflation data for June also released late last week showed a greater-than-expected fall to 5.5% for the month indicating the fiscal tightening of the ECB could be starting to have an impact. On Friday the STOXX600 rose 1.2%, Germany’s DAX added 1.26%, the French CAC rose 1.19% and, in the UK, the FTSE100 rose 0.8%.
Locally, the ASX rose 0.12% to finish the last trading session of the financial year at 7203 points and up 1.47% for the week. Information technology were again the leading stocks on the ASX on Friday, with the sector adding 0.83%, while consumer staples and healthcare stocks were sold off.
Link Administration Holdings (ASX:LNK) tanked almost 14% on Friday after the company provided an update that one of its largest customers, industry superannuation fund HESTA, will not renew its contract when it expires.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open the first trading session of the new financial year 0.41% higher.
- On the commodities front this morning, oil is trading 0.13% lower at US$70.53/barrel, coal is up 0.12% at US$128.05/tonne, uranium is down 0.53% at US$56.20/pound, gold is up 0.56% at US$1918.82/ounce and iron ore is down 1.73% at US$113.50/tonne.
- Taking a look at economic data out today, Australia’s building permits data for May is released just before midday with the market expecting a rebound in permits through growth of 2%, up from a decline of 8.1% in April. Australia’s home loans data MoM is also out today with the forecast of a 4% rise, from a 3.8% fall in April.
- AU$1.00 is buying US$0.67, 96.15 Japanese Yen, 52.44 British Pence, and NZ$1.09.
Trading Ideas:
- Bell Potter has downgraded the price target on Bubs Australia (ASX:BUB) from 22 cents per share to 20 cents per share and maintain a hold rating on the company following the recent revenue guidance statement released by the infant formula company including guidance of $52.5m to $55.7m, which is well below Bell Potter’s previously expected revenue of $60m from the company for FY23. Bell Potter also noted Australian exports of finished IMF to China have remained subdued, down 40% YoY and that Bub’s has a clear challenge of managing excessive inventory positions of the Bub’s Supreme product held by channel partners in China.
- And Trading Central has identified a bullish signal on IGO Limited (ASX:IGO) following the formation of a pattern over a period of 12-days which is roughly the same amount of time the share price may rise from the close of $15.20 to the range of $16.90 to $17.30 according to standard principles of technical analysis.
The Aussie share market rose 1.35% this week (Mon-Thu) buoyed by the tech sector surging 3.66% as investor appetite for the high growth sector continues to grow.
In this week's wrap, Grady covers:
- (0:11) Geopolitical tensions in Russia
- (1:05) Volatility in commodity prices
- (1:54) Opportunities as an investor
- (2:45) The AI front
- (3:48) Best performing stocks in the ASX200
- (4:41) The most traded stocks & ETFs by Bell Direct clients
- (5:16) Three economic news items to watch out forRead the transcript article here.
Read transcript here.
In New York overnight, equities were higher after the large banks gained, following the Federal Reserve’s annual stress test. This is a test that ensures the large banks are capitalised and can lend to businesses and households even in a severe recession. All 23 of the US banks that were included in the Fed’s annual stress test weathered a severe recession scenario while continuing to lend to consumers and corporations.
The banks lifted the Dow Jones to close 0.8% higher, while the S&P500 gained 0.45% and the Nasdaq closed flat.
European equity markets were mixed as investors assessed commentary from major central bankers on the need to continue to fight inflation. The STOXX600 ended slightly higher, with retail stocks advancing the most on the back of robust earnings from H&M, while travel and leisure stocks declined.
What to watch today:
- The SPI futures are suggesting the Australian share market will rise 0.17% at the open this morning.
- Looking at commodities,
- Crude oil has rebounded above US$70 a barrel, as investors assessed a larger-than-expected decrease in US inventories and weighed the impact of rising interest rates on global growth and fuel demand. The latest Energy Information Administration report saw a significant drop of 9.6 million barrels in crude inventories last week, when the market expected a 1.8 million barrel draw. So, keep watch of energy producers today.
- Gold stocks will also be on watch after the gold price fell overnight. So watch gold miners such as St Barbara (ASX:SBM) and Newcrest Mining (ASX:NCM).
- And iron ore has advanced, trading at US$116.50 per tonne, very close the two-month high of US$117 touched mid-June. Markets are assessing concerns of lower demand against the possibility that the Chinese government will provide stimulus measures for its construction sector.
Trading Ideas:
- Bell Potter maintains a Buy rating on Telix Pharmaceuticals (ASX:TLX) after recently completing a site tour of the company’s US Head Office and attended an investor day targeted at US investors and the annual SNMMI conference. Their price target remains unchanged at $14, and at TLX’s current share price of $11.44, this implies 22.4% share price growth in a year.
- And Trading Central have identified a bullish signal in Viva Energy (ASX:VEA) indicating that the stock price may rise from the close of $2.98 to the range of $3.29 to $3.37 over 18 days, according to the standard principles of technical analysis.
Australia’s inflation rate fell faster than expected on an annual basis in May to a rise of 5.6% in the year to May 2023, below the expected rise of 6.1% and well below April’s annual increase of 6.8%, in a major sign the RBA’s rate hikes are having a strong impact in cooling inflation down under. The most significant price rises were Housing (+8.4%), Food and non-alcoholic beverages (+7.9%), and Furnishings, household equipment and services group (+6%). Offsetting the rise in CPI for the year to May 2023 was Automotive fuel prices dropping 8%, which is a significant decline on the April reading of +9.5%.
The local market responded very positively to the release of the CPI data with the ASX200 closing the midweek session up 1.10% led by a 2.14% surge in consumer discretionary stocks, a sector that has been beaten down in recent times due to higher interest rates restricting consumer spend on discretionary goods.
Over in New York on Wednesday, it was a mixed session as investors responded to comments made by Federal Reserve Chair Jerome Powell regarding the need for further tightening of monetary policy. Powell said on Wednesday that “more restrictive policy is still to come” as inflation remains above the target of 2%.
On Wednesday, the Dow Jones closed Wednesday’s session down 0.22%, the S&P500 fell just 0.04%, and the tech-heavy Nasdaq rose 0.27%.
Over in Europe, markets closed higher on Wednesday as investors in the region closely monitored further comments made by central bankers and officials at the European Central Banking conference in Portugal. Bank of England Governor Andrew Bailey defended the Bank of England’s decision to hike rates by 50 basis points last week, while the overall message from the conference remained focused on “higher for longer”.
The STOXX600 rose 0.7%, Germany’s DAX rose 0.64%, the French CAC added almost 1%, and, in the UK, the FTSE100 rose 0.52%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.07% lower following a weaker session on Wall St overnight.
- On the commodities front this morning, oil has rebounded to trade 2.75% higher at US$69.56/barrel, coal is up 1.91% at US$127.90/tonne, gold is down 0.32% at US$1907.23/ounce and iron ore is up 2.67% at US$115.50/tonne.
- Japan’s consumer confidence data for June is out this afternoon, with consensus expecting a rise of 0.2 points to 36.2 as the economy continues recovering from pandemic-related disruptions.
- AU$1.00 is buying US$0.66, 95.31 Japanese Yen, 52.48 British Pence and NZ$1.09.
- Stocks trading ex-dividend today include Stockland, Transurban Group, APA Group and GPT Group.
Trading Ideas:
- Bell Potter has initiated coverage of CSR (ASX:CSR) with a Hold rating and a price target of $5.60 noting the diversified manufacturing company boasts sector leading performance with operations in building products, aluminium and property development. The hold rating is due to CSR’s addressable backlog of work from Homebuilder nearing conclusion signalling the Building Products division of CSR approaches the backend of its pricing cycle. Bell Potter is attracted to the long-term market share opportunity for Hebel in Australia and tailwinds supporting CSR’s property portfolio.
- And Bell Potter has increased the price target on PointsBet (ASX:PBH) from $2 to $2.25 and maintain a speculative buy rating on the sports betting company after the announcement that Fanatics Betting and Gaming has increased its offer for PointsBet’s US business from US$150m to $225m in cash. DraftKings was in the running to buy the American operations however failed to finalise a binding offer by 6pm on Tuesday so the PointsBet board is recommending the increased Fanatics offer given its superiority in both terms of pricing and certainty.
The local market returned to rally mode on Tuesday closing the session up 0.56% as a near 2% rise in real estate stocks lifted the market, while materials also added over 1.15% and financials closed up 0.66%.
As the cost-of-living pressures continue to bite, the flying kangaroo is flying higher than ever with demand for travel on Qantas remaining resilient as outlined by the airline yesterday in a May update to the market. Qantas said more than 4 million customers are expected to travel during the current school holidays on Qantas and Jetstar and overall demand remains strong as consumers continue to prioritise travel over other spending categories.
Bega Cheese shares also dipped on Tuesday after the dairy producer also released a trading update outlining that falling supply of Australian milk means it expects prices of milk to rise again in FY24, meaning Bega, as one of the largest buyers of farmgate milk in Australia, expects to report an impairment in the value of its build dairy business between $180m - $280m, with a clearer final figure expected when Bega receives the audited result for FY23 and will update the market when they have more clarity.
And for all the KFC chicken lovers out there, shares in Collins Foods, the operator of 272 KFC fast food restaurants in Australia, rocketed almost 16.5% yesterday after the company released full year results outlining revenue rose 14.2% to $1.349.5bn and an underlying net profit of $51.9m, which was down 12% YoY but beat expectations. Collins Foods warned inflation is set to remain sticky for the next 12-months due to persistent inflation in the costs of running the fried chicken outlets including wages, energy prices and input costs.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.37% higher on the back of the global rally overnight.
- On the commodities front this morning oil is trading 2.76% lower at US$67.47/barrel as central global growth rate concerns offset upside momentum from Saudi Arabia’s production cuts coming into effect next week. Gold is trading 0.45% lower this morning at US$1914/ounce, and iron ore is down 1.75% at US$112.50/tonne.
- AU$1.00 is buying US$0.67 , 96.33 Japanese Yen, 52.63 British Pence and NZ$1.08.
- Australia’s monthly CPI indicator data for May is out today, with consensus expecting a decline to 6.1% for the month, down from 6.8% in April, which would indicate the RBA’s actions to hike rates is making a strong impact on cooling inflation, which has been particularly stubborn to tame especially for services and transport inflation.
Trading Ideas:
- Bell Potter has downgraded the rating on Bega Cheese (ASX:BGA) to a Hold from a Buy, and decreased the price target on the cheese and dairy company from $4.00 to $3.50 following the company’s release of an update including a rise in farmgate milk prices, Australian milk solids appearing mispriced against export ingredient prices, impeding returns in bulk ingredients and the risk that more attractively priced offshore milk solids increasingly find their way into the domestic market, all leading to headwinds in some domestic revenue streams.
- And Bell Potter has increased the price target on De Grey Mining (ASX:DEG) from $1.83 to $1.93 and maintain a speculative buy rating on the gold miner after the company released an updated Mineral Resource Estimate for its 100%-owned Mallina Gold Project, with the resource now standing at 278 million tonnes @1.3g/t of gold for 11.7 million ounces contained, representing a 10% increase in contained ounces from the prior Mallina Gold Project Mineral Resource Estimate.
Well looking at global markets overnight, US equities closed in the red, following a sell-off in technology companies, which have outperformed this year. The pullback in tech stocks saw the Nasdaq sharply drop, closing the session 1.16% lower. Meanwhile, the S&P500 fell 0.45% and the Dow slightly down 0.04%.
In Europe, markets closed mixed, with Germany’s DAX, the FTSE 100 and the STOXX 600 all closing the session down just 0.1%, while France’s CAC was in the green.
What to watch today:
- The Australian share market is set to open higher this morning, with the SPI futures suggesting a 0.28% rise at the open.
- In commodities,
- Global oil prices were higher following news of an armed rebellion against Russian President Vladimir Putin. Prices rose as investors monitored a potential oil shortage.
- The price of gold has rebounded further from a three-month as global economic uncertainties and political instability in Russia drove some safe-haven demand for metal.
- And iron ore remains close to a two-month high as markets assessed concerns of lower demand against the possibility that the Chinese government will provide stimulus measures for its construction sector.
- And today keep watch of Appen’s (ASX:APX) share price moments. The AI data services company faced further turbulence yesterday, with its share price plunging 12% on the release of an announcement outlining its CFO, Helen Johnson, has decided to stand down just two months after stepping into the role.
- Also keep watch of Wesfarmers (ASX:WES), which rallied yesterday after the Australian conglomerate entered into a scheme implementation deed through its wholly-owned subsidiary, Australian Pharmaceutical Industries to acquire 100% of Silk Laser Clinics’ outstanding shares for $3.35 cash per share by way of a scheme of arrangement. The deal values Silk Laser Clinics at $180 million and the Silk board has unanimously recommended that shareholders vote in favour of the scheme.
Trading Ideas:
- Bell Potter have downgraded their recommendation on DDH1 (ASX:DDH) from a Buy to a Hold, after the company announced that they entered into a binding Scheme Implementation Agreement. Perenti (ASX:PRN) will acquire 100% of the fully paid ordinary shares in DDH). Bell Potter have also downgraded their price target to the current implied acquisition price of $0.94 per DDH share.
- And Trading Central have identified a bearish signal in Charter Hall (ASX:CHC) indicating that the stock price may rise from the close of $10.52 to the range of $9.30 to $9.60 over 57 days according to the standard principles of technical analysis.
Wall Street slid on Friday with the key indices closing lower for the week and the Nasdaq snapping an 8-week winning streak as investors shift focus to the high potential of a US and possibly global recession. The Dow Jones fell 1.7% over the week, the S&P500 lost 1.4%, and the tech-heavy Nasdaq also fell 1.4%. Inflation around the world remains elevated, and stock markets have been on a solid rally of late, so investors have pulled back optimism and now assess the high likelihood of a US recession as the Federal Reserve maintains an aggressive stance toward tackling inflation. Shares in Goldman Sachs declined on Friday after CNBC reported the investment bank is likely to face a large write down for its 2021 acquisition of fintech firm GreenSky.
Over in Europe, markets in the region closed lower on Friday amid dampened global investor sentiment and on the back of a hawkish 50-basis point rate hike out of the Bank of England on Thursday. In the eurozone flash purchasing managers’ index data, a fall from 52.8 points to 50.3 points. A reading below 50 indicates a contraction, which is something to keep in mind for the euro zone over the month ahead. The STOXX600 fell 0.3% on Friday, Germany’s DAX fell 0.99%, the French CAC lost 0.55%, and, in the UK, the FTSE100 lost 0.54%. German energy company, Siemens Energy tumbled 37% on Friday after scrapping its profit guidance due to issues with its wind turbine division.
On the local index, the ASX200 dived 1.34% on Friday, weighed down by a near 4% loss in the energy sector as the price of oil dipped 3.15% last week to US$69.71/barrel as rate hike concerns and recession fears weigh on demand outlook for the commodity. The utilities and consumer staples sectors were the only two to close in positive territory on Friday.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open Monday’s trading session down 0.23% on dampened global investor sentiment.
- Taking a look at commodities this morning, oil is up 1.06% to start the new trading week at US$69.89/barrel, coal is down 0.2% at US$125.50/tonne, gold is up 0.16% at US$1923.68/ounce and iron ore is flat at US$114.50/tonne.
- On the economic data front, the European Central Bank Forum on Central Banking begins today in Portugal where central bank governors, and officials meet to exchange views on current policy issues and discuss the forum’s outlook for longer-term perspective.
- AU$1.00 is buying US$0.67, 96 Japanese Yen, 52.35 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased the price target on Delta Lithium (ASX:DLI) from $1.05 to $1.25 and maintain a buy rating on the lithium explorer following the release of high-grade drilling results and updated deposit dimensions. The company reported drilling results from its Yinnetharra Lithium Project in WA and notes ‘Malinda boasts a lithium Mile’ comprising two major parallel ore zones M1 and M35 each now drilled out over 1.6km in strike length. The company’s Mt Ida asset it also a near-term producer, targeting direct shipping operation from Q4FY23.
- Trading Central has identified a bearish signal on Helloworld Travel (ASX:HLO) following the formation of a pattern over a period of 49-days which is roughly the same amount of time the share price may fall from the close of $2.47 to the range of $1.95 to $2.05 according to standard principles of technical analysis.
The Aussie share market fell 0.77% this week (Mon-Thu) as the recent rally for information technology stocks lost steam with the sector closing 3.13% lower over the four days. Investors bought into consumer staples stocks which are generally more likely to hold their value in a high interest rate, high inflation environment.
In this week's wrap, Grady covers:
- (0:34) Understanding the EV movement
- (1:04) Updates on Rio Tinto (ASX:RIO) & BHP Group (ASX:BHP)
- (2:46) Updates on Delta Lithium (ASX:DLI) & Talga Resources (ASX:TLG)
- (03:57) Investing in the battery metals sector
- (4:33) Best performing stocks in the ASX200
- (5:35) The most traded stocks & ETFs by Bell Direct clients
- (6:08) Three economic news items to watch out for
European stocks closed lower overnight after the Bank of England opted for a more hawkish 50 basis point rate hike. The STOXX 600 is down 0.5%, trimming earlier losses of more than 1%. The index has posted declines in all four sessions so far this week.
US equities saw little improvement overnight as Wall Street heads for a losing week. The Nasdaq performed best as investors boosted tech stocks, after a three- day breather from the market rally and Apple shares moved to a new all-time high. The Nasdaq closed 0.95% higher, the S&P500 up 0.37%, while the Dow Jones closed flat.
What to watch today:
- The SPI futures are suggesting our local market will drop 0.1% at the open this morning.
- In commodities,
- Crude oil has dropped more than 4% to approach US$69 a barrel, as hawkish messages from major central banks raised concerns that interest rates will continue to march higher for longer, therefore impacting demand further.
- The price of gold extended losses hitting its lowest in over three months, following the hawkish outlook for major central banks, which continues to pressure the demand for non-interest-bearing bullion assets.
- Iron ore is also trading in the red, as concerning macro data out from China underscored its struggle to recover from the pandemic lockdowns, particularly in the property sector.
Trading Ideas:
- Bell Potter maintains a buy rating on Gold Road Resources (ASX:GOR) following the company’s production report. Production was impacted by reliability and utilisation of the production drills and availability of blasting resources and a significant rain event. Bell Potter have reduced their price target from $2.05 to $1.95. At GOR’s current share price of $1.60, this implies 21.9% share price growth in a year.
- And Trading Central have identified a bearish signal in MAAS Group Holdings (ASX:MGH) indicating that the stock price may fall from the close of $2.57 to $2.19 to $2.27 over 33 days, according to the standard principles of technical analysis.
US and European markets declined overnight, following the Federal Reserve’s Chairman’s latest comments on inflation, that weighed on the investor sentiment. Jerome Powell said that more rate hikes are likely ahead to combat inflation. US equities were flat in overnight trading, after the market suffered three consecutive days of declines, as the tech-power rally has started to fade. All three major benchmarks fell for three days in a row, with the S&P500 marking its worst daily performance this month.
What to watch today:
- The SPI futures are suggesting our local market will drop 0.14% at the open this morning, after markets closed in the red overnight.
- In economic data, the Manufacturing and Services Flash PMI will be out this morning. That’s the producer’s managers index, that looks at economic trends in the manufacturing and services sectors. The flash PMI is a forward-looking estimate of the final PMI out next Wednesday. And remember a PMI above 50, illustrates an expansion from the month prior.
- Looking at commodities,
- The price of oil is trading 2% higher at US$72.60 a barrel, the highest in two weeks, on optimism about strong demand in the United States.
- The gold price is lower, extending losses from this week, to their lowest in three months, following the comments made by the Fed.
- And iron ore is now slightly lower, however is hovering near its seven-week high of US$115.50 per tonne, amid bets of incoming stimulus rollouts from Beijing.
Trading Ideas:
- Bell Potter maintains a Buy rating on Lynas Rare Earths (ASX:LYC) and have decreased their price target by 4% to $8.55 from $8.90. Bell Potter says that LYC is a high-quality business, and a key supplier of separated rare earths to Western economies. The price target of $8.55 and the current share price of $7.43, implies 15% share price growth in a year.
- And Trading Central have identified a bearish signal on Flight Centre (ASX:FLT), indicating that the stock price may fall from the close of $19.90 to the range of $18.30 to $18.70 over 35 days, according to the standard principles of technical analysis.
The RBA meeting minutes were released yesterday hinting at the potential for further rate hikes to come, possibly taking the nation’s cash rate to 4.60%, as the outlook for price pressures to become embedded raises concerns for the RBA especially if wages continue rising against stagnant productivity output. Stagnant productivity was a key inclusion in the RBA meeting minutes as members discussed the importance of growing productivity amid output per hour worked not increasing over the past 3 years, hence leading to GDP data growth actually worsening in Q1FY23.
The ASX closed 0.86% higher yesterday, extending the ASX rally of late into a 7th straight session, buoyed by a surge in energy stocks with the sector closing just shy of 2% higher on Tuesday.
In Australia, retail stocks took another hit yesterday after Best & Less (ASX:BST) downgraded profit guidance by 65% as the consumer discretionary sector as a whole feels the brunt of declining consumer spend. The company now expects net profit between $3.6m and $4.2m in H2FY23, down from the initial guidance issued of $10m to $12m.
Over in New York on Tuesday, stocks are trading lower on the first trading session of the week on Wall St as the recent lengthy rally took a slight breather ahead of Federal Reserve Chair Jerome Powell’s congressional testimony. The Dow Jones fell 0.72% on Tuesday while the S&P500 lost 0.47% and the Nasdaq declined 0.16%. On the earnings front, FedEx reports FY23 results after the closing bell on Tuesday. Adding to investor uncertainty was homebuilding projects data in the US out for May showing a surge in single-family homebuilding projects.
In Europe, markets closed lower across the board on Tuesday as investor sentiment remains cautious particularly following recent data from China and the lacklustre return to full operational capacity in the region weighing on global economies. The STOXX600 fell 0.6% on Tuesday, Germany’s DAX fell 0.55%, the French CAC lost 0.27% and, in the UK, the FTSE100 lost 0.25%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the local index to open 0.4% lower amid global markets turbulence overnight.
- On the commodities front this morning, oil is down 1.03% at US$71.18/barrel, gold is down 0.67% at US$1937/ounce, copper is up 2.24% at US$3.87/pound, and iron ore is flat at US$117/tonne.
- Economic data out today includes UK annual inflation rate data with the market expecting a decline to 8.4% in May from 8.7% in April.
- Investors in the UK will be awaiting the rate decision out of the Bank of England tomorrow with the expectation for a 25-basis point rate hike which will take the British cash rate to 4.75% for the month ahead.
- AU$1.00 is buying US$0.68, 95.85 Japanese Yen, 53.70 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded the price target on Mineral Resources (ASX:MIN) from $95 to $90 per share but maintain a buy rating on the mining giant after the company updated the market on its lithium business including the termination of the Mount Marion toll treatment agreement with Ganfeng Lithium Co. but MIN will still sell its Mount Marion spodumene concentrate to Ganfeng at market prices. Mineral Resources also updated the market on a second natural gas discovery at North Erregulla Deep-1, and early results of exploration for lithium at Mount Marion confirmed exploration potential at depth.
- And Bell Potter has initiated coverage of COSOL (ASX:COS)with a Buy rating and a price target of $1 noting the specialised digital IT solutions and data management company offers a compelling value proposition in the Enterprise Asset Management industry with strong financial growth, a diverse client base, strategic partnerships and actively supports its clients’ sustainability goals.
The local market started the new trading week 0.6% higher, carrying the ASX rally into a 6th straight session driven by a rally for healthcare stocks, namely, CSL as investors took last week’s update-driven sell-off as an opportunity to buy into Australia’s largest biotech company on Monday.
Locally, PointsBet (ASX:PBH) jumped 19% during the session after updating the market on its non-binding indicative proposal from DraftKings to acquire PointsBet’s US business for a headline purchase of US$195m on a debt-free and cash-free basis. Yesterday’s announcement saw the PointsBet board share that DraftKings offer could be ‘reasonably expected to lead to a Superior Proposal’, which would further boost the PBH share price, especially as Fanatics Betting is also in the race to acquire the online sports betting company.
On the mining front, Lake Resources (ASX:LKE) tanked 16% on Monday after releasing a two-phase development to targeted production of 50,000 tonnes per annum of battery grade lithium carbonate at its Kachi project in Argentina. The update outlines significantly higher capital costs, a 3-year delay to the expected production date commencement at the mine and a 50% reduction to the target amount of tonnes per annum of lithium from the project.
Wall St was closed overnight for the Juneteenth National Independence day holiday, however all eyes will be on Fed Chair Jerome Powell’s testimony on Thursday night Australian time to determine what the rate hike movements look like for the coming months. The Nasdaq was the winning index last week, gaining 3.3% as investor appetite for technology stocks continues to grow amid the hype around AI and its ability to drive hyper operational efficiency across many industries.
Over in Europe, equities fell on Monday as investors’ concerns over weakened demand recovery from China weighed on resources companies in the region, and healthcare stocks took a hit on dampened corporate forecasts. The STOXX600 fell 1% on Monday with all sectors ending the session in negative territory, while Germany’s DAX lost almost 1%, the French CAC closed 1.01% lower and, in the UK, the FTSE100 fell 0.71%.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the ASX to open Tuesday’s session 0.15% higher, extending the local green run into a 7th straight session.
- On the commodities front this morning, oil is trading 0.8% lower at US$71.21/barrel, coal is down 5.52% at US$128.45/tonne, gold is down 0.4% at US$1949.70/ounce and iron ore is up 0.43% at US$117/tonne.
- Stocks trading ex-dividend today include Premier Investments (ASX:PMV). If you’ve been thinking about this stock it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- AU$1.00 is buying US$0.68, 7.20 Japanese Yen, 53.75 British Pence, and NZ$1.10.
Trading Ideas:
- Bell Potter has initiated coverage of Matrix Composites & Engineering (ASX:MCE) with a Hold rating and a price target of $0.35 noting the near-term earnings and free cash flow outlook is leveraged to increases in global offshore energy development activity, which Bell Potter estimates is currently at a 5-year high, resulting in an uplift in outstanding product orders to be delivered of 2H FY23 and FY23.
- And Bell Potter has downgraded the price target on Bega Cheese (ASX:BGA) from $4.10 to $4.00 and maintain a buy rating on the dairy company amid forecasts for movements in the cash rates, implied yield curves and impact of the strengthened Aussie dollar to USD on AUD commodity returns.
On Wall St, stocks closed lower on Friday but higher across the key indices for the week as investor sentiment was boosted by a rate pause out of the fed, encouraging inflation data and ongoing strength in the technology sector which saw the Nasdaq rise 3.3% for the week, marking an eight-week winning streak. The Dow Jones added nearly 1.3% for the week and the S&P500 rose 2.6% on the week. Software giant Adobe rose 0.9% on Friday after beating expected results and issuing upbeat earnings guidance, while Virgin Galactic rose 13% after announcing on Thursday that it will launch its first commercial space tourism flight this month.
Over in Europe, markets closed higher on Friday as investors digested the latest monetary policy decision out of the European Central Bank in the form of a 25-basis point rate hike for the month ahead. ECB president Christine Lagarde said they are not thinking about pausing yet. Germany’s DAX rose 0.41% on Friday while the French CAC added 1.34% and, in the UK, the FTSE100 rose 0.19%.
The local market jumped over 1% on Friday led by a 3.5% surge in the energy sector led by Whitehaven Coal rallying over 8%, while Santos added 4.1% and Woodside Energy jumped 3.5%.
AGL Energy was the winning stock of Friday’s session after the electricity and gas provider released a guidance update on Friday revealing it expects underlying profit for 2023-2024 double with an expected increase between $580m and $780m, which is a significant jump from the guidance issued this year of between $255m and $285m. The strong profit guidance is driven by higher wholesale power prices and improved power plant operations.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the local index to open the first trading session of the week down 0.04%.
- On the commodities front this morning, oil is trading 0.48% lower at US$71.44/barrel, coal is down 5.52% at US$128.45/tonne, uranium is up 4.05% at US$57.75/pound, gold is down 0.03% at US$1957/ounce, and iron ore is up 0.43% at US$117/tonne.
- There is no local economic data out today however investors will be awaiting the release of the RBA’s latest meeting minutes out tomorrow which will give an insight into how hawkish or dovish the RBA are regarding interest rate hikes over the coming months.
- AU$1.00 is buying US$0.69 cents, 97.55 Japanese Yen, 53.75 British Pence and NZ$1.10 dollar.
Trading Ideas:
- Bell Potter has downgraded the price target on Australian Vintage (ASX:AVG) from 65cps to 50cps and maintain a hold rating on the Australian wine company following the release of a trading update outlining revenue and EBITDAS guidance for FY23 that were broadly in-line with expectations but significantly lower than FY22 as growing conditions worsened during key yield development months earlier in the year. As a result of the conditions, AVG’s company owned and leased crush came in materially below previous guidance, representing a 20% decline on yield vs 2022. The upside for AVG is the company continues to win market share in the premium product segments.
- Trading Central has identified a bullish signal on Woodside Energy Group (ASX:WDS) following the formation of a pattern over a period of 13-days which is roughly the same amount of time the share price may rise from the close of $35.63 to the range of $38.10 to $38.70 according to standard principles of technical analysis.
The Aussie share market rose 0.74% this week (Tue-Thu) as information technology stocks rallied whilst the health care sector headed to the chopping block.
In this week's wrap, Grady covers:
- (0:10) Investor sentiment
- (0:30) The turmoil surrounding Domino’s (ASX:DMP), CSL (ASX:CSL) & DGL (ASX:DGL)
- (4:05) Downgrades as the key driver of guidance revisions
- (5:20) Best performing stocks in the ASX200
- (6:07) The most traded stocks & ETFs by Bell Direct clients
- (6:40) Three economic news items to watch out for
Wall Street closed mixed on Wednesday as investors assessed favourable PPI data, and the federal reserve holding the cash rate at 5%-5.25% for another month, against the Fed signalling more rate hikes are expected in the coming months.
US producer purchasing price index data for May came in at a decline of 0.3%, beating expectations of a 0.1% drop and well below the unexpected rise of 0.2% in April, in another sign the Fed’s aggressive rate hike strategy is cooling economic growth and inflation. Goods prices fell 1.6%, the largest decrease since July 2022 mainly due to a 13.8% decline in gas prices and a 1.3% drop in food prices. The federal reserve’s FOMC meeting wrapped up overnight with the fed announcing a pause in rate hikes after 10 consecutive rises, but signalled more rate hikes by the end of the year in anticipation of inflation remaining sticky and above the target of 2%. The S&P500 rose 0.08%, and the Nasdaq added 0.39%, but the Dow Jones fell 0.68%.
Over in Europe, markets closed higher as investors looked ahead to the expected rate pause announcement out of the US which came after hours in European time. UK GDP data out yesterday also came in-line with expectations at a rise of 0.2% which was largely driven by growth in services. Germany’s DAX rose just under half a percent, the French CAC added 0.52% and, in the UK, the FTSE100 rose 0.1%.
Locally, the ASX rose 0.32% yesterday buoyed by a rally for materials stocks on the back of rising commodity prices driven by optimism that China may reveal a broader economic policy to stimulate economic recovery post pandemic in the very near future. On Tuesday, China’s central bank lowered a short-term lending rate for the first time in 10-months in a bid to boost its struggling-post pandemic recovery, which boosted hopes for a wider policy to be announced soon. Iron ore rallied over 2.2% yesterday, while copper added 2.93% on the news.
Biotech giant CSL fell over 7% on Wednesday after the company released an update guiding to lower profits for FY23 due to adverse currency movements. These adverse currency movements mean that CSL will now realise a negative impact to their fiscal 2023 forecast profit of between US$230 and US$250m.
What to watch today:
- On the back of the global rally overnight, the SPI futures are anticipating the local index to open the second last trading day of the shortened week 0.28% higher.
- On the commodities front this morning, oil is down 1.07% at US$68.69/barrel, coal is down 1.31% at US$132.25/tonne, uranium is up 4.05% at US$57.75/pound, iron ore is up 2.24% at US$114/tonne, and gold is down just 0.01% at US$1943/ounce.
- AU$1.00 is buying US$0.68, 95.25 Japanese Yen, 53.70 British Pence and NZ$1.10
Trading Ideas:
- Bell Potter has decreased the price target on Frontier Digital Ventures (ASX:FDV) from 89 cents per share to 83 cents per share and maintain a speculative buy rating on the online marketplace investment company following a revisit by the Bell Potter analyst to the company’s exposure and forecasts regarding Pakistan-exposed portfolio companies following the recent meeting of State bank of Pakistan’s Monetary Policy Committee. The Committee resolved to keep its interest rate steady at 21%, as inflation rose to 38% in May. Following this, Bell Potter analysts expect demand in the region to be subdued, having negative implications for Pakistan-exposed companies in Frontier Digital Ventures portfolio including Zameen and PakWheels.
- And Trading Central has identified a bullish signal on Sandfire Resources (ASX:SFR) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may rise from the close of $6.18 to the range of $6.65 to $6.75 according to standard principles of technical analysis.
The first trading session on the ASX for the shortened week ended in a positive note, with the key index closing up 0.23%, and 8 of the 11 sectors ending the day higher.
Pizza giant Domino’s tumbled over 7% on Tuesday after the company said it expects sales to fall below expectations for FY23 as cost-of-living pressures continue to bite. The market may also have been led by NAB business confidence data out yesterday showing Aussie business sentiment slid 4 points in May from a flat reading in April in signs of tougher times faced in the local economy from a business perspective. Westpac Consumer Confidence data also out yesterday had a similarly lacklustre reading, with consumer optimism only rising 0.2% for June from a 7.9% fall in May, which was below expectations of a 3.2% rise.
Local tech stocks rallied yesterday, taking lead from a strong session on the Nasdaq in New York on Monday.
Over in the US, it is a crucial week for Wall St as the Federal Reserve’s next policy meeting to decide the latest rate decision began yesterday and the rate announcement will be released this afternoon, with economists expecting a halt in rate hikes which will maintain the US cash rate at 5% to 5.25% for the month ahead. The market is also responding to US core inflation figures which were released late last night AU time, showing US core inflation fell to 5.3% from 5.5% in April and the annual inflation rate fell to 4%, the lowest level since March 2021 and below the forecast of 4.1% and down from 4.5% in April.
Over in Europe overnight, markets ended higher as investors digested strong UK employment figures and US inflation data ahead of the US Fed’s rate hike decision. UK labour figures showed employment in the region rose 0.2 percentage points from February to April and average wage growth accelerated from 6.7% to 7.2% over the period, which were ahead of expectations. Some economists believe this data will add heat to the Bank of England to raise rates further at the policy meeting next Thursday. Germany’s DAX added 0.83%, the French CAC rose 0.56% and, in the UK, the FTSE100 rose 0.32% on Tuesday.
What to watch today:
- The SPI futures are anticipating the local index to open 0.62% higher this Wednesday on the back of the global inflation data-led rally overnight.
- On the commodities front this morning, energy stocks have come under pressure this week amid the declining price of oil, with the commodity down 6% over the last week to US$67.32/barrel amid the Fed’s latest meeting, concerns over fuel demand growth in China and increasing supply out of Russia pressuring the price of the commodity. This morning though, oil is up almost 3% at US$69.08/barrel, gold is down 0.77% at US$1941.71/ounce and iron ore is down 3.46% at US$111.50/tonne.
- AU$1.00 is buying US$0.68, 94.78 Japanese Yen, 53.97 British Pence and NZ$1.10 cents.
Trading Ideas:
- Bell Potter has downgraded the price target on Cedar Woods (ASX:CWP) from $5.40 to $5.20 but maintain a buy rating on the property and land development company following the release of a trading update whereby the company announced lower guidance for FY23 NPAT to approximately $30m compared to the previous guidance of $37.4m. Cedar Woods attributed the downgrade in guidance to weather conditions and supply chain constraints having delayed settlements from Q4 FY23 to FY24.
- And Bell Potter has increased the price target on Doctor Care Anywhere (ASX:DOC) from 6cps to 8cps and maintain a speculative buy rating on the tele-health company after the company reported a 21% rise in patient consultations in Q1FY23 from the PCP, in addition to record consultations in May of 65,200 patients.
In New York overnight, the S&P500 jumped to its highest level in 13 months, markets have come to expect that the Federal Reserve will skip a rate increase at this week’s Fed meeting. The Fed has hiked 10 consecutive times since beginning its policy tightening cycle in March last year. US investors are also awaiting inflation data out on Tuesday in the US, with economists expecting CPI to show inflation dropping to a 4% annual rate in May. All three major benchmarks rallied overnight. The S&P500 up 0.9%, the Dow up 0.56% and the Nasdaq up 1.53%.
European markets also closed higher, ahead of the major central bank meetings.
What to watch today:
- Well, to start the shortened trading week, after yesterday’s public holiday, the SPI futures are suggesting that our local market will open 0.35% higher this morning.
- In commodities,
- The oil price is down to its lowest level in over 5-weeks, with concerns about weakening demand in China as well as rising Russian crude supply outweighed Saudi Arabia’s plans to slash output. The oil price is currently trading 4.25% lower at US$67.12 per barrel. So, keep watch of energy producers today.
- The gold price is also lower ahead of central bank meetings scheduled this week for the Federal Reserve, the European Central Bank, and the Bank of Japan.
- Meanwhile, iron ore is up more than 3%, trading at US$115.50 per tonne, extending its rebound from the six-month low amid expectations of improved demand.
- In economic news, at 10:30am today AEST Westpac will release its data on consumer confidence for June and at 11:30am today NAB will release its data on business confidence for May.
Trading Ideas:
- Bell Potter have upgraded their recommendation on PWR Holdings (ASX:PWH), a leading provider of customised cooling solutions to the global motorsports market and the wider automotive industry. They’re upgraded their rating from a Hold to a Buy, after reviewing forecasts considering some soft trading updates from various retailers. The price target has been decreased by 2% to $10.50, which is more than a 15% premium to the share price, hence the upgrade.
- And Trading Central have identified a bearish signal in Region Group (ASX:RGN), indicating that the stock price may fall from the close of $2.44 to the range of $2.33 to $2.35 over 26 days, according to the standard principle of technical analysis.
The Aussie share market fell 0.64% (Mon-Thu), as investor sentiment was dampened by the RBA’s unexpected 25-basis point rate hike announcement on Tuesday, with warning of further hikes to come if inflation does not move toward the 2-3% target range.
In this week's wrap, Sophia covers:
- (0:11) What’s happening in the energy sector
- (1:22) Concerns for manufacturers with energy transitions
- (1:57) The surge in gas prices
- (2:47) Best performing stocks in the ASX200
- (3:31) The most traded stocks & ETFs by Bell Direct clients
- (4:04) Three economic news items to watch out for
In the US overnight, the S&P500 and Nasdaq closed lower as investors took profits from technology stocks that have rallied over recent weeks, and overall investor sentiment was dampened by a surprise interest rate hike out of Canada’s central bank due to persistent inflation in the region. The rate hike out of Canada heightened investor fears ahead of the Fed’s FOMC meeting next week.
US trade balance data for April was also released yesterday weighing on investor sentiment as the data showed the US trade deficit widened in April by US$14bn to US$74.6bn as exports fell 3.6%, which is the most since the pandemic began.
The S&P500 lost 0.38% on Wednesday while the Nasdaq declined 1.29%, but the Dow Jones rose 0.27%.
Over in Europe, markets also closed lower as investor sentiment remains shaky amid persistently high inflation and fears of further rate hikes to come, especially out of the UK, with new data showing the UK will experience the highest level of inflation among all advanced economies this year.
Germany’s DAX fell 0.2% on Wednesday, the French CAC lost 0.09%, and, in the UK, the FTSE100 fell 0.05%.
The local index closed 0.16% lower on Wednesday, weighed down by losses in the energy, financials and real estate sectors as investors assessed outlook for further rate hikes out of the RBA alongside the release of Australia’s GDP growth rate data for Q1 which came in below expectations at an expansion of 0.2% quarter-on-quarter, but revealed the low unemployment rate and demand for services had lifted unit labour costs and further weakened already low productivity output growth. Through the year, the economy grew by 2.3%, slowing from a 2.7% expansion in Q4.
The GDP data also validates the RBA’s case to possibly continue raising interest rates as real GDP growth slowed mostly from higher prices. It’s also important to note that the RBA are watching key developments in economic datapoints to guide the rate movements forward, including the global economy, household spending, and growth in labour costs. On the latter point, GDP per hour worked fell by 0.3% quarter-on-quarter in Q1, resulting in an annual fall of 4.6% in productivity – which is the largest on record according to CNBC and is a key indicator of the need to raise interest rates. This is because the labour market data suggests that productivity will likely remain weakened this quarter, which will again hike unit labour cost growth and keep services inflation stubbornly high.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are expecting the local market to open 0.18% lower.
- On the economic data front today, Australia’s trade balance data for April will be released just after midday with consensus expecting a decline in Australia’s trade surplus from $15.3bn in March to $14bn in April amid a decline in net exports.
- On the commodities front this morning, oil is trading 1.01% higher at US$72.47/barrel, uranium is up 1.87% at US$54.60/pound, gold is down 1.02% at US$1942.81/ounce and iron ore is up almost half a percent at US$109/tonne.
Trading Ideas:
- Bell Potter has increased the price target on Green Technology Metals (ASX:GT1) from $1.38 to $1.46 and maintain a buy rating on the lithium exploration and development company after the company announced an initial 8.1million tonnes at 1.32% Lithium Oxide Mineral Resource Estimate for the Root Bay prospect, part of its 100%-owned Root Project in Ontario, Canada.
- Trading Central has identified a bearish signal on Air New Zealand (ASX:AIZ) following the formation of a pattern over a period of 165-days which is roughly the same amount of time the share price may fall from the close of 69 cents to the range of 59 to 61 cents according to standard principles of technical analysis.
Wall St closed modestly higher on Tuesday as investors await inflation data and the Federal Reserve’s policy meeting outcome on the rate hike front next week. The S&P500 added 0.24% trading near a nine-month high, while the Nasdaq added 0.36% and the Dow Jones closed just 0.03% higher on Tuesday.
The 3-day ASX rally ended yesterday with the key index closing 1.20% lower as investors responded to the RBA rate hike announcement of a 25-basis point hike for June, in addition to RBA governor Philip Lowe flagging ‘further tightening of monetary policy may be required to ensure that inflation returns to the target 2-3% range in a reasonable timeframe’. The nation’s cash rate now sits at an 11.5 year high of 4.1% for June and is up 400-basis points since the RBA began raising rates last May.
The key drivers of the interest rate hike surround the tight labour market, low unemployment, which moved higher in April, and wages growth compared to low productivity output, which accelerated to a decade-high in the March quarter.
Dr Lowe said recent data indicated upside risks to the inflation outlook notably labour costs are rising ‘briskly’ with ‘growth in the public sector wages expected to pick up further and the annual increase in award wages was higher than it was last year’. While majority of economists were expecting a pause in the cash rate for June, some lifted their call to expect the hike on Friday last week after the Fair Work Commission announced a 5.75% raise in minimum wages, and CPI data last Wednesday came in hotter than expected. For those with a variable interest home loan, you’ll unfortunately feel a heavy brunt of this rate hike if/when the banks pass it on in full to loan customers, with the average loan of $500,000 incurring a $76 increase in monthly repayments after this rate hike, taking the total monthly increase to $1134 since the RBA began raising rates last May.
Retail spend has come down as the high cost of living pressures begin to bite, which is taking impact on Consumer discretionary stocks as the sector led the losses on the ASX yesterday. Stocks in this sector face some of the toughest headwinds from rate hike announcements with cost-of-living pressures depleting consumer demand for discretionary goods. Baby Bunting plunged over 23% on Tuesday after the infant goods retailer released a trading update and downgraded guidance amid muted sales growth.
Investors only bought into Utilities stocks yesterday given their defensive nature, meaning people still need the services such companies provide during all phases of the business cycle. On the commodities front this morning, oil is trading 0.81% lower at US$71.57/ barrel, gold is up 0.11% at US$1963/ounce and iron ore is up 2.84% at US$108.50/tonne. Iron ore hit a six-week high on Monday as the price rally this week has been sparked by hopes of a policy introduction in China through new measures to support the country’s property market.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open 0.34% higher.
- Taking a look at economic data out today, Australia’s GDP growth rate for Q1 is out just after midday with consensus expecting growth of 0.3% for Q1, down from a 0.5% expansion in Q4, which will mean the 6th consecutive period of economic growth but at a slower pace than prior expansions.
Trading Ideas:
- Bell Potter has reduced the price target on Adacel Technologies (ASX:ADA) from 85 cps to 80 cps and maintain a buy rating on the leading global provider of simulation and control systems for the civil aviation and defence sectors, due to the company announcing two new contract wins but downgrading its FY23 guidance given one of the contracts was awarded later than expected and also delays in the finalisation of a contract renewal.
US equities closed in the red in New York overnight, with the Dow Jones closing 0.6% lower and the S&P500 slightly down 0.2%, as industrials and financials led seven of the eleven industry sectors lower. The Nasdaq was down only 0.09%. US markets eased after Friday’s broad-based rally.
In Europe, markets also closed lower as investors digested the US debt ceiling agreement and euro zone inflation data, which showed inflation falling to its lowest level since February 2022. The STOXX 600 closed 0.5% in the red, following muted trading for most of the trading session. Oil and gas stocks were down the most, despite oil prices remaining in positive territory. Travel and leisure stocks were also lower.
What to watch today:
- The SPI futures are suggesting that our local market will drop 0.57% at the open this morning, following the broad decline across global markets overnight.
- In economic news today, the RBA will announce its cash rate decision. The consensus is that central bank will hold the cash rate at 3.85% this month. The GDP growth rate is not announced until tomorrow, so that may be contributing to the market expectations, waiting to see what GDP comes in at before announcing further hikes.
- And in commodities,
- Oil prices were trading more than 1% higher, as expectations of lower supply outweighed concerns over slowing demand.
- Gold is in the green following a modest weakening of the US dollar and a slight decline in US Treasury yields. This followed weak eco data in the US that reinforced the view that the Fed will pause the tightening cycle next week.
- And iron ore is also higher, recovering after hitting a 6-month low.
Trading Ideas:
- Bell Potter maintains a buy rating on Bega Cheese (ASX:BGA) after reviewing Bega opening farmgate agreements across all geographics, to derive a net movement in estimated FY24 farmgate costs relative to FY23 estimates. Bell Potter’s price target remains unchanged at $4.10, and at BGA’s current share price of $3.59, this implies 14.2% share price growth in a year.
- Bell Potter also maintains a Speculative buy rating on Frontier Digital Ventures (ASX:FDV) following an amended Subscription Agreement regarding the acquisitions of FDV portfolio companies and InfoCasas. They have lowered their valuation from $1.05 to $0.89, and at the stock’s current share price of $0.36, this implies 147.2% share price growth in a year.
Wall St ended Friday’s session on a high, with the key indices each adding over 1% and the Dow Jones jumping 2.1% as investors welcomed a mixed payrolls report with an unexpected rise in unemployment and a slowdown in annual wage growth, all signs that the Federal Reserve’s aggressive rate hike action is taking effect on cooling economic growth in the US. In May, the US economy added 339,000 jobs in a sign that the booming labour market in the US remains strong, however unemployment increased to 3.7% from 3.4% which was one of the fastest increases in unemployment since early in the pandemic. Some of the increase in unemployment could be driven by mass layoffs in the technology sector that have seen over 200,000 workers lose their jobs this year across the big and smaller tech names.
Over in Europe, markets closed higher on Friday as investors responded to US lawmakers passing a bill to raise the US debt ceiling and cap government spending for 2-years, just days before the potential default deadline date. The STOXX600 rose 1.5% led by mining, oil and gas stocks all rallying. Germany’s DAX rose 1.25% on Friday, the French CAC added 1.87% and, in the UK, the FTSE100 rose 1.56%.
OPEC+, a group of global oil producers, met in Vienna on Sunday to discuss output policy to stabilise oil prices which have been battered down in recent times by weakened demand out of China. At the meeting on Sunday, OPEC+ reached an agreement to extend output cuts announced in April this year of 1 million barrels per day into 2024 amid price instability of recent times and the potential for excess supply.
On the local index, Friday’s trading session ended the week on a positive note as the ASX closed 0.48% higher on the last trading session of the week, buoyed by a sharp rally for materials stocks on a rise in the price of iron ore. Consumer staples and health care stocks were the sectors that underperformed the local market on Friday.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open the first trading session of the week up 1.06% on the back of the global rally that ended last week on a positive note.
- On the commodities front this morning, crude oil is trading 3.31% higher at US$74.10/barrel, uranium is up 1.87% at US$54.60/pound, gold is up 0.11% at US$1949.63/ounce and iron ore is up almost 1% at US$105.50/tonne.
- On the foreign exchange front, AU$1.00 is buying, US$0.66, 92.51 Japanese Yen, 53.17 British Pence and NZ$1.09.
- Taking a look at economic data, Germany’s trade balance data is released today for April with the market expecting a decline in trade surplus to 15.1bn euros from 16.7 billion euros as the economy entered into a recession in recent weeks.
Trading Ideas:
- Bell Potter has increased the price target on Wisetech Global (ASX:WTC) from $60 to $74.25 and maintain a hold rating on the leading global provider of logistics software solutions following increased growth outlook for the company on the back of assumed greater penetration or success in both customs and compliance and landside logistics markets. This follows the announcement of a global customs rollout with Kuehne Nagel – the largest sea-freight forwarder in the world, and the acquisition of two landside logistics companies this half.
- And Trading Central has identified a bullish signal on Reece (ASX:REH) following the formation of a pattern over a period of 34-days which is roughly the same amount of time the share price may rise from the close of $18.32 to the range of $19.15 to $19.35 according to standard principles of technical analysis.
Well markets rebounded overnight, after falling the session prior. On Wall Street, all three major benchmarks closed in positive territory. The Nasdaq and the S&P500 closed at their highest levels since August, up 1.28% and 1% respectively, while the Dow Jones gained 0.47%. The rally was off the back of the bill to raise the debt limit and cap government spending being passed in the House by a wide margin late Wednesday in the US, sending the bill to the Senate only days before Monday’s default deadline.
European markets also rallied, after having hit a two-month low. The STOXX 600 closed 0.8% higher, as almost all sectors gained. Mining stocks rose after Chinese factory activity beat expectations. Media stocks were also up, while household goods closed lower.
What to watch today:
- The SPI futures are suggesting that our local market will rise 0.66% at the open this morning.
- Local economic news out today includes home loan data for May, while tonight in the US the unemployment rate will be announced.
- In commodities,
- Oil is on the rise, currently trading more than 3% higher, recovering from earlier losses after touching a two-month low in the previous session, supported by a weaker US dollar and market relief, following the US debt ceiling negotiations. Also, OPEC+ is meeting this week, so markets are awaiting potential price-supportive measures.
- Natural gas has fallen to the lowest level in four weeks, driven by record US output, increased gas exports from Canada as well as a higher-than-expected storage build last week.
- The gold price is higher, while iron ore is holding close to a six-month low.
Trading Ideas:
- Bell Potter maintain a Buy rating on AROA Biosurgery (ASX:ARX), a commercial stage medical device company that operates within the complex wound care and soft tissue reconstruction sector. They reported positive FY23 results, with revenue and EBITDA improvements. The FY23 performance was within guidance and largely in-line with Bell Potters forecasts. The price target is $1.45, and at the stock’s current share price of $0.92, this implies 58.5% share price growth in a year.
- And Trading Central identified a bullish signal in Pro Medicus (ASX:PME) indicating that the stock price may rise from the close of $61.65 to the range of $64.20 to $64.70 over 22 days, according to the standard principles of technical analysis.
European markets tumbled as concerns remained over the US debt ceiling bill ahead of the deadline of June 5th. German inflation data will also be out tonight as well as a euro zone flash reading.
Additionally, investors are weighing China’s manufacturing PMI data, that declined for the second straight month and at a faster rate than expected. The STOXX 600 closed the session down 1.1%, with all sectors in negative territory. Auto stocks led the losses, followed by chemicals stocks.
Over in New York, US equities also declined overnight. The Dow Jones fell 0.4%, the S&P500 down 0.6% and the tech heavy Nasdaq also down 0.6%.The close also marked the end of the May trading month, which saw the Nasdaq finish the month 5.8% higher, boosted by artificial intelligence-related stocks. The S&P500 added 0.3% in the month, while the Dow fell 3.5%.
What to watch today:
- Following global markets overnight, the SPI futures are suggesting our local market will drop 0.18% at the open this morning.
- In commodities,
- Oil has sharply fallen, now trading around US$68 a barrel, extending the monthly loss for May to nearly 11%. The decline is due to concerns surrounding a slowdown in demand, mainly from China, the top crude importer. So keep watch of energy producers such as Beach Energy (ASX:BPT) and Santos (ASX:STO).
- The gold price steadied overnight, so gold shares could have a decent run today. As market volatility leads to increased demand for the safe haven asset, its worth keeping your eye on Evolution Mining (ASX:EVN), Gold Road Resources (ASX:GOR), Regis Resources (ASX:RRL) and other gold stocks.
- And the price of iron ore is also down, now trading at US$103.50 per tonne, holding close to a six-month low, amid evidence of low demand and strong supply.
- In economic data, today we’ll receive retail sales data for Retail Sales data for April and Private Capital Expenditure data for Q1.
Trading Ideas:
- Bell Potter maintain their buy rating on IVE Group (ASX:IGL) with a price target of $3.00. They are the largest integrated marketing communications business in Australia with leading market positions across every sector in which the company operates. The company has been caught up in the recent broad sell-off of retailers following some soft trading updates, such as City Chic and Super Retail, as well as concern around reduced spending. Bell Potter have updated each valuation used in the determination of their price target for market movements and time creep, but overall, there is no change in the $3.00 price target. At the current share price of $2.28, this implies 31.6% share price growth in a year.
- And Trading Central have identified a bearish signal in Lindsay Australia (ASX:LAU) indicating that the stock price may fall from the close of $1.25 to the range of $1.11 to $1.15 over 31 days, according to the standard principles of technical analysis.
It was a very muted session on the ASX yesterday as the market quickly overcame the boost from US debt ceiling negotiations ending in an agreement to be presented to congress, and investors shifted focus ahead to next week’s rate hike decision out of the RBA and the potential for inflation to remain stickier down under for a little while longer.
The ASX fell 0.11% on Tuesday weighed down by a 0.88% fall in the REIT sector, while communications services stocks rose 0.62%.
Paladin Energy tanked over 20% on Tuesday before being put into a trading halt as investors fled the uranium miner on rumours that Namibia may follow the Chilean government move to nationalise some mining assets. Paladin’s Langer Heinrich Mine is in Namibia which is why investors fled the stock yesterday. The sell-off in miners with operations in South Africa extended to Syrah Resources who’s Balama Graphite operation is in Mozambique which is in the same region as Namibia.
AUSTRAC and embattled casino giant Crown proposed an agreed $450m penalty to Crown to cover breaches of anti-money laundering laws at the company’s Melbourne and Perth casinos. The matter will be heard in court on July 10 to July 11. On the economic data front yesterday, building approvals in Australia sunk 8.1% month-on-month in April and down 25.5% year-on-year, with private sector houses down 3.8%. The market was expecting a rise of 2%, but the sharp decline of 8.1% takes approvals for new home builds to the lowest level in 11-years, in a sign that appetite for building investment properties remains weak and will continue dragging on the economy.
Over in the US, stocks rallied in the early hours of trade as investor sentiment was high following the initial agreement being reached over the debt ceiling crisis. Tech stocks were the top performers led by an AI stock rally after Nvidia became the first chipmaker to join the trillion-dollar market capitalisation club last week. In afternoon trade the key indices pulled back as investors kept a close eye on the Fed’s debt ceiling debates and also on the outlook potential for another rate hike out of the Federal Reserve next month, with the Dow Jones closing Tuesday’s session 0.1% lower, while the S&P500 closed flat and the tech-heavy Nasdaq rose 0.3%.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the local index to open 0.5% lower on dampened global sentiment over the passing of the debt ceiling through congress.
And now let’s dive into some trading ideas for your consideration today. - On the commodities front this morning, oil has plunged 4.47% to trade at US$67.73/barrel ahead of OPEC+s meeting this Sunday and amid the US debt ceiling saga. Gold is up 0.81% at US$1958.61/ounce and iron ore is up 2.45% at US$104.50/tonne.
- AU$1.00 is buying US$0.65 cents, 91.81 Japanese Yen, 52.95 British Pence and NZ$1.08
Trading Ideas:
- Bell Potter has increased the price target on Clarity Pharmaceuticals (ASX:CU6) from $1.35 to $1.40 and maintain a speculative buy rating on the clinical stage radiopharmaceutical company following a report out of the company on progress in its latest clinical trial investing the use of its proprietary radiopharmaceutical for the treatment of metastatic castrate resistant prostate cancer. The update outlined Cohort 1 dosed 6 patients and the treatment was well tolerated, and Cohort 2 will now commence at a higher dose of the treatment.
- Trading Central identified a bullish signal on Service Stream (ASX:SSM) on the 30th of May following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may rise from the close of $0.64 to the range of $0.73 to $0.75 according to standard principles of technical analysis.
The ASX started the week on a very positive note after a late-night phone call on Saturday between US President Joe Biden and House Speaker Kevin McCarthy ended the months-long debt ceiling negotiations with a compromised, tentative outcome being agreed to. The US was just under 2-weeks away from running out of money to pay its bills according to Treasury Secretary Janet Yellen, so the last-minute dash to achieve an outcome to present to congress for passing has boosted sentiment in global markets to start the new trading week higher. The deal still must pass through congress but at least gives the parties a few years of buffer before these negotiations start again.
The ASX rose 0.88% to start the new trading week on a positive note with the debt ceiling agreement being the key driver of the ASX rallying. The debt ceiling agreement also sparked a rally for commodity prices too with oil up 0.67% to US$73.16/barrel and iron ore up 3.55% to US$102/tonne on positive demand outlook now the debt ceiling agreement has been reached. Real Estate stocks led the gains yesterday adding almost 2% on eased fears of global economic turmoil resulting from the lifting of the US debt ceiling, while materials stocks rose 1.62% and financials added almost 1.4% to start the week. The only sector that closed lower yesterday was consumer discretionary stocks. The debt ceiling agreement being reached doesn’t rule out a recession soon for the world’s largest economy, with analysts’ still factoring in a 68% chance of the US heading into a recession in Q3. Locally, the pressure is mounting for embattled accounting and consulting giant PwC Australia as the company directed nine senior partners to go on leave effective immediately following the company’s CEO, Tom Seymour, resigning over the tax law leaks three weeks ago. Acting PwC CEO Kristin Stubbins has issued an apology on behalf of the firm for sharing confidential government tax policy information and betraying the trust placed in the company. The scandal involves dozens of PwC partners receiving emails related to plans to use confidential government tax policy information in a bid to win new clients. And WA Premier Mark McGowan announced his shock resignation yesterday which may have some impact on the market in coming months as we assess how his successor takes forward or changes McGowan made especially in the mining sector.
US markets were closed on Monday for the Memorial Day holiday, but the expectation is for a rally on Tuesday in the US as investors respond to the debt ceiling negotiation agreement being reached. In Europe overnight, markets closed lower in the region as investors now shift focus to future rate hikes expected out of the European Central Bank and Bank of England, both of which were expected to pause and look to pivot before recent economic data complicated the outlook. Germany’s DAX fell 0.2% while the French CAC lost 0.21%. The UK market was also closed on Monday for the Late May bank holiday.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the local market to open 0.11% lower as global investors shift focus to rate hike outlook out of the key central banks in months to come.
- On the commodities front this morning, oil is trading 0.67% higher at US$73.15/barrel, gold is down 0.16% at US$1943.12/ounce and iron ore is up 3.55% at US$102/tonne.
- AU$1.00 is buying US$0.65, 91.81 Japanese Yen, 52.95 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased the price target on Catapult Group (ASX:CAT) from $1.00 to $1.20 and maintain a buy rating on the leading global provider of elite athlete wearing tracking solutions company following the release of Catapult’s FY23 results including wearables growing strong up 17% and the outlook for continual development of an advanced video analysis or insights tool called MatchTracker, which
US markets are set to rally on Monday following the conclusion of a length negotiations process over raising the U.S. debt ceiling which finally concluded on Saturday (US time). Stocks in the US rallied on Friday as investors grew hopeful of an outcome in the debt ceiling negotiations between President Biden and House Speaker Kevin McCarthy. The Dow Jones rose 1%, the S&P500 added 1.3%, and the tech-heavy Nasdaq rallied 2.2%. On Saturday night in the US, President Biden and Kevin McCarthy held a 90-minute-long phone call to discuss the deal where a compromise was reached and an agreement in principle has been decided. House speaker Kevin McCarthy expects congress to pass the debt deal, which is called a compromise and is good for the country because according to Biden, ‘it prevents what could have been a catastrophic default and would have led to an economic recession, retirement accounts devastates and millions of jobs lost’.
And over in Europe, markets closed higher as investors looked ahead to a crucial weekend for the U.S. debt ceiling negotiations. Technology stocks in the region rallied late in the week following the release of chipmaker Nvidia’s strong results. Germany’s DAX rose 1.2% on Friday, the French CAC rose 1.24% and, in the UK, the FTSE100 added 0.74%.
The local index closed 0.23% higher on Friday, buoyed by a rally for technology stocks, also on the back of Nvidia’s strong results which fuelled a rally for tech stocks around the world. Investor appetite is also growing for technology stocks as rate hike pauses and potential cuts are on the horizon in the future. Materials stocks also had a strong end to the week with the sector rising 0.93% on Friday on a solid rebound in the price of iron ore which has been slammed lately on weakened demand outlook out of China.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open almost 1% higher, driven by a boost in sentiment as debt ceiling negotiations come to a close.
- On the commodities front this morning, oil is trading 0.86% higher at US$73.32/barrel, coal is flat at US$160/tonne, gold is up 0.14% at US$1943/ounce and iron ore is up 3.55% at US$102/tonne.
- Stocks trading ex-dividend today include Dalrymple Bay Infrastructure and Infratil. If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- AU$1.00 is buying US$0.65, 91.83 Japanese Yen, 52.8 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has decreased the price target on Eagers Automotive (ASX:APE) from $15.25 to $15 but maintain a buy rating on the leading automotive retailer following the release of the company’s trading update at its AGM which was slightly below Bell Potter expectations with underlying NPAT before tax for the first four months of the year only in line with the PCP. Bell Potter expects a stronger H2 due to further improvement in deliveries from the big three – Toyota, Mitsubishi and Mazda as well as BYD.
- Trading Central has identified a bullish signal on APM Human Services International (ASX:APM) following the formation of a pattern over a period of 17-days which is roughly the same amount time the share price may rise from the close of $2.04 to $2.14 to $2.18 according to standard principles of technical analysis.
The Aussie share market declined 1.94% (Mon-Thu), as a sharp sell-off in materials stocks on the back of lower iron ore prices due to weakened demand from China's steel mills.
In this week's wrap, Grady covers:
- (0:11) Cost-of-living pressures in Australia
- (0:39) Why income stocks are gaining attention
- (1:19) Bell Direct's Strategy Builder
- (2:13) High dividend stock selection
- (4:11) The best performing companies in the ASX200
- (5:02) The most traded stocks & ETFs by Bell Direct clients
- (5:36) Three economic news items to watch out for
Read the transcript here.
In New York overnight, US equities closed mixed, as investors watch for debt ceiling updates. While the Dow Jones closed 0.11% lower, the S&P500 gained 0.9% and the Nasdaq advanced 1.7%.
European markets ended lower. The benchmark Stoxx 600 finished 0.24% lower after a choppy day, weighed down the most by oil and gas stocks, down around 2%.
What to watch today:
- The Australian market is set to open lower this morning, with the SPI futures suggesting a drop of 0.08%.
- As for companies to watch today, Fisher & Paykel Healthcare (ASX:FPH) will be releasing its earnings report today, and InvoCare (ASX:IVC) will hold its AGM today.
- In commodities,
- Oil prices have sharply fallen, ending a three-day winning streak, after the Russian Deputy Prime Minister ruled out additional production cuts by OPEC+.
- The Gold price is hovering at around US$1,941 an ounce, levels not seen in over two months, pressured by a rise in Treasury yields and the US dollar. Traders are also monitoring the ongoing debt ceiling conversations and the likelihood of prolonged higher interest rates.
- Iron ore is lower with reduced steel production in China and a decrease in supply disruptions.
Trading Ideas:
- Bell Potter maintains their Buy rating on Eagers Automotive (ASX:APE), after the company provided a trading update at its AGM which was slightly below Bell Potter’s expectations, with underlying net profit before tax for the first four months of the year only in line with the PCP. Bell Potter had been expecting some growth, but the first half has been negatively impacted by a number of issues including lower deliveries on key brands (e.g. Toyota, Mitsubishi and Mazda), two wet weather events in New Zealand and some cost pressies such as interest costs on inventory.
- Trading Central have identified a bullish signal in Lendlease Group (ASX:LLC), indicating that the stock price may rise from the close of $7.77 to the range of $8.60 to $8.75 over 8 days, according to the standard principles of technical analysis.
Wall St closed the midweek session lower, extending the debt ceiling talks-related sell off into Wednesday as another day passed and no set plan has been decided, which investors take as a sign of concern. House Speaker Kevin McCarthy said at a press conference late on Wednesday morning that negotiators remain at odds over a debt ceiling outcome. The US FOMC meeting minutes were also released in the early hours of this morning, outlining that the members are split on the need for the Fed to further raise interest rates in the future, which also weighed on investor sentiment in the US through afternoon trade. The Dow Jones closed 0.77% lower, the S&P500 fell 0.73% and the tech-heavy Nasdaq lost 0.61% lower on Wednesday.
Over in Europe, markets also closed lower again as investors see stalls in US debt ceiling negotiations as a concern ahead of the looming June 1 possible default date according to Treasury Secretary Janet Yellen. Germany’s DAX fell almost 2%, the French CAC lost 1.7% and, in the UK, the FTSE100 fell 1.75% on Wednesday. UK inflation data out overnight showed a decline from 10.1% year-on-year in March to 8.7% year-on-year in April, which shows signs of cooling but was above economists expectations of a drop to 8.2%.
The local market extended its red run into Wednesday as investors sold out of materials stocks on the back of concerns surrounding weaker demand out of China’s steel mills causing a decline in the price of iron ore. Healthcare stocks also fell 1.13% on Wednesday, while energy stocks rose 0.7% on the price of oil rising 1.76%. Consumer discretionary stocks also took a hit on Wednesday over concerns of mounting demand headwinds signalled by Universal Stores which caused a 24% plunge in the retailers’ share price.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the local market to open 0.43% lower as the debt ceiling driven sell-off continues around global markets.
- On the commodities front this morning oil remains strong, up 1.81% at US$74.23/barrel, coal is down 0.22% at US$160/tonne, gold is down 0.88% at US$1958/ounce and iron ore is down 2.83% at US$103/tonne.
- One Aussie dollar is buying US$0.65, 91.19 Japanese Yen, 52.86 British Pence, and NZ$1.07.
Trading Ideas:
- Bell Potter has downgraded its price target on EROAD (ASX:ERD) from $1.50 to $1.25 but maintain a buy rating on the fleet management technology company following the release of the company’s FY23 result which was in line with Bell Potter forecasts if not better in some metrics. The downgrade in price target comes amid the company’s EBIT loss of NZ$4.5m coming in larger than Bell Potter expectations of NZ$4.4m, and as a result Bell Potter has modestly adjusted forecasts for the company heading into FY24 and beyond.
- Trading Central has identified a bearish signal on Super Retail Group (ASX:SUL) following the formation of a pattern over a period of 70-days which is roughly the same amount of time the share price may fall from the close of $11.90 to the range of $9.90 to $10.30 according to standard principles of technical analysis.
Wall Street closed lower on Tuesday as negotiations over the debt ceiling appear to be making little progress. Monday’s meeting between President Biden and House Speaker Kevin McCarthy was productive with President Biden saying a default was off the table, however no set resolution has been decided yet. The S&P500 dropped 1.12%, the Dow Jones fell 0.69% and the tech-heavy Nasdaq lost 1.26%. And in Europe, markets closed lower on Tuesday as investors in the region also keep a close eye on US debt ceiling negotiations, whereby talks continue with no clear resolution in check yet.
The local market had a lacklustre session yesterday as a more than 1% loss in the consumer discretionary sector offset strong gains for financial and real estate stocks. Markets have been moving over the last week in line with progress and lack there of negotiations in debt ceiling talks between US President Joe Biden and House Speaker Kevin McCarthy. As negotiations on Tuesday were inconclusive, investor optimism took a slide and caused the negative end to a lacklustre session on the ASX. Qantas shares dipped over 2% on Tuesday despite the flying kangaroo forecasting it would reach up to $2.5bn in pre-tax profit for the 2023 financial year. Investor sentiment in the airline was shaken by the warning that softening fuel prices would put downward pressure on airfares, which in-term will cause a reduction in margins for Qantas. There is also more capacity coming online post-pandemic both through Qantas’ new fleet and as international carriers ramp up operations back into Australia, which will also contribute to the downward pressure on Qantas airfares in the highly competitive market.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open the midweek session almost half a percent lower on the back of the global market sell-off overnight as debt ceiling negotiations push on.
- On the commodities front this morning, oil is trading 1.01% higher at US$72.77/barrel following a sharp decline earlier this week amid weakened demand fears out of China as the country’s emergence out ofCOVID-19 lockdowns has been much weaker than expected. Gold is up 0.34% at US$1976.08/ounce and iron ore is down 2.3% at US$106/tonne.
- Taking a look at economic data out today, UK inflation rate data for April is released at 5pm AEST with consensus expecting a decline to 8.2% from 10.1% in March, in a sign the Bank of England’s rate hikes are taking effect on cooling inflation in the UK.
- AU$1.00 is buying US$0.66, 91.55 Japanese Yen, 53.47 British Pence and NZ$1.06.
- Stocks trading ex-dividend today include Orica (ASX:ORI), Nufarm (ASX:NUF) and Aristocrat Leisure (ASX:ALL). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has decreased the price target on IDP Education (ASX:IEL) from $30.45 to $30.00 and maintain a hold rating on the global education services provider following the company announcing the acquisition of UK-based technology company The Ambassador Platform in a deal worth $16.8m which IDP will fund through its existing cash balance. The slight decrease in price target comes off the back of the acquisition with factoring in the total consideration for the acquisition of 9 million pounds or the equivalent of $16.8m Aussie dollars.
- Trading Central has identified a bullish signal on APM Human Services International (ASX:APM) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may rise from the close of $1.95 to the range of $2.05-$2.07 according to standard principles of technical analysis.
It was a mixed session on Wall Street overnight as investors focus ahead to the pivotal debt ceiling negotiation talks at 5:30pm on Monday evening in the U.S. where President Biden will meet again with house speaker Kevin McCarthy to continue debt ceiling talks with just 10-days left until the earliest date that Treasury Secretary Janet Yellen said the US could default. The S&P500 rose 0.02% on Monday, the Dow Jones fell 0.42% and the tech-heavy Nasdaq rose 0.5%. Reporting season is coming to an end, but investors are still awaiting the release of first quarter earnings results out of Zoom Video, and Lowe’s. The US has also agreed to back the development of Australia’s critical minerals industry after the two country’s agreed to coordinate policies and investment to support the industry’s growth. This is a major deal for Australia’s local miners and producers as Australia supplies around half of the world’s lithium and other minerals like rare earths.
Over in Europe, markets closed mixed as investors in the region await key signs of progress toward raising the U.S. debt ceiling to avoid the catastrophic potential outcome of defaulting on debts. In Greece, the Athens General Composite Index soared 7% on Monday after the New Democracy, ruling Conservative Party, secured a firm lead in the elections on Sunday. Germany’s DAX fell 0.32% on Monday after closing at a record high on Friday, while the French CAC fell 0.18% but, in the UK, the FTSE100 rose 0.18%.
The local market closed the first trading session of the week 0.22% lower, weighed down by investors selling out of real estate and communication services stocks, which offset a 1.5% rally for the tech sector. Tyro Payments (ASX:TYR) tanked over 16% on Monday after Potentia Capital walked away from takeover talks with the payments company following Potentia’s completion of due diligence into Tyro. New regulations in the buy now, pay later sector also sent shockwaves through the share prices of key players like Zip Co (ASX:ZIP) and Block (ASX:SQ2), parent company of Afterpay. The regulations set to be imposed on the BNPL providers will include tougher requirements for credit checking to avoid consumers taking on unaffordable debt through use of the pay later options.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the local market to open 0.07% higher.
- On the commodities front this morning, oil continued its decline into a third day on Monday as investors continue to assess the stop-start negotiations underway in the US over the debt ceiling crisis. Investors are concerned about the impact the pending debt ceiling outcome will have on energy demand from China’s lacklustre economic recovery, in addition to the possibility of a recession in the US. Oil has rebounded this morning to trade 0.64% higher at US$72.15/barrel. Gold is trading 0.22% lower at US$1972.14/ounce and iron ore is down 1.81% at US$108.50/tonne.
- AU$1.00 is buying US$0.67, 92.16 Japanese Yen, 0.53 British Pence and NZ$1.06.
- Stocks trading ex-dividend today include Amcor (ASX:AMC) and Elders (ASX:ELD). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has increased the rating on AFT Pharma (ASX:AFP) from a hold to a buy and have increased the price target on the drug development company from $3.16 to $4 following the release of the company’s FY23 results including a 27% increase in product sales revenue to $156.5 million and a 180 basis points increase in gross profit margin to 46.3%. The company also has a short-term catalyst in October 2023 in the upcoming approval date for Maxigesic IV (4) in the US where commercial launch triggers a $6 million milestone.
- Trading Central has identified a bearish signal on Magell
The Aussie share market advanced 0.44% this week (Mon-Thu), led by the energy sector gaining almost 2% and the information technology sector adding 1.97%. Investors have regained appetite for technology stocks as inflation eases in the US.
In this week's wrap, Grady covers the:
- (0:17) US debt debate and important next steps
- (1:40) Bank of England's rate hike decision
- (2:17) Healthcare sector movers and shakers
- (4:22) Best performing stocks in the ASX200
- (5:29) Most traded stocks & ETFs by Bell Direct clients
- (6:01) Three economic news items to watch out for
On Wall Street overnight, US equities closed mixed. While the Nasdaq closed the higher, the Dow Jones closed more than 200 points lower, or 0.66%, the fourth straight day of losses, and the S&P500 dropped 0.17%. The major benchmarks were dragged down my Disney shares falling 8% the day after the media giant released its fiscal second-quarter results. The results showed that higher prices helped to narrow Disney’s losses, however subscriber growth was significantly lower. Disney is also taking on impairment charges of US$1.5 to US$1.8 billion, as the company removes more content from its streaming platforms.
Also overnight, the producer price index in the US, which is measuring wholesale prices, increased very slightly by 0.2% in April. This PPI data followed the consumer price index report out earlier this week, which showed that US inflation rose 4.9% from a year ago, which was below expectations.
European markets closed marginally lower, following the Bank of England’s interest rate hike, which was a 25-basis point hike to 4.5%. The announcement is in line with expectations in the UK, and is the 12th consecutive rate increase.
What to watch today:
- Following global markets overnight, the Australian market is set to open lower this morning, with the SPI futures suggesting a fall of 0.11%.
- In economic data today, Westpac’s consumer confidence data for May will be out at 11:30am AEST. Consumer confidence is expected to fall by 4.3% this month, after it rose by 9.4% in April to its highest since June last year.
- As for company announcements to watch out for today, News Corp (ASX:NWS) and REA Group (ASX:REA) are set to release quarterly earnings. And Ampol (ASX:ALD) and QBE Insurance (ASX:QBE) will hold their AGMs today.
- In commodities,
- Oil prices are lower, amid persistent demand concerns.
- Silver has sharply declined, retreating from a 14-month high as concerns of lower industrial demand outweighed the Fed’s dovish outlook.
- Copper is trading at its lowest level in four months, as low demand outweighed tight supply, and as the reopening of the Chinese economy has not lived up to expectations of a sharper recovery.
- And iron ore is currently flat, after rebounding from the five-month low touched last week on hopes that demand could pick up in the second quarter.
Trading Ideas:
- Bell Potter maintains its buy rating on Neuren (ASX:NEU) and have increased their 12-month price target from $13.67 to $16.50. At NEU’s current share price of $13.37, this implies 23.4% share price growth in a year.
- Trading Central has identified a bearish signal in South32 (ASX:S32), indicating that the stock price may fall from the close of $4.06 to the range of $3.50 to $3.60 over 13 days, according to the standard principles of technical analysis.
Next week, we’ll be brining you the Morning Bell in written format, while we are travelling for conferences, so keep an eye on Bell Direct’s social media platforms for our market commentary.
Wall Street closed mixed on Wednesday after US inflation data for April was released showing the CPI rose 4.9%, the lowest level since April 2021, which was also lower than economists’ expectations of a 5% rise. The reading remains above the Fed’s target zone however is a sign that that aggressive rate hike strategy so far, but the fed is starting to have an effect in cooling economic growth.
Over in Europe, markets closed lower as investors in the region digested the latest inflation report out of the U.S. Technology stocks in Europe rose as investors in the region, like in the U.S., saw the inflation reading as a positive sign for high growth stocks, while investors also await an interest rate decision out of the Bank of England today, which is expected to be a 12th consecutive rate hike.
The local market closed 0.12% lower on Wednesday, as a near 1% rise for healthcare stocks was offset by losses in the financials and communication services sectors. Healthcare stocks were boosted by the release of the Australian Budget on Tuesday with the inclusion of through $3.5bn to triple the bulk-billing incentive that GPs receive, and hundreds of millions to better coordinate healthcare through digitisation of records and increasing Medicare rebates. The government has also promised $263.8m over 4-years for a new lung cancer screening program, $113 million for the National Immunisation Program, and $445.1m for the Workforce Incentive Program to help practices employ nurses and other health professionals.
The local financial sector had a lacklustre Wednesday possibly due to a few reasons. Firstly, National Australia Bank (ASX:NAB) and Bank of Queensland (ASX:BOQ) went ex-dividend yesterday, which generally means the stock will trade lower on the ex-dividend date. Westpac (ASX:WBC) goes ex-dividend today and ANZ Group (ASX:ANZ) trades ex-dividend on the 15th May so we might see some slides in their respective share prices on those key dates.
What to watch today:
- On the commodities front this morning, oil is trading 1.24% lower at US$72.80/barrel, gold is down just 0.24% at US$2029/ounce and iron ore is flat at US$107/tonne.
- On the economic data front today, Westpac Consumer Confidence data for May is released with the market expecting a decline from 85.8 points in April to 82.1 points in May amid ongoing rate hikes out of the RBA and tough economic conditions. China’s inflation rate data for April is also released today with consensus expecting a decline to 0.4% from 0.7% in March. And the Bank of England will release its interest rate decision, with the market expecting a 25-basis point rate hike to be announced.
- The Aussie dollar is buying US$0.68, 91.07 Japanese Yen, 53.6 British Pence and NZ$1.06.
- Stocks trading ex-dividend today include Westpac Banking Corporation and Challenger. If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has decreased its price target on Appen (ASX:APX) from $2.25 to $2.05 and maintain a sell rating on the AI data services tech company after the company released a trading update saying ‘’the challenging external operating and macroeconomic conditions that were notes at the FY22 result have persisted into FY23’ and included results for the first four months of the year of NPAT dropping 24.7% and revenue down 21.4%.
- Trading Central has identified a bullish signal on Cleanaway Waste Management (ASX:CWY) following the formation of a pattern over a period of 51-days which is roughly the same amount of time the share price may rise from the close of $2.67 to the range of $2.90 to $2.96 according to standard principles of technical analysis.
The all-important Australian budget was released last night in the first surplus for 15 years at a figure of $4.2bn surplus for 2022-2023 and massively reduced budget deficits in the forecasted years to come, with the key winners being aged care workers through receiving a pay increase of 15%, women through cheaper childcare and funding toward boosting the number of women in apprenticeships, and all Aussies through a cost of living package worth $14.6bn. The surplus budget has been driven by high commodity prices, a strong jobs market and a boost in net migration.
The big banks have been caught up in a regional-banking fear sell-off over recent weeks and investors have responded negatively to some of the respective quarterly results updates, however for the likes of Westpac the latest results included a 22% jump in profit and the declaration of a 70-cps dividend. Investors have been hawk eyeing the big-banks provisions for doubtful debts which have risen and any declines in net interest margins which for NAB appear to have peaked, with NIM down at 1.77% and Bad and doubtful debts up to $393m, well above consensus expectations. CBA released quarterly results yesterday and despite profits jumping 10% on the PCP to $2.6bn, investors sold out as net interest margin came in 2% lower during the quarter and provisions rose to $5.7bn.
Over in the US today stocks closed lower as investors fear turbulence on the regional banking front, in addition to preparing for key inflation data readings out later this week in the form of US CPI and PPI readings. Investors are also keeping a close eye on the US debt ceiling progression. The Dow Jones fell 0.17% the S&P500 lost 0.46% and the tech-heavy Nasdaq fell 0.63% on Tuesday.
Investors in the US will be keeping a close eye on debates in the region over the coming weeks around the US debt ceiling, with US Treasury Secretary Janet Yellen saying failure to raise the debt ceiling would result in an economic catastrophe.
Over in Europe, markets closed lower as investors look ahead to US inflation data out this week, in addition to lower oil prices and weak Chinese trade data weighing on markets yesterday. Germany’s DAX closed flat, the French CAC fell 0.59% and, in the UK, the FTSE100 fell 0.18%.
The local index closed 0.17% lower yesterday, weighed down by a sell-off in real estate stocks possibly due to a number of reasons with investors maybe taking some profits from the rally in the sector last week, or the investor confidence in the sector sliding amid rising interest rates and predictions for an increasing number of defaults on mortgages to come.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open the midweek session 0.29% lower.
- On the commodities front this morning, oil is trading 0.51% higher at US$73.53/barrel, gold is up 0.76% at US$2036.69/ounce and iron ore is up 7.54% at US$107/tonne on speculation of additional policy support for China’s economic recovery.
- The Aussie dollar is buying US$0.68, 91.44 Japanese Yen, 53.96 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has downgraded the price target on Aeris Resources (ASX:AIS) from 95 cents per share to 89 cents per share following the release of the precious metal producer’s March quarter results including production of copper falling short of guidance and increased All-In-Sustaining-Costs higher than Bell Potter expected. The company also lowered its copper equivalent production and EBITDA guidance for FY23.
- Trading Central has identified a bearish signal on Myer (ASX:MYR) following the formation of a pattern over a period of 76-days which is roughly the same amount of time the share price may fall from the close of $0.81 to the range of $0.50 - $0.56 according to standard principles of technical analysis.
In New York overnight, there was little change as investors look ahead to key inflation readings, including April’s consumer price index report. The S&P500 closed with a small gain of 0.05%, the Nasdaq added 0.18% and the 30-stock Dow Jones closed 0.17% lower.
European markets closed higher as traders digested rate hikes by the Federal Reserve and the European Central Bank at the end of last week. Traders now look ahead to more corporate earnings, economic data, and a Bank of England rate decision this week.
What to watch today:
- The Australian market is set to open higher this morning, with the SPI futures suggesting a rise of 0.42%.
- Today watch Commonwealth Bank (ASX:CBA)’s share price movements as they’re set to release their quarterly report. Yesterday, Westpac announced a $4 billion profit from October to March, 22% higher than the corresponding amount from the previous financial year.
- Coronado Global Resources (ASX:CRN) is also reporting today.
- In commodities,
- The price of oil has rebounded further from a one-and-a-half year low on a weaker US dollar, expectations of supply cuts by OPEC and as concerns eased over an economic downturn in the US economy.
- Gold is also trading higher, recovering some earlier losses from the previous session. Last week, gold reached nearly record highs after the Fed announced the 25-basis point hike.
- And iron ore is trading at its lowest level in five months, due to evidence of low demand from Chinese steelmakers.
Trading Ideas:
- Bell Potter maintains a BUY rating on Lynas Rare Earths (ASX:LYC) and have increased their price target by 11% to $8.90. At LYC’s current share price of $7.37, this implies 21% share price growth in a year.
- And Trading Central have identified a bullish signal in Region Group (ASX:RGN) indicating that the stock price may rise from the close of $2.56 to the range of $2.76 to $2.80 over 50 days according to the standard principles of technical analysis.
It was turbulent week on global markets last week following the announcements of rate hikes across the major global markets which in some cases were expected, while others, like out of the RBA, came as a shock to investors.
Wall St rallied on Friday after robust jobs data indicated the economy is faring better than expected despite the Fed’s aggressive rate hike stance to date. April’s job data for the US showed jobs growth accelerated by 253,000 new jobs in April, unemployment fell to 3.4% and wage gains increased solidly regional banks felt some much-needed relief across the US on Friday on analysts’ upgrading a number of banks believed to have been oversold. PacWest Bankcorp soared almost 82% while Western Alliance jumped 49.2%. Apple shares lifted over 4.5% on Friday after the tech giant released quarterly results including sales declining just 2.5% which beat expectations. The Dow Jones industrials index added 1.7% in its biggest 1-session rise since January 6th, while the S&P500 rose 1.9% and the tech-heavy Nasdaq added 2.3%.
Over in Europe markets also closed higher on Friday as investor assess the monetary tightening cycle in the region and await key economic data out this week. German activewear giant Adidas lifted 8% on Friday after releasing better-than-expected results. Germany’s DAX added 1.44% on Friday, the French CAC rose 1.26% and, in the UK, the FTSE100 rose almost 1%.
The local market closed 0.37% higher on Friday, led by a surge in REIT stocks with the sector adding over 2%, while technology, consumer discretionary and communication services stocks offset some of the market’s gains, with these sectors ending Friday’s session in the red.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open 0.89% higher to start the new trading week higher on the back of Friday’s global rally.
- On the commodities front this morning, oil has rebounded from last week’s slump to trade 4.05% higher at US$71.34/barrel, gold is down 1.7% at US$2016.28/ounce and iron ore is own 3.86% at US$99.50/tonne.
- On the economic data front today, NAB Business Confidence data for April is released today with the forecast of a rise to 1 point from -1 point in March, in a sign the market expects conditions to begin easing for local businesses.
- The Aussie dollar is buying US$0.68, 91.13 Japanese Yen, 52.67 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has downgraded its price target on Janus Henderson (ASX:JHG) from $43.81 to $41.29 following the release of the company’s first quarter results. Bell Potter noted that while the company continues to make progress on the new strategy, short-term investment case remains relatively weak, with uncertainty on performance fees, no operating margin improvement and no obvious catalyst to spark re-rating.
- Trading Central has identified a bullish signal on Region Group (ASX:RGN) following the formation of a pattern over a period of 45-days which is roughly the same amount of time the share price may rise from the close of $2.53 to the range of $2.65 to $2.69 according to standard principles of technical analysis.
The Aussie share market declined this week, falling 1.6% (Mon-Thu), with only the utilities sector making gains. Financials and energy weighed down on the market the most. Also contributing to the market's decline were interest rate hike announcements in some of the key markets around the world.
In this week's wrap, Sophia covers:
- (0:22) The RBA's unexpected announcement
- (1:14) What happened to banking stocks this week
- (1:51) The impact of recent moves by the Federal Reserve
- (4:21) The best performing stocks in the ASX200
- (4:43) The most traded stocks & ETFs by Bell Direct clients
- (5:23) Five economic news items to watch out for
Wall Street closed the midweek session in negative territory after the Federal Reserve announced a 25-basis point rate hike overnight, marking the 10th straight rate hike in the US in a bid to tackle the country’s 40-year high inflation. Early investor optimism was dented after Fed Chair Jerome Powell ruled out cutting interest rates as he doesn’t expect inflation to fall quick enough. The Dow Jones industrials index fell 0.8%, the S&P500 lost 0.7% and the tech-heavy Nasdaq dropped 0.46%. While interest rates have risen again in the US, there are signs of the tight labour market loosening as US job openings fell for a third straight month in March and layoffs increased to the highest level in more than 2-years. The manufacturing sector is also contracting, and the consumer is struggling with the rising cost of living in the world’s largest economy. On the contrary, the US ISM Services PMI increased to 51.9 points in April from 51.2 points in March, which was higher than expectations and marks the fourth consecutive month of growth in the services sector.
The local market closed almost 1% lower on Wednesday in the aftermath of the RBA’s shock 25-basis point rate hike announcement on Tuesday. Further turbulence in the US banking sector and a slump in oil prices caused investors to flee financial and energy stocks on Wednesday, while communications services and consumer staples stocks were the only sectors to end the midweek session in the green. The energy sector dived over 2% on Wednesday as oil fell 1.5% on Wednesday to US$70.60/barrel amid concerns about the US economy discussing ways to avoid a debt default and investors preparing for further rate hikes to come in the region. US Treasury Secretary Janet Yellen said the US government could run out of money within a month while the White House said President Joe Biden would not negotiate over the debt ceiling, but said he will discuss starting a ‘separate budget process’. While it was a red day on the ASX yesterday, gold stocks rallied as investors shifted into the safe-haven assets amid rising fears of further banking turbulence to come. Gold Road Resources led the winners on the local bourse yesterday, rising 4.68%, while West African Resources added 4.28% and Evolution Mining lifted 3.74%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open almost half a percent lower on Thursday.
- On the commodities front this morning, the price of oil has dived over 8% to trade at US$65.99/barrel following the Fed’s rate hike decision, while gold is up 1.7% at US$2050/ounce and iron ore is flat at US$105/tonne.
- The Aussie dollar is buying US$0.67, 89.65 Japanese Yen, 53.20 British Pence and NZ$1.07.
- Stocks trading ex-dividend today include Jupiter Mines (ASX:JMS) and Waterco (ASX:WAT). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bearish signal on Fortescue Metals Group (ASX:FMG) following the formation of a pattern over a period of 29-days which is roughly the same amount of time the share price may fall from the close of $19.99 to the range of $16.60 to $17.20 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Nine Entertainment (ASX:NEC) following the formation of a pattern over a period of 202 days which is roughly the same amount of time the share price may fall from the close of $2.03 to the range of $1.57 to $1.65 according to standard principles of technical analysis.
The Federal Reserve meeting has kicked off, which saw European markets close lower, with oil and gas stocks weighing down on the market the most.
In the US, the Dow Jones tumbled more than 300 points or 1.08% amid concerns on the banking sector and ahead of the Fed’s rate decision. The S&P500 and the Nasdaq also both declined more than 1%.
What to watch today:
- The SPI futures are suggesting our local market will drop 0.56% at the open, following the global sell-off.
- Looking at commodities,
- Oil has sharply fallen further, currently trading 5.4% lower at around US$71.56 per barrel. This marks a five-week low and is due to concerns about a possible recession resulting from interest rate hikes by central banks, as this could ultimately affect energy demand. The RBA unexpectedly raised rates yesterday, and the Federal Reserve and the European Central Bank are set to make announcements this week.
- Meanwhile iron ore is trading flat.
- Gold is approaching a 13-month high due to evidence of a slower job market, and concerns over small-cap US banks.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Pentanet (ASX:5GG). The company is a licensed telecommunications carrier and cloud gaming provider based in Perth. 5GG released a third consecutive flat quarterly update, as the company is focusing on increasing its capacity to serve higher margin on-net subscribers. Bell Potter’s recommendation is based on a successfully scaled rollout of the company’s next-gen network and cloud gaming services, which can meet global tends in entertainment and data proliferation from evolving media consumption. They have lowered their valuation to $0.12, and at the stocks current share price of $0.08, this implies 46.4% share price growth in a year.
- Trading Central has identified a bearish signal in Woodside Energy (ASX:WDS) indicating that the stock price may fall from the close of $33.38 to the range of $31.40 to $31.80 over 7 days according to the standard principles of technical analysis.
The ASX started the week on a positive note closing yesterday’s session in the green. Utilities led the market yesterday, while tech stocks came under pressure. Gold stocks were also sold off with the price of the commodity down almost half a per cent.
Energy stocks advanced on the price of oil rallying more than 2% on Friday following strong earnings results out of the U.S. Yesterday however, oil fell 1.4% to trade below US$76/barrel on weak Chinese manufacturing activity data.
Overnight, US equities declined as investors prepare for the Fed’s meeting. Investors were focused on the banking sector, following the announcement that JP Mogan won the auction for First Republic Bank.
On another note, investors are also watching out for news on the debt ceiling, after Treasury Secretary Janet Yellen warned the US may run out of measures to pay its debts as early as June 1st.
What to watch today:
- Following New York overnight, the SPI futures are suggesting the Australian market will open 0.07% lower this morning.
- In commodities:
- Oil has extended a two-week decline, as unexpected weak manufacturing Chinese data raised demand concerns for the crude importer.
- Iron ore continues to decline due to the low demand from Chinese steelmakers.
- Looking at the gold price – overall for April, the gold price increased for the second consecutive month. Currently however, gold is trading lower as investors await another rate hike by the Fed this week. The Fed is widely expected to raise rates by 25 basis points on Wednesday, in response to robust US economic data and persistent inflationary pressures.
- That brings us over to economic news this week, as other central banks including the European Central Bank and the RBA are also announcing monetary policy decisions this week. At 2:30pm today, the RBA will announce the latest interest rate decision for May with much of the market now expecting a second consecutive pause.
Trading Ideas:
- Bell Potter have upgraded their recommendation on GrainCorp (ASX:GNC) from a Hold to a Buy, and maintain their price target of $8.00. At the stock’s current share price of $6.95, this implies 15.1% share price growth in a year.
- Trading Central has identified a bearish signal in oOh media (ASX:OML) indicating that the stock price may fall from the close of $1.61 to the range of $1.50 to $1.52 over 20 days, according to the standard principles of technical analysis.
The Australian market is set to start the week higher, after Wall Street ended last week with all three major benchmarks rallying. The Dow Jones had its best month since January, gaining 250 points, while the S&P500 closed 0.8% higher and the Nasdaq up 0.7%.
What to watch today:
- This morning, the SPI futures are suggesting that our local market will rise 0.74% at the open.
- In commodities,
- Oil has advanced almost 3%, regaining earlier losses, after prospects of a global economic slowdown hurting energy demand, weighed signs of tightening supplies.
- Gold is also in the green as heightening global economic uncertainties and a weaker US dollar lifted demand for the safe-haven asset.
- Iron ore has fallen a further 2.8%, now trading around US$105 per tonne, the lowest since early December, as a demand downturn from steelmakers risked the oversupply of iron ore.
Trading Ideas:
- Bell Potter maintains their Buy rating on Perpetual (ASX:PPT), after the company’s Q3 update showed Funds Under Management in the asset management business increased to $210 billion, a 4% increase over the quarter based on the proforma PPT Assets Under Management of $93.7 billion after the inclusion of $110.2 billion of Funders Under Management from Pendal. Bell Potter says that they believe the shares were heavily sold off in late 2022 over fears of continued outflows and doubts about the achievability of the merger. They have increased their 12-month price target by 3% to $30.60, and at PPT’s current share price of $24.53, this implies 24.8% share price growth in a year. They expect the shares to perform well as investors realise the value being created in the combined business.
- Bell Potter also maintain a Buy rating on Telix Pharmaceuticals (ASX:TLX), following the recent quarterly report which delivered a 20% beat against Bell’s revenue targets, FY23/24 revenues are upgraded by 24% and 29% respectively, along with large increases to earnings. Bell Potter’s price target has been upgraded by 55% to $14.00, and at the stock’s current share price of $10.15, this implies 37.9% share price growth in a year.
The Aussie share market declined this week, falling 0.5% (Mon-Thu), as the materials sector weighed down on the market the most, dropping 2.2%. Financials, consumer discretionary and utilities are also lower, while communication services and industrials advanced.
In this week's wrap, Sophia covers:
- (0:16) The demand outlook from the leading iron ore importing country
- (1:08) China's crippling property market
- (1:49) Bell Potter's forecast for Mineral Resources (ASX:MIN)
- (2:48) The best performing stocks in the ASX200
- (3:57) The most traded stocks & ETFs by Bell Direct clients
- (5:00) Four economic news items to watch out for
In New York overnight, markets had a strong run with all three major benchmarks closing with strong gains. The Dow Jones and the S&P500 both had their best session since January, closing 1.6% and 1.96% higher respectively. Meanwhile the Nasdaq rallied 2.43% higher, as strong results from Meta Platforms boosted tech-related companies. Meta shares leapt 14%, after the company reported quarterly revenue that topped expectations, and issued a positive forecast.
European markets were also in the green, as strong corporate earnings overcame the concerns around the US banking sector.
What to watch today:
- The Australian market is set to jump 0.75% at the open this morning, following Wall Street’s advance.
- In commodities,
- Oil is trading higher, after losing nearly 6% in the past two sessions, as recession fears and renewed concerns about the banking sector outweighed falling US inventories and the prospect of weaker global supplies. The US oil benchmark also gave up all the gains from earlier this month when OPEC+ announced a surprise production cut.
- Gold is at its lowest level in over three weeks with a rebound in risk sentiment and expectations of tighter monetary policy from the Fed.
- And iron ore prices fell under US$110 per tonne, the lowest since December, as a demand downturn rom steel makers risked the oversupply of iron ore.
- Quarterly reports from the following companies are set to be released today, so keep watch of the share price movements of these stocks. These include Coles (ASX:COL), IGO (ASX:IGO), Mirvac Group (ASX:MGR), Origin Energy (ASX:ORG), Oz Minerals (ASX:OZL), ResMed (ASX:RMD) and Volpara Health Technologies (ASX:VHT).
Trading Ideas:
- Bell Potter have a Speculative Buy rating on PointsBet Holdings (ASX:PBH), after a recent media report suggested the company could be considering a potential sale of its US business for around US$500 million. Bell Potter says the value looks reasonable or even conservative if other media reports are accurate. The company has also considered the potential sale of its Australian business for around AUD $250 million. Bell Potter have increased their valuation from $2.75 to $3.00, and at the stock’s current share price of $1.65, this implies 81.8% share price growth in a year.
- Trading Central have identified a bearish signal in Austal (ASX:ASB) indicating that the stock price may fall from the close of $1.65 to the range of $1.46 - $1.50 over 18 days, according to the standard principles of technical analysis.
Wall Street wavered during the midweek session before closing mixed as investors fears of a banking crisis rise on the back of First Republic Bank’s first quarter results and subsequent 49% decline on Tuesday. Upbeat earnings out of Alphabet, Microsoft and Boeing softened the sharp losses but weren’t enough to turn Wall Street positive at the closing bell on Wednesday. At the closing bell, the Dow Jones fell 0.68%, and the S&P500 lost 0.38%, but the tech-heavy Nasdaq added almost half a percent buoyed by strong earnings results.
Over in Europe, markets closed lower as investor fears of a banking crisis worsened. London-listed bank Standard Chartered posted a 21% rise in pre-tax profit which beat estimates and helped restore some relief in the European banking sector. Germany’s DAX ended the midweek session down 0.48%, the French CAC dropped 0.86%, and in the UK, the FTSE100 fell 0.49%.
The local market rallied after midday yesterday following the release of Australia’s inflation data for Q1, showing inflation cooling to 7% over the twelve months to the March quarter, in a sign inflation has peaked down under. Quarter-on-quarter, inflation rose 1.4%, with the highest price rises from Medical and hospital services, up 4.2%, tertiary education, up 9.7%, and gas and other household fuels, up 14.3%. The rise to 7% for the March quarter was slightly above consensus expectations of a rise to 6.9% but does show inflation is beginning to cool.
The rise in medical and hospital services is to be expected in the March quarter as this is generally the period GPs and other health service providers review their fees, and the Medicare Safety Net is reset at the start of every calendar year. Tertiary education fees are also indexed at the start of the year. The significant rise in gas and other fuel costs reflects major events over the past year globally including Russia’s war with Ukraine and unplanned outages at coal fired power stations according to the ABS. At the closing bell of the midweek session though, a sharp sell-off in Utilities stocks weighed the local bourse down to close 0.08% lower.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the local index to open 0.22% lower to start Thursday’s trading session in the red.
- On the commodities front this morning oil continues to trade sharply lower, down 3.68% at US$74.23/barrel, gold is down 0.41% at US$1989.7/ounce and iron ore is down 2.74% at US$106.50/tonne.
- On the economic calendar today, US GDP growth rate data for Q1 is released tonight with consensus expecting a decline in economic expansion to 2% from 2.6% in Q4.
- On the Aussie dollar front, AUD$1.00 is buying US$0.66, 88.32 Japanese Yen, 53.43 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased its price target on Gold Road Resources (ASX:GOR) from $1.90 to $2.05 and maintain a buy rating on the gold miner following the release of the company’s Q1 results including record quarterly free cash flow of $44.2m which beat Bell Potter expectations. The company also maintained production guidance and ended the quarter with cash and equivalents of $128m, up $47m. GOR is debt free and updated on retained stockpiles at Gruyere which stand at 5.9 million tonnes at 0.72 grams per tonne which provides an ongoing buffer against mining disruption.
- Trading Central has identified a bearish signal on Rio Tinto (ASX:RIO) following the formation of a pattern over a period of 94-days which is roughly the same amount of time the share price may fall from the close of $111.94 to the range of $98-$101 according to standard principles of technical analysis.
Wall Street closed lower on Tuesday as investor fears of a banking crisis reignited. Shares in First Republic Bank tanked more than 49% on the release of the regional bank’s latest quarterly results including deposits dropping 40% to US$104.5bn in Q1 but have since stabilised and the bank is instilling cost cutting measures including cutting head count by 20% to bolster its balance sheet. The results spooked investors about broader weakness in the banking sector following the recent collapses of Signature Bank and Silicon Valley Bank. The results are the first time this earnings season we have seen investors react as it has been a very uneventful reporting period so far.
The local market was closed yesterday for the ANZAC day public holiday but has started the week on a very turbulent note after some of the key iron ore miners revealed that production was lower in the March quarter, which comes at the same time iron ore slumped to its lowest level since December last week due to weaker-than-expected demand from Chinese steel mills and reports of stockpiles at ore ports. South32 was the worst performer, dropping 7.4% on Monday after revealing lower production of iron ore this quarter, while BHP Group (ASX:BHP) and Fortescue Metals Group (ASX:FMG) each fell 2% and 3.4% on Monday respectively. The red-hot lithium stocks of 2022 have continued coming under pressure in recent days after Chile’s government, which geographically boasts the world’s second largest reserves of lithium, announced a new plan for the country to take a majority stake in all lithium projects in the region. This bid for state control in Chile could be a positive for local Australian lithium miners and producers as it may push up prices of the green commodity and divert capital to other producers like in Australia.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the local index to start the midweek session 0.52% lower on the back of global market turbulence overnight.
- On the commodities front this morning, oil remains under pressure this morning, trading 2.08% lower at US$77.12/barrel, gold is up 0.4% at US$1996.91/ounce and iron ore is sharply lower, down 5.6% at US$109.50/tonne.
- On the Aussie dollar front, AUD$1.00 is buying US$0.66, 88.40 Japanese Yen, 53.57 British Pence and NZ$1.08.
- On the economic data front today we will see investors respond to Australia’s inflation rate data for Q1 released just after midday AEST with consensus expecting a fall to 6.9% for Q1 from 7.8% in Q4, which if it comes in at that level will imply inflation has peaked down under and the RBA’s rate hiking efforts are working. This data will also play a role in determining the RBA’s move next week on Tuesday as to whether another 25-basis point rate hike is required or if the pause can continue.
- The S&P Global Flash US Composite Purchasing Manufacturers Index climbed to an 11-month high of 53.5 in April, following 52.3 in March – indicating the business conditions remain resilient including and provides another case for the Fed to continue raising interest rates in
Trading Ideas:
- Bell Potter has increased its rating on Cyclopharm (ASX:CYC) from a hold to a buy and has raised the price target from $1.70 to $2.80 on the medical device company following the FDA notifying the company that its response for the New Drug Application for Technegas is now complete and eligible for review with a goal date for the announcement of a potential approval of 29th September 2023.
- Trading Central has identified a bullish signal on Flight Centre (ASX:FLT) following the formation of a pattern over a period of 25-days which is roughly the same amount of time the share price may rise from the close of $19.19 to the range of $20.80 to $21.10 according to standard principles of technical analysis.
Wall Street ended little unchanged across the key indices on Friday, but down for the week as investors assessed mixed corporate earnings results against the increasing chance of a recession in the U.S. later this year. Shares in Proctor & Gamble (ASX:PG1) rose 3.5% on Friday after it reported a sales boost from higher prices introduced across the portfolio of consumer products. Albermarle (ASX:ALB), the world’s largest lithium producer, on the other hand tanked 10% after Chile said it would nationalise its lithium industry, a key operational region for Albermarle over the last 40-years.
Earnings season in the US has broadly kicked off in a very uneventful manner, with investors believing profits beating expectations are unsurprising as the expectations were set very low amid the high interest rates, and high-cost environment.
Over in Europe, markets closed higher as investors responded to corporate earnings results released in the region. German software giant SAP rose 5% on Friday after reporting higher revenue and operating profit that beat expectations, while Swiss building materials manufacturer Holcim also beat expectations for profits and revenue as well as raising its guidance.
Germany’s DAX rose 0.54% on Friday, the French CAC added 0.51% and, in the UK, the FTSE100 climbed 0.15% on Friday.
The local market closed almost half a percent lower on Friday as the miners and bankers weighed on the local bourse. A build up in port inventories of iron ore and lowered demand from Chinese steel mills caused a drop in the price of iron ore to a four-month low, which caused investors to sell out of materials stocks on Friday.
What to watch today:
- Ahead of the local session here in Australia, the SPI futures are anticipating the ASX to open 0.11% lower on the back of Wall Street’s turbulent end to last week.
- Taking a look at commodities this morning, oil is down 0.2% at US$77.80/barrel, gold is up just 0.03% at US$1982/ounce and iron ore is sharply lower, down 3.33% at US$116/tonne amid stockpiles in port inventories.
- On the foreign exchange front, AU$1.00 is buying US$0.67, 89.69 Japanese Yen, 53.45 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has decreased its price target on Lynas Rare Earths (ASX:LYC) from $8.06 to $8 but maintain a buy rating on the rare earths company following the release of the company’s quarterly report including the highest ever output of NdPr from its Malaysia plant. Bell Potter’s price target downgrade is due to the uncertainty faced for the company’s Malaysia plant which could face a potential forced shutdown from July 1 due to domestic regulator concerns about radiation levels from the process of cracking and leaching. The next 6-months will be a transitional period for Lynas and remains a high-risk to earnings as the company relocates its cracking and leaching operations from Malaysia to Australia.
- Trading Central has identified a bullish signal on Hearts & Minds Investments (ASX:HM1) following the formation of a pattern over a period 187-days which is roughly the same amount of time the share price may rise from the close of $2.40 to the range of $2.75-$2.83 according to standard principles of technical analysis.
The Aussie share market traded flat this week, rising just 0.01% (Mon-Thu), as a rally in Financial, REIT and consumer discretionary stocks was offset by the energy sector plunging over 2.8%. Energy stocks were rocked by falling commodity prices, especially gas dropping on news of a global oversupply, while oil prices dropped over 2% later in the week.
In this week's wrap, Grady covers:
• (0:48) Why has the healthcare sector outperformed the broader market
• (1:59) Neuren & Telix Pharmaceuticals making sound progress
• (4:11) The best performing stocks in the ASX200
• (5:03) The most traded stocks & ETFs by Bell Direct clients
• (5:38) Three economic news items to watch out for
US equities closed lower overnight, with all three major benchmarks in the red. The decline followed a mixed bag of corporate earnings, including disappointing results from Tesla, which showed a fall in net income, and the company’s announcement of further price cuts. CEO Elon Musk stated that he was willing to sacrifice margins in a push for market share. All three major averages are on track for a week of losses. The Dow and the S&P500 on track for their worst weekly performances since March.
European stocks were mostly lower and investors are considering the outlook for interest rates, after UK inflation unexpectedly held above 10%, while wage rises slowed by less than expected.
What to watch today:
- The SPI futures are suggesting the Australian market will drop 0.52% at the open this morning, following the broad selling globally overnight.
- In commodities:
- Oil prices have sharply fallen to a nearly-three week low, pressures by lingering concerns that higher interest rates could dampen growth and impact demand.
- Meanwhile gold is trading higher, recovering from yesterday’s losses to trading at around US$2,000 an ounce, as the US dollar declined, and yields eased.
- Iron ore is higher, bouncing back above the US$120 per tonne mark, however remains close to the 3 ½ month low hit earlier this week.
Trading Ideas:
- Bell Potter maintain a buy rating on Allkem (ASX:AKE), expecting cash generation to lift substantially from 2023 with ongoing strength in lithium demand, commodity prices and production growth. AKE is aiming to maintain 10% share of supply in a global lithium market experiencing unprecedented growth. Bell Potter have increased their price target from $18.61 to $19.89. At AKE’s current share price of $11.64, this implies 71% share price growth in a year.
- Trading Central have identified a bullish signal in Flight Centre (ASX:FLT), indicating that the stock price may rise from the close of $18.94 to the range of $21.20 to $21.70 over 30 days, according to the standard principles of technical analysis.
Wall Street had another lacklustre session overnight as investors continue to assess first quarter results as earnings season ramps up into full swing. The Dow Jones industrials index lost 0.23%, the S&P500 fell 0.01% and the tech-heavy Nasdaq gained 0.03%.
Netflix and Morgan Stanley headlined the results released on Wednesday. Netflix shares fell 3.2% after the streaming giant pushed back plans to crack down on password sharing, but for the quarter Netflix beat analysts’ estimates on earnings per share.
Morgan Stanley shares rose 0.7% despite the big bank reporting weaker-than-expected margins for investment banking, wealth, and asset management. This earnings season investors are looking out for slowing earnings growth and signs of weakening demand likely to hit corporate profits in the second half of FY23 as the Fed continues its rate hike path toward the end of the tightening cycle.
Over in Europe, markets closed mixed as investors digested the latest CPI data out of the UK. UK CPI or inflation data came in at 10.1% for March, down from 10.4% in February but well above economists’ expectations of a fall to 9.8%, in a sign inflation remains stubbornly high in the UK. Data out on Tuesday though showed wages growth in the UK slowed by less than expected in the three months to March which may encourage the Bank of England to continue raising rates at the next monetary policy meeting. Germany’s DAX rose 0.08%, the French CAC added 0.21% and, in the UK, the FTSE100 fell 0.13%.
On the local bourse yesterday, it was a muted day on the ASX, with the key index closing 0.07% higher as strong gains for materials stocks were offset by sharp losses in the consumer discretionary sector. Gold stocks did most of the heavy lifting yesterday amid a rise in the price of the precious commodity, while Telix Pharmaceuticals (ASX:TLX) was the top performing stock for a second straight session after releasing record-setting results to start the week.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.09% lower following lacklustre sessions on global markets overnight.
- On the commodities front this morning oil is trading 2.26% lower at US$79.03/barrel, gold is down 0.51% at US$1994.70/ounce and iron ore is up 2.54% at US$121/tonne.
- AU$1.00 is buying US$0.67, 90.43 Japanese Yen, 53.93 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has increased its price target on RMA Global (ASX:RMY) from 20 cps to 21 cps and maintain a speculative buy rating on the company amid the digital real estate marketing company’s success in penetrating the large US market including US claimed profiles growing to 250,000 up 6.4% quarter-on-quarter, while US reviews increased 97% year-on-year.
- Bell Potter has downgraded its price target on Frontier Digital Ventures (ASX:FDV) from $1.23 to $1.05 but maintain a speculative buy rating on the company following the company completing a capital raise and the headwinds faced through difficult trading conditions in Pakistan.
The RBA meeting minutes for April were released yesterday which spooked the market into sell-off mode with hints that the RBA is eyeing off further rate hikes after pausing in April to assess economic conditions. The RBA’s board believe there is a strong case for further rate hikes to come amid concerns that the growing population and ongoing wages growth in the public sector are still not under control and in line with the slowdown in economic growth previous rate hikes have been targeting. CBA and some economists now expect the RBA to hike the nation’s cash rate by a further 25-basis points in May which will take the cash rate to 3.85%, while ANZ says the RBA could go either way. The local bourse responded negatively to the release of the RBA’s minutes yesterday, with the ASX closing the second trading session of the week down 0.29% led by a sharp sell-off in energy and consumer staples stocks. The energy sector was weighed down amid declining gas prices on the back of excess global LNG supply.
It was a big day for healthcare companies yesterday with some big news moving some key names in the sector. Drug development company Neuren Pharmaceuticals (ASX:NEU) jumped over 5% yesterday reaching a record high share price after announcing it has earned US$40m as an earnout payment from its US partner, Acadia Pharmaceuticals, for the first commercial sale of the company’s drug Trofinetide in the US. Telix Pharmaceuticals (ASX:TLX) led the market gains yesterday, soaring over 12% a day after the commercial-stage biopharmaceutical company released its quarterly cash-flow statement and accompanying activities report for the first quarter including revenue of $100.1m.
Overseas, China’s GDP growth rate data released yesterday came in at 4.5% growth year on year in the first quarter, which beat expectations of 4% growth and up from 2.9% growth in Q4 as the country ramps up operations after emerging from length COVID-19 lockdowns. Chinese retail sales also grew the most in nearly 2-years in March, increasing by 10.6% year-on-year as sales picked up especially for gold and silver jewellery.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open 0.12% higher to start the midweek session in the green.
- Taking a look at commodities this morning, oil is down 0.23% at US$80.65/barrel, gold is up almost half a percent at US$2004.24/ounce and iron ore is down 1.67% at US$118/tonne.
- AU$1.00 is buying, US$0.67, 90.13 Japanese Yen, 53.99 British Pence and NZ$1.08.
- There is no local economic data out today however over in the UK, the country’s inflation rate data for March will be released at 5pm AEST with consensus expecting a slight decline to 9.8% from 10.4% in February.
Trading Ideas:
- Bell Potter has downgraded its price target on Regis Resources (ASX:RRL) from $2.88 to $2.77 but maintain a buy rating on the company after the gold miner released preliminary group gold production for the March quarter 2023 of 103.7 thousand ounces which fell short of expectations and was down 11.6% quarter-on-quarter.
- Trading Central has identified a bullish signal on Cleanaway Waste Management (ASX:CWY) following the formation of a pattern over a period 32-days which is roughly the same amount of time the share price may rise from the close of $2.49 to the range of $2.61 to $2.65 according to standard principles of technical analysis.
US equities kicked off earnings week on a positive note, with all three major benchmarks making gains overnight, in fact, all three benchmarks closed 0.3% higher. US financials will be in focus this week with the Bank of America reporting tonight and Morgan Stanley reporting on Wednesday. Investors have been keeping a close eye on the banking sector after the collapse of Silicon Valley Bank last month.
European markets closed mixed. Germany’s Dax, France’s CAC and the STOXX 600 were all lower, while the FTSE 100 rose just 0.1% by the close.
What to watch today:
- The Australian market is set to open 0.23% lower this morning, according to the SPI futures.
- BHP’s (ASX:BHP) takeover of OZ Minerals (ASX:OZL) was approved yesterday and will be finalised in early May. In December last year, OZ Minerals announced that it had entered a Scheme Implementation Deed with BHP. The implementation date is May 2nd, when BHP will pay $26.50 per OZL share as the Scheme Consideration, and OZ Minerals will pay $1.75 per OZL share as a fully franked special dividend.
- In economic data, today the RBA’s meeting minutes will be released at 11:30am AEST, which will provide some insights into the meeting when the central bank decided to hold the cash rate steady for the first time in 10 months. And attention this week will be on China’s gross domestic product report on Tuesday and UK CPI numbers on Wednesday.
- In commodities,
- The oil price is trading over 2% lower, as concerns mounted that further rate hikes from the Fed will hurt growth even more. However, also note that GDP growth data for China that is due to be released tomorrow, which should offer some relief for a fall in oil demand.
- Gold is 0.4% lower as investors continue to assess the monetary policy outlook.
- Iron ore is trading flat.
- Auckland International Airport (ASX:AIA) and Hub24 (ASX:HUB) are set to release quarterly reports today, so keep watch of those share price movements today.
Trading Ideas:
- Bell Potter have initiated coverage on Brickworks (ASX:BKW) with a buy rating. BKW is a building materials and property developer. Bell Potter says that on face value, the company looks reasonably priced relative to listed peers, however, a high presence of equity accounting masks what is relatively low-cost exposure to a residential housing recovery, with BKW’s core Building Products business trading at an approximately 11% discount to the peer group. Bell Potter’s price target is $27.00. At the stock’s current share price of $23.56, this implies 14.6% share price growth in a year.
- Trading Central have identified a bullish signal on Core Lithium (ASX:CXO) indicating that the stock price may rise from the close of $0.93 to the range of $1.12 to $1.16 over 17 days, according to the standard principles of technical analysis.
Wall Street closed lower on Friday as investors assessed a mixed bag of economic data against big bank first quarter earnings results. Retail sales data for March was released in the US late last week showing a 1.2% decline for the month compared to expectations of a 0.4% drop. Despite this reading, unfavourable results from consumer sentiment and industrial production data add further support for the Fed to raise the nation’s cash rate by 25-basis points at the next FOMC meeting. The Dow Jones industrials index fell 0.42%, the S&P500 lost 0.21% and the tech-heavy Nasdaq fell 0.35%.
Big banks began releasing first quarter results on Friday with BlackRock (ASX:BKT) rising 3% after beating profit expectations, alongside Citigroup, and JPMorgan rallying on bumper earnings results that also beat expectations. Earnings reports being released by the banks enters full swing this week so we can expect the markets to move accordingly based on how well the big banks performed in the first quarter, especially in the wake of the regional banking crisis earlier this month.
Over in Europe, markets ended the final trading session of the week higher, led by a rise in the banking sector after JPMorgan Citigroup and Wells Fargo beat estimates for the first quarter and ahead of earnings season this week for the big banks. The STOXX600 rose 0.53%, Germany’s DAX rose half a percent, the French CAC added 0.52% and, in the UK, the FTSE100 rose 0.36%.
The local index closed 0.51% higher on Friday after a turbulent session on Thursday following the release of unemployment data showing the country’s unemployment rate remains ultra-low at 3.5%, in a sign for the RBA to continue its rate hike journey in May after April’s pause. Investor sentiment was lifted on Friday though by a rally for materials stocks amid a rise in commodity prices and demand outlook, while financials stocks were lifted by strong earnings results out of some big banks in the US.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.16% higher to start the new trading week on a positive note.
- On the commodities front this morning oil is trading 0.44% higher at US$82.52/barrel, gold is down 1.75% at US$2004/ounce and iron ore is flat at US$120/tonne.
- There is no local economic data released today however investors will be eagerly awaiting the release of the RBA’s meeting minutes for April out tomorrow to gain an insight into how the RBA are thinking about future rate hikes to tackle Australia’s current level of inflation.
- Stocks trading ex-dividend today include New Hope Corporation (ASX:NHC). If you’ve been thinking about this coal mining stock, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has downgraded its rating on Breaker Resources (ASX:BRB) from a buy to a sell and has downgraded the price target from $0.62 to $0.53 following the receipt of a takeover offer from Ramelius Resources that has been unanimously recommended by Breaker’s board and major shareholders to accept the offer. The takeover offer is worth $130.7m and implied a share price offer of $0.40/share at the time of the all-scrip takeover offer being received.
- Trading Central have identified a bullish signal on ARB Corporation (ASX:ARB) following the formation of a pattern over a period of 76-days which is roughly the same amount of time the share price may rise from the close of $32.61 to the range of $40.25 to $42.00 according to standard principles of technical analysis.
The Aussie share market advanced 1.46% (Mon-Thu), as investors shook off fears of a global banking crisis and digested key inflation data out of the US. Materials stocks led the charge this week with the sector rising 3.16%, buoyed by iron ore prices rising on the back of a cyclone forming off WA's Kimberley coast, a key region of iron ore export for Australia.
In this week's wrap, Grady covers:
• (0:25) Outlook for the lithium sector
• (4:17 ) Where Bell Potter sees opportunities in lithium
• (5:11) The best performing stocks in the ASX200
• (5:57) The most traded stocks & ETFs by Bell Direct clients
• (6:27) Two economic news items to watch out for
US equities had a strong run overnight, after the US producer price index for March was released, which was another economic report to point to the fact that US inflation may be cooling down. PPI dropped 0.5% month over month, compared to market expectations for prices to be flat. Excluding food and energy, the core wholesale prices reading declined, when the market was expecting an increase.
All three major benchmarks rallied. The Dow and the S&P500 both closed over 1% higher, with the S&P500 closing at its highest level since February. The Nasdaq closed 2% higher, boosted by the PPI report. So its good to see tech stocks among the gainers, after being hit the hardest during the periods of rising inflation and rates.
What to watch today:
- The SPI futures are suggesting that the Australian market will open 0.2% higher, following Wall Streets lead.
- In commodities,
- Oil prices are trading lower, easing from the five-month high hit earlier this week. Watch energy producers such as Beach Energy (ASX:BPT) and Woodside Energy (ASX:WDS)
- Gold moved higher overnight, trading at its highest level since March 2022. Gold miners such as Newcrest Mining (ASX:NCM) and St Barbara (ASX:SBM) could have a good finish to the week.
- And iron ore is also flat at US$121.50 per tonne.
Trading Ideas:
- Bell Potter maintain a Buy rating on Beach Energy (ASX:BPT) and have lowered their price target from $2.21 to $2.18. at BPT’s current share price of $1.52, this implies 43.4% share price growth in a year.
- And Trading Central have identified a bearish signal in Stanmore Resources (ASX:SMR) indicating that the stock price may fall from the close of $3.26 to the range of $2.40 to $2.55 over 34 days, according to the standard principles of technical analysis.
Annual US inflation fell for a ninth consecutive month in March to 5% or the lowest level since May 2021. Economists were expecting annual inflation to fall to 5.2% so the larger drop to 5% beat expectations. Core inflation, the Fed’s preferred measure of inflation as it removes the volatile food and energy prices, on the other hand inched up for the first time in 6-months to 5.6% for March from 5.5% in February. Investors were spooked into sell-off mode on Wednesday after some fed officials said a mild recession is likely this year before the economy recovers over the next 2-years. The Dow Jones fell 0.11%, the S&P500 lost 0.41% and the tech-heavy Nasdaq fell 0.85% on Wednesday.
Over in Europe, markets closed slightly higher as investors digested key inflation data out of the US, with markets already factoring in a 75% chance that the Fed will raise interest rates by a further 25-basis points in May. Germany’s DAX rose 0.31%, the French CAC added 0.09% and, in the UK, the FTSE100 rose 0.5% on Wednesday.
The local market closed 0.47% higher buoyed by a rally for technology and materials stocks, extending the local bourse’s rally into a second straight session.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.04% lower or flat on the second last trading session of the week as global recession fears enhance on the back of the comments made by Fed officials overnight.
- On the commodities front this morning oil is trading 2.12% higher at US$83.26/barrel, gold is up 0.53% at US$2013.70/ounce and iron ore is up 1.25% at US$121.50/tonne. Iron Ore prices have risen in recent days following the formation of a cyclone off the Kimberley coast in Western Australia, a key region for iron ore export in Australia.
- Stocks trading ex-dividend today include Best & Less (ASX:BST), Horizon Oil (ASX:HZN) and Duxton Water (ASX:D2O). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- On the economic calendar front today, there is no local data released however over in the US tonight, Producer Price Index data for March will be released with the market expecting a rise of 0.1% following a 0.1% drop in February.
Trading Ideas:
- Bell Potter has initiated coverage of LGI Limited (ASX:LGI) with a Hold recommendation and a 12-month price target of $2.56. Bell Potter is positive on the long-term prospects for the market leader in the biogas recovery and renewable energy space, but feels the company is well valued at its current range.
- Bell Potter has cut its price target on Whitehaven Coal (ASX:WHC) from $8.15 to $7.05 and maintain a hold rating on the leading Australia coal producer, after the company cut its FY23 production guidance. Whitehaven Coal cited predicted labour shortages, operational constraints at Maules Creek, and weather interruptions during March, as the reasons for the downgrade in guidance.
Wall Street ended mixed again on Tuesday as investors try to shrug off recession concerns ahead of the release of key inflation data out later this week. The Dow Jones rose 0.3%, the S&P500 finished muted and the tech-heavy Nasdaq fell 0.4% on Tuesday. Investors are anticipating the release of the March readings for consumer price index out Wednesday and producer price index out Thursday to gain an insight into how the Fed might proceed on its current rate-hike journey. Moderna shares fell more than 3% overnight after the biotech firm said it delaying its flu vaccine after the experimental vaccine did not meet the criteria for ‘early success’ in a late-stage trial.
In Europe, markets closed higher following the return to trade after the Easter long weekend with the mining giants leading the gains across the board. Germany’s DAX rose 0.4% on Tuesday, while the French CAC added 0.9% and, in the UK, the FTSE100 added 0.6%.
The local market closed 1.26% higher on the first trading session of the shortened week, led by a surge in materials and consumer discretionary stocks. The materials sector was boosted by strengthening commodity prices and demand outlook from China, while consumer discretionary stocks were possibly driven higher by consumer confidence lifting. Westpac consumer confidence rebounded 9.4% in April, to the highest level since June 2022, following the RBA announcing a pause in interest rate hikes last week. The largest gains in consumer confidence were for the outlook in property prices. NAB business confidence for March also improved in data out yesterday, with the reading coming in at minus 1 from minus 4 in February, but business conditions slightly dropped from 17 to 16 for the month, indicating business confidence has stabilised but remains below the average at -1 index point. Newcrest Mining (ASX:NCM) shares jumped over 5% on Tuesday after the Aussie gold miner announced it had received an upgraded takeover offer from US gold mining giant Newmont valuing the company at almost $30 billion, implying a share price of $32.87/share, or a 22% premium to NCM’s previous closing price. After assessing the revised proposal, Newcrest has agreed to grant Newmont the opportunity to conduct confirmatory due diligence to enable it to put forward a binding proposal. Evergreen Lithium debuted on the ASX yesterday, jumping 20% during its debut session in another sign the lithium era is far from over. The lithium explorer aims to mirror the success of neighbours Core Lithium (ASX:CXO) and Liontown Resources (ASX:LTR), through its flagship Bynoe, Fortune Lithium and Kenny Projects.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.34% higher to start the midweek session in the green.
- On the commodities front this morning crude oil is trading 2.4% higher at US$81.63/barrel, its highest level since late January, buoyed by prospects of higher Chinese demand and tighter global supplies. Gold is up 0.73% at US$2004.14/ounce and iron ore is up 0.42% at US$120/tonne.
- Taking a look at the Aussie dollar, AUD$1.00 is buying US$0.67, 88.97 Japanese Yen, 54.89 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has increased its price target on 4D Medical (ASX:4DX) from $0.96 to $1.05 and maintain a speculative buy rating on the company following the company announcing it has signed an inaugural contract in the US to deliver its XV LVAS scans to a US hospital client, in the first steps of commercialisation for the company’s lung scanning technology.
- Trading Central have identified a bullish signal on Beach Energy (ASX:BPT) following the formation of a pattern over a period of 37-days which is roughly the same amount of time the share price may rise from the close of $1.54 to the range of $1.73-$1.77 according to standard principles of technical analysis.
It was a mixed session on in New York ahead of key inflation data and quarterly bank reports out this week. Tech stocks struggled to make gains, with shares of Apple falling 1.6% and Alphabet falling 1.8%. The Nasdaq closed in the red, while the Dow and the S&P500 advanced.
What to watch today:
- To start the trading week after we return from the Easter long weekend, the Australian market is set to open 0.3% lower this morning.
- In commodities,
- Oil prices have taken a downward turn amid renewed concerns that a potential global recession would weaken demand, and this offset the bullish bets around tighter global supplies.
- The price of gold is also lower, retreating slightly from its one-year high, as the US dollar gained some ground after the US non-farm payrolls report pointed to a tight labour market. The report also supported bets for another interest rate hike form the Fed in May.
- Iron ore continues to fall, reaching the lowest in three months, due to weak demand at the beginning of China’s construction season.
- In economic data today, Westpac will release its data on consumer confidence for April, and NAB will release its data on business confidence for March.
Trading Ideas:
- Bell Potter have re-initiated coverage on Alicidion (ASX:ALC), an Australian healthcare informatics company. Bell Potter have a speculative buy rating on ALC and a valuation of $0.20 per share. At the current share price of $0.12, this implies 73.9% share price growth in a year.
- Trading Central have identified a bullish signal in Jumbo Interactive (ASX:JIN), indicating that the stock price may rise from the close of $13.43 to the range of $13.80 to $13.95 over 19 days, according to the standard principles of technical analysis.
Wall Street closed mixed overnight with the Dow closing 0.2% higher, while the S&P500 closed 0.3% lower and the tech-heavy Nasdaq fell more than 1%. The Nasdaq dropped for the third straight session as investors shifted away from growth stocks amid signs that the US economy is weakening. The losses also followed weak eco data, where the latest ADP private payrolls report showed slowing job growth in March.
European markets were also mixed, with the FTSE 100 the only index to close in positive territory. Germany’s Dax, France’s CAC and the Stoxx 600 were all lower. So it seems that investors uncertainly has resurfaced this week, over the global economy outlook.
What to watch today:
- The SPI futures are suggesting the Australian market will open just 0.1% lower this morning.
- Watch Santos (ASX:STO)’s share price today, as the oil and gas producer is set to hold its AGM.
- Brickworks (ASX:BKW) is set to go ex-dividend today.
- In commodities:
- Oil is trading slightly lower, after being on the rise this week off the back of OPEC’s production cut announcement.
- Gold is steady at its highest levels in a year, around US$2,020 an ounce, as weak US data fuelled expectations that the Fed may not need to tighten further in the coming months to prevent a recession.
- Iron ore is at its lowest level since mid-January as the concerns continue of the low demand at the start of China’s peak construction season.
- In economic data, Balance of Trade data for February will be out at 11:30am AEST. The last time this data was announced, Australia’s trade surplus declined to $11.69 billion in January, from a downwardly revised $12.99 billion in December, with exports rising less than imports.
Trading Idea:
- Bell Potter maintains a Buy rating on IPD Group (ASX:IPG), a leading distributor of electrical equipment and industrial digital technologies. They have increased their price target from $3.50 to $4.00. The broker says that IPD is set for two consecutive years of approximately 15% volume growth. Their EPS changes across FY23-25 estimates are +4-6% and they say the company has a large future runway of replacement demand as incentives behind the electrification of buildings infrastructure, transport and logistics sectors continue to evolve.
US equities closed lower overnight. The Dow Jones fell nearly 200 points as investors assessed what the spike in oil prices could mean for the global economy. The S&P500 closed 0.6% lower; both the Dow and S&P500 snapped a four-day win streak. The Nasdaq closed 0.5% in the red. Also prompting the market losses was the latest job openings report out in the US, which saw that the number of available positions in February dropped below 10 million for the first time in almost two years.
European stocks were marginally lower. The oil and gas sector declined following the announcement earlier this week by OPEC; they’re cutting output by over a million barrels of oil per day, starting from May. Investors are now focusing on demand trends and the impact of higher prices on the global economy.
Also overnight, we saw the British pound trade higher against the US dollar throughout the session and hit a 10-month high. This followed the Bank of England’s chief economist warning that “domestically-generated inflation remains a risk” and that the fall in US job openings suggests that the Fed’s aim of slowing the labour market is taking effect.
What to watch today:
- After global markets closed in negative territory overnight, the SPI futures are suggesting that our local market will fall 0.18% at the open this morning.
- A few stocks to watch today include Novonix (ASX:NVX) and Scentre Group (ASX:SCG) both holding their AGMs today. While stocks going ex-dividend today include ARB Corporation (ASX:ARB), Imdex (ASX:IMD) and Ridley Corporation (ASX:RIC). Remember this often sees share prices fall, as investors take their profits.
- In economic news, today the RBA Governor Phillip Lowe will give a speech, following yesterday’s cash rate decision, with the RBA holding the cash rate at 3.6% for the first time in 10 months.
- In commodities:
- Oil prices continue to rise, underpinned by the surprise production cut announcement by OPEC.
- The price of gold has reached its highest level since March 2022, after the US jobs opening data pointed to a slowdown in the labour market, which suggests that the Fed may not need to raise rates.
- Iron ore is currently trading almost 3% lower at US$123.50 per tonne, approaching a two-month low, amid underwhelming demand in the Chinese peak construction season, as well as signs of increased speculatory control. So, keep watch of iron ore stocks today.
Trading Idea:
- Bell Potter maintain a Speculative Buy rating on Chalice Mining (ASX:CHN), after the miner announced a major resources upgrade for the Gonneville deposit, at its 100% owned Julimar Nickel-Copper Platinum Group Elements (PGE) project, which is approximately 70km north of Perth. Bell Potter says that the “project represents a unique opportunity to establish a new, strategic, long-life, low-cost PGE and base metals supply in a top mining jurisdiction. It’s partly because of the inclusion of PGE’s nickel and cobalt on Australia’s and the USA’s critical minerals lists, due to their role in the lithium-ore battery and hydrogen fuel cell production value chain and Russia’s market dominance. The company’s latest update exceeded Bell Potter’s expectations and they have lifted their valuation by 8% to $12. At CHN’s current share price of $7.25, this implies 65.5% share price growth in a year.
In New York overnight, the Dow Jones closed 300 points higher or 0.98%, to begin April’s trading. The S&P500 saw its fourth straight day of gains, closing 0.37% in the green, while the Nasdaq closed 0.3% lower. US investors showed resilience despite an oil output cut from OPEC.
Oil prices notched their biggest gain in nearly a year after OPEC announced it was cutting output by more than 1 million barrels per day. The cuts begin in May and run until the end of this year. Saudi Arabia have said that it was a “precautionary measure” targeted toward stabilising the oil market. Oil is current trading 6.28% higher at US$80.42 per barrel. This announcement complicates the outlook for inflation and interest rates, as investors had been betting that easing price pressures would give central banks room to pause the current tightening cycle. So, energy shares will be on watch today; some include Beach Energy (ASX:BPT), Woodside Energy (ASX:WDS) and Santos (ASX:STO).
Also in commodities, natural gas has hit its lowest level since September 2020, pressured by weak demand due to high temperatures and ample inventories. The price of gold is steady, while iron ore has rebounded on expectations of strong demand as China enters the spring construction season.
What to watch today:
- The Australian market is set to open just 0.06% higher this morning, if you’re going by the SPI futures.
- In economic news, the RBA will announce its next cash rate decision. The Commonwealth Bank and Westpac have forecast the RBA will pause hiking the cash rate this month, and hold it at 3.6%, only to increase again in May, while NAB and ANZ predict a further 0.25% hike today.
Trading Ideas:
- Trading Central have identified a bullish signal in Link Administration (ASX:LNK) indicating that the stock price may rise from the close of $2.13 to the range of $2.51 to $2.59 over 44 days, according to the standard principles of technical analysis.
Wall Street extended gains into a third straight session on Friday and the US market posted a second straight quarter of gains despite turbulence during the three-month period around the unfolding of a potential global banking crisis. On Friday the Nasdaq rose 1.7%, the Dow Jones added over 400 points and the S&P500 rose 1.4%. Sentiment in the US was boosted last week by US core personal consumption expenditures price index, the Fed’s preferred measure of inflation, coming in below expectations at 4.6% in yet another sign inflation has peaked in the US. For the quarter the tech-heavy Nasdaq soared 17.6% as investors regain appetite for growth stocks, while the Dow Jones rose 0.4% and the S&P500 added 7.4%.
Over in Europe markets closed higher again buoyed by headline inflation cooling to 6.9% in March from 8.5% in February, a preliminary report showed. Germany’s DAX added 0.7%, the French CAC added 0.81% and, in the UK, the FTSE100 rose 0.15%. For the quarter, the STOXX600 added 7.05% despite a few weeks of banking turmoil.
The ASX ended Friday’s session up 0.78% driven by a 1.88% rise in materials stocks, while healthcare stocks added 1.09% in the last trading session of the week. For the week, the key local index rose 3.20% as global fears of a banking crisis continued to ease.
What to watch today:
- The strength overseas for the last quarter drives the SPI futures to anticipate the ASX to open 0.63% higher to start the new trading week and month.
- On the commodities front oil is trading 6.77% higher at US$80.87/barrel after OPEC oil producers announced a surprise cut in oil output to support market stability following the recent dive in oil prices. Saudi Arabia is cutting its output by 500,000 barrels per day while Iraq is cutting by 211,000 barrels per day, among other countries making cuts to output. Gold is trading down 0.73% at US$1965.73/ounce and iron ore is up almost 0.8% at US$127/tonne.
- The Aussie dollar is buying US$0.67, 88.93 Japanese Yen, 54.89 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has downgraded its rating on The A2 Milk Company (ASX:A2M) from a buy to a hold, and reduced the price target on the dairy company from $7.65 to $6.80 following the company’s infant formula producer, Synlait Milk (ASX:SM1), downgrading its earnings guidance and pushing out its expected GB registration in China. Bell Potter sees the balance dates between A2M and SM1 don’t align, as well as cost of goods sold being expected to rise in FY24.
- Trading Central has identified a bearish signal on TPG Telecom (ASX:TPG) on the 25th of March, following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may fall from the close of $4.81 to the range of $4.47 to $4.55 according to standard principles of technical analysis.
The Aussie share market advanced 2.4% (Mon-Thu), driven by the materials sector jumping 5.04%, amid increasing commodity prices. Utilities and energy stocks also jumped over 3% each. The ASX200 felt some relief this week, after a few weeks of turbulence, as investor fears of a global banking crisis eased when regulators and industry bodies stepped in to support crumbling banks.
In this week's wrap, Grady covers:
- (3:10) The outlook for oil prices
- (3:30) Stocks Bell Potter are bullish on
- (4:24) The best performing stocks in the ASX200
- (5:57) The most traded stocks & ETFs by Bell Direct clients
- (6:35) Four economic news items to watch out for
The rally on Wall Street continued overnight as investor fears of a regional and global banking crisis continued to ease as President Biden urged federal regulators to take up a set of reforms to safeguard the banking system.
Weekly jobless claims in the US increased by 7000 to 19,800, in yet another sign the Federal Reserve’s aggressive interest rate action to tackle inflation in the US is starting to take effect. The rise in jobless claims is also another sign the fed could begin easing its rate hike stance. The Dow Jones closed 0.43% higher on Thursday while the S&P500 added 0.57% and the tech-heavy Nasdaq rose 0.73%.
Over in Europe, markets continued to rally as investor fears of a banking crisis also continued to ease in the region. UBS shares jumped 3.4% again on Thursday as investors responded to the news of Sergio Ermotti retaking his position as CEO ahead of the Credit Suisse takeover. Germany’s DAX added 1.26%, the French CAC added 1.06% and, in the UK, the FTSE100 rose 0.74%.
Locally yesterday, the ASX jumped 1.02% joining the global rally as banking crisis fears ease, with technology stocks leading the gains yesterday as the sector closed up 1.7%. Materials and Financial stocks also felt some relief yesterday following a week of turbulence in these respective sectors.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the local market to open 0.53% higher, extending on the global rally from the past 2-sessions.
- Taking a look at commodities, crude oil is trading almost 2% higher at US$74.37/barrel, gold is up 0.81% at US$1979.94/ounce and iron ore is also up 0.8% at US$125.50/tonne.
- Stocks trading ex-dividend today include Harvey Norman (ASX:HVN), and Russell Investments High Dividend Australian Shares ETF (ASX:RDV). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- The Aussie dollar is buying US$0.67, 89.05 Japanese Yen, 54.89 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has downgraded its price target on Synlait Milk (ASX:SM1) from $3.20 to $2.55 but maintain a buy rating on the company as the dairy company faces a few unknowns in the current environment including whether it can deliver acceptable returns on the new Pokeno nutritionals customer, as well as successfully navigating A2 Milk’s new-GB registration in China. The company also faces higher costs of production due to the volume uplift for the new Pokeno customer.
- Trading Central has identified a bullish signal on Regis Resources (ASX:RRL) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $2.00 to the range of $2.17 to $2.21 according to standard principles of technical analysis.
Wall Street rebounded to rally on Wednesday as investor fears of a global banking crisis continue easing, boosting high growth stocks in the technology sector. Micron led the charge on the Nasdaq after the memory chip company forecast a drop in third quarter revenue in line with Wall Street expectations but gave a positive outlook for 2025 with artificial intelligence predicted to boost sales. The Dow Jones closed the midweek session 1% higher while the S&P500 also rose 1% and the tech-heavy Nasdaq added 1.5%. While the banking system stresses are far from over, analysts at the Bank of America said ‘banking system stresses remain high but there are some signs of stabilisation’.
Over in Europe markets also rebounded to close higher across the board. Investor fears of large bank collapses in the region are easing, especially after UBS announced former Chief Executive Sergio Ermotti will return as Chief Executive to guide the takeover of Credit Suisse, coming in to replace Ralph Hamers. The return of Ermotti sent shares in UBS up 3.72% on Wednesday. Germany’s DAX added 1.23% on Wednesday, while the French CAC rose 1.39% and, in the UK, the FTSE100 rose 1.07%.
Australia’s consumer price index data for February out yesterday showed the country’s inflation rate rose 6.8% in the year to February 2023, which is the second consecutive month of disinflation from the peak inflation rate of 8.4% in December 2022, and is an eight-month low for the inflation indicator. The most significant contributors to the annual increase seen in February were Housing up 9.9%, food and non-alcoholic beverages up 8%, transport up 5.6% and recreation and culture up 6.4%. Inflation falling to 6.8% in February from 7.4% in January provides further evidence that consumer prices have peaked, especially ahead of the RBA’s interest rate meeting next week. Consensus were expecting a rise of 7.1%, so inflation coming in lower than expectations supports the notion for a pause in rate hikes at the RBA’s meeting next week.
The local index rose 0.23% yesterday as investor sentiment was boosted by the slowing of inflation growth in the country. The materials and energy sectors topped the gains on the local index yesterday with each adding over 1.2% on the back of rising commodity prices and boosted global demand outlook for key commodities.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open 0.68% higher on the back of that global rally overnight.
- On the commodities front this morning, oil is trading 0.31% lower at US$72.97/barrel, gold is down almost half a per cent at US$1964/ounce and iron ore is up 1.63% at US$124.50/tonne.
- The Aussie dollar is buying US$0.67, 88.79 Japanese Yen, 54.89 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has increased it’s price target on Liontown Resources (ASX:LTR) from $2.81 to $3.35 and maintain a speculative buy rating on the lithium producer following the company announcing it has received and rejected a takeover offer worth $5.5bn from the world’s largest lithium producer, Albermarle. The corporate interest in Liontown Resources from a high-profile US-based industry participant speaks to the quality of Liontown’s Kathleen Valley project.
- Trading Central has identified a bullish signal on Piedmont Lithium (ASX:PLL) following the formation of a pattern over a period of 27-days which is roughly the same amount of time the share price may rise from the close of $0.82 to the range of $1.05 to $1.11 according to standard principles of technical analysis.
A number of Australian economists are now expecting a 25-basis point rate hike in April following the release of Australian retail sales data for February indicating a rise of 0.2% for the month or 6.4% from February 2022, on the back of a 1.8% rise in January. The retail data shows consumers are still spending despite the increasing cost of living pressures down under, with $35.14bn spent last month. Department stores had the biggest increase in monthly turnover, while household goods retailing remained flat which isn’t great news for the likes of Temple & Webster (ASX:TPW) and Nick Scali (ASX:NCK). UBS though, is adamant the RBA won’t hike rates at next week’s meeting but will instead hike by 25-basis points in May. Australia’s consumer price index or inflation data is out today for February which will give a greater insight into how successful the RBA’s monetary tightening policy has been to date and will give the RBA a better idea of whether a pause or hike is most appropriate at next week’s interest rate meeting.
Locally yesterday, the ASX rallied 1.04% led by a surge in energy stocks, with the sector jumping over 4%. Lithium mining and production companies felt some much-needed relief yesterday following a recent sell-off amid declining demand outlook. The reason for yesterday’s boost in lithium stocks was due to lithium giant Liontown Resources (ASX:LTR) announcing it had received and rejected a takeover offer from Abermale, the world’s largest lithium producer, in a deal worth $5.5bn on the grounds of the offer substantially undervaluing Liontown and its assets. The announcement sent shares in Liontown soaring 68.5%.
Over in New York, Wall St had a mixed session on Tuesday as rising bond yields placed pressure on high-growth technology stocks. The yield on the 2-year U.S. Treasury note climbed back above 4%, which makes future profits for growth companies, less attractive as higher rates mean that earnings years from now are worth less today. The Dow Jones ended Tuesday’s session down 0.12% while the S&P500 lost 0.16% and the tech-heavy Nasdaq took the biggest hit ending the session down almost half a percent.
In Europe overnight, investor concerns over the unfolding banking crisis in the region led to a muted trading day across the key markets in Europe. Germany’s DAX closed up just 0.09%, the French CAC added 0.14% and, in the UK, the FTSE100 rose just 0.17%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the local market will open 0.37% lower to start the midweek trading session.
- On the commodities front, oil has advanced 1.10% to trade at US$73.6/barrel amid supply concerns held after a legal dispute halted around 400,000 barrels a day of oil exports from the Ceyhan Port in Turkey this week. Gold is up 0.84% at US$1973/ounce and iron ore is flat at US$122.50/tonne.
- The Aussie dollar is buying US$0.67, 87.58 Japanese Yen, 54 British Pence and NZ$1.07.
Trading Ideas:
- Bell Potter has downgraded its rating on United Malt Group (ASX:UMG) from a buy to a hold and have significantly increased the price target on the company from $4.25 to $5.00 following the company announcing it has entered into a process and exclusivity deed with Malteries Soufflet for the takeover of UMG in a deal worth $1.5bn. Bell Potter sees the takeover offer and subsequent share price rise by 30% after the announcement well exceeds Bell Potter’s passive valuation for UMG and therefore justifies the downgrade to a hold from a buy rating.
- Trading Central has identified a bullish signal on AMP Limited (ASX:AMP) following the formation of a pattern over a period of 27-days which is roughly the same amount of time the share price may rise from the close of $1.06 to the range of $1.17 to $1.19 according to standard principles of technical analysis.
Wall Street ended Friday’s session on a positive note as investors responded to the Fed’s interest rate hike of 0.25% and signals that the Fed is near the end of its monetary tightening cycle. The positive sentiment boost from the Fed was a much-needed relief following a week of turbulence in the global banking sector. The Dow Jones rose 0.41%, the S&P500 added 0.56% and the tech heavy Nasdaq jumped 0.3%.
Over in Europe, it was a different story with markets in the region ending lower on Friday as investor fears of a global banking crisis worsened. Deutsche Bank fell 8.5% on Friday after its credit default swaps, a form of insurance for bond holders, pushed higher. Germany’s DAX fell 1.66%, the French CAC lost 1.74%, and in the UK, the FTSE100 fell 1.26%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.04% lower to start the new trading week.
- Locally, the ASX ended almost 0.2% lower on Friday, weighed down by a sharp sell-off in financials stocks, and for the week the key index lost 0.57%. Block Inc (ASX:SQ2) was the worst performing stock on the local bourse in the final trading session of the week on claims made by famed short-seller Hindenburg Research, that the company is committing widespread fraud.
- On the commodities front to start the week, oil is trading lower again, down 1% at US$69.26/barrel, gold is down 0.75% at US$1978.57/ounce and iron ore is up 0.41% at US$122.50/tonne.
- The Aussie dollar is buying US$0.67, 86.85 Japanese Yen, 54.89 British Pence and NZ$1.07.
- Stocks trading ex-dividend today include Australian Clinical Labs (ASX:ACL), and Lycopodium (ASX:LYL). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- There is no local economic data released today however investors will be eagerly awaiting the release of preliminary Australian retail sales data for February, which is out tomorrow, with consensus expecting a rise of 0.5% from a 1.9% jump in January.
Trading Ideas:
- Bell Potter has increased its price target on Aeris Resources (ASX:AIS) from $0.92 to $0.95 and maintains a buy rating on the company following the copper production and exploration company discovering a new massive sulphide lens at the Bentley deposit at the company’s 100%-owned Jaguar Operations in WA.
- Trading Central has identified a bullish signal on Lifestyle Communities (ASX:LIC) following the formation of a pattern over a period of 35-days which is roughly the same amount of time the share price may rise from the close of $15.03 to the range of $20 to $21 according to standard principles of technical analysis.
The Aussie share market declined 0.37% (Mon-Thu), following the recent US banking system turmoil. Additionally, the Federal Reserve increased the Fed Funds Rate by 0.25% to 4.75% - 5%, announcing a continued commitment to quantitative tightening.
In this week's wrap, Sophia covers:
- (0:39) Fed projections for the Fed Funds Rate (FFR)
- (1:33) The growing banking crisis
- (2:22) The sale of Credit Suisse to UBS
- (3:14) The best performing stocks in the ASX200
- (4:42) The most traded stocks & ETFs by Bell Direct clients
- (5:21) Two economic news items to watch out for
Following a volatile trading session overnight, US equities closed higher, as investors bet that the Federal Reserve may be nearing the end of its rate hiking cycle. The Dow and the S&P500 rose 0.2% and 0.3% respectively, while the Nasdaq closed just over 1% higher, as tech stocks outperformed.
European markets were lower as the Bank of England joined the Fed in hiking rates. The UK central bank announced another 25-basis point rise and the Stoxx 600 closed down 0.2%. The banking sector led losses throughout the session. Construction and oil and gas stocks also declined, while tech stocks rallied in Europe as well.
What to watch today:
- The broad tech rally made way to renewed selling in regional banking stocks, which sees the SPI futures suggesting the Australian market will drop 0.55% at the open this morning.
- Technology stocks may follow the Nasdaq’s rally, with investors reducing their bets on the Fed’s next hike, and as US Treasury yields decline. Tech stocks are sensitive to interest rates, so this saw tech hit the hardest as the Fed consecutively raised rates. Therefore, the turn lower in rates this month is causing investors to rotate back into tech stocks. And this may have a positive impact on ASX-listed tech shares today.
- In commodities:
- Oil has dropped once again, weighed down by weak global sentiment.
- The price of gold is trading over 1.2% higher and has reached its highest level in one year, at US$1,993.90 per ounce, as investors continued to digest the Fed’s March meeting and risks to the global banking system.
- Iron ore has tumbled, currently trading 2.8% lower at US$123.50 per tonne, the lowest level in over a month. The iron ore price has been pressured by weaker demand from steel producers and increased control of speculatory prices. There have also been reports indicating that China will cut its domestic steel output by 2.5% this year. That would mark the third consecutive annual decline and of course China is one of the top producers.
Trading Ideas:
- Bell Potter have upgraded their recommendation on Eagers Automotive (ASX:APE) from a Hold to a Buy, with a price target of $15.25, where the total expected return is over 15%. A potential catalyst to support the upgrade on the leading automotive retailer, are increased sales of BYD vehicles over the coming months, following the joint venture of Eagers Automotive and BYD, which is an electric car dealership.
- And Trading Central have identified a bullish signal on PWR Holdings (ASX:PWH) indicating that the stock price by rise from the close of $9.65 to the range of $12.20 to $12.70 over 27 days, according to the standard principles of technical analysis.
The Federal Reserve has announced a further 25 basis point rate hike, and although this was widely expected, the US stock market declined with all three major benchmarks closing around 1.6% lower. The Fed also acknowledged turmoil in the banking sector could slow the already fragile economy, which share US bank shares slide.
What to watch today:
- The SPI futures are suggesting that our local market will drop 0.74% at the open this morning, following Wall Street’s lead.
- In commodities:
- The oil price continues to regain last week’s losses, after data out from the US Energy Information Administration showed a surprise build in US crude stocks and large draws in other fuels like gasoline. Also, the US oil benchmark is 5% higher this week, as the Treasury Secretary Janet Yellen said the government would be willing to take further action to protect deposits. Watch ASX energy shares today.
- The price of gold over 1.5% higher and is heading toward a one-year high, as investors weighed on the Fed’s dovish tone in its policy decision. This may see gold miners rise, such as Regis Resources (ASX:RRL), Newcrest Mining (ASX:NCM), Northern Star Resources (ASX:NST) or Evolution Mining (ASX:EVN).
- Iron ore has dropped more than 1%, extending the retreat from the nine-month high hit last week, amid increased control of speculatory prices and curbs for major steel producers.
- Watch the share price movements of Brickworks (ASX:BKW) which is set to release an earnings report today.
Trading Ideas:
- Bell Potter maintains a Buy rating on EROAD (ASX:ERD) with modest downgrades to their forecasts post the company’s guidance u[date provided late last month and their investor day held this week. Bell Potter have decreased their price target, down 32% to $1.50, after updating each valuation used in the determination of their price target for the forecast changes, as well as market movements and time creep. The $1.50 target is still an over 100% premium to the current share price of $0.64.
- Trading Central have identified a bullish signal in AGL Energy (ASX:AGL), indicating that the stock price may rise from the close of $7.07 to the range of $7.30 to $7.36 over 22 days, according to the standard principles of technical analysis.
Wall St rallied again on Tuesday as investor optimism about the banking crisis recovering lifted stocks in the US, with shares of banks leading the charge on the second trading session this week. Investors also responded to the efforts of the US and Europe to stabilise the global banking system. The Dow Jones rose just under 1%, the S&P500 added 1.3% and the tech-heavy Nasdaq rose 1.6% on Tuesday.
Investors now shift focused to the all-important FOMC meeting in the US this
week where it is anticipated the Fed will announce a 25-basis point rate hike at the conclusion of the meeting on Thursday morning Australian time.
Overnight in Europe, markets closed higher as investor fears of a global banking crisis settled following UBS’ takeover of rival bank Credit Suisse. Germany’s DAX rose 1.75%, the French CAC added 1.42% and, in the UK, the FTSE100 added 1.8%.
On the local index yesterday, the RBA’s latest meeting minutes being released hinted that a rate pause is being considered for April which fuelled a rally on the local bourse. The ASX closed 0.82% higher on Tuesday buoyed by optimism from the release of the RBA’s minutes and on the back of the global rally that started the week on a positive note.
It has been a big week on the M&A front – Ramelius Resources (ASX:RMS) lobbed a takeover offer at Breaker Resources (ASX:BRB), and Australian Clinical Labs (ASX:ACL) launched a takeover offer at Healius (ASX:HLS), with the deal creating the nation’s largest pathology services provider, should it go ahead. And just yesterday Andrew Forrest’s Wyloo Metals made a $760m takeover offer for nickel producer Mincor Resources (ASX:MCR), sending shares in Mincor rocketing 42% during the session, as Forrest looks to expand his presence in the battery metal space.
What to watch today:
- Ahead of the local trading session the ASX is poised to open 0.9% higher on the back of the global rally overnight.
- On the commodities front this morning crude oil has recovered some ground from its tumble over the last week to trade 2.7% higher this morning at US$69.66/barrel, gold is down almost 2% at US$1940/ounce and iron ore is down 2.65% at US$128.50/tonne.
- The Aussie dollar is buying 67 US cents, 88.26 Japanese Yen, 54.89 British Pence and 1 New Zealand dollar and 8 cents.
- Stocks trading ex-dividend today include Myer (ASX:MYR), Seek (ASX:SEK) and Supply Network (ASX:SNL). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bearish signal on DDH1 (ASX:DDH) following the formation of a pattern over a period of 90 days which is roughly the same amount of time the share price may fall from the close of $0.82 to the range of $0.65 to $0.69 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Metcash Limited (ASX:MTS) following the formation of a pattern over a period of 450 days which is roughly the same amount of time the share price may fall from the close of $3.79 to the range of $2.50 to $2.80 according to standard principles of technical analysis.
The ASX tumbled to a four-month low yesterday, ending the session down 1.4%, in the wake of the global banking crisis taking a new turn with global investment bank UBS agreeing to takeover troubled Swiss lender Credit Suisse. Investors are also eyeing off the all-important FOMC meeting in the US where it is expected the Federal Reserve will announce a 25-basis point rate hike at the conclusion of the meeting on Thursday morning Australian time. Locally, the energy sector was again the worst performing sector to start the week as commodity prices continue to plummet as the prospect of slower economic growth due to a banking crisis induces investor fears of a recession and weakened demand outlook for commodities. Despite the unravelling of weakness in the global banking system, Australian banks hold some of the strongest positions in capitalisation and liquidity management globally due to tight governance from the regulatory body, APRA. This tight scrutiny has proved successful in maintaining strength for Australian banks during key events including the GFC and pandemic.
A welcome relief rally started the week on a positive note for US investors as Wall St closed higher across the key indices on Monday. Investor sentiment was boosted by hopes that the global banking crisis may be easing after UBS agreed to take over troubled lender Credit Suisse. The Dow Jones closed up 1.2%, the S&P500 rose 0.9% and the Nasdaq added 0.4%. We may see sentiment shift later this week though after the Fed hands down its interest rate decision for the month ahead.
Over in Europe, markets rallied to start the new week, also boosted by UBS’ takeover of Credit Suisse, with UBS chairman Colm Kelleher saying the acquisition is ‘attractive’ for UBS shareholders. Germany’s DAX rose 1.12%, the French CAC added 1.27% and, in the UK, the FTSE100 rose almost 1% to start the week.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.65% higher on the back of the global rally overnight.
- On the commodities front oil has rebounded this morning to trade 1.35% higher at US$67.64/barrel, gold is down 0.64% at US$1975/ounce and iron ore is flat at US$132/tonne.
- Looking at the Aussie dollar, AU$1.00 is buying US$0.67, 88.18 Japanese Yen, 54.89 British Pence, and NZ$1.08.
- Stocks trading ex-dividend today include Latitude Group (ASX:LFS), Reece (ASX:REH), Cochlear (ASX:COH), Credit Corp Group (ASX:CCP) and Brisbane Broncos (ASX:BBL). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on AGL Energy (ASX:AGL) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $7.11 to the range of $7.24 to $7.30 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Viva Energy Group (ASX:VEA) following the formation of a pattern over a period of 28-days which is roughly the same amount of time the share price may fall from the close of $2.79 to the range of $2.48 to $2.54 according to standard principles of technical analysis.
The global banking crisis took an historical turn this morning with investment bank, UBS, agreeing to buy Credit Suisse Group in a deal worth $4.5 billion to restore investor confidence in the global banking sector. The crisis worsened on Friday after a fourth bank, the First Republic bank, received a US$30 billion lifeline from a group of big banks including Goldman Sachs and Bank of America, after customers began withdrawing their deposits from First Republic bank amid the collapse of SVB. Shares in First Republic Bank tumbled 33% on Friday to close the week down 72%. On Friday, the Dow Jones closed 1.2% lower, the S&P500 fell 1.1% and the Nasdaq closed down 0.74%. For the week though the Nasdaq rose 4.41% as investors bet on technology and growth stocks ahead of the FOMC meeting this week.
Over in Europe, markets closed lower on Friday as investors digest the fallout from Credit Suisse accepting financial help to stabilise the banking system. Germany’s DAX fell 1.33% on Friday while the French CAC lost 1.43% and in the UK the FTSE100 shed just over 1%.
In Australia, markets closed 0.42% higher on Friday but 2.1% down for the week as the local index was caught up in the global banking crisis driven sell-off.
What to watch today:
- In commodities, oil Is trading 2.36% lower at US$66.74/barrel, gold is up almost 3.6% at US$1988.08 and iron ore is flat at US$132/tonne.
- The Aussie dollar has slightly strengthened to buy US$0.67, 88.53 Japanese Yen, 54.89 British Pence and NZ$1.07.
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 1.4% lower as investor sentiment continues to ride on the unfolding global banking crisis.
- Stocks trading ex-dividend today include HUB24 (ASX:HUB), Adairs (ASX:ADH), and Duratec (ASX:DUR). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has downgraded its price target on Synlait Milk (ASX:SM1) from $4 to $3.20 but maintain a buy rating on the company. The downgrade in price target comes after the company downwardly revised FY23 NPAT expectations relative to market expectations ahead of its 1H23 result. NPAT guidance has been downwardly projected to now be $15-$25m NZ dollars, which is much lower than Bell Potter’s expectations of a forecasted NZ$35.8m and consensus expectations of NZ$50m. Major drivers of the change in NPAT forecast from the company have been attributed to order deferrals from major IMF customers, inflationary cost pressures, lower milk production and higher working capital costs.
- Trading Central has identified a bearish signal on Ansell (ASX:ANN), following the formation of a pattern over a period of 40-days which is roughly the same amount of time the share price may fall from the close of $26.14 to the range of $20.90 to $21.80 according to standard principles of technical analysis.
The Aussie share market declined 2.5% (Mon-Thu), led by a 7.2% dive in energy stocks on the back of tumbling commodity prices. The price of oil was down nearly 12% this week, driven by turmoil in the global banking sector. On the flip side Healthcare stocks provided great opportunity for investors, adding 0.74% this week so far.
In this week's wrap, Grady covers:
- (0:38) The Silicon Valley Bank collapse
- (1:30) The US$10 billion in deposits withdrawn from Signature Bank
- (2:22) Credit Suisse's liquidity issues
- (4:48) The best performing stocks in the ASX200
- (5:46) The most traded stocks & ETFs by Bell Direct clients
- (6:21) Two economic news items to watch out for
Global markets advanced after Credit Suisse announced that it’ll borrow up to nearly $54 billion from the Swiss National Bank to assure short-term liquidity. Despite concerns weighing on the banking sector, all three US indexes closed in the green, on pace to end the week higher. The Nasdaq was up the most, rallying 2.5%.
Investors also followed the announcement of a further rate hike of 50-basis points from the European Central Bank.
What to watch today:
- Following the rebound overnight, our local market is set to open 0.39% higher, according to the SPI futures.
- In commodities, oil has slightly rebounded, following a heavy drop. Oil hit an over one-year low of around US$66 in the prior session. Gold is trading flat, at a strong six-week high, as the risk-off mood continues, while iron ore is on a steady rise, current at its highest level in nine months.
- While there’s no local economic data out today, tonight we’ll be watching out for the CPI announcement in Europe.
Trading Ideas:
- Bell Potter maintains a Buy rating on Telix Pharmaceuticals (ASX:TLX) with a price target of $9.00. At TLX’s current share price of $6.86, this implies 31.2% share price growth in a year.
- Bell Potter have also downgraded their recommendation on Appen (ASX:APX) from a Hold to a Sell, based on valuation, as well as a lack of visibility due to the relatively low level of recurring revenue and uncertainty over customer spend. Bell Potter says the risk to their downgrade is any developments announced when the results of a strategic review are released in May, however they see no quick fix to the lack of visibility. Their price target of $2.25 is now a 13% discount to the share price of $2.60.
The local market rallied 0.86% yesterday as investors regained confidence was restored by a rally on Wall Street on Tuesday. Information technology stocks led the local rally yesterday, while energy stocks were sold off amid a decline in commodity prices. The best performing stocks on the local index yesterday were led by Pexa Group (ASX:PXA) jumping over 6.4%, Link Administration Holdings (ASX:LNK) rallying almost 6% and Coronado Global Resources (ASX:CRN) lifting 5.44%. On the losing end of the market, Imugene (ASX:IMU) fell 4%, Evolution Mining (ASX:EVN) shed 3.2% and Lovisa (ASX:LOV) lost 3.05%.
Wall Street took a dive on Wednesday amid further turbulence in the banking sector as leading bank Credit Suisse said earlier this week that it has found “certain material weakness in our internal control over financial reporting for 2021 and 2022”. The concerns out of Credit Suisse prompted the Swiss regulator to say it would give the country’s central bank Credit Suisse liquidity if necessary. Credit Suisse shares closed the midweek session down over 24%. Stocks recovered some ground in afternoon trade but the Dow Jones ended the day down 0.87%, and the S&P500 lost 0.7% but the tech-heavy Nasdaq actually rose 0.05% on Wednesday. US retail sales data out overnight also showed retail spend dropped 0.4% in February as consumers pulled back in spending amid rising interest rates and higher cost of living pressures. Consumers spent less on restaurants and department stores and more on staples goods retail. The Credit Suisse saga is the latest in the global financial sector turmoil following two U.S. banks collapsing earlier this week.
Over in Europe, markets had their worst session since Russia initiated war with Ukraine back in February 2022, as investors responded to the concerns out of banking giant Credit Suisse. The bank dropped to the bottom of the blue-chip index after its biggest lender, the Saudi National bank said it would not be able to offer it more financial help. The STOXX600 closed over 3% lower, Germany’s DAX fell 3.27%, the French CAC lost 3.58%, and in the UK, the FTSE100 tumbled 3.83%.
What to watch today:
- On the commodities front crude oil has tumbled over 4% overnight to trade at US$68.43/barrel amid the turmoil across the global banking sector. Gold is trading 0.81% higher at US$1917/ounce and iron ore is up 0.4% at US$133.50/tonne.
- The Aussie dollar is buying US$0.66, 88.20 Japanese yen, 55.03 British pence and NZ$1.07.
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 1.68% lower on the back of the global turbulence overnight.
- Stocks going ex-dividend today include IGO (ASX:IGO), Data#3 Limited (ASX:DTL), Regis Healthcare (ASX:REG), and Embelton (ASX:EMB). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on DGL Group (ASX:DGL) following the formation of a pattern over a period of 10-days which is roughly the same amount of time the share price may rise from the close of $1.83 to the range of $2.12 to $2.18 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on SRG Global (ASX:SRG) following the formation of a pattern over a period of 30-days which is roughly the same amount of time the share price may fall from the close of $0.71 to the range of $0.64 to $0.66 according to standard principles of technical analysis.
The local index dipped 1.41% amid the fallout from the SVB and Signature collapses in the US sending shockwaves throughout global markets. Investors fear the collapses are sign of what’s to come in the financial sector, which has caused a sell-off in financial stocks and sparked investors to pile into safe-haven assets like gold. The winning stocks yesterday on the ASX were unsurprisingly led by gold miners including Ramelius Resources (ASX:RMS) adding 5.8%, Perseus Mining (ASX:PRU) jumping 4.43% and Silver Lake Resources (ASX:SLR) adding 3.77%. On the losing end of the market, the stocks that weighed the key index down were led by Lake Resources (ASX:LKE) tumbling 8.5%, Novonix (ASX:NVX) falling 8.46% and BrainChip Holdings (ASX:BRN) losing 8%.
Investors repositioned out of tech stocks and into defensive stocks yesterday, which can be taken as a sign of fears around what’s to come as interest rates continue rising and the cost of funding growth for companies in the technology sector becomes increasingly unaffordable. Investors are also fearful that the collapse of the banks will not play part in the Fed’s interest rate decision next week, with many anticipating a 25-basis point rate hike, while some analysts are even expecting a 50-basis point rate hike to be announced. Consumer and business confidence for March and February respectively were released yesterday, with confidence sliding for both consumers and businesses in the respective months as interest rates continue rising and place increased financial pressure on consumers and businesses alike. Regulators find themselves in a difficult position in the U.S. They need to raise interest rates to curb inflation however, raising interest rates exacerbates the issue facing U.S. banks. US annual inflation data was released overnight for the month of February and came in at 6%, the lowest level since September 2021 and down from 6.4% in January, in a sign the Federal Reserve’s aggressive rate hike stance is taking effect.
Wall Street responded positively to the data with the market breaking the recent red streak to close in the green. The Dow Jones rose 1.06%, the S&P500 added 1.68% and the Nasdaq rose 2.14%.
Over in Europe, markets also closed higher in response to the release of US inflation data. Investors in the region also bought back into the banking sector following days of selling out in response to the SVB collapse. Germany’s DAX rose 1.83, the French CAC added 1.86% and, in the UK, the FTSE100 rose 1.17%.
What to watch today:
- On the commodities front, oil is trading 3.11% lower at US$72.48/barrel, gold is down 0.33% at US$1907/ounce and iron ore is up almost 2% at US$133/tonne.
- The Aussie Dollar is buying US$0.67, 89.58 Japanese Yen, 54.84 British Pence and NZ$1.07.
- Ahead of the local session here in Australia the SPI futures are anticipating the ASX to open almost 1% higher on the back of the global rally overnight.
Trading Ideas:
- Bell Potter has increased the rating on Neuren Pharmaceuticals (ASX:NEU) from a Hold to a speculative BUY and has sharply increased the price target from $8.60 to $13.67 following the US FDA approving Neuren’s US Partner, Acadia Pharmaceuticals drug Trofinetide for the treatment of Rett syndrome in adult and paediatrics two year of age and older.
- Bell Potter has maintained its hold rating on Infomedia (ASX:IFM) but has increased its price target from $1.35 to $1.45 amid improving outlook for the leading software solutions provider in the automotive industry. The increase in price target is driven by an expected return to double digit cash EBITDA growth in FY24 and FY25 as well as cost control and margin expansion improving the company’s financial performance.
The risks and aftermath of the collapse of Silicon Valley Bank really echoed through markets, with shares ending mostly lower globally. Despite governments taking action to maintain confidence in the banking system, we saw global markets under pressure overnight. The news has also provoked question of whether the Federal Reserve will deliver a larger rate hike of 50-basis points this month.
On Wall Street, financials lagged, as stocks in several regional US banks declined. The Dow dropped for the fifth straight day, the S&P500 was also lower, while the Nasdaq gained. And Treasury yields tumbled, helping to lend some support to equities.
What to watch today:
- Extending these losses, the Australian market is set to drop 1.86% at the open this morning, and that’s according to the SPI futures.
- In this current market, where are the opportunities? Investors are seeking safety in gold amid the turmoil in the banking sector. The gold price saw a sharp rebound, after hitting its lowest level in over a month, jumping 2.4% higher and it continues to be on the rise. We also know that gold is sensitive to the rates outlook – and the collapse of Silicon Valley Bank has not only divided markets on what the Fed will do with its rate-rising cycle but we’re also awaiting US inflation data out this week. So, keep in mind that higher interest rates lift the opportunity cost of holding non-yielding bullion and vice versa. Bell Potter is bullish on gold at the moment, with buy ratings on Capricorn Metals (ASX:CMM), Regis Resources (ASX:RRL) and Gold Road Resources (ASX:GOR).
- Looking at other commodities, the oil price has fallen 2.6% amid the broad risk-off day across markets. And iron ore is in the green, approaching an eight month high as investors continue to assess the outlook for Chinese commodities this year.
- Watch out for Lake Resources (ASX:LKE) today, as the company is set to release its earnings report.
- News Corporation (ASX:NWS) and Coronado Global Resources (ASX:CRN) are set to go ex-dividend, which may see their share prices fall, as investors take their profits.
Trading Ideas:
- Bell Potter have a speculative buy rating on Cluey (ASX:CLU), following the educational technology company’s H1 result and $10.6 million capital raise. Their 12-month valuation has been lowered to $0.50, and at CLU’s current share price of $0.17, this implies 191.5% share price growth in a year.
- Trading Central have identified a bearish signal in Suncorp (ASX:SUN) indicating that the stock price may fall from the close of $12.36 to the range of $11.90 to $12 over 25 days, according to the standard principles of technical analysis.
The local market tumbled over 2% on Friday as investors were spooked by comments made and reiterated over a few days by Federal Reserve Chair Jerome Powell that interest rates will need to stay higher for longer, prompting further fears of a global recession. The utilities sector was the only sector to escape the broad market sell-off on Friday. The winning stocks were led by Origin Energy (ASX:ORG) adding 2.45%, while TPG Telecom (ASX:TPG) and Silver Lake Resources (ASX:SLR) each also added over 2%. On the losing end of the market it was a lithium sell-off led by Allkem (ASX:AKE) tumbling 8.6%, while Sayona Mining (ASX:SYA) and Liontown Resources (ASX:LTR) each fell 8%.
Wall Street closed sharply lower on Friday as the collapse of tech-focused lender Silicon Valley Bank sent shockwaves through the banking sector. The collapse resulted from losses in the bank’s bond portfolio and is the biggest bank failure since the global financial crisis. The Dow Jones fell 1.07%, the S&P500 lost 1.45% and the tech-heavy Nasdaq fell 1.76% on Friday. It was the worst week since June 2022 for the Dow Jones on Wall St last week, with the major indices capped off the week with losses. The Dow fell 4.44%, the S&P dropped 4.55%, and the Nasdaq lost 4.71%.
Over in Europe, markets closed lower on Friday, also led by a sell-off in the banking sector after early news of a capital raise at Silicon Valley Bank leading to the stock collapsing 60%, wiping out over $80bn in value from the bank’s shares.
Germany’s DAX fell 1.31%, the French CAC lost 1.3% and, in the UK, the FTSE100 shed 1.67%.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open down 0.55% following the global sell-off that ended last week on a sour note.
- On the commodities front this morning, crude oil is up 1.27% at US$76.68/barrel, gold is up just under 2% at US$1867/ounce and iron ore is up 1.16% at US$130.50/tonne.
- The Aussie dollar is buying US$0.66, 88.93 Japanese yen, 54.58 British pence and NZ$1.08.
- Stocks trading ex-dividend today include Dusk Group (ASX:DSK), Chorus (ASX:CNU), and Joyce Corporation (ASX:JYC). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has upgraded its rating on Platinum Asset Management (ASX:PTM) from a Sell to a Hold but has decreased its price target from $1.68 to $1.66 after the Bell Potter team met with the company and also following the release of the company’s funds under management figures for February showing $18.5bn in FUM, being $153m lower than January, indicating outflows of 0.7%. The increase in Rating to a hold follows management being upbeat about the prospects for the company including strong distribution and position in the market, and higher costs in recent reports being attributed to high bonus payments to staff.
- Bell Potter has downgraded its price target on Lumos Diagnostics (ASX:LDX) from 10 cps to 6cps but maintain a speculative buy rating on the company following the signing of three service agreements with the potential to provide up to $2.5m in revenue. The price target downgrade is on the back of a reduction in Bell Potter expectations for revenue forecasts for products sold as the new CEO Doug Ward increases focus on the services arm of the company.
The Aussie share market advanced 0.38% (Mon-Thu), shaking off some of the negative offshore macro-economic events. Meanwhile, investors fled energy and materials stocks, as these sectors fell with commodity prices, partly due to a weaker than usual demand out of China.
In this week’s wrap, Grady covers:
- (1:08) Global macro themes impacting investments
- (2:34) The Fed’s monetary tightening impact on commodities
- (3:24) Why investors are fleeing small & mid-cap resources stocks
- (4:21) The best performing stocks in the ASX200
- (5:18) The most traded stocks & ETFs by Bell Direct clients
- (5:51) Four economic news items to watch out for
The ASX rose just 0.05% yesterday as a rally for technology stocks offset sharp losses for healthcare, materials and real estate stocks. The winning stocks yesterday were led by Xero (ASX:XRO) charging 10.66% after the cloud-based software company announced it is cutting up to 800 of its staff to manage costs. New Hope Corporation (ASX:NHC) and Whitehaven Coal (ASX:WHC) each added over 5.5% amid the rising price of coal. On the losing end, Imugene (ASX:IMU), and Breville Group (ASX:BRG) each fell over 3% and BrainChip Holdings (ASX:BRN) lost almost 3%.
Wall Street has just closed for Thursday’s session with the market responding negatively to Federal Reserve chair Jerome Powell reiterated his comments about the need for the U.S. central bank to keep interest rates higher for longer, on the second day of his testimony to congress. The Federal Reserve chair said that signs of a hotter economy from the start of the year warrant faster rate hikes, prompting investors to believe a 50-basis point rate hike could be lock in for the next month. Next week’s US CPI print remains in focus for investors to gauge if the 50-basis point rate hike could become a reality. The Dow Jones fell 1.66%, the S&P500 fell 1.8% and the Nasdaq lost 2.05%. Powell also say he hasn’t made up his mind about what the central bank will do with regards to rates when it meets later in March.
In Europe, markets closed mostly lower after Federal Reserve chair Jerome Powell reiterated his comments. Germany’s DAX closed just 0.1% higher while the French CAC fell 0.12% and, in the UK, the FTSE100 fell 0.63%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open 1.11% lower on the back of the Wall St sell-off overnight.
- Taking a look commodities oil is trading 1.27% lower at US$75.69/barrel, gold is up 0.88% at US$1829.50/ounce and iron ore is down again by 0.4% at US$128.50/tonne.
- The Aussie dollar is buying US$0.66, 89.68 Japanese Yen, 55.55 British Pence and NZ$1.08.
- Stocks trading ex-dividend today include Downer EDI (ASX:DOW), WiseTech Global (ASX:WTC), Base Resources (ASX:BSE), and Grange Resources (ASX:GRR). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Novonix (ASX:NVX) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may rise from the close of $1.60 to the range of $1.74 to $1.78 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Hotel Property Investments (ASX:HPI) following the formation of a pattern over a period of 47-days which is roughly the same amount of time the share price may fall from the close of $3.46 to the range of $3.27 to $3.31 according to standard principles of technical analysis.
The local market closed in the red yesterday, making the RBA-rate announcement rally very short lived as investor sentiment was dampened by Fed Chair Jerome Powell saying interest rates need to go higher for longer in order to tackle the stubbornly high inflation in the US. Energy stocks were the worst performers yesterday amid a dive in commodity prices. Nanosonics (ASX:NAN) outperformed the market yesterday, rising over 7.5% despite no price sensitive news out of the company yesterday, while Ramelius Resources (ASX:RMS) weighed on the market, tumbling almost 11% amid the declining price of gold yesterday.
In Europe markets closed mixed as investors continued digesting the remarks made by fed chair Jerome Powell. The STOXX600 closed 0.12% higher, Germany’s DAX added almost half a percent, the French CAC lost 0.2% and, in the UK, the FTSE100 rose 0.13%.
Wall Street has just closed, and it was a turbulent session in the US overnight following the release of stronger-than-expected JOLTs and ADP jobs data, in a sign the labour market remains tight in the US, adding yet another reason for the Fed to continue its monetary tightening policy for longer. The number of job openings in the US fell by 410,000 to 10.824 million in January, above market expectations of a decline to 10.5 million. The Dow Jones fell 0.18%, the S&P500 lost 0.14% but the Nasdaq rose 0.4%.
What to watch today:
- Ahead of the local session the SPI futures are anticipating the ASX to open 0.45% higher despite the turbulent session on Wall St overnight.
- Commodities have been a driver of materials stocks being sold off locally this week, but today we’ve seen a slight rebound in some key commodities. This morning, oil is still trading lower by around 1.6% at US$76.34/barrel, gold is up 0.1% at US$1815/ounce and iron ore is up almost 2% at US$129/tonne.
- The Aussie dollar is buying US$0.66, 90.50 Japanese Yen, 55.55 British Pence and NZ$1.08.
- Stocks going ex-dividend today include Mineral Resources (ASX:MIN), Monadelphous Group (ASX;MND), IDP Education (ASX:IEL), Perpetual (ASX:PPT), BHP Group (ASX:BHP), Rio Tinto (ASX:RIO) and CSL Limited (ASX:CSL). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has upgraded the price target on Avita Medical (ASX:AVH) from $4.20 to $5.60 and maintain a buy rating on the company following the company announcing a major upscaling of its US sales force and ahead of FDA label expansion approval due in June for trauma and vitiligo. Bell Potter sees the company has a strong balance sheet and a solid revenue base in the existing burns business, to fund expansion and upscaling in the US.
- Trading Central has identified a bullish signal on Nanosonics (ASX:NAN) following the formation of a pattern over a period of 34-days which is roughly the same amount of time the share price may rise from the close of $4.87 to the range of $5.70 to $5.90 according to standard principles of technical analysis.
The ASX rallied 0.5% yesterday following the rate hike announcement as investor sentiment was boosted by hopes that the RBA is approaching the end of its tightening cycle. Every sector aside from materials stocks closed in the green yesterday. The winning stock yesterday by a mile was InvoCare (ASX:IVC) rocketing over 34% after the funeral company received a takeover offer from TPG Global at the value of $12.65 cash per share. TPG snapped up a 17.8% stake in InvoCare on Monday before making the takeover offer worth $1.8 billion.
Overnight in Europe, markets closed lower as investors digested comments made by Fed chair Jerome Powell at his congressional testimony, where he warned interest rates are likely to be higher than central bank policymakers previously expected. Germany’s DAX fell 0.6%, the French CAC lost 0.46% and, in the UK, the FTSE100 closed 0.13% lower.
Over in the US, local US investors also responded to Powell’s comments around rates needing to go higher for longer. The Dow Jones fell 1.72%, the S&P500 lost 1.53% and tech-heavy Nasdaq closed the day down 1.25%.
Software giant Atlassian has announced it will lay-off 500 full-time staff in a cost-cutting measure, just 6-months after co-founder Scott Farquhar went on a hiring-spree. Meta, the parent company of Facebook and Instagram, also announced a fresh round of lay-offs to come yesterday in order to meet financial targets.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open almost 1% lower on the back of the turbulent session on Wall St overnight.
- On the commodities front, oil is trading more than 3% lower at US$77.935/barrel, gold is down 1.54% at US$1818/ounce and iron ore is down almost 2% at US$126.50/tonne.
- Stocks going ex-dividend today include Costa Group (ASX:CGC), Woodside Energy Group (ASX:WDS), Brambles (ASX:BXB), Super Retail Group (ASX:SUL), and Blackmores (ASX:BKL). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- The Aussie dollar is buying US$0.66, 90.29 Japanese Yen, 56.19 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded its rating on Eagers Automotive (ASX:APE) from a Buy to a HOLD but has increased its price target to $15.25 from $15. The price target increase is driven by sales of Chinese electric vehicle company BYD being greater than anticipated, however the downgrade to a hold is based on uncertainty around what, if any, extra provisioning must be taken around Scott’s going into administration and a potential easing in demand due to higher interest rates.
- Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $6.72 to the range of $7.25 to $7.40 according to standard principles of technical analysis.
In New York overnight, equities gained in the final hour of trading, as Treasury yields rose. US markets started the week on a positive note, ahead of a busy week of economic news. Important catalysts with week include congressional testimony on Tuesday and Wednesday from Federal Reserve Chair Jerome Powell, who will speak about how the central bank is thinking about inflation and rate hikes going forward. Also, the US awaits their February jobs report out this week as well.
European markets were flat after modest early-session gains, with mining stocks down the most.
China has announced a growth target of 5% this year. It’s viewed as a modest target, with Citi analysts announcing it is “disappointing to some investors” and falls short of their expectation. The 5% target is also below last year’s target of around 5.5%, when the country had its zero-covid policy. This saw the Aussie dollar drift lower.
What to watch today:
- The SPI futures are suggesting the Australian market will drop 0.26% at the open this morning.
- The key economic announcement is watch out for today is the RBA’s interest rate decision, so this could see our dollar rise again, as its widely expected the RBA will deliver its 10th straight interest rate hike. The announcement will be at 2:30pm AEDT today, when the cash rate is expected to rise to 3.6%.
- In commodities,
- Oil is rallying, extending gains for the fifth session as a weaker US dollar boosted the appeal of greenback-priced commodities, and offsetting concerns about China’s demand and economic growth targets. So, keep watch of energy producers.
- Gold is lower ahead of the US Fed chief testimony, and iron ore is trading flat.
Trading Ideas:
- Bell Potter maintain a HOLD rating on PWR Holdings (ASX:PWH), a leading provider of customised cooling solutions to the global motorsports and automotive industry. Bell Potter reviewed their forecasts after the release of the company’s H1 results last month, and have made some modest changes, including increasing FY24 and FY25 revenue forecasts and reducing NPAT forecasts. They have decreased their price target by 2% to $10.75 for the earnings changes, as well as market movements and time creep.
- Bell Potter have upgraded their recommendation on Arafura Rare Earths (ASX:ARU) from a Hold to a Speculative BUY. Their valuation remains unchanged at $0.72, which at ARU’s current share price of $0.55, implies 32% share price growth in a year.
The ASX rose 0.4% in the final trading session of last week, buoyed by a rally for communications services and healthcare stocks, while the REIT sector was the only sector to close in the red on Friday. For the week though, the key index posted a 0.32% loss, its fourth straight weekly loss, as sharp losses for REIT and Financial stocks offset strong gains in the energy and materials sectors.
The winning stocks from Friday’s session were led by Liontown Resources (ASX:LTR) jumping over 13% following a broker note out of Bell Potter, where analyst Stuart Howe believes the lithium miner’s shares could have much further to run. Ramelius Resources (ASX:RMS) also rose 5.6% on Friday and Netwealth Group (ASX:NWL) rallied 4.95% to end the week. On the losing end, Capricorn Metals (ASX:CMM) fell 4%, Silver Lake Resources (ASX:SLR) lost 3.74% and Centuria Capital Group (ASX:CNI) fell 3.7%.
The most traded stocks by Bell Direct clients on Friday were Liontown Resources (ASX:LTR), Fortescue Metals Group (ASX:FMG) and Mineral Resources (ASX:MIN).
Over in the US, stocks rallied on Friday following a retreat in the Treasury yields from recent highs, and comments from Atlanta’s Federal Reserve President backing a ‘slow and steady’ rate hike approach, boosted investor sentiment. The Dow Jones rose 1.17%, the S&P500 added 1.61% and the tech-heavy Nasdaq rose almost 2% on Friday. The yield on 10-year Treasury notes rose to 4.091% on Friday while the two-year US Treasury yield fell 0.4 basis points to 4.885%.
Over in Europe, markets closed higher in the region following a positive global trend on Friday. Germany’s DAX rose 1.64%, the French CAC added 0.88%, and in the UK the FTSE100 rose just 0.04%.
It’s a big week on the economic calendar this week as the RBA announces the latest rate hike decision for Australia on Tuesday, and later in the week we will gain an insight into how the US labour market is faring with nonfarm payrolls, unemployment and JOLTs jobs data all released in the US.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open 0.87% higher to start the week on a positive note.
- Stocks going ex-dividend today include QBE Insurance (ASX:QBE), Nick Scali (ASX:NCK), Sims (ASX:SGM), REA Group (ASX:REA), Iluke Resources (ASX:ILU), Helloworld Travel (ASX:HLO), Bendigo and Adelaide Bank (ASX:BEN), Insurance Australia Group (ASX:IAG) and more. If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
- Taking a look at commodities this morning, oil is trading almost 2% higher at US$79.68/barrel, gold is up 1.05% at US$1855.25/ounce and iron ore is flat at US$129/tonne.
- The Aussie Dollar is buying US$0.67, 91.75 Japanese Yen, 56.24 British Pence and NZ$1.09.
Trading Ideas:
- Bell Potter has increased its price target on Capricorn Metals (ASX:CMM) to $4.67 from $4.35 and has increased its rating to buy from hold on the company on the grounds of buying in at the dip ahead of catalysts. Bell Potter sees recent share price depreciation provides an opportunity to buy into the stock as the company’s management team has an excellent track record of delivering to plan, the gold miner is a sector leader, AISC are among the lowest in the sector, and the company has consistently strong cash generation per ounce produced.
- Trading Central has identified a bullish signal on Champion Iron (ASX:CIA) following the formation of a pattern over a period of 274-days which is roughly the same amount of time the share price may rise from the close of $7.95 to the range of $11.20 to $12.00/share, according to standard principles of technical analysis.
The Aussie share market declined 0.71% (Mon-Thu), with energy and materials stocks the only two sectors to close in positive territory. This week, rising commodity prices were boosted by favourable manufacturing data in China, as the country's economy reopens post-pandemic.
In this week's wrap, Grady covers:
- (1:29) The sectors thriving in tough market conditions
- (3:14) What to expect from the RBA next week
- (4:35) The best performing stocks in the ASX200
- (5:33) The most traded stocks & ETFs by Bell Direct clients
- (6:20) Four economic news items to watch out for
Equities closed higher in New York, as traders ignored concerns over higher interest rates. The Dow gained more than 400 points or 1.25%, boosted by Salesforce shares rallying 11%, on a strong quarter and forward guidance. The S&P500 trading 0.5% higher, while the Nasdaq was down earlier in the session, however also closed up 0.5%.
Rates moved higher, with the 10-year note yield trading above 4% and the 2-year note yield reaching levels not seen in over a decade.
European markets closed in the green, recovering from earlier losses, after the eurozone inflation data came in above expectations. Headline inflation fell to 8.5% in February, from 8.6% the previous month.
What to watch today:
- The SPI futures are this morning suggesting that Australian market will open 0.31% higher.
- We may see miners Rio Tinto (ASX:RIO) and BHP Group (ASX:BHP) end the week on a positive note, after their shares on the NYSE pushed higher in late trade overnight. Yesterday, ASX-listed BHP saw its biggest one-day gain in almost 4-months, amid evidence of China’s reopening economy.
- In commodities,
- Oil prices have jumped, as the market weighs hopes for a rebound in Chinese demand, against concerns about further policy tightening from the Fed. So, keep your eye on energy producers today such as Woodside Energy (ASX:WDS) and Beach Energy (ASX:BPT).
- Gold has remained steady for three days, amid the prospect of further monetary tightening.
- Iron ore is strong, currently trading 1.6% higher with investors optimistic about higher Chinese demand after since the country’s reopening.
- Stocks that are set to go ex-dividend today are Ampol (ASX:ALD), Nine Entertainment (ASX:NEC) and Treasury Wine Estates (ASX:TWE). Remember, this may see share prices fall, as investors take their profits.
Trading Ideas:
- Bell Potter maintain a Buy rating on Mincor resources (ASX:MCR), although the company’s H1 2023 results were below Bell’s forecasts. They have reduced their price target by 9% to $1.70, and at MCR’s current share price of $1.27, this implies 34% share price growth in a year.
- Trading Central have identified a bearish signal in Macquarie Group (ASX:MQG), indicating that the stock price may fall from the close of $184.86 to the range of $174 to $176 over 30 days, according to the standard principles of technical analysis.
Rising bond yields fuelled the sell-off on Wall Street overnight with the benchmark 10-year yield topping 4% for the first time since November, while the 1-year Treasury yield climbed above 5%. Investors also reassessed the outlook for tightening monetary policy and economic growth as key data has been released around the world showing inflation continues to remain stubbornly high in Europe and other key regions. The Dow Jones closed up 0.02%, while the S&P500 fell 0.47% and the Nasdaq fell 0.66%. Salesforce shares soared 13% on Wednesday after the cloud software company posted better-than-expected fourth quarter and full year results including Q4 revenue up 14% to US$8.38bn, while full year revenue rose 22%. The company’s strong results were attributed to cost cutting measures including laying off staff during the quarter as it pushes to become more profitable.
Over in Europe economic data continues to weigh on investor sentiment in the region with local markets there closing mostly lower on Wednesday following the release of a flash estimate into Germany’s harmonised inflation rate showing an increase from 9.2% to 9.3% in February. This comes ahead of Eurozone inflation due out on Tuesday. Germany’s DAX fell 0.39%, the French CAC lost almost half a percent, and in the UK the FTSE100 rose almost half a perfect on Wednesday.
Global markets may face some relief today though buoyed by China releasing its official purchasing managers’ index data for February overnight showing a rise to 52.6 points in February, the highest since April 2012, in a sign the world’s second largest economy is beginning to ramp up manufacturing and overall operations following the removal of its harsh COVID restrictions.
What to watch today:
- In commodities, oil is trading 0.66% higher at US$77.55/barrel, gold is up 0.56% at US$1837/ounce and iron ore is flat at US$126/tonne.
- The Aussie dollar is buying US$0.68, 92.01 Japanese Yen, 56.07 British Pence and NZ$1.08.
- The local market slipped into the red yesterday after Australian GDP data for Q4 was released, showing the economy grew 0.5% over the quarter, which is a slower pace than was expected. This is the fifth straight quarter of growth in the economy but the softest pace in the period amid intense cost-of-living pressures and rising interest rates.
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open flat on the second last trading session of the week.
- Stocks trading ex-dividend today include Baby Bunting (ASX:BUB), Woolworths (ASX:WOW), Propel Funeral Partners (ASX:PFP), Coles Group (ASX:COL), Pro Medicus (ASX:PME), Medibank Private (ASX:MPL), Pilbara Minerals (ASX:PLS) and Jumbo Interactive (ASX:JIN). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Deep Yellow (ASX:DYL) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may rise from the close of $0.68 to the range of $0.90 to $0.96 according to standard principles of technical analysis.
- Bell Potter has downgraded its price target on Bubs Australia (ASX:BUB) to 29cps but maintains a hold rating on this company following the release of the infant formula company’s first half results that focused on costs eating into margins. For the half, Bub’s reported revenue down 6%, an underlying EBITDA loss of $22m, elevated inventory position of $8.4m and expect higher operating cost assumptions between FY23-25.
Wall Street had a choppy final session for the month of February before closing lower on Tuesday as investors digested a slew of economic data and corporate earnings results. Chicago’s PMI fell to 43.6 points for February from 44.3 points in January in another sign the US Fed’s aggressive rate hike stance is having impact across the country. The Dow Jones ended Tuesday’s session down 0.71%, the S&P500 lost 0.1% and the Nasdaq fell 0.3%. The yield on the 10-year US Treasury note ticked higher to 3.94% on Tuesday, its highest level since November. Target shares are up over 1.7% on Tuesday after the retail giant released fourth-quarter earnings results that exceeded expectations, while Zoom video Communications is also up over 1.2% after posting a top and bottom line beat for the fourth quarter.
In Europe overnight, hotter-than-expected inflation data out of Spain and France for February caused a sell-off in the region as the data is the latest sign that inflationary pressures are still running high, adding to concerns that the European Central Bank must continue raising rates to get inflation under control. The STOXX600 fell 0.2%, Germany’s DAX fell 0.11%, the French CAC fell 0.38% and, in the UK, the FTSE100 fell 0.74%.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the local market to open 0.26% lower.
- In commodities, oil is heading for its fourth straight monthly decline amid stockpiles of the commodity in the US and slower-than-expected demand increase from China post the country reopening. Today, oil is up 1.4% at US$76.76/barrel, gold is up 0.52% at US$1826/ounce and iron ore is down 2.70% at US$126/tonne.
- The highly anticipated Australian GDP growth rate for Q4 is released today which will give an insight into how well the RBA’s attempts have been so far at cooling the stubbornly high inflation down under. The consensus expectation is for a rise of 0.8% following a 0.6% increase in Q3.
- The Aussie dollar is buying US$0.67, 91.68 Japanese Yen, 56.22 British Pence, and NZ$1.09.
- Stocks trading ex-dividend today include Humm Group (ASX:HUM), AMP (ASX:AMP), The Lottery Corporation (ASX:TLC) and Telstra Group (ASX:TLS). If you’ve been thinking about these stocks it might be worth buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Resolute Mining (ASX:RSG) following the formation of a pattern over a period of 18-days which is roughly the same amount of time the share price may rise from the close of $0.24 to the range of $0.31 to $0.33 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Westpac Banking Group (ASX:WBC) following the formation of a pattern over a period of 99-days which is roughly the same amount of time the share price may fall from the close of $22.53 to the range of $20.50 to $20.90 according to standard principles of technical analysis.
US equities closed in the green overnight, trying to recover some ground after the Wall Street had its worst week of the year. The Dow gained 0.2%, the S&P500 up 0.3% and the Nasdaq rose 0.6%. These moves came as Treasury yields eased, following a jump on Friday. We’re seeing a renewed focus on inflation and again seeing rates driving equities. Investors are also looking ahead to another week in retail earnings.
European equities were also higher, with all major benchmarks in positive territory. And the European Central Bank has stated that it’ll be hiking rates by another 50 basis points in March, so investors are preparing for that announcement this month.
What to watch today:
- The Australian market is looking to start the day higher. The SPI futures are suggesting a rise of 0.47% at the open.
- Reporting season is wrapping up today with the final list of companies set to release their earnings reports today. Some of these companies include DGL Group (ASX:DGL), Mach7 Technologies (ASX:M7T) and Tyro Payments (ASX:TYR). So, with one day to go, this reporting season we’ve seen 268 companies report their earnings. 80 of these beat expectations, 107 were in line with expectations, and 81 companies missed expectations. It’s also been a busy month for brokers – we saw a total of 50 rating upgrades and 38 rating downgrades.
- Keep watch of the stock going ex-dividend today, as this often sees their share prices fall as investors take their profits. These include Amcor (ASX:AMC), Accent Group (ASX:AX1), Bega Cheese (ASX:BGA), Domino’s Pizza (ASX:DMP), Evolution Mining (ASX:EVN), Origin Energy (ASX:ORG) and Worley (ASX:WOR).
- In commodities, oil is down, as lingering concerns about a recession-driven demand downturn offset prospects of tighter global supplies. Gold is higher, however still hovering at its weakest level in two months, and iron ore has dropped more than 1.5%, so watch iron ore stocks today.
Trading Ideas:
- Bell Potter have a Hold rating on Appen (ASX:APX) and have lowered their price target from $3 to $2.25. The company’s 2022 revenue fell 3% to US$388.5 million, which was slightly below Bell Potter’s forecast of US$393.8 million. Underlying EBITDA fell 39%, but was in line with Bell’s forecast.
- Bell Potter also maintains their Buy rating on Accent Group (ASX:AX1), after the company beat expectations for H1 and H2 trading has commenced on strong note. AX1 reported EBIT of $81 million, NPAT of $50.7 million and dividends per share of 12cps.
The local market ended Friday’s session 0.3% higher as a surge in tech stocks led the markets higher, while every sector aside from materials stocks also finished the day in the green.
The winning stocks from Friday’s session were led by Bega Cheese (ASX:BGA) adding over 7.5% on the back of the company’s first half results being released, while Brambles (ASX:BXB) and Block Inc (ASX:SQ2) each also added over 7.4 and 5.8% respectively. On the losing end, Regis Resources (ASX:RRL) fell almost 5% after releasing first half results and providing a mineral resource update on its Tropicana project.
The most traded stocks by Bell Direct clients on Friday were AGL Energy (ASX:AGL), Pilbara Minerals (ASX:PLS) and Core Lithium (ASX:CXO).
For the week, the key index posted a 0.54% loss despite the Utilities sector gaining over 6% buoyed by Origin Energy jumped over 15% on the back of receiving a revised takeover offer for $8.90/share.
Over in the US, Wall St closed lower on Friday as, yet another inflation-related report came in stronger than expected. Personal Consumption Expenditure price index, the Fed’s preferred measure of inflation in the US, jumped to 4.7% in January which well exceeded expectations of a rise to 4.3%. The Dow Jones fell 1%, the S&P500 also lost 1% and the tech-heavy Nasdaq slid 1.7%, to wrap up Wall St’s worst week in 2023.
Over in Europe on Friday, markets also closed lower in the region as investors assessed the latest corporate earnings results in addition to economic data out of the US. Germany’s DAX fell 1.72%, the French CAC lost 1.78% and in the UK the FTSE 100 fell 0.37%.
What to watch today:
- This week Q4 GDP growth rate in Australia out on Wednesday with consensus expecting a growth rate of 0.9%, up from 0.6% growth in Q3. If the figure comes in at 0.9% it will make it the fifth straight quarter of growth in the economy, and a higher rise than Q3 which may cause a market sell-off on Wednesday.
- Preliminary Australian retail sales data for January is released in just over an hour with consensus expecting a rise of 1.2%, following a 3.9% decline in December.
- Over in the US, several Federal Reserve officials will speak this week, giving clues into the size of the next interest rate hike so investors locally and globally will be keeping an eye out for these speeches, and we may see markets move accordingly post these speeches.
- On the commodities front, oil is trading 1.23% higher at US$76.23/barrel, gold is down 0.64% at US$1810.90/ounce and iron ore is trading 1.13% lower at US$131.50/tonne.
- The Aussie dollar is buying US$0.67, 91.81 Japanese yen, 56.04 British pence and NZ$1.09.
- Ahead of the local trading session the SPI futures are anticipating the ASX to open sharply lower amid the global sell-off that ended the last trading week on a sour note.
Trading Ideas:
- Trading Central has identified a bullish signal on Lake Resources (ASX:LKE) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $0.61 to the range of $0.87 to $0.93 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Sandfire Resources (ASX:SFR) following the formation of a pattern over a period of 73-days which is roughly the same amount of time the share price may fall from the close of $6.22 to the range of $4.00 to $4.40 according to standard principles of technical analysis.
The Aussie share market declined 0.84% (Mon-Thu), as investors reacted to the latest company earnings announcements. This reporting season so far, we've seen 192 companies report, 62 beat expectations, 71 came in-line with expectations, while 59 companies fell short of expectations.
In this week's wrap, Grady covers:
- (0:50) Why your weekly food shop has increased in price
- (2:03) The shift from coal to green operations by the big miners
- (3:44) Qantas' turns a profit, but raises CAPEX
- (4:32) The best performing stocks in the ASX200
- (5:59) The most traded stocks & ETFs by Bell Direct clients
- (6:30) One economic news item to watch out for
Overnight in the US, equities advanced higher in a late-day rally, with all three major benchmarks in positive territory. European stocks also moved higher in response to the Federal Reserve’s meeting minutes, which showed that they’re still committed to fighting inflation with interest rate hikes. Equities were in the green, with the STOXX 600, Germany’s DAX and France’s CAC all closing in the green, while the FTSE 100 ended the session lower.
What to watch today:
- The Australian market is set to open slightly higher this morning, with the SPI futures suggesting a rise of 0.06%.
- In commodities:
- Oil prices are rallying, currently trading around US$75.56 per barrel, ending two days of losses, amid lingering concerns about tight global supplies. Russia has announced its plans to cut oil exports from its western ports by up to 25% in March, exceeding its announced output curbs of 500,00 barrels per day. The market is also expecting China’s oil imports to hit a record high this year, amid rising demand for transportation fuel and as new refineries come online.
- US natural gas is trading 8% higher, however remained not far from a 29-month low, as the market monitors demand and weather forecasts, with recent projections pointing to cold-than-expected temperatures.
- Iron ore is trading at its strongest level in 8-months, with signs of stronger demand for Chinese construction, grouped with supply concerns.
- Gold has held its recent decline, at its lowest in 8-weeks, after the Fed’s meeting minutes shoed that policymakers will continue interest rate hikes.
- Companies reporting today include Allkem (ASX:AKE), Aristocrat Leisure (ASX:ALL), BWX (ASX:BWX), Brambles (ASX:BXB), Harvey Norman Holdings (ASX:HVN), Link Administration Holdings (ASX:LNK)and Mineral Resources (ASX:MIN).
Trading Ideas:
- Bell Potter maintain a BUY rating on Eagers Automotive (ASX:APE) after the company reported its earnings. 2022 revenue fell, but was in line with Bell Potter’s expectations. Underlying operating profit before tax grew 1% to $405.2 million and was 3% above Bell’s forecast of $392.4 million. The company provided strong revenue guidance and forecasts were upgraded. Bell Potter’s price target dropped to $15 from $15.50, and at APE’s current share price of $13, this implies 15.4% share price growth in a year.
- Trading Central has identified a bearish signal in Rio Tinto (ASX:RIO) indicating that the stock price may close from the close of $123.40 to the range of $114.50 to $116.25 over 62 days, according to the standard principles of technical analysis.
Wall St closed mixed on Wednesday following the release of the Federal Reserve’s latest meeting minutes from earlier this month. The minutes outlined most Federal Reserve policymakers were in favour of slowing the pace of rate hikes in a bid to assess the economy’s progress, however policymakers also agreed unanimously that ongoing increases in the nation’s cash rate would be appropriate. This caused a mixed reaction across Wall St, and enhances fears of a global recession as the cost of living continues to rise.
The Dow Jones ended the midweek session down 0.26% and the S&P500 lost 0.16%, but the Nasdaq rose 0.13%.
Earlier on Wednesday, European stocks closed lower again on Thursday as investors awaited the release of the US Fed’s meeting minutes to gauge insight into whether the Fed will remain hawkish on its stance to tackle inflation. Investors in the region also sold out of markets across Europe also on the back of downbeat earnings reports including British bank Lloyds reporting flat profit growth on the prior year. The STOXX600 fell 0.3%, Germany’s DAX closed flat, the French CAC fell 0.13% and, in the UK, the FTSE100 shed 0.59%.
Taking a look at commodities, iron ore is again the only key commodity trading higher this morning, up 2.31% at US$133/tonne, while oil is down 3.4% at US$73.76/barrel and gold is down almost half a percent at US$1825/ounce.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open 0.3% lower, extending on yesterday’s losses and on the back of the continued global sell-off overnight.
- Australian wages and construction data out yesterday add further support for the RBA to continue its steady rate hike path as opposed to considering any 50-bps hikes in future. Wages growth in Q4 showed growth of just 0.8% for the quarter, which was lower than expectations of 1%, while construction work done in the fourth quarter fell by 0.4% which was well below consensus expectations of a 1.5% increase.
- Stocks trading ex-dividend today include Codan (ASX:CDA), Whitehaven Coal (ASX:WHC), IRESS (ASX:IRE) and JB Hi-Fi Group (ASX:JBH). If you’ve been thinking about these stocks, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Bell Potter has downgraded its price target on Clean Seas Seafood (ASX:CSS) from $0.85 to $0.75 cents per share, but maintain a speculative buy rating on the company following the release of the company’s first half results which were weaker than expected including revenue down 22% YoY and higher feed costs, up 20% YoY. Production costs are also likely to run above previous targets for the near term however for the most part are mitigated by higher average selling prices.
- Trading Central has identified a bullish signal on Xtek (ASX:XTE) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may rise from 73 cents to the range of 83 cents to 85 cents according to standard principles of technical analysis.
Wall Street retreated in the first trading session of the week in the US as rising interest rates continue pressuring investor sentiment, in addition to investors reacting to the latest batch of retail earnings raising concerns over how the consumer is faring the rising interest rate environment. The Dow Jones ended Tuesday’s session down 2.06%, the S&P500 lost 2% and the tech-heavy Nasdaq closed the day down 2.5%. The benchmark 10-year Treasury yield climbed to 3.9%, while the 2-year rate advanced to 4.7%, building on from last week’s gains as investors grappled with hotter-than-expected inflation data. Leading domestic homewares retail chain Home Depot fell 5.4% to a three-month low on Tuesday after warning of weakening demand and issuing a soft profit forecast for 2023, while Walmart, the world’s largest retailer, fell 0.2% after it forecast full-year earnings below analysts’ expectations and issued a warning of hotter-than-expected food prices squeezing profit margins.
In Europe, markets closed lower as investors weighed corporate earnings results against the potential for the US Fed to remain hawkish which enhances the fear of a recession in the coming months. Germany’s DAX fell 0.52%, the French CAC lost 0.37% and, in the UK, the FTSE100 shed 0.46% despite the UK government posting a surprise budget surplus for January. Credit Suisse shares fell on Tuesday following reports that remarks made by the company’s Chairman, Axel Lehmann regarding outflows from the lender, are being reviewed by the Swiss financial regulator on the grounds of potentially being misleading.
What to watch today:
- In commodities, it’s a red run across the commodities board this morning with oil down 1.16% at US$76.28/barrel, gold is down 0.28% at US$1836/ounce, but iron ore is up 1.96% to US$130/tonne.
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open 0.62% lower on the global sell-off overnight.
- Stocks going ex-dividend today include Netwealth Group (ASX:NWL), AGL Energy (ASX:AGL) and Commonwealth Bank (ASX:CBA). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- The Aussie dollar is buying US$0.69, 92.51 Japanese Yen, 57.30 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has increased its rating on Costa Group (ASX:CGC) from a Hold to a BUY and maintains a $3/share price target on the company following the release of full year earnings for CY22, where the company outlined non-recurring quality issues in on-year in citrus should support material recovery in CY23 earnings and the company will benefit from a 19% uplift in productive hectares in the international division.
- Trading Central has identified a bullish signal on AMA Group (ASX:AMA) following the formation of a pattern over a period of 114-days which is roughly the same amount of time the share price may rise from the close of $0.24 to the range of $0.33-$0.35 according to standard principles of technical analysis.
Please note: US markets were closed overnight.
The major US benchmarks closed mixed to end last week, with energy stocks down the most, while yields on the 10-year and 2-year Treasury bonds also weighed on equities. European equities were higher however, boosted by gains in mining stocks.
Coming up this week – the thinking behind monetary decisions at the Fed will be under the spotlight on Wednesday as the US central bank releases the minutes of its latest meeting, while Friday’s release of US Personal Income and PCE, the Federal Reserve’s preferred inflation measure will be closely watched for signs of whether inflationary pressures will re-accelerate or become less intense. Also, US earnings season is also full swing a few big names announcing Q4 results during this week.
What to watch today:
- Our local market is poised to open lower this morning, with the SPI futures suggesting a 0.38% drop.
- It’s another busy day in reporting season – these reports are causing a lot of movement in markets this month. So today we’ll be watching out for AMA Group, BHP, Coles, G8 Education, Tabcorp and Viva Energy.
- BHP Group (ASX:BHP) earnings will be one of the most watched today. Goldman Sachs are expecting underlying EBTDA US$13.7b, NPAT of US$6.9b, and an 88 US cents per share interim dividend, compared to the consensus estimate of 98 US cps.
- In commodities, the oil price is higher, rebounding from an almost two-week low of around US$75 touched last week, as investors weighed optimism about a recovery in Chinese demand against rising US supplies and persistent worries about a global economic slowdown. Gold has steadied after hovering near its weakest levels in seven weeks after hawkish comments from the Fed and strong eco data weighed down on gold, while iron ore has extended its rebound, so keep your eye on iron ore miners this week, such as Champion Iron (ASX:CIA), Fortescue Metals (ASX:FMG), and Rio Tinto (ASX:RIO).
Trading Ideas:
- Following the H1 results for The a2 Milk Company (ASX:A2M) announced yesterday, Bell Potter have reiterated their Buy rating, after A2M reported underlying NPAT ahead of Bell Potter’s expectations. There price target has been increased from $6.80 to $7.65, which at its current share price of $6.49, implies 18% share price growth in a year.
- Trading Central have identified a bearish signal in Metals X (ASX:MLX) indicating that the stock price may fall from the close of $0.33 to the range of $0.23 to $0.25 over 34 days.
The local market closed almost 1% lower on Friday as a sell-off in technology stocks weighed on the key index, with investors fleeing growth stocks in fear of further rate hikes out of the RBA and Federal Reserve.
Baby Bunting (ASX:BBN) fell over 6% on Friday after reporting a 66.5% drop in net profit for the first half, while QBE (ASX:QBE) insurance rallied over 7% on strong first half results including NPAT up 3%.
The winning stocks from Friday’s session were led by QBE (ASX:QBE) Insurance adding over 7%, while A2 Milk Company (ASX:A2M) rose 6.3%, and Corporate Travel Management (ASX:CTD) rallied 4.5%. And on the losing end Block Inc (ASX:SQ2) fell 7.76%, while New Hope Corporation (ASX:NHC) dropped 5.8%, and Centuria Industrial REIT (ASX:CIP) fell 5.76%.
The most traded stocks by Bell Direct clients on Friday were led by the Commonwealth Bank of Australia (ASX:CBA), Magellan Financial Group (ASX:MFG) and Woodside Energy (ASX:WDS).
Wall Street closed mixed on Friday as investor fears of further rate hikes to come from the Fed intensified last week on the back of a few economic reports coming in stronger than expected.
Yields on the 10-year and 2-year U.S. Treasury bonds hit levels not seen since November which weighed on markets during the last trading session or the week.
The Dow Jones rose 0.39%, while the S&P500 fell 0.28% and the Nasdaq closed the day down 0.58%. The Dow Jones notched out a third straight week of losses, and the S&P500 fell for a second week but the Nasdaq rose 0.59% for the week.
Over in Europe, markets closed lower on Friday following a week of economic data released that weighed on investor sentiment. The STOXX600 fell 0.2%, Germany’s DAX lost 0.33%, the French CAC shed 0.25% and, in the UK, the FTSE100 fell 0.1%.
What to watch today:
- Taking a look at commodities, it’s a red start to the week with oil down 2.74% at US$76.34/barrel, coal is down 2.68% at US$214/tonne, gold is up slightly at US$1842.39/ounce and iron ore is up 0.4% at US$127.50/tonne.
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open flat on the back of the mixed session on Wall St on Friday.
- Stocks going ex-dividend today include Zimplat Holdings (ASX:ZIM), Ansell (ASX:ANN), Vicinity Centres (ASX:VCX) and Wesfarmers (ASX:WES). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- The Aussie dollar is buying 69 Us cents, 92.15 Japanese Yen, 57.30 British Pence and 1 New Zealand dollar and 10 cents.
Trading Ideas:
- Bell Potter has increased its price target on OreCorp (ASX:ORR) to 93 cents, from 84 cents, and maintains a speculative buy rating on the company following a number of catalysts coming through including de-risking and the achievement of key milestones at its Nyanzaga Gold Project in Tanzania. The NGP has emerged as an attractive, significant scale, new gold project with strong financial performance metrics in a region that is experiencing a resurgence in investment by the world’s largest mining companies.
- Trading Central has identified a bullish signal on Rumble Resources (ASX:RTR) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may rise from the close of 23 cents to the range of 28 cents to 30 cents according to standard principles of technical analysis.
The Aussie share market fell 0.31% (Mon-Thu), weighed down by US CPI data and investor reactions to reporting season results. An increase to the unemployment rate was also announced this week, strengthening investor appetite for growth stocks.
In this week's wrap, Grady covers:
- (0:29) What the big banks focused on this reporting season
- (2:25) Wesfarmers & Whitehaven Coal's corporate earnings
- (4:26) The best performing stocks in the ASX200
- (5:25) The most traded stocks & ETFs by Bell Direct clients
- (5:55) Two economic news items to watch out for
Wall Street slipped on Thursday to close lower as another piece of economic data was released coming in stronger than expected. For the month of January, US PPI or producer price index rose 0.7% MoM which is the highest growth in 7-monthsand much higher than market forecasts of 0.4%. Goods prices jumped 1.2%, the largest increase since June 2022. The data is another sign this week that the Fed’s aggressive rate hike stance has had little effect in slowing economic growth over recent months. US retail sales also rebounded sharply in January with the largest jump in almost 2 years, climbing 3% for the month which easily topped analysts’ expectations and add further support for the fed to keep raising interest rates to cool inflation in the US. The Dow Jones fell 1.26%, the S&P500 lost 1.38% and the tech-heavy Nasdaq dropped 1.78% on Thursday.
Over in Europe markets closed slightly higher after a choppy session on Thursday as investors digest a slew of economic data released this week giving mixed signals about the Fed’s rate hike pathway moving forward. The STOXX600 rose 0.2%, the French CAC touched an all-time high during the session before retreating to close 0.89% higher, Germany’s DAX added 0.18% and, in the UK, the FTSE100 also rose 0.18%.
What to watch today:
- In commodities oil is trading 0.19% lower at US$78.44/barrel, gold is up 0.29% at US$1841.43/ounce and iron ore is up 1.61% at US$126.50/tonne.
- The Aussie dollar is buying US$0.69, 92.22 Japanese Yen, 57.10 British pence and NZ$1.10.
- Ahead of the local trading session the SPI futures are anticipating the local market to open 0.25% lower.
- Stocks going ex-dividend today include Lendlease Group (ASX:LLC) and Macquarie Group (ASX:MQG). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Qantas (ASX:QAN) following the formation of a pattern over a period of 32-days which is roughly the same amount of time the share price may rise from the close of $6.57 to the range of $7.25 to $7.45 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on NRW Holdings (ASX:NWH) following the formation of a pattern over a period of 68-days which is roughly the same amount of time the share price may fall from the close of $2.80 to the range of $2.41 to $2.49 according to standard principles of technical analysis.
US equities advanced overnight as investors consider the strong retail sales data along with the latest US inflation data, and what this means for the Fed’s interest rate hiking campaign. In the prior session US inflation came in slightly above expectations, with headline year-on-year CPI dropping to 6.4% in January. The data drove yields higher across the curve, with the 20-year yield jumping 10 basis points on the day and 38 basis points in the past month. Moves were more muted further out on the curve, with the 10-year yield rising 4 and 24 basis points respectively, yesterday and in the past month.
Equities had a positive run overnight however; the Dow gained 0.1%, the S&P500 gained 0.28% and the Nasdaq gained 0.9%.
Stocks also moved higher in Europe. The STOXX 600 blue-chip index reversed the morning losses, closing half a percent higher, with most sectors in the green. Construction stocks led gains, while European banking stocks declined. And the UK’s FTSE 100 hit another record high, reaching 8,000 points for the first time. So while economic forecasts for the UK haven’t been too positive, many of the FTSE 100 firms derive their revenue from overseas. The index has seen investors attracted to financials, energy and commodities firms, as well as dividend-paying defensive stocks.
What to watch today:
- The SPI futures are suggesting the Aussie market will open 0.49% higher this morning.
- In commodities,
- Oil prices are trading in the red at around US$78 per barrel, extending losses for a second session amid lingering concerns about weak demand. The latest report from the Energy Information Administration showed that US crude inventories jumped by 16.283 million barrels to 842.973 million last week, which was the highest level since early October. And oil prices have already been under pressure after the US government announced plans to release 26 million barrels of oil from strategic reserves. So keep watch of energy stocks such as Santos (ASX:STO) and Beach Energy (ASX:BPT).
- Meanwhile gold has falled to a one-month low after the US dollar strengthened. So watch gold miners such as Regis Resources (ASX:RRL) and Evolution Mining (ASX:EVN).
- And iron ore has jumped 1.2% higher to US$124.50 per tonne, while seaborne iron ore is just 0.1% higher.
- As for reports to watch out for today, NAB is set to release a Q1 update, plus a long list of companies are set to release their half year results. Some of the names reporting today include AMP, Evolution Mining, Telstra, Goodman Group, Magellan Financial, Newcrest Mining, South32 and Whitehaven Coal just to name a few.
- And in economic data, at 11:30am today January’s unemployment rate will be announced, expected to remain unchanged at 3.5%.
- The Aussie dollar is buying US$0.69, 57 British Pence, and NZ$1.10.
Trading Ideas:
- Bell Potter maintain a BUY rating on DroneShield (ASX:DRO) and have lowered their price target to $0.40. At DRO’s current share price of $0.31, this implies 29% share price growth in a year.
- Trading Central have identified a bearish signal in Bendigo and Adelaide Bank (ASX:BEN) indicating that the stock price may fall from the close of $9.61 to the range of $9.02 to $9.12 over 30 days according to the standard principles of technical analysis.
The ASX fell 1.06% today following the release of stronger-than-expected CPI data out in the US overnight which sent shockwaves through investor confidence, renewing fears of the Fed continuing its aggressive rate hike stance. Investors sold out of financial stocks today amid fears of increasing doubtful debts on bank balance sheets resulting from further rate hikes anticipated. Reporting season also continued today with a number of big names releasing results.
The Commonwealth Bank of Australia (ASX:CBA) reported first half results today that included 10% growth in NPAT, an interim dividend of $2.10/share, Net Interest Margin up 18-basis points to 2.10% and operating performance up 18%. Investors sharply sold out of CBA shares today though after the bank increased its loan impairment expense by 77.1% which management blamed on current macro conditions including rising interest rates and prolonged inflationary pressures.
Australian conglomerate Wesfarmers (ASX:WES) also released first half results today including revenue jumping 27% on the PCP to $22.558bn, 114% increase in Kmart EBIT, overall NPAT up 14% to $1.4bn, and the company declared an 88 cents per share dividend. Wesfarmers’ Chemicals, Energy and Fertilisers revenue jumped 30.2% to $1.4bn, but the company’s Catch business softened to report a $108m loss. Overall, investors were impressed with the results, sending the Wesfarmers share price up 1.8% today.
The winning stocks from today’s session were led by Star Entertainment Group (ASX:SGR) rallying 14.40%, while G.U.D Holdings (ASX:GUD) added 8.10% and Cochlear (ASX:COH) rose 7.75% on the back of first half results. And on the losing end Brainchip Holdings (ASX:BRN) fell 13.56%, Corporate Travel Management (ASX:CTD) lost 8.7% and Treasury Wine Estates (ASX:TWE) dropped 6.91%.
The most traded stocks by Bell Direct clients today were Commonwealth Bank of Australia (ASX:CBA), Beach Energy (ASX:BPT) and Melbana Energy (ASX:MAY).
On the commodities front today, the price of oil took a dive today to just below US$79/barrel after an industry report showed US crude inventories rose by 10.5m barrels last week, well above the expected 321,000 barrel rise. Gold is trading down 0.43% at US$1846/ounce and iron ore is up 1.22% at US$124.50/tonne.
The Aussie dollar is buying US$0.69, 92.23 Japanese Yen, 57.34 British Pence, and NZ$1.10.
US equities were sold-off in the hour of trade following the release of the highly anticipated January CPI report which showed inflation in the US remains stubbornly hot. For January, US inflation came in at a rise of 0.5% which translated to an annual gain of 6.4%, which was above economists’ expectations of a decline in CPI to 6.2% YoY. The way inflation has remained stubbornly high is further support for the Fed to continue raising interest rates for a little while to come in order to cool inflation to the target range of around 2%. Stocks recovered in afternoon trade though to close mixed with the Dow Jones ending the day down 0.46%, while the S&P500 fell just 0.03% and the Nasdaq closed up 0.57%. The winning stocks in the US today were Boeing adding 1.25%, Nike rallying 0.83% and Chevron climbing 0.77%. Coca-Cola and Home Depot each fell 1.6% on Tuesday.
Over in Europe on Tuesday markets closed mostly higher but pared back early gains as investors digested the mixed US inflation data for January that may prompt the Fed to announce further rate hikes. The Stoxx 600 closed 0.1% higher, Germany’s DAX fell 0.11%, the French CAC rose 0.07% and, in the UK, the FTSE100 rose 0.08%.
What to watch today:
- On the commodities front, oil is trading 1.4% lower at US$79/barrel, gold is down 0.28% at US$1848/ounce and iron ore is down 2.38% at US$123/tonne.
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open 0.01% higher following the recovery on Wall St in afternoon trade.
- Reporting season continues today with some big names releasing results today including Commonwealth Bank (ASX:CBA), Wesfarmers (ASX:WES) and Fortescue Metals Group (ASX:FMG).
- The Aussie dollar is buying US$0.70 US cents, 92.84 Japanese Yen, 57.45 British Pence and NZ$1.10.
Trading Ideas:
- Trading Central has identified a bullish signal on Camplify (ASX:CHL) following the formation of a pattern over a period of 11-days which is roughly the same amount of time the share price may rise from the close of $2.05 to the range of $2.47 to $2.57 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Hansen Technologies (ASX:HSN) following the formation of a pattern over a period of 61-days which is roughly the same amount of time the share price may fall from the close of $4.82 to the range of $4.24 to $4.34 according to standard principles of technical analysis.
The local market recovered from Monday’s sell-off on Tuesday to close the session 0.18% higher as investor optimism was boosted by Aussie business confidence jumping for January after dropping at the tail end of 2022. Investors piled into tech stocks today with the sector rising 1.3% at the closing bell as investor appetite for growth stocks increases with every ease in rate hike announcements.
Economic data out today showed Aussie business mood has bounced back rising 6 points in January led by a sharp rise in mining and wholesale sectors. Consumer confidence on the other hand fell 6.9% to 78.5 in February, the weakest level in 3-months as the cost-of-living pressures and interest rate hikes in Australia continue weighing heavily on Aussies.
Reporting season continued to make waves today with investors again very responsive to the provision of first half results.
James Hardie Industries (ASX:JHX) shares came under pressure today after the global building materials company and fibre cement product manufacturer released Q3 results that disappointed investors, driven by a downturn in the US and Australian housing markets. For the quarter, James Hardie reported global net sales declined 4% to US$860.8m, adjusted net income declined 16% to US$129.2m and the company revised its adjusted net income guidance range to US$600m to US$620m, down from the prior range of US$650m to US$710m.
Challenger (ASX:CGF) on the other hand soared 4.41% after also reporting first half results that impressed investors. For the half, the company confirmed its guidance for the full financial year, reported record half year Life division sales of $5.5bn, up 11% driven by record annuity sales growth, normalised NPAT rose 5% to $250m, while statutory NPAT was down at $123m, a 4% increase in the company’s interim dividend to 12cps was also announced, and total assets under management of $99.4bn.
The winning stocks from today’s session were led by Sims (ASX:SGM) adding over 7%, while Domain Holdings (ASX:DHG) and Coronado Global Resources (ASX:CRN) each gained 5.46% and 4.46% respectively.
And on the losing end, Star Entertainment Group (ASX:SGR) tanked almost 13.5% today a day after releasing disappointing first half results, while Ansell (ASX:ANN) fell 8.72% today and Sayona Mining (ASX:SYA) shed 6.12%.
The most traded stocks by Bell Direct clients today were led by Pilbara Minerals (ASX:PLS), Core Lithium (ASX:CXO) and Syrah Resources (ASX:SYR).
We’ve seen lots of movement on the commodities front in recent times amid reports Russia is going to cut oil production and on the back of China’s reopening. Today, crude oil is trading 1.13% lower at US$79.22/barrel, gold is up 0.23% at US$1857/ounce and iron ore is down 2.38% at US$123/tonne.
The Aussie dollar is buying 70 US cents, 91.95 Japanese yen, 57.39 British Pence and 1 New Zealand dollar and 10 cents.
US equities rallied overnight, regaining ground after the S&P500 and the Nasdaq suffered their worst weekly decline in nearly two months. The Dow Jones traded 376.66 points higher or 1.11%, the S&P500 climbed 1.14% and the Nasdaq jumped 1.48%. And the energy minerals sector was the biggest laggard across US markets, with oil and gas companies such as EQT Corporation and Marathon Oil weighing on the sector the most.
European markets also advanced in the first session of the week, as investors braced for US inflation data and a euro zone GDP estimate. The STOXX 600 closed 0.9% higher, Germany’s DAX up 0.6%, France’s CAC up 1.1% and the FTSE100 up 0.8%.
What to watch today:
- The SPI futures are suggesting our local market will open 0.67% higher this morning.
- Reporting season is well underway, with a long list of companies set to release their half year results today. Some big names reporting today include Breville (ASX:BRG), Challenger (ASX:CGF), Charter Hall (ASX:CHC), CSL Limtied (ASX:CSL), Dexus (ASX:DXS), James Hardie (ASX:JHX) and Seek (ASX:SEK), to name a few.
- Suncorp (ASX:SUN) is set to go ex-dividend, which may see its share price fall as investors take their profits.
- In economic data out today, NAB will release its business confidence data for January at 10:30am and Westpac will release its data on consumer confidence for February 11:30am AEDT. Then tonight we’ll be watching out for the unemployment rate out in the UK and CPI out in the US.
- In commodities,
- Oil prices are slightly lower after rebounding at o above US$80 per barrel in the late hours of trade, after falling much of the session as investors balance supplies from Turkey and Russia while awaiting the US CPI report.
- Gold is down 0.5% and is sliding toward its lowest levels in five weeks and is remaining under the pressure.
- Iron ore is 0.5% higher at US$126 per tonne.
Trading Ideas:
- Bell Potter maintain a BUY rating on Beach Energy (ASX:BPT) following the release its half year earnings, which saw underlying EBITDA of $491m and NPAT of $191m, both consistent with Bell Potter’s estimates. The company also declared a 2cps fully franked dividend. The energy company has strong, fully funded production growth outlook, diversified across five energy basins and across four separate gas markets. Bell Potter have lowered their price target from $2.25 to $2.21 and at BPT’s current share price of $1.52, this implies 45.9% share price growth in a year.
- Trading Central have identified a bearish signal in CSR Limited (ASX:CSR), indicating that the stock price may fall from the close of $5.04 to the range of $4.98 to $5.09 over 23 days, according to the standard principles of technical analysis.
The local market has started the week in negative territory, closing Monday’s session down 0.21%, dragged lower by a sharp sell-off in consumer discretionary stocks amid the release of some disappointing half year results today. The energy sector on the other hand soared just under 2% today buoyed by an early rise in the price of oil amid reports Russia will cut production of the commodity.
Reporting season ramped up today with a number of big names reporting including JB Hi-Fi (ASX:JBH), Endeavour Group (ASX:EDV) and Carsales.com (ASX:CAR).
Endeavour Group (ASX:EDV) shares took flight following the release of the results as the company outlined its performance through the first restriction-free festive season in three years. For the first half of FY23, Endeavour Group reported group sales up 2.6% to $6.5bn, Group NPAT rose 17% to $364m which well exceeded consensus expectations, and a dividend per share of 14.3 cps was declared which is a premium of 14.4% on the PCP. CEO Steve Donohue attributed the strong results to customers returning to a more normal holiday period in December, and the return of domestic travel seeing regional and coastal town stores and hotels performing strongly.
Star Entertainment Group (ASX:SGR) tanked over 20% to an all-time low share price today after releasing disappointing, unaudited first half results and outlook this morning. The casino and hotel giant said it has been adversely impacted by several factors, in particular by increased operating restrictions from mid-September following the Bell Review and amendments to the NSW Casino Control Act. The company also blamed ongoing remediation actions and high costs for improved compliance, and increased competition for the poor results. For the half, The Star reported Sydney domestic revenue was down 13.5% on pre-COVID levels and will detail the full performance when the final results are released. The company did provide outlook for the remainder of FY23 with the expectation to report underlying EBITDA between $330m - $360m.
Monadelphous (ASX:MND) shares rallied today after the engineering group announced it has secured new contracts in the resources and energy sectors totalling around $200m, including with sector leaders like BHP Group (ASX:BHP) and Rio Tinto (AAX:RIO).
The winning stocks from today’s session were led by Insurance Australia Group (ASX:IAG) rallying 4.5% on the back of releasing H1 results, while Endeavour Group (ASX:EDV) added 4.11% and Coronado Global Resources (ASX:CRN) jumped 3.6% today. And on the losing end Star Entertainment Group (ASX:SGR) led the losses today plunging 20.8%, while Imugene (ASX:IMU) and Aurizon Holdings (ASX:AZJ) each fell 10.34% and 6.5% respectively.
The most traded stocks by Bell Direct clients today were BHP Group (ASX:BHP), New Hope Corporation (ASX:NHC) and Suncorp Group (ASX:SUN).
Taking a look at commodities oil has pivoted lower this afternoon to trade to trade at US$78.73/barrel on rate hike worries, while gold is down 0.32% at US$1858/ounce and iron ore is trading up 0.4% at US$126/tonne.
The Aussie dollar is buying US$0.69, 91.33 Japanese Yen, 57.32 British Pence and NZ$1.10.
Technology retailer JB Hi-Fi (ASX:JBH) released first half results this morning with performance coming in, in-line with Bell Potter and Citi expectations, but just short of Consensus expectations.
For the half, JB Hi-Fi reported total sales rose 8.6% to $5.28 billion driven by elevated demand for consumer electronics and home appliances INCLUDING well executed Black Friday and Boxing day sales. EBIT rose 14% over the half to $479.2 million, NPAT increased 14.6% to $329.9 million, and EPS rose 20.4% to 301.8cps. An interim dividend was announced, up 20.9% to 197cps or $1.97/share.
The company also owns The Good Guys which experienced a 7.3% rise in total sales to $1.54bn over the half, driven by key growth in Refrigeration, laundry, floorcare, visual and Audio sales.
Notably, the company failed to provide any quantitative outlook for the second half of FY23 which we have seen investors punish companies for on the share price front this reporting season already.
The company’s CEO Terry Smart said trading conditions starting to normalise following two-years of COVID-disruptions. “Our relentless focus on providing the best value and high levels of customer service every day, both in store and online, continues to resonate with our customers.”
As markets expect a decline in consumer spending on discretionary goods over the coming months in this high interest rate environment, we may see some headwinds faced for JB Hi-Fi to come over the second half of FY23.
The local market ended Friday’s session down 0.76% as every sector aside from consumer staples stocks ended the day in the red, heavily weighed down by a sharp sell-off in technology stocks. The local market suffered its worst trading week since September last week, ending the week down 1.65%, weighed down by a sharp sell-off in real estate and tech stocks.
The winning stocks on Friday were, Imugene Limited (ASX:IMU) rallying 7.41%, while United Malt Group (ASX:UMG) and Johns Lyng Group (ASX:JLG) each added 4.8% and 3.53% respectively. And on the losing end, New Hope Corporation (ASX:NHC) tumbled 8.61% on a fall in the price of coal. News Corp (ASX:NWS) and Capricorn Metals (ASX:CMM) each fell 6.8% and 6.3% respectively.
The most traded stocks by Bell Direct clients on Friday were Fortescue Metals Group (ASX:FMG), Arafura Rare Earths (ASX:ARU) and the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR).
Over in the US, Wall St closed mixed on Friday as investor optimism faded on the back of comments made by Fed Chair Jerome Powell about inflation in the region starting to cool but there still being a long way to go in terms of rate hikes to cool inflation to the target range. The Dow Jones rose 0.5% the S&P500 rose 0.22% but the tech-heavy Nasdaq fell 0.61%. Google parent, Alphabet’s, shares fell more than 4% on Friday as investors grow increasingly concerned about the rising competition in the artificial intelligence space, especially from new market entrant, ChatGP.
And in Europe, markets closed lower on Friday as investors in the region also keep a close eye on the US fed’s movements and commentary around further rate hikes to come. UK preliminary fourth-quarter GDP figures were also out on Friday showing the UK economy expanded by 0.01%, narrowly avoiding a recession. The FTSE100 closed Friday’s session 0.36% lower, while Germany’s DAX lost 1.39%, and the French CAC fell 0.82%.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open flat to start the new trading week.
- On the reporting season calendar for today, Beach Energy (ASX:BPT), Endeavour Group (ASX:EDV) and JB HiFi (ASX:JBH) are all set to release first half results.
- In commodities, crude oil is trading 2.13% higher at US$79.72/barrel, coal is down 3.33% at US$218/tonne, gold is up 0.21% at US$1865.38/ounce and iron ore is up 0.4% at US$126/tonne.
- The Aussie dollar is buying US$0.69, 90.96 Japanese Yen, 57.3 British Pence and NZ$1.10.
Trading Ideas:
- Bell Potter has downgraded its price target on GrainCorp (ASX:GNC) from $8.25 to $8.00 but maintains a Hold rating on the company following the release of GrainCorp’s recent harvest update ahead of the company’s AGM. The recent update demonstrates receivals are lagging other large crop years, as well as spot Australian canola meal has moved from a premium to a discount compared to Canadian meal.
- Trading Central has identified a bullish signal on Neometals (ASX:NMT) following the formation of a pattern over a period of 71-days which is roughly the same amount of time the share price may rise from the close of $0.87 to the range of $1.04 to $1.08 according to standard principles of technical analysis.
The Aussie share market fell almost 1% (Mon-Thu), on the back of the RBA raising the nation's cash rate by 25-basis points to 3.35%. And reporting season opened with some of Australia’s biggest companies announcing their results.
In this week's wrap, Grady covers:
- (0:30) How investors have reacted to company results
- (0:57) Suncorp, Boral, AGL Energy & Amcor's corporate earnings
- (4:25) The best performing stocks in the ASX200
- (5:50) The most traded stocks & ETFs by Bell Direct clients
- (6:23) Three economic news items to watch out for
New York edged lower overnight amid renewed rate-worry weakness. All three major benchmarks closed in the red, and all eleven of the S&P500 industry sectors closed lower. The Dow Jones is down 0.7%, the S&P500 down 0.9% and the Nasdaq down just over 1%.
Over in Europe however, equities rallied, with the STOXX 600 closing 0.6% higher, Germany’s DAX up 0.7%, France’s CAC up 1% and the FTSE 100 up 0.3%.
What to watch today:
- Following US equities overnight, the SPI futures are suggesting the ASX200 will drop 0.35% at the open this morning.
- In commodities, oil prices are down almost 1%, pausing a three-day rally as rising US inventories offered a bleak picture for domestic demand. Gold is also in the red again, after rebounding further from one-month lows. And iron ore is down 0.5% to US$124 per tonne.
- In economic news, today the RBA will release a statement on monetary policy.
- And companies reporting today includes News Corp (ASX:NWS) and REA Group (ASX:REA).
- United Malt Group (ASX:UMG) is set to hold its AGM today.
Trading Ideas:
- Bell Potter maintain a BUY rating on DDH1 (ASX:DDH) following a strong set of preliminary earnings results. They have increased their price target from $1.44 to $1.47, and at DDH’s current share price of $0.99, this implies 48.5% share price growth in a year.
- Trading Central have identified a bearish signal in Perseus Mining (ASX:PRU) indicating that the stock price may rise from the close of $2.04 to the range of $1.63 - $1.71, over 62 days, according to the standard principles of technical analysis.
The overnight retreat on Wall Street weighed down the local stock market, with the ASX200 closing the day 0.53% lower. The utilities sector led the fall on the back of the weak half year result from AGL Energy. It’s shares dropped 9.6% as it halved its dividend and lowered the top end of its annual guidance ranges. Underlying NPAT fell 55% year-on-year to $87 million, and underlying EBITDA fell 16% to $604 million. The company reported a statutory loss after tax of $1.1 billion, which includes $706 million of impairment charges (post-tax) from AGL’s accelerated decarbonisation plans.
Technology stocks tracked the softness of their US peers – Megaport (ASX:MP1) dropped more than almost 6%, after reporting promising results. The company finished the period with an EBITDA margin of 6%, and total revenue was up 38% to $70.7 million.
Financials were mixed today, after ANZ reported a solid first quarter. Its shares closed higher, while its major rivals were lifted about 0.2%.
Taking a look at commodities, well the first Australian coal cargoes have arrived in China and are awaiting customs clearance. Two vessels carrying Australian coal have reached China for the first time since an unofficial ban on imports was introduced over 2 years ago and several more are on the way. They are being closely monitored by coal traders as they are keen to see how smooth Chinese customs procedures will be.
And the winning stocks today were De Grey Mining (ASX:DEG), IDP Education (ASX:IEL) and Downer (ASX:DOW). The stocks that declined the most were AGL Energy (ASX:AGL), Coronado Global Resources (ASX:CRN) and Whitehaven Coal (ASX:WHC).
And the most traded stocks today by Bell Direct clients were BHP(ASX:BHP), Argosy Minerals (ASX:AGY), Whitehaven Coal (ASX:WHC), AGL (ASX:AGL) and ANZ (ASX:ANZ).
Lastly, the Australia dollar is slightly higher, with $1 buying US$0.70, 57.93 British Pence, 91.42 Japanese Yen and NZ$1.10.
US stocks slid at the closing bell of the midweek session as investors shifted focus back to corporate earnings reports and away from dovish comments by Fed Chair Jerome Powell about the future of US cash rate hikes amid slowing economic growth.
Lumen Technologies tanked more than 20% after reporting a fourth-quarter loss of US$3.1bn and provided guidance for the year that fell well short of Wall St expectations. Disney on the other hand reported results after the closing bell that topped analysts’ expectations including a loss of US$1.05bn which was less than Wall Street had predicted, earnings per share of 99 cps, well above the expected 78 cents per share, revenue of US$23.61bn and total Disney+ subscriptions of 161.1m which declined by around 2.4million on the back of a recent price increase. The Dow Jones fell 0.61%, the S&P500 tumbled 1.11%, and the Nasdaq lost 1.68% on Wednesday.
Over in Europe markets rallied on Wednesday following dovish comments from Fed chair Jerome Powell as well as investors digesting mixed corporate earnings reports. Jewellery company Pandora rose 12% on upbeat earnings results including quarterly sales hitting 9.9 billion Danish Crowns or $1.43 billion dollars, and annual sales around 26bn in 2022. The UK’s FTSE100 hit an intraday record high before paring back gains to close the day up 0.3%. In Germany, the DAX added 0.6% while the French CAC fell 0.18% on Wednesday.
What to watch today:
- Taking a look at commodities today, crude oil is trading 1.57% higher at US$78.35/barrel, gold is flat at US$1874/ounce and iron ore is trading down 0.8% at US$124.50/tonne.
- The Aussie dollar is buying US$0.69, 90.97 Japanese yen, 57.56 British pence, and NZ$1.10.
- Ahead of the local trading session the market is expected to open 0.42% lower following the sell-off on Wall St overnight.
- On the economic data front today, there is no local economic data out today however investors will be awaiting the release of the RBA statement on Monetary Policy out tomorrow.
Trading Ideas:
- Bell Potter has increased the price target on Microba Life Sciences (ASX:MAP) from $0.40 to $0.60 following the execution of an exclusive distribution agreement with Luminary Health Centres to distribute a microbiome test powered by Microba’s testing technology, to consumers in the US. Bell Potter sees the deal has locked in revenue for the next 12-months and is the driver of the price target increase for Microba.
- Trading Central has identified a bullish signal on Race Oncology (ASX:RAC) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may rise from the close of $2.05 to the range of $2.15-$2.19 according to standard principles of technical analysis.
The ASX rallied 0.35% today, rebounding from yesterday’s rate-driven sell-off as investors piled into financial and material stocks today, while selling out of health care and consumer staples stocks.
Boral (ASX:BLD) shares took flight today, adding over 12% after the building and construction materials supplier released first half results including revenue up 12% to $1.681bn, EBIT up 15% at $95.3m, NPAT increased 53% to $56.8m and adjusted EPS rose 50% to 5.1c/share. New Boral CEO Vik Bansal said RBA rate hikes haven’t crimped customer demand for cement, asphalt and gravel.
Suncorp (ASX:SUN) shares jumped 4.5% today after the Queensland-based financial conglomerate released first half results including group net profit up 44.3% to $560m, and cash earnings up 62.9% to $588m. The company also boosted its dividend payout to 33 cents per share, representing a 71% payout ratio of cash earnings. Group operating expenses fell 3.1% to $1.349bn, largely reflecting efficiency benefits from the strategic program of work, and the company reaffirmed its FY23 financial targets which investors have been looking for companies to share this reporting season.
Strike Energy (ASX:STX) has accepted Hancock Prospecting’s takeover offer of Warrego Energy for $0.40/share, over its own one-for-one scrip offer for the takeover of Warrego. Strike said despite not acquiring control of Warrego, it has achieved a number of key milestones over the last 6-months including share price appreciation of 40%, $116m in immediately available cash funding following the acceptance of Hancock’s offer, and Strike’s joint venture partner will be controlled by a credentialed, well-funded and motivated counterparty to pursue development activity in respect of the West Erregulla gas project.
The winning stocks today were led by Boral (ASX:BLD) soaring almost 13%, Imugene (ASX:IMU) rallying 7.7% and Suncorp (ASX:SUN) climbing 4.6%.
And on the losing end of the market, Elders (ASX:ELD) fell more than 5.8% after the company was sent a price query from the ASX today, while Healius (ASX:HLS) fell 5.4% and Ramelius Resources (ASX:RMS) lost 4.12% today.
The most traded stocks by Bell Direct clients today were Macquarie Group (ASX:MQG), Pilbara Minerals (ASX:PLS) and Tennant Minerals (ASX:TMS).
On the commodities front this afternoon, crude oil is flat at US$77.16/barrel, iron ore is down 0.8% at US$124.50/tonne and gold is up 0.13% at US$1876.33/ounce.
The Aussie dollar is buying 70 US cents 91.32 Japanese Yen, 57.24 British Pence, and 1 New Zealand Dollar and 10 cents.
Over in the US today, stocks closed higher as investors digested Fed Chair Jerome Powell’s speech to gain insight into just how long the Fed will continue raising interest rates to tackle inflation in the US. Jay Powell once again made dovish comments in his speech, reassuring markets that the disinflationary pressures have begun, particularly in the goods sector, while also saying that the Fed has the strategy in place to bring down inflation to its target 2%. At the same time, Jay Powell acknowledged the robust January jobs report but mostly shrugged it off.
Stocks recovered from an early sell-off after Powell’s speech, with the Dow Jones closing Tuesday’s session up 0.8%, the S&P500 adding 1.29% and the tech-heavy Nasdaq jumped 1.9%.
US trade balance data for December was also released yesterday showing the US trade deficit widened to US$67.4bn in December, the lowest level since September 2020, and down from US$61bn in November. Exports in the region fell 0.9% for the month while imports rose 1.3%.
In Europe, markets closed mostly lower as investors look to the latest slew of economic data and interest rate outlook. The euro zone PMI index showing business activity in a single currency returned to growth in January for the first time in 6-months, while the US jobs report last Friday came in much stronger than expected. Germany’s DAX fell 0.16%, the French CAC fell 0.07% and, in the UK, the FTSE100 rose 0.36%.
On the commodities front, oil is trading 3.5% HIGHER at US$76.71/barrel, gold is down 0.51% at US$1877.39/ounce and iron ore is down 0.8% at US$125.50/tonne.
What to watch today:
- Ahead of the local trading session here in Australia, the ASX is poised to open 0.46% higher following the rally on Wall St overnight.
- The Aussie dollar is buying 69 US cents, 90.99 Japanese Yen, 57.24 British Pence and 1 New Zealand dollar and 10 cents.
Trading Ideas:
- Bell Potter has maintained a buy rating on luxury online fashion retailer Cettire (ASX:CTT) following the release of the company’s first half results yesterday. For the half, Cettire reported sales revenue of $187.7m, up 65% on the PCP and a strong start to the second half with 80% sales revenue increase in January. Bell Potter has also increased its price target on Cettire to $2.40 from $2.30 on the belief that Cettire will continue to outperform its peer group consisting of global luxury retailers and local e-commerce players given its less than 1% market share in a large and growing market which could remain more resilient than other discretionary categories.
- Trading Central has identified a bullish signal on Medibank Private (ASX:MPL) following the formation of a pattern over a period of 74-days which is roughly the same amount of time the share price may rise from the close of $3.03 to the range of $3.21-$3.25 according to standard principles of technical analysis.
The RBA today announced the nation’s cash rate will increase by 0.25% or 25 basis points, to 3.35% in a move widely expected by the markets. RBA governor Philip Lowe said ‘global inflation remains very high’ and warned further rate hikes will be needed in coming months to bring inflation back to the target range.
The ASX tanked immediately after the announcement following warnings from Philip Lowe that further rate hikes are needed in coming months, despite the rate hike today meeting market expectations, which saw the usual rate-hike sensitive suspects including REIT stocks sold off post the announcement as investors anticipate further impact to REIT stock balance sheets on the back of this next interest rate hike.
For the day though, the key index ended the session down 0.46%. Hot takeover target Nitro Software (ASX:NTO) received a proposal from Potentia Capital to engage with Nitro in relation to gaining access to due diligence, with a view to potentially increase its current $2/Nitro share off-market takeover offer to the range of $2.20 to $2.30 per share. Nitro shareholders are cautioned that there is no certainty Potentia will increase its offer for the Nitro takeover, and the current $2/share bid from Potentia is inferior to the Alludo takeover offer of $2.15/share that is set to expire on 3rd March. The Nitro board is currently seeking advice from its external financial and legal advisors.
Nuix (ASX:NXL) skyrocketed 40% today after the investigative analytics and intelligence software company announced the Federal Court of Australia has delivered its judgement in relation to the proceedings brought by former Nuix boss, Edward Sheehy against Nuix. The Federal Court this morning dismissed Mr Sheehy’s claims and said there is no requirement for Nuix to amend its options register and that Mr Sheehy is not entitled to any monetary compensation from the company. The initial claims Mr Sheehy made were him being owed options and entitlement of shares to the value of $183m plus interest, which today was dismissed.
The winning stocks today were led by New Hope Corporation (ASX:NHC) rallying 3.70%, Link Administration (ASX:LNK) adding 3.43% and Magellan Financial Group (ASX:MFG) ending the day up 3.36%.
And on the losing end ARB Corp (ASX:ARB) tanked more than 12% after Macquarie responded to the companies half year trading update, downgrading ARB to neutral. Lifestyle Communities (ASX:LIC) fell 5.7% today and Centuria Capital (ASX:CNI) lost 5.58%.
The most traded stocks by Bell Direct clients today were Newcrest Mining (ASX:NCM), Telix Pharmaceuticals (ASX:TLX) and New Hope Corporation (ASX:NHC).
Australia’s trade balance data for December was also released today, showing the country’s trade surplus declined to $12.237bn for the month, down from $13.475bn in November. The trade surplus decline was larger than economists were expecting and mainly driven by surging cost pressures on exports against imports growing amid China’s easing of tough COVID restrictions. Exports for the month fell 1.4% from November, while imports rose 1% from November. Overall, Australia posted its fifth straight year of trade surplus buoyed by robust sales of key commodities like iron ore and natural gas.
Taking a look at commodities, oil is trading almost 1% higher at US$74.78/barrel, gold is up 0.32% at US$1873.11/ounce and iron ore is down 0.8% at US$125.50/tonne.
Looking at global markets, the energy sector is underperforming: it’s been the worst performing sector month-to-date in all regions. Weakness in energy equities has coincided with that of energy commodities: all members of the petroleum complex, are down year-to-date, as well as Natural Gas down 41% so far in 2023. Information technology on the other hand, has outperformed everywhere, in particular, the sector’s lead the most pronounced in Canada, where information tech has outperformed their S&P TSX Composite by more than 5% so far this month.
Overnight, all three US benchmarks closed lower. The Dow closed down 0.1%, making up some ground after losing more than 240 points earlier in the session. The S&P500 down 0.6% and the Nasdaq down 1%. US Treasury yields rose on bets the Federal Reserve has more room to lift rates. The yield on the US 10-year note surged 10 basis points to 3.63%.
Markets in Europe also fell. The STOXX 600 closed 0.8% lower with all sectors but healthcare and utilities trading in the red.
What to watch today:
- The SPI futures are suggesting that our local market will open 0.11% lower this morning, after US stocks extended losses.
- Investors are awaiting the policy decision by the Reserve Bank. It is widely expected that the RBA will lift the cash rate a further 25 basis points and that announcement is scheduled for 2:30pm AEDT today. Also, in economic news, Australia’s Balance of Trade data for December will be out at 11:30am. The last announcement was in November, when Australia saw its largest trade surplus since June.
- Company earnings to watch out for today: Cettire (ASX:CTT) and Transurban Group (ASX:TCL) will release their half-year results, while Macquarie (ASX:MQG) is set to release their quarterly report.
- In commodities:
- Oil prices are trading 1.6% higher at US$74.55 per barrel. And China’s economy may be looking at a stronger-than-anticipated rebound that will boost demand for crude.
- Gold is steady, hovering near its lowest level in a month, amid a general US dollar strength, as stronger-than-expected US jobs data suggested the Fed has more room to hike interest rates.
- Iron ore is up 1% at US$126.50 per tonne.
Trading Ideas:
- Bell Potter maintain a Buy rating on Adrad Holdings (ASX:AHL) and it’s well worth a look at the current share price. The company is profitable, it just reiterated guidance, they have a strong cash position and FY23 PE ratio of less than 10 times. The downside however is that the CEO has announced intention to resign, the earnings outlook this year is flat and liquidity is low. However, Bell Potter haven’t changed to their forecasts. They forecast FY23 revenue and EBITDA of $137.9 million and $16.6 million, consistent with the guidance. They have lowered their price target by 6% to $1.60 and at AHL’s current share price of $1.05, this implies 51.7% share price growth in a year.
- And lastly, Trading Central have identified a bearish signal in Northern Star Resources (ASX:NST) indicating that the stock price may fall from the close of $12.58 to the range of $11.65 to $11.85 over 24 days according to the standard principles of technical analysis.
The local market started the week in negative territory, closing the day down 0.25%, ahead of the RBA’s rate hike decision for February out tomorrow, which is the first interest rate decision for 2023. Real estate stocks were the hardest hit today as investors anticipate the impact another rate hike will have on RIET stock balance sheets, with the sector closing Monday’s session down more than 1.6%.
Furniture retailer Nick Scali (ASX:NCK) tumbled more than 13% today after posting first half results including a 12.1% decline in written sales orders for January 2023, revenue growth of 57.4% and NPAT up 70.2% on the prior corresponding period. Investors may be selling out of the furniture retailer’s shares today after the company failed to provide guidance beyond January, citing it ‘2H FY23 results will depend upon trading during February to April and at this point it is difficult to provide further guidance’, which didn’t impress investors, sparking fears of tougher times to come as interest rates continue rising and consumer spending declines.
Beach Energy (ASX:BPT) shares lifted today after the gas producer released an update on its Waitsia Stage 2 project. The oil and natural gas explorer and producer today said it has reached an agreement with Webuild for the completion of the Waitsia stage 2 project with the Waitsia joint venture and Webuild now targeting first gas by the end of 2023, 6-months later than the original target date, at an increased CAPEX estimate of $400-$450m, up from the original $350-$400. Webuild’s acquisition of Clough, who was originally contracted to complete the Waitsia project, will see a seamless transition for the Webuild team to complete the Waitsia project.
Hot takeover target Warrego Energy (ASX:WGO) rose 3% today after Gina Rinehart’s Hancock Prospecting confirmed it has increased its takeover bid for the company to 36 cents per share from 28 cents per share, to end the bidding war over Warrego with Hancock Prospecting now having a 50.54% stake in the company. The increase in Hancock’s holding was made possible by Hancock partner Mineral Resources selling its shares in Warrego to Hancock for 36 cents per share.
The winning stocks from today’s session were Newcrest Mining (ASX:NCM) adding 9.3% after receiving a takeover offer, Beach Energy (ASX:BPT) rallied 3.7% on the Waitsia update and Incitec Pivot (ASX:IPL) added 3.22%. And on the losing end, Lake Resources (ASX:LKE) led the losses today closing down 6.21% while Sayona Mining (ASX:SYA) fell 5.77% and Core Lithium (ASX:CXO) dropped 5.75% today.
The most traded stocks by Bell Direct clients today were Rio Tinto (ASX:RIO), Newcrest Mining (ASX:NCM) and Macquarie Group (ASX:MQG).
Taking a look at commodities crude oil has recovered this afternoon to trade 0.18% higher at US$73.51/barrel as the International Energy Agency sees China’s economy could be poised for a stronger-than-expected rebound which will boost demand for crude. Coal is down 3.67% at US$236/tonne, gold is up 0.66% at US$1877/ounce and iron ore is up 0.8% at US$126.50/tonne.
The Aussie dollar is buying US$0.69, 91.51 Japanese Yen, 57.26 British Pence and NZ$1.10.
The local market ended the week 0.86% higher following a 0.62% rally on Friday led by a surge in healthcare and real estate stocks, while investors sold out of utilities and materials stocks on Friday.
The winning stocks from Friday’s session were Pinnacle Investment Management (ASX:PNI) adding 9.58%, BrainChip Holdings (ASX:BRN) rallying 5.56%, and HMC Capital (ASX:HMC) adding almost 5%. On the losing end of the market on Friday, investors sold out of Ramelius Resources (ASX:RMS), Paladin Energy (ASX:PDN) and Regis Resources (ASX:RRL), with each losing over 6.5%.
The most traded stocks by Bell Direct clients on Friday were CSL Limited (ASX:CSL), Whitehaven Coal (ASX:WHC) and Pilbara Minerals (ASX:PLS).
Over in the US on Friday, markets turned lower after surprisingly strong jobs data sparked concerns over the Fed’s aggressive interest rate stance moving forward, and investors digested a mixed bag of earnings reports. US jobs growth accelerated sharply in January with nonfarm payrolls surging to 517,000 jobs for the month, well above the expectation of 185,000 jobs added in the month. The US unemployment rate hit a more than 53 year low of 3.4% in another sign the US labour market remains tight despite the Fed’s best efforts to cool inflation and ease the tight labour conditions. Apple shares rose 2.4% on Friday after the tech giant forecast that revenue would fall for a second straight quarter but that iPhone sales would likely improve as production in China returns to normal. The Dow Jones closed Friday’s session 0.38% lower, the S&P500 lost 1.04% and the Nasdaq fell 1.59%.
Over in Europe, markets closed mostly higher on Friday as investors digested key central bank interest rate decisions, economic data and corporate earnings reports. The UK’s FTSE100 hit a record high on Friday partly driven by the pound dropping against the USD. The markets also rallied despite the Bank of England raising interest rates to their highest level since 2008 on Thursday.
Germany’s DAX fell 0.21% on Friday, while the French CAC rallied almost 1% and, in the UK, the FTSE100 rose 1.04%.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open Monday’s session 0.16% higher.
- On the commodities front oil is trading sharply lower, down 3.28% at US$73.39/barrel, iron ore is up 0.8% at US$126.50/tonne and gold is down 2.48% at US$1864.91/ounce.
- The Aussie dollar is buying US$0.69, 91.37 Japanese Yen, 57.43 British Pence, and NZ$1.09.
- On the economic data front investors will be awaiting the RBA’s latest interest rate decision out tomorrow alongside Australia’s trade balance data for December also out tomorrow.
Trading Ideas:
- Trading Central has identified a bullish signal on Lendlease Group (ASX:LLC) following the formation of a pattern over a period of 81-days which is roughly the same amount of time the share price may rise from the close of $8.97 to the range of $10.60-$10.90 according to standard principles of technical analysis.
- Trading Central has identified a bullish signal on Chorus (ASX:CNU) following the formation of a pattern over a period of 34-days which is roughly the same amount of time the share price may rise from the close of $7.89 to the range of $8.31-$8.41 according to standard principles of technical analysis.
The Aussie share market added 0.24% this week (Mon-Thu), as investors awaited the highly anticipated rate decision out of the Federal Reserve in the US. Information technology stocks had the biggest boost this week, coat tailing on the tech-heavy Nasdaq as investors regain appetite for growth stocks.
In this week's wrap, Grady covers:
- (0:28) Where inflation is hitting hardest in the current environment
- (2:07) What the current inflation rate & RBA rate hike means for markets
- (3:36) The best performing stocks in the ASX200
- (5:06) The most traded stocks & ETFs by Bell Direct clients
- (5:36) Three economic news items to watch out for
US stocks eased in afternoon trade, with earnings pending after the closing bell from Apple, Alphabet and Amazon. The Nasdaq was up more than 2% when the final hour of the session began, after rising 3.5% earlier in the day. The Nasdaq’s rally was boosted by Meta Platforms, which was 22% higher by 3pm after the company announced its plans to buy US$40 billion worth of its own shares. The Nasdaq then rebounded, closing the session 3.25% higher, while the S&P500 closed 1.47% higher and the Dow Jones ended 0.11% in the red.
European markets rallied overnight, with all major benchmarks closing higher, after the Bank of England and the European Central Bank announced they’d would hike interest rates by 50 basis points, as widely expected.
What to watch today:
- The SPI futures are this morning indicating that our local market will open 0.13% higher this morning.
- In commodities, oil prices edged lower overnight. The gold price is set to end the week in the red, currently trading 1.9% lower. While iron ore has also dropped, after rallying in the previous session, as global economic growth concerns appear to weigh on prices.
- Economic data to watch out for: tonight the unemployment rate for January in the US will be announced, and the Producer Price Index for December for the Eurozone will be announced as well.
- CSL Limited (ASX:CSL) share price will be on watch today, after competitor GSK received FDA approval for a competing drug. CSL is also set to release its half-year earnings on February 14th. Ahead of the announcement, Morgan Stanley reiterated their Overweight rating on CSL, with a target of $354.
- And the Australian dollar is currently buying US$0.71, 57.01 British Pence, 91.75 Japanese Yen and NZ$1.09.
Trading Ideas:
- Bell Potter maintain a Buy rating on DGL Group (ASX:DGL). They’ve made no net changes to the drivers of the company’s underlying business but have upgraded their EPS forecasts 2-7% across FY23-25 expectations. That’s for the recent all cash Nightingale Transport acquisition for $18.2 million, which is an attractive deal in Bell Potter’s view. There is no change to the BUY rating, however Bell Potter’s price target is reduced from $2.25 to $2. At DGL’s current share price of $1.49, this implies 34.2% share price growth in a year.
- And Trading Central have identified a bullish signal in IDP Education (ASX:IEL), indicating that the stock price may rise from the close of $31.80 to the range of $36.25 to $37.25 over 26 days, according to the standard principles of technical analysis.
The ASX followed in Wall Street’s footsteps on Thursday after the Fed eased its rate hike pace for February. The local market rallied 0.13% on Thursday driven by a surge in technology stocks after the Nasdaq rose more than 2% in the US overnight.
CBA economist Gareth Aird today said there’s a risk the Reserve Bank raises interest rates by 40-basis points next Tuesday coupled with a statement of an intention to pause. The prediction comes as wider markets expect a 20-basis point rate hike from the RBA on Tuesday.
Pinnacle Investment Management shares took a dive today after the company missed earnings expectations in half year results. The company reported profits down 24% in the prior corresponding period which fell short of UBS estimates, and EPS fell 8% below Macquarie’s expectations. The hardest hit to Pinnacle was the company reporting affiliates generated performance fees which contributed only $900k to Pinnacles profits, down from $6.4m prior. UBS also downgraded Pinnacle to a sell rating from neutral prior to the results being released.
The winning stocks from today’s session were Megaport (ASX:MP1) adding 11.11%, Xero (ASX:XRO) rallied 7.5% and Wisetech Global (ASX:WTC) rose 6.77%.
And on the losing end of the market QBE (ASX:QBE) Insurance fell 4.76%, Computershare (ASX:CPU) lost 3.63% and Virgin Money UK (ASX:VUK) lost 3.6%.
The most traded stocks by Bell Direct clients were Rio Tinto (ASX:RIO), Wesfarmers (ASX:WES) and CSL (ASX:CSL).
On the commodities front, oil is up 1.21% at US$77.33/barrel, gold is up 0.13% at US$1952/ounce and iron ore is down 0.78% at US$128/tonne.
The Aussie dollar is buying 71 US cents, 91.84 Japanese Yen, 57.43 British Pence and 1 New Zealand dollar and 9 cents.
The bank of England interest rate decision is out later tonight with the market expecting a 50-basis point hike, which is likely to impact the FTSE100’s session on Thursday in the UK.
The Federal Reserve has raised the US cash rate by 25-basis points as the market expected at the conclusion of the FOMC meeting overnight. The Fed has now eased rate hikes for a second straight month for the cash rate to sit between 4.5%-4.75% but said it will need to continue raising rates in order to reach a stance of monetary policy that is sufficient to return inflation to the target 2%. Recent favourable economic data including lower consumer spending and slowing economic growth in the US were contributing factors to the Fed’s rate hike decision.
US markets rebounded in afternoon trade to close the day higher as the Fed pulled back its pace of rate hikes. The Nasdaq rose 2% boosted by gains in chipmakers on the back of strong earnings out of Advanced Micro Devices. The S&P500 reversed an earlier loss to close the session up 1.05% and the Dow rose 0.02% at the closing bell.
European markets closed mixed on Wednesday as investors awaited the Fed’s latest interest rate decision which was released after the closing bell in Europe. Germany’s DAX added 0.35%, while the French CAC fell 0.07% and in the UK the FTSE100 fell 0.14%.
Investors expected the 25-basis point rate hike announced by the Fed overnight however will continue to monitor commentary around the decision to gain any insight into what other central banks around the world might do at their respective rate hike meetings over the coming days.
What to watch today:
- On the economic calendar today the Bank of England’s latest interest rate decision will be announced later tonight with the market expecting a 50-basis point rise to 4%.
- The SPI futures are anticipating the local market to open 0.31% higher buoyed by the strong session on Wall St overnight.
- On the commodities front, oil is trading 2.41% lower at US$76.97/barrel, gold is up 1.02% at US$1947.40/ounce and iron ore is down 0.77% at US$129/tonne.
- The Aussie dollar is buying 71 US cents, 91.83 Japanese yen, 57.01 British pence and 1 New Zealand dollar and 10 cents.
Trading Ideas:
- Bell Potter has upgraded its rating and price target on Gold Road Resources (ASX:GOR) to a buy rating and a price target of $1.95 following the release of the company’s fourth quarter results including a revaluation of the company’s listed investments. The company’s 50%-owned Gruyere mine is beginning to yield increasing cash flow and earnings as production expands to greater than 350 thousand ounces per annum. Gold Road Resources also has a 19.99% stake in De Grey Mining (ASX:DEG), owner of the Mallina Gold Project, where 8.5 million ounces of gold have been delineated at the Tier-1 ‘Hemi Mining Centre’.
- Trading Central has identified a bullish signal on The Lottery Corp (ASX:TLC) following the formation of a pattern over a period of 12-days which is roughly the same amount of time the share price may rise from the close of $4.86 to the range of $5.12 to $5.20 according to standard principles of technical analysis.
The ASX closed the midweek session at a nine-month high, ending the day up 0.33% as investors piled into real estate and materials stocks, while selling out of energy and technology stocks.
Head of economic analysis at the RBA Marion Kohler said inflation has peaked and will begin to ease over the course of this year. She said the RBA remains focused on returning inflation to the target range and establishing a more sustainable balance of demand and supply in the Australian economy.
Flight Centre (ASX:FLT) shares took flight today, closing the session up over 8% after successfully completing a $180m placement through the issue of 12.3 million new shares. The Placement was strongly supported by existing and new institutional investors with demand exceeding the Placement size. The proceeds from the placement will be used to fund the acquisition of a 100% interest in Luxury Travel Holdings to grow Flight Centre’s leisure presence in the US and UK luxury markets.
Credit Corp (ASX:CCP) kicked off earnings season today with a bang, as the company closed the day up almost 1% on the back of first half results including 32% growth in the consumer loan book, on track for record full year consumer lending segment earnings, and a significant step-up in US resourcing to meet the opportunity in the region. Credit Corp also reported a 30% decline in NPAT to $31.8m due to up-front loss provisioning and marketing expense from rapid loan book growth, costs arising from increased US resourcing and run-off in the core AU/NZ debt buying segment.
The winning stocks from today’s session were Flight Centre (ASX:FLT) adding over 8%, James Hardie Industries (ASX:JHX) climbing 4.3% and Imugene (ASX:IMU) rallying 3.7%.
And on the losing end Pinnacle Investment Management (ASX:PNI) fell 7.21%, Paladin Energy (ASX:PDN) lost 4.12% and Telix Pharmaceuticals (ASX:TLX) shed 3.7%.
The most traded stocks by Bell Direct clients today were CSL (ASX:CSL) , Beach Energy (ASX:BPT) and Rio Tinto (ASX:RIO).
On the commodities front, oil has risen to trade at US$ /barrel amid easing fears that the world’s largest oil user, the US, may face a recession on rising interest rates in the region. The price of oil is on watch ahead of the US Fed’s rate decision and production guidance from OPEC and its allies. Gold is trading, flat at US$1927/ounce and Iron ore is down 0.77% at US$129/tonne.
The Aussie dollar is buying 71 US cents, 91.90 Japanese Yen, 57.26 British Pence and 1 New Zealand dollar and 10 cents.
Investors globally will be awaiting the release of the Fed’s interest rate decision overnight with markets expecting a rise of just 25-basis points.
The US market closed higher on Tuesday following the release of upbeat earnings results and encouraging economic data. General Motors shares rose over 8% on Tuesday after reporting quarterly results that surprised markets including earnings per share of $2.12 and revenue of $43.11bn which both well exceeded analysts’ expectations. The Dow Jones rose 1.1%, the S&P500 gained 1.47% to record its best January since 2019, and the Nasdaq ended the day up 1.67% for its best January since 2001.
The Fed’s FOMC meeting ends today and has investors weighing up whether the fed will continue its aggressive rate hike strategy or whether recent favourable economic data will ease the fed’s stance including personal spending in the US falling by 0.2% for the second consecutive month in December, and US CPI showing goods and services prices have dropped for the first time since May 2020 as the inflation rate fell to 6.5% for December, down from 7.1% in November. The expectation is for a 25-basis point rate hike to be announced for the month, which is the lowest since March 2022.
Over in Europe, markets closed Tuesday’s session lower despite eurozone growth figures coming in ahead of estimates with growth of 0.1% in the last quarter of 2022. Investors in the region are now focused on the European Central Bank’s interest rate decision out on Thursday. German retail sales for December showed a surprise fall which paints a mixed picture of economic conditions in the region ahead of the rate decision out tomorrow. Germany’s DAX and the French CAC each closed Tuesday’s session flat, but the FTSE100 in the UK fell 0.17%.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open the midweek session 0.43% higher on the back of the strong session on Wall St on Tuesday.
- The Aussie dollar is buying US$0.70 US cents, 91.81 Japanese Yen, 56.91 British Pence and NZ$1.09.
- On the commodities front, oil is up 1.17% at US$78.81/barrel, gold is up 0.34% at US$1929/ounce and iron ore is up 4.42% at US$130/tonne.
Trading Ideas:
- Bell Potter has increased its price target on Aroa Biosurgery (ASX:ARX) from $1.40 to $1.45 and maintain a buy rating on the healthcare company following the release of the company’s third quarter trading update. For the quarter Aroa reported maintenance of revenue within the guidance range for FY23, and normalised EBITDA is expected to breakeven for FY23. Aroa also announced it has enrolled 138 out of 300 patients for its Myriad Registry. Bell Potter sees key catalysts from the report and Myriad Registry update are expected in the coming months and have increased the price target on Aroa as a result.
- Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 35-days which is roughly the same amount of time the share price may rise from the close of $6.63 to the range of $6.99 to $7.07 according to standard principles of technical analysis.
The local market recovered from the red start to the week in the early hours of trade on Tuesday before falling in afternoon trade to close 0.07% lower as investor optimism was initially boosted by weaker-than-expected retail sales before confidence was dampened by the fact that the lower retail sales will likely have low impact on the upcoming RBA interest rate decision next week. Consumer staples stocks led the market gains today while information tech stocks were sold off amid investor fears of prolonged interest rate hikes to come.
Retail sales for the month of December tumbled 3.9% to $34.47bn despite traditionally being the busiest month of the year for retailers. Department stores were the worst hit with a decline of 14.3%, while clothing, footwear and personal accessory retailing fell 13.1%. The decline in retail sales caused a sell-off in retail stocks like Myer Holdings (ASX:MYR), City Chic Collective (ASX:CCX) and Lovisa (ASX:LOV) today, however has investors now hoping the RBA will ease its rate hike stance at the next meeting next Tuesday.
Software defined networking company Megaport (ASX:MP1) tanked over 24% on Tuesday after releasing a quarterly update including cash from operations was $0.2m, down from Q1 with lower receipts from customers, total net cash flow of minus $11.9m which is a further dive from the minus $9.6m in the prior corresponding quarter, and the company burnt almost $50m in cash from the same period a year earlier to close the quarter with $57.5m in cash.
Infant formula producer Bubs Australia (ASX:BUB) crashed more than 9% yesterday after also releasing a Q2 trading update including group gross revenue down 28% on the PCP to $14.3m driven by gross revenue from the Chinese market down 66% for the quarter amid prolonged lockdowns in the region. International gross revenue for the quarter was strong, boosted by US shipments and the company recently making progress on its journey to gain permanent US regulatory approval.
The winning stocks from today’s session were led by Woolworths (ASX:WOW) jumping 3.77%, while Corporate Travel Management (ASX:CTD) added 2.7% and EVT (ASX:EVT) rose 2.55%. And on the losing end, Megaport (ASX:MP1) took the biggest hit today closing down almost 25%, Sayona Mining (ASX:SYA) fell just under 12% and Allkem (ASX:AKE) closed the day down 7.5%.
The most traded stocks by Bell Direct clients today were Winsome Resources (ASX:WR1), Whitehaven Coal (ASX:WHC) and Mineral Resources (ASX:MIN).
On the commodities front today, oil is down 0.32% at US$77.65/barrel amid rate hike decisions by central banks this week as well as Russian oil exports remaining strong. Gold is down 0.15% today at US$1919/ounce and iron ore is up 4.42% at US$130/tonne.
Further economic data released today included Chinese Manufacturing PMI for January coming in at 50.1 points which was above expectations and growth from December, indicating the Chinese economy is recovering faster than anticipated after the scrapping of the harsh COVID-19 lockdowns.
The Aussie dollar is buying US$0.70, 91.63 Japanese Yen, 57.31 British Pence, and NZ$1.09.
Ahead of the Federal Reserve’s rate decision, US equities closed in the red overnight, pausing the rally we’ve seen in Wall St. Investors are always preparing for the busiest week of the US earnings season.
The Dow Jones dropped 0.77%, the Nasdaq down 1.96% and the S&P500 down 1.3%. Communications services and information technology were among the biggest laggards in the S&P500, while mega-cap tech stocks such as Meta and Alphabet are down more than 2%.
Over in Europe, Germany’s DAX, France’s CAC and the STOXX 600 all closed in the red, while the FTSE gained 0.25%.
What to watch today:
- Ahead of the local trading day, The market is set to open slightly lower this morning, with the SPI futures suggesting a fall of 0.07%.
- In commodities, the price of oil has dropped 2.25% amid robust Russian exports and persistent fears of the global economic slowdown. Gold is trading just 0.2% lower, while iron ore is flat.
- There are a few companies set to release their quarterly reports today, including Beach Energy (ASX:BPT), Gold Road Resources (ASX:GOR), Megaport (ASX:MP1), Nickel Industries (ASX:NIC), PointsBet Holdings (ASX:PBH) and Syrah Resources (ASX:SYR).
Trading Ideas:
- Bell Potter maintain a BUY rating on Alkane Resources (ASX:ALK), an exploration, mining and investment company. The company is an established gold producer and maintains a multicommodity exploration portfolio.
- Trading Central has identified a bullish signal in Boss Energy (ASX:BOE), indicating that the stock price may rise from the close of $2.63 to the range of $2.82 to $2.88 over 36 days, according to the standard principles of technical analysis.
The ASX started the week in negative territory, closing the day down 0.16% as insurance companies weighed on the key index today. Insurance Australia Group (ASX:IAG) and Suncorp (ASX:SUN) each fell over 3% due to catastrophic flooding in New Zealand increasing investor fears of high insurance claim numbers to come for providers.
Technology stocks surged ahead more than 2% today amid the ongoing rally for growth stocks in the US and locally as investors regain appetite for higher risk growth stocks amid renewed hopes for a slowdown in aggressive rate hike action by the Fed and RBA.
OZ Minerals (ASX:OZL) shares bounced today as investors digested the mining giant’s trading update including the warning that the cost of producing South Australian copper could incur higher electricity costs moving forward. During the fourth quarter though, the company reported its highest ever group quarterly copper production on record and met guidance for FY22. The report comes at the same time the company is recommending its shareholders accept BHP’s $9.6bn takeover offer when they vote on the bid in early April.
Pro Medicus (ASX:PME) shares rose more than 1.3% today after the leading health imaging provider announced it has signed an 8-year contact with US-based Samaritan Health Services worth $12m for Pro Medicus’ US-based subsidiary, Visage Imaging to replace legacy PACS throughout the Samaritan Health Services network.
The winning stocks today were led by Core Lithium (ASX:CXO) rallying 8.85% after the company released quarterly results including additional night shift by the company’s contractor Primero Group to ensure construction of the Dense Media Separation plant remains on schedule for production of first spodumene concentrate in the first half of 2023. Novonix (ASX:NVX) added 7.5% today and Lynas Rare Earths (ASX:LYC) rallied just under 7% today. And on the losing end Champion Iron (ASX:CIA) fell 7.1%, ResMed (ASX:RMD) lost 6.81% and Insurance Australia Group (ASX:IAG) ended the day down 3.74%.
The most traded stocks by Bell Direct clients today were Core Lithium (ASX:CXO), Westpac Banking Corporation (ASX:WBC) and ResMed (ASX:RMD).
On the commodities front this afternoon, oil is trading 0.4% lower at US$79.38/barrel, gold is up 0.26% at US$1932/ounce and iron ore is flat at US$124.50/tonne.
The Aussie dollar is buying US$0.71, 91.84 Japanese Yen, 57 British Pence and NZ$1.09.
The local market ended the week 0.8% higher after gaining 0.34% on Friday, buoyed by a rally for consumer staples and information technology stocks. Energy stocks were sharply sold off on Friday, with the sector closing down 1.84% at the end of the session amid growing uncertainty from global recession fears and geopolitical tensions.
The winning stocks from Friday’s session were led by Megaport (ASX:MP1) jumping 7.22%, while Liontown Resources (ASX:LTR) added 5.2% and Karoon Energy (ASX:KAR) rose 4.3%. On the losing end, New Hope Corporation (ASX:NHC) tumbled over 9%, Whitehaven Coal (ASX:WHC) lost 6.64% and Regis Resources (ASX:RRL) fell over 4.8%.
The most traded stocks by Bell Direct clients on Friday were Pilbara Minerals (ASX:PLS), Core Lithium (ASX:CXO) and Bank of Queensland (ASX:BOQ).
Over in the US on Friday, stocks rallied to end the week higher boosted by a growth-sectors like technology as investor fears of the Fed continuing its aggressive rate hike stance, begin to ease on the back of favourable economic data including personal spending in the US falling by 0.2% for the second consecutive month in December.
What to watch today:
- The week ahead is a big week on the reporting season front for big tech companies like Meta, Alphabet and Apple. Following a turbulent year for beaten down technology stocks last year, investors are hoping for growth outlook this reporting season from the big tech giants, especially in the wake of mass lay-offs from the likes of Google in recent weeks.
- The Nasdaq added almost 1% on Friday while the Dow Jones rose 0.08% and the S&P500 jumped 0.25%.
- In Europe, markets closed marginally higher on Friday after US economic data came in stronger than expected on Thursday with the US economy expanding by 2.9% YoY during the fourth quarter, beating expectations and maintaining recession fears. Germany’s DAX rose 0.11%, the French CAC added 0.02% and the FTSE100 in the UK rose just 0.05%.
- Ahead of the local trading session, the SPI futures are anticipating the local market to open 0.16% higher to start the new trading week.
-
On the economic data front today, there is no local economic data out today, however investors will be awaiting the release of preliminary retail sales data for December in Australia which is out tomorrow.
- Taking a look at commodities, oil is trading down 1.64% at US$79.68/barrel, gold is down 0.05% at US$1927.97/ounce and iron ore is trading flat at US$124.50/tonne.
- The Aussie dollar is buying, 71 US cents, 92.12 Japanese Yen, 57.76 British Pence and 1 New Zealand dollar and 10 cents.
Trading Ideas:
- Trading Central has identified a bullish signal on Lake Resources (ASX:LKE) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may rise from the close of $0.82 to the range of $0.98 to $1.02 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Nufarm (ASX:NUF) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may fall from the close of $5.93 to the range of $5.58 to $5.64 according to standard principles of technical analysis.
Australia’s inflation rate data for the December quarter released today showed the country’s inflation rose to 7.8% for the twelve months to December 2022, or 1.9% for the quarter, which exceeded economists’ expectations, and adding to investor fears of further interest rate hikes to tackle the stubbornly high inflation. Travel and electricity contributed the largest price rises over the December quarter of 2023, while travel and building new homes contributed the largest price hikes over the 12-months.
Following the release of the data, the ASX sharply declined before steadily climbing in afternoon trade to close the day down 0.29% as a sell-off in energy stocks and info tech stocks weighed on the key index.
Company trading updates continue being released and included in today’s announcements were updates from Mineral Resources (ASX:MIN), St Barbara (ASX:SBM) and Best & Less (ASX:BST).
Mineral Resources (ASX:MIN) shares fell more than 2% today on the release of Q2 results including delays to the expansion of production capacity at the company’s Mt Marion lithium project due to delayed supply of processing equipment and labour shortages, which has caused FY23 shipment guidance to be reduced, and Free on Board (FOB) costs to be increased. Iron ore shipments for the quarter were also down 9% QoQ, while spodumene concentrate shipped in the quarter rose 18% and a total of 7418 tonnes of lithium hydroxide and lithium carbonate was converted, with 6612 tonnes sold during the quarter, up 75% QoQ.
Investors fled St Barbara (ASX:SBM) shares today, causing the gold miner’s share price to fall over 16% on the release of a Q2 trading update including gold production of 60,976 ounces at an All-in-sustaining-cost of $2666/ounce which implies lower production and higher costs quarter on quarter.
Best & Less (ASX:BST) shares were also caught up in the trading update related sell-off today after the value retailer released an update for the 26-weeks ended January 1, 2023, including total revenue up 13% on the PCP, however like-for-like sales were down 4.9%, online sales were down 29.8% and NPAT down 31.8% on the prior first half to $13.7m.
The winning stocks from today’s session were News Corp (ASX:NWS) rallying 6.25%, Monadelphous (ASX:MND) adding 5.38% and IPH (ASX:IPH) jumping over 4%. And on the losing end West African Resources (ASX:WAF) took the biggest hit, falling almost 7.5%, while Evolution Mining (ASX:EVN) losing 5.9% and Ramelius Resources (ASX:RMS) ending the day down almost 5%.
The most traded stocks by Bell Direct clients were Core Lithium (ASX:CXO), Sierra Rutile (ASX:SRX), and Vanguard Australian Shares Index ETF (ASX:VAS).
Taking a look at commodities this afternoon, oil has steadied today as investors weigh demand recovery hopes from the world’s top crude importer China, against fears of a global economic slowdown. Oil is trading at US$80.33/barrel this afternoon. Gold is down 0.31% at US$1931.56/ounce and iron ore is flat at US$124.50/tonne.
The Aussie dollar is buying US$0.71, 92.61 Japanese Yen, 57.12 British Pence, NZ$1.09.
There will be no weekly wrap this week due to the January public holiday. We will return to normal scheduling from Monday 30th January.
The US markets turned from negative to positive in afternoon trade before closing mixed as investors digested an array of economic data released. US flash PMI data from US business activity across manufacturing and services remained below par, indicating the impact of tightening financial conditions on growth and adding to hopes that the Fed is on track to ease its aggressive rate hike stance soon. The Dow Jones closed 0.4% higher, the S&P500 closed flat and the Nasdaq fell just 0.1%.
Retail company Bed Bath and Beyond jumped over 13% on Tuesday as investors continue piling into the heavily shorted company despite the company warning of a potential bankruptcy.
General Electric rallied over 1% after posting quarterly results that topped expectations amid the company working through a multi-year program to cut debt and simplify its operations.
Over in Europe, markets closed mixed despite PMI data in the region showing services and manufacturing sectors in the eurozone returned to modest growth in December, boosting hopes that the 20-member currency bloc may avoid recession. The stronger-than-expected PMI data reinforced expectations that the European Central Bank will maintain its aggressive stance against inflation at the upcoming meeting on the 2nd February. The PMI data also boosted business confidence which rose the most since the aftermath of the COVID-19 outbreak despite high inflation and rising borrowing costs. The STOXX600 fell 0.2% driven by losses in healthcare, oil and gas stocks, while Germany’s DAX fell 0.07%, the French CAC rallied 0.26% and the FTSE100 in the UK fell 0.35%.
Swiss watchmaker Swatch Group shares rose more than 5% on Tuesday after the company reported a 2.5% increase in 2022 sales and said it was positive about recovery especially in the Chinese market.
On the commodities front, oil is trading 1.53% lower at US$80.35/barrel, gold is up 0.15% at US$1934/ounce, and iron ore is flat at US$124.5/tonne.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open the midweek session 0.22% lower despite the afternoon rally on Wall St.
- The Aussie dollar is buying 70 US cents, 91.57 Japanese Yen, 56.71 British pence and 1 New Zealand Dollar and 8 cents.
- On the economic calendar today, the highly anticipated inflation rate data for Australia in the fourth quarter will be released at 11:30am AEDT with the market expecting a rise to 7.6% Year on Year from 7.3% in Q3.
Trading Ideas:
- Trading Central has identified a bullish signal on Galan Lithium (ASX:GLN) following the formation of a pattern over a period of 33-days which is roughly the same amount of time the share price may rise from the close of $1.23 to the range of $1.47 to $1.53 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Breville Group (ASX:BRG) following the formation of a pattern over a period of 112-days which is roughly the same amount of time the share price may rise form the close of $22.39 to the range of $25.10 to $26 according to standard principles of technical analysis.
The ASX extended its green run into Tuesday, adding 0.44% at the closing bell driven by a surge in real estate and technology stocks. Lithium stocks took flight today after UBS raised its rating on a number of key players including upgrading Pilbara Minerals (ASX:PLS) to Neutral, upgrading Mineral Resources (ASX:MIN) to Buy and upgrading lithium price outlook amid China’s reopening.
Cooper Energy (ASX:COE) shares came under pressure today after the oil and gas company released a Q2 update including revenues down 17% due to lower production especially at its Orbost gas processing plant and lower average gas prices.
Zip shares plunged more than 9% today after the buy now, pay later company released a Q2. Despite reporting a record quarter with record quarterly transaction volume up 22% to $2.7bn, record group quarterly revenue of $188m, record transaction numbers up 15% and cash transaction margin lifting 2.6%. For the first time, the company’s US operations delivered positive cash EBTDA in November and December. The company may have had a record quarter, but it still continues to burn through cash with available cash and liquidity falling almost 50% to $78.7m from the prior quarter.
Retail giant Myer (ASX:MYR) rallied more than 4% today after also releasing a trading update including sales growing 24.8% in the five months ended December 31, which is the best sales on record for the first five months, according to CEO John King.
The winning stocks from today’s session were Breville Group (ASX:BRG) adding over 7.5%, Block Inc (ASX:SQ2) rallying 5.7% and Mineral Resources (ASX:MIN) lifting 5.3%. And on the losing end Telix Pharmaceuticals (ASX:TLX) fell 3.45%, Imugene (ASX:IMU) lost 3.23% and Cochlear (ASX:COH) fell 2.53%.
The most traded stocks by Bell Direct clients today were BHP Group (ASX:BHP), Mineral Resources (ASX:MIN) and IGO (ASX:IGO).
On the economic data front today, NAB Business Confidence data for December was released today and came in at -1 point for the holiday month, which was the third consecutive decline but moderately higher than the 4-point drop in November, as pricing pressure began to ease hinting toward a likely peak in inflation.
Taking a look at commodities, oil is trading 0.25% higher at US$81.81/barrel, gold is slightly higher at US$1932/ounce, and iron ore is flat at US$124.50/tonne.
The Aussie dollar is buying US$0.70 US cents, 91.51 Japanese Yen, 56.81 British pence and NZ$1.08.
The US Market rallied to start the week, led by the tech-heavy Nasdaq jumping more than 2% as investors weigh the Fed’s rate path moving forward in favour of a slowdown in rate hikes to come. Favourable economic data released last week showed a decline in wholesale and retail sales in a sign consumer spending is also starting to cool. The Dow Jones added 0.76% to start the week and the S&P500 rallied 1.19%. Semiconductor shares, as well as Apple and Tesla shares all climbed on Monday amid hopes that the reopening of China would stimulate business for these tech companies.
In Europe, markets started the week on a positive note as investors globally increasingly believe the Federal Reserve is ready to slow its rate hike pace amid signs of cooling growth in the US economy. Company earnings reports out in Europe also made waves yesterday with German fragrance and flavouring producer Symrise tumbling 7% after missing full year earnings expectations, while French liquor company Remy Cointreau shares rose 3% after Citigroup raised its rating from neutral to buy and raised its price target on the company.
Germany’s DAX closed almost half a percent higher on Monday, while the French CAC added 0.52% and in the UK, the FTSE100 rose 0.18%.
What to watch today:
- Ahead of the local trading session, the SPI futures are expecting the ASX to open 0.31% higher on the back of a strong session on Wall St overnight.
- On the commodities front, oil is trading just 0.05% lower at US$81.59/barrel, gold is up 0.12% at US$1928.88/ounce, and iron ore is flat at US$124.50/tonne.
- The Aussie dollar is buying US$0.70 US cents, 91.81 Japanese yen, 56.52 British pence, and NZ$1.08.
- On the economic calendar today, NAB business confidence data for December is released with consensus expecting a rise of 3 points to -1 points for the month, after a fall of 4 points in November.
Trading Ideas:
- Bell Potter has downgraded its price target on Allkem (ASX:AKE) from $19.45 to $19.36 but maintains a buy rating on the lithium company following the release of Q2 results. Bell Potter sees despite a record quarter at the company’s flagship Olaroz operations, the Mt Cattlin project December quarter production of spodumene concentrate fell short of Bell Potter expectations and costs exceeded expectations. Bell Potter sees Allkem is through the worst at Mt Cattlin but expects an ambitious recovery in the second half of the financial year.
- Trading Central has identified a bullish signal on Ardent Leisure Group (ASX:ALG) following the formation of a pattern over a period of 61-days which is roughly the same amount of time the share price may rise from the close of $0.61 to the range of $0.74 to $0.78 according to standard principles of technical analysis.
The ASX seesawed throughout the first trading session of the week before closing just 0.07% higher as strong gains in the tech and energy sectors offset losses in the utilities sector.
Pilbara Minerals (ASX:PLS) dominated the market gains again after releasing a production update last week including production and revenue coming in ahead of analysts’ expectations, which also prompted Morgans to reiterate their add rating on PLS with an improved price target of $5.40, announced today.
Australian based, international oil and gas exploration and production company Karoon Energy also soared over 7% today after announcing an updated assessment of reserves and resources at its 100% owned Santos Basin concession, BM-S-40 in Brazil, where the revised assessment has found better-than-expected performance at the existing wells. Proved and Probable reserves also increased 23% compared to 30 June 2022.
Food price inflation at Australia’s two largest supermarkets rose to an average of 9.2% across the December quarter, from an average of 8.2% in the September quarter according to UBS. The fresh food category had the steepest food inflation, led by the dairy and meat sector.
The winning stocks from today’s session were led by Karoon Energy (ASX:KAR) rallying over 7.41%, Liontown Resources (ASX:LTR) recovering from last week’s sell-off to climb 6.91% and Pilbara Minerals (ASX:PLS) lifted 6.15%.
And on the losing end, Fisher and Paykel Healthcare (ASX:FPH) fell 2.84%, Adbri (ASX:ABC) lost 2.72% and Chalice Mining (ASX:CHN) shed 2.52% to start the week.
The most traded stocks by Bell Direct clients were Woodside Energy (ASX:WDS), Core Lithium (ASX:CXO) and Allkem (ASX:AKE).
On the economic calendar front today, the Bank of Japan’s meeting minutes were released giving insight into the policy meeting that resulted in the surprise no change to the country’s easy monetary policy.
On the commodities front today, oil has dipped 0.4% to US$81.32/barrel due to the Lunar New Year holiday in Asia but outlook is still favourable for strong demand in 2023 as China, the world’s largest importer of oil, reopens. Coal is down 3.45% at US$350.95/ton, gold is up slightly at US$1927/ounce, and iron ore is flat at US$124.50/tonne.
The Aussie dollar is buying 70 US cents, 90.57 Japanese Yen, 56 British Pence, and 1 New Zealand dollar and 8 cents.
The local market ended last week on a 0.23% gain at the closing bell of Friday’s session, driven by a surge in energy and materials stocks on the back of rising commodity prices. Communication services and consumer discretionary stocks came under pressure to close in the red on the last trading session of the week.
Quarterly reports and company trading updates continued dominating market movements last week both locally and overseas and are expected to continue doing so for at least the next few weeks as investors respond to company performance amid challenging market conditions especially in this rising interest rate environment.
The winning stocks from Friday’s session were Pilbara Minerals rising 13% on the back of a strong trading update including a 10% increase in delivered spodumene concentrate on the prior quarter. Whitehaven Coal rallied over 6% on Friday and Fisher and Paykel Healthcare added 4.87% to end the week.
On the losing end, Liontown Resources tumbled over 8%, while Nanosonics fell 6.64% and Pinnacle Investment Management lost 3.76%.
The most traded stocks by Bell Direct clients on Friday were Whitehaven Coal, Rio Tinto and Terracom.
Over in the US on Friday, tech shares led the broad market rally as investors responded to some positive corporate news including Google’s parent company Alphabet cutting 12,000 staff to cut costs as growth in the business slows, which prompted a 5% surge in Alphabet’s share price. Netflix also surged on better-than-expect subscriber data announced in the company’s latest results update. The Nasdaq jumped 2.7%, the Dow Jones added 1% and the S&P500 rallied 1.9% on Friday.
Investors are keeping a close eye on any news around the Fed’s upcoming interest rate meeting from January 31 to February 1 where it is expected the Fed will ease its current aggressive stance on rate hikes to increase the nations’ cash rate by 25-basis points amid signs the economy is beginning to cool.
Markets in Europe rebounded from Thursday’s sell-off driven by weaker-than-expected retail sales out of the US, to close higher on Friday as investors in the region also keep a firm eye on updates out of the Fed ahead of the next policy meeting. Germany’s DAX added 0.76%, the French CAC rallied 0.63% and in the UK, the FTSE100 rose 0.3%.
What to watch today:
- Ahead of the local trading session, the SPI futures is anticipating the ASX to open 0.46% higher, buoyed by the strong session on Wall Street on Friday.
- On the economic data front today, the Bank of Japan policy meeting minutes will be released, which will give investors an insight into the rate outlook in the region following the shock maintenance of the country’s extremely low interest rate of -0.1% at the last policy meeting.
- Taking a look at commodities, oil is trading higher at US$81.64/barrel, gold is down almost 1% at US$1913/ounce and iron ore is flat at US$124.50/tonne.
- The Aussie Dollar is buying US$070, 90.25 Japanese Yen, 56.19 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter maintain a BUY rating on IVE Group (ASX:IGL), and while there is no change in forecasts, Bell Potter have updated each valuation used in the determination of our price target for market movements and time creep. The price target has increased from $2.60 to $2.75, and at IGL’s current share price of $2.37, this implies 16% share price growth in a year.
- Trading Central have identified a bullish signal in Pilbara Minerals (ASX:PLS) indicating that the stock price may rise from the close of $4.55 to the range of $4.80 to $4.90 over 26 days according to the standard principles of technical analysis.
US markets fell again on Thursday for a third straight session as investors are increasingly concerned that the Fed will continue raising interest rates despite signs the economy is beginning to cool. The increasing concerns follow new jobless claims in the US hitting the lowest level since June last week in a sign the labour market remains resilient despite the slowing economy. The Dow Jones and S&P500 each fell 0.76%, while the Nasdaq closed the day down 0.96%. US investors continue eyeing off corporate earnings results which today will be released by Netflix after the bell with analysts’ expecting EPS of $0.45/share, a decline of 66.3% from the prior corresponding period, and a modest gain of 1.8% in revenue to US$7.85bn. Shares in the streaming giant fell 3.23% on Thursday ahead of the results being released. JPMorgan Strategist Marko Kolanovic said a recession hasn’t been priced into equities just yet, meaning stocks could have further downside from their current positions. He said ‘US industrials and non-tech large caps (Dow Jones) as well as European stocks are basically flat over the past year, and close to previous highs’.
Over in Europe, markets closed lower on Thursday as investor fears of a global recession continue to weigh on sentiment, especially on the outlook front which is an item high up on the agenda at this week’s World Economic Forum in Davos.
The STOXX600 closed down 1.6%, Germany’s DAX fell 1.72%, the French CAC lost 1.86% and in the UK, the FTSE100 closed the day down 1.07%.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the local market to open 0.01% lower following the turbulent session on Wall St overnight.
- On the commodities front, oil is trading 1.21% higher at US$80.44/barrel, gold is up 1.60% at US$1934/ounce, and iron ore is trading more than 2% higher at US$123/tonne.
- In economic data, Japan’s inflation rate data for December will be released at 10:30am AEDT with consensus expecting inflation to rise 0.2% to 4% for the month.
- The Aussie dollar is buying US$0.69, 88.82 Japanese yen, 55.73 British pence and NZ$1.08.
Trading Ideas:
- Trading Central has identified a bullish signal on Bubs Australia (ASX:BUB) following the formation of a pattern over a period of 39-days which is roughly the same amount of time the share price may rise from the close of $0.34 to the range of $0.38-$0.40 according to standard principles of technical analysis.
- Trading Central has identified a bullish signal on BCI Minerals (ASX:BCI) following the formation of a pattern over a period of 143 days which is roughly the same amount of time the share price may rise from the close of $0.29 to the range of $0.33-$0.35 according to standard principles of technical analysis.
The local market took no lead from Wall St overnight, closing Thursday’s session 0.57% higher on the release of softer than expected jobs data out for December. Materials stocks led the gains today, as investors piled back into the sector following a few sessions of selling out earlier in the week, while tech stocks were sold off today.
In economic data out today, Australia’s jobs data for December was revealed and was vastly different to the figures economists were expecting. For the month, Australia’s economy lost 14,644 jobs and the unemployment rate rose to 3.5%, compared to the expected plateau of 3.4% jobless rate and the adding of 22,500 jobs. The softer-than-expected jobs data fuelled the rally locally today as interest rate hike fears cooled and economies begin showing signs of slowing down globally.
Nanosonics (ASX:NAN) soared 8% today after releasing a first half trading update including total revenue increasing 35% YoY to $81.6m, gross profit up 39% to $64.4m and global installed base rose to 31,120 units. The company is starting to see benefits of its recent sales model switch in the US to an in-house model from a distributor model. Netwealth (ASX:NWL) shares on the other hand were sharply sold off today after the company released a quarterly update including a significant slowdown in net inflows, down 42% on the PCP to $$2.087bn.
The winning stocks for today were led by Nanosonics (ASX:NAN) rallying over 8%, Viva Energy (ASX:VEA) adding 4.74% and Pexa Group (ASX:PXA) lifting 3.77%. And on the losing end of the market, Netwealth Group (ASX:NWL) fell 9.19%, Novonix (ASX:NVX) lost 7.27% and Alumina (ASX:AWC) shed 6.76%.
The most traded stocks by Bell Direct clients today were Rio Tinto (ASX:RIO), BHP Group (ASX:BHP) and Allkem (ASX:AKE).
Oil has taken a hit today on increased recession fears following disappointing US retail data for December showing US retail sales declined more than expected and producer prices fell the most since April 2020. As a result of the renewed recession fears, oil traded at US$79/barrel today. Iron ore is trading 2.07% higher at US$123/tonne and gold has also rebounded to trade 0.35% higher at US$1910.34/ounce.
The Aussie dollar is buying US$0.69, 88.38 Japanese Yen, 56.51 British Pence and NZ$1.08.
Disappointing retail sales data released in the US overnight saw Wall Street close in the red. The Dow Jones tumbled 1.8%, as investors took their profits from the strong start to the year. The S&P500 lost 1.6% and the Nasdaq down 1.2%
European markets were mixed as uncertainty persisted on the economic outlook, which is a key topic of debate on the agenda at the World Economic Forum in Davos this week. The STOXX 600 gained 0.2% and France’s CAC up 1%, while Germany’s DAX closed flat and the FTSE100 closed 0.3% lower.
What to watch today:
- The SPI futures are suggesting the Australian market will drop 0.42% at the open this morning.
- BHP (ASX:BHP)’s share price will be on watch today, with the mining giant set to releasee its second quarter production update.
- In commodities, oil is more than 1% in the red, at levels last seen in early December. Gold is trading higher at around US$1,903 per ounce, while iron ore is down to US$120.50 per tonne, dropping from the seven-month high of US$127 touched in the previous session.
- In economic data, at 11:30am AEDT the unemployment rate for December will be announced, expected to remain unchanged at 3.4%.
Trading Ideas:
- Bell Potter maintains a BUY rating on Allkem (ASX:AKE) and have lowered their price target from $19.45 to $19.36. At AKE’s current share price of $12.25, this implies 58% share price growth in a year.
- Trading Central have identified a bullish signal in Ampol (ASX:ALD), indicating that the stock price may rise from the close of $29.32 to the range $31.30 - $31.80, over 61 days according to the standard principles of technical analysis.
The ASX had another lacklustre session today closing the day up just 0.1% as investors continued to sell off materials and utilities stocks, while piling into technology and healthcare stocks.
Allkem (ASX:AKE) shares dipped today after the lithium producer released a December quarter trading updating including record sales revenue of US$151m from the company’s flagship Olaroz operation despite softer sales units, and revenue of US$83 million from the Mt Cattlin operation. The company’s Naraha project also successfully achieved first production of lithium hydroxide and the product quality exceeded expectations. AKE shares were caught up in the lithium stock sell-off in recent days though as demand outlook for EVs has been dampened by Tesla’s price reductions and lithium price outlook reports. Ampol (ASX:ALD) shares rallied today after the petroleum company released fourth quarter results including the Lytton Refiner Margin remaining above historical levels averaging US$11.75 per barrel, while refinery production rose to 1580 ML, from 1546 ML in the third quarter including planned maintenance activities. Qantas (ASX:QAN) shares dipped in afternoon trade following the issue of a mayday call on QF144 from Auckland to Sydney just after 2pm today. The plane landed safely just after 3pm despite issuing the mayday call amid engine issues. Qantas shares rebounded in the last hour of trade after the plane landed safely to close the day up 0.76%.
The winning stocks from today’s session were, led by Sayona Mining (ASX:SYA) jumping almost 9% despite no price sensitive news out of the company today, while Telix Pharmaceuticals (ASX:TLX) rose 8.6% and Block Inc (ASX:SQ2) jumped 4.57% today. The stocks that weighed on the market today included Hub24 (ASX:HUB) falling 4.8% a day after the company provided quarterly results, Gold Road Resources (ASX:GOR) losing 4.56% and Capricorn Metals (ASX:CMM) shedding 4.53%.
The most traded stocks by Bell Direct clients today were St Barbara (ASX:SBM), Macquarie Group (ASX:MQG) and Telstra (ASX:TLS).
On the economic calendar today, the Bank of Japan maintained the country’s short-term interest rate at -0.1% after 8-years of no change, despite recent signs indicating an increase in the rate may be imminent.
Taking a look at commodities, oil is trading almost 1% higher at US$80.79/barrel, gold is down almost half a percent at US$1899/ounce and iron ore is trading -0.82% lower at US$120.50/tonne.
The Aussie dollar is buying US$0.70, 91.86 Japanese Yen – boosted higher by the Bank of Japan not raising interest rates today, 56.9 British Pence and NZ$1.08.
Wall Street closed mixed on Tuesday which was the first trading session of the week in the US as investors digested contrasting earnings results out of investment banks Goldman Sachs and Morgan Stanley, as well as GDP data out of China indicating a rise of just 3% in 2022, which fell short of Beijing’s target of 5.5%. The Dow Jones closed 1.14% lower, the S&P500 fell 0.2% but the tech-heavy Nasdaq closed the day up 0.14% Goldman Sachs fell 6% after releasing fourth quarter and full year results that fell short of analysts’ expectations including EPS of US$3.32 per share compared with the expected US$5.48/share, revenue of US$10.59 billion compared to the US$10.83 billion estimate, and profits fell by two-thirds in the final three months of last year. Meanwhile, Morgan Stanley shares rose 6% after the investment bank also released fourth quarter and full year results including net income of US$2.11 billion or US$1.26/share which topped analysts’ estimates of EPS at US$1.19/share. The bank also announced cost cutting measures in December last year through reducing its staff by 2% and boosted its safety net by setting aside US$85 million for credit losses compared with just US$5 million in the same quarter a year earlier amid rising interest rates in the US.
Over in Europe markets were relatively unchanged on Tuesday as investor concerns are focused on the World Economic Forum in Davos this week. The STOXX600 closed 0.3% higher, Germany’s DAX rose 0.35%, the French CAC added 0.48% and, in the UK, the FTSE100 fell 0.12%.
On the commodities front, crude oil is up 1.27% at US$79.71/barrel, gold is down 0.63% at US$1905.86/ounce, and iron ore is down 4.33% at US$121.50/tonne.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures are anticipating the ASX to open the midweek session 0.29% higher.
- Important economic data out today includes the highly anticipated Bank of Japan interest rate decision, with the market expecting the maintenance of the economy’s -0.1% interest rate however recent indications may spell a surprise increase for the first time in 8-years.
- The Aussie dollar is buying, US$0.70, 89.51 Japanese Yen, 57.14 British Pence, and NZ$1.09.
Trading Ideas:
- Bell Potter has upgraded its price target on DroneShield (ASX:DRO) to $0.34/share following the aerial tech company announcing another new contract to kick off the new year. The $11m contract is a purchase order for several different types of the company’s counter-drone/C-UAS equipment. This is the second $10m+ contract announced by the company in less than 3-weeks, after the initial record contract of the same size in December’22, which establishes solid revenue foundation for CY23.
- Trading Central has identified a bullish signal on Goodman Group (ASX:GMG) following the formation of a pattern over a period of 172-days which is roughly the same amount of time the share price may rise from the close of $19.05 to the range of $23.75-$24.75 according to standard principles of technical analysis.
The local market’s green run came to an end today in a muted session as the key index closed just 0.03% lower. A sharp sell-off in materials and utilities stocks offset strong gains among consumer staples and healthcare stocks today. As recession fears increasingly dominate market sentiment, sectors like consumer staples and health care are remaining resilient as these companies traditionally remain strong during a recessionary environment.
Tech retail specialist JB Hi-Fi (ASX:JBH) released Q2 sales results and preliminary half year 2023 results including record sales of $5.28 billion and record earnings of $479.2 million for HY23. The strong performance follows continued elevated consumer demand and operating conditions starting to normalise following two-years of COVID related disruptions. Shares in JB Hi-Fi rallied in morning trade before retreating amid the broader market sell-off today.
Hub24 (ASX:HUB) shares were sold off on Tuesday after the wealth management technology firm released a Q2 update including net inflows for the quarter broadly flat on Q1 but dropping 23.6% to $5.8 billion from record inflows achieved in Q2 of FY22, and down 13.6% for the first half of FY23.
The winning stocks from today’s session were Novonix (ASX:NVX) adding 5.5%, Metcash (ASX:MTS) jumping 2.74% and Johns Lyng Group (ASX:JLG) rallying 2.71%. And on the losing end of the market Imugene (ASX:IMU) tumbling 5.88%, while Capricorn Metals (ASX:CMM) and Regis Resources (ASX:RRL) each fell 5.6 and 4.8% respectively.
The most traded stocks by Bell Direct clients today were ANZ (ASX:ANZ), Macquarie Group (ASX:MQG) and Telstra Group (ASX:TLS).
On the commodities front, oil is trading lower again around US$79/barrel as recession fears continue dominating global market sentiment, while iron ore is also trading sharply lower by more than 4% at US$121.50/tonne as China attempts to cool demand outlook of the commodity. Gold is also down almost 0.4% today at US$1910.58/ounce and coal is only slightly lower at US$370/tonne. Goldman Sachs researchers have said commodities have the strongest outlook of any asset class in 2023 given the perfect macroeconomic environment with critically low inventories for almost every key raw material against surging demand. The year has started with a pullback in prices due to warm weather shock and rising interest rates, however with China coming back online, the yearly outlook for commodity prices is looking up.
Westpac Consumer Confidence data released today showed Aussie confidence rose 5% to 84.3 points for January, which well exceeded market forecasts of a 2.3% decline.
The Australian dollar is buying US$0.70, 89.75 Japanese Yen, 57 British Pence, and NZ$1.09.
US markets were closed for the Martin Luther King holiday, but coming up this week in the US are Q4 earnings results, with Netflix and State Street announcing results Thursday and Friday.
European equities mostly ended their start to the week with modest gains. A key focus for European markets this week is the World Economic Focus in Switzerland, where the heads of state, business leaders and academics debate and discuss certain topics. The key themes this week are the war in Ukraine, economic uncertainty and climate change.
And we’re seeing defensive sectors under-performing around the world so far in 2023, notably healthcare and utilities. Australian utilities are more than 6% behind.
What to watch today:
- Despite the positive run overnight, the SPI futures are suggesting the Australian market will drop 0.29% at the open this morning.
- Super Retail (ASX:SUL)’s share price may continue to advance today after yesterday’s rally off the back of a strong update, with Goldman Sachs reiterating a buy rating on the stock with an improved price target of $14.20.
- Watch HUB24 (ASX:HUB), scheduled for a market update, and Rio Tinto (ASX:RIO) set to announce a quarterly production update.
- Katana Capital (ASX:KAT) and Tower (ASX:TWR) are set to go ex-dividend today.
- In commodities,
- The oil price has dropped, after advancing 8% last week, as China’s reopening from COVID curbs raised hopes for a boost in economic activity, with analysts forecasting that oil demand in China will likely hit a record this year.
- Gold is currently trading slightly in the red, however is hovering at its strongest levels in nearly nine months.
- And iron ore has jumped more than 2.4% higher to US$127 per tonne, the highest since mid-June, due to continued optimism about demand prospects in China and weakening supply concerns.
- In economic data, at 10:30am AEDT Westpac will release its data on consumer confidence.
Trading Ideas:
- Bell Potter maintain a BUY rating on Janus Henderson (ASX:JHG), ahead of the release of the company’s full year results for 2022, which will be out on the 2nd of February. Bell Potter have slightly upgraded their FY22 funds under management forecast to $279 billion from $263.5 billion previously. As a result, EPS is 0.6% higher for FY22, 5.5% higher for FY23 and 5.6% higher for FY24. EBITDA is also 0.6% higher in FY22, and 5.6% and 5.5% higher in FY23 and 24 respectively. Their dividend forecast in Australian dollars has increased, reflecting the currency movements applied to a US dollar dividend. Bell Potter have lowered their price target from $45.37 to $43.81, and at JHG’s current share price of $38.27, this implies 14.5% share price growth in a year.
- Trading Central have identified a bullish signal in BetMakers Technology Group (ASX:BET) indicating that the stock price may rise from the close of $0.29 to the range of $0.33 to $0.35 over 44 days, according to the standard principles of technical analysis.
The ASX extended last week’s green run into the new week with the key index closing the first trading session of the week up 0.82%, buoyed by a surge in technology and energy stocks today.
Tyro Payments (ASX:TYR) made waves today, jumping more than 8% after the fintech company announced an unaudited first half trading update including group revenue up 45%, payments transaction value up 37% and payments normalised gross profit rose 36%. These results indicate a turn-around in company performance after turbulence faced in 2022. Biotech company PolyNovo (ASX:PNV) also released a first half trading update today including record sales of $27.3 million for the first half of the 2023 financial year, up 67.5% on the prior corresponding period. This record result was driven by record sales in the US of $22.8 million.
Reformed commercial airline, Virgin Australia (ASX:VAH) may soon take its competitive edge to the ASX after Bain Capital, the firm which rescued Virgin Australia from voluntary administration back in 2020, said it will soon seek advice on an initial public offering. Investors will also be pleased with the first-half results preview released by Super Retail Group (ASX:SUL) today, the parent company of Supercheap Auto, Rebel Sport, BCF and more, after the company released record first-half sales performance.
Sector wise today, tech stocks led the rally, with the sector closing the session up 1.81%, while every other sector also closed Monday’s session in the green.
The winning stocks today were led by Super Retail Group (ASX:SUL) jumping 7.68%, Megaport (ASX:MP1) adding 7.46% and Imugene (ASX:IMU) rallying 6.25%. And on the losing end of the market, Core Lithium (ASX:CXO) tumbled 6.17%, Liontown Resources (ASX:LTR) lost 3.85% and Monadelphous Group (ASX:MND) fell 3.76%.
The most traded stocks by Bell Direct clients were the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ), Westpac Banking Corporation (ASX:WBC) and BHP Group (ASX:BHP).
Taking a look at commodities, oil has retreated from last week’s rally, steadying just above US$79/barrel as investors weighed improving demand outlook from China, against the rising prospect of a global recession. Gold continues to rally, trading 0.26% higher at US$1925/ounce while iron ore is trading lower amid China’s latest attempt to dampen positive outlook for demand of the commodity.
The Aussie dollar is buying US$0.70, 89.24 Japanese Yen, 57.11 British Pence and NZ$1.09.
Australia’s building permits data for November released today showed a decline of 9% for the month which was in-line with market expectations.
Complete the survey here: https://www.belldirect.com.au/smarter/2022-viewer-survey-feedback-page-youtube
We’re taking a short break over the holiday period and we are very excited to debut our brand new studio in 2023.
In 2023, we want to continue to provide you with useful and interesting investment market commentary, to help you stay across the Aussie and global share markets, and to help you build an even better investment portfolio.
We’d appreciate if you could please complete a short survey and provide your feedback on our market commentary videos.
Thank you in advance for your participation and thank you for being part of our audience in 2022.
Your responses will be anonymous and used only to help inform us on the content we should be delivering to you in 2023.
The Aussie share market lost 0.12% this week (Mon-Thu), and in a tough year for investors, the ASX200 is trading 5.71% lower (YTD). All eyes will be on inflation, rates and energy prices in 2023.
In this week's wrap, Grady covers:
- (0:18) M&As, the big banks & the data breaches in 2022
- (1:37) How commodity prices rocked this year
- (2:07) What's in store for the year ahead
- (3:47) The best performing stocks in the ASX200
- (5:32) The most traded stocks & ETFs by Bell Direct clients
- (6:00) Four economic news items to watch out for
US equities sharply fell overnight. The selling began after the Federal Reserve’s 50 basis point interest rate hike yesterday, taking the main rate 4.25% to 4.5% range. The shift to a lower gear following four consecutive 75 basis point hikes was widely anticipated, and bond yields barely moved in response. Overnight, US retail sales data was released – retail sales declined more than expected in November which heightened concerns around rate hikes, with the data showing that inflation has taken a toll on consumers. The Dow Jones saw its worst day in three months, falling more than 700 points or 2.25%, the S&P500 dropped 2.5% and the Nasdaq dropped 3.2%.
European markets also closed in the red after the European Central Bank signalled that “significant” rate increases are still to come. The STOXX 600 down 2.85%, Germany’s DAX and France’s CAC both closed more than 3% lower, and the FTSE 100 down 0.9%.
What to watch today:
- The SPI futures are suggesting the Australian market will fall 1.16% at the open this morning.
- In economic data, this morning the S&P Global Manufacturing and Services Flash PMI will be released. Remember the Flash PMI is a forward-looking estimate of the final PMI, set to be released next week.
- In commodities, the price of oil has dropped 1.4%, currently trading just over US$76 per barrel, as Chinese factory data piled onto demand concerns. Gold has dropped 1.7% to US$1,776 an ounce, while iron ore is down 0.5% at US$110.
- Keep watch of NAB and Link Administration (ASX:LNK) – both companies are set to hold their AGMs today.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Arafura Rare Earths (ASX:ARU) and have increased their valuation from $0.64 to $0.70. At its currently share price of $0.52 this implies 36% share price growth in a year.
- Trading Central has identified a bullish signal in Qualitas (ASX:QAL) indicating that the stock price may rise from the close of $2.28 to the range of $2.70 to $2.76 over 37 days, according to the standard principles of technical analysis.
The local market followed in Wall Street’s footsteps, with the key index closing Thursday’s session 0.64% lower as 8 of the 11 sectors closed the day in the red. A sharp sell-off in materials stocks weighed on the market today following strong than expected unemployment data out in Australia and the US Fed’s raising America’s cash rate by 50-basis points. Consumer staples stocks outperformed the market today as investors shifted into sectors that perform well during a high interest rate, recessionary environment.
The winning stocks today were led by Blackmores (ASX:BKL) lifting almost 8% despite no price sensitive news out of the company today, while New Hope Corporation (ASX:NHC) added 4.66% and Whitehaven Coal (ASX:WHC) added 3.9% today. And on the losing end of the market today, Pilbara Minerals (ASX:PLS) fell 11.43% after the lithium miner announced results of its 12th spodumene concentrate auction via its digital BMX platform with the company selling a combined total of 10,000dmt at an average price of $7552 per dmt. Investors also sold out of Core Lithium (ASX:CXO) and Liontown Resources (ASX:LTR) today as the price of lithium came under pressure.
The most traded stocks by Bell Direct clients today were Arafura Rare Earths (ASX:ARU), New Hope Corporation (ASX:NHC) and Pilbara Minerals (ASX:PLS).
On the commodities front, crude oil is down 1.13% at US$76.39 per barrel, uranium is flat at US$48.35 per pound, gold is down almost 1% at US$1,791 per ounce and iron ore is trading 0.45% lower at US$110 per tonne.
The Aussie dollar is buying 68 US cents, 92.61 Japanese Yen, 55.22 British Pence, and NZ$1.06.
Economic data released today included Australia’s unemployment rate held steady at 3.4% for November which was above forecasts of a decline to 3.3% while the economy added 64,000 jobs for the month, in another sign the tight labour market remains resilient despite the best efforts of the RBA.
US markets turned lower on Wednesday after the Federal Reserve raised the US cash rate by a further 50-basis points to the targeted range between 4.25-4.5%, the highest level in 15-years. The rate hike comes against signs of cooling inflation in the region with CPI for November easing to the lowest level since December last year in data out yesterday. Stocks came under pressure as markets factored in expectations that interest rates in the world’s largest economy would peak at 4.9% in the Spring.
The Dow Jones fell 0.18%, the S&P500 lost 0.22% and the Nasdaq fell 0.16%.
What to watch today:
- Over in Europe, markets slipped on Wednesday as investors globally responded to new inflation readings out of the U.S. and looked ahead to the Fed’s cash rate decision. The STOXX600 closed flat, Germany’s DAX lost 0.26%, the French CAC dropped 0.21% and, in the UK, the FTSE100 fell 0.09%. Monetary policy updates from the EU, UK and Swiss central banks will be announced today.
- On the commodities front crude oil is up 3.05% at US$77.69/barrel, uranium is down 0.72% at U.S$48.35/pound, gold is flat at US$1810/ounce and iron ore is down 2.64% at US$110.50/tonne.
- The Aussie dollar is buying 69 US cents, 92.83 Japanese yen, 55.45 British pence and 1 New Zealand dollar and 6 cents.
- Ahead of the local trading session in Australia, the SPI futures are anticipating the ASX to open almost half a percent lower following the global sell-off overnight.
- Taking a look at economic data out today, Australia’s unemployment rate is out at 11:30am Australian eastern daylight time, with some economists forecasting a drop to 3.3% for November from 3.4% in October.
Trading Ideas:
- Trading Central has identified a bullish signal on Bowen Coking Coal (ASX:BCB) following the formation of a pattern over the period of 36-days which is roughly the same amount of time the share price may rise from the close of $0.29 to the range of $0.33-$0.35 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Autosports Group (ASX:ASG) following the formation of a pattern over a period of 11-days which is roughly the same amount of time the share price may fall from the close of $1.95 to the range of $1.78-$1.82 according to standard principles of technical analysis.
The local market took lead from Wall Street today, following softer-than-expected inflation data out in America, easing investor fears of further aggressive rate hikes to come from the Fed. The ASX closed the midweek session up 0.67% buoyed by a surge in utilities stocks.
Gold miner St Barbara (ASX:SBM) soared 20% today, after the company announced the successful completion of the bookbuild for the conditional placement issuing approximately 229.2m new Genesis Minerals (AXS:GMD) shares to raise $275 million to facilitate the merger of St Barbara and Genesis Minerals. Under the planned merger, St Barbara (ASX:SBM) and Genesis (ASX:GMD) will merge their Leonora District operations in WA to form a new gold company, Hoover House. St Barbara’s other assets will be demerged to form a new junior gold company called Phoenician Metals which focuses on the long-term value of a portfolio including the Atlantic and Simberi operations.
The winning stocks of the session were led by St Barbara (ASX:SBM) adding almost 14% at the closing bell, Block (ASX:SQ2) rallying 8.15% and Chalise Mining (ASX:CHN) adding 6.41%. And on the losing end, Imugene (ASX:IMU) tanked 5.13%, while Endeavour Group (ASX:EDV) fell 4.33% and Bendigo and Adelaide Bank (ASX:BEN) fell 3.31%.
The most traded stocks by Bell Direct clients were Telstra Corporation (ASX:TLS), Arafura Rare Earths (ASX:SRU), Newcrest Mining (ASX:NCM).
On the commodities front crude oil is trading 0.2% lower at US$75.22 per barrel, gold is flat at US$1,809 per ounce, and iron ore is down 2.64% at US$110.50 per tonne.
Aussie dollar is buying 68 US cents, 92.65 Japanese Yen, 55.49 Japanese Yen and NZ$1.06.
Wall St had a positive session on Tuesday as investors digested softer-than-expected inflation data out of the US for November. Annual inflation data released for November showed the US inflation rate slowed for a fifth straight month to 7.1%, the lowest level since December last year, and below forecasts of 7.3%. For the month, inflation rose just 0.1% where the markets had been expecting a rise of 0.3%. The Dow Jones pared back earlier gains to close the session up 0.1% as investors look ahead to the FOMC meeting and Fed’s rate hike out tomorrow with the expectation of another 50-basis point rate hike. The S&P500 added 0.5% while the tech-heavy Nasdaq rallied 0.65%.
What to watch today:
- Over in Europe it’s been a turbulent start to the week with markets as investors in the region are less optimistic about the outcome of the Fed’s rate hike decision and the rate decision out of the Bank of England, European Central Bank and Swiss National Bank all revealed on Thursday. On Tuesday though, markets rallied after US inflation data came in lower than forecasted.
- The STOXX600 closed 1.1% higher, Germany’s DAX rose 1.34%, the French CAC added 1.42% and in the UK, the FTSE100 rallied 0.76%.
- In commodities:
- On the commodities front, crude oil is trading 3.95% higher at US$76.08/barrel, natural gas is up 6.3%, uranium is flat at US$48.70/pound, gold is up 1.57% at US$1809.18/ounce and iron ore is up 1.8% at US$113.50/tonne.
- Taking a look at economic data out today, core inflation data is the UK is out later this evening, while MBA mortgage applications in the US is out late tonight. Tomorrow local investors will be closely eyeing off Australia’s unemployment rate data for November with some economists expecting a decline to 3.3% from 3.4% in October.
- Locally, RBA Governor Philip Lowe is speaking at 9:30am eastern daylight time today at the annual AusPayNet Summit in Sydney.
- The Aussie dollar is buying 69 US Cents, 92.79 Japanese Yen, 55.1 British Pence, and 1 New Zealand Dollar and 6 cents.
- Ahead of the local trading session here in Australia, the SPI futures are anticipating the ASX to open 0.19% higher.
Trading Ideas:
- Bell Potter has initiated coverage of XTEK (ASX:XTE) with a buy rating and a price target of $0.95 as the Australian defence manufacturer of advanced ballistics protection equipment and supplier of cutting edge military technologies is leveraged to the current global trend of rearmament, which is likely to be a central market narrative over the next decade. The company also boasts a strong contract order book with the anticipating of first half revenue in FY23 to be ~$47m based on previously announced material contracts, and $35m in contract backlog from the technology division has XTE on track to exceed $82m in revenue in FY23 which would be another record year for the company.
- Trading Central has identified a bullish signal on DGL Group (ASX:DGL) following the formation of a pattern over a period of 18-days which is roughly the same amount of time the share price may rise from the close of $1.48 to the range of $1.83 - $1.91 according to standard principles of technical analysis.
The local market reversed Monday’s losses to close Tuesday’s session up 0.31% as a rally for technology, industrials and financial stocks boosted the key index into positive territory, while a sell-off in materials stocks pared back strong gains. Tomorrow and Thursday are the sessions investors are most anticipating this week amid the release of US inflation data and the Fed’s latest interest rate hike decision.
Star Entertainment shares came under pressure today as ASIC begins civil penalty proceedings in the Federal Court against 11 current and former directors and executives for alleged breaches of their duties.
Inoviq (ASX:IIQ) shares jumped 15% today after the cancer diagnostic and treatment development company announced positive results from its Ovarian cancer study confirming the utility of the company’s EXO-NET for EV-biomarker discovery and generation of multivariate index assay had over 90% accuracy for the detection of early-stage ovarian cancer.
The winning stocks today were led by Bendigo and Adelaide Bank (ASX:BEN) jumping 6.86% after the company provided a trading update outlining net interest margin improvements to 1.85% post revenue share arrangements YTD, unaudited cash earnings YTD of $245m, up 22% on the PCP and lending balances up 5.2% over the last 12-months. Megaport (ASX:MP1) added almost 6% today and Imugene (ASX:IMU) rallied 5.41% on Tuesday.
And on the losing end of the market, Chalice Mining (ASX:CHN) fell 8.06% as investors respond to the delay of the company’s scoping study, while Champion Iron (ASX:CIA) and Fortescue Metals Group (ASX:FMG) each also lost over 4%.
The most traded stocks by Bell Direct clients on Tuesday were MSL Solutions (ASX:MSL), Bank of Queensland (ASX:BOQ) and BHP Group (ASX:BHP).
On the commodities front, crude oil is up 1.18% at US$74.02/barrel, natural gas is up 1.55%, uranium is flat at US$48.70/pound, gold is flat at US$1782.77/ounce and iron ore is up 1.79% at US$113.50/tonne.
The Aussie dollar is buying 67.47 US cents, 92.85 Japanese Yen, 55 British Pence and 1 New Zealand Dollar and 6 cents.
Westpac consumer confidence data for December out today showed an increase of 3% from a decline of 6.9% in November as investor optimism is boosted by expectations that the RBA’s interest rate tightening cycle is nearing an end.
NAB business confidence on the other hand fell to minus 4 for November from 0 in October amid rising inflation and higher interest rates.
As traders looked ahead to the highly anticipated Federal Reserve meeting and new inflation data, US equities saw a strong session overnight. Stocks jumped back from last week’s steep losses, with a strong rally in the final hour of trade. The Dow Jones added more than 500 pints or 1.5%, the S&P500 up 1.4%, and the Nasdaq up 1.26%. The Fed will begin its two-day meeting tonight and it is widely expected that the Fed will raise rates by half a percentage point when the meeting concludes on Wednesday in the US.
However, European markets retreated ahead of the Fed’s meeting. The Stoxx 600 closed lower, with mining stocks falling the most, while only oil and gas stocks made gains. Germany’s DAX, France’s CAC and the FTSE 100 all closed in the red. Also, on Thursday we’ll receive monetary policy decisions from the Bank of England, the European Central Bank and the Swiss National Bank.
What to watch today:
- Following Wall Street’s strong session, the Australian market is set to rise 0.67% at the open this morning, going by the SPI futures.
- In economic data, today Westpac will release its data on consumer confidence for December at 10:30am and NAB will release its data on business confidence for November at 11:30am AEDT. This data will give us an indication on consumer and business sentiment, considering the impact that inflation and rising interest rates has had on households, finances and the economy.
- In commodities:
- The oil price has sharply rebounded, recovering from the daily lows of around US$70, as optimism about China’s reopening and supply disruptions offset some concerns about a global recession-driven demand downturn. Oil is trading at US$73.48 per barrel, so keep your eye on energy producers such as Santos (ASX:STO).
- The price of gold has fallen, ending a four-day advance as the US dollar gained on stronger-than- expected producer price data in the US. So watch gold mining stocks like Regis Resources (ASX:RRL) and Evolution Mining (ASX:EVN).
- Iron ore is trading around 1.4% higher at US$111.50 per tonne.
- The AU$1.00 is buying 67 US cents, 55.39 British Pence, 92.93 Japanese Yen and NZ$1.06.
Trading Ideas:
- Bell Potter maintain a BUY rating on Mincor Resources (ASX:MCR) and have lowered their price target from $1.90 to $1.85. At MCR’s current share price of $1.585 this implies 16.7% share price growth in a year.
- Trading Central have identified a bullish signal in DGL Group (ASX:DGL) indicating that the stock price may rise from the close of $1.48 to the range of $1.83 to $1.91 over 18 days according to the standard principles of technical analysis.
The ASX started the week in negative territory, closing Monday’s session down 0.45% as investors sharply sold off gold and metals and mining stocks. Investor sentiment has been extremely volatile over the last few weeks amid China’s easing of some COVID restrictions, surprisingly upbeat economic data out of the US and local economic data released that has moved markets especially on the GDP front.
Troubled fintech company Tyro Payments (ASX:TYR) tanked more than 18% today after confirming its separate takeover talks with Potentia Capital and Westpac Banking Corporation have both concluded, as the discussions have not resulted in offers the board feels fairly value Tyro. Origin Energy (ASX:ORG) shares were also sharply sold-off today as investors responded to Prime Minister Anthony Albanese’s plan to place a price cap on domestic coal and gas sales.
Gold miners had a tough start to the week as the price of the precious commodity is trading more than half a percent lower around US$1,787 per ounce. Newcrest Mining (ASX:NCM) fell over 3%, Evolution Mining (ASX:EVN) lost 3.8% and Perseus Mining (ASX:PRU) ended the day down more than 4%.
The winning stocks today were led by BrainChip Holdings (ASX:BRN) jumping 9.38% despite no price sensitive news out of the AI software and hardware technology company today. Megaport (ASX:MP1) and Woodside Energy (ASX:WDS) each also added over 4% and 3.5% respectively today. And on the losing end, Nanosonics (ASX:NAN) tanked 9.92%, Origin Energy (ASX:ORG) fell 7.82% and Silver Lake Resources (ASX:SLR) lost 7.52%.
The most traded stocks by Bell Direct clients today were Warrego Energy (ASX:WGO), Northern Star Resources (ASX:NST), and the BetaShares Australian High Interest Cash ETF (ASX:AAA).
On the commodities front, the price of oil has rebounded as the Keystone pipeline, a key pipeline in North America which links fields in Canada to refiners on the US Gulf Coast, remains shut, on top of easing COVID restrictions in China boosting demand outlook for oil. Crude oil is up almost 1% at US$71.75 per barrel, natural gas is up 10.31% at US$6.89 per MMBtu, coal is up 1.77% at US$402.50 per tonne, uranium is up 0.41% at US$48.70 per pound and iron ore is up 1.36% at US$111.50 per tonne.
The Aussie dollar has weakened to buy 67.79 US cents, 92.80 Japanese Yen, 55.46 British Pence and NZ$1.06.
After the Closing Bell Britain’s trade balance data for October and GDP for October are both released.
The local market took lead from Wall Street on Friday to close the final trading session of the week up 0.52%, led by a strong rally for materials and information technology stocks.
The winning stocks on Friday were led by Champion Iron (ASX:CIA) jumping 5.15% as China’s easing of some COVID-19 restrictions fuelled a rally in the price of iron ore, while Sandfire Resources (ASX:SFR) and BrainChip Holdings (ASX:BRN) each added 4.81% and 4.1% respectively. On the losing end of the market, Novonix (ASX:NVX) fell 4.53%, while Capricorn Metals (ASX:CMM) and Pinnacle Investment Management (ASX:PNI) tanked 4.33% and 3.77% respectively on Friday.
The most traded stocks by Bell Direct clients on Friday were Fortescue Metals Group (ASX:FMG), BHP Group (ASX:BHP) and Core Lithium (ASX:CXO).
Over in the US on Friday, Wall Street reversed again to end the week lower as investors look ahead to key inflation data and the last FOMC meeting which ae both this week. If key CPI data comes out higher-than-expected on Tuesday, the Fed’s may continue the aggressive approach at raising interest rates to tackle the nation’s 40-year high inflation. The Dow Jones fell 0.9%, the S&P500 shed 0.73% and the tech-heavy Nasdaq closed the day down 0.7%.
Over in Europe, it was a green end to the week as investor optimism was boosted by reports of China’s reopening and positive economic outlook. Germany’s DAX added 0.74%, the French CAC rose 0.46% and, in the UK, the FTSE100 rose just 0.06%. Investors in the region also await key decisions out of the Bank of England’s next policy meeting.
What to watch today:
- Ahead of the local trading session, the SPI futures is expecting the ASX to open 0.48% lower ahead of the FOMC meeting and key US inflation data out this week.
- On the commodities front, crude oil is trading 0.62% lower at US$71.02 per barrel, coal is up 1.64% at US$402 per tonne, gold is up 0.44% at US$1,797.04 per ounce and iron ore is up 1.36% at US$111.50 per tonne.
- The Aussie dollar has strengthened to buy 67.69 US cents, 92.94 Japanese Yen, 55.45 British Pence and NZ$1.06.
- On the economic data front today, British GDP data for October is out with the market expecting growth to 0.4% from a decline in growth of 0.6% in September.
Trading Ideas:
- Trading Central has identified a bullish signal on Azure Minerals (ASX:AZS) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price will rise from the close of $0.26 to the range of $0.32-$0.34 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Dalrymple Bay Infrastructure (ASX:DBI) following the formation of a pattern over a period of 20-days which is roughly the same amount of time the share price may fall from the close of $2.40 to the range of $2.28-$2.30 according to standard principles of technical analysis.
The Aussie share market lost 1.73% this week (Mon-Thu), as investor fears of a global recession increased and GDP growth data in Australia came in below expectations causing investors to analyse their sector exposures.
In this week's wrap, Grady covers:
- (0:12) Market expectations on consumer spending
- (1:27) The changing outlook for retail companies
- (2:59) Private consumption as a percentage of GDP in Australia
- (3:24) The best performing stocks in the ASX200
- (5:05) The most traded stocks & ETFs by Bell Direct clients
- (5:30) Three economic news items to watch out for
Wall Street felt some relief on Thursday after new weekly jobless claims in the US ticked higher to 230,000 from 226,000 the week prior in a sign the Fed’s aggressive interest rate hikes are beginning to have an impact on the nation’s tight labour market. The slight uptick in jobless claims underpinned a rally on Thursday that saw the Dow Jones add 0.3%, the S&P500 lift 0.5% and the tech heavy Nasdaq added 0.9%.
Despite the slight relief rally, investors remain focused on the Fed’s FOMC meeting next week where it is expected another 50-basis points.
Over in Europe, markets closed mostly lower again as investor fears of a global recession continued to dominate sentiment across markets in the region. Germany’s DAX added just 0.02%, while the French CAC fell 0.14% and the UK’s FTSE100 lost 0.23%.
What to watch today:
- Ahead of the local trading session the SPI futures is anticipating the ASX to open 0.31% higher buoyed by the rally on Wall St overnight.
- On the commodities front, crude oil continues its decline trading 0.7% lower at US$71.51/barrel, coal is trading almost 1% lower at US$405/tonne, gold is up 0.11% at US$1788/ounce and iron ore is down 1.83% at US$107.50/tonne.
- The Australian dollar has strengthened to buy 67.73 US cents, 92.58 Japanese yen, 55.33 British pence and 1 New Zealand dollar and 6 cents.
- Taking a look at economic data out today, China’s inflation rate data for November is released around midday Australian eastern daylight time, with the market expecting a decline to 1.6% from 2.1% in October.
Trading Ideas:
- Trading Central has identified a bearish signal on Viva Energy Group (ASX:VEA) following the formation of a pattern over a period of 157-days which is roughly the same amount of time the share price may fall from the close of $2.66 to the range of $1.95-$2.10 according to standard principles of technical analysis.
- And Trading Central has also identified a bearish signal on Bravura Solutions (ASX:BVS) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may fall from the close of $0.78 to the range of $0.40-$0.48 according to standard principles of technical analysis.
The ASX took strong lead from global markets overnight into Thursday’s session, finishing the day down 0.75% as investors continued to flee high growth tech stocks in the rising interest rate environment. The worst performing sector today was energy stocks, while 7 of the 11 sectors also closed red today.
Chalice Mining (ASX:CHN) soared 13% today after the exploration company announced promising new sulphide mineralisation at the company’s initial drilling at the greenfield Hooley Prospect, around 5km north of the current Gonneville Resources at the 100%-owned Julimar Nickel-Copper-Platinum Project in WA. Sulphide mineralisation was intersected at all 5 reconnaissance holes from three drill sites over the prospect, with assays pending for a further nine holes.
All four big banks have passed on the full 25-basis points rate hike to variable interest rate customers, but none have announced whether, if at all, the rate hike will be passed onto term deposit customers.
Downer (ASX:DOW) shares plunged more than 21% today after the engineering group flagged accounting irregularities and cut its profit guidance for FY23 in an update to investors. The winning stocks from today’s session were led by Chalice Mining (ASX:CHN) adding 13%, West African Resources (ASX:WAF) added 4.65% and Sliver Lake Resources (ASX:SLR) jumped 3.88%. And on the losing end of the session, Downer (ASX:DOW) led the losses tanking 20.42%, Core Lithium (ASX:CXO) fell almost 10% and Novonix (ASX:NVX) shed 8.09% today.
The most traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), Yancoal (ASX:YAL), and Commonwealth Bank of Australia (ASX:CBA).
On the commodities front this afternoon, crude oil is trading 0.86% higher at US$72.64 per barrel, coal is down 0.93% at US$405 per tonne, gold is down 0.22% at US$1,782 per ounce, and iron ore is down almost 2% at US$107.50 per tonne.
The Aussie dollar is buying 67.15 US cents, 91.99 Japanese Yen, 55.01 British Pence, and NZ$1.06.
In economic data out today, Australia’s trade balance for October was unveiled with a surprise slight fall to $12.217 billion in trade surplus, which well exceeds the forecasted decline to $11.9 billion, indicating exports and imports remained relatively unchanged from September to October.
Wall Street extended the recent red run into the midweek session as investors fear higher interest rates and a subsequent economic downturn are increasingly likely given recent surprising economic data out in the US. The Dow Jones fell 0.2%, the S&P500 lost 0.3% and the tech heavy Nasdaq shed 0.7%.
Further remarks from a host of Wall Street executives added to investor fears of recession, with JPMorgan CEO Jamie Dimon saying the US$1.5trn in excess savings across America’s bank accounts was quickly diminishing amid rising prices of goods and services.
Over in Europe, the global sell-off continued amid rising fears of a global recession. Germany’s DAX fell 0.57%, the French CAC lost 0.41% and in the UK, the FTSE100 closed the midweek session down 0.43%.
On the commodities front, oil extended losses overnight trading 2.78% lower at US$72.18/barrel, coal is down almost 1% at US$405/tonne, gold is up almost 1% at US$1787.67/ounce and iron ore is flat at US$109.50/tonne.
The Aussie dollar is buying 67.27 US cents, 91.76 Japanese yen, 55.05 British pence and 1 New Zealand dollar and 6 cents.
What to watch today:
- Ahead of the local trading session here in Australia the SPI futures is anticipating the ASX to open 0.26% lower on the back of the turbulent global sessions overnight.
- Taking a look at economic data out today, Australia’s trade balance data for October is released with the market expecting a decline in trade surplus to $11.9bn from $12.44bn in September.
Trading Ideas:
- Bell Potter has initiated coverage of The Environmental Group (ASX:EGL) with a buy rating and a price target of $0.26, as the company is seen to be at a significant inflection point. In Bell Potter’s view, core segments validate the majority of EGL’s current share price, providing a cheap option on a high ceiling polyfluoroalkyl substances (PFAS) opportunity.
- Trading Central has identified a bullish signal on Maggie Beer Holdings (ASX:MBH) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may rise from the close of $0.21 to the range of $0.24-$0.26 according to standard principles of technical analysis.
US equities declined overnight, with the Dow dropping by 526 points or 1.5%, while the S&P500 and the Nasdaq fell by 2% and nearly 2.3%, respectively. While equities fell, bond yields pushed higher, with the yield on the benchmark 10-year Treasury last trading up 10 basis points.
Big movers overnight were Microsoft, Amazon and Netflix which all closed lower on growth concerns. Tesla shares also dropped about 7% on reports of an output cut at its Shanghai factory.
In Europe, markets closed fixed, with the FTSE 100 closing in the green, while the other major benchmarks were lower. Oil prices turned negative in late afternoon trade in Europe as OPEC stuck to its policy of lowering oil production and as China relaxed some of its COVID rules. The alliance of OPEC and non-OPEC producers agreed to stay the course on output policy ahead of the EU’s ban on importing Russian crude that came into force yesterday.
What to watch today:
- The Australian market is set to open lower ahead of the final RBA policy meeting of the year, with the SPI futures suggesting a fall of 0.67% at the open.
- The RBA will announce the next interest rate decision at 2:30pm AEDT. The cash rate is currently at 2.85%, and the market is expecting an increase to over 3%, which will be the eighth consecutive increase and will lift the cash rate to its highest level in 10 years.
- In other economic news, the ABS will release Q3 data on Australia’s current account surplus, which last jumped to $18.3 billion in Q2. And US trade balance data for October will be out tonight.
- In commodities,
- Oil is trading over 3.5% lower at around US$77 per barrel, which is a dramatic reversal from its daily highs of around US$82. Investors grew risk averse, which boosted the US dollar but hurt equities, and made the commodity more expensive for holders in other currencies.
- Gold is down 1.65%, falling from a 5-month high as the US dollar and Treasuries lifted.
- While iron ore is trading over 1% in the green, the highest since late August as eased COVID curbs and measures to stimulate China’s economy has increased expectations for higher demand.
- Watch the Bank of Queensland (ASX:BOQ) today as the company is set to hold its AGM.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Strike Energy (ASX:STX) with a $0.42 valuation. At its current share price of $0.32, this implies 29% share price growth in a year.
- Trading Central have identified a bullish signal in BetMakers Technology (ASX:BET) indicating that the stock price may rise from the close of $0.32 to the range of $0.37 to $0.39, over 30 days according to the standard principles of technical analysis.
The local market advanced 0.33% today driven by a rally for materials stocks amid a rise in the price of iron ore. Fortescue Metals Group (ASX:FMG), BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO) each added almost 7%, almost 3% and 4% respectively.
The price of iron ore also jumped today as China loosened the curbs on its COVID-19 restrictions including Shenzhen and Beijing removing the requirement for commuters to produce a negative COVID-19 test before boarding public transport, enhancing demand outlook for iron ore. The price of oil jumped 1.28% today after OPEC+ decided to maintain oil production and current levels of reducing oil output by 2 million barrels a day from November through 2023 amid increased Western sanctions set to be placed on Russian oil set to kick in soon in addition to China easing restrictions boosting demand outlook. The EU is set to ban most seaborne Russian oil imports from Monday.
Splitit (ASX:SPT) lifted over 8% today after the buy now, pay later company expanded its agreement with Google, to bring instalment payments solutions to the Google store in the US, Canada and Australia. OreCorp (ASX:ORR) took flight today amid production outlook of 240,000 ounces of gold per year for 1—year at its Nyanzaga Gold Project in Africa. The company recently received debt funding proposals to fund the development of this project, including non-binding expressions of interest from banks in Europe, Africa and Tanzania for more than US$400 million. Gina Rinehart has expanded her presence in the rare earths space through buying a 10% stake in Arafura Rare Earths via a $60 million investment in a $121m capital raising.
The most traded stocks by Bell Direct clients today were St Barbara (ASX:SBM), Rio Tinto (ASX:RIO) and Nickel Industries (ASX:NIC).
The Aussie dollar is buying 68.46 US cents, 55.36 British Pence, 91.95 Japanese Yen and NZ$1.06.
On the economic data front today, third quarter company profits in Australia unexpectedly fell 12.4% in data released today, missing market expectations and indicating the RBA’s rate hike actions to date have started taking effect. The decline in company profits for the quarter was the first drop since Q4 2020, with the largest decline felt in mining, manufacturing and recreation services. Year to date, Q3 corporate profits rose by 8.5% which is a sharp decline from the 28.2% surge in Q2.
On the commodities front, natural has is down 6.3%, coal is up 1.56% at US$391 per tonne, uranium is down 1.2% but gold is up 0.62% at US$1809 per ounce, and iron ore is up 1.43% at US$106.70.
The local market dipped 0.72% on Friday, ending the recent rally, as investors await the RBA’s interest rate decision for December out on Tuesday this week. The gold miners had a run on Friday as investors piled into gold stocks on the back of a rise in the price of the precious commodity, while investors fled REIT stocks in anticipation of the RBA’s latest rate hike announcement on Tuesday. REIT stocks have faced a tough run in 2022 as every interest rate hike implies further dent into real estate company balance sheets.
The winning stocks on Friday were led by St Barbara (ASX:SBM) jumping 10.40% amid the rising price of gold, while Capricorn Metals (ASX:CMM) and Silver Lake Resources (ASX:SLR) each added just over 8% and 7% respectively at the closing bell on Friday. On the losing end, Corporate Travel Management (ASX:CTD) fell 5.85% on Friday despite no price sensitive news out of the travel company on Friday. Meanwhile IPH (ASX:IPH) and Charter Hall (ASX:CHC) each also fell 5.15% and 5.13% respectively to close out the week.
The most traded stocks by Bell Direct clients on Friday were Karoon Energy (ASX:KAR), Alcidion (ASX:ALC) and Fortescue Metals Group (ASX:FMG).
Wall Street also finished the last trading session of the week mixed across the key indices as non-farm payrolls data for November was released, coming in a lot stronger than expected which leaves the door open for the Fed’s to consider continued aggressive interest rate hikes to tackle the red-hot inflation in the region. The Dow Jones added just 0.1%, the S&P500 was unchanged and the Nasdaq fell 0.18%. Nonfarm payrolls data for November showed the US economy added 263,000 jobs for the month which beat consensus expectations for an increase of 200,000. While this is just one market report, it comes at a time where there was also a recent upside surprise on wage growth and weakening participation rate. Wages growth in inflation is a bad thing as wages are a large share of company costs, so when wages rise companies continue raising prices to counter the wage cost increase on finances. Investors and the market will now shift focus in the US to the upcoming CPI data for November out on December 13.
Over in Europe, stocks closed mixed across the European markets as investors react to US jobs data and the ongoing debate around a price cap on Russian oil. Oil and Gas stocks led losses across markets after the EU tentatively agreed to a $60/barrel price cap on Russian seaborne oil according to Reuters. Germany’s DAX closed Friday’s session 0.27% higher, while the French CAC fell 0.17% and, in the UK, the FTSE100 fell just 0.03%.
What to watch today:
- Ahead of the local trading session here in Australia, the SPI futures are expecting the market to recover from Friday’s sell-off to open 0.26% higher.
- Taking a look at commodities to start the week, it’s a red start across the board with Crude Oil trading down 1.53% at US$79.98 per barrel, natural gas is down 7.53%, gold is down 0.31% at US$1797.35 per ounce but iron ore is up 1.43% at US$106.50 per tonne.
- The Aussie dollar has strengthened to buy 67.9 US cents, 91.28 Japanese Yen, 55.35 British Pence and NZ$1.06.
- In terms of economic data out today, local investors will be keeping an eye out for Australia’s global services PMI final data for November, and company gross profits for the third quarter.
Trading Ideas:
- Trading Central has identified a bullish signal on Red 5 (ASX:RED) following the formation of a pattern over a period of 48-days which is roughly the same time the share price may rise from the close of $0.20 to the range of $0.23 to $0.24 according to standard principles of technical analysis.
- Bell Potter has maintained a buy rating on IPD Group (ASX:IPG) but has increased the price target from $2.25 to $3.35 following a new cyclical trend noticed in demand for electrification which IPD Group is
The Aussie share market rallied 1.3% this week (Mon-Thu), encouraged by the Chairman of the Federal Reserve, Jerome Powell’s speech, that essentially confirmed the Fed will slow the pace of interest rate hikes in December.
In this week's wrap, Sophia covers:
- (0:15) What to expect from OPEC's meeting on Sunday
- (0:34) The impact of a price cap on Russian crude
- (1:01) What production cuts really mean for energy markets
- (3:20) The best performing stocks on the ASX200
- (4:11) The most traded stocks & ETFs by Bell Direct clients
- (4:38) Five economic news items to watch out for
Following Fed chairman’s Jerome Powell’s speech that essentially confirmed that the Fed will slow the pace of interest rate hikes, we saw a surge in equities that added over $1 trillion to the market capitalisation of the S&P500 alone. Meanwhile the Dow Jones hit a 7-month high and its 12-month return turned positive. The Dow has already rallied over 20% from its year-to-date low.
Overnight however, the three major benchmarks closed mixed ahead of the US jobs report. The Dow closed 0.6% lower, the S&P500 down 0.1%, while the Nasdaq is slightly higher, up just 0.09%.
On the other hand, European equities hit six-month highs. The Stoxx 600 is up 0.9%, however the FTSE 100 closed 0.2% lower.
What to watch today:
- Following the mixed sessions in global markets, the SPI futures are suggesting out local market will drop 0.2% at the open this morning.
- In commodities:
- Oil is trading higher, as investors are weighing the prospects of a recovery in demand against further supply cuts from OPEC, ahead of OPEC’s upcoming meeting on December 4th.
- Gold has jumped almost 2% higher, reaching its highest level since early July, due to the sharp US dollar depreciation.
- Iron ore is currently trading flat.
- In economic data, there are a few key figures set to be released globally. Locally, Australia’s retail sales data and home loans data for October is set to be released today. Plus, RBA Governor Phillip Lowe is set to give a speech at 1pm AEDT. Overseas, the Eurozone Producer Price Index for October and the US unemployment rate for November are out tonight. And investors are also awaiting OPEC’s meeting on Sunday.
- Watch Premier Investments Limited (ASX:PMV) as the company is set to hold its AGM today.
Trading Ideas:
- Bell Potter maintain a Buy rating on PolyNovo (ASX:PNV), which is a commercial stage medical device company. The $30 million placement conducted last week significantly strengthens the company’s balance sheet. Bell Potter says it provides the growth platform facilitating the expansion of the US and global sales team with key markets in Asia and Canada being targeted. Bell Potter have increased their price target from $1.90 to $2.30, and their price target is purely generated from their Discounted Cash Flow methodology, as this best captures the longer term potential for PolyNovo. At PNV’s current share price of $2.03, this implies 13.3% share price growth in a year.
The Australian market jumped at the open this morning, after the US Federal Reserve Chairman Jerome Powell confirmed last night that smaller rate hikes could start as early as December. Our market then followed the rally on Wall Street and the ASX200 closed 0.96% in the green.
In economic news, domestic new capital expenditure fell 0.6% for the September quarter.
The materials sector climbed for the second straight day, as commodities rallied overnight. Both Ramelius Resources (ASX:RMS) and South32 (ASX:S32) posted strong gains, closing 10.5% and 6.7% respectively. Meanwhile the energy sector was the worst performing sector, dragged down by Woodside Energy (ASX:WDS), Whitehaven Coal (ASX:WHC) and New Hope (ASX:NHC).
Financials were generally higher, with the big four banks adding between 0.3% and 0.8%.
Artificial intelligence company Appen (ASX:APX) jumped today, following a strong night of trade among tech stocks on Wall Street, with the Nasdaq up more than 3% by the close. Also boosted by the strong session In tech shares was accounting software company Xero (ASX:XRO) and payment company Block (ASX:SQ2). Citi also released a bullish broker note on XRO, maintaining their Buy rating and price target of $97.90. XRO today closed at $75.08.
The comments by the Fed also provoked investors to move back into gold. The All Ords Gold Index (ASX:AXGD) closed 4% higher today, and gold mining stocks such as Evolution Mining (ASX:EVN) posted strong gains.
The most traded stocks by Bell Direct clients today were Telstra (ASX:TLS), Core Lithium (ASX:CXO), Rio Tinto (ASX:RIO) and BHP Group (ASX:BHP).
As for economic data out tonight, the US Manufacturing PMI, run by the Institute for Supply Management will be release at 2am local time. This is the US’s version of the monthly economic indicator, based on a survey of purchasing managers at more than 300 manufacturing firms. And the purchasing managers’ index is considered to be a key indicator of the state of the US economy and provides us data on economic trends in the manufacturing sector.
The Australian dollar is firmer, with 1 Australian dollar buying US$0.68, 93.06 Japanese Yen, 55.77 British Pence and NZ$1.08.
It was a strong session overnight after Federal Reserve chairman Jerome Powell signalled that the pace of rate rises will slow as soon as this month. The Dow Jones jumped 535 points or 1.6%. The S&P500 added 2.4% and the Nasdaq jumped 3.6%, while the 10-year Treasury yield slightly eased. The Fed also cautioned that they may still stay with restrictive policy, with a long way to go in restoring price stability.
Wrapping up the month, the Dow and the S&P500 are up more than 4%, and the Nasdaq up around 3%.
European markets closed higher, as regional investors reacted to the latest inflation data. Eurozone inflation dropped by more than expected in November, fuelling market hopes that record-high price growth has peaked, and the European Central Bank will begin slowing its interest rate hikes next month. The major benchmarks were all in the green, with the Stoxx 600 up 0.6%, Germany’s DAX up 0.3%, France’s CAC up 1.04% and the FTSE 100 up 0.8%.
Asia-Pacific shares were mostly higher even after data for China’s factory activity fell short of expectations, dropping to the lowest reading since April.
What to watch today:
- Our local market is set to open higher, with the SPI futures suggesting a rise of 0.73% this morning.
- In economic data, the S&P Global Manufacturing final PMI for November will be released a 9am AEDT this morning. Remember a PMI above 50 represents an expansion from the month prior. The degree to which the reading is above 50 reflects how fast the manufacturing sector is expanding.
- Looking at commodities,
- Oil has rallied, trading 3.2% higher at US$80.70 per barrel, supported by larger-than-expected crude inventories.
- Gold has jumped 1.2% higher, closing in on its highest level in two weeks, on expectations of a smaller rate hike by the Fed in December. Markets are now expecting a 50-basis point hike, after the Fed delivered four straight 75 basis point increases.
- Iron ore is trading 2.5% higher at US$103 per tonne, the highest since mid-September, while seaborne iron ore is also trading just under 1% higher.
- Nickel is trading almost 5% higher. The London Metals Exchange stepped up market surveillance activity in response to a rally that saw Nickel surge by 40% to a six-month high of around US$30,000 in just two weeks. The sharp price swing raised concerns about a liquidity crisis. Nickel is currently trading at US$26,744 per tonne.
- Aluminium has also gained, up 4%.
- Watch BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO) today, after the mining giants both posted gains on the New York Stock Exchange overnight. ASX-listed BHP and RIO may follow lead.
- Stocks set to go ex-dividend today are Pendal (ASX:PDL) and TechnologyOne (ASX:TNE). Remember this often sees shares fall as investors take their profits.
Trading Ideas:
- Bell Potter maintains their Buy rating on Life360 (ASX:360) and their price target of $9, which is expected to return 49%. The next potential catalyst they see for 360, is the release of the 2022 results in March next year. Preliminary results will be released in February, where they expect the guidance to be met.
- And Trading Central have identified a bullish signal in DevEx Resources (ASX:DEV) indicating that the stock price may rise from the close of $0.33 to the range of $0.38 to $0.40 over 30 days, according to the standard principles of technical analysis.
In the first hour of trade, the Australian share market was lower ahead of the monthly inflation reading, however when CPI was announced at 11:30am, good news boosted the market. The monthly consumer price index advanced 6.9% in the year to October, slowing from September’s record high of 7.3%, and below market consensus of a 7.4% gain. The reading showed a softer rise in food prices than previously, however prices were rising across most food categories, with prices rising the most in fruit and vegetables and meat and seafoods. The RBA expects inflation to peak at the end of the year at around 8%.
In other economic news, October residential building approvals slid 6.4% on the year.
The materials sector advanced today, with lithium miners lifting the group. Coal miners were also buoyant, with Whitehaven Coal (ASX:WHC) and New Hope Corporation (ASX:NHC) closing with solid gains. The energy sector was the best performer, advancing 1.8%, followed by real estate stocks. Financials on the other hand, were weighed down by insurance companies, with Insurance Australia (ASX:IAG), Suncorp (ASX:SUN) and QBE Insurance (ASX:QBE) all in the red. And utilities, consumer staples and healthcare were the worst performing sectors.
Looking at the AX200 leaderboard, Sayona Mining (ASX:SYA) jumped over 12% today, followed by Whitehaven Coal (ASX:WHC), New Hope (ASX:NHC) and Lake Resources (ASX:LKE). The worst performing stock was gold miner St Barbara (ASX:SBM).
The Australia dollar is slightly up, with 1 Aussie dollar buying US$0.67, 55.85 British Pence, 92.81 Japanese Yen, and NZ$1.08.
Wall Street closed mostly lower on Tuesday as investors shift focus to the week ahead, filled with key economic data and Fed Chair Jerome Powell’s speech on Wednesday where he is expected to talk about the fiscal and monetary policy. Investors also struggled to recover from sharp losses faced in Monday’s session. The Dow Jones fell just 1 point, the Nasdaq shed 0.6% and the S&P500 closed the day down 0.2%. Investors are anxiously awaiting the release of important jobs and indicative GDP data for Q3 which is out later this week and will play an important role in the Fed’s next interest rate decision at the next FOMC meeting on December 14.
Over in Europe markets closed lower across the board as investors continue to monitor news from China on the COVID-restrictions front. The Stoxx 600 closed down 0.1%, Germany’s DAX fell 0.2% and the French CAC lost 0.06%. Over in the UK, the FTSE100 declined 0.51%.
What to watch today:
- On the commodities front, crude oil is trading up 1.13% at US$78.16 per barrel, gold is trading up 0.6% at US$1,751 an ounce, and iron ore is trading down almost 1% at US$100.50 a tonne.
- Looking at economic data out today, it’s a big data day for Australia’s building industry with construction work done for Q3 out at 11am eastern daylight time, and building permits preliminary data for October is out at 11:30am eastern daylight time. Overseas investors will be awaiting the release of US GDP growth rate data 2nd estimate for Q3 with markets expecting an increase of 2.6% for the quarter. JOLTs Job Openings data for October is also out tomorrow which will give an insight into America’s workforce in the tight labour environment.
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open flat following the lacklustre session on Wall Street overnight.
- The Aussie dollar is buying 66.88 US cents, 92.62 Japanese Yen, 55.75 British Pence and NZ$1.08.
Trading Ideas:
- Bell Potter has downgraded its price target on Bubs Australia (ASX:BUB) following the recent shortfall in Q1 of FY23 infant milk formula revenues compared to Bell Potter expectations, and negative year-on-year growth implied in the second quarter expected revenue guidance warrants a more cautious approach to near term revenue growth, earnings growth and valuation.
- Trading Central has a bullish signal on Coronado Global Resources (ASX:CRN) following the formation of a pattern over a period of 17-days which is roughly the same amount of time the share price may rise from the close of $2.02 to the range of $2.37-$2.45 according to standard principles of technical analysis.
Our local market gained just 0.3% today. While the ASX200 was trading quite flat today, Qantas shares were outperforming the XJO, as well as other travel stocks, amid news that Qantas Frequent Flyer has launched thousands of points planes to coastal cities over the summer. More than 3,000 flights will be turned into what’s referred to as “points planes” where every seat can be booked under a classic flight reward. Late last week, brokers retained their Buy recommendations on QAN. UBS and Ord Minnett retained a Buy, Credit Suisse and Macquarie both Outperform and Morgan Stanley Overweight.
A boost in iron ore futures prices saw mining stocks advance today. The materials sector performed best, gaining 1.7%, followed by healthcare and technology, while real estate declined the most.
The best performing stocks on the ASX200 today were Fisher and Paykel (ASX:FPH), Nanosonics (ASX:NAN) and Rio Tinto (ASX:RIO), while the worst performers were Collins Foods (ASX:CKF), ASX (ASX:ASX) and Virgin Money UK (ASX:VUK).
The most traded stocks by Bell Direct clients today were Core Lithium (ASX:CXO), APA Group (ASX:APA), BHP Group (ASX:BHP) and Commonwealth Bank (ASX:CBA).
The Australian dollar is buying US$0.67, 92.85 Japanese Yen, 55.85 British Pence and NZ$1.08.
Global markets closed in the red overnight, after protests in China raised worries around supply chains. Stocks fell as social unrest from China’s prolonged COVID restrictions weighed on markets around the world. Chinese governments tightened some COVID controls as case numbers rose, even though earlier this month Beijing adjusted some policies that otherwise suggested the country’s reopening.
This saw oil futures hovering around brand-new lows for this year, earlier in the trading day, due to concerns around demand.
In US equities, the Dow Jones dropped more than 500 points or 1.5%. The S&P500 and the Nasdaq each dropped 1.7%.
China is the world’s second-biggest economy, so almost all markets are affected in some way. We also saw Bloomberg report that it could mean 6 million fewer iPhone units for the year, as the factories in China are shutdown, and this saw Apple shares drop 2.8%.
European equities were down also. The STOXX 600 down 2.9%, Germany’s DAX down 1%, France’s CAC down 0.7% and in the UK the FTSE 100 down 0.2%.
What to watch today:
- The SPI futures are suggesting the Australian market will open flat this morning.
- In commodities:
- Currently oil prices have rebounded, now trading 1% higher at US$77 per barrel, after having hit an 11-month low of US$73.50 earlier in the session. As well as the protests in China, there are also rumours of an OPEC production cut. Keep your eye on energy producers today such as Santos (ASX:STO) and Beach Energy (ASX:BPT).
- Meanwhile the price of gold is reading 0.85% lower, pressured by a recovery in the US dollar.
- The iron ore price has jumped 2.5% at US101.50 per tonne and is set to close the month nearly 25% higher at levels last seen in mid-September. In iron ore markets, expansionary measures from China to sustain slowing economic growth, outweighed the concerns about the protests. So keep watch of Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG), Champion Iron (ASX:CIA) and BHP Group (ASX:BHP).
Trading Ideas:
- Bell Potter maintain a Buy rating on IPD Group (ASX:IPG), which is a leading Australian distributor of electrical equipment and industrial digital technologies operating nine distribution centres and services over 4,200 customers nationally. Bell Potter maintained their recommendation after the company’s AGM yesterday, where they released H1 2023 estimated guidance well-ahead of Bell Potter’s estimated forecasts. Bell Potter say that the company provides investors with leverage to a new life cycle of demand, which in Europe has seen a more than 15% market growth per annum over the last two years. Bell Potter have increased their price target from $2.25 to $3.35, and at its current share price of $3.05, this implies 9.8% share price growth in a year.
- Trading Central have identified a bullish signal in NEXTDC (ASX:NXT) indicating that the stock price may rise from the close of $9.82 to the range of $11 to $11.30 over 51 days according to the standard principles of technical analysis.
The local market started the week in negative territory, closing the session down 0.42% as a sharp sell-off in energy stocks weighed on the key index driven by commodity prices plunging. Oil retreated to its lowest level since 2021 today, amid unrest in China as large crowds gathered in Shanghai, Beijing and Wuhan to protest over the harsh COVID-19 restrictions in the region. Sentiment in the oil market has remained a key focus in recent times amid concerns over demand in China, the world’s largest importer of crude oil. The price of oil has also been impacted in recent days as the EU continues to negotiate over a price cap on Russian oil. Across the other commodities, gold is trading 0.31% lower at US$1750 per ounce, while iron ore is up 2.53% at US$101.50 per tonne.
RBA governor Philip Lowe has this morning apologised to Australians who took out mortgages expecting interest rates to stay unchanged through 2024. Mr Lowe said the RBA had failed by not making it clear that its commentary about steady interest rates was heavily conditional on the state of the economy.
Investors continued selling out of lithium stocks today on concerns demand for electric vehicles in China is weakening after EV registrations in China plummeted by more than a fifth in October from September.
The winning stocks today were led by New Hope Corporation (ASX:NHC) adding 5.4%, Whitehaven Coal (ASX:WHC) rallying almost 4% and Brickworks (ASX:BKW) ending the day up 3.2%. And on the losing end, Healius (ASX:HLS) took the biggest hit today, falling just over 10%, while Liontown Resources (ASX:LTR) and Ramelius Resources (ASX:RMS) each fell 7.5% and 6.5% respectively.
The most traded stocks by Bell Direct clients today were Bendigo & Adelaide Bank (ASX:BEN), Bank of Queensland (ASX:BOQ) and Telstra (ASX:TLS).
Preliminary retail sales data for October out today shows consumer spending has declined for the first time in 2022, with sales down 0.2% on September in a sign rising interest rates are starting to have an impact on consumer spending which in-turn is part of the RBA’s goal to cool the nation’s inflation.
The Aussie dollar is buying 66.85 US cents, 55.85 British Pence, 92.61 Japanese Yen and NZ$1.08.
The local market climbed 0.25% on Friday as investors anticipated strong Black Friday sales demand would boost the beaten down consumer discretionary sector. Utilities stocks soared 5% on Friday, while materials and energy stocks were sold off.
The winning stocks on Friday were led by Nanosonics (ASX:NAN) lifting 11.06% on the back of Ord Minnett upgrading the company to a hold rating with an improved price target of $4.00. Ramelius Resources (ASX:RMS) jumped almost 7% on Friday and Virgin Money UK (ASX:VUK) rose 6.12%. On the losing end, Allkem (ASX:AKE) fell 8.61% on Friday, amid a sell-off in lithium stocks on reports that the price of lithium may have hit a price ceiling. Pilbara Minerals (ASX:PLS) and Lake Resources (ASX:LKE) also each fell 6.7% and 5.7% respectively.
The most traded stocks by Bell Direct clients on Friday were New Energy Solar (ASX:NEW), Pilbara Minerals (ASX:PLS) and Fortescue Metals Group (ASX:FMG).
Wall Street had a slightly mixed session on Friday as investors shifted focus to Black Friday online sales, which topped a record US$9 billion. Investor optimism was also boosted last week on renewed signs that the Fed’s may soon begin easing the aggressive rate hikes tackling inflation. Buy now pay later methods of purchasing goods during Black Friday sales rose 78% compared with the week prior as consumers turned to instalment payments amid rising interest rates. The Dow Jones rose 0.45% on Friday, while the Nasdaq and S&P500 each fell 0.52% and 0.03% respectively.
Over in Europe, markets closed flat with mining and financial stocks taking the biggest hit. Credit Suisse shares fell to a record low on Friday despite the company securing $4 billion from investors to fund its second strategic overhaul. The STOXX600 closed just 0.025% lower on Friday, Germany’s DAX rose 0.01%, the French CAC added 0.08% and the FTSE100 in the UK rose 0.27%.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open 0.12% lower to start the new trading week.
- On the commodities front crude oil has dipped 2.31% to trade at US$76.28 per barrel, gold is up 0.07% at US$1756.2 per ounce, and iron ore is up 2.53% at US$101.50 per tonne.
- The Aussie dollar has strengthened to buy 67.19 US cents, 93.55 Japanese yen, 55.83 British pence and NZ$1.08.
- Taking a look at economic data out today, Australian preliminary retail sales data for October is out, giving an insight into whether consumers continued spending on retail in October as interest rates continue to rise. RBA governor Philip Lowe will also speak at 10am AEDT today giving an insight into the RBA’s interest rate stance moving forward.
Trading Ideas:
- Trading Central has identified a bullish signal on BetMakers Technology (ASX:BET) following the formation of a pattern over a period of 24-days, which is roughly the same amount of time the share price may rise from the close of $0.30 to the range of $0.35 to $0.37 according to standard principles of technical analysis.
- Bell Potter has downgraded its rating on Costa Group (ASX:CGC) from a Buy to a Hold on the grounds of continuing to see the issues of CY22 as largely seasonal rather than structural, however the recent share price recovery has seen the value equation shift back in favour of the other ASX listed horticultural exposures.
The Aussie share market lifted 3.6% this week (Mon-Thu), as investor sentiment was boosted by signs that the RBA and other central banks will ease their aggressive stance on rates. Plus we put the magnifying glass on some of 2022’s big deals.
In this week's wrap, Grady covers:
• (0:13) How companies & investors navigated M&As this year
• (0:36) The mining deal between BHP & OZ Minerals
• (1:26) Perpetual's bidding war over Pendal
• (3:39) The best performing stocks on the ASX200
• (4:40) The most traded stocks & ETFs by Bell Direct clients
• (5:12) Four economic news items to watch out for
US financial markets were closed for the Thanksgiving holiday, with trading set to resume on Friday in New York. However, markets will close early at 1pm local time.
European stocks rallied to levels last seen 3 months ago, with the STOXX 600 closing at its strongest level since August 18, led by gains in real estate stocks.
What to watch today:
- The SPI futures are suggesting the Australian market will rise 0.18% at the open this morning.
- In commodities:
- The oil price has slightly rebounded, regaining only some of its earlier losses, after closing at a two-month low in the previous session, as the price continues to be pressured by COVID cases in China. This is causing concerns of tighter restrictions in China, which would affect energy demand. Also, the G7 proposed a price cap on Russian oil in the range of US$65-70 per barrel. However, the high cap won’t cause disruption to Russian flows and so will likely have minimal effect on markets.
- The gold price continues to rise for the third straight day, after the Federal Reserve’s meeting minutes were released, which showed that a substantial majority of policymakers agreed it would likely soon be appropriate to slow the pace of interest rate hikes.
- Iron ore is trading over 1% higher, nearing the eight-week high of US$99.50, hit on November 18. This is due to fresh liquidity injections to steel consumers from China, of course a top consumer.
- Goldman Sachs this morning downgraded BHP group (ASX:BHP) to a neutral rating with an improved price target of $42.90, after assessing its valuation against global peers. Meanwhile, Goldman Sachs is more optimistic toward Rio Tinto (ASX:RIO), this morning reiterating its buy rating with an improved price target of $114.70, saying that the development of Rhodes Ridge has the potential to be significant for Rio’s Pilbara business.
Trading Central:
- Bell Potter maintain a Buy rating on Volpara Health Technology (AX:VHT) and maintain their price target of $1.10. FY23 revenues are reduced by $2.1 million to $35.5 million, which is $1 million above guidance. H2 revenues are reliably higher than H1 and Bell Potter expect this trend will continue. At VHT’s current share price of $1.10, this implies 69.2% share price growth in a year.
- Trading Central have identified a bullish signal in Reliance Worldwide (ASX:RWC) indicating that the stock price may rise from the close of $3.19 to the range of $3.32 to $3.39, over 16 days, according to the standard principles of technical analysis.
The local market jumped 0.14% to a near 6-month high today on the back of a solid session on Wall Street overnight buoyed by the latest FOMC minutes outlining that it may be appropriate soon for the Fed’s to slow down their aggressive rate hikes. Tech stocks was the best performing sector, while gold miners also led the charge today amid a rise in the price of the precious commodity.
Qantas Airways (ASX:QAN) shares came off in afternoon trade following reports that the company’s domestic flight attendants have demanded the airline lift a two-year staff wage freeze or face the threat of attendants walking off the job during the Christmas rush. Nick Scali (ASX:NCK) shares soared over 10% today as investors responded to the furniture retailer’s AGM trading update outlining the company is performing materially better than expected in H1FY23 with revenues up 74% on the same period a year earlier. The company also expects first half profit to be between 56% to 66% above that of H1 FY22.
AGL Energy (ASX:AGL) shares took a hit today as investors responded to the company’s announcement today revealing it has decided to close the power Torrens Island B Power station in South Australia on the 30th June 2026 after 50-years of operation. The AGL management team doesn’t expect the closure announcement to have a material impact on earnings in FY23 nor does it expect the closure to have long term impact.
The winning stocks for today’s session were St Barbara (ASX:SBM) up over 9%, BrainChip Holdings (ASX:BRN) adding more than 8.5% and Evolution Mining (ASX:EVN) closing the day up 6.6%. And on the losing end coal miners weighed on the key index today amid concerns over demand in China, with New Hope Corporation (ASX:NHC) tanking almost 9% today, while Whitehaven Coal (ASX:WHC) fell 6.65%.
The most traded stocks by Bell Direct clients today were Australian Foundation Investment Co (ASX:AFI), Northern Star Resources (ASX:NST), and Bellevue Gold (ASX:BGL).
Commodities are trading mixed this afternoon with crude oil down 0.24% to U$77.75 per barrel, and natural gas is down 1.53%, while gold is up 0.4% at US$1,755.86 an ounce, and iron ore is also up just over 1% at US$98 a tonne.
The Aussie dollar has strengthened to buy 67.61 US cents, 93.79 Japanese Yen, 56 British Pence and NZ$1.08.
Wall Street extended its rally into Wednesday after the latest FOMC minutes showed most policy makers expect a slowdown in interest rate hikes will ‘soon be appropriate’. For the first time though, the Federal Reserve staff said that a recession is possible in the next year, with some saying the Fed’s current action could exceed what was required to tackle the country’s 40-year high inflation. Trading volumes in the US have been lighter this week amid the Thanksgiving holiday on Thursday. The Dow Jones rose 0.28%, the Nasdaq added 1% and the S&P500 rallied 0.6%.
Over in Europe, markets closed slightly higher as investors awaited the release of the Fed’s FOMC minutes in afterhours trade. The STOXX600 rose 0.6%, Germany’s DAX rose just 0.04% and the French CAC added 0.32%.
In the UK the FTSE100 closed the midweek session almost 0.2% higher.
What to watch today:
- Ahead of the local trading session the SPI futures are anticipating the ASX to open just 0.06% higher as the global rally continued overnight.
- On the commodities front this morning, crude oil is trading 4.48% lower at US$77.32 per barrel, gold is up 0.67% at US$1,751.95 an ounce, and iron ore is trading 0.51% lower at US$97 a tonne.
- The Aussie dollar has strengthened to buy 67.3 U.S. cents, 93.85 Japanese yen, 55.95 British pence and NZ$1.08.
- There is no local economic data out today, however eyes will be on New Zealand’s market today after the reserve bank of New Zealand delivered its highest ever rate hike yesterday of 75-bassi points taking the country’s cash rate to 4.25% in a bid to tackle inflation in the region.
Trading Ideas:
- Trading Central has identified a bullish signal on The Lottery Corporation (ASX:TLC) following the formation of a pattern over a period of 10-days which is roughly the same amount of time the share price may rise from the close of $4.56 to the range of $4.94-$5.02 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on GR Engineering Services (ASX:GNG) following the formation of a pattern over a period of 53-days which is roughly the same amount of time the share price may fall from the close of $2.03 to the range of $1.80-$1.86 according to standard principles of technical analysis.
Australian stocks rose from a second day, following a rebound in the US and European equity markets.
The ASX200 gained 0.7%, boosted by utilities, industrials and energy. All sectors, except technology and real estate, were trading in positive territory.
Today Qantas Airways (ASX:QAN) upgraded guidance amid strong travel demand, which saw its share price close 5.3% higher. Qantas lifted its profit forecast for the December half as rampant consumer demand continues to buoy the sector’s COVID-19 recovery, despite capacity restraints and inflated fuel costs. The airline is expecting to book between $1.35 billion and $1.45 billion in underlying profit before tax in the first half of its financial year. That’s up $150 million from a previous guidance given in October. Meanwhile, net debt is expected to fall more than previously predicted.
Technology stocks were mixed today, with WiseTech Global (ASX:WTC) falling 6.7% and was the worst performing stock on the ASX200, while BrainChip Holdings (ASX:BRN) gained 7% today, and was the best performing stock of the session.
The most traded stocks by Bell Direct clients today were Smartgroup Corporation (ASX:SIQ), New Hope Corporation (ASX:NHC), National Australia Bank (ASX:NAB) and BPH Energy (ASX:BPH).
The Australian dollar is buying US$0.66, 55.95 British Pence, 93.85 Japanese Yen and NZ$1.08.
Wall Street rallied on Tuesday as investors shift focus from China’s covid-lockdowns to a number of strong earnings reports due out in the short trading week including from Nordstrom and HP Inc. The Dow Jones industrials index closed 1.16% higher, the tech-heavy Nasdaq added 1.25%, and the S&P500 rose 1.30%. Investors are keenly focused on a number of Fed official speeches this week, particularly on Wednesday, in hope of gaining an insight into future rate hike movements. Tesla shares hit the lowest level since July 2020 to start the week, amid a tech sell-off, however shares in the electric vehicle maker have been sold-off since the company’s CEO Elon Musk took over Twitter. Shares in Tesla are also being sold-off in line with China’s COVID lockdowns.
Over in Europe, markets closed higher on Tuesday driven by a rally for oil stocks after Saudi Arabia denied a report that OPEC+ may boost oil output. The STOXX 600 closed up 0.8%, Germany’s DAX added 0.29% and the French CAC rose 0.35%. And the UK’s FTSE 100 closed Tuesday’s session up 1.03%.
What to watch today:
- On the commodities front this morning, it’s a mixed bag as crude oil trades 2.29% higher at US$81.89 a barrel, natural gas is up 0.23%, gold is flat at US$1,739 an ounce and iron ore is down 2.01% at US$97.50 a tonne.
- Ahead of the local trading session, the SPI futures are expecting the ASX to open 0.74% higher on the back of the rally on Wall Street overnight.
- After the closing bell yesterday, RBA governor Philip Lowe spoke at the annual Ceda dinner outlining that the inflation we are feeling right now was the same high inflation that was felt in the 70s and 80s that damaged the economy and hurt our standards, which Mr Lowe is wary of allowing to happen again, therefore warned Aussies to brace for higher inflation and lower growth, fewer jobs and lower real wages. All in all Mr Lowe reiterated the RBA’s need to continue raising interest rates in order to curb the current period of high inflation and that they are not ruling out further 50-basis point rate hikes if needed in future.
- Looking at economic data, Australia’s S&P Global services and manufacturing preliminary PMI data is out for November giving an insight into demand for private services and manufacturing production companies in Australia which has been declining since September as the RBA continues to raise interest rates to tackle the nation’s red-hot inflation. The Reserve Bank of New Zealand will also announce its latest cash rate hike this morning with the market expecting a hike of 75-basis points, with the nation accelerating its monetary tightening to control rising inflation.
- The Aussie dollar has strengthened to buy 66.34 US cents, 56.16 British Pence, 93.74 Japanese Yen and NZ$1.08.
Trading Ideas:
- Trading Central has identified a bullish signal on Cooper Energy (ASX:COE) following the formation of a pattern over a period of 30-days which is roughly the same amount of time the share price may rise from the close of $0.20 to the range of $0.27-$0.29 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Infomedia (ASX:IFM) following the formation of a pattern over a period of 34-days which is roughly the same amount of time the share price may fall from the close of $1.11 to the range of $0.78-$0.84 according to standard principles of technical analysis.
The ASX rebounded from Monday’s losses to close Tuesday’s session up 0.59% at a fresh 5-month high, with the gains largely driven by investors piling into the energy sector today amid the rising price of commodities.
Coal stocks rallied today as the price of the commodity surges 2.2% to US$351/tonne. Whitehaven Coal (ASX:WHC) jumped more than 7.5%, New Hope Corporation (ASX:NHC) rallied over 7% and Yancoal Australia (ASX:YAL) added more than 6%. Coal mining stocks also rallied after Origin Energy (ASX:ORG) warned the coal exit could be delayed globally.
As we head into the Black Friday sales, Australian Retailers Association and Roy Morgan are forecasting sales will reach a record $6.2bn over the four-day period from Friday to Monday, with most Aussies in the survey saying they will spend the same or more than last year despite rising interest rates.
Star Entertainment shares fell almost 2% today after the company released a trading update at its AGM outlining revenues have fallen 11% in Sydney from July to November 2022, giving an idea of the impact competitor Crown’s new Barangaroo casino has on Star’s performance in NSW.
The winning stocks today were led by Virgin Money UK (ASX:VUK) climbing more than 10% after releasing full year results including a 43% increase in statutory profit before tax and an interest margin of 1.85%. Whitehaven Coal (ASX:WHC) soared almost 8% today and New Hope Corporation (ASX:NHC) also added more than 7% today.
And the stocks that weighed on the market today were Block Inc (ASX:SQ2) tumbling 3.22%, De Grey Mining (ASX:DEG) closing down 2.34% and Inghams (ASX:ING) shedding 2.15%.
The most traded stocks by Bell Direct clients were Fortescue Metals Group, Appen and Lake Resources.
Taking a look at commodities, crude oil is trading flat at US$80.05/barrel, natural gas is down 3.2%, gold is up 0.3% at US$1743/ounce and iron ore is down just over 2% at US$97.50/tonne.
The Aussie dollar has slightly strengthened today to buy 66.08 US cents, 55.95 British Pence, 93.78 Japanese Yen and 1 New Zealand dollar and 8 cents.
RBA governor Philip Lowe will address the Annual Ceda dinner tonight and is poised to talk about price stability, the supply side and prosperity.
US equities closed the first session of the week in the red. The Dow Jones down 0.2% and the S&P500 down 0.4%, while the Nasdaq dropped a little over 1%. And this week is a short trading week on Wall Street due to the Thanksgiving holiday. Fears that China may again enforce COVID restrictions after reporting deaths from the virus, weighed on markets overnight, and sent energy stocks and oil prices lower.
European markets also closed lower, as investors continue to assess inflationary pressures. The STOXX 600 closed flat, Germany’s DAX down 0.4%, the French CAC down just 0.2%, while in the UK the FTSE100 closed down just 0.1%.
What to watch today:
- Despite the losses across overseas markets, the SPI futures are suggesting the Australian market will rise 0.4% at the open this morning.
- In economic data, the RBA Governor Phillip Lowe is set to give a speech at 6pm tonight.
- And in commodities, the oil price is steady after falling over 5% to its lowest level since January, after Saudi Arabia denied news of a potential oil output increase. The gold price continues to weaken, falling for the fourth straight session. While iron ore is trading more than 2% higher at US$99.50 per tonne, its highest level in eight weeks, and advancing 22% since the start of the month.
Trading Idea:
- Bell Potter have initiated coverage on Cedar Woods Properties (ASX:CWP) with a Buy rating. CWP is a medium sized Australian property developer that operated in four Australian states, with around half of its operations in WA. The main business model is to buy land, seek approvals to develop, then either subdivide and sell the land, or build apartments and townhouses. Rising interest rates have had an impact on sentiment and the share price. Bell Potter price target on CWP is $5.40, and at the stock’s current share price of $4.04, this implies 33.7% share price growth in a year.
The local market rallied in the opening hour of trade before declining throughout the first trading session of the week to end the day down 0.18% as investors sharply sold out of materials, energy and information technology stocks today. Utilities stocks led the market gains, with the sector adding 1.77% at the closing bell today.
Lake Resources (ASX:LKE) shares rallied today after the lithium developer announced it has resolved a dispute with earn-in partner Lilac Solutions over Lilac’s delivery of services at the company’s Kachi lithium project in Argentina.
NIB Holdings (ASX:NHF) shares also jumped today after the company’s CEO Mark Fitzgibbon said the health insurer is starting to see an uptick in customers switching due to competitor Medibank’s privacy and data breach.
The winning stocks for today’s session were AGL Energy (ASX:AGL) climbing 4.23%, Atlas Arteria (ASX:ALX) adding 3.76% and Whitehaven Coal (ASX:WHC) rallying almost 3.2%. And on the losing end, Nanosonics (ASX:NAN) tanked 12.23% today as brokers including Goldman Sachs responded negatively to the company’s recent trading update. Sayona Mining (ASX:SYA) fell 4.55% today and Novonix (ASX:NVX) ended the day down 4.5%.
The most traded stocks by Bell Direct clients today were Fortescue Metals Group (ASX:FMG) , APA Group (ASX:APA) and CSL (ASX:CSL)
Commodities are still trading as a mixed bag this afternoon, with crude oil down 1.31% at US$79.06/barrel, gold is down just 0.2% at US$1746.56/ounce, while iron ore is up 2.05% at US$99.50/tonne. The decline in the price of oil impacted mining giants like Woodside today, with the oil and gas giant closing Monday’s session down 1.29%.
The Aussie dollar is trading slightly weaker this afternoon, buying 66.57 US cents, 56.14 British Pence, 93.43 Japanese Yen and 1 New Zealand dollar and 8 cents.
Asian equities had a tough start to the week today with markets closing lower amid a rise in COVID-related deaths and case numbers in China and Hong Kong prompting authorities to tighten restrictions in some areas of the region.
The local market closed 0.23% higher on Friday driven by a surge in materials stocks on the back of OZ Minerals (ASX:OZL) announcing it has received and intends to accept a revised takeover offer from BHP Group (ASX:BHP) for $28.25 per share, in a deal worth $9.6 billion. The consumer discretionary, real estate and energy sectors closed Friday’s session in the red.
The best performing stocks on Friday were led by OZ Minerals (ASX:OZL) following the takeover update, Coronado Global Resources (ASX:CRN) added 3.54% and NIB Holdings (ASX:NHF) rounded out the top 3 winning stocks for the session, up 3.2% on Friday. Lovisa Holdings (ASX:LOV) led the losing end of the market on Friday, tumbling more than 7% after releasing a trading update despite the fashion jewellery company announcing store sales for the first 19-weeks of FY23 are up 16.1% on FY22 YTD.
Pinnacle Investment Management also fell almost 4.45%, and Corporate Travel Management lost 3.75% on Friday.
The most traded stocks by Bell Direct clients on Friday were APA Group (ASX:APA), Westpac Banking Corporation (ASX:WBC) and James Hardie Industries (ASX:JHX).
Overseas, Wall Street rallied to see out the last trading week despite US retail data out during the week alongside speeches by some policymakers still indicating the Fed’s hawkish approach remains the priority. Investors however may be slightly more confident that a Fed pivot will come sooner than expected and that rate cuts may be seen by around the end of next year. The Dow Jones industrials index ticked 0.6% higher at the closing bell on Friday, while the Nasdaq added just 0.01% and the S&P500 rallied 0.5%.
European markets rebounded on Friday as investors responded to lower-than-expected consumer and wholesale data released last week, in signs that boost investor confidence that the U.S. Fed’s will have to ease the aggressive rate hike path soon. The STOXX600 added 1.1%, Germany’s DAX rallied 1.16%, the French CAC jumped 1.04% and, in the UK, the FTSE100 rose just over half a percent.
What to watch today:
- Ahead of the local trading session on the ASX, the SPI futures are anticipating the market to open 0.33% higher amid signs inflation is beginning to cool.
- There is no local economic data being released today however investors will be awaiting RBA governor Philip Lowe’s speech tomorrow in hope of gauging any insight into the RBA’s rate hike movements over the coming months.
- On the commodities front this morning, crude oil is trading 1.91% lower at US$80.80 per barrel, gold is down 0.61% at US$1750 per ounce and iron ore is up 2.05% at US$99.50 per tonne.
- The Aussie dollar is starting the week slightly weaker at 66.59 US cents, 93.68 Japanese yen, 56.14 British Pence, and NZ$1.08.
Trading Ideas:
- Trading Central has identified a bullish signal on Steadfast Group (ASX:SDF) following the formation of a pattern over a period of 12-days which is roughly the same amount of time the share price may rise from the close of $5.19 to the range of $5.59 to $5.69 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Universal Biosensors (ASX:UBI) following the formation of a pattern over a period of 37-days which is roughly the same amount of time the share price may rise from the close of $0.26 to the range of $0.32 to $0.34 according to standard principles of technical analysis.
The Aussie share market declined 0.31% this week (Mon-Thu), however there were some positives. The materials sector rose after China announced the easing of its COVID-zero goal, as well as a property rescue package.
In this week's wrap, Sophia covers:
- (0:12) Why mining stocks advanced this week
- (0:26) Whether Chinese steel mills can return to profit
- (1:20) The current outlook for iron ore prices
- (1:59) The best performing stocks on the ASX200
- (2:45) The most traded stocks & ETFs by Bell Direct clients
- (3:20) Three economic news items to watch out for
Rising yields sparked recession fears overnight, which saw US equities close in the red. The Dow Jones down 0.3%, the S&P500 down 0.6% and the Nasdaq down 0.7%. While stocks fell, bond yields jumped higher, after the Fed signalled the rate hikes will continue, as they aim to tame inflation.
In Europe, investors digested geopolitical tensions and the UK budget. The UK finance minister Jeremy Hint announced his latest fiscal statement, which included billions of pounds worth of spending cuts and tax hikes. Also, global markets continue to watch the developments in Ukraine after a missile hit Polish territory. The STOXX600 closed down 0.4%, after fluctuating between marginal gains and losses in early trade. Germany’s DAX closed up 0.2%, while the FTSE100 closed flat and France’s CAC ended the session 0.5% lower.
What to watch today:
- The Australian market is set to open flat this morning, according to the SPI futures.
- In commodities,
- The price of oil has dropped over 4% and is hovering around US$82 per barrel, extending losses from the previous session.
- Gold is also in the red foe the second straight session, after the US dollar was buoyed by stronger than expected US retail sales data. The data clouded the inflation outlook by indicating a need for more interest rate hikes.
- Iron ore is trading over 2% higher at US$99 per tonne, the highest in seven weeks, amid hopes of strong demand from China, which is of course a top consumer.
- The a2 Milk Company (ASX:A2M), Lendlease (ASX:LLC), NEXTDC (ASX:NXT) and Mirvac Group (ASX:MGR) are set to hold its AGM today.
- Stocks going ex-dividend today include Coronado Global Resources (ASX:CRN) and Orica (ASX:ORI).
Trading Ideas:
- Bell Potter have upgraded their rating on the Australian Agricultural Company (ASX:AAC) from a Hold to a Buy, after the company reported H1 operating EBITDA ahead of Bell Potter’s expectations at $38.3 million. They say the company have an effective go to market strategy and cost controls and are in a position to develop the asset base and add value to the portfolio. Bell Potter have lowered their price target from $2.35 to $2.15, and at its current share price of $1.63, this implies 31.9% share price growth in a year.
- Trading Central have identified a bullish signal in Steadfast Group (ASX:SDF) indicating that the stock price may rise from the close of $5.19 to the range of $5.59 to $5.69 over 12 days according to the standard principles of technical analysis.
The local market followed in the footsteps of Wall Street today, closing the second last trading session of the week down 0.2%, amid the release of unemployment data showing a decline in the country’s unemployment rate, which was a result vastly different to what economists’ were expecting. Consumer staples was the leading sector today, while the energy sector weighed down on the market.
The big story of was Perpetual (ASX:PPT) shares falling 13% today, while Pendal (ASX:PDL) shares jumped more than 10% during the session, after the NSW Supreme Court ruled Perpetual could face costly penalties if it walks away from the planned transaction to buy out rival Pendal, in favour of pursuing a buyout of its own, by BPEA and Regal Partners. The court ordered that the ‘break fee’ of $23 million would not be an exclusive remedy for Perpetual to pay, if it walked away, and that Pendal could see orders to enforce Perpetual’s obligations to complete the scheme.
The winning stocks today were Pendal (ASX:PDL), Webjet (ASX:WEB) and Fisher and Paykel (ASX:FPH). And on the losing end, Perpetual (ASX:PPT) declined the most, followed by New Hope Corporation (ASX:NHC) and Whitehaven Coal (ASX:WHC).
The most traded stocks by Bell Direct clients today were National Australia Bank (ASX:NAB), Terracom (ASX:TER) and Argosy Minerals (ASX:AGY).
Australia’s jobless rate declined 0.1% to 3.4% in October, the lowest level since the mid-1970s, defying economists’ expectations of an increase in unemployment. Around 32,000 jobs were added to the Australian economy in October and seasonally adjusted monthly hours worked increased by 2.3% reflecting fewer employed people than usual taking leave during October. Floods across NSW, Victoria and Tasmania saw more people working reduced hours though due to the bad weather events.
On the commodities front, oil has dropped 1.5% and is currently trading at US$84 per barrel. Gold is also in the red at US$1,762 an ounce, while iron ore has jumped more than 2% to US$99 per tonne.
And the Aussie dollar is buying 67 US cents, 56.93 British Pence, 93.57 Japanese Yen and NZ$1.09.
Wall Street closed lower on Wednesday after US retail sales figures came in at 1.3% for October which was higher than expectations, after levelling off in September, indicating consumers are still spending despite interest rates being aggressively hiked month on month. The Dow Jones closed flat, the S&P500 fell 0.71%, and the Nasdaq ended the session down 1.51%. Yesterday, former US President Donald Trump also announced he will be running for the Republican presidential nomination in 2024, nearly 2-years after allegedly inspiring the deadly Capitol riot. The hotter than expected retail figures come despite Target warning of weaker consumer demand to come and that the department store giant had instilled a multi-billion-dollar cost-cutting plan which sent shares in the company down 13% on Wednesday.
Over in Europe, markets also closed lower as geopolitical tensions rise in the wake of escalating tensions between Russia and Ukraine. The STOXX600 fell 1%, Germany’s DAX lost 1% and the French CAC shed half a percent. In the UK the FTSE100 also closed 0.25% lower on Wednesday.
What to watch today:
- Ahead of the local trading day, the SPI futures are expecting the ASX to open Thursday’s session 0.14% lower.
- In commodities, crude oil is trading 1.40% lower at US$85.70 per barrel, gold is trading 0.3% lower at US$1773 per ounce, and iron ore is trading flat at US$97 per tonne.
- The Aussie dollar has weakened overnight to buy 67.33 US cents, 56.93 British pence, 93.87 Japanese yen and NZ$1.10.
- Investors will be awaiting the release of Australia’s unemployment rate data for October, which is released at 11:30am AEDT.
Trading Ideas:
- Trading Central has identified a bullish signal on NEXTDC (ASX:NXT) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $9.27 to the range of $10.10 - $10:30 according to standard principles of technical analysis.
- Bell Potter has maintained its Buy rating on Nufarm (ASX:NUF) and raised its price target from $6.75 to $7.15 due to the agricultural chemical company releasing strong FY22 results despite facing headwinds of deregistration’s in Europe and dry conditions across the Mediterranean and North America in the second half of FY22.
Wall Street closed lower on Wednesday after US retail sales figures came in at 1.3% for October which was higher than expectations, after levelling off in September, indicating consumers are still spending despite interest rates being aggressively hiked month on month. The Dow Jones closed flat, the S&P500 fell 0.71%, and the Nasdaq ended the session down 1.51%. Yesterday, former US President Donald Trump also announced he will be running for the Republican presidential nomination in 2024, nearly 2-years after allegedly inspiring the deadly Capitol riot. The hotter than expected retail figures come despite Target warning of weaker consumer demand to come and that the department store giant had instilled a multi-billion-dollar cost-cutting plan which sent shares in the company down 13% on Wednesday.
Over in Europe, markets also closed lower as geopolitical tensions rise on the back of Russia’s missile attack aimed at Ukraine that hit Polish territory killing two people. The attack raises tensions between Russia and NATO as the missiles hit Poland. The STOXX600 fell 1%, Germany’s DAX lost 1% and the French CAC shed half a percent. In the UK the FTSE100 also closed 0.25% lower on Wednesday.
What to watch today:
- Ahead of the local trading day, the SPI futures are expecting the ASX to open Thursday’s session 0.14% lower.
- In commodities, crude oil is trading 1.40% lower at US$85.70 per barrel, gold is trading 0.3% lower at US$1773 per ounce, and iron ore is trading flat at US$97 per tonne.
- The Aussie dollar has weakened overnight to buy 67.33 US cents, 56.93 British pence, 93.87 Japanese yen and NZ$1.10.
- Investors will be awaiting the release of Australia’s unemployment rate data for October, which is released at 11:30am AEDT.
Trading Ideas:
- Trading Central has identified a bullish signal on NEXTDC (ASX:NXT) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $9.27 to the range of $10.10 - $10:30 according to standard principles of technical analysis.
- Bell Potter has maintained its Buy rating on Nufarm (ASX:NUF) and raised its price target from $6.75 to $7.15 due to the agricultural chemical company releasing strong FY22 results despite facing headwinds of deregistration’s in Europe and dry conditions across the Mediterranean and North America in the second half of FY22.
Investor concerns over Russia’s war with Ukraine escalating caused the sell-off on the ASX today, with the key index closing the midweek session 0.27% lower amid a Russian missile strike pounding Ukraine’s energy facilities and Poland with its biggest barrage of missiles yet, according to reports. The mining giants offset some of the sessions’ losses with BHP Group (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals Group (ASX:FMG) rallying over 1% today on hopes that China’s property rescue plans will reignite demand for steel. The utilities and consumer discretionary sectors were the worst performing today.
Oz Minerals (ASX:OZL) entered a trading halt today in relation to a potential change of control transaction. Back in August, BHP (ASX:BHP) made a takeover offer for $25 per share that Oz Minerals rejected on the grounds of ‘undervaluing’ the company, so today’s trading halt has the market guessing BHP could be back with a revised offer, however neither company has yet confirmed this is the case.
The winning stocks for today’s session were led by Nufarm (ASX:NUF) lifting almost 9% after the agricultural chemical company released its full year results including a 24% increase in EBITDA to $447 million on revenue up 17% to $3.8 billion. Sandfire Resources (ASX:SFR) rallied 6.7% today and Whitehaven Coal (ASX:WHC) jumped 5.83%. On the losing end, Imugene (ASX:IMU) tumbled almost 10% today, while De Grey Mining (ASX:DEG) fell 9.2% and St Barbara (ASX:SBM) ended the day down just over 7%.
The most traded stocks by Bell Direct clients today were Argosy Minerals (ASX:AGY), Core Lithium (ASX:CXO), and Lake Resources (ASX:LKE).
On the commodities front today, crude oil is trading 0.84% lower at US$86.18 per barrel, gold is down 0.23% at US$1774 per ounce and iron ore is trading flat at US$97 per tonne.
The Aussie Dollar is buying 67.58 US cents, 56.98 British Pence, 94.53 Japanese Yen and 1 New Zealand Dollar and 10 cents.
Australia’s wage price index data released today showed the seasonally adjusted WPI rose 1% in the September quarter and 3.1% over the year, while the private sector rose 1.2% or double that of the public sector which rose 0.6%. Average private sector pay rises hit 4.3%, the highest quarterly growth in hourly wages recorded since March quarter 2012.
The US markets rebounded on Tuesday to close higher across the key indices following the release of US producer price index data that measures wholesale inflation, for October showing an increase of just 0.2% which was below market expectations and is another sign inflation is slowing in the region. The tech-heavy Nasdaq led the gains adding 1.27% on Tuesday, while the Dow Jones and S&P500 also each lifted 0.02% and 0.7% respectively. Over in the US it has been a turbulent time for technology stocks of late with interest rates rising meaning financing growth becomes more expensive. As a result, we have seen mass lay-offs from tech giants including Twitter cutting around 3700 jobs, Amazon reportedly releasing 10,000 employees, Stripe axing 14% of its staff and Meta cutting 11,000 jobs in the biggest tech layoff of 2022, so today’s rally on the Nasdaq will bring a brief relief for tech stocks.
Over in Europe, markets advanced on the back of that US producer price index data being released, with the STOXX 600 adding 0.2%, while Germany’s DAX and the French CAC each added almost 0.5%. In the UK, the FTSE100 bucked the trend, closing the day down 0.21%, amid UK property data indicating new homebuyer enquiries plunged in October to the lowest level since the 2008 GFC, according to the latest RICS housing surveyors report for the last week, adding to further fears of a deep recession to come.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open just 0.04% higher on the back of the rally on Wall Street.
- In commodities, crude oil is trading slightly higher this morning, up 0.68% to US$86.45 per barrel, gold is trading mostly flat at US$1772 per ounce, natural gas is up 2.68%, and iron ore is continuing to surge, up 3.74% this morning at US$97 per tonne.
- There is no local economic data out today however investors will be tuning in to a number of key Federal Reserve speeches in attempt of gaining a glimpse at how aggressive the Fed’s will continue raising interest rates moving forward.
- The Aussie dollar has strengthened overnight to buy 67.75 US cents, 57 British Pence, 94.44 Japanese Yen and NZ$1.10.
Trading Ideas:
- Trading Central has identified a bullish signal on Mach7 Technologies (ASX:M7T) following the formation of a pattern over a period of 18-days which is roughly the same amount of time the share price may rise from the close of $0.56 to the range of $0.64 to $0.66 according to standard principles of technical analysis.
- Trading Central has identified also identified a bullish signal on Magnis Energy Technologies (ASX:MNS) following the formation of a pattern over a period of 36-days which is roughly the same amount of time the share price may rise from the close of $0.42 to the range of $0.47 to $0.49 according to standard principles of technical analysis.
The local market extended its decline on Tuesday, closing the session down just 0.07% as investor confidence has been dampened in recent days by Fed officials warning that higher interest rate hikes are to be expected despite inflation in the US slowing. Lithium miners took a hit today on the back of a poor trading session on Monday for US lithium stocks despite the price of lithium remaining strong. The decline in lithium stocks today may be due to investors taking profits from the recent rally in lithium stocks, or the market moving away from higher risk stocks amid the expectation for higher interest rate hikes to come in the US despite inflation starting to cool. Core Lithium (ASX:CXO), Pilbara Minerals (ASX:PLS) and Allkem (ASX:AKE) each fell more than 8% on Tuesday.
The technology sector rallied today, offsetting some of the losses weighing on the market in the REIT and materials sectors.
The winning stocks of the session today were, Imugene (ASX:IMU) adding 7.7%, Incitec Pivot (ASX:IPL) rallying 5.88% and Elders (ASX:ELD) closing the session up 4.7%. On the losing end, Core Lithium (ASX:CXO) fell almost 16% today amid weakness among lithium stocks and on the back of Macquarie downgrading Core Lithium (ASX:CXO) to a neutral rating. Allkem (ASX:AKE) also lost 12.36% in the lithium sell-off and Sayona Mining (ASX:SYA) closed the day down 9.62%.
The most traded stocks by Bell Direct clients today were Core Lithium (ASX:CXO), Pilbara Minerals (ASX:PLS) and MSL Solution (ASX:MSL), which rocketed 70% today after announcing it has received and accepted a takeover offer implying an equity value of $119 million.
All eyes were on the RBA’s meeting minutes from November released today which outlined that the RBA is not ruling out further rate hikes or a pause, it is keeping its options open to address inflation and is not on a set rate hike path.
On the commodities front today, crude oil is down 4.16% to US$85.175/barrel, natural gas is up 2.31% at US$6.07/MMbtu, coal is up 1.09% at US$330.35/ton, gold is trading down 0.05% at US$1770.94/ounce, and iron ore is up 3.74% at US$97/tonne.
The Aussie dollar has strengthened to buy 66.96 US Cents, 56.77 British Pence, 94 Japanese Yen and 1 New Zealand Dollar and 10 cents.
US stocks ended the first session of the week lower, taking a pause from last week’s big rally. The Dow closed 0.6% lower, the S&P500 down 0.9% and the Nasdaq fell 1.1%. Fed Governor Christopher Waller suggested at a conference in Sydney yesterday, that the market may have overreacted to last week’s CPI reading and said that policymakers still had “a ways to go” before the hiking cycle comes to an end.
European equities closed flat overnight, with the Stoxx 600 up just 0.1%, after struggling to break away from the flatline throughout the session.
What to watch today:
- The Australian market is set to open lower, with the SPI futures suggesting a fall of 0.52% at the open this morning.
- In economic data, today at 11:30am AEDT, the RBA will release its minutes from its November meeting. This won’t have much influence over markets however, it will provide us with insights into the meeting when the central bank decided to raise the cash rate to 2.85%, marking its seventh straight rate hike. Note that the RBA had also added that it now saw inflation peaking around 8% this year, compared with its previous forecasts of 7.75%.
- As for share prices to keep watch of today: Incitec Pivot (ASX:IPL) and United Malt Group (ASX:UMG) both are set to release their earnings results today.
- AGMs today: AGL Energy (ASX:AGL), Allkem (ASX:AKE), Genworth Mortgage Insurance (ASX:GMA) and Lifestyle Communities (ASX:LIC).
- National Australia Bank (ASX:NAB) is set to go ex-dividend today, so this may see its share price fall as investors take their profits.
Trading Ideas:
- Bell Potter maintain a Buy rating on Monash IVF Group (ASX:MVF), after the company’s AGM on Friday. MVF is tracking below Bell Potters H1 expectations, although the company has increased its market share in the key Australian markets over the first four months of the financial year. They have lowered their price target from $1.43 to $1.39, and at its current share price of $0.92, this implies 51.1% share price growth in a year.
- Trading Central have identified a bullish signal in Sayona Mining (ASX:SYA) indicating that the stock price may rise from the close of $0.26 to the range of $0.31 to $0.33 over 34 days, according to the standard principles of technical analysis.
The ASX slipped into the red in afternoon trade before closing the first trading session of the week down 0.16%, weighed down by a sharp sell-off in industrials stocks.
The materials sector rallied 3.4% today amid a surge for iron ore miners on the back of the price of iron ore surging 4.47% to US$93.50 per tonne overnight. Champion Iron (ASX:CIA) rose almost 13% and was the winning stock of today, while Fortescue Metals Group (ASX:FMG) added just over 10%, and BHP Group (ASX:BHP) lifted 4.56%. The other winning stocks to start the week were Core Lithium (ASX:CXO), which jumped 11.7% and Sims (ASX:SGM) which rose 6.9%.
The worst performing stocks today were led by Elders (ASX:ELD) plunging more than 23% after the Australian agribusiness released its full year results including operating cash flow down 28.5% to $113.7 million, a 35% jump in sales revenue to $3.445 billion and a 42% increase in underlying profit before tax of $223.5m. The company also increased its dividend by 33% on FY21 to 56cps. Shares in the company tanked today though after Elders CEO Mark Allison announced he would be retiring, bringing to an end his role as CEO after nearly 10-years, with his role as CEO ending on or before November 14, 2023. IPH (ASX:IPH) also dropped 6.56% today and Ramelius Resources (ASX:RMS) ended the session down 6.45%. Medibank’s (ASX:MPL) woes continued today with the health insurance provider revealing another 500 Medibank customers have had their medical records published to the dark web. Shares in Medibank fell 1.06% today.
The most traded stocks by Bell Direct clients today were Core Lithium (ASX:CXO), Lake Resources (ASX:LKE) and Pilbara Minerals (ASX:PLS).
There was no local economic data released today however investors will be awaiting the release of the RBA’s meeting minutes for November out tomorrow.
In commodities, crude oil has retreated to trade just 0.15% higher at US$89.09 per barrel, gold is down 0.54% at US$1761 per ounce and iron ore is up 4.47% at US$93.50 per tonne.
The Aussie dollar has slightly weakened to buy 66.75 US cents, 56.71 British Pence, 93.17 Japanese Yen and NZ$1.10.
The local market soared 2.8% on Friday following the release of US inflation data out late on Thursday that hit 7.7% for October, which indicates a slowing of economic growth in the US and prompted investors to believe that inflation has now peaked.
Investors piled into technology stocks which have been sold-off sharply of late as the cost of borrowing financing increases with every interest rate hike, which impacts the growth outlook of tech companies, but with markets now believing inflation in the US has peaked, investors piled back into growth stocks on Friday sending the tech sector up almost 5% in the last trading session of the week.
The best performing stocks on Friday were Megaport (ASX:MP1), which added just over 13.5%, Pinnacle Investment Management (ASX:PNI), which gained 12.5% and Netwealth Group (ASX:NWL), which rose 11.67%. On the other end of the market, the stocks that weighed on the market on Friday were Whitehaven Coal (ASX:WHC) losing almost 3.5%, Origin Energy (ASX:ORG) falling 3.2% and Computershare (ASX:CPU) closing the day down almost 3%.
The most traded stocks by Bell Direct clients were BHP Group (ASX:BHP), Argosy Minerals (ASX:AGY) and Nickel Industries (ASX:NIC).
Wall Street extended its rally into Friday with the key indices closing higher, buoyed by lower-than-expected inflation data released on Thursday indicating the Fed’s aggressive rate hikes to tackle the 40-year high inflation are starting to work. The Dow Jones added 0.1%, the S&P500 jumped 0.92% and the tech-heavy Nasdaq rose 1.88%.
Over in Europe, markets notched their best weekly performance in nearly 8-months on Friday, driven by hopes of smaller rate hikes by the Federal Reserve in the US and on the easing of some COVID-19 restrictions in China. The STOXX600 added 0.1%, Germany’s DAX lifted 0.56%, and the French CAC rose 0.58%. In the UK, the FTSE100 fell 0.78% as the sterling rose on the back of a smaller-than-expected contraction in Britain’s economy in data out on Friday.
What to watch today:
- Ahead of the local trading session, the SPI futures are expecting the local market to open 0.6% higher to start the new trading week.
- On the commodities front, crude oil is up 2.88% at US$88.96 per barrel, brent oil is up 2.52% at US$96.03 per barrel, gold is trading just under 1% higher at US$1771.08 per ounce and iron ore is up 4.47% at US$93.50 per tonne.
- The Aussie dollar has strengthened to buy 67.17 US cents, 56.71 British Pence, 93.03 Japanese Yen and 1 New Zealand Dollar and 10 cents.
- In economic data out today, there’s no local economic data out today, however investors will be keeping an eye out for the RBA meeting minutes for November released tomorrow.
Trading Ideas:
- Trading Central has identified a bullish signal on Zip Co (ASX:ZIP) following the formation of a pattern over a period of 26-days which is roughly the same amount of time the share price may rise from the close of $0.74 to the range of $0.85 to $0.87 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on QUBE Holdings (ASX:QUB) following the formation of a pattern over a period of 8-day which is roughly the same amount of time the share price may rise from the close of $2.77 to the range of $3.02-$3.08 according to standard principles of technical analysis.
The Aussie share market gained 1.04% this week (Mon-Thu), as investor sentiment was buoyed by recovering commodity prices, early reports of China easing its COVID-zero goal, and the anticipated results of the US midterm elections.
In this week's wrap, Grady covers:
- (0:36) The shift in investments from equities to cash or term deposits
- (1:07) The big banks' corporate earnings
- (4:12) The best performing stocks on the ASX200
- (5:40) The most traded stocks & ETFs by Bell Direct clients
- (6:10) Three economic news items to watch out for
US equities surged to session highs in the final hour of trading overnight, after October’s reading of consumer prices raised investor hopes that inflation has peaked. US CPI rose just 0.4% for the month and 7.7% from a year ago, its lowest annual increase since January. And core CPI, where volatile food and energy costs are excluded, increased 6.3% on an annual basis, which was also less than expected.
The Dow Jones jumped more than 1,100 points or 3.4%. This was the Dow’s largest one-day increase since stocks came out of the pandemic bear market in 2020. The S&P500 closed 5.2% higher, which was its biggest one-day rally since April 2020. And the Nasdaq gained 6.7%. A really positive session overnight, as investors took the data as a sign the worst of high inflation may finally be behind us.
What to watch today:
- The Australian market is set to finish the week nicely, with the SPI futures suggesting the market will rise 2.31% at the open this morning.
- In commodities, oil is slightly higher and starting to regain the week’s losses, after losing more than 7% in the past three sessions. Gold has jumped almost 3% higher, after the inflation reading pushed the dollar higher. And iron ore is trading 0.6% higher at US$91.50 per tonne.
- Accent Group (ASX:AX1) is set to hold its AGM today.
Trading Ideas:
- Bell Potter maintain a Buy rating on Pendal (ASX:PDL). They say the short-term driver of Pendal’s share price is almost certainly whether PDL will be acquired by Perpetual (ASX:PPT). And this is currently in balance. PPT management have rejected the approaches so far from Regal Partners (ASX:RPL), however PPT’s share price is just under $33, which implies the market expects a higher offer, from another company perhaps, with a good chance of success. Bell Potter say that financial logic would point to the $33 per share in cash offered by the consortium for PPT. However, this offer looks opportunistic and driven by sell off in PPT’s share price down to $23 in October. When comparing PPT’s historic enterprise value over EBITDA ratio, the $33 offered is not a massive premium in Bell Potter’s opinion. They have reduced their price target from $5.90 to $4.90 and at its current share price of $3.91, this implies 25.3% share price growth in a year.
- Trading Central have identified a bearish signal in JB Hi Fi (ASX:JBH) indicating that the stock price may fall from the close of $42.12 to the range of $35.25 to $36.75 over 28 days, according to the standard principles of technical analysis.
The local market’s green run came to an end on Thursday, with the key index closing 0.5% lower, as investor sentiment was dampened by the global sell-off from overnight on the back of tighter than expected results from the midterm US election. The ASX see-sawed throughout the session before closing lower, weighed down by sharp sell-offs in the energy, metals and mining and resources sectors. The utilities sector rocketed more than 13% today after Origin Energy (ASX:ORG), one of Australia’s leading energy companies, soared 34% after receiving a takeover offer worth $18.4 billion from Brookfield Asset Management and MidOcean Energy. The offer for $9 per share is the third revision of the initial offer the takeover partners first approached Origin with. Unsurprisingly, Origin Energy was the winning of today’s session.
It was a big day on the M&A front with fund manager Perpetual (ASX:PPT), also gaining over 12% after announcing it has received an improved takeover offer from the consortium comprising BPEA and Regal Partners, for $33 per share, which has been rejected by Perpetual’s board as the company determines the offer ‘continues to materially undervalue the company’.
Invictus Energy (ASX:IVZ) bucked the trend of the energy sector sell-off today, surging almost 150% after the upstream oil and gas company released a positive drilling update from its Mukuyu-1 well that is currently being drilled at the company’s 80%-owned SG 4571 licence in Zimbabwe’s Cabora Bassa Basin.
The winning stocks from today’s session were led by Origin Energy (ASX:ORG), followed by Perpetual (ASX:PPT) adding 14.82%, and News Corp (ASX:NWS) rallying 8.72%. And on the losing end, investors sold out of Pendal Group (ASX:PDL) fell 10.93% amid Perpetual’s requested delay to its acquisition of Pendal. Xero (ASX:XRO) also fell 10.85% today after releasing a first half trading update that missed expectations, and Block Inc (ASX:SQ2) fell 5.7% today.
The most traded stocks by Bell Direct clients today were Mineral Resources (ASX:MIN), New Hope Corporation (ASX:NHC) and Whitehaven Coal (ASX:WHC).
The Aussie Dollar is buying 64.22 US cents, 56.66 British Pence, 93.85 Japanese Yen and 1 New Zealand Dollar and 9 cents.
In economic data out today consumer inflation expectations data in Australia for November came in at an increase to 6% which beat the market forecast of a decline to 5.1%. Tonight, investors will be awaiting the release of core inflation data for October out of the US with the market expecting a decrease to 6.5% from 6.6% in September.
Wall Street ticked lower on Wednesday after the midterm election results came in tighter than expected. It was widely predicted that a “red wave” of Republican victories would be announced after Tuesday’s vote, however early results are showing the Democrats are performing better than expected in the poll, with the control of congress still hanging in the balance. The Dow Jones closed the midweek session 1.5% lower, the S&P500 fell 1.68% and the tech-heavy Nasdaq fell 2.12%.
Over in Europe markets closed lower as global investors await the final outcome of the midterm US election. The STOXX600 closed 0.3% lower, Germany’s DAX ended Wednesday’s session down 0.16%, the French CAC fell 0.17% and in the UK the FTSE100 closed 0.14% lower on Wednesday. European markets are still being moved by earnings season with Germany’s second biggest bank Commerzbank reporting yesterday that its net profit dropped by 52% in the third quarter and the company maintained its full-year profit outlook despite soaring inflation in the country.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open 0.64% lower on the back of the global sell-off overnight
- On the commodities front, it’s a red run across the board this morning with crude oil trading 3.44% lower at US$85.85 per barrel, brent oil is down just over 3% at US$92.48 per barrel, gold is down 0.34% at US$1706.74 and iron ore is up 2.82% at US$91 per tonne.
- Taking a look at economic data out today, it’s a data dump on Australia’s building front with building permits data for September out at 11:30am AEDT and private house approvals data also out just before lunchtime.
- The Aussie dollar has weakened to buy 64.31 US cents, 56.35 British pence, 94.26 Japanese yen and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Trading Central has identified a bullish signal on The Lottery Corporation (ASX:TLC) following the formation of a pattern over a period of 35-days which is roughly the same amount of time the share price may rise from the close of $4.47 to the range of $4.78 to $4.86 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Ridley Corporation (ASX:RIC) following the formation of a pattern over a period of 49-days which is roughly the same amount of time the share price may fall from the close of $2.14 to the range of $1.81 to $1.87 according to standard principles of technical analysis.
The following Wall Street closing higher again overnight before the midterm election results, the Australian market climbed for the fourth consecutive day. The rebound in metal prices lifted miners with gold stocks leading the group. St Barbara (ASX:SBM) and Regis Resources (ASX:RRL) soared higher, while energy stocks were dragged down by the fall in the oil price amid China demand worries. Whitehaven Coal (ASX:WHC) dropped more than 9%, weighing on other coal miners as well, as it cut full year guidance after being impacted by La Nina.
Sectors that have gained the most are materials, real estate and the financials, while the other 5 industry sectors closed in the red.
Miners boosted the market today. The best performers following St Barbara (ASX:SBM) and Regis Resources (ASX:RRL), were De Grey Mining (ASX:DEG), Evolution Mining (ASX:EVN) and Perseus Mining (ASX:PRU). The worst performing stocks were News Corp (ASX:NWS) and Whitehaven.
The most traded stocks by Bell Direct clients today were ANZ, Westpac (ASX:WBC) and PayGroup (ASX:PYG).
The Australian dollar is buying 65 US cents, 56.43 British Pence, 94.68 Japanese Yen and NZ$1.09.
The US markets extended the green run this week into Tuesday as investors anticipate the midterm election results, expecting Republicans to take back the House of Representatives and possibly win the Senate as well, which could impact government spending and regulation. The Dow Jones industrials index added 1.36%, the S&P500 gained 0.97%, and the tech-heavy Nasdaq rallied 0.85%.
Over in Europe, markets closed higher as global investors looked to the US where the midterm elections are dominating headlines. The STOXX600 rallied to close Tuesday’s session 0.78% higher, while Germany’s DAX added 1.15% and the French CAC closed the session up 0.39%. In the UK, the FTSE100 added just 0.08% at the closing bell on Tuesday which was a recovery from a sell-off early in the session. The morning sell-off was sparked by British Retail Consortium figures showing UK retail sales growth slowed in October to 1.2% YoY compared to 1.8% in September which dampened investor sentiment.
What to watch today:
- In commodities, it’s been a mixed week across the board with commodities moving with investor sentiment around China’s COVID zero goal updates. This morning, crude oil is trading 1.32% lower at US$90.57 per barrel, natural gas is down 10.54%, gold is trading up 2.32% at US$1712 per ounce, and Iron ore is down 0.56% at US$88.50 per tonne.
- Ahead of the local trading day the SPI futures are expecting the local market to open 0.73% higher on the back of a strong session on Wall Street so far on Tuesday.
- The Aussie dollar has strengthened to buy 64.5 US cents, 56.25 British Pence, 95.07 Japanese Yen and 1 New Zealand Dollar and 9 cents.
- On the economic data front today, China’s inflation rate for October will be announced today with the market expecting the inflation in the region to have slightly cooled in October to 2.6% from 2.8% in September. High inflation is bad for markets and stock markets are forward looking. Inflation expectations have already been priced into current share prices so the risk for investors is that the inflation number comes in higher than expected and, if it does, then that is likely to put further pressure on share prices. With so much commentary on inflation right now, it’s important for listeners to look at what has already been priced in and new information that has not because that is where we will see movement.
Trading Ideas:
- Trading Central has identified a bullish signal on Telix Pharmaceuticals (ASX:TLX) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may rise from the close of $6.96 to the range of $8.10 to $8.40 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Infomedia Limited (ASX:IFM) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may fall from the close of $1.23 to the range of $1.02 to $1.06 according to standard principles of technical analysis.
The ASX extended its green run into Tuesday, closing the session up 0.36% buoyed by a surge in utilities and consumer staples stocks, however strong gains were offset by a sharp sell-off in the energy sector amid declining commodity prices with crude oil down 0.5% at US$91.31 per barrel, natural gas down 3.35%, gold down 0.24% at US$1670.66 per ounce and iron ore down 0.56% at US$88.50 per tonne.
Ingham’s (ASX:ING) shares fell more than 2% today after the poultry provider released its AGM presentation which outlined the challenging business conditions the company continues to face, including feed prices remaining elevated due to ‘tight global supply”. The Lottery Corporation (ASX:TLC) rallied today after the company reported overall group revenues rose 11% over the first four months of FY23. Magellan Financial Group (ASX:MFG) closed flat today after the company’s co-founder, Hamish Douglass, sold two-thirds of his shares in the company on Monday night. The share sale comes just days after MFG announced its funds under management increased to $51 billion in October.
COP27 kicked off today, where global leaders meet in Glasgow this year for the 2-week long global climate summit which on the summit’s opening day has already had the UN warn leaders that the world is speeding down a ‘highway to hell’.
The winning stocks for today’s session were Mineral Resources (ASX:MIN), Pilbara Minerals (ASX:PLS) and The a2 Milk Company (ASX:A2M). And the losing stocks today were led by James Hardie Industries (ASX:JHX) tanking more than 13.7% after the global building materials company announced first half results including the scrapping of the company’s dividend in favour of a share buyback program. Sims (ASX:SGM) lost almost 10% today and New Hope Corporation (ASX:NHC) fell 7.75%.
The most traded stocks by Bell Direct clients today were Lake Resources (ASX:LKE), Pilbara Minerals (ASX:PLS) and WA1 Resources (ASX:WA1).
In economic data out today, Westpac Consumer Confidence dropped to 78 for November from 83.7 in October as rising interest rates and surging inflation weigh on family finances and the economy. NAB’s Business Confidence data for October fell from 5 points in September to 0 in October, amid growing concerns over rising interest rates and an uncertain global outlook.
The Australian dollar has strengthened to buy 64.74 US cents, 56.25 British Pence, 94.83 Japanese Yen, and 1 New Zealand Dollar and 9 cents.
US equities had a positive run overnight, ahead of the US midterm elections, as well as key inflation data on deck over the next few days. Tonight, the midterm election will determine which party will control Congress, which currently, the House is controlled by Democrats. And on the economic front, investors are waiting on the consumer price index report out on Thursday. Stocks hit session highs in afternoon trade. The Dow Jones gained more than 400 points or 1.48%, the S&P500 gained 1.1% and the Nasdaq closed 1% higher.
In Europe the STOXX600 closed 0.3% higher, Germany’s DAX up 0.6%, the French CAC down 0.5% and in the UK the FTSE100 gained 0.9%.
What to watch today:
- Following the strong sessions in overseas markets, the Australian market is set to rise 0.6% at the open this morning, if you’re going by the SPI futures.
- Watch the share price movements of James Hardie Industries (ASX:JHX) and SSR Mining (ASX:SSR), as both companies are set to release a quarterly report today.
- AGMs today include Bendigo and Adelaide Bank (ASX:BEN), Inghams Group (ASX:ING), Sims (ASX:SGM), and Lottery Corporation (ASX:TLC).
- In commodities, oil is hovering at levels last seen in August, as investors weigh tight supply again a negative outlook for demand. The gold price has now steadied, following a 3% rally to 4-week highs in the previous session, after government officials backed rumours of China’s reopening. And iron ore has jumped 4.7% higher, rebounding from the three-year low of US$81.50 it hit on November 1st. Iron ore is now trading at US$89, amid hopes that China will transition away from its zero-COVID policy. So watch iron ore miners today like Champion Iron (ASX:CIA), BHP (ASX:BHP), Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG) or Mineral Resources (ASX:MIN).
- In economic data, today at 10:30am AEDT, Westpac will release its data on consumer confidence for November and NAB will release its data on business confidence for October.
Trading Ideas:
- Bell Potter maintain a buy rating on United Malt Group (ASX:UMG) and have lowered their price target to $3.90. At its current share price of $3.10, this implies 25.8% share price growth in a year.
- Bell Potter also maintain a buy rating on EROAD (ASX:ERD) and lowered their price target to $2.50. At its current share price of $1.20, this implies over 100% share price growth in a year.
The local market started the week in positive territory, closing Monday’s session up 0.6% driven by a surge in materials stocks amid a broad surge in commodity prices including iron ore jumping 4.71% to US$89 per tonne. Oil prices rallied in early trade before sharply declining after China indicated a relaxation of its COVID zero goal is not being considered yet. Crude oil fell 1.4% to US$91.31 per barrel, while brent crude dropped 1.17% to US$97.42 per barrel.
Medibank Private (ASX:MPL) confirmed today it will not pay the ransom asked to protect the stolen data of 9.7 million current and former customers, and the insurer also warned customers they may get a call from criminals or see their leaked data online. Investors punished Westpac (ASX:WBC) today after the big bank released FY22 results including a decline in full-year cash profit to $5.276 billion and a fall in earnings across its consumer and business divisions compared to the prior financial year. The big bank’s chief executive also warned Aussies will be impacted by higher rates including when borrowers’ low fixed-rate loans are rolled over. Coronado Global Resources (ASX:CRN) shares plunged today after the leading global producer of high-quality metallurgical coal announced its potential $9 billion+ merger discussions with Peabody Energy Corporation have ended.
The winning stocks for today’s session were Capricorn Metals (ASX:CMM), which added 10% after the company reported a major Mineral Resource Estimate boost at its Mt Gibson Gold Project in WA. Evolution Mining (ASX:EVN) added just under 7% today and West African Resources (ASX:WAF) rallied 6.93%. On the losing end, Coronado Global Resources (ASX:CRN) lost over 7% today, WiseTech Global (ASX:WTC) fell almost 6% and Altium (ASX:ALU) shed almost 4.5%.
The most traded stocks by Bell Direct clients today were Woodside Energy (ASX:WDS), Northern Star Resources (ASX:NST) and Syrah Resources (ASX:SRY).
In economic data out today, China’s trade balance data for October was released showing exports for the month dropped 0.3% from the year earlier, while imports fell 0.7%, with both missing market expectations. For the month, China’s trade surplus fell to US$85.15 billion, while the market was expecting the trade surplus to hit US$95.95bn.
The Australian dollar has slightly weakened today to buy 64.08 US cents, 57.01 British Pence, 94.64 Japanese Yen, and 1 New Zealand dollar and 9 cents.
The local market rebounded from Thursday’s sell-off on Friday to close the session 0.5% higher, boosted by a surge in energy stocks on the back of a rebound in the price of oil, up 4.30% to US$98.74 per barrel. Block Inc. (ASX:SQ2) was the leading stock on Friday, gaining 10.93% after the fintech company released a Q3 trading update that beat market expectations. Coronado Global Resources (ASX:CRN) extended its rally on Friday adding 8.61%, while Allkem (ASX:AKE) added just over 6% in the last trading session of the week. On the losing end, Ramelius Resources (ASX:RMS) fell 5.63% despite no price sensitive news out of the gold mining company on Friday. Blackmores (ASX:BKL) fell 3.72%, and Hub24 (ASX:HUB) lost 3.27% on Friday.
The most traded stocks by Bell Direct clients on Friday were Pilbara Minerals (ASX:PLS), Allkem (ASX:AKE) and Woodside Energy (ASX:WDS).
Over in the US, Wall Street rallied on Friday after nonfarm payrolls grew by 261,000 in October, which well exceeded market expectations of an increase between 190,000 - 205,000. The unemployment rate in the US increased to 3.7% with the biggest job gainers by industry including health care, professional and technical services and leisure and hospitality. Average hourly earnings in the US also rose 0.45 for the month and were up 4.7% from a year ago. The Dow Jones added 1.26%, the Nasdaq rose 1.28% and the S&P500 jumped 1.36% on Friday. Pfizer shares jumped 1.4% after the biotech company announced it has commenced an early-stage study of a combined COVID-19 and flu vaccine.
Over in Europe, the STOXX600 closed 1.9% higher on Friday after a big week of corporate earnings results. German sportswear brand Adidas jumped 20% on Friday to top the STOXX600 after announcing new collaborations following its split from artist Kanye West. Germany’s DAX added 2.51%, the French CAC rose 2.77% and in the UK the FTSE100 added 1.03%.
What to watch today:
- The ASX is expected to rise 1.32% on the back of the rally on Wall Street that ended last week.
- In economic data today, China’s trade balance data for October is out today with the market expecting an increase in China’s trade surplus to $95.95 billion from $84.74 billion in September. Local investors will be keeping a close eye on local data out tomorrow in terms of Westpac Consumer Confidence data for November and NAB Business Confidence data for October out tomorrow.
- In commodities, it’s a green run to start the week with crude oil up 5.04% at US$92.61 per barrel, brent crude is up 4.30% at US$98.74 per barrel, natural gas is soaring 8.3%, gold is up 3.15% at US$1680.54 per ounce and iron ore is up 4.71% at US$89 per tonne.
- The Aussie dollar has strengthened to buy 64.64 US cents, 57 British Pence, 94.58 Japanese Yen and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Trading Central has identified a bullish signal on Strandline Resources (ASX:STA) following the formation of a pattern over a period of 35-days which is roughly the same amount of time the share price may rise from the close of $0.43 per share to the range of $0.58 to $0.62 per share according to standard principles of technical analysis.
- Trading Central has also identified aa bearish signal on JB Hi-Fi (ASX:JBH) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may fall from the close of $42.50 to the range of $35.25 to $36.50 according to standard principles of technical analysis.
The Aussie share market gained 1.06% this week (Mon-Thu) despite the US Federal Reserve maintaining its hawkish approach to tackling inflation and China’s slowing factory activity.
In this week's wrap, Grady covers:
- (0:11) Why iron ore entered freefall mode this week
- (2:32) China's GDP forecasts
- (3:40) The best performing stocks on the ASX200
- (4:42) The most traded stocks & ETFs by Bell Direct clients
- (5:20) Three economic news items to watch out for
US markets closed sharply lower again on Thursday after Fed Chair Jerome Powell said that hopes for a policy pivot were ‘premature’ after the central bank delivered a fourth consecutive 75-basis point rate hike on Wednesday. The S&P500 fell 1.1%, the Dow Jones lost 0.5% and the tech-heavy Nasdaq took the biggest hit, closing the session down 1.7%. Despite the tech sell-off, shares in creative marketplace Etsy rallied 15% on Thursday after the company released quarterly earnings results that beat market expectations. US investors now shift focus to the important jobs data out today, with the market expecting an increase of 190,000 jobs to payrolls in October. Should the figures come in at 190,000 it would indicate the tight labour market in the US remains as demand of jobs continues to well outweigh supply of available workers across the nation.
Over in the UK, investor sentiment was also dampened by the Bank of England following in the US footsteps by also raising the UK’s interest rate 75-basis points yesterday. Despite the rate hike, the FTSE100 rose 0.62% on Thursday. In Europe, the sell-off from Wednesday continued with Germany’s DAX falling almost 1%, the French CAC dropping 0.54% and the STOXX600 closing down 0.93%.
What to watch today:
- Ahead of the local trading session, the SPI futures are anticipating the ASX to open 0.35% lower on the back of the Wall Street sell-off overnight.
- In commodities this morning, crude oil is trading 2.05% lower this morning at US$88.15 per barrel, brent oil is trading 1.79% lower at US$94.45 per barrel, gold is also trading 0.29% lower at US$1630.10 per ounce and iron ore is flat at US$81.50 per tonne.
- The Aussie dollar has weakened overnight to buy 62.94 U.S. cents, 55.91 British Pence, 93.33 Japanese Yen and 1 New Zealand dollar and 9 cents.
Trading Ideas:
- Trading Central has identified a bullish signal on Galan Lithium (ASX:GLN) following the formation of a pattern over a period of 8-days which is roughly the same amount of time the share price may rise from the close of $1.61 to the range of $2.04 to $2.14 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Bendigo and Adelaide Bank (ASX:BEN) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may fall from the close of $8.99 to the range of $7.40 to $7.70 according to standard principles of technical analysis.
The local market followed in the footsteps of global markets following the Fed’s latest 75-basis point rate hike announced yesterday, with the ASX closing Thursday’s session down 1.84% as a sharp sell-off in materials stocks weighed on the key index. Every sector aside from communications services stocks ended the session in the red.
The story of the session today was shares in Australian investment fund and trustee group Perpetual (ASX:PPT) lifting more than 8% after the company announced it has received and rejected a takeover offer for $30 per share from a consortium of BPEA Private Equity and fund manager Regal Partners. Woolworths (ASX:WOW) released first quarter results this morning including sales up 1.8% to $16.36 billion, however online sales tumbled 14.5% as Australians cycled out of lockdowns in the post-pandemic era. The supermarket giant also revealed average Australian food prices increased 7.3% on the PCP, with the company unsure of how much of this relates to the cost-of-living pressures compared to COVID-19 normalisation. The a2 Milk Company (ASX:A2M) also made waves today announcing it has been granted temporary access to sell its a2 Platinum infant formula in the US until 6th January 2023, as the country continues facing a significant baby formula shortage crisis following the contamination scare back in February.
The winning stocks today were Perpetual (ASX:PPT) after receiving and rejecting a takeover bid, New Hope Corporation (ASX:NHC) and Downer EDI (ASX:DOW). On the losing end, Domino’s Pizza (ASX:DMP) tanked almost 12% after the pizza giant released a disappointing trading update at its AGM. Pendal Group (ASX:PDL) shares fell 10.7% and Lendlease (ASX:LLC) lost 8.73% today.
The most traded stocks by Bell Direct clients today were the BetaShares Strong Bear Hedge Fund (ASX:BBOZ), Norfolk Metals (ASX:NFL) as the gold and uranium explorer soared more than 125% today after announcing its maiden drill test intersected native copper and sulphide mineralisation at the Roger River project. Bell Direct clients also traded BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO) today.
Australia’s trade balance data for September released today indicated the country’s trade surplus surged to a three-month high of $12.44bn for the month, well exceeding market expectations, and showing a recovery in the country’s exports, driven by LNG and metal ore exports rising 19.5% and 8.7% respectively.
On the commodities front, brent oil is down 0.7% at US$95.50 per barrel, coal is up 0.56% at US$361 per tonne, gold is up 0.14% at US$1637 per ounce and iron ore is flat at US$81.50 per tonne.
The Australian dollar has weakened to buy 63.5 US cents, 55.91 British Pence, 93.76 Japanese Yen, and 1 New Zealand dollar and 9 cents.
The US markets were sharply sold off across the key indices on Wednesday after the Federal Reserve moved to raise the country’s cash rate by 75-basis points for a fourth straight month, in a bid to tackle the nation’s 40-year high inflation. Federal Chair Jerome Powell said there were ‘no grounds for complacency’ but also said the chances of the US economy achieving a ‘soft landing’ and avoiding recession as it fights off inflation have ‘narrowed’. The Dow Jones industrials index fell 1.55%, the S&P500 shed 2.5% and the tech-heavy Nasdaq plunged 3.36%. Powell also indicated the Fed expects to raise interest rates to 4.4% by the end of this year.
Tech stocks tumbled on Wednesday, with Alphabet, Apple and Microsoft each slumping more than 3%. Trading volumes surged on Wednesday after the Fed handed down its latest interest rate hike with FactSet data showing volume was fairly muted ahead of the decision, with the widely followed SPDR S&P500 ETF which tracks the benchmark index, traded about 100.3m shares with roughly 20 minutes left in the session. The midweek global sell-off extended into Europe with Germany’s DAX falling 0.61%, the French CAC losing 0.81% and, in the UK, the FTSE100 closed 0.58% lower, as investors focus on the Fed’s aggressive rate hike moves.
What to watch today:
- Ahead of the local trading session the SPI futures are expecting the ASX to open 1.59% lower amid the global market sell-off overnight.
- In commodities, it’s a mixed bag this morning with Brent crude oil trading 0.79% higher at US$95.40 per barrel, while gold is down 0.64% at US$1,637 per ounce, and iron ore is down 0.61% at US$81.50 per tonne. The Aussie dollar has weakened overnight to buy 63.55 US cents, 55.91 British Pence, 93.90 Japanese yen and 1 dollar and 9 New Zealand cents.
- Australia’s trade balance data will be released at 11:30am AEDT today, with the market expecting a rebound in trade surplus to $8.85 billion.
Trading Ideas:
- Trading Central has identified a bullish signal on Bellevue Gold (ASX:BGL) following the formation of a pattern over a period of 40-days which is roughly the same amount of time the share price may rise from the close of $0.77 to the range of $0.91 - $0.95 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Energy Resources (ASX:ERA) of Australia following the formation of a pattern over a period of 38-days which is roughly the same amount of time the share price may rise from the close of $0.22 to the range of $0.26 - $0.28 according to standard principles of technical analysis.
The local market extended its rally into the midweek session, closing the day up just 0.14%, buoyed by the materials sector jumping 1.13% while real estate stocks were sharply sold-off on the back of the RBA’s 0.25% interest rate hike announcement. A day after the RBA continued its dovish approach to tackling the country’s inflation by announcing another 25-basis point rate hike, CBA has announced its variable home loan interest rate will increase by 0.25%, passing the full RBA rate hike onto customers. Shares in the big bank rose 0.15% today following the announcement.
New data released out of the US indicating crude oil inventories are declining, signal further signs of demand-driven market tightness which fuelled the price of crude oil to jump 1.25% today to US$89.5 per barrel. The new data also sparked a rally for oil giants Woodside Energy (ASX:WDS) and Santos (ASX:STO) today, each gaining 1.5% and 0.6% respectively. The energy sector regained momentum today after closing lower yesterday, on the back of the news about the declining oil stockpile in the US.
The story of the session today was global market-leading packaging company Amcor (ASX:AMC) falling 4.35% despite releasing its quarterly update including a 9% increase in revenue to US$3.7bn, and net income rising 15% to US$232m. The packaging company also reported price rises totalling US$400m over the three months to pass on the increase in raw materials to customers.
Taking a look at the stocks that led the market gains today, Coronado Global Resources (ASX:CRN) jumped 8.55% after Morgans retailed its ‘add’ rating on the coal miner and increased its price target on CRN to $2.40, noting better than expected revenue and earnings during the last quarter as the reason. Lake Resources (ASX:LKE) lifted 5.2% today following the release of a positive update on the company’s Kachi project in Argentina. Imugene (ASX:IMU) also added 5% today, to round out the top three winning stocks of the session. And on the losing end of the market, Domino’s Pizza (ASX:DMP) fell 5.8% today, Cromwell Property Group (ASX:CMW) lost 5.5% and Amcor (ASX:AMC) fell 4.4%.
The most traded stocks by Bell Direct clients today were Seven Group (ASX:SVW), Boral (ASX:BLD) and the Commonwealth Bank of Australia (ASX:CBA).
Today was a big day for housing data in Australia with the release of building permits for September showing a 5.8% decline for the month which was lower than the market was expecting, while home loans for September fell 9.3% which is more than triple the amount the market was expecting.
On the commodities front today, gold is trading 0.2% higher at US$1,650.85 per ounce, iron ore is down 0.6% at US$81.50 per tonne, and lithium carbonate continues rising to new records, up 2.2% to 564,500 Chinese Yuan per tonne.
The Australian dollar is buying 64 US cents, 55.7 British Pence, 94.71 Japanese Yen and 1 New Zealand Dollar and 9 cents.
The market wasn’t too fazed by the RBA’s 25 basis point rate hike yesterday, as the ASX rallied 1.65% higher. All industry sectors closed with gains, with Materials, utilities and real estate in the lead.
Biotech company Imugene (ASX:IMU) was the best performing stock following a clinical trial update, with IMU gaining 11.4% by the close of trade. Nickel Industries (ASX:NIC), United Malt Group (ASX:UMG) and GrainCorp (ASX:GNC) also closed higher.
The most traded stocks by Bell Direct clients yesterday were Commonwealth Bank (ASX:CBA), Northern Star Resources (ASX:NST) and Telstra (ASX:TLS).
US equities closed in the red overnight, as investors await the Federal Reserve’s meeting on Thursday. The Dow Jones closed 0.2% lower, the S&P500 down 0.4% and the Nasdaq down 0.9%.
What to watch today:
- The futures are suggesting the Australian market will open flat this morning, as investors wait for the Fed’s decision tomorrow morning.
- In commodities, the price of oil has rebounded and is currently trading 2.2% higher as a sharp depreciation of the US dollar and tight global supplies sparked some dip-buying. Gold is trading 0.9% higher as bond yields retreated, while iron ore has fallen 2.4% extending its decline and hitting its lowest level since April 2020.
- Watch the following stocks share price movements today, as these companies are set to release some announcements. Amcor (ASX:AMC) will release its quarterly earnings today and Goodman Group (ASX:GMG) will also deliver a quarterly report. Domino’s Pizza (ASX:DMP) is set to hold its AGM today.
- Event Hospitality and Entertainment (ASX:EVT) is set to go ex-dividend today, so this may see its share price fall as investors take their profits.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Cluey (ASX:CLU) following the release of the company’s quarterly update, with group key metrics broadly in-line with Bell Potter’s expectations. They have lowered their 12-month valuation from $1.10 to $0.90, and at CLU’s current share price of $0.50, this implies 78.2% share price growth in a year.
- And Trading Central have identified a bullish signal in Qantas (ASX:QAN) indicating that the stock price may rise from the close of $6.00 to the range of $6.75 to $6.90 over 9 days, according to the standard principles of technical analysis.
US equities closed lower overnight, however the Dow Jones still posted the best month since 1976. Markets made an impressive comeback in October with the Dow Jones rising 14% for the month, as investor bet on the banks and more traditional companies. The S&P500 is up 8% for the month, while the Nasdaq underperformed the Dow and the S&P, gaining 4% for October. Overnight, the Dow Jones fell 0.4%, the S&P500 fell 0.8% and the Nasdaq dropped 1%.
European markets closed higher despite inflation and GDP coming in overnight, painting a bleak picture. Eurozone inflation hit a record high of 10.7%, the highest ever monthly reading. Prices are increasing, particularly energy and food over the last year. The increases have been accentuated by Russia’s invasion of Ukraine in late February.
What to watch today:
- The Australian market is set to open higher. The SPI futures are suggesting a 0.15% rise at the open this morning, ahead of the RBA’s interest rate decision today.
- The RBA is expected to list the cash rate by 25 basis points to 2.85%. The announcement will be at 1:30pm AEDT.
- In commodities:
- Oil has dropped 1.6% with fears of weak oil demand, particularly in China.
- Gold is trading 0.5% lower, continuing a recent decline ahead of the US Fed’s meeting on Thursday.
- Iron ore has crashed 6%, training at US$84 per tonne, the lowest since May 2020, as recession fears and expectations of lower demand continued to pressure prices. Chinese iron ore imports from January to September are 2.3% lowered compared to last year. Supply pressures are also lower as Covid cases decrease, easing chances of lockdowns in production hubs.
Trading Ideas:
- Bell Potter maintain a Buy rating on Coronado Global Resources (ASX:CRN) and have lowered their price target to $2.10. At CRN’s current share price of $1.86, this implies 12.9% share price growth in a year.
- Trading Central have identified a bullish signal in Goodman Group (ASX:GMG) indicating that the stock price may rise from the close of $17 to the range of $18.80 to $19.20 over 23 days, according to the standard principles of technical analysis.
The strong rally that ended Wall St on a high last Friday boosted the ASX to close the first trading session of the week 1.2%% higher, which also improves investor sentiment heading into the big week of global cash rate decision announcements, with the RBA’s out tomorrow, and the US Fed’s decision and the UK rate announcement each out on Thursday.
The ASX had a sharp surge in the opening hour of trade, paired back gains slightly around the mid-session but regained momentum in the afternoon to close the day in the green. The technology sector felt a relief rally today on the back of the strong session for the tech-heavy Nasdaq on Wall St on Friday, while the energy sector closed lower today amid the declining commodity prices.
The story of the session was EML Payments (ASX:EML) tanking more than 25% today after the company announced further issues with its UK business. EML said it has agreed to temporarily cease onboarding new customers, agents and distributors in relation to its UK subsidiary, Prepaid Financial Services, following concerns raised by the UK Regulator, the Financial Conduct Authority. The temporary half is expected to cause a financial impact, as the company reduce its group revenue expectation by less than $5m in FY23.
GrainCorp (ASX:GNC) on the other hand soared more than 7.5% today after Russia pulled out of an agreement to enable grain exports from Ukraine through the Black Sea, a deal that was considered to be vital for easing the currently tight global supplies of grain like wheat. Russia’s decision is already putting upward pressure on grain prices including wheat surging 5.92% to US$878.12 per bushel.
The winning stocks today were Home Consortium (ASX:HMC), GrainCorp (ASX:GNC) and Lake Resources (ASX:LKE). On the other end, the losing stocks were NEXTDC (ASX:NXT), Whitehaven Coal (ASX:WHC) and Brainchip Holdings (ASX:BRN).
The most traded stocks by Bell Direct clients today were WA1 Resources (ASX:WA1), Whitehaven Coal (ASX:WHC) and BHP Group (ASX:BHP).
Australian retail sales data for September out today showed Australians continued to spend in the month of September despite high inflation and rising interest rates making all purchases less affordable.
Tomorrow at 1:30pm AEDT, all eyes will be on the RBA’s interest rate decision, with the market expecting the country’s central bank to announce another 25-basis point rate hike for the month of November.
On the commodities front, iron ore continues to dip today, trading down 5.62% at US$84/tonne. The price of the commodity continues to tumble amid concerns over declining global steel demand after China’s services activity falling for the 1st time in 5-months in data out today, while at the same time there are renewed signs that supply of the commodity is strengthening.
The Australian dollar is trading slightly stronger today, with 1 Aussie dollar buying 64.26 US cents, 55.51 British Pence, 95.03 Japanese Yen, and 1 dollar and 10 New Zealand cents.
The local market snapped a four-session winning streak on Friday, to close 0.87% lower as investors sharply sold off 4% amid a sharp decline in commodity prices, including iron ore tumbling 5.6%.
BrainChip (ASX:BRN) was the most sold-off stock on Friday, with the world-leading AI on-chip processing and learning technology company tanking 21.2% after releasing a Q3 update, outlining that the $1.5 billion company generated cash receipts of just $118,000 and an operating loss and operating cash outflow of $3.8 million for the quarter. Macquarie (ASX:MQG) shares were virtually unchanged at the closing bell on Friday despite the investment bank releasing strong half-year results including net operating income up 11% to $8.641 billion, profit after tax rising 13% to $2.305 billion and an interim dividend rise of 10% to $3 per share. Total operating expenses also rose though by 13% to $2.305 billion.
The most traded stocks by Bell Direct clients on Friday were BHP Group (ASX:BHP), BrainChip (ASX:BRN) and Lake Resources (ASX:LKE).
Overseas on Friday, the US market ended higher after a turbulent week, following the release of Apple’s earnings report that boosted the tech-heavy Nasdaq higher to lead the gains on Wall St. The Dow Jones industrial index added 2.6%, the Nasdaq rose 2.87% and the S&P500 lifted 2.46% on the last trading session of the week. Investor sentiment was also boosted on Friday – investors are optimistic that the Fed may indicate this week that it is preparing to pivot toward a slower pace of monetary tightening.
In Europe, markets closed mixed after the European Central Bank raised its interest rate by 75-basis points, alongside the release of a number of company earnings reports. The Stoxx 600 closed up just 0.1% while Germany’s DAX added 0.24% and the French CAC climbed 0.27%, but the UK’s FTSE100 fell almost 0.4%. Shell shares fell more than 1.5% on Friday despite the oil and gas giant releasing third quarter results on Thursday including quarterly profits more than doubling from the same period a year earlier.
What to watch today:
- The ASX is set to open 1.36% higher, following the strong rally on Wall Street that ended the last trading week higher.
- In commodities this morning, crude oil is trading 0.7% lower at US$96.31 per barrel, gold is trading 1% lower at US$1,644 per ounce, iron ore is down 5.6% at US$84 per tonne and gas is trading down 5.8% at US$2.84 per gallon.
- There is no local economic data released today, however local investors will be keenly awaiting the release of the RBA’s interest rate decision out tomorrow at 1:30pm AEDT with the market expecting another rise of 0.25% taking the nation’s cash rate to 2.85%.
Trading Ideas:
- Trading Central has identified a bullish signal on Auckland International Airport (ASX:AIA) following the formation of a pattern over a period of 27 days which is roughly the same amount of time the share price may rise from the close of $6.82 to the range of $7.13 to $7.21 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 34 days which is roughly the same amount of time the share price may fall from the close of $0.65 to the range of $0.53 to $0.55 according to standard principles of technical analysis.
The Aussie share market rallied 2.52% this week (Mon-Thu). The real estate sector soared 5.56%, while consumer staples was the only sector to end the week lower.
In this week's wrap, Grady covers:
- (0:36) Bell Potter's view on the Federal Budget's spending allocations
- (2:44) What to look out for in company results
- (3:13) How the REIT sector performed this week
- (3:22) The best performing stocks on the ASX200
- (4:43) The most traded stocks & ETFs by Bell Direct clients
- (5:10) Two economic news items to watch out for
US equities closed mixed overnight after new data showed third-quarter GDP grew faster than expected, encouraging investors to buy stocks linked to the health of the economy. The US economy grew at a 2.6% annualised pace for the period, against the Dow Jones estimate for 2.3% growth. The Dow closed almost 200 points higher, while the S&P500 closed 0.6% lower. The Nasdaq also closed lower, down 1.6%, weighed down by Meta. Meta reported weak fourth-quarter forecast and disappointing third-quarter earnings, which saw its share price tumble 25%.
What to watch today:
- The SPI futures are suggesting the Australian market will drop 0.38% at the open this morning, following the mixed session in New York.
- In commodities, the oil price is has jumped, underpinned by record US crude exports data. The US exported a record amount of crude and fuel last week, with total petroleum shipments reaching 11.4 million barrels a day. This is even as fuel inventories hit seasonal lows, adding to concerns about tight supply. So keep watch of energy shares today such as Woodside (ASX:WDS) and Beach Energy (ASX:BPT). Meanwhile gold is hovering near the highest levels in two weeks, as the US dollar and Treasury yields retreated, while iron ore is trading in the red, at its lowest in 22 months, as expectations of lower demand continue to put pressure on prices.
- Macquarie Group (ASX:MQG) will be in focus today, as the investment bank is set to release its half year results. Goldman Sachs expect to MQG to report a cash NPAT of $2,183 million, which is higher than market consensus estimates of $2,157 million.
- De Grey Mining (ASX:DEG) and ResMed (ASX:RMD) will each be releasing a quarterly report today.
Trading Ideas:
- Bell Potter maintain a Buy rating on Regis Resources (ASX:RRL) after the company gave a quarterly production update yesterday. Bell Potter have lowered their price target to $2.68, and at its current share price of $1.56 this implies 71.8 share price growth in a year.
- Trading Central have identified a bullish signal in Lynas Rare Earths (ASX:LYC) indicating that the stock price may rise from the close of $8.34 to the range of $9.05 to $9.25 over 30 days according to the standard principles of technical analysis.
The local market’s rally extended into Thursday, with the key index closing 0.5% higher in its best session in 6-weeks, boosted by a surge in energy stocks. An array of corporate earnings results were released today including ANZ (ASX:ANZ), which beat expectations but investors sharply sold out amid uncertain outlook for the year ahead and the increase of the bank’s provision for doubtful debts, and Reece which investors piled into after the company released a Q1 trading update outlining sales revenue jumped 28.8% to $2.3 billion boosted by inflation.
Australian Clinical Labs (ASX:ACL) is the latest company to report a cyber-attack that happened back in February, whereby the health records and credit card information of about 223,000 patients and staff in its Medilab Pathology business were stolen and posted on the dark web. Shares in the company plunged more than 5% today. While Weebit Nano (ASX:WBT) surged nearly 30% today after announcing it has successfully completed full technology qualification of its Resistive Random-Access Memory (ReRam Module) manufactured by its R&D partner CEA-Leti, which is a key step that must be completed for every semiconductor product on each new target process.
The winning stocks for today’s session were Ramelius Resources (ASX:RMS) adding 8.4% a day after the gold miner reaffirmed production guidance for FY23, Sandfire Resources (ASX:SFR) lifting 7% and Regis Resources (ASX:RRL) ending the day up 6.85%. On the losing end of the market, Iluka Resources (ASX:ILU) took the biggest hit today, falling 6.31% despite no price sensitive news released by the company today, Core Lithium (ASX:CXO) fell 5.15% today and Pinnacle Investment Management (ASX:PNI) lost 3.35% today.
The most traded stocks by Bell Direct clients today were Lake Resources (ASX:LKE), Commonwealth Bank of Australia (ASX:CBA) and WA1 Resources (ASX:WA1).
The Australian dollar is trading higher again this afternoon against the green back with 1 Aussie dollar buying 64.82 US cents, 55.90 British Pence, 94.56 Japanese Yen and 1 New Zealand Dollar and 11 Cents.
Following Australia’s inflation rate hitting a 32-year high for the September quarter of 7.3%, investors will be awaiting the release of the RBA’s latest cash rate hike next Tuesday when the central bank next meets.
The US markets closed mixed on Wednesday with the Dow Jones industrials index adding 0.05%, while the S&P500 fell almost three quarters of a percent and the tech-heavy Nasdaq tumbled more than 2%, weighed down by Alphabet. Google parent company Alphabet had its worse session since 2020 yesterday after the tech giant released third quarter earnings on Tuesday that missed analysts’ expectations on both top and bottom lines. Investor sentiment was hit again on Wednesday after the earnings report out of Alphabet missed expectations which bucks the trend in recent days of strong company earnings reports for the third quarter, while Microsoft highlighted the impact the Fed and consequently the surging dollar had on the economy. Sentiment was briefly boosted early in the session by the Bank of Canada releasing a lower-than-expected rate hike for October amid fears of a recession, but that wore off in afternoon trade as investors don’t necessarily see that move as a sign the Fed’s will follow suit.
Over in Europe, markets closed higher amid strong earnings reports out of some European companies including Deutsche Bank and Mercedes Benz. Germany’s DAX closed the midweek session up 1.09% while the French CAC rallied 0.41%. The European Central Bank will also meet on Thursday where it is widely expected to raise the region’s cash rate by 75-basis points. The UK’s FTSE100 also rallied, adding 0.61% on Wednesday.
What to watch today:
- Stocks going ex-dividend today include Bank of Queensland (ASX:BOQ) and Tribune Resources (ASX:TBR). If you’ve been considering these stocks it might be worth buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- On the commodities front, brent crude oil is trading 2.38% higher at US$95.75 per barrel, gold is up 0.7% at US$1664.07 per ounce and iron ore is down almost 1.6% to US$94 per tonne.
- The Aussie dollar has strengthened to buy 64.93 U.S. cents, 95.01 Japanese Yen, 56.37 British Pence and 1 New Zealand dollar and 11 cents.
- The SPI futures are expecting the ASX to open 0.38% higher.
Trading Ideas:
- Trading Central has identified a bullish signal on Flight Centre Travel Group (ASX:FLT) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $15.85 to the range of $17-$17.30 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on BlueScope Steel (ASX:BSL) following the formation of a pattern over a period of 95-days which is roughly the same amount of time the share price may fall from the close of $15.70 to the range of $12.30-$13.00 according to standard principles of technical analysis.
The ASX200 closed the session 0.2% higher today, with real estate and utilities in the lead, each rallying more than 2% higher. Meanwhile, consumer staples and energy were hit the hardest.
Eight of the eleven industry sectors close in the green, despite key inflation data being released today. Australia’s annual inflation rate has risen to 7.3% in the last 12 months to September, the highest reading since 1990. On a quarterly basis, the consumer price index rose 1.8% in the September quarter. This is due to higher prices for new dwelling construction, fuel and food.
Looking at the ASX200 leaderboard today, Costa Group (ASX:CGC) was the best performing stock, advancing more than 10%, after a private equity firm acquired a 14% stake in the company. Other top performers were G.U.D Holdings (ASX:GUD), Ramelius Resources (ASX:RMS) and Nufarm (ASX:NUF).
Medibank (ASX:MPL) declined the most today, its share price tumbling more than 18%, after the company announced all of their customers’ personal data has been compromised by a cyber attacked. Meanwhile, mining companies Whitehaven Coal (ASX:WHC), Pilbara Minerals (ASX:PLS) and New Hope Corporation (ASX:NHC) are also in the red.
The most traded stocks by Bell Direct clients today were WA1 Resources (ASX:WA1), ELMO Software (ASX:ELO) and Whitehaven (ASX:WHC).
Lastly, the Australian dollar is buying 64 US cents, 56.58 British Pence, 94.92 Japanese Yen and $1.12 New Zealand.
Wall Street extended its advance overnight, closing higher for the third consecutive day. The Dow gained 1.1% or 337 points. The S&P500 advanced 1.6%, and the Nasdaq advanced 2.2%, ahead of earnings releases from some big tech names. After the closing bell both Microsoft and Alphabet reported earnings that fell short of expectations. And later in the week, Amazon, Apple and Meta Platforms will report earnings. Also, a decline in bond yields contributed to the latest gains, as the yield on the 10-year Treasury note was last down about 15 basis points.
European equities also had a positive run. Tech stocks were up 4%, while oil and gas stocks and bank stocks were the only sectors to end the session in negative territory. The Stoxx 600 closed 1.4% higher.
What to watch today:
- The SPI futures are suggesting the Australian market will rise 0.82% at the open this morning.
- Last night the government handed down the Federal Budget. Some of the winners included new parents and families, with increased parental leave and reduced cost of childcare. Also, battery, hydrogen fuel cell and plug-in hybrid cars are to be exempted from taxes, if their retail price is below the luxury car tax threshold. This may have an impact on battery making lithium stocks. A million new homes will also be built over 5 years from 2024, so stocks such as Lendlease (ASX:LLC) may benefit from this. On the downside however, power costs are to rise by 20% this year and 30% next year. Also, food crop losses and distribution to milk supplies due to the floods are expected to add 0.1% to inflation in the December and March quarters. Generally though, the budget doesn’t have a big influence over market movements.
- In commodities, the oil price trading higher, just under US$85 per barrel. Gold is also in the green, trading just under US$1,653 an ounce. And iron ore has regained 1%, now US$95.50 per tonne.
- In economic data, today the inflation rate for the third quarter is set to be released at 10:30am AEDT, expected to rise by 6.1% to 6.5%.
- Keep watch of the following companies, that are set to release a quarterly report today. These include Coles (ASX:COL), Iluka Resources (ASX:ILU), Mirvac Group (ASX:MGR), Mineral Resources (ASX:MIN) and Westfield (ASX:URW).
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on PointsBet Holdings (ASX:PBH) and have lowered their valuation from $5.25 to $4.50. At its current share price of $2.03, this implies over 100% share price growth in a year.
- Trading Central have identified a bearish signal in News Corp (ASX:NWS), indicating that the stock price may fall from the close of $26.74 to the range of $22.20 to $23 over 17 days, according to the standard principles of technical analysis.
The ASX200 moved higher today, closing with a 0.3% gain. Nine of the eleven industry sectors are in the green with real estate stocks advancing the most, up 1.7%. Meanwhile, the energy and materials sectors declined the most.
Lithium company Sayona Mining (ASX:SYA) was the best performing stock on the ASX200 today, closing the session 10.6% higher. While there was no news from the company, its share price was likely boosted by the price of lithium, which has reached a record high. Lithium carbonate prices in China extended its record high, now up 95% year-to-date, as surging demand coincides with tight supply. Other top performing stocks today included Credit Corp (ASX:CCP), St Barbara (ASX:SBM), Nine Entertainment (ASX:NEC) and Core Lithium (ASX:CXO).
On the flip side, Reliance Worldwide (ASX:RWC) declined the most today, closing the session more than 13% lower. The company released a quarterly update this morning, which was a mixed bag of results. Sales increased when compared to the prior corresponding period, while EBITDA margins fell more than 26% over the quarter. Ampol (ASX:ALD), New Hope Corporation (ASX:NHC) and Chalice Mining (ASX:CHN) also closed in the red.
The most traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), Pilbara Minerals (ASX:PLS), the Bank of Queensland (ASX:BOQ) and Sayona Mining (ASX:SYA).
Tonight, the government will be handing down the Federal Budget. This isn’t likely to have much impact on markets, however we’ll all still be watching the budget tonight. It’ll be announced at 6:30pm AEDT. And tomorrow the inflation rate for the third quarter will be released. The inflation report is more likely to have some influence over markets tomorrow, with inflation expected to rise from 6.1% to 6.5%. This is a key piece of data ahead of the RBA’s next meeting on Tuesday, when markets are expecting a 25-basis point rate hike.
Lastly, the Australian dollar is buying 63 US cents, 56.58 British Pence, 94.13 Japanese Yen and 1 dollar and 11 cents New Zealand.
US equities saw its second day of gains. The Dow Jones gained more than 400 points or 1.3%. The S&P500 gained 1.2% and the Nasdaq closed 0.9% higher. Traders are also awaiting the earnings results of four of the biggest tech companies. Results for Alphabet and Microsoft are out tonight, and Apple and Amazon are due Thursday.
European markets also closed in the green, following the announcement that Rishi Sunak is the new UK prime minister.
What to watch today:
- Our local market is set to open higher. The SPI futures are suggesting a 0.4% rise at the open this morning.
- In economic data, the government will be handing down the Federal Budget tonight. This of course will be on watch, however it is unlikely to move markets. What is more pressing on markets is the inflation report, which is set to be released tomorrow. And this is a key piece of data ahead of the RBA’s next meeting on Tuesday.
- Looking at commodities,
- Oil is trading lower as worries about a deteriorating growth outlook continue. Also, Chinese customs data showed that demand from the world’s largest crude importer remained subdued in September, as covid-induced restrictions and fuel export curbs, supressed consumption.
- The price of gold has dropped, while iron ore has slowly started to regain earlier losses.
- The following companies are set to release a quarterly report today, so keep watch of their share price movements. These include Ampol (ASX:ALD), Mineral Resources (ASX:MIN), Pilbara Minerals (ASX:PLS) and Reliance Worldwide Corporation (ASX:RWC).
The Australian dollar has dropped, currently buying 63 US cents, 56.58 British Pence, 94 Japanese Yen and 1 dollar and 10 cents New Zealand.
Trading Ideas:
- Bell Potter maintains a Speculative BUY rating on Clean Seas Seafood (ASX:CSS) with a price target of $0.85. At its current share price of $0.55, this implies 54.5% share price growth in a year.
- Trading Central have identified a bullish signal in Lynas Rare Earths (ASX:LYC) indicating that the stock price may rise from the close of $7.86 to the range of $8.55 to $8.75 over 25 days, according to the standard principles of technical analysis.
The ASX started the week exactly how it was anticipated to, closing Monday’s session 1.54% higher on the back of the strong rally that took over Wall Street on Friday. All eleven sectors of the ASX closed the first trading session of the week in positive territory.
Energy stocks were the worst performing today but still managed to close 0.74% higher despite oil prices dropping amid dampened sentiment following the conclusions of the party congress in China, with analysts in the region saying, ‘oil will remain choppy as recession risk and supply tightening balance each other out’. Fuel supplier Viva Energy (ASX:VEA) rallied today on the back of a Q3 FY22 trading update outlining sales volumes reached their highest level since pre-COVID-19 in during the quarter, rising 19.7% on the PCP. NOVONIX (ASX:NVX) shares rocketed a further 33% today as investors continue piling into the battery materials and technology company following the release of the major announcement last week that the company’s Anode Materials division has been selected to enter negotiations to receive US$150m in grant funding from the US Department of Energy. The materials sector led the rally today, adding more than 2.5% driven by Evolution Mining (ASX:EVN) adding 8.3%, Gold Road Resources (ASX:GOR) rallying 6.4% and Pilbara Minerals (ASX:PLS) lifting 6.21%.
The winning stocks for today’s session were NOVONIX (ASX:NVX), Evolution Mining (ASX:EVN) and Gold Road Resources (ASX:GOR). On the losing end of the market, South32 (ASX:S32) took the biggest hit today dropping just 1.88%, Beach Energy (ASX:BPT) fell 1.3% and Graincorp (ASX:GNC) also lost 1.3%.
The most traded stocks by Bell Direct clients today were South32 (ASX:S32), Pilbara Minerals (ASX:PLS) and Alumina (ASX:AWC).
China’s GDP growth rate for Q3 soared to 3.9% in data released today, which well exceeded market expectations of a 3.4% rise, and was a big jump from the 0.4% increase in Q2. Local investors will be keeping a keen eye out for Australia’s inflation rate for Q3 which is out on Wednesday.
The Australian dollar is buying 63.8 US cents, 56.58 British Pence, 94.42 Japanese Yen and 1 dollar and 10 New Zealand cents.
The local market ended Friday’s session 0.8% lower with every sector aside from energy stocks closing in negative territory. On Friday, investor sentiment was dampened by fears of a global recession but the energy sector offset sharp some of the losses, buoyed by strong gains for coal miners.
Telix Pharmaceuticals (ASX:TLX) led the ASX200 winners on Friday after ending the session up 12.67%, New Hope Corporation (ASX;NHC) rallied 7.7% to end the week, and Perseus Mining (ASX:PRU) lifted 5.85% on Friday. On the other end of the market, Home Consortium (ASX:HMC) fell 5.45% on Friday, Origin Energy (ASX:ORG) dropped 4.35% and Kelsian Group (ASX:KLS) fell 4.18%.
The most traded stocks by Bell Direct clients on Friday were Woodside Energy (ASX:WDS), Grange Resources (ASX:GRR) and Northern Star Resources (ASX:NST).
Over in the US, the ongoing swings between positive and negative investor sentiment shifted positive again on Friday after San Francisco Fed leader Mary Daly said at some point rate rises would moderate though it’s not yet time to ‘step down’ from large hikes, which fuelled a rally on Wall St. The Dow Jones Industrials index added 2%, the S&P500 also jumped 2% and the tech-heavy Nasdaq rose 1.7%. Earnings reports continue being released in the US with Exxon Mobil shares hitting an intra-day record high on Friday ahead of the company’s earnings report out this week, with some market analysts deeming the outlook for the company as attractive, ‘particularly for generalists needing energy exposure’.
In Europe on Friday, the STOXX600 fell amid rising concerns that major central banks around the world would retain their aggressive stance on inflation with dismal earnings updates from a number of companies. European markets were also impacted by turbulence on the UK’s political front in addition to European leaders continuing a debate on how to tackle the bloc’s energy crisis after Germany gave the green light for discussions around a price cap. Germany’s DAX closed Friday’s session 0.3% lower, the French CAC lost 0.85% and in the UK the FTSE100 rose 0.37% extending the rally from Thursday on news of the resignation of new British PM Liz Truss.
What to watch today:
- The SPI futures are anticipating the ASX to open 1.42% higher on the back of the US rally that ended last week higher.
- On the economic data front today, investors will be awaiting the release of China’s Q3 GDP growth rate data out today with the market expecting an increase to 3.4% in Q3 from a rise of 0.4% in Q2.
- In commodities, brent crude oil is trading 1.22% higher at US$93.5 per barrel, gold is trading 1.81% higher at US$1657 per ounce, and iron ore is up 0.53% at US$94.50 per tonne.
- The Aussie dollar is trading slightly stronger this morning with 1 Aussie dollar buying 64 US cents, 56.41 British Pence, 94.17 Japanese Yen and 1 New Zealand dollar and 11 cents.
Trading Ideas:
- Trading Central has identified a bullish signal on Aeris Resources (ASX:AIS) following the formation of a pattern over a period of 29 days, which is roughly the same amount of time the share price may rise from the close of $0.42 to the range of $0.52 - $0.54 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Healius (ASX:HLS) following the formation of a pattern over a period of 17 days which is roughly the same amount of time the share price may fall from the close of $3.19 to the range of $2.98 - $$3.02 according to standard principles of technical analysis.
The Aussie share market declined 1.42% this week (Mon-Thu). News on inflation, interest rates and levels of economic growth is making it more difficult for investors to agree on the direction of global markets.
In this week's wrap, Grady covers:
- (0:57) How La Nina has impacted Australian shares
- (2:52) UK inflation & US interest rate fears
- (3:22) The biggest movers on the ASX this week
- (4:45) The most traded stocks & ETFs by Bell Direct clients
- (5:13) Three economic news items to watch out for
Well while European stocks had a good run overnight, US equities closed in the red, as Treasury yields continue to climb to new highs. The benchmark 10-year Treasury yield reached 4.2%, trading at a level not seen since 2008. Stocks declined for the second consecutive session as investors digested some key earnings reports. The Dow Jones closed 0.3% lower, the S&P500 down 0.8% and the Nasdaq down 0.6%.
What to watch today:
- The Australian market is set to open lower this morning. The SPI futures are suggesting a fall of 0.37% at the open.
- In commodities, the price of oil is only slightly higher, trading just above US$85 per barrel, while gold is trading lower. Gold is approaching levels last seen in April 2020, weighed down by the rallying US dollar and Treasury yields, on expectations that the Fed will continue its aggressive approach to rate hikes. And iron ore has started to regain some of its earlier losses this week, currently trading 1% higher. Iron ore hit an 11-month low earlier this week after China emphasised the importance of its zero-COVID policy.
- There are a few stocks set to release a quarterly report today, so these companies will be the ones to watch. They include Allkem (ASX:AKE), AMP (ASX:AMP), Coronado Global Resources (ASX:CRN) and St Barbara (ASX:SBM).
- Currently, 1 Australian dollar is buying 63 US cents, 94.25 Japanese Yen, 55 British Pence and 1.1 New Zealand.
Trading Ideas:
- Bell Potter maintain a Buy rating on TechnologyOne (ASX:TNE). The company will release its FY22 results at the end of November, and the brokers view is that is may provide a catalyst for the share price, because firstly, profit before tax is likely to be toward the top end of the guidance range of 10-15% growth. Secondly, on the premise initial licence feeds may be below guidance of $12 million. Also, SaaS metrics and Annual Recurring Revenue could positively change, second half cash flow should be strong, and there is potential of capital management initiatives given the strong cash position. Bell Potter haven’t changed their forecasts, they maintain a price target of $14.25. At TNE’s current share price of $12.16, this implies 17.2% share price growth in a year.
- Trading Central have identified a bearish signal in Fortescue Metals (ASX:FMG) indicating that the stock price may fall from the close of $16.52 to the range of $11.90 to $19.80 over 39 days, according to the standard principles of technical analysis.
The local market closed in negative territory, down 1.02% today on the back of the global market sell-off overnight which was spurred by the UK’s inflation rate rising and investor sentiment in the US falling on concerns of more aggressive rate hikes to come in the region for months to come. It was another day for trading updates on the local market, causing investors to both sell-off and pile into certain stocks following the respective releases of quarterly earnings reports.
Woodside Energy (ASX:WDS) shares soared today after the oil and gas giant released a trading update today outlining record performance for Q3 including record production up 52%, sales volume up 59% and revenue jumped 70%. The results were largely driven by the inclusion of BHP’s petroleum assets. Zip Co (ASX:ZIP) also jumped 13% today after releasing a first quarter trading update today, revealing strength across both top and bottom lines including revenue up 19%, transaction numbers lifting 33%, customer numbers up 50% and merchants rising 70% to 94,100. Zip’s US business also saw credit loss rates decrease to 2.4% of total transaction volume, in line with target levels. We are seeing Australian companies are increasingly factoring in La Nina weather events set to hit the east coast over summer, into future guidance in updates released this week, for example Whitehaven Coal (ASX:WHC) and Costa Group (ASX:CGC).
The ASX200’s biggest winners today were NOVONIX (ASX:NVX) adding 7.04%, Adbri (ASX:ABC) recovered some of its losses from the past few sessions surging 6.76% today, and Woodside Energy (ASX:WDS) added 6.18%. And on the losing end, Sandfire Resources (ASX:SFR) fell 13.23%, Megaport (ASX:MP1) lost 11.80%, and St Barbara (ASX:SBM) extended its losses, falling a further 8% today.
The most traded stocks by Bell Direct clients today were the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ), Whitehaven Coal (ASX:WHC) and the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR).
Today, Australia’s unemployment rate data for September was released showing the country’s jobless rate held steady at a near-50 year low of 3.5% for the month with just 900 Aussies gained work while the number of unemployed Australians increased by 8800.
The AUD is slightly weaker today following the release of the nation’s unemployment rate with 1 Aussie dollar buying 62.63 US cents, 93.94 Japanese Yen, 55.17 British Pence, and 1.11 New Zealand.
Overseas, the US markets rally came to an end on Wednesday as treasury yields rose to multi-year highs amid concerns the Federal Reserve will remain hawkish for months to come which in-turn raises the risk of a recession. The market sell-off dampened strong earnings reports from Netflix and United Airlines as an analyst at Morgan Stanley says earnings forecasts for this reporting season had been ‘cut to the bone’ so beating forecasts wouldn’t be hard as companies had already factored in rising interest rates and other impacts into outlook for the reporting season. The Dow Jones industrials index fell 0.33%, the tech-heavy Nasdaq dropped 0.85% and the S&P500 closed the midweek session down 0.67%.
Over in Europe and the UK, the four-day rally also ended after UK inflation data for September rose again to 10.1% after an unexpected decline in august. Food, energy and transport costs drove the rise in inflation, with the country’s cost of living continuing to hit residents and businesses hard especially before the winter months. The increase in inflation enhanced investor fears of a recession in the region as further interest rate hikes are expected to cool the rising inflation. The FTSE100 fell 0.17%, Germany’s DAX lost 0.19% and the French CAC closed the midweek session 0.43% lower.
What to watch today:
- The SPI futures are anticipating the ASX to follow the global sell-off by opening 0.7% lower.
- On the commodities front, brent crude oil has rebounded from recent day declines to trade 2.67% higher at US$92.43 per barrel, iron ore is trading flat at US$95 per tonne, and gold is trading 1.44% lower at US$1629 per ounce.
- The Australian dollar has strengthened to 68.08 US cents, 55.17 British Pence, 93.98 Japanese yen and 1 New Zealand Dollar and 11 cents.
- In economic data Australia’s unemployment rate for September will be released at 10:30am AEDT with the market expecting a decline to 3.4% for September, from 3.5% in August.
Trading Ideas:
- Trading Central has identified a bullish signal on Chalice Mining (ASX:CHN) following the formation of a pattern over a period of 46-days which is roughly the same amount of time the share price may rise from the close of $4.17 to the range of $4.95 to $5.15 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Azure Minerals (ASX:AZS) following the formation of a pattern over a period of 92-days which is roughly the same amount of time the share price may rise from the close of $0.29 to the range of $0.40-$0.42 according to standard principles of technical analysis.
The ASX traded mostly higher throughout the midweek session, which saw the key index close the day up 0.31%, despite the SPI futures expecting a sell-off to start the day. It was a day for the miners both on the winning and losing end of the market scale.
BHP Group (ASX:BHP) shares were sold-off today, following the release of the mining giant’s quarterly update including production and unit cost guidance remaining unchanged for FY23, while production levels fell short of market expectations. Chalice Mining (ASX:CHN) jumped more than 9% today after the precious and base metal exploration company released an update on exploration activities at the Julimar Nickel-Copper-Platinum Group Element Project in Western Australia, with new drilling validating the recent 2D seismic interpretation, intersecting the northern extension of the complex down-plunge. Whitehaven Coal (ASX:WHC) shares sold-off at the opening bell following the release of the company’s quarterly update, however quickly rebounded as investors digested the company’s solid report including the company generating $1.55bn of cash in the quarter, and the expectation of La Nina weather events to impact production through the spring season. And Aurora Energy Metals (ASX:1AE) soared more than 17% during today’s session after revealing that the company is finalising the preparatory work for its Phase 1 RC drilling program at the Aurora Energy Metals Project, the first drilling at the project in a decade, with drilling expected to commence next week as the program targets both lithium and uranium.
The winning stocks for today’s session were led by Core Lithium (ASX:CXO) adding 8.2%, Pilbara Minerals (ASX:PLS) lifting 5.8% and Pendal Group (ASX:PDL) rallying 5.5%. On the losing end, Megaport (ASX:MP1) tumbled 22.14% today, after the company released a quarterly trading update, St Barbara (ASX:SBM) continued its decline today, ending the day down 4.76% and Karoon Energy (ASX:KAR) fell 3.3%.
The most traded stocks by Bell Direct clients today were Westpac (ASX:WBC), BHP Group (ASX:BHP), and the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ).
In terms of economic data, investors are awaiting the release of Australia’s unemployment rate for September which is out tomorrow morning, with markets forecasting a decline to 3.4% from 3.5% for the month.
The Australian dollar is trading stronger against the greenback at 63.12 US cents, 55.17 British Pence, 94.23 Japanese Yen and 1 New Zealand dollar and 11 cents.
The US markets rallied more than 1% for most of the day on Tuesday before closing the session marginally lower, with the Dow Jones & S&P500 adding 1.12% and 1.14% respectively, while the Nasdaq closed just under 1% higher, with the boosted higher by stronger than expected earnings out of Goldman Sachs, particularly on the bonds trading front. The big banks in the US reporting solid results overseas eased investor fears of a recession as the results shows investors are still spending. We are seeing these big swings in markets of late due to a see-saw effect of consumer spending remaining high, which eases recession fears, against inflation remaining stubbornly high causing central banks to raise rates to dampen spending and potentially send economies into recession. Investors are constantly torn between recessionary fears and inflationary fears. For markets to settle down investors will need to see economic growth with lower levels of inflation.
Over in the UK and Europe, the global rally extended into a fourth consecutive day in Europe with Germany’s DAX adding almost 1% on Tuesday and the French CAC lifting 0.44%, while the UK’s FTSE100 closed Tuesday’s session 0.24% higher following the move by the UK’s new finance minister to cut backtrack on all tax cuts announced at the country’s mini-budget in September.
On the commodities front, it’s a red start to the day across most commodities with brent crude oil trading down 1.14% at US$90.62 per barrel, natural gas is down more than 4%, iron ore is trading 1.55% lower at US$95 per tonne. Gold is trading just 0.07% higher at US$1651 per ounce and lithium is trading flat.
What to watch today:
- The ASX futures are expecting the local market to open 0.43% lower despite another strong session on Wall Street overnight.
- On the economic data front, US housing permits and building permits data for September will be released tonight with the markets expecting a decline on both metrics from August, while investors locally will be awaiting the release of Australia's unemployment data for September out tomorrow, with the forecast for a decline to 3.4% from 3.5%.
- The Aussie dollar has weakened to buy 62.98 US cents, 55.26 British Pence, 94.06 Japanese yen and 1 New Zealand dollar and 11 cents.
- Stocks going ex-dividend today include Spheria Emerging Companies (ASX:SEC). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Weebit Nano (ASX:WBT) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $2.36 to the range of $2.63 to $2.69 according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on Woodside Energy (ASX:WDS) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may fall from the close of $32.88 to the range of $26.75 to $28.00 according to standard principles of technical analysis.
The local market jumped 1.72% today amid a rise in US futures after a solid session on Wall Street overnight driven by solid earnings results released including from the Bank of America, which rose 6% after reporting stronger than expected Q3 results. Locally, the tech sector led gains on the key index today adding more than 4%, taking lead from the Nasdaq posting its best session since July overnight. Every sector aside from the energy sector closed higher today. Another pivot out of the UK in the form of new finance minister Jeremy Hunt saying he will reverse nearly all tax-cuts announced and that the energy price guarantee would continue through the winter, boosted markets around the world today.
The RBA’s meeting minutes for October were also released today, outlining the RBA’s shock decision to raise the country’s cash rate by 25 basis points in October was “finely balanced” with the risk of a global and domestic economic slowdown, but that further interest rates hikes would likely be required.
Today Westpac (ASX:WBC) confirmed its in takeover talks with embattled fintech company Tyro Payments (ASX:TYR) to acquire 100% of the company’s issued share capital in a bid to strengthen Westpac’s small business proposition particularly in the hospitality and healthcare sectors. Following the announcement, shares in Westpac (ASX:WBC) rose 2.3%, while Tyro Payments (ASX:TYR) shares rallied 1.9%.
The winning stocks for today’s session were NOVONIX (ASX:NVX) which added 18.99% amid the surge in tech stocks today, Hub24 (ASX:HUB) jumped 14% today after the company released a quarterly update outlining net inflows of $3 billion for the quarter, and Telix Pharmaceuticals (ASX:TLX) added 11% today after the company released promising preliminary data from two investigator-initiated studies in triple negative breast cancer, and non-muscle-invasive bladder cancer.
On the losing end of the market today, St Barbara (ASX:SBM) took the biggest hit, tanking more than 21.5% after releasing a first quarter report for the three months to September 30, including a downgrade to the gold miner’s guidance for FY23 on the back of a slower than expected ramp up in underground mine equipment availability and utilisation impacting production at its Leonora operation where the company’s Gwalia Mine is located. Adbri (ASX:ABC) extended its dive today, falling another 4.5%, and Coronado Global Resources (ASX:CRN) dropped 4.4% today.
The most traded stocks today by Bell Direct clients today were Lake Resources (ASX:LKE), the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), and the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ).
US housing starts and building permits data for September will be released tomorrow, with the markets expecting a decline on both metrics from the month of August.
The Australian dollar is buying 62.9 US cents, 55.26 British Pence, 94.09 Japanese Yen and 1 dollar and 11 New Zealand cents.
It was a strong session for US equities overnight, with all three major benchmarks rallying higher. Strong earnings results came in from the banks that boosted the volatile market. The Dow Jones gained 550 points or 1.86%. The S&P500 gained 2.65% and oversold tech names also enjoyed a rebound, with the Nasdaq closing with a 3.43% gain.
What to watch today:
- The SPI futures are suggesting the Australian market rise 0.92% at the open this morning.
- In economic news, today the RBA will release the minutes from its October meeting, when the cash rate was raises a further 25 basis points to 2.6%, while brining borrowing costs to a level last seen mid-2013. It’s not likely the minutes will move markets but it will provide us with some more commentary the RBA’s current position.
- In commodities,
- Oil is trading flat at around US$85 per barrel as China’s continuation of loose monetary policy offset fears of high inflation and energy costs.
- The price of gold is up 0.5%, extending its rebound after hitting a two-week low earlier in the week, as the UK’s decision to reverse unfunded tax cuts lifted market sentiment.
- Seaborne iron ore is down 1%.
- Watch the price movements of Rio Tinto (ASX:RIO) and Hub24 (ASX:HUB). Both companies are set to release a quarterly report today.
- While Endeavour (ASX:EDV), Cochlear (ASX:COH) and Brambles (ASX:BXB) will hole their AGMs today.
Trading Ideas:
- Bell Potter maintain a Buy rating on Coronado Global Resources (ASX:CRN). The companies CY22 guidance implies a strong July- December lift in coal output and corresponding lower costs. And Bell Potter say that CRN will generate strong free cash flow on their met coal price outlook. And in the absence of acquisition or major project developments, the company is likely to return surplus funds to shareholders, and that’s reflected in their strong dividend yield outlook. Bell Potter have increased their price target to $2.20 and at CRN’s current share price of $2.06, this implies 6.8% share price growth in a year.
- And Trading Central have identified a bearish signal in BHP Group (ASX:BHP) indicating that the stock price may fall from the close of $39.09 to the range of $34.40 to $35.30 over 15 days, according to the standard principles of technical analysis.
The local market followed in the footsteps of Wall Street on Friday, with the ASX200 closing the first trading session of the week down 1.4% as every sector ended the day in negative territory, led by a sharp sell-off in energy stocks. The energy sector was weighed down by declining oil prices over the last week.
Embattled casino giant Star Entertainment Group (ASX:SGM) entered a trading halt today after the New South Wales casino regulator slapped the company’s Sydney casino with a record $100 million fine and suspended its licence for compliance failures. Whitehaven Coal (ASX:WHC) shares dipped today after Morgan Stanley reported La Nina weather events present a 5% to 10% production risk to 2023 financial year guidance for mines operating on Australia’s east coast and in South-East Asia. Four of Whitehaven Coal’s mines are located in the Gunnedah Basin of New South Wales, while a number of its other sites are near the Bowen Basin in Central Queensland. Lithium stocks were pushed higher today by the price of lithium carbonate soaring to an all-time high on Friday of 532,000 yuan per tonne, or $118,596.09 AUD. Core Lithium (ASX:CXO) added 5.63%, Liontown Resources (ASX:LTR) jumped 5.5% and Lake Resources (ASX:LKE) rallied 1.74% today.
The winning stocks for today’s session were, Core Lithium (ASX:CXO) amid the rising price of lithium carbonate, Liontown Resources (ASX:LTR) came in as the second top stock of the session and News Corporation (ASX:NWS) rounded out the top the winning stocks for Monday, adding 3.63%. And the stocks investors sold-off today included Adbri (ASX:ABC), which tanked 22% after the company announced a leadership transition regarding the CEO Nick Miller leaving his role as CEO and as a director, as well as a trading update outlining external headwinds set to impact the company’s underlying NPAT for the full year ending December 31. Investors also sharply sold out of Costa Group (ASX:CGC) shares today, with its share price sinking 13% after the company also released a trading update outlining increased costs related to adverse weather conditions. St Barbara (ASX:SBM) rounded out the bottom three performing stocks today, with its share price falling 8.22% to close the session.
The most traded stocks by Bell Direct clients today were Hawsons Iron (ASX:HIO), Bank of Queensland (ASX:BOQ) and the BetaShares Strong Bear Hedge Fund (ASX:BBUS).
Investors will be awaiting the release of the RBA’s meeting minutes out tomorrow to give an indication of future rate hike moves by the country’s central bank.
The Australian dollar is buying 62.18 US cents, 55.09 British Pence, 92.76 Japanese Yen, and 1 dollar 12 cents New Zealand.
The local market soared 1.75% on Friday on the back of the US markets sharp rebound on Thursday, after US headline inflation came in below market expectations of a decline to 8.2% for the month of September, while core inflation jumped to 6.6%, which is a 40-year high. Investor sentiment locally was boosted by the US markets experiencing the biggest turnaround since 2020 from negative to sharply positive territory after CPI data was released. For the week, the ASX lost 0.06%.
Locally, the 2022 favourite energy sector led the charge again on Friday, adding 3.75%, while utilities stocks jumped 3.62% and Consumer Staple stocks rallied 2.04%. All 11-sectors of the ASX ended Friday’s session in positive territory. The winning stocks on Friday were Virgin Money UK (ASX:VUK), which lifted 9.525, Domino’s Pizza (ASX:DMP) added 7.6% and Liontown Resources (ASX:LTR) jumped 7.57%. On the losing end, Pilbara Minerals (ASX:PLS) fell 5.06%, St Barbara (ASX:SB) lost 3.31% and Ramelius Resources (ASX:RMS) ended the day down 3.1%.
The most traded stocks by Bell Direct clients on Friday were the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ), Pilbara Minerals (ASX:PLS) and Whitehaven Coal (ASX:WHC).
Overseas on Friday, US markets closed lower across the key indices on Friday, following the release of big bank earnings reports. The Dow Jones fell 1.3%, the S&P500 lost 2.4% and the tech-heavy Nasdaq took the biggest hit, closing the day down 3%. Investors reacted to a mixed bag of earnings from the big banks with consensus across the big banks indicating the economy is strong now but outlook for the future is uncertain. JP Morgan Chase was one bank that impressed investors in its earnings results with the bank rallying 1.6% on the back of reporting stronger revenues amid higher consumer spending, high interest rates and strong performance on its trading desks. Morgan Stanley on the other hand fell 5% after its reports missed analysts’ expectations for both earnings and revenue.
Over in Europe and the UK, the key indices closed higher on Friday. The FTSE100 added 0.12%, the French CAC jumped 0.9% and Germany’s DAX added 0.67%. Markets in Europe and the UK turned higher after the UK government U-turned on some of its controversial fiscal policies and the country’s finance minister was fired. New UK Prime Minister Liz Truss said on Friday that the government would include a further reversal of tax-cutting plans laid out in the mini-budget on September 23.
What to watch today:
- ASX futures are expecting the local market to open sharply lower, down 1.51% to start the new trading week following on from the sell-off on Wall Street on Friday.
- In economic data, the RBA’s meeting minutes will be released on Tuesday, giving an insight into just how dovish the RBA are toward raising interest rates in future months, and the country’s unemployment rate is out on Thursday. Over in the US, it is a week for building and property market data with building permits and house starts data for September both out on Wednesday and existing home sales data for September out on Thursday.
- On the commodities front, it’s a red start to the week for commodities with Brent Crude oil trading 3.08% lower at US$91.65 per barrel, Gold is trading down 1.34% at US$1643 per ounce, and iron ore is trading flat at US$96.50 per ton.
Trading Ideas:
- Trading Central has identified a bullish signal on James Hardie Industries (ASX:JHX) following the formation of a pattern over a period of 7-days which is roughly the same amount of time the share price may rise from the close of $32.90 to the range of $37.50 to $ 38.50 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Euroz Hartleys Group (ASX:EZL) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share pr
The Aussie share market tumbled 1.78% this week (Mon-Thu), following stronger than expected jobs data in the US. The energy sector was sharply sold off, amid the declining price of oil.
In this week's wrap, Grady covers:
- (0:49) Why retail stocks have been beaten down this year
- (1:45) Holding banks in a rising interest rate environment
- (2:23) Consumer staples businesses that have done well
- (4:00) The biggest movers on the ASX200 this week
- (6:05) The most traded stocks & ETFs by Bell Direct clients
- (6:35) Two economic news items to watch out for
In New York overnight, we saw quite a major reversal in intraday trading. The Dow Jones rose 2.8% or more than 800 points, after being down more than 500 points earlier in the day. It was an impressive rebound, following US inflation data coming in; CPI jumped to a 40-year high and higher than expected, while the country’s headline inflation declined to 8.2%, in line with market expectations. This saw stocks fall to their lowest levels since 2020, before rebounding. The S&P500 posted its widest trading range since March 2020, and closed 2.6% higher, while the Nasdaq closed 2.2% higher. It was the fifth largest intraday reversal from a low in the history of the S&P500, and the fourth largest for the Nasdaq.
What to watch today:
- The Australian market is set jump 1.66% at the open this morning, following Wall Street’s strong lead.
- In commodities:
- The price is oil has jumped over 2%, halting three sessions of declines.
- Gold has dropped to an over two-week low as the US dollar jumped.
- Iron ore has fallen more than 1%, the lowest in nearly 11 months as the looming threats of fresh lockdowns in China’s major cities kept demand for industrial inputs low.
- Harvey Norman (ASX:HVN) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter maintain a Buy recommendation on DroneShield (ASX:DRO), after the company released September Quarter results in-line with expectations. Their price target is $0.24 and at its current share price of $0.17, this implies 40% share price growth in a year.
- And Trading central have identified a bullish signal in West African Resources (ASX:WAF) indicating that the stock price may rise from the close of $1.06 to the range of $1.20 to $1.24 over 20 days according to the standard principles of technical analysis.
The local market followed the global market sell-off overnight to close Thursday’s session down 0.07% as investors fled REIT stocks, sending the sector down 1.87%, while piling into the banks and lifting the financial sector 1.4%.
The story of the day and winning stock of the day was Australia’s national carrier Qantas (ASX:QAN) releasing a group market update outlining strong demand has accelerated the airline’s recovery. The flying kangaroo expects first half profit before tax of between $1.2bn and $1.3bn, which is a sharp recovery from the $1.9bn loss before tax reported for FY22. Qantas also said operational performance continues to improve to expect operations to be back at or around pre-COVID service levels in first half of October, and annual wages for around 20,000 employees will be increased following a two-year wage freeze. Other winning stocks today included Kelsian Group (ASX:KLS) and St Barbara (ASX:SBM) which added 6.3% and 4.1% respectively.
Software company ELMO (ASX:ELO) soared 22% today after the HR tech company confirmed it has received takeover approaches from a number of parties including Accel-KKR, which ELMO has said it is in discussions with some parties in the context of maximising shareholder value.
On the losing end of the market, NIB Holdings (ASX:NHF) tanked almost 12% today following the completion of the company’s $135m institutional placement. Graincorp (ASX:GNC) fell 6.3% today and Allkem (ASX:AKE) also fell 5.56% to end Thursday’s session.
Medibank Private shares entered a trading halt today after the health insurance provider reported a cyber incident, specifically it ‘detected unusual activity on its network yesterday’. The company has engaged specialised cyber security firms to assist with containing and investigating the attack.
Tonight’s big focus is the release of US core inflation data for September which is out at 10:30pm AEDT, with the market expecting US core inflation to drop slightly to 8.1% in September from 8.3% in August.
The Australia dollar is buying 62.78 US cents, 56.60 British Pence, 92.19 Japanese Yen and 1 New Zealand dollar and 12 cents.
The US markets closed lower on Wednesday and the US dollar retreated as investors digested the Fed’s latest FOMC minutes released overnight.
For the most part, the FOMC minutes were in-line with expectations of further aggressive rate hikes by the Fed to come, but investors also noted that many Fed officials ‘emphasised the cost of taking too little action to cool inflation outweighed the cost of taking too much action’ but the Fed’s are aware of the possible consequences of hiking interest rates too rapidly.
The Dow Jones industrials index fell 0.1%, the Nasdaq closed 0.09% lower and the S&P500 ended the day down 0.33%.
Also overnight, the FDA approved new Omicron-targeted COVID-19 booster shots from Pfizer and Moderna for administration in children.
OPEC+ has slashed its forecast for global economic growth and crude oil demand in a move to justify its move last week to cut daily oil production by 2 million barrels per day. OPEC+ said a host of factors including escalating tensions between Russia and Ukraine, rising inflation, and aggressive action by the central banks, were behind its forecasted decline in demand for crude oil.
Over in Europe and the UK, markets extended their sell-off into a 6th consecutive session with Germany’s DAX ending the midweek session down 0.4%, while the French CAC lost 0.25%.
The UK’s FTSE100 was also sold off, ending the day down 0.86%.
On the commodities front, brent crude oil continues to decline this morning, trading 1.84% lower at US$92.56/barrel, gold is trading 0.54% higher at US$1674/ounce and iron ore is trading 0.5% lower at US$97.50/ton.
What to watch today:
- Ahead of the local trading session, ASX futures are expecting the Australian market to open 0.27% lower, weighed down by the global sell-off overnight.
- On the economic data front today, investors will be keeping a close eye on Core inflation data for September in the US which is out later tonight.
- Stocks going ex-dividend today include CPT Global (ASX:CGO) and Katana Capital (ASX:KAT). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Select Harvests (ASX:SHV) following the formation of a pattern over a period of 19-days which is roughly the same amount of time the share price may rise from the close of $5.12 to the range of $5.85-$6.05 according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Mineral Resources (ASX:MIN) following the formation of a pattern over a period of 21-days which is roughly the same amount of time the share price may fall from the close of $70.12 to the range of $57-$60 according to standard principles of technical analysis.
The local market rallied in afternoon trade before sharply declining in the last hour of trade to close just 0.04% higher as a rally for the banks offset a sharp sell-off in utilities and energy stocks. Some relief was also felt for the REIT sector today as real estate stocks edged 1.44% higher at the end of the midweek session. The lacklustre session followed a mixed day on Wall Street as investor sentiment remains on edge ahead of FOMC minutes and core inflation data due out tomorrow.
The mining giants took a hit following a 0.5% decline in the price of iron ore to US$97.5 per ton, while Lake Resources (ASX:LKE) rallied 2% after inking a supply deal to supply battery grade lithium to SK On from the company’s Kachi Project in Argentina. The winning stock was the Bank of Queensland (ASX:BOQ) as it soared 11.13% to have its best session in 2-years after releasing its FY22 annual report outlining key achievements including NPAT up 15% to $426 million for FY22. Coronado Global Resources (ASX:CRN) rose more than 8% today and Sayona Mining (ASX:SYA) regained ground today closing the midweek session up 4.65%.
On the losing end, Mineral Resources (ASX:MIN) fell 3.65% today amid the declining price of iron ore, Nickel Industries (ASX:NIC) lost almost 3.2% and Telix Pharmaceuticals (ASX:TLX) ended the day down just over 3%.
The most traded stocks by Bell Direct clients today were the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), Mineral Resources (ASX:MIN) and Fortescue Metals Group (ASX:FMG).
On the economic data front for tomorrow it is a big day over in the US with the FOMC minutes due out, indicating exactly how hawkish the Fed is toward raising interest rates further moving forward, and Core inflation data in the US is also out which will give an insight into just how successful the Fed’s aggressive interest rate hikes have been at cooling the country’s high inflation.
The Australian dollar has hit a fresh 2.5 year low today, with 1 Aussie dollar buying 62.67 US cents, 65 Euro cents, 56.60 British Pence, 91.74 Japanese Yen, and 1 New Zealand Dollar and 12 cents.
Taking a look at global markets overnight, in the final hours of trade on Tuesday the S&P500 overturned a morning rally to close 0.65% lower, the tech-heavy Nasdaq shed 1.1% and the significant early morning rally for the Dow Jones weakened, causing the industrials index to close just 0.12% higher. Stocks lost momentum in afternoon trade ahead of key inflation data out later in the week that will provide an update on the state of the US economy.
In the UK and Europe, it’s a different story today as investors continued selling out of the markets there on Tuesday with the UK’s FTSE100 ending Tuesday’s session down 1.06%, while in Europe, Germany’s DAX fell almost half a percent while the FRENCH CAC ended the session down 0.13%. European markets were sold-off for a fifth straight session amid persistent investor concerns over global growth, the prospect of further monetary policy tightening and the escalating tensions between Russia and Ukraine. Over the last month investors have pulled 694 million pounds worth of investments in UK shares, Asia-focused equities manager Platinum Asset Management posted $172 million in outflows for September and retail investors locally have pulled $400 million from Magellan Financial Group in the last month amid rising interest rates and the possible recessionary market environment especially for the UK and Europe.
What to watch today:
- Ahead of the new trading day, ASX futures are expecting the local market to open 0.33% lower following the afternoon sell-off on Wall St overnight.
- On the commodities front, brent crude oil continues to decline this morning, trading 1.65% lower at US$94.62 per barrel, gold has rebounded to trade 0.58% higher around US$1677 per ounce, and iron ore is trading flat at US$98 per ton.
- In economic data, there is no local economic data released today but over in the UK investors will be awaiting GDP data for the month of August, while US PPI data for September will be out later tonight.
- Stocks going ex-dividend today include Horizon Oil (ASX:HZN), Regis Resources (ASX:RRL), and WAM Global – Wilson Asset Management (ASX:WGB). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- The Aussie dollar has weakened to buy 62.62 US cents, 56.50 British Pence, 92.06 Japanese Yen and 1 New Zealand Dollar and 12 cents.
Trading Ideas:
- Trading Central has identified a bullish signal on Superloop (ASX:SLC) following the formation of a pattern over a 32-day period, which is roughly the same amount of time the share price may rise from the close of $0.71 to the range of $0.82-$0.84 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Race Oncology (ASX:RAC) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $2.05 to the range of $2.25 to $2.29 according to standard principles of technical analysis.
The ASX succumbed to the pressure of the global market sell-off today, closing Tuesday’s session 0.34% lower despite a morning rally. Investors sharply sold out of energy stocks amid a decline in the price of oil, while also weighing up declining consumer and business confidence data which were released today for September and October respectively. Westpac Consumer Confidence slid almost 1% for October, while NAB Business Confidence data dropped 5 points in September amid difficult business and economic conditions.
The oil and gas mining giants took a hit today on the declining price of oil, with Beach Energy (ASX:BPT) falling 2.5%, Woodside Energy (ASX:WDS) shedding 2% and New Hope Corporation (ASX:NHC) ended the day down 1.2%.
Despite the market closing lower, some stocks made headlines for surging ahead today including John Lyngs Group (ASX:JLG), which recovered 6% of yesterday’s sharp sell-off, while Allkem (ASX:AKE) added nearly 5% and Orica (ASX:ORI) gained 4.4% today.
On the losing side, Sayona Mining (ASX:SYA) was the worst performing stock on the ASX200 today despite no price sensitive news released by the lithium producer today. Imugene (ASX:IMU) continued its sell-off today, losing 5.5%, despite no news out of the company. Megaport (ASX:MP1) rounded out the bottom three performing stocks today, closing just under 5% lower. Baby retailer Baby Bunting (ASX:BBN) shares tanked more than 20% today after the company issued a warning about the company’s gross profit margin as it fell 208 basis points over the PCP to 37.2%. While travel business Helloworld Travel (ASX:HLO) fell 0.5% today, despite the company releasing an update flagging a rebound in travel is imminent as its total transaction value soared 352% in the September quarter to $561m from the same period a year earlier.
On the economic data front for tomorrow there is no local data released tomorrow, however overseas the UK’s GDP data for August will be released tomorrow afternoon and US Producer Price Index data for September will be out later tomorrow night.
The Australian dollar has weakened again, trading at 62.6 US cents, 57.19 British Pence, 91.16 Japanese Yen and 1 New Zealand dollar and 13 cents.
US markets continued to decline on Monday, with the tech-heavy Nasdaq hitting its lowest point in two years led by a sharp sell-off in chip stocks, amid a policy change by President Biden to limit US companies from selling advanced semiconductor and other equipment to China. Tech stocks have also been hit hard lately from their relatively high valuations and the rising cost of borrowings. The Dow Jones industrials index closed just 0.05% lower, the S&P500 lost 0.75% and the Nasdaq fell 1.04%. Stocks extended on last week’s sell-off after JP Morgan warned that the US would likely slump into a recession in 2023 and that it may not just be a mild economic contraction as some economists have projected.
Over in Europe, the global sell-off continued amid growing concerns over economic growth and tightening monetary policy ahead of key inflation data due out next week. Investors are also keeping a close eye on escalations in tension between Russia and Ukraine as the war in the region has intensified in recent days. Germany’s DAX closed Monday’s session flat, the French CAC lost 0.45% and, in the UK, the FTSE100 also ended the day down 0.45%.
On the commodities front, the price of most commodities across the board are down, with brent crude oil trading 2.14% lower at US$95.86 per barrel, natural gas is down 3.5% to US$6.5 per Million British Thermal Units, coal is down 3.75% to US$385 per ton, gold is down 1.54% at US$1668.14 per ounce and iron ore is trading flat at US$98 per ton.
What to watch today:
- Ahead of the local trading session in Australia, the ASX futures are anticipating a 0.18% rise at the opening bell despite the negative start to the week overseas. It could be a difficult session today for oil and gold stocks amid a decline in the price of oil and gold overnight.
- On the economic data front today, we will be keeping a close eye on Westpac Consumer Sentiment data for October and NAB Business Confidence data for September which will both be released this morning, giving an insight into business and market conditions from a business and consumer perspective.
- Stocks going ex-dividend today include Turners Automotive Group (ASX:TRA) and Reece (ASX:REH). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
Trading Ideas:
- Trading Central has identified a bullish signal on Sheffield Resources (ASX:SFX) following the formation of a pattern over a period of 87-days which is roughly the same amount of time the share price may rise from the close of $0.53/share to the range of $0.61-$0.63/share according to standard principles of technical analysis.
- Trading Central has also identified a bearish signal on Ten Sixty Four (ASX:X64) following the formation of a pattern over a period of 24-days which is roughly the same amount of time the share price may fall from the close of $0.60 to the range of $0.47-$0.49/share according to standard principles of technical analysis.
Following the global market sell-off on the back of stronger than expected jobs data out of the US that ended last week on a negative note, the ASX kicked off the new trading week in the red, driven by a sharp sell-off in utilities, technology, and gold stocks today although every sector ended the session lower. At the closing bell, the ASX200 fell 1.4% to 6667.80 points.
Iron Ore stocks avoided the sharp sell-off today amid a rise in the price of the commodity, which saw BHP (ASX:BHP), Fortescue Metals Group (ASX:FMG) and Rio Tinto (ASX:RIO) shares ending Monday’s session in positive territory despite the overwhelming sell-off among all sectors today.
The few winning stocks of today’s session were Sims (ASX:SGM) and Fortescue Metals Group (ASX:FMG), amid the rising price of iron ore and Tabcorp rounded out the top three winning stocks for today. On the losing front, Johns Lyng Group (ASX:JLG) tanked 14.8% today after providing a business update, announcing the company’s Managing Director and Group CEO Scott Didier has sold 4 million shares in the company. Capricorn Metals (ASX:CMM) and Imugene (ASX:IMU) also tumbled more than 10% and more than 7.5% respectively to start the week.
The most traded stocks by Bell Direct clients today were in-line with market movements today, with the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ), Whitehaven Coal (ASX:WHC), and Pilbara Minerals (ASX:PLS).
On the economic data front for tomorrow, Westpac Consumer Confidence data for October is out tomorrow with the market expecting a decline of 2.8% from a rise of nearly 4% in the previous month. NAB Business Confidence data for September is also out tomorrow with the market also expecting a slide from 10 points to 8 points for the month.
The Australian dollar has weakened to buy 63.3 US cents, 92 Japanese Yen and 57.19 British Pence.
Our local market closed 0.8% lower on Friday, dragged down by the real estate, tech and materials sectors, while energy was the only sector to close in the green. It was oil and gas exploration company Karoon Energy (ASX:KAR) that pushed the sector higher, while other stocks that made solid gains included Whitehaven Coal (ASX:WHC), Allkem (ASX:AKE) and Imugene (ASX:IMU).
The most traded stocks by Bell Direct clients were IPH (ASX:IPH), Whitehaven Coal (ASX:WHC) and Mineral Resources (ASX:MIN).
US equities tumbled following a strong US jobs report that pointed to rate hikes. The US unemployment rate for September declined further, to 3.5%. Now while this was as expected, markets consider what this means for the Fed, and a falling unemployment rate sparks a jump in rates, which weighed on stocks. The 2-year Treasury yield rose 6 basis points. And the three major benchmarks dropped. The Dow Jones closed more than 2% lower, or 600 points. The S&P500 down 2.8% and the Nasdaq sharply fell 3.8%.
What to watch today:
• The SPI futures are suggesting the Australian market will drop 0.9% at the open this morning.
• We may see selling of tech stocks today, following the Nasdaq’s drop of almost 4%. So watch tech companies such as Block (ASX:SQ2) and Xero (ASX:XRO).
• In commodities, the price of oil has jumped more than 5%, to a nearly 5-week high, and is trading above US$93 per barrel. OPEC agreed to cut production by 2 million barrels per day, or about 2% of global supply from November. Energy producers will be on watch today, including Santos (ASX:STO) and Woodside Energy (ASX:WDS).Iron ore is trading flat, while the strong US jobs data has put pressure on the gold price, which has dropped almost 1%. So, watch gold miners today.
Trading Ideas:
• Bell Potter maintain a Speculative Buy rating on Frontier Digital Ventures (ASX:FDV) with a valuation of $1.23. At its current share price of $0.67, this implies 82.2% share price growth in a year.
• Trading Central have identified a bearish signal in Ten Sixty Four (ASX:X64), indicating that the stock price may fall from the close of $0.60 to the $0.47 to $0.49 over 24 days according to the standard principles of technical analysis.
The Aussie share market soared 5.30% this week (Mon-Thu), amid the global rally. US core inflation rate for September will be released on Thursday.
In this week's wrap, Grady covers:
- (1:59) Why investors find value in lithium and base-metal companies
- (3:55) The winning sector of the week
- (5:08) The biggest news on the All Ords this week
- (5:39) The most traded stocks & ETFs by Bell Direct clients
- (6:04) Economic news items to watch out for
The local market bucked the overnight sell-off around global markets to close Thursday’s session just 0.03% higher, following the decision by OPEC+ to cut daily oil production in attempt to stabilise prices, which sent local energy shares soaring.
Real Estate stocks took another hit today as interest rates continue to rise, with the latest 0.25% hike announced earlier this week, as the rising rate environment is likely to lead to short-term underperformance in earnings for REIT stocks.
Taking a look at the winning stocks for today’s session, Whitehaven Coal (ASX:WHC) continued its surge, adding 7.17% today, while Pilbara Minerals (ASX:PLS) and Link Administration (ASX:LNK) each added 5.7% and 5.14% respectively.
And on the losing end of the market today, Magellan Financial Group (ASX:MFG) tanked 8% today after the company provided an update for its funds under management for September, showing its FUM continued to decline last month, with retail pulling another $0.4bn and institutions pulling another $3.2bn of funds managed by the embattled fund manager. Kelsian Group (ASX:KLS) and Domain Holdings (ASX:DHG) each also lost more than 3% today.
The most traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), Brainchip (ASX:BRN) and Mineral Resources (ASX:MIN).
Taking a look at economic data, Australia’s trade balance data for August was released today showing the country’s trade surplus declined again in the month of August to hit $8.324bn, which was well below the market expectations of an increase in trade surplus to $10.1bn, in a sign Australia continues to increase imports compared to exports this new financial year. And the Aussie Dollar is trading slightly stronger against the greenback, up 0.39% with 1 Aussie dollar today buying 65.33 US cents.
Overnight, OPEC+ decided at a meeting yesterday to cut oil production by 2 million barrels per day in a move to ‘stabilise oil prices’. This move will actually help Russia fund its war in Ukraine if a price cap is not imposed on Russian oil and it will also push already high oil prices, higher.
What to watch today:
- Taking a look at global markets, the US markets experienced an early rally before closing the midweek session lower across the key indices with the Dow Jones losing 0.14%, the S&P500 shedding 0.2% and the tech-heavy Nasdaq closing the day down 0.25%. The sell-off on Wednesday ended the US markets’ best two-day streak in more than 2-years. The short-lived rally was ended by ongoing investor concerns over the impact rising interest rates will have on both the economy and markets moving forward.
- Adding to investor fears were warnings made yesterday by the World Trade Centre that high energy costs and rising interest rates would fuel a sharp slowdown in global trade next year.
- The global rally from earlier this week also ended in Europe and the UK overnight with Germany’s DAX losing 1.21% and the French CAC closing just under 1% lower on Wednesday.
- In the UK the FTSE100 also faced a sell-off, closing the midweek session down nearly half a percent.
- New Prime Minister Liz Truss closed her party’s annual conference on Wednesday with a pledge of ‘growth, growth, growth’ for the British economy.
- Looking at commodities, Brent crude, the global benchmark of oil, is up 1.9% to US$93.5/barrel following the decision by OPEC+ to cut oil production, gold is trading 0.52% lower at US$1717/ounce, and iron ore is trading flat at US$98/tonne.
- ASX futures are expecting the local market to follow the overnight global sell-off, anticipating an open down 0.4% on the ASX today.
- On the economic data front for today, Australia’s trade balance data will be released at 10:30am Australian Eastern Daylight time, which will detail whether Australia’s trade surplus continued declining in August. The market is expecting a rebound in trade surplus to $10.1bn.
Trading Ideas:
- Trading central has identified a bullish signal on Brainchip (ASX:BRN) following the formation of a pattern over a 41-day period, which is roughly the same amount of time the share price may rise from the close of $0.91 to the range of $1.26-$1.34 according to standard principles of technical analysis.
- And Trading Central has also identified a bullish signal on Bowen Coking Coal (ASX:BCB) following the formation of a pattern over a 21-day period which is roughly the same amount of time the share price may rise from the close of $0.35 to the range of $0.46-$0.48 according to standard principles of technical analysis.
The ASX’s rally extended into the midweek session with the key index closing 1.74% higher today, buoyed by another surge in technology stocks. The only sector to end today’s session lower was consumer staples stocks, which ended the day down just 0.04%.
The big four banks rallied today after all four passed on the RBA’s latest 0.25% rate hike to customers on a variable interest rate loan. CBA also raised its savings rates for customer with Netbank Saver, GoalSaver and YouthSaver accounts.
Taking a look at the winning stocks of the session, Telix Pharmaceuticals (ASX:TLX) soared almost 12% today despite no price sensitive news out of the biopharmaceutical company today. Hub24 (ASX:HUB) also jumped 9.7% today amid the surge in technology stocks. Block Inc (ASX:SQ2) rounds out the top three winners for today’s session, as the fintech company ended the day up just under 7.5%.
Block Inc rounds out the top three winners for today’s session, as the fintech company ended the day up just under 7.5% on the back of a strong session on the Nasdaq overnight for Block shares in addition to a bullish broker note out of Deutsche Bank.
On the losing end of the market, Sayona Mining (ASX:SYA) tumbled 7.8% despite announcing it has launched a Pre-feasibility study for the Moblan lithium project, targeting further expansion of its Quebec lithium base, with the PFS expected to be complete by May 2023. Ramelius Resources (ASX:RMS) fell 4.8% today and Sims (ASX:SGM) lost 3.5%.
The most traded stocks by Bell Direct clients today were BetaShares Strong Bear Hedge Fund (ASX:BBOZ) , Pilbara Minerals (ASX:PLS) and Whitehaven Coal (ASX:WHC).
Final retail sales data for August was released today showing sales rose 0.6% for the month which was in-line with market expectations. A number of Federal Reserve policymakers spoke today, with each pushing the case of the need for the Fed to continue acting aggressively in raising interest rates in the US to cool inflation.
Taking a look at global markets, overnight in the US the three key indices are trading sharply higher just after midday in the US with a few more hours of trade left for Tuesday’s session. The Dow Jones, Nasdaq and S&P500 are each up over 2% today so far. Job Openings in the US fell 10% in August which is a sign the tight labour market is starting to cool.
In the UK, the FTSE100 jumped 2.57% on Tuesday extending the rally in the region after Britain’s decision to ditch part of a controversial tax-cut plan and cool expectations for aggressive central bank rate hikes which returns some confidence to investors.
What to watch today:
- Over in Europe, Germany’s DAX soared 3.78% and the French CAC had the biggest gain of 4.24% on Tuesday.
- The local market soared 3.75% yesterday after the RBA’s interest rate hike came in lower than the markets had expected. And in true big bank style, Nab was the first to pass on the full 0.25% rate hike to its variable loan customers, but is ‘constantly reviewing’ the rate hike for its term deposit clients.
- Taking a look at commodities, Brent crude oil prices have fallen 25% over the September 2022 quarter to US$86/bbl, the lowest level since Russia’s invasion of Ukraine. Concerns of slowing economic growth and China’s ongoing pursuit of zero COVID-19 cases remain, underpinning a weak short-term demand outlook for crude oil. An OPEC+ meeting is scheduled this Wednesday; reports suggest the organisation will consider cutting daily production rates by 1MMbbl/day (around ~1% of world supply) to “stabilize prices” which has seen brent crude oil up more than 4% this week, trading at US$91.457/barrel. Iron ore is trading flat at US$98/tonne, gold is up 1.37% at US$1722.46/ounce, and natural gas is trading 5.82% higher.
- ASX futures are expecting the local market to open sharply higher by 1.4% amid the global rally and to extend on yesterday’s surprise RBA rate hike decision-fuelled rally locally.
- On the economic data front for today, there is no local data released today however overseas in the US investors will be eager to see America’s trade balance data for August to determine whether the world’s largest economy continued importing more than it exported for that month, with the market expecting a slight improvement on the trade deficit to -US$67.7bn.
Trading Ideas:
- Trading Central has identified a bullish signal on QBE Insurance (ASX:QBE) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $11.79 to the range of $12.80-$13.10 according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 16-days which is roughly the same amount of time the share price may rise from the close of $0.68 to the range of $0.77-$0.79 according to standard principles of technical analysis.
A good day on the ASX today with the local market soaring on the back of the global rally overnight and of course the RBA’s surprise interest rate hike of just 0.25% or 25 basis points which was below the expected 0.5% rise markets were anticipating.
RBA treasurer Jim Chalmers said despite the rate hike being less than expected, the 25 basis rate rise won’t make it much easier for Australians. In true big bank style, NAB has already announced it will raise its variable lending rates by 0.25% in response to the RBA’s rate hike today, passing on the full interest rate rise to customers. As a result of the lower-than-expected rate hike, the local market soared to close the session up 3.75% with every sector ending the day in positive territory.
A surge in technology stocks led the market gains today as tech stocks are heavily reliant on borrowings to build their businesses in the growth stage, therefore the RBA’s announcement of the rate hike coming in under expectations gives some borrowing relief for technology stocks.
Investors piled into emerging lithium producer Sayona Mining today after the company announced it is fast-tracking plans to move downstream in Quebec, with the launch of a pre-feasibility study by Sayona Quebec to consider the potential for lithium carbonate production at the North American Lithium Operation.
Lithium stocks across the board rallied today following the release of the Industry Department’s latest quarterly Resources and Energy report outlining that 75% of the world’s lithium consumption goes into rechargeable batteries and EV sales expected to grow tenfold over the next decade which places Australia, the world’s biggest exporter of lithium, in a good position to produce 46% of the world’s lithium supply. Lake Resources (ASX:LKE) led the ASX200 gains today, jumping 14.5%, while Pilbara Minerals (ASX:PLS) added 12.31%.
And on the losing front, it was just Lottery Corp (ASX:TLC) on the ASX200 that posted a slim loss of 0.24% today.
The top traded stocks by Bell Direct clients today were BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), Pilbara Minerals (ASX:PLS), and ANZ (AXS:ANZ).
On the economic data front, US JOLTs job openings for August data will be released overnight, while local investors will be anticipating the release of Australia’s trade balance data for August which is out on Thursday to see whether the country’s export surplus continued declining for the month.
The US Market has started the new month and quarter on an upbeat note as weaker than expected manufacturing data prompted investors to rethink how aggressive the Fed’s upcoming interest rate hikes will be as the economy is starting to show small signs of slowing. The Dow Jones industrial Index posted the biggest gain of 2.66% at the Closing Bell, while the tech-heavy Nasdaq closed 2.3% higher, and the S&P500 added 2.6%.
US government bonds also rallied sharply on the first trading day of the fourth quarter with the yield on the 10-year Treasury note sliding 0.18 percentage points as it’s price rose. Lawmakers in Russia’s lower House of Parliament have unanimously approved moving forward with absorbing full Ukrainian territories captured into Russia despite battlefield setbacks and a lack of control over the four new areas. Ukrainian President Volodymyr Zelensky has vowed to retake all land seized from his nation.
Watch to watch today:
- The new month rally extended into Europe with Germany’s DAX adding 0.8%, and the French CAC lifting 0.55% to start the new month.
- Over in The UK, the FTSE100 followed the global rally but investors were less confident, with the UK’s key index closing Monday’s session just 0.22% higher.
- The rally was fuelled by new UK Prime Minister Liz Truss saying the UK economy needs a reset and has pledged to prioritise ‘aspiration, enterprise and growth’. Ms Truss’ government also scrapped plans to reduce taxes on the UK’s higher earners.
- Taking a look at commodities, Brent crude settled 4.08% higher at US$88.61/barrel, gold is trading 2.43% higher at just under US$1700/ounce, but iron ore is down almost 3% at US$98/tonne.
- Ahead of the local trading day, ASX futures are expecting the Australian market to open sharply higher by 1.58% buoyed by the global rally overnight.
- On the economic data front, investors will be keeping a close eye on the RBA’s interest rate decision for Australia’s cash rate this month which is out at 1:30pm eastern daylight savings time today. New home loans and building permits data for August are also released today which will give an insight into the country’s building and property market for August.
Trading Ideas:
- Bell Potter has maintained a buy rating on Cogstate (ASX:CGS) and increased its price target on the neuroscience technology company from $1.95/share to $2.20/share driven by a modest decline in weighted average cost of capital due to decreased risk associated with future earnings, FDA regulatory approval and CMS imbursement and the evolving clinical trial execution of the Eisai strategy involving its ‘Dementia Ecosystem’.
- And Trading Central has identified a bearish signal on Ridley Corp (ASX:RIC) following the formation of a pattern over a 33-day period, which is roughly the same amount of time the share price may fall from the close of $1.99 to the range of $1.70-$1.76 according to standard principles of technical analysis.
The Australian market see-sawed between positive and negative territory today before closing the first trading session of the week down 0.27%, as a sharp sell-off in technology stocks weighed on the key index amid rising global recession fears among investors. The energy sector was boosted today by an increase in oil prices as OPC+ considers cutting oil production.
The stocks that led the market gains today were Capricorn Metals (ASX:CMM) which lifted 3.33%, Origin Energy (ASX:ORG) added 2.9% and Iluka Resources (ASX:ILU) ended the day up 2.87%. Biotechnology company Mesoblast (ASX:MSB) also jumped more than 8% today after providing an update on its application to the US FDA, outlining the company has supplied the FDA with ‘substantial new information’ on the use of remestemcel-L in the treatment of children with steroid-refractory acute graft versus host disease. The information was supplied in response to the Complete Response Letter received from the FDA in September 2020 and is a ‘major milestone’ for Mesoblast’s complete response to the FDA.
And the stocks that weighed down the market, dragging the key index to the negative close today were West African Resources (ASX:WAF) which tumbled 10% today after providing an update on its operations in Burkina Faso to share that following a change in the military leadership in Burkina Faso over the weekend, its staff and contractors are safe, and the company’s Sanbrado Gold Operations continue to operate as normal. The political situation appears to be due to internal disagreement within the Burkina Faso military leadership, with the company saying it is continuing to monitor the situation.
Core Lithium (ASX:CXO) also declined more than 7% during the session today after the company completed its underwritten Placement of ~97.1m shares at $1.03/share to raise $100m. And Ramelious Resources (ASX:RMS) fell 5.6% today.
The top traded stocks by Bell Direct clients today were Vanguard Australian shares index ETF (ASX:VAS), Brambles (ASX:BXB) and Macquarie Group (ASX:MQG)
The dreaded RBA rate decision day is tomorrow, with investors anticipating just how dovish or hawkish the RBA will be when deciding the nation’s interest rate hike for October. Data for New home loans generated in the month of August is also out tomorrow which will give an insight into Australia’s property sector, with the market expecting a decline of 3.5% for the month.
The local market’s rally on Thursday was short lived with the key index closing Friday’s session down 1.23%, down 1.53% for the week, and plunged 7.5% for the month of September amid the global sell-off as recession fears mount in the US. Several policy makers spoke late last week signalling further rate hikes are required for the foreseeable future to cool inflation into the target range.
Nine of the eleven sectors on the ASX closed Friday’s session in negative territory, while Gold mining stocks offset some of the markets sell-off by surging more than 3.5% amid a rise in the price of the precious commodity and on the back of the Bank of England’s decision to buy $65bn pounds worth of UK government bonds to stabilise the UK pound.
The winning stocks on Friday were Capricorn Metals (ASX:CMM) which added 8.70%, Silver Lake Resources (ASX:SLR) jumped 7.27% and Regis Resources (ASX:RRL) lifted just under 7%.
On the losing front, Carsales.Com (ASX:CAR) took the biggest hit on Friday, ending the day down 7.8% amid sliding investor sentiment in tech and growth stocks. Cochlear (ASX:COH) also shed 6.6% despite no price sensitive news released by the medical device company, and Wisetech Global (ASX:WTC) fell 5.6% also due to the broad tech sell-off and on the back of global shipping volumes declining, showing slowing growth for the sector Wisetech operates in.
The most traded stocks by Bell Direct Clients on Friday were BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), Macquarie Group (ASX:MQG) and New Hope Corporation (ASX:NHC).
What to watch today:
- Overseas on Friday, the global market sell-off continued, with US stocks recording the longest run of quarterly declines since the GFC in 2008. The Dow Jones industrial index and the tech-heavy Nasdaq closed out the third quarter with their heaviest losses of the year, down 1.7% and 1.5% respectively, while the S&P500 notched out its third straight quarterly loss, ending Friday’s session down 1.5%. Investor sentiment has been increasingly dampened of late following the Fed Reserve’s aggressive rate hikes in attempt to cool the nation’s red-hot inflation, that remains stubbornly high.
- Over in Europe, new data released shows the Eurozone inflation rate hit 10% in September as Russian efforts to slim the regions gas supplies drove energy prices higher. Despite European markets ending Friday’s session higher, with Germany’s DAX up 1.16% and the French CAC adding 1.5%, the pan-European STOXX600 had it worst performing month since June, declining 7.8% over September as global markets struggle to overcome investor fears of slowing growth and possible recession.
- The Bank of England intervention-fuelled rally cooled on Friday with the FTSE100 closing Friday’s session just under 0.2% higher for the day amid the global sell-off. Retail stocks in the UK were hardest hit, with Next Chief Executive Simon Wolfson offering some support for the UK government’s tax cut policies, but told the Standard he fears the borrowing costs they will incur.
- Ahead of the local trading day today, the ASX futures are expecting the market to open just 0.08% higher to start the new month in positive territory.
- Taking a look at economic data, investors will be anticipating the release of the RBA’s latest interest rate decision out on Tuesday to determine if the central bank really is committed to lower interest rate hikes, or whether the latest set of aggressive global interest rate hikes will prompt the RBA to follow suit.
- On the commodities front, crude oil has plunged 1.88% to trade at US$79.70/barrel, Brent is down 2.1% to trade at US$85.35/barrel, Gold is trading just 0.01% higher at US$1660.52/ounce while iron ore is down almost 3% at US$98/tonne.
- And to start the new trading week off, let’s dive into some trading ideas for your consideration.
Trading Ideas:
- Trading
Investors are steering clear of the real estate sector around the world. Locally, the Aussie share market declined 0.3% this week (Mon-Thu), despite the rally later in the week. Energy stocks took a hit as commodity prices plunged with many seeing a buying opportunity.
In this week's wrap, Grady covers:
- (0:13) What happened to REIT stocks this week
- (2:59) The ASX dipping to a three-month low
- (3:44) Why energy stocks took a hit
- (4:09) The biggest news on the All Ords this week
- (4:41) The most traded stocks & ETFs by Bell Direct clients
- (5:09) Two economic news items to watch out for
As recession fears continue, there was a broad market sell-off overnight. In the US, the sell-off was led by Apple, which dropped after a major investment bank downgraded the tech giant. This saw the Nasdaq tumble 2.8%, while the Dow Jones dropped 1.5% and the S&P500 closed with a new low for the year, down 2.1%. The major averages are on track for a losing week and a month of losses, with the Nasdaq leading the months losses, down 9% for September.
What to watch today:
- Following US equities overnight, the SPI futures are suggesting our local market will drop 0.34% at the open this morning.
- And following the Nasdaq’s sharp drop, keep watch of ASX-listed tech stocks today, as they may mirror the overnight sell-off.
- Today continue to watch AGL Energy (ASX:AGL), after yesterday announcing it’s fast tracking its exist from coal.
- In commodities, oil is trading lower, so watch energy producers such as Beach Energy (ASX:BPT) and Woodside Energy (ASX:WDS). The price of gold edged higher overnight, which may boost gold miners such as St Barbara (ASX:ASB) and Newcrest Mining (ASX:NCM), while iron ore is trading flat.
- And we may see the price of Nick Scali (ASX:NCK) fall, as the stock is set to go ex-dividend today.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Boss Energy (ASX:BOE), after the company reported full year 2022 results, ahead of Bell Potter’s expectations at the NPAT level, and in-line with their EBITDA estimates. They’ve increased their valuation from $3.32 to $3.51. At BOE’s current share price of $2.35, this implies 49.4% share price growth in a year.
- Trading Central have identified a bullish signal in Medibank Private (ASX:MPL), indicating that the stock price may rise from the close of $3.52 to the range of $3.85 to $3.93 over 22 days, according to the standard principles of technical analysis.
The local market followed the global overnight rally to close the second last trading session of the week up 1.44%, driven by a surge in energy and materials stocks. Every sector of the local market closed in positive territory today as investor sentiment both locally and globally is boosted by the Bank of England’s promise to buy $65bn pounds of sterling bonds to stabilise the UK’s bond market. Energy stocks led the markets higher today following the European Union’s renewed push for further sanctions on Russian commodities, and the subsequent sharp rise in commodity prices earlier today.
A number of big announcements were released today that impacted specific company share prices, including Premier Investments releasing FY22 results including record dividends and a strong start to FY23 with sales up globally by 46% already.
AGL Energy (ASX:AGL) also announced today it is fast tracking its exit from coal by closing Australia’s biggest-emitting power plant 10-years earlier than previously planned which is expected to reduce AGL’s annual greenhouse gas emissions from 40 million tonnes to net zero on achieved target closure.
Taking a look at the best performing stocks today, Premier Investments soared 14.6% today on the release of strong FY22 results, Coronado Global Resources (ASX:CRN) also added more than 8% and De Grey Mining (ASX:DEG) finished the session 6.7% higher. On the losing front, IRESS (ASX:IRE) hand plunged 17% today after downgrading its full-year profit guidance due to ‘macro conditions’, with the company now expecting profit for the financial year to be between $166m-$170m, down from the original guidance of $177m-$183m. Bega Cheese (ASX:BGA) fell 1.41% today and Karoon Energy (ASX:KAR) declined 1.4%.
The most traded stocks by Bell Direct clients today were New Energy Solar (ASX:NEW), BetaShares Geared Australian Equity hedge fund (ASX:GEAR) and Whitehaven Coal (ASX:WHC).
On the economic data front, the release of early indication CPI data for August out showing the country’s inflation rate is expected to rise 7% in the year to July and 6.8% to August. The information released provides an early indication of September quarter CPI inflation that will be published later in October. The largest contributors to inflation in August were new dwelling construction up 20.7% and automotive fuel up 15%. The slight fall in inflation from July to August is mainly due to a decrease in prices for automotive fuel. The 6.8% rise for August shows the country’s inflation is not accelerating.
The Australian market reversed early gains on Wednesday to close the midweek session 0.5% lower, as investor concerns over the RBA further tightening Australia’s monetary policy were enhanced after stronger-than-expected retail sales were reported for August, up 0.6% to $34.88 billion. The higher-than-expected retail sales support the case for the RBA to raise interest rates by another 0.5% at the next meeting on Tuesday. Tech stocks took the biggest hit on Tuesday, declining 1.6% as a sector while Utilities rose almost 2%.
The winning stocks for the midweek session were Coronado Global Resources (ASX:CRN), which added 5.9%, while Ramelius Resources (ASX:RMS) jumped 5.4% and Whitehaven Coal (ASX:WHC) extended its rally, adding another 3.9%. On the losing end of the market, Telix Pharmaceuticals (ASX:TLX) plunged 15.40% after the biopharmaceutical company announced a big blow to its global expansion with the company withdrawing its Marketing Authorisation Application for its Illucix drug in Europe based on regulators requesting additional Chemistry, Manufacturing and Control data which Telix says cannot be delivered within the prescribed review timeframe. Investors also sold out of Core Lithium (ASX:CXO) shares yesterday as investors may be taking profit from the company’s surge of 175% over the last year.
Imugene rounded out the bottom three stocks for Wednesday, ending the day down 5.3%.
The most traded stocks by Bell Direct clients yesterday were the BetaShares Geared Australian Equity (Hedge Fund) (ASX:GEAR), Silver Lake Resources (ASX:SLR) and South32 (ASX:S32).
Overseas, it was a positive day across most major markets following a move by the Bank of England to put a floor on UK assets overnight. The BoE is stepping in to buy $65 billion pounds of sterling bonds to stabilise the UK bond market, with investors confident that the UK government can pay back their debt, after the new government’s tax cut promise triggered the biggest sell-off in decades. The FTSE100 ended the midweek session up 0.3%. Over in New York the three key indices posted strong gains on Wednesday amid the recovery in the British pound, while retail investors remain interested in Apple and Tesla shares. The Nasdaq posted the greatest gain of 2.05%, while every sector of the S&P500 closed higher with the index adding 1.97%, and the Dow Jones rallied 1.88%.
Germany’s DAX and the French CAC also followed suit, each adding 0.36% and 0.19% respectively. The European Union is proposing a new set of sanctions against Russia. The package would affect $7 billion Euros of Russian exports and would ban the sale of new technologies to Russia and they’d also start paving the way for an international price cap on Russian oil.
What to watch today:
- Commodities have sharply rebounded overnight following the European Union’s proposed new sanctions on Russia, with the price of Crude oil rocketing 4.31%, while Brent is up 3.21% at US$89.04 per barrel, Natural gas is 3.31% higher and gold is up almost 2% at US$1660.50 per ounce.
- Ahead of the local trading day, ASX futures are anticipating the market to bounce back from its red-close on Wednesday to trade sharply higher by 1.52% at the opening bell on Thursday amid boosted sentiment in markets around the world.
- The stocks trading ex-dividend today are Link Administration Holdings (ASX:LNK), Sigma Healthcare (ASX:SIG), and Energy One (ASX:EOL), which could be a good opportunity to buy in if you have been thinking about these stocks as stocks going ex-dividend generally trade lower on the ex-dividend date.
- On the economic data front, today there is no local data released however investors will be awaiting the release of US initial weekly jobless claims to gain insight into America’s tight labour market. A number of Fed officials also deliver speeches today which could sway investment decisions on Thu
US markets were mixed overnight following a number of Federal Reserve policymaker speeches showing an increased appetite for further rate hikes even at the risk of throwing the economy into a recession. The Dow Jones industrial index ended the session down 0.43% and the S&P500 lost 0.21% to hit a two-year low, but the tech-heavy Nasdaq posted a gain of 0.25%. Over in London, stocks on the FTSE 100 were knocked down by rate rise worries as the central bank may look to raise rates further to support the hammered British pound, with the index closing the session down 0.52%. The global market sell-off extended into Europe with Germany’s DAX and the French CAC declining 0.72% AND 0.27% respectively on Tuesday.
What to watch today:
- Russia’s rationing of natural gas and energy commodity withdrawal to Europe continues to fuel concerns over an energy crisis in the region, which led to a rally for local energy sector on Tuesday especially for coal producers. Russia’s moves to ration and withdraw commodities from Europe have caused countries in the region to invest more in coal to keep the electricity on in the region as winter fast approaches. ASX-listed coal mining and energy stocks have benefitted from the growing energy crisis in Europe by signing commodity supply deals.
- Taking a look at the turbulent commodity prices, over the last few days we’ve seen a rebound with brent crude oil now trading 2.6% higher around US$86.2 per barrel, coal is up 0.64% around US$438 per MT, but natural gas is down 3.14%. The recent dive in gold prices eased overnight as the dollar rally took a breather, with the price of the precious metal trading 0.66% higher at US$1,632 per ounce.
- Ahead of the local session today, the ASX futures are expecting the local market to follow the global sell off, anticipating a 0.68% decline when the market opens.
- Stocks going ex-dividend today include Myer Holdings (ASX:MYR) and Cedar Woods Properties (ASX:CWP). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- There is no local economic data set to be released today, but over in the US New Home Sales data for August was released overnight at a 5-month high of 685K for the month, which is an increase of 28.8% on July and beat market expectations of 500K.
Trading Ideas:
- Bell Potter has initiated coverage of DroneShield (ASX:DRO) with a Speculative Buy rating on this stock and a price target of $0.24 per share, for the reasons that Bell Potter believes DRO is well placed to capitalise on favourable macroeconomic conditions accelerating structural growth in the market, with the strong sales pipeline identified by the company demonstrating long-term demand. The rating and price target are also based on the fiscal support DRO receives from the Australian government’s $270 billion funding for domestic defence, comprehensive product offering by the company and opportunity for growth in adjacent markets.
- Trading Central has identified a bearish signal on Orora (ASX:ORA) following the formation of a pattern over 334 days which is roughly the roughly period the of time in which the target price range between $1.95 and $2.15 may be achieved, according to standard principles of technical analysis.
The local market took no lead from Wall Street’s overnight sell-off, as the ASX closed Tuesday’s session 0.41% higher, led by a rally for materials stocks, which boosted the key index to a positive close.
Oil and gas giant Santos (ASX:STO) today announced it received a binding conditional offer from Papua New Guinea’s national oil and gas company, Kumul Petroleum to acquire an additional 5% project interest in PNG LNG for asset value of US$1.4 billion, including a proportionate share of project finance debt of approximately US$0.3 billion. Should the deal be approved, Kumul Petroleum will own 22% of PNG LNG while Santos’ shareholding will drop to 37.5%. Shares in Santos (ASX:STO) rose 1% today.
MetalsGrove Mining (ASX:MGA) skyrocketed 61% today after announcing significant lithium pegmatite potential has been identified at the company’s Upper Coondina Lithium Project in Western Australia during pre-drilling surface mapping at the site.
A rally for coal miners today was due to ongoing concerns of a European energy crisis as the continent faces a shortage of gas and coal following Russia’s energy commodity withdrawals and rationing since earlier this year. Whitehaven Coal (ASX:WHC) and New Hope Corporation (ASX:NHC) each added over 6% today.
Taking a look at the best performing stocks today, BrainChip (ASX:BRN) jumped 7.23%, Megaport (ASX:MP1) added almost 7% and Pilbara Minerals (ASX:PLS) shared climbed just over 6%. And the stock hit the hardest by investors selling out today was Core Lithium (ASX:CXO), which fell more than 5.5% despite the company releasing a business and drilling update today including the Finniss operations uncovering first spodumene Ore in September and the BP33 exploration having high-grade spodumene bearing pegmatite intersected in multiple holes. Fisher and Paykel Healthcare (ASX:FPH) also lost almost 5% today while Ramsay Healthcare (ASX:RHC) fell 3.5%.
The most traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), New Energy Solar (ASX:NEW) and the BetaShares US Equities Strong Bear Hedge Fund (ASX:BBUS).
Taking a look at economic data, US durable goods orders data for the month of August is out tonight, with the market expecting a decline of 0.4% after a decline in orders for transport equipment weighed down US durable goods orders in July.
US new home sales for August data is also out at midnight tonight, giving an insight into the current condition of the property market in the US amid the Fed’s aggressive interest rate hike strategy to curb the country’s inflation.
Trading overnight was quite volatile for the first session of the week in New York. US equities were sold off towards the end of the day and all three major averages closes in the red. The Dow Jones fell into bear market territory, down 1.1%. It’s down approximately 20% from its closing high on the 4th of January. The S&P500 notches a new closing low for 2022, declining 1.03% to 3,655; that’s below its June closing low of 3,666. And the tech heavy Nasdaq dropped 0.6%.
What to watch today:
- Despite the risk-off sentiment across global equity markets this week, the SPI futures are suggesting that the Australian market will rise 0.26% at the open this morning.
- Commodities however are a sea of red:
- Oil prices have dropped almost 3% to a near 9-month low, amid concerns that monetary tightening by central banks worldwide would dampen energy demand and derail global growth.
- Gas, copper, zinc and nickel are all trading lower.
- The price of gold hit its lowest level since April 2020, due to a rallying US dollar and surging Treasury yields. However, iron ore has notched slightly higher, trading up 0.5%.
- Companies set to release their earnings results today include Core Lithium (ASX:CXO) and De Grey Mining (ASX:DEG).
- The ASX (ASX:ASX) is set to hold its AGM today.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Clarity Pharmaceuticals (ASX:CU6) with a price target of $1.00. At its current share price of $0.65, this implies 53.8% share price growth in a year.
- And Trading Central have identified a bearish signal in Newcrest Mining (ASX:NCM), indicating that the stock price may fall from the close of $15.76 to the range of $14.80 to $15.10, over 16 days according to the standard principles of technical analysis.
The Australian market dipped to a 3-month low during today’s session amid global recession fears, oil prices diving and the US dollar surging to a fresh-peak. The ASX200 closed the first trading session of the week down 1.6%.
The ASX was also sold-off as the UK pound nosedived to a new record low US$1.035 on the promise of new tax cuts in the UK’s mini-budget as investors fear a surge in government borrowing to pay for the huge tax cuts.
The energy sector which is leading the gains in 2022, was hit hard today with the sector experiencing its worst session since March 2020, as oil prices continue to plunge. The price of brent is down a further half a percent today at US$85.76 per barrel, while crude oil is down 0.54% at US$78.31 per barrel today. Whitehaven Coal (ASX:WHC) led the losses on the energy sector, down 11% today, wiping off some the coal producers’ recent gains.
The winning stocks today were Nanosonics (ASX:NAN), Megaport (ASX:MP1) and REA Group (ASX:REA), which are part of the technology sector that gained more than 1% today. And on the losing side, New Hope Corporation (ASX:NHC) took the biggest hit today, diving almost 15%, followed by Costa Group (ASX:CGC) plunging just over 14% today after the company announced it is back on the hunt for a new CEO just 18-months after Sean Hallahan will step down with effect from today, September 26, 2022, just 18-months after the biggest leadership change in ASX history.
The most traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), Argosy Minerals (ASX:AGY), and BHP Group (ASX:BHP).
On the economic data front, it’s a slow week for the release of any economic data that will come as a slight relief for investors who have been very responsive to crucial economic data that has been released of late.
The Australian market closed Friday’s session sharply lower, down 1.87% with all 11-sectors of the index closing in negative territory, following the Fed’s latest interest rate hike in the US causing investors to flee stocks in favour of cash in markets around the world. The riskier sectors such as consumer discretionary and tech stocks took the biggest hit on Friday, with those two sectors closing the session down 4.44%.
The winning stocks on Friday were New Hope Corporation (ASX:NHC), Whitehaven Coal (ASX:WHC) also extended its green-run of late and Rio Tinto (ASX:RIO) closed Friday almost 2% higher. On the losing side, Block (ASX:SQ2) formerly known as Square fell almost 9% on Friday amid the tech and growth stock sell-off, while Xero (ASX:XRO) and Arena REIT (ASX:ARF) also each lost 7.8% and 6.8% respectively.
The most traded stocks by Bell Direct clients on Friday were Macquarie Group (ASX:MQG), Terracom (ASX:TER) and the Vanguard Australian Shares Index ETF (ASX:VAS).
Overseas, the US markets were sharply sold off on Friday as investors continue responding to the Fed’s latest 0.75% interest rate hike. The Dow Jones closed at a new 52-week low, down 1.62%, the Nasdaq lost 1.8% and the S&P500 fell 1.72%. Bond yields jumped last week around the world as a result of rising interest rates, which signals a warning of market distress as higher bond yields create more capacity for funds that may otherwise go into the stock market. The Bank of England also raised the UK’s interest rate by 0.5% to 2.25% to tackle the UK’s worst bout of inflation in 40-years. As a result, the FTSE100 and UK markets were sold off, with the FTSE100 closing Friday’s session down almost 2%. Germany’s DAX closed the last trading session of the week also down 1.97% and the French CAC took the biggest hit, down 2.28% on Friday.
What to watch today:
- Ahead of the local trading day, markets are expecting a sharp 1.25% decline upon open as investor sentiment is dampened by rising interest rates around the world.
- The stock going ex-dividend today is IMDEX Limited (ASX:IMD), which could be a good opportunity to buy in if you have been thinking about these stocks as stocks going ex-dividend generally trade lower on the ex-dividend date.
- Taking a look at commodities, global recession fears have caused commodity prices to plunge with crude trading at an eight-month low, down 5.7% around US$78.74 per barrel, brent is down 4.15% at US$86.71 per barrel, gold is down 1.6% lower at US$1643 per ounce, while iron ore is up 0.5% at US$101 per tonne.
- There is no economic data released today but US durable goods orders for August is out on Tuesday while New Home Sales data in the US for August is released on Wednesday.
Trading Ideas:
- Trading Central has identified a bullish signal on Technology Metals Australia (ASX:TMT) following the formation of a pattern over a period of 69-days indicating the stock price may rise over this same amount of time from the close of $0.35 per share to the range of $0.48 to $0.52 according to standard principles of technical analysis.
- Bell Potter has downgraded its price target on Catapult Group (ASX:CAT) to $1.10 from $1.00 but maintains a hold rating on the global sports analytics company amid downgraded revenue forecasts over the coming financial years as well as market movements and lower expected top line growth.
US equities closed in the red for the third straight day, as mounting fears that the Federal Reserve’s aggressive rate hikes will push the economy into a recession. The session put the major averages on pace to close the week with losses. The Dow Jones closed 0.35% lower, the S&P500 down 0.8% and the Nasdaq down 1.4%. Investors have been selling stocks following another rate hike from the Fed on Wednesday night. Bond yields surged again – the yields on the 10-year and 2-year Treasury notes notching fresh multiyear highs, hitting their highest levels since February 2011 and October 2007 respectively.
European stocks ended the day lower, after central banks in Switzerland and the UK, announced interest rate hikes. The Bank of England raised interest rates by 50 basis points, its seventh consecutive hike.
What to watch today:
- The Australia market is set to fall 0.26% at the open this morning.
- In commodities, oil is trading higher, recovering from two consecutive sessions of losses, as hopes of higher Chinese demand and geopolitical tensions, more than offset global growth worries. Gold is in the red, sliding back towards the lowest levels in over two years. And iron ore has dropped to its lowest in nearly 10 months.
- Watch the share price movements today of Chalice Mining (ASX:CHN), which is set to release its earnings results today, and of Suncorp (ASX:SUN), which is set to hold its AGM today.
- Stocks going ex-dividend today include Vita Life Sciences (ASX:VLS) and Vulcan Steel (ASX:VSL).
Trading Ideas:
- Citi maintain a Buy rating on building products and services company Brickworks (ASX:BKW). The company’s financials beat market consensus, with underlying profit rising by 159% on last year. While uncertainty is rising in the macro-outlook, Citi note that Brickworks management are confidence of growth with the property business in FY23. BWK’s current share price is $21.69. If BKW meets the Citi price target of $26, it will return approximately 20%.
The local market dipped to a two-month low during today’s session before closing the day down 1.56% at a new 20-day low of 6700.20 points. The key index was weighed down by the materials, real estate and utilities sectors each falling more than 2% today, however every sector ended the midweek session in negative territory as investor sentiment was dampened by the global market sell-off overnight ahead of the Fed’s interest rate decision out tomorrow.
Coal miners have been on a run this week, none more so than Whitehaven Coal (ASX:WHC), with the company’s shares surging to a record high $9.16 during today’s session. Investors piled in after the coal miner issued a notice of AGM to its shareholders which includes two resolutions seeking shareholder approval to extend the company’s share buy-back programme. For the year, WHC reported WHC is on-track to complete the 1st buy-back ahead of its AGM, where it will seek further approval for an on-market buy-back and an off-market buy-back, which if approved will give the board authorisation to acquire up to 240m shares in aggregate.
Looking at the best performing stocks today, Washington H Soul Pattinson jumped almost 5% today after releasing FY22 results including cash flows from investments up 93%, net asset value up 71.6% and group regular profit after tax up 154.4%.
Viva Energy (ASX:VEA) shares also rose 4.56% today, while Whitehaven Coal added almost 4%. On the losing side, Imugene (ASX:IMU) tanked 8% today despite announcing that its first patient has been dosed as part of intravenous cohort 1 in the Phase 1 MAST study evaluating the safety of novel cancer-killing virus CF33-hNIS (VAXINA). Sayona Mining (ASX:SYA) and Charter Hall (ASX:CHC) also each fell more than 5% today.
The most traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), Block (ASX:SQ2), and Argosy Minerals (ASX:AGY).
On the economic data front, at 4am Australian eastern time tomorrow the Fed’s latest interest rate decision will be released, which has caused investor confidence to slump this week as markets are torn between expecting a 0.75% and 1% rate hike. Later tomorrow, the Bank of England will release its interest rate decision for the UK, with the market expecting a rise to 2.25% from the current 1.75%.
Taking a look at the markets overnight, in the US it was a choppy session that ended lower across the key indices as investor confidence slumped ahead of the release of the Fed’s interest rate decision out on Wednesday US time, Thursday our time – the Dow Jones closed Tuesday’s session 1.65% lower, the S&P500 lost 1.62% and the tech-heavy Nasdaq shed almost 1.5%. US housing momentum also fell for a ninth straight month in August as US mortgage rates climbed.
The sell-off continued over in the UK and Europe with the FTSE100 losing 0.61% on Tuesday, while Germany’s DAX fell more than 1% and the French CAC shed 1.35%.
What to watch today:
- Locally, the RBA’s meeting minutes released yesterday boosted investor confidence that the RBA is a global outlier in pushing ahead with a slower rate of interest rate hikes, a move that other central banks are not even considering yet. Investor sentiment was dampened in recent weeks after US inflation data revealed US CPI remains red hot and above market expectations, prompting the fed to likely introduce a 100 basis point or 1% rate hike on Thursday at the conclusion of the FOMC meeting.
- Energy, materials and utilities stocks led the market rally yesterday, with New Hope Corporation (ASX:NHC) soaring almost 9% after releasing stellar FY22 results including NPAT soaring over 1100%.
- Onto the commodities front, the price of commodities are down across the board today Trevor with, Crude oil trading 1.5% lower around 84 US dollars a barrel, Brent is trading, around 90 US dollars a barrel so nearly 2% lower, Iron ore is trading, 1.5% lower at 100 US dollars a tonne and Gold continues its slump, trading down 0.75% at 1663 US dollars an ounce.
- Ahead of the local trading session today, the ASX futures are expecting the market to open sharply lower around 1.45%, again following the global sell-off overnight.
- Stocks going ex-dividend today include Capitol Health (ASX:CAJ), Countplus (ASX:CUP), ADBRI (ASX:ABC), Cleanaway Waste Management (ASX:CWT) and Cochlear (ASX:COH). If you have been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
- There is no local economic data news out today however investors will still be awaiting the release of the Fed’s interest rate decision which is out at 4am eastern time tomorrow morning.
Trading Ideas:
- Trading Central has identified a bullish signal on Webjet (ASX:WEB) following the formation of a pattern over a 16-day period which is the same amount of time the stock price may rise from the close of $5.43 to the range of $6.15 to $6.35, according to standard principles of technical analysis.
- Bell Potter has downgraded its price target on Imugene (ASX:IMU) to $0.36 per share from $0.45 and has a speculative buy rating on this stock. The price target downgrade follows Bell Potter identifying the need for the company to raise capital to support its clinical trial programs through the issuing of 400m new shares at $0.20 per share. Bell Potter also notes the company is executing quite a few trials over the next year where investors will be keeping a close eye on the results to determine just how valuable the company’s biotechnology operations are.
The local market recovered from the recent inflation-related sell-off today, sharply rising 1.29% to close the session in positive territory, driven by a surge in energy, materials and utilities stocks today amid the rising price of commodities. Crude was up 0.34% today and natural gas rose 1.6%.
The story of the day was IDP Education (ASX:IEL) entering a binding agreement to acquire 100% of student placement agency Intake Education for up to $83m. Intake is a leading student placement agency with global operations and brings to IDP Education three decades of industry leadership in the UK-bound international education sector. Following the announcement, shares in IDP Education rose 2.66%.
Andrew Forrest’s Fortescue Metals Group (ASX:FMG) also revealed plans to execute a US$6.2b capital investment by 2030 to eliminate fossil fuel risk and reduce operating costs by US$818m per year, in another step for the company to achieve real zero terrestrial emissions across its iron ore operations by 2030.
New Hope Corporation (ASX:NHC) added almost 9% after releasing FY22 results today including revenue up 143.5% and NPAT soaring 1,138.8% to $983m. The company also announced a fully franked 31 cents per share final dividend and a 25 cents per share special dividend. Brickworks (ASX:BKW) also added 5.75% today and Mineral Resources (ASX:MIN) jumped 5.26%.
On the losing side, Abacus Property Group (ASX:ABP) took the biggest hit today, closing the session down 2.21%, while Telix Pharmaceuticals (ASX:TLX) and AMP (ASX:AMP) also lost over 2% each.
The top traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), New Hope Corporation (ASX:NHC), and the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR).
In economic data, investors will be awaiting the release of the US Fed’s interest rate decision for September which is out at 4am AEST on Thursday morning.
The three US benchmarks closed higher to start the new trading week ahead of the Federal Reserve’s two-day policy meeting set to kick off on Tuesday. The Dow Jones jumped nearly 200 points and the S&P500 and Nasdaq both closed around 0.7% higher. Yields also pushed higher. The 10-year Treasury yield hit as high as 3.51%, its highest level in 11 years. Across the sea in Europe, markets closed mixed, as investors await the Fed’s decision.
What to watch today:
- The SPI futures are suggesting that the ASX200 will open 0.82% higher after Wall Street’s positive session.
- In economic news, today the latest minutes from the RBA’s most recent Board meeting will be published.
- Core Lithium (ASX:CXO) is expected to release its annual results this week, so keep an eye on this lithium stock.
- In commodities:
- Oil prices lifted slightly higher as worries of tight supply outweighed fears that global demand could slow. The crude oil price currently trades around US$86 a barrel.
- The gold price traded flat as the US dollar and Treasury yields rose.
- The spot iron ore price traded nearly 3% lower to US$101 a tonne. Keep watch of iron ore stocks like Fortescue Metals (ASX:FMG) and BHP Group (ASX:BHP).
- If you hold Coronado Global Resources (ASX:CRN) or Shaver Shop Group (ASX:SSG) you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on neuroscience technology company, Cogstate (ASX:CGS), and have reduced its price target from $2 to $1.95. Its technologies provide rapid, reliable, and highly sensitive computerised cognitive tests to replace costly and error-prone paper assessments. At its current share price of $1.46, Bell Potter’s price target of $1.95 implies about 34% share price growth in a year.
- Trading Central has a bearish signal on AGL Energy (ASX:AGL) indicating that the stock price may fall from its close of $6.97 to the range of $6.00 - $6.20, in the next 8 days according to standard principals of technical analysis.
The local market see-sawed throughout the first trading session of the week before closing the day down 0.28%, led by a sell-off in utilities and tech stocks, while real estate stocks recovered some losses from Friday’s sharp sell-off.
Looking at the best performing stocks today, Lake Resources (ASX:LKE) recovered some of last week’s losses to close 12.37% higher today after the lithium miner released another update on its Kachi Lithium Project to alleviate investor concerns over the dispute with its project partner Lilac Solutions, with Lake Resources today saying that ongoing work is being done by Lilac and all parties are confident that on-site operations will be successful. Other stocks that investors bought into today included Pilbara Minerals (ASX:PLS) and a number of other lithium producers today as investors pile into the EV-battery metal sector today. Oz Minerals (ASX:OZL) and Sandfire Resources (ASX:SFR) also each added more than 3% today. Investors sharply sold out of Sayona Mining (ASX:SYA) shares today as today is the first day the company trades as part of the ASX200, while Magellan Financial Group (ASX:MFG) fell 5.75% today and Breville Group (ASX:BRG) lost 5.2%. Investors also fled buy now, pay later stocks today, which saw Block (ASX:SQ2) shares tumble 4.46%, as investors speculate an aggressive rate hike from the Fed’s in the US will be announced on Wednesday.
The top traded stocks by Bell Direct clients today were Pilbara Minerals (ASX:PLS), Lynas Rare Earths (ASX:LYC), BHP Group (ASX:BHP), Fortescue Metals Group (ASX:FMG) and Allkem (ASX:AKE).
Taking a look at economic data, tomorrow is the big release day of the RBA’s September meeting minutes which investors have been anticipating to determine whether the RBA really is dovish about the way forward for lower interest rate hikes or whether they will continue to aggressively act to curb inflation.
The Australian market closed sharply lower on Friday, down 1.52% as inflation panic set in causing investor confidence to tumble. Friday’s session was weighed down by a sharp sell-off in energy and materials stocks, but every sector closed the day in negative territory.
The winning stocks on Friday were the Star Entertainment Group (ASX:SGR), which jumped 5.07% higher on ASX, Computershare (ASX:CPU) added 4.42% and Tabcorp (ASX:TAH) rallied just over 4.2% on Friday. On the losing side, Lake Resources (ASX:LKE) recovered almost 1% on Friday but the lithium miner fell 28% for the week as investors sold out after the company revealed it has a dispute over deadline dates at its Kachi Lithium Project with its partner Lilac Solutions. Capricorn Metals (ASX:CMM) was the worst performing stock on Friday, shedding 11.7% followed by Atlas Arteria (ASX:ALX), which lost 9.7% and Sayona Mining (ASX:SYA), which ended the day down 9.4%.
The most traded stocks by Bell Direct clients on Friday were the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), Silver Lake Resources (ASX:SLR), and Desert Metals (ASX:DM1).
Over in the US, the inflation related sell-off extended into Friday to close out America’s worst trading week since June. The Dow Jones fell 0.45%, the S&P500 shed 0.72% and the Nasdaq had the biggest fall of 0.9%. Shares in FedEx plunged 21.4% in the company’s worst session ever after the shipments company withdrew its full-year guidance and said it will implement cost-cutting initiatives to navigate softer global shipment volumes as the global market has ‘significantly worsened’. Following the news, shares in rivals UPS and XPO Logistics each dropped 4.5% and 4.7% respectively. The global market sell-off extended into the UK and Europe with the FTSE100 closing Friday’s session 0.62% lower while the CAC and DAX each lost 1.3% and 1.6% respectively.
What to watch today:
- Locally today, ASX futures are expecting the market to open marginally lower, around 0.03% at 6737 points which is a sharp rise from Friday’s sell-off.
- Stocks going ex-dividend today include Enero Group (ASX:EGG), Service Stream (ASX:SSM), IPD Group (ASX:IPD), and QUBE Holdings (ASX:QUB), which could be a good opportunity to buy in if you have been thinking about these stocks as stocks going ex-dividend generally trade lower on the ex-dividend date.
- Taking a look at commodities, crude oil is flat trading around US$85 a barrel, Brent is up 0.99% at US$91.7 a barrel, natural gas is down 6.15% but gold is up 0.7% at US$1675.06 per ounce, and iron ore is down 2.9% to US$101.50 per tonne.
- On the economic data front, investors will be nervously awaiting the release of the RBA meeting minutes for September which are out on Tuesday to determine exactly how dovish the RBA is toward raising interest rates in the future, or whether there are hidden signals that future interest rate rises could be as aggressive as the previous few.
Trading Ideas:
- Trading Central has identified a bullish signal on the Star Entertainment Group (ASX:SGR) following a short-term pattern forming over a period of 15-days which is the same time the upgraded price range between $3.04 to $3.08 may be achieved from the close of $2.90, according to standard principles of technical analysis.
- Bell Potter has initiated coverage on OreCorp (ASX:ORR) with a Speculative Buy rating on this stock and a price target of $0.84 per share following the major de-risking event of the completion of the Definitive Feasibility Study on the company’s prime asset, the Nyanzaga Gold Project, and ahead of the key catalyst of project financing. The NGP is emerging as an attractive, significant scale, new gold project with strong financial performance metrics in a region that is experiencing a resurgence in investment by the world’s largest mining companies.
The Aussie share market declined 0.74% this week (Mon-Thu), as investors fear more aggressive rate hikes. US inflation data for August came in at 8.3%, above market expectations.
In this week's wrap, Grady covers:
- (0:08) The latest US inflation reading
- (0:54) Two FMCG stocks Bell Potter has its eye on
- (3:18) Why investors are embracing cash ETFs
- (4:00) Material stocks advancing despite market turbulence
- (5:38) The most traded stocks & ETFs by Bell Direct clients
- (6:08) Two economic news items to watch out for
Our local market closed with a 0.2% gain yesterday, with energy and financials advancing the most.
On the prospect of the first strike by American railroad workers in 30 years, ASX coal producer’s rallied, lifting the energy sector higher. Coal stocks were the best performers, including Coronado Global Resources (ASX:CRN), New Hope Corporation (ASX:NHC) and Whitehaven Coal (ASX:WHC). Meanwhile, Lake Resources (ASX:LKE) dropped more than 12% yesterday.
The most traded stocks by Bell Direct clients were Whitehaven Coal (ASX:WHC), Pilbara Minerals (ASX:PLS) and the BetaShares US Dollar ETF (ASX:USD).
Wall Street extended losses overnight. The Dow Jones closed 0.6% lower and the S&P500 dropped 1.1%, with nine of the eleven industry sectors in the red. The Nasdaq was the worst performer as tech shares declined, down 1.4%.
What to watch today:
- The local market is expected to slide this morning. The SPI futures are suggesting a fall of 0.73%.
- In economic data, yesterday the unemployment rate for August was released. It increased to 3.5%.
- In commodities:
- Oil has pulled back, trading more than 4% lower, after the US Department of Energy said that its plan of refilling the country’s strategic oil reserves, does not include a trigger price. This announcement has backtracked previous reports that the US would restock the emergency reserves, should prices fall below US$80, removing the potential price floor for oil.
- Gold has dropped to levels last seen in April 2020, due to an increasingly strong US dollar.
- Iron ore has pulled back, trading down 2.5%.
Trading Ideas:
- Bell Potter maintain a Buy rating on Select Harvests (ASX:SHV) with a price target of $6.90. At the stock’s current share price of $5.65, this implies 24.1% share price growth in a year.
- Trading Central has identified a bullish signal in Coronado Global Resources (ASX:CRN), indicating that the stock price may rise from the close of $1.85, to the range of $2.17 to $2.27, over 31 days, according to the standard principles of technical analysis.
US inflation came in hotter than expected this week, with consumer prices rising 8.3% year-over-year in August. However, what was even more concerning than the headline figure was the core inflation measure excluding volatile food and energy prices, which accelerated from 5.9% in July to 6.3% in August. Now, the interest rate futures responded to the inflation readings by pricing out any probability of a 0.5% hike at next week’s Fed meeting, and pricing in a 32% likelihood of a full percentage point hike, up from 0% probability one week prior.
US equities overnight closed higher. The Dow Jones slightly higher, up just 0.1%, the S&P500 up 0.3% and the Nasdaq up 0.7%.
What to watch today:
- Locally, the Australian market is set to open flat this morning, with the SPI futures suggesting a rise of just 0.09%. Investors are hoping for a more positive outlook today, after yesterday’s heavy sell-off.
- In commodities,
- Oil is trading just under 2% higher, as investors continue to assess the outlook for global demand. Oil stocks to watch include Santos (ASX:STO) and Woodside Energy (ASX:WDS).
- Gold is in the red, weighed down by a sharp US dollar, as the higher-than-expected US inflation figures fuelled expectations that the Fed will continue to raise rates. So gold miners to keep your eye on are Evolution Mining (ASX:EVN) and Regis Resources (ASX:REG).
- And iron ore is trading at its highest level in almost three weeks, amid prospects of increased Chinese demand. China, a top steel producer and iron ore consumer, has announced more stimulus measures to support its COVID-hit economy, which includes new infrastructure projects. So keep watch of miners that may benefit from rising iron ore prices, such as Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG), BHP (ASX:BHP), and Champion Iron (ASX:CIA).
- Stocks set to go ex-dividend today, which often sees share prices fall include Best & Lee (ASX:BST), Earlypay (ASX:EPY), IGO (ASX:IGO), Regis Healthcare (ASX:REG), Ramelius Resources (ASX:RMS) and South32 (ASX:S32).
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on Avita Medical (ASX:AVH) with a valuation of $3.00. At its current share price of $1.95, this implies 53.8% share price growth in a year.
- Trading Central have identified a bearish signal in Bendigo and Adelaide Bank (ASX:BEN), indicating that the stock price may fall from the close of $8.43 to the range of $7.90 to $8.00, over 5 days, according to the standard principles of technical analysis.
There was no good, just bad and ugly in today’s session on the ASX as investors responded to the Wall St sell-off sparked by US inflation data hitting 8.3% for August.
The ASX ended the midweek session down 181.10 points or 2.58%, weighed down by a heavy sell-off in real estate stocks, although no sector was safe from the market sell-off today with all 11 sectors ending the session in negative territory, with real estate stocks again taking the biggest hit. More than $58 billion was wiped off the ASX in the opening hour of trade today, as the local market tumbled more than 2.6%. Japanese financial firm Nomura has raised its expectations of the Fed to hand down a full 1% interest rate hike at the FOMC meeting next week, while also expecting the RBA to increase Australia’s cash rate hike by 0.5% in October instead of the previously forecasted 0.25%. Westpac also says Australia is facing a similar problem to the US with consumption remaining strong, meaning demand is continuing to drive inflation.
Finding a winning stock today was like finding a diamond in the rough, but one standout was Clover Corporation (ASX:CLV), which surged more than 11% during the session after releasing full year results in line with the top end of guidance. The strong results were boosted by the second half of the year with international borders opening and key infant milk manufacturers lifting orders. Mesoblast (ASX:MSB) ended the session as the leading stock, gaining 2.2% despite no price sensitive news released by the regenerative medicine company today.
On the losing front, Lake Resources (ASX:LKE) continued its run in the firing line of investors with the stock plunging more than 15% today after the company revealed a dispute with Lilac Solutions regarding the Kachi Pilot Plant as to the date by which certain milestones must have been achieved. Under the agreement, Lilac will earn up to a 25% stake in the Kachi Project based on meeting certain milestones, which Lake considered must be achieved by September 30, while Lilac believes it has until 30 November to do so. Investors also sharply sold-off Megaport (ASX:MP1) and Clinuvel Pharmaceuticals (ASX:CUV) shares today.
The top traded stocks by Bell Direct clients today were Lake Resources (ASX:LKE), Star Entertainment Group (ASX:SGR) and Cochlear (ASX:COH).
On the economic calendar for tomorrow, Australia’s unemployment rate for August is released, which will give an insight into how tight the country’s labour market was last month.
US markets snapped the recent rally overnight following the release of key inflation data for August showing the world’s largest economy’s inflation rate hit 8.3% for the month which is a decline from July’s 8.5% but above the market expectations of 8.1%. Investors sharply sold out of stocks broadly on Wall St over concerns the Fed will take even more aggressive action to cool inflation by rising interest rates further. The Dow Jones fell 3.3%, the Nasdaq plunged 4.35% and the S&P500 fell 3.52%.
The sell-off extended over to London where the FTSE 100’s green run came to an end with the index falling 1.17% while Germany’s DAX closed the day down 1.6%, and the French CAC lost 1.4%.
Ukraine’s recent advances and counterattacks in the nation’s recaptured area to 6,000 square kilometres which has impressed the White House and other western allies. From a markets perspective, global markets just want to see de-escalation of tensions to help stabilise inflation and cool the global energy crisis.
What to watch today:
- Locally, the global energy crisis has driven demand for Australian-based energy stocks with the sector up 37.36% YTD as countries look for new supply deals with Australian providers which we have already seen through Woodside Energy (ASX:WDS) signing a supply agreement for the supply of LNG with Europe. This year, the energy sector is one of just two sectors that have posted gains in the current market environment.
- In commodities, crude oil is trading almost half a percent lower at US$87 a barrel, natural gas is up almost 1%, gold is trading more than 1.2% lower at US$1,703 an ounce, and iron ore is flat around US$104 a tonne.
- Ahead of the local trading day, ASX futures is expecting the market’s green streak to come to an end today, with the futures expecting a fall of 1.75% to start the day on the back of that sharp sell-off in the US overnight.
- On the economic data front for today, UK inflation data for August is released this afternoon with the market expecting an increase to 10.2% from 10.1% in July.
Trading Ideas:
- Bell Potter maintains a buy rating on The a2 Milk Company (ASX:A2M) and has increased its share price target from $6.35 to $6.60 following recent market updates including its New Zealand baby formula manufacturer Synlait Milk having its licence to produce baby formula for the Chinese market extended until February 2023.
- Trading Central has identified a bullish signal on Brambles (ASX:BXB) following a pattern forming over a period of 15-days which is roughly the period of time in which the price target between the range of $13.10-$13.40 may be achieved from the close of $12.08, according to standard principles of technical analysis.
The Australian market’s rally extended into a fourth straight session today with the key index ending the day up 0.65%, driven by a surge in real estate stocks today.
ANZ consumer confidence data for last week out today shows Aussie confidence fell 0.5% following the RBA’s latest interest rate hike, however Westpac Consumer Confidence data for September also out today showed an increase of 3.9%, rebounding from a 3% fall in August and rising for the first time since November 2021.
NAB business confidence data was also released today, which showed businesses were also confident in August as the index rose 2 points to 10 in August and conditions remain strong across the states and most industries indicating that demand remains strong. NAB expects that inflation and rising interest rates will eventually begin to weigh on household budgets which will in-turn lead to decreasing demand.
The best performing stocks today were Chalice Mining (ASX:CHN) which added almost 10%, NOVONIX (ASX:NVX) gained 7.5% and BrainChip (ASX:BRN) jumped 5.8%.
The bigger stories came out of the losing front today:
- Link Administration (ASX:LNK) nosedived more than 20% as investors fled the stock on concerns that the company’s proposed $2.5b buyout by Dye & Durham would be derailed by the UK’s Financial Conduct Authority’s regulatory approval process.
- A consortium of investors led by KKR pulled out of takeover talks with Ramsay Health Care (ASX:RHC) for a buyout worth nearly $30b which led to Ramsay Health Care shares tumbling 10%.
- Woolworths’ (ASX:WOW) acquisition of 80.2% of issued shares in MyDeal was approved by the NSW Supreme Court today. It is expected that an office copy of the Court orders will be lodged with ASIC tomorrow, at which time the Scheme will become legally effective.
- Star Entertainment Group (ASX:SGR) has been found unfit to hold a casino licence in NSW today following a lengthy inquiry into the hotel and casino giant by the NSW Independent Casino Commission. Shares in SGR rallied more than 3% today in a sign the market expected this outcome from the inquiry and in anticipation of who will come in to recover and restructure the casino giant in order to comply with regulations.
The top traded stocks by Bell Direct clients today were Mineral Resources (ASX:MIN), BHP Group (ASX:BHP) and Macquarie Group (ASX:MQG).
In economic data, investors are eagerly awaiting the release of US inflation data for August which is out later tonight, to gain an insight into whether the cost of living in the world’s largest economy continued to decline for the month.
The US market closed higher for the fourth straight session off the back of growing confidence that inflation has peaked. Also boosting sentiment was a weaker US dollar. This saw the Dow rise more than 200 points, and both the S&P500 and Nasdaq lift more than 1%. Investors are now awaiting the release of the August consumer price index report on Tuesday morning US time.
In Europe, markets also closed higher, with the German DAX up the most, rising 2.4%.
What to watch today:
- The SPI futures are suggesting that the ASX200 will open 0.6% higher.
- Economic news wise, we’ll get an update on just how confident both consumers and businesses are in the current market. At 10:30am AEST, Westpac’s Consumer Confidence reading will be announced, and at 11:30am, NAB’s Business Confidence for August will be released.
- AGL Energy (ASX:AGL) will be on watch today, after the gas and electricity provider revealed after market close yesterday that the Loy Yang A Unit 2 will be out of action for longer than expected, after a defect was identified. Management however expects its strong performance during August and September to help offset the earnings impact.
- In commodities:
- Oil prices rose off the back of supply uncertainty.
- The gold price also gained as the US dollar slipped.
- And the spot iron ore price traded nearly 3% higher to US$105 a tonne.
- Stocks going ex-dividend today include Grange Resources (ASX:GRR), TPG Telecom (ASX:TPG), IVE Group (ASX:IGL), Inghams (ASX:ING) and News Corp (ASX:NWS).
- If you hold Domain Holdings (ASX:DHG), GUD Holdings (ASX:GUD) or APA Group (ASX:APA), you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on lithium miner, Allkem (ASX:AKE) and have increased its price target from $18.76 to $20.04. Bell Potter expect AKE’s cash generation to lift substantially into 2023, given the ongoing strength in lithium demand, commodity prices and production growth. At its current share price of $15.53, Bell Potter’s price target of $20.04 implies about 29% share price growth in a year.
- Trading Central has a bearish signal on property group Aspen Group (ASX:APZ) indicating that the stock price may fall from its close of $1.66 to the range of $1.45 - $1.49, in the next 21 days according to standard principals of technical analysis.
The Australian market extended last week’s rally into this week with the key index closing the session 1.02% higher, boosted by a surge in materials and technology stocks.
The best performing stock today was Nickel Industries (ASX:NIC) soared 6.7% after announcing an upgrade to its Hengjaya Mine Resource, increasing the resource from 2.4m tonnes to 3.7m tonnes of contained nickel metal. Gold Road Resources (ASX:GOR) also lifted just over 5% today. Other stocks that investors bought into today included Mineral Resources (ASX:MIN), with shares in the mining services giant soaring to a fresh record high of $74.20 today during the session. The a2 Milk Company (ASX:A2M) also lifted today following its New Zealand-based baby formula producer for the Chinese market, Synlait Milk (ASX:SM1), being granted renewal of its State Administration for Market Regulation licence to continue manufacturing the baby formula for China until 21 February 2023.
Investors sharply sold out of Liontown Resources (ASX:LTR) today despite the company announcing it has executed a letter of award with Zenith Energy (ASX:ZEN), one of Australia’s leading independent power producers, to supply electricity to its Kathleen Valley Lithium project in Western Australia for a 15-year period. Other losing stocks today included Sims (ASX:SIM) and Lake Resources (ASX:LKE).
The top traded stocks by Bell Direct clients today are Pilbara Minerals (ASX:PLS), Fortescue Metals Group (ASX:FMG) and Lake Resources (ASX:LKE).
On the economic calendar for tomorrow, investors will gain an insight into just how confident both consumers and businesses are with current market and economic conditions, with Westpac Consumer Confidence data for September out in the morning followed an hour later by the release of NAB’s Business Confidence data for August. US Core inflation data for August is also out later tomorrow night.
The Australian market closed 0.66% higher on Friday as investor confidence extended into the final trading session of the week, after RBA Governor Philip Lowe gave dovish signs of the way forward in terms of interest rate hikes.
The winning stock on Friday was Mineral Resources (ASX:MIN) after the leading mining services company said it regularly considers ‘strategic options’ for its lithium segment in an indication the company may be looking to spin-off its lithium division. De Grey Mining (ASX:DEG) and Sandfire Resources (ASX:SFR) also led the gains on Friday, each adding almost 12% and 8% respectively.
On the losing front, investors sharply sold-off Life360 (ASX:360) despite no price sensitive news released by the location tracking company. Imugene (ASX:IMU) also fell more than 4.2% on Friday possibly after some investors took profits from its prior session surge after the company announced it has dosed the first patient in its Phase 2 trial for its leading drug candidate HER-Vaxx.
The most traded stocks by Bell Direct clients last week were Paladin Energy (ASX:PDN), Myer Holdings (ASX:MYR) and Pilbara Minerals (ASX:PLS).
Over in the US, stocks rallied to end the week with strong gains. The Dow Jones added 1.2%, the S&P500 jumped 1.5% and the Nasdaq surged 2.11% on Friday. The tech-heavy Nasdaq was the winning index for the week, adding more than 4.1%. Investors bought back into shares following the end of the recent reporting season that showed companies are handling inflation and slowing growth well. Tesla shares rallied 3.6% on Friday after the EV giant said it is looking into constructing a lithium hydroxide refining facility that can help support its EV battery production. The rally carried over to Europe with the FTSE gaining 1.23%, the DAX adding 1.43% and the CAC lifting 1.41%.
What to watch today:
- The futures are expecting the market to open 1.15% higher to extend the gains from last week into the new trading week.
- On the commodities front:
- Oil has rebounded from 8-month lows that ended last week to trade 3.21% higher at around US$86.22 a barrel.
- Gold is up half a percent to US$1716 an ounce.
- Iron ore is up just under 3%.
- Natural gas is trading up almost 1.5%.
- Economic news wise, investors will gain an insight into consumer and business confidence, with Westpac Consumer Confidence data for September out tomorrow as well as NAB Business Confidence data for August being released tomorrow. Overseas, US inflation rate data for August is also out later on Tuesday night which will give an insight into just how expensive it was to live in the US in August.
Trading Ideas:
- Trading Central has identified a bullish signal on data software company Nuix (ASX:NXL) after identifying a pattern forming over an 87-day period, which is the same amount of time the share price is expected to rise from the close of $0.86 to the range of $1.00-$1.06 according to standard principles of technical analysis.
- Bell Potter has upgraded its price target on Aroa Biosurgery (ASX:ARX) from $1.35 to $1.40 and maintains its Speculative Buy rating on the stock, driven by upgrades in TELA Bio Revenues which is ARX’s commercial partner.
The Aussie share market gained 0.29% this week (Mon-Thu), boosted by the technology sector. The RBA also raised the cash rate to 2.35%, raising consumer concerns about the rising cost of living.
In this week's wrap, Grady covers:
- (0:29) The increase on Australian home loans
- (0:51) Whether the building boom is over
- (1:15) When Australians will feel the full brunt of the recent rate hike
- (3:52) Why energy stocks were sharply sold off
- (4:45) The most traded stocks & ETFs by Bell Direct clients
- (5:09) Four economic news items to watch out for
Well US investors took the Federal Reserve’s latest comments on taming inflation positively, as equities moved higher overnight in New York. Stocks initially fell during a Q&A session from the Fed Chairman Jerome Powell at the Cato Institute. He signalled that there wouldn’t be a pause in rate hikes or a pivot to cutting interest rates anytime soon. US equities however ended the session with gains. The Dow Jones closed up 0.6%, the S&P500 up 0.7% and the Nasdaq up 0.6%.
European markets closed higher, after the European Central Bank announced a 75-basis point interest rate rise. The STOXX 600 closed 0.5% higher.
What to watch today:
- The Australian market is set to open flat this morning. The SPI futures are up 5 points.
- In commodities,
- Oil is trading 2% higher. The price is rebounding after tumbling almost 6%, as investors weighed on supply concerns. Also President Vladimir Putin said Russia was to immediately stop oil supply to countries that support the G7’s initiative to cap prices on oil exports or the EU’s plan to place a ceiling on Russia natural gas sales. Although the oil price is currently trading in higher, it still remains close to the 8-month low, which was reached when monetary tightening and COVID lockdowns weighed on demand. Today, keep watch of Woodside Energy (ASX:WDS), Beach Energy (ASX:BPT), Santos (ASX:STO) and other energy producers.
- The gold price is lower, after caution dominated sentiment ahead of the Jerome Powell’s speech and the ECB’s rate hike announcement. Watch gold miners such as St Barbara (ASX:SBM) and Newcrest Mining (ASX:NCM).
- Iron ore has also dropped, approaching the nine-month low it reached earlier in the month.
- Stocks going ex-dividend today, which may see share prices fall as investors take profits, include Nine Entertainment (ASX:NEC) and WiseTech Global (ASX:WTC).
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on De Grey Mining (ASX:DEG). Bell Potter have increased their price target from $1.80 to $1.97. At its current share price of $0.97, this implies 103% share price growth in a year.
- Trading Central have identified a bearish signal in Metcash (ASX:MTS), indicating that the stock price may fall from the close of $4.11 to the range of $3.79 to $3.85 over 10 days, according to the standard principles of technical analysis.
The Australian market rebounded sharply from yesterday’s sell-off to close Thursday’s session 1.77% higher, boosted by investors piling into the tech and materials sectors today.
Investor confidence was boosted by a rebound in commodity prices and RBA Governor Philip Lowe’s speech, where the RBA leader gave clarity and certainty around the slower way forward in terms of rate hikes. Mr Lowe said there are at least two more rate hikes to come in order to tame the country’s inflation to the target range between 2-3%, and that the RBA thinks the neutral cash rate is at least 2.5%. Australia’s trade balance for July released today showed the country’s trade surplus more than halved in July to $8.73 billion, which fell well short of market expectations for a $14.5 billion surplus. Exports fell 9.9% in the month due to a sharp fall in sales of metal ores and minerals.
Today’s winning stock was Tyro Payments (ASX:TYR), surging more than 28% after the fintech company rejected a takeover bid worth $658 million from a Potentia Capital-led consortium. Tyro’s board considered the indicative proposal and unanimously determined the offer significantly undervalues Tyro and as such advised it is not in the best interest of shareholders to proceed with this offer in its current form. And it was a tech sector surge today with technology stocks posting the biggest gains of the session. Life360 (ASX:360) soared over 15%, while Megaport (ASX:MP1) added more than 12%.
On the losing front, Alumina (ASX:ALU) took the biggest hit today, closing the session down over 2.4%, while Medibank Private (ASX:MPL) and Chorus (ASX:CNU) each fell over 1%.
The top traded stocks by Bell Direct clients today were the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), CSL Limited (ASX:CSL) and Lake Resources (ASX:LKE).
In economic data, initial jobless claims in the US for the last week will be released overnight with the market expecting a jump in claims to 240,000. Investors will also keep a close eye on any further hawkish signals on the monetary policy front when Fed Chair Jerome Powell speaks at Cato Institute Conference overnight.
US markets snapped a two-session losing streak, to close higher across the three key indices, led by the Nasdaq rallying more than 2% on Wednesday as oil prices and rate concerns eased, which cooled investor fears over continued high inflation. Stocks rallied after Federal Reserve Vice Chair Lael Brainard reaffirmed the Fed will do what it takes to control the country’s inflation, while also noting the risks of going too far. US trade balance data for July came in overnight, with imports continuing to outweigh exports, as the trade balance in the world’ largest economy regained some ground to a deficit of US$70.7 billion from $80.9 billion in the month prior.
Over in Europe, Russian President Vladimir Putin caused a sell-off in stocks after threatening to cut back grain exports from Ukraine and said Moscow could extend its rations of natural gas exports and cut off oil flow if the west goes ahead with a planned price cap on Russian crude. Putin’s comments on grain sent global wheat prices up 4%. Stocks were also sold off as investor concerns over a recessionary outlook continue to grow. The FTSE100 fell almost 1%, the DAX added just 0.3% and the CAC closed just 0.02% higher.
What to watch today:
- On local shores, the ASX futures are anticipating the market to open just under half a percent higher today, to recover from yesterday’s sharp sell-off.
- In commodities, crude oil is trading 6% lower overnight, natural gas is down 3.5%, gold is 1.3% lower and iron ore is trading down 1.5%.
- In economic data, investors will be keeping an eye on RBA Governor Philip Lowe’s speech to gain an insight into just how aggressively the RBA will continue to raise interest rates in the future. Australia’s trade balance data is also out today, with the market expecting a trade surplus of $14.5 billion, down June’s surplus above $17.6 billion. Investors will be hoping the data boosts mining stocks today, following a sharp sell-off yesterday, after China’s trade balance showed demand fell nationally and internationally for iron ore, copper and gold.
Trading Ideas:
- Trading Central has identified a bullish signal on software company Nuix (ASX:NXL), amid a pattern forming over a 17-day period. The bullish signal indicates that over this same period the stock price could climb from the close of $0.69/share to between $0.81-$0.85 / share according to standard principles of technical analysis.
- Bell Potter has initiated coverage of medicinal cannabis company Cronos Australia (ASX:CAU) with a buy rating and a price target of $0.60 per share with the expectation that momentum observed for Cronos in FY22 will continue into FY23 and translate into strong revenue and earnings growth.
Investor sentiment was dampened today in the wake of the RBA’s 50-basis point interest rate hike, GDP data showing the Australian economy grew 0.9% in the June quarter and the price of oil tumbling 2%, which caused a sell-off in energy stocks. The market closed the midweek session down 1.42%, dragging the index down more than 10.6% over the last 52-weeks.
The story of the session was Australia’s economy or GDP growing 0.9% in the June quarter and 3.6% for the year, driven by the boom in resource exports and high household consumption. The high consumer household spending, which jumped 2.2% in the quarter, indicates the full impact of RBA rate hikes are yet to fully be felt by consumers, with the biggest increases in spending done at cafes, restaurants and on transport services. The overall GDP data came in relatively in-line with market expectations.
Today’s winning stock was ResMed (ASX:RMD), which jumped 4.23% after Morgans placed an Add rating on the stock with a price target of $37.08 per share, based on the sleep treatment company’s positive long term growth outlook. Virgin Money (ASX:VUK) also rallied 3.3% today, while Fisher & Paykel Healthcare (ASX:FPH) added just over 3%.
Energy stocks faced a sharp sell-off today as the price of oil and natural gas prices are down around 2% each in the aftermath of Russia announcing Nord Stream 1 would be offline indefinitely, OPEC placing a price cap on Russian oil and China’s COVID zero goal hurting demand. Viva Energy Group (ASX:VEW) fell more than 6.5% today, while New Hope Corporation (ASX:NHC) and Beach Energy (ASX:BPT) lost 4.9% and 4.5% respectively. The session’s worst performing stock was Chalice Mining (ASX:CHN), which fell more than 13% despite no price sensitive news released by the company today. Qantas (ASX:QAN) shares also took a hit today after the ACCC found the cheapest domestic airfares were 56% more expensive in August than the four months prior, travellers faced record delays and the number of flights cancelled surged to three times the long-term average in July.
The top traded stocks by Bell Direct clients today were Whitehaven Coal (ASX:WHC), the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), and Fortescue Metals Group (ASX:FMG).
On the economic calendar US trade balance data is released tonight while local investors will be keen to hear RBA Governor Philip Lowe’s speech tomorrow to look for any signs on how aggressively the RBA will continue to raise interest rates moving forward, following the rate hike yesterday
US equities tumbled in what was a volatile trading session, as trading resumed overnight following the Labor Day national holiday. Wall Street continued its broad sell-off. The Dow closed over 170 points lower, or 0.6%. The S&P500 fell 0.4% and the Nasdaq closed 0.7% lower, notching its seventh day of losses, its longest since 2016.
The Institute of Supply Management PMI came in stronger than expected. However, investor sentiment has been dampened lately, amid hawkish comments from the Fed, who show no signs of easing up aggressive interest rate hikes. Also, the court battle between Tesla CEO Elon Musk and social media company Twitter is scheduled for today. In London, shares responded favourably to the news of the new Prime Minister Liz Truss.
Following the RBA’s cash rate hike yesterday, the national currency has struggled to gain momentum, with one Aussie dollar buying just 68 US cents.
What to watch today:
- The SPI futures are suggesting the Australian market will open 0.54% lower this morning.
- In economic data, today the GDP Growth Rate for Q2 will be released at 11:30am AEST. Year-over-year, the growth rate is expected to rise from 3.3% to 3.5%.
- On the commodities front:
- Crude oil has slipped more than 2% overnight, amid weaker demand fears and the prospect of rising interest rates, despite OPEC agreeing to cut crude supply by 100,000 barrels per day in October in a bid to prop up oil prices.
- Iron Ore is trading more than 3% higher at US$101 per tonne
- Gold is trading flat at US$1,700 per ounce.
Trading Ideas:
- Bell Potter have re-initiated coverage on Starpharma (ASX:SPL), a Melbourne-based biotech company focussed on dendrimer technology. The broker has a Speculative Buy rating on the stock with a $1.00 valuation. At its current share price of $0.58, this implies 72.9% share price growth in a year.
Trading Central have identified a bullish signal in Ecograf (ASX:EGR), indicating that the stock price may rise from the close of $0.44 to the range of $0.52 to $0.56, over 16 days, according to the standard principles of technical analysis.
The story of the day was the RBA raising the official cash rate by a further 50 basis points for September, taking the rate from 1.85% to 2.35%, which was in line with market expectations. The RBA also said it is committed to continue raising the cash rate.
The market rallied in the first hour of trade before turning lower and closing the session down 0.4%. Investors sold out of financial stocks today in anticipation that the big banks will pass on the full interest rate hike to customers.
Lithium stocks performed well today after a number of broker upgrades including Macquarie reiterating its ‘outperform’ rating on Allkem (ASX:AKE), while Jefferies lifted its price targets on IGO (ASX:IGO), Pilbara Minerals (ASX:PLS) and Allkem (ASX:AKE). The rally in lithium stocks was led by Core Lithium (ASX:CXO) surging almost 10%. Other winning stocks for today’s session were Lake Resources (ASX:LKE) which added 9.55%, Paladin Energy (ASX:PDN) which jumped 7.8%, and Pilbara Minerals (ASX:PLS) which closed the session up just over 7%.
And on the losing front, Breville Group (ASX:BRG) led the losses today falling almost 5%, Incitec Pivot (ASX:IPL) shed 3.66% and GrainCorp (ASX:GNC) ended the day down 2.9%.
The top traded stocks by Bell Direct clients today were Commonwealth Bank (ASX:CBA), Pilbara Minerals (ASX:PLS), and Whitehaven Coal (ASX:WHC).
In economic news, Australia’s current account balance was also released today. The nation’s current account surplus jumped to $18.3 billion in the second quarter which fell short of market expectations of $20.8 billion, but a major increase from a fall to $2.8 billion in the previous quarter. The increase in the current account for the second quarter was driven by higher commodity prices.
Tonight, the US will have its first trading session of the week with investors keeping a close eye on if the sell-off from last week will continue into the new trading week.
On the economic data front, US Global Services PMI is out tonight, in addition to ISM Non-Manufacturing business activity, PMI and Employment for the month of August with the market expecting a decline across each of these metrics from the month of July. Locally, investors will be awaiting GDP data out tomorrow for the second quarter to see if Australia’s economy continued to grow during the most recent period. The market is expecting growth of 1%, up 0.2% from the first quarter.
The US market was closed overnight for the labour day national holiday, but across the sea in Europe, markets closed lower as investors questioned economic risks in the region, reignited by concerns about the energy supply from Russia.
What to watch today:
- Despite the negative session in Europe, the SPI futures are suggesting that the ASX200 will open 0.2% higher.
- The big focus today is the RBA’s September cash rate decision, where it’s widely expected the central bank will increase rates for the fifth consecutive month. Consensus is expecting another 50 basis point hike, which would take the official cash rate from 1.85% to 2.35%. So stay tuned for the announcement at 2:30pm AEST.
- In commodities:
- Oil prices jumped, extending gains as it was confirmed that OPEC will cut production targets by about 100,000 barrels per day from October.
- The gold price traded flat at US$1,709 an ounce, as investors remained cautious of the US Federal Reserve’s rate hike path following a mixed jobs data report. The report showed that US employers hired more workers than expected in August, but moderate wage growth and a rise in the unemployment rate suggest that the labor market is starting to loosen.
- The spot iron ore price traded 1% lower to US$98 a tonne.
- There are nearly 30 stocks going ex-dividend today, including BlueScope Steel (ASX:BSL), CSL (ASX:CSL), Nickel Industries (ASX:NIC), Northern Star Resources (ASX:NST) and Origin Energy (ASX:ORG). So, we may see the share prices of these stocks decline today as investors take their profits.
- If you hold Magellan Financial Group (ASX:MFG), Bell Financial Group (ASX:BFG) or GWA Group (ASX:GWA) you will receive your dividend payment today.
Trading Ideas:
- Goldman Sachs has retained its Neutral rating on Telstra (ASX:TLS) with a price target of $4.40. Goldman Sachs has been reviewing the telco giant and hasn’t seen enough yet to upgrade its shares. At its current share price of $3.89, Goldman Sach’s price target of $4.40 implies about 13% share price growth in a year.
- Trading Central has a bearish signal on The Reject Shop (ASX:TRS) indicating that the stock price may fall from its close of $4.20 to the range of $3.67 - $ 3.77 in the next 33 days according to standard principals of technical analysis.
The Australian market rebounded from last week’s loss to start the trading week in positive territory, ending Monday’s session up 0.34%.
ASX-listed oil stocks had investors piling in today after the G-7 agreed to impose a price cap on Russian oil to reduce Russia’s revenue from the key commodity used toward funding its war in Ukraine. Russia responded by saying it will stop selling oil to countries that set price caps which fuelled the rally for energy stocks today with Beach Energy (ASX:BPT) soared more than 5% during the session, while Woodside Energy (ASX:WDS) added more than 3% and Santos (ASX:STO) rallied almost 3%.
The price of oil also jumped over 2% today extending gains as investors anticipate possible moved by OPEC+ producers to cut output and support prices at a meeting later today.
The winning stocks for today’s session were Coronado Global Resources (ASX:CRN) up 7.5%, and Whitehaven Coal (ASX:WHC) up 6.5%, as investors also piled into coal mining stocks today on the back of the price of coal soaring to a near-record high US$435 per tonne. And on the losing front, Imugene (ASX:IMU) took the biggest hit today, tumbling more than 8% despite no price sensitive news released by the biotech company today. Pointsbet Holdings (ASX:PBH) continued its decline today, shedding 6.4% and Life360 (ASX:360) was also in the firing line of investors today, with its share price closing the day down almost 5%.
The most traded stocks by Bell Direct clients today were Pilbara Minerals (ASX:PLS), Whitehaven Coal (ASX:WHC), and Commonwealth Bank (ASX:CBA).
Taking a look at economic data released today, ANZ job ads data for the month of August showed Australia’s tight labour market continues as the number of job ads posted in the month increased 2%. In Australia at present, there are more jobs than job seekers and the latest job ads data for August is further evidence that the labour shortage crisis is far from over. Data for new vehicle sales in August was also released today, showing August was the best month for new car sales since 2017, signalling demand for vehicles continues to outweigh supply. Electric vehicle sales for the month reached a record 4.4% of all new vehicles sold.
The US market will be closed overnight for the labour day national holiday. Locally, investors will be eagerly awaiting the release of the RBA’s latest interest rate decision for September, which is out tomorrow.
The Australian market closed 0.25% lower on Friday and etched out its second straight week of losses, shedding 3.88% over the last 5 trading days in the indexes worst trading week since June. The materials sector plunged more than 10% for the week as a major lockdown in China weighs on investor sentiment toward the sector, as investors fear iron ore demand from China will weaken following the lockdown. Mineral Resources (ASX:MIN) fell 6.23% on Friday, Lake Resources (ASX:LKE) 6.17%, and Sandfire Resources (ASX:SFR) dropped almost 5% to end the week.
Investor fears of demand weakening have been the determining factor for investments in materials stocks over the last week, despite some of the mining giants like BHP Group (ASX:BHP) reporting strong FY22 results last week.
Despite the turbulent session on Friday, investors piled into Life360 (ASX:360) despite no price sensitive news released by the company on the last trading day of the week. Investors also bought into GPT Group (ASX:GPT) on Friday and Clinuvel Pharmaceuticals (ASX:CUV) rose 2.3% after releasing strong FY22 results.
On the losing front, investors sold-out of NOVONIX (ASX:NVX) on Friday with the battery materials and tech company diving more than 8% as investors respond to the company’s FY22 results including the full-year loss deepening to $71 million.
The most traded stocks by Bell Direct clients last week were Boral (ASX:BLD), BHP Group (ASX:BHP) and Core Lithium (ASX:CXO).
Over in the US, markets closed lower on Friday despite a morning rally on Wall Street. The Dow Jones and S&P500 each fell 1%, while the Nasdaq lost 1.3%. Stocks rallied in the morning as the US labour department issued a strong jobs report for august, showing payrolls rose 315,000 for the month as companies continue hiring in the tight labour market, while unemployment ticked higher to 3.7% as more people look for work. The sharp sell-off in afternoon trade came as investor sentiment changed to believe the strong jobs report won’t cause the feds to act any less aggressively toward tackling inflation for the foreseeable future. Over in Europe, the key markets rallied with the FTSE adding more than 1.8%, the Dax soaring 3.3% and the CAC jumping 2.2%. The G-7 rolled out a plan to cap the price of Russian oil on global markets as part of a set of sanctions aimed at limiting Russia’s revenue from oil sales without cutting off oil supply from Russia completely which would send global oil prices soaring.
What to watch today:
- ASX futures are expected to open 0.23% lower on the back of the sell-off on Wall St on Friday.
- Taking a look at commodities, crude oil is trading just under 1% higher this morning, natural gas is down 4.07%, gold is up just under 1% while iron ore is trading down more than 1%.
- On the economic data front, final retail sales data for July is released today in addition to ANZ Job ads for August.
- Investors will also be keeping a close eye on the RBA’s interest rate decision for September which is released tomorrow as well as Australian GDP for Q2 out on Wednesday, followed by Australia’s trade balance data out on Thursday.
Trading Ideas:
- Trading Central has identified a bullish signal on CSL Limited (ASX:CSL) based on a pattern forming over a 25-day period which is roughly the amount of time the new price target will be achieved in the range between $314/share-$319/share from the close of $295.99/share, according to standard principles of technical analysis.
- Bell Potter has maintained its rating on Genetic Signatures (ASX:GSS) to a speculative hold rating but downgraded its price target to $1.20/share from $1.25/share based on challenges anticipated to be faced in FY23 including regulatory approval by the FDA for its Enteric Protozan kit expected in Q2 FY23.
The Aussie share market tumbled 3.64% this week (Mon-Thu) partly due to Wall Street’s lead. 336 companies have reported results to the market and we analyse the scorecard.
In this week's wrap, Grady covers:
- (0:32) How the energy & materials sectors performed in August
- (2:01) Why investors sold-off REIT stocks
- (2:39) The key takeaways from this reporting season
- (3:29) The a2 Milk Company (ASX:A2M) leading the gains
- (4:50) The most traded stocks & ETFs by Bell Direct clients
In New York overnight, shares turned around, regaining some of the week’s losses. The Dow and the S&P500 ending the first day of the month on a high note, with investors looking forward to the US jobs report for August. Meanwhile, the Nasdaq dropped 0.3%, posting a 5-day loosing streak, which was last seen for the Nasdaq in February. All three major averages however, are on track to finish the week lower. And the 2-year US Treasury yield topped 3.5%, which is the highest level since November 2007. This weighed on weigh sensitive growth stocks.
What to watch today:
- The SPI futures are suggesting our local market will edge higher this morning, set to rise 0.29% at the open.
- In commodities,
- Crude oil has dropped almost 4%, as US recession concerns and a weakening demand outlook have overshadowed concerns over tight supply.
- Gold is also trading lower, hovering at its lowest in 6 weeks, pressured by the Fed’s commitment in fighting inflation with aggressive policy tightening.
- Iron ore is also in the red, trading at levels not seen in nearly 10 months. Power cuts for Chinese manufacturers has lowered capacity for steel production and demand for steel inputs.
- Watch the share price movements of biotechnology company Imugene (ASX:IMU), which is set to publish its earnings results today, as well as Catalano Seafood (ASX:CSF) which is set to hold its AGM today.
Trading Ideas:
- Bell Potter maintain their Buy rating on DGL Group (ASX:DGL). The company published its FY22 results: Underlying EBITDA was up 59% year-over-year, in-line with Bell Potter’s estimates. Factoring in their expectations for FY23, the broker has lowered their price target from $3.50 to $2.15. At DGL’s current share price of $1.84, this implies 16.8% share price growth in a year.
- Trading Central have identified a bearish signal in Regis Healthcare (ASX:REG), indicating that the stock price may fall from the close of $2.03 to the range of $1.68 to $1.74, over 10 days according to the standard principles of technical analysis.
The Australian market posted a 2.02% loss on the first trading day of the new month, closing at its lowest level since late July. Every sector aside from consumer staples stocks ended the day in negative territory as the broad market sell-off continued locally in response Wall Street suffering through its worst August since 2015.
Economic data on the housing front released today also weighed on investor sentiment, with home loans issued for July falling 7% to $19.05 billion, which well exceeded the market expectation of a 3% fall. Building CaPex and private CaPex also fell for the second quarter in data out today, down 2.5% and 0.3% respectively.
On the stocks front, Endeavour Group (ASX:EDV) was one of the winning stocks today despite the market sell-off amid a rally for consumer staples stocks today. The a2 Milk Company (ASX:A2M) also jumped more than 2% today after Bell Potter upgraded the premium dairy company’s shares to a buy rating with a price target of $6.35 per share on the belief that its FY22 results came in ahead of expectations and that strong earnings growth can be seen to continue through to FY26.
On the losing front, Pointsbet Holdings (ASX:PBH) continued to be sold-off sharply today with the share price falling more than 15% during the session as investors continue punishing the online sports betting company for its FY22 results released yesterday.
The most traded stocks by Bell Direct clients today were Nickel Industries (ASX:NIC), BHP Group (ASX:BHP), and the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ).
As for what to watch overnight, initial jobless claims in the US for last week will be released, with the market expecting an increase to 246,000.
Description:
Well earnings season has now wrapped up, and Aussie shares are expected to start the month of September lower, amid a further sell-off in the US as investors prepare for even higher interest rates.
All three US benchmarks closed lower for the fourth straight session, and for the month of August, the Dow Jones, S&P500 and Nasdaq all finished about 4% lower.
Across the sea in Europe, markets also closed lower as investors continue to fear higher interest rates and a looming economic downturn.
What to watch today:
- The ASX200 is expected to open 1% lower if you go by the SPI futures.
-
In commodities:
- Oil prices continue to slide so energy shares like Woodside Energy (ASX:WDS) and Santos (ASX:STO) could have another tough day ahead. Recession fears continue to weigh on sentiment.
- The gold price traded lower, meaning gold has recorded its fifth monthly decline in a row. Keep an eye on stocks like Gold Road Resources (ASX:GOR), Newcrest Mining (ASX:NCM) and Northern Star Resources (ASX:NST).
- The spot iron ore price trades nearly 4% lower so keep watch of ASX iron ore players like Fortescue Metals (ASX:FMG), BHP and Rio Tinto (ASX:RIO).
- Stocks going ex-dividend today include AGL Energy (ASX:AGL), BHP Group (ASX:BHP), Credit Corp Group (ASX:CCP), Jumbo Interactive (ASX:JIN), Platinum Asset Management (ASX:PTM) and Whitehaven Coal (ASX:WHC).
- If you hold Dicker Data (ASX:DDR) you will receive your dividend payment today.
- A new company debuting on the ASX today is Aeramentum Resources, an Australian mineral exploration company. It will be trading under the ticker code AEN.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Nickel Industries (ASX:NIC), with a price target of $1.83. Bell Potter believe NIC has a strong growth outlook and undemanding valuation multiples. At its current share price of $0.99, Bell Potter’s price target of $1.83 implies about 85% share price growth in a year.
- Trading Central has a bullish signal on Computershare (ASX:CPU) indicating that the stock price may rise from its close of $24.70 to the range of $26.50 - $26.90 in the next 6 days according to standard principals of technical analysis.
The Australian market’s rally over the past few days was very short lived, as the local market closed 0.16% lower today, weighed down by a sharp sell-off in energy stocks. Despite today’s losses, the local market posted a 0.6% gain.
The markets may have also been sold off after Australia’s second quarter construction work done data was released showing a decline of 3.8%, the largest quarterly decline in almost 5-years as the country’s building industry was heavily impacted by strong inflationary pressures and capacity constraints on the building front.
Private sector credit data for Australia was also released today showing an increase of just 0.7%, which was in-line with market consensus with all components of credit increasing in July including owner-occupier housing, investor housing, other personal and business.
Clinuvel Pharmaceuticals (ASX:CUV) was the top performing stock on the ASX200 today surging more than 17% a day, after releasing FY22 results including the company’s sixth straight annual profit driven by strong revenue growth. Zip Co (ASX:ZIP) also had investors piling in today, despite no price sensitive news released by the buy now, pay later provider today.
On the losing front, Pointsbet Holdings (ASX:PBH) took the biggest hit today, tumbling more than 13% after releasing FY22 results that disappointed investors. The online sports betting company reported its net loss increased by 43% to $267.7 million and EBITDA fell to a $243.6 million loss, but revenue increased 52% to $296.5 million. Mineral Resources (ASX:MIN) shares were also sold off again today, as investors continue to sell out following the release of the mining company’s FY22 results on Monday.
The most traded stocks by Bell Direct clients today were BHP Group (ASX:BHP), Core Lithium (ASX:CXO) and the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ).
As for what to watch overnight, further employment insights will be released in the US through ADP Employment Change data for August which will give a further idea of just how tight the US labour market is at present.
US stocks extended their losing streak to a third day on Tuesday as interest rate pressures continue to weigh heavily on the market. The Nasdaq again led losses, closing the session down 1.12%, which extended the Nasdaq’s year to date loss to 24.05%. US home price index data for June was released yesterday showing slowed growth for the month as higher mortgage rates make home ownership less affordable. US job openings data was also released yesterday which showed job openings rose to a seasonally adjusted 11.2 million in July as employers took on more workers in a tight labour market.
Over in Europe, the FTSE100 fell 0.9%, the CAC lost 0.2% but the DAX gained 0.5%.
What to watch today:
- The SPI futures are anticipating the local market will open 0.85% lower today following the broad sell-off on Wall St overnight.
- In commodities:
- Iron ore fell 4.1% to trade below US$100 a tonne as COVID-19 outbreaks continue to cloud demand from China.
- Oil declined 5.5% yesterday to hit US$99.28 a barrel.
- Gold is trading down 0.7% to US$1,724 an ounce.
- Reporting season continues today with Atlas Arteria (ASX:ALX) and St Barbara (ASX:SBM) releasing first half and FY22 results respectively.
- On the economic front today, we can expect to gain an insight into the state of Australia’s building crisis with construction work data for the second quarter due out today with markets expecting growth of just under 1%. Private sector credit data for July is also out today, with analysts’ expecting a decline from June to 8.2% for July.
Trading Ideas:
- Trading Central has identified a bullish signal on Cobram Estate Olives (ASX:CBO) based on a pattern that formed over a 53-day period, indicating the stock price may rise over this same amount of time from the close of $1.67 to a range between $1.74-$1.78, according to standard principles of technical analysis.
- Citi has downgraded its rating from Buy to Neutral on Healius (ASX:HLS) and reduces its price target from $4.30 to $4.00 following the release of the company’s FY22 results noting that HLS’ results were significantly assisted by high levels of COVID-19 testing but the company failed to issue any guidance for FY23.
The Australian share market regained some ground on Tuesday, closing the session 0.5% higher, as investors piled back into technology stocks, giving long-term tech shareholders a brief sigh of relief. Energy stocks also rallied again during today’s session.
Mineral Resources (ASX:MIN) led the gains on the ASX today as investors bought into the mining company following CEO Chris Ellison sharing the company’s vision to build a battery manufacturing plant in Western Australia over the next couple of years. MIN also announced it is pushing ahead with the $3b Onslow Iron Ore project with the backing of China’s biggest steel maker. The a2 Milk Company (ASX:A2M) also jumped more than 6% today after releasing strong FY22 results yesterday.
On the losing front, Sandfire Resources (ASX:SFR) shares came under fire today as investors digested the copper miner’s FY22 results today. Despite reporting record sales revenue of $922.7 million, investors were more focused on the company’s scrapping of its final dividend this financial year which led to the sell-off in SFR stocks. Ramelius Resources (ASX:RMS) stocks were also sold off today, closing the session down more than 5%.
The most traded stocks by Bell Direct clients today were BHP Group (ASX:BHP), Core Lithium (ASX:CXO) and PolyNovo (ASX:PNV).
On the economic data front today, Australian building permits data for July was released showing a decline of 17.2% which significantly exceeded the markets’ expectations of a 2% decline, indicating the country’s building industry remains in crisis mode. Private house approvals data for July was also released today also showing a decline from June to 0.7% which beat market expectations of a 0.5% rise.
As for what to watch overnight, US house price index data for June will be released as well as JOLTs Job Openings data for July in the US.
Well, the sell-off continued overnight. US equities declined further with all three major benchmarks closing in the red, amid increasing concerns over rising rates and tighter US monetary policy. The Dow ended the session down 0.6%, the S&P500 down 0.7%, while the Nasdaq dropped just over 1% at the close. Tech was also the worst performing S&P500 sector, while energy and utilities outperformed.
What to watch today:
- Despite the broad selling in New York, the SPI futures are suggesting the Australian market will open 0.26% higher at the open this morning.
-
In commodities,
- The oil price has jumped, current trading over 4% higher, as supply-side concerns have outweighed fears that a prolonged economic slowdown will affect fuel demand. Also last week, Saudi Arabia flagged possible OPEC production cuts to stabilise volatile markets. So keep watch of oil producers today such as Santos (ASX:STO), Woodside Energy (ASX:WDS) and Beach Energy (ASX:BPT).
- The gold price has dropped, tracking the downturn in the US dollar.
- Iron ore continues to gain, bouncing back after hitting its lowest level in more than a month.
- Companies reporting their earnings results today include Dicker Data (ASX:DDR), Healius (ASX:HLS), IGO (ASX:IGO), Link Administration (ASX:LNK), Woodside Energy (ASX:WDS) and WISR (ASX:WZR).
- Companies set to go ex-dividend today, which often sees their share prices fall, include Accent Group (ASX:AX1), Bega Cheese (ASX:BGA), Blackmores (ASX:BKL), Endeavour Group (ASX:EDV), OZ Minerals (ASX:OZL), Treasury Wine Estates (ASX:TWE), Wesfarmers (ASX:WES) and Woolworths (ASX:WOW).
Trading Ideas:
- Bell Potter have upgraded their rating on The a2 Milk Company (ASX:A2M) from a Hold to a Buy. A2M yesterday reported FY22 underlying NPAT ahead of Bell Potter’s expectations of NZ$122.6 million. Revenue and EBITDA also increased and the company’s FY23 outlook is promising. Bell Potter increased their price target form AU$4.75 to AU$6.35. And at A2M’s current share price of AU$5.40, this implies 17.6% share price growth in a year.
- Trading Central have identified a bullish signal in Galileo Mining (ASX:GAL) indicating that the stock price may rise from the close of $1.25 to the range of $1.46 to $1.50 over 28 days, according to the standard principles of technical analysis.
The Australian market performed exactly as expected today following the sharp sell-off on Wall Street on Friday as investor fears of prolonged interest rate hikes were strengthened on the back of comments made by Fed Chair Jerome Powell at the Jackson Hole Symposium. The ASX200 closed Monday’s session 1.95% lower, with all sectors closing the day in negative territory led by technology stocks tumbling more than 4%.
Technology stocks were the hardest hit in today’s sell-off as investors flee growth stocks that have the potential to be heavily impacted by interest rate hikes. The gold sector also fell more than 4% amid weakness in the price of the commodity.
The best performing stocks today were Tyro Payments (ASX:TYR) after the payments solution provider released FY22 results including merchant numbers up 10%, transaction value up 34% and revenue up 37%, and the a2 Milk Company (ASX:A2M) also soared after releasing strong FY22 results and providing solid growth outlook for FY23.
On the losing front, PolyNovo (ASX:PNV) nosedived more than 17% during the session today after the medical device company released disappointing results last week. Chalice Mining (ASX:CHN) also dropped more than 9% today.
Looking at economic data, preliminary Australian retail sales data for July released today came in at 1.3% for the month which well exceeded the market expectations of an increase of just 0.3%. The retail sales in July may have beat expectations but is still very low compared to a rise of 16.5% last July.
The most traded stocks by Bell Direct clients today were Commonwealth Bank (ASX:CBA), BHP Group (ASX:BHP) and National Australia Bank (ASX:NAB).
As for what to watch overnight, investors will be keeping a close eye on Wall Street to see whether the broad market sell-off from Friday will continue this week as investor optimism was dampened by the idea that interest rates will continue to rise for the foreseeable future.
The local market closed 0.79% higher on Friday but was virtually unchanged for the week as a broad market sell-off early in the week offset the rally that ended the week. The big banks rallied on Friday along with the materials and energy sectors.
Bega Cheese (ASX:BGA) was the winning stock on Friday after the food company released full year results. Despite Bega’s NPAT falling 69% to $24.2 million, investors were impressed with the company’s revenue of more than $3 billion, which was up 45% year-on-year and the issuing of guidance for FY23 expecting EBITDA to be in the range of $160 million to $190 million for FY23 amid increased consumer prices across all channels.
Investors also bought into Viva Energy (AX:VEA) on Friday while selling off City Chic Collective (ASX:CCX) again after the retailer released disappointing results on Thursday, and Zip Co (ASX:ZIP) fell more than 5% on Friday. The common theme continues throughout reporting season, being that investors are selling out of stocks that fail to provide quantitative guidance for FY23, which for last week included Humm Group (ASX:HUM), Coles (ASX:COL) and Ramsay Health Care (ASX:RHC).
The most traded stocks by Bell Direct clients last week were IDP Education (ASX:IEL), Boral (ASX:BLD) and Alumina (ASX:AWC).
In the US and all three key indices closed lower on Friday after the commencement of the Jackson Hole where investor optimism was dampened by Fed Chair Jerome Powell saying the central bank must continue to raise interest rates to stop high inflation becoming a permanent aspect of society.
What to watch today:
- The ASX is expected to open almost 1.5% lower following the sell-off on Wall Street on Friday.
- As we head into the tail end of earnings season, we have over 60 companies set to report this week, kicking off with Fortescue Metals (ASX:FMG) this morning.
- On the commodities front, crude oil is trading almost half a percent higher and up 35% year-on-year, brent is up almost 1.5%, natural gas is down slightly but remains up 112% year-on-year, iron ore is also up just under 2%, but gold is trading 1.2% lower.
- Investors will be awaiting for the preliminary retail sales data to be released for July out today with the market expecting a rise of 0.3%. Australian building Permits for July is also out on Tuesday which will give an insight into the state of the country’s building crisis.
Trading Ideas:
- Trading Central has identified a bullish signal on Charter Hall Group (ASX:CHC) due to a pattern forming over a 79-day period, indicating the stock price may rise from the close of $13.36 per share to the range of $15.70 to $16.20 per share over the same period of 79 days according to standard principles of technical analysis.
- Citi maintains a buy rating on Perpetual (ASX:PPT) but have lowered its price target on the stock to $30 per share following the release of FY22 results last week and more importantly, the company’s acquisition of competitor Pendal (ASX:PDL), which was announced on the same day the results were released. The downgrade of the price target is on the back of Citi acknowledging both equity market risk and the apparently negative sentiment towards the transaction which could prevent the stock making near term headway.
The Aussie share market declined 0.9% this week (Mon-Thu) as investor sentiment continues to ride on recession fears.
In this week's wrap, Grady covers:
- (0:12) Why it may be time to reposition your portfolio
- (1:04) Three sectors to watch in an inflationary market environment
- (2:50) An update on reporting season
- (3:23) Energy stocks surging following renewed focus on nuclear
- (4:33) The most traded stocks & ETFs by Bell Direct clients
- (4:57) Five economic news items to watch out for
The highly anticipated 3-day Jackson Hole Economic Symposium kicked off overnight. It’s an annual event that focuses on an important economic issue that faces world economies each year. This year they’re discussing “reassessing constraints on the economy and policy” and over 100 global central bankers, academics, finance ministers and journalists from around the world attend. It’s closely followed by market participants because any unexpected remarks emanating from the heavyweights at the symposium have the potential to affect global stock markets. Mostly, investors are looking for clues on whether policymakers will cut rates when the current hiking cycle is over.
Also, the GDP growth rate for the US was released. With an upward revision to consumer spending and inventories. The US economy contracted an annualised 0.6% in Q2, which was less than forecasts.
US equities closed higher. The Dow up 1%, the S&P500 up 1.4% and the Nasdaq up 1.7%.
What to watch today:
- The SPI futures are suggesting the Australian market will open flat this morning.
- The week is ending with another long list of companies set to publish their earnings results today. Some companies include uranium production company Paladin Energy (ASX:PDN), which has gained over 15% this week and over 11% in yesterday’s session alone. Blue-chip retail conglomerate Wesfarmers (ASX:WES) is also reporting today. And Ramsay Healthcare (ASX:RHC) is also set to publish results. They’re the largest operator of private hospitals in Australia and provide healthcare in 10 different countries.
- In commodities,
- The oil price has dropped, failing to hold onto earlier gains, as investors balance signs of tightening supplies.
- Gold is trading in the green, rising for a third straight session as the US dollar eases.
- And iron ore is also higher, now recovering from the lowest level it hit in over a month.
- Companies set to go ex-dividend today include Alumina (ASX:AWC), GUD Holdings (ASX:GUD), Lendlease Group (ASX:LLC) and Newcrest Mining (ASX:NCM).
Trading Ideas:
- Bell Potter maintain a Buy rating on Eagers Automotive (ASX:APE), after the company reported yesterday. Revenue was up 4%, but below Bell Potter’s forecast , however its underlying profit before tax margin came in higher than the broker’s forecasts. Bell Potter have increased their price target form $14.75 to $15, and at its current share price of $13.16, this implies 14% share price growth in a year.
Trading Central have identified a bullish signal in Qube Holdings (ASX:QUB), indicating that the stock price may rise from the close of $2.94 to the range of $2.96 to $3, over 33 days, according to the standard principles of technical analysis.
The Australian market extended its gains into Thursday, adding just under 1% to close the session in positive territory led by a rally for real estate and energy stocks.
The big story of today’s session was Australian investment fund and trustee group Perpetual (ASX:PPT) announced it is acquiring its competitor, Pendal Group (ASX:PDL) in a cash and scrip deal to create a $201 billion global asset manager.
Uranium stocks soared during today’s session following reports Japan is considering the development of new nuclear reactors, indicating the country has a renewed focus on nuclear energy, years after many of the country’s plants were shut down. Uranium stocks on the ASX jumped following the reports including Paladin Energy (ASX:PDN) surging over 20% in two sessions and uranium-linked stocks like Silex Systems (ASX:SLX) up 6.8% today. Paladin Energy (ASX:PDN) was the winning stock today, up around 20% over the last two sessions following the reports out of Japan. Insignia Financial (ASX:IFL), formerly IOOF, also soared over 11% today on the back of FY22 results being released including the company swinging to a profit in the financial year.
On the losing front, Woolworths (ASX:WOW) shares were sold off today following the release of the company’s FY22 results including EBIT falling 2.7% and the company taking lower margins as customers shift away from price-inflated products like beef and fresh veggies. Fashion retailer City Chic (ASX:CCX) also fell out of favour with investors today, with the company’s share price tumbling more than 20% also on the release of FY22 results. Despite reporting revenue growth of 39% and underlying NPAT up 7.7%, investors were more shocked to see City Chic’s inventory almost tripling and the company diving into a negative cash flow position.
On the economic front today, across the ditch in New Zealand retail sales for the second quarter fell 2.3%, which was well below the market expectations of a 1.7% rise. This is the second consecutive quarterly decline in retail sales which raises the risk that the NZ economy fell into a technical recession in the first half of the year.
US Crude Oil Inventories data was also released today showing stockpiles of the commodity in the US declined by 3.3 million barrels, which added to the upward price pressure on crude oil today.
The most traded stocks by Bell Direct clients today were Djerriwarrh Investments (ASX:DJW), Whitehaven Coal (ASX:WHC) and Woodside Energy (ASX:WDS).
As for what to watch overnight, US GDP data for the second quarter will be released just before midnight tonight Australian eastern time which investors have been waiting for, to see whether the world’s largest economy is in a technical recession or not.
An uncertain week continues on Wall Street. The three major benchmarks closed higher overnight. It was a slow session however with traders a bit hesitant to make big moves. Traders are cautious ahead of Friday night in the US, when we’ll receive a monthly update on inflation which of course is highly anticipated as inflation is currently one of the key drivers of markets. And on Friday Jerome Powell, the head of the central bank will also deliver a speech, which could have an impact on the market’s performance next week.
What to watch today:
- The SPI futures are suggesting the Australian market will rise 0.48% at the open this morning.
- In commodities,
- The price of oil is trading almost 2% higher and crude futures have hit the highest levels in three weeks, due to the concerns about tight supply. Crude oil is still down about 25% from the peak in June, as monetary tightening we’re seeing globally right now is creating concerns of an economic slowdown, which would dampen consumption as major central banks stem demand with rate hikes. Watch Santos (ASX:STO) and Woodside Energy (ASX:WDS) today.
- Gold is trading higher, moving away from the near 4-week low reached earlier in the week,
- Iron ore has rebounded, regaining some of its earlier losses.
- Reporting season wise, travel stocks will be on watch, with a few big travel names set to publish earnings, including Air New Zealand (ASX:AIZ), Flight Centre (ASX:FLT), and Qantas (ASX:QAN). And other big names reporting today include South32 (ASX:S32), Pilbara Minerals (ASX:PLS), Ramelius Resources (ASX:RMS) and Woolworths (ASX:WOW). Company results continue to be the main driver for price movements this month, based on if earnings are above or below expectations.
- Companies going ex-dividend today, which may cause their prices to fall as investors take their profits include Baby Bunting (ASX:BBN), Codan (ASX:CDA), Deterra Royalties (ASX:DRR), JB Hi-Fi (ASX:JBH) and REA Group (ASX:REA).
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on De Grey Mining (ASX:DEG), which is due to release the Pre-Feasibility Study on its 100%-owned Mallina Gold Project in the current quarter. The broker’s valuation is $1.80, and at DEG’s current share price of $0.93, this implies 93.5% share price growth in a year.
- Trading Central have identified a bullish signal in Champion Iron (ASX:CIA), indicating that the stock price may rise from the close of $5.34 to the range of $6.10 to $6.25 over 36 days, according to the standard principles of technical analysis.
The Australian market posted its first positive close for the week today, with the ASX200 closing the session up 0.52%.
The energy sector led the gains today as investors piled into the sector following its solid performance in Europe and the US overnight.
Paladin Energy (ASX:PDN) was the winning energy stock today, gaining more than 8% at the closing bell despite no price sensitive news released by the uranium miner today.
Some of the key winners and losers today were WiseTech Global (ASX:WTC) which surged more than 10% during the session following the release of impressive FY22 results including underlying NPAT soaring 72% and the signing of 5 new rollout deals for its CargoWise software including UPS.
Iluka Resources (ASX:ILU) also soared just under 10% today after releasing half-year results including NPAT rocketing 186%, a 25cps interim dividend and mineral sands revenue jumping 30%.
On the losing front, EML Payments (ASX:EML) tumbled more than 10% today after the payments technology provider announced its Sentenial business has identified recent fraudulent activity that could result in losses up to $7.9m.
Nanosonics (ASX:NAN) also fell more than 5% today following the release of the company’s full year results yesterday.
On the economic front today new home sales in the US fell by almost 13% for July while locally, the RBA’s head of domestic markets Jonathan Kearns, said the climate crisis is a significant issue for the economy and society.
The most traded stocks by Bell Direct clients today were: BetaShares Geared Australian Equity (Hedge Fund) (ASX:GEAR), BHP Group (ASX:BHP), NOVONIX (ASX:NVX), and Whitehaven Coal (ASX:WHC).
As for what to watch overnight, investors will be keeping a close eye on US GDP data for the second quarter released tomorrow to determine whether the world’s largest economy is in recession territory, as well as initial jobless claims in the US which will reveal if the labor market in the US is continuing to cool.
The local market closed lower for the second straight session, down 1.2% to close below 7,000 points for the first time in two weeks. Shares were lower after a number of companies reported soft results, including Endeavour Group (ASX:EDV) and online retailer Kogan (ASX:KGN).
Sectors wise, only the energy and utilities sectors posted gains, while the rest of the market was deep in the red, with the consumer staples sector experiencing a hefty 3.8% drop.
Altium (ASX:ALU) jumped 20% higher after impressing the market with its FY22 results that beat expectations. The software company reported a 23% increase in revenue and an EBITDA margin of 36.7%, and its NPAT grew 57%. Meanwhile, the worst performer was Endeavour Group (ASX:EDV) after its disappointing report card.
The most traded stocks by Bell Direct clients yesterday included IDP Education (ASX:IEL), the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR) and BHP Group (ASX:BHP).
In the US, all three benchmarks fell again for the third session as investors brace for the Federal Reserve Chairman Jerome Powell’s remarks at Jackson Hole on Friday. And European markets also closed lower as investors monitored the rise in oil prices and the August flash PMI which showed that business activity had contracted for the second straight month.
What to watch today:
- Despite Europe and the US closing lower, the ASX200 is expected to open 0.22% higher if you go by the SPI futures.
- Confession season continues to be the key focus today with lots of companies reporting. Some to keep an eye on include Coles (ASX:COL), Domino’s Pizza (ASX:DMP), Iluka Resources (ASX:ILU) and WiseTech Global (ASX:WTC).
- In commoditiesOil prices rebounded strongly as Saudi Arabia hinted the idea at a possible output cut.
- The gold price rose for the first time in six sessions as the US dollar and Treasury yields fell following weak US business activity data.
- The spot iron ore price trades at US$105 a tonne.
- Stocks going ex-dividend today include: Telstra (ASX:TLS), SG Fleet Group (ASX:SGF) and Pact Group (ASX:PGH).
- A new company debuting on the ASX today is Heavy Rare Earths, an Australian mineral exploration company. It will be trading under the ticker code HRE.
- If you hold Janus Henderson Group (ASX:JHG) you will receive your dividend payment today.
- Fisher & Paykel Healthcare (ASX:FPH) and Straker Translations (ASX:STG) will be holding their AGMs today.
Trading Ideas:
- Bell Potter have downgraded its rating on Nanosonics, from a Hold to a Sell with a price target of $4.05. Nanosonics has rallied hard off its lows from earlier this year, however, investment arithmetic is stretched. In Bell Potter’s view a material portion of the valuation is attached to prospective revenues from products yet to obtain regulatory approval let alone commercial validation. At its current share price of $4.68, this implies about -14% share price growth in a year.
- Trading Central has a bullish signal on foreign exchange company OFX Group (ASX:OFX) indicating that the stock price may rise from its close of $2.66 to the range of $3.45 – $3.60. That’s a rise of around 30-35% and it’s forecasted to occur in the next 33 days according to standard principals of technical analysis.
Our local market came under pressure yesterday, closing 1% lower. It was a sea of red, with all eleven industry sectors declining. Leading the losses was both the consumer discretionary and tech sectors, after a number of company announcements as well as speculation of aggressive US policy tightening to control inflation.
The best performing stock was NIB Holdings (ASX:NIB), after the private health insurer released its full year results, which showed a 7.2% increase in revenue, but a decline in its net profit, however the decline was slightly ahead of estimates. Other top performers included EML Payments (ASX:EML), Pilbara Minerals (ASX:PLS) and Telix Pharmaceuticals (ASX:TLX). Meanwhile, Adbri (ASX:ABC) tumbled 17% after wet weather disruptions and rising fuel and energy prices impacted its profits.
Some of the most traded stocks by Bell Direct clients yesterday included BHP Group (ASX:BHP), the BetaShares Australian Strong Bear Hedge Fund ETF (ASX:BBOZ) and aerial imagery technology business Nearmap (ASX:NEA).
In the US, all three benchmarks started the new trading week in the red after renewed fears of aggressive rate hikes returned to Wall Street. Consumer discretionary, communication services and tech stocks were hit the hardest. So we saw the Dow tumble more than 600 points, experiencing its worst day since June. The S&P500 was down 2.1% and the Nasdaq fell 2.6%.
What to watch today:
- Following the US, the SPI futures are suggesting that our market will follow with a fall of 0.6% at the open.
- Companies reporting their earnings today include: AMA Group (ASX:AMA), Alumina (ASX:AWC), Boral (ASX:BLD), Breville (ASX:BRG), Estia Health (ASX:EHE), Monadelphous (ASX:MND) and HUB24 (ASX:HUB).
In commodities:
- Oil prices traded flat following the Saudi energy minister stating that OPEC could cut production to confront market challenges.
- The gold price declined as the US dollar rallied and as the looming interest rate hikes dented bullion’s appeal.
- The spot iron ore price is trading flat at US$104 a tonne.
- Some stocks going ex-dividend today include: intellectual property services group IPH (ASX:IPH), Domain Holdings (ASX:DHG) and Qualitas (ASX:QAL).
- If you hold Transurban Group (ASX:TCL) you will receive your dividend payment today.
- Testing, inspection and certification business ALS (ASX:ALQ) will be holding its AGM today.
Trading Ideas:
- Potter have maintained its Buy rating on Accent Group (ASX:AX1) and have increased its price target from $1.90 to $2. At its current share price of $1.71, this implies about 17% share price growth in a year.
- Trading Central has a bearish signal on Dexus (ASX:DXS) indicating that the stock price may fall from the close of $9.01 to the range of $8.56 - $8.64 in the next 33 days according to standard principals of technical analysis.
The local market closed just 1 point higher on Friday but gained just over 1% for the week led by the materials sector jumping more than 3.4% for the week. The energy sector had its best session in months with energy stocks boosted by the passing of the US Inflation Reduction Act last week.
Investors piled into Santos (ASX:STO) on Friday with the energy giant jumping more than 6% a day after releasing its first-half results including NPAT surging over 300% and revenue up 85%. Whitehaven Coal (ASX:WTC) also added over 6% on Friday while New Hope Corporation (ASX:NHC) and BHP Group (ASX:BHP) each gained over 4% during the session.
On the losing front, TPG Telecom (ASX:TPG) took the biggest hit on Friday, tumbling more than 12% after the telco giant released first half results that were uneventful including service revenue coming in flat, average revenue per user up just 1%, and EBITDA down 5.3%. Inghams (ASX:ING) also fell over 9% and PointsBet (ASX:PBH) lost over 6.5%.
The most traded stocks by Bell Direct clients last week were IPH Limited (ASX:IPH), Worley (ASX:WOR) and Domino’s Pizza (ASX:DMP).
Over in the US, all three key indices closed lower on Friday. Investors took the latest minutes as the Fed being more hawkish about its approach to tackling inflation in the world’s largest economy, and fear another aggressive interest rate hike will follow in the September FOMC meeting.
What to watch today:
- The ASX is expected to open lower following a turbulent session on Wall Street on Friday.
- We are set for another bumper earnings season this week with over 115 companies set to report including Qantas (ASX:QAN), Ampol (ASX:ALD) and the Star Entertainment Group (ASX:SGR).
- In commodities, oil has rebounded from last week’s dip to trade 0.3% higher this morning, iron ore is trading flat, natural gas is up just under 1% and gold is trading more than half a percent lower.
- Economic news wise, investors will be keeping a close eye on US GDP data out later in the week to see whether the world’s largest economy continued to contract into a recession or rebounded to growth in the second quarter to ease recession fears currently plaguing the market.
Trading Ideas:
- Trading Central has identified a bullish signal on Red Dirt Metals (ASX:RDT) indicating the stock price may rise from the close of $0.49 to the range of $0.61-$0.63 over the next 48 days which was the amount of time the pattern took to form according to the standard principles of technical analysis.
- Bell Potter has reduced its target share price on Inghams Group (ASX:ING) to $2.90 following the release of the poultry group’s FY22 results including elevated costs and adverse sales mix.
- Trading Central has a bearish signal on Adairs (ASX:ADH) with a target price range of $1.65-$1.85, down from the close of $2.55, which may be achieved over the next 40 days according to standard principles of technical analysis.
We're excited to welcome Grady Wulff, our new Market Analyst at Bell Direct. Grady and the Market Analyst team are dedicated to bringing you daily insights to support you in your investment journey.
In her first weekly wrap, Grady covers:
- (0:42) Why the energy sector is in the spotlight
- (2:07) An update on reporting season
- (2:42) Consumer staples stocks outperforming
- (2:55) Bell Potter's energy stock picks
- (3:34) The most traded stocks & ETFs by Bell Direct clients
- (4:00) The latest unemployment reading
Our local market yesterday closed 0.2% lower. The tech sector declined the most among the 11 sectors, while utilities also weighed down on the market. On the other end, energy and healthcare stocks advanced. And it was one of the busiest days of earnings results so far, with a long list of companies reporting.
On the ASX200, we saw intellectual property group IPH (ASX:IPH) shares soar 16%, following news that the company has agreed to acquire Smart & Biggar, which is a leading Canadian intellectual property firm. Blackmores (ASX:BKL) shares fell 10% and it was the worst performing stock yesterday. While Blackmores reported a rise in profit and revenue, it also warned about rising costs and supply chain issues.
The most traded stocks by Bell Direct clients were CSL Limited (ASX:CSL), Lake Resources (ASX:LKE), ResMed (ASX:RMD) and BHP Group (ASX:BHP).
US equities gained overnight, with all three major benchmarks closing slightly higher. The Dow was up 0.6%, while the S&P500 and the Nasdaq both gained 0.2%. And European stocks also closed higher after a choppy session, amid continuing market caution over the inflationary outlook. The STOXX 600 was up 0.3% by the close.
What to watch today:
- The Australian market is set open slightly higher, with the SPI futures suggesting a 0.3% rise at the open this morning.
- In commodities, the price of oil is on the rise, now moving further away from the 6-month lows reached earlier in the week, as falling US crude inventories more than offset the concerns around a global economic slowdown. Gold prices have steadied, however have fallen for three straight sessions, with the latest US Fed policy meeting minutes being released, which emphasised the need to keep up rising rates. And iron ore is trading lower with an extended downturn in demand for industrial inputs in China.
- Some companies set to publish results today include AGL Energy (ASX:AGL), Cochlear (ASX:COH), Cleanaway Waste Management (ASX:CWY), Healius (ASX:HLS), Inghams (ASX:ING) and Newcrest Mining (ASX:NCM).
Trading ideas:
- Bell Potter maintain a Speculative Buy rating on Telix Pharmaceuticals (ASX:TLX) after the company reported its results. Bell Potter have lowered their valuation from $9 to $8.65, and at its current share price of $6.63 this implies 30.5% share price growth in a year.
- Trading Central have a identified a bearish signal in Adairs (ASX:ADH) indicating that the stock price may fall from the close of $2.55 to the range of $1.65 to $1.85 over 40 days according to standard principles of technical analysis.
Yesterday, our local market posted its third straight day of gains, closing 0.3% higher, with consumer staples and consumer discretionary stocks advancing the most, while the healthcare sector declined the most, weighed down by a 1.3% fall in CSL’s share price after its results release yesterday.
The biggest gainer yesterday was Challenger (ASX:CGF), with the stock regaining some of its losses after its tumble on Tuesday, following its results release. Its gain yesterday was likely off the back of broker upgrades from both Citi and Morgans. Meanwhile, one of the biggest decliners was Magellan Financial Group (ASX:MFG) after investors were not impressed by the company’s full-year earnings for FY2022.
The most traded stocks by Bell Direct clients yesterday included Worley (ASX:WOR), Lake Resources (ASX:LKE), Santos (ASX:STO) and CSL Limited (ASX:CSL).
In the US, all three benchmarks closed lower, with the Dow Jones snapping its 5-day winning streak. Investors were assessing the latest retail data, as well as the minutes from the Federal Reserve. The central bank suggested that there are more rate hikes in the pipeline, but the pace could slow. And in Europe, markets pulled back and the latest CPI data was released, which showed that UK inflation had risen to another 40-year high in July, as food and energy prices continue to surge.
What to watch today:
- Following the negative sessions over on Wall Street and in Europe, the SPI futures are suggesting that our market will follow with a fall of 0.18% at the open.
- The all-important unemployment rate for July will be released today, and it’s expected to remain unchanged at 3.5%.
- There are a number of companies releasing their earnings results today. These include: Auckland International Airport (ASX:AIA), Blackmores (ASX:BKL), Evolution Mining (ASX:EVN), Iress (ASX:IRE), Orora (ASX:ORA) and Transurban Group (ASX:TCL).
- In commodities, the crude oil price rose as US crude stockpiles fell. The gold price was trading in the red, following the release of the minutes from the US Fed meeting. And the spot iron ore price currently trades at US$108 a barrel, down about 2.7% this week.
- Stocks going ex-dividend today include QBE Insurance Group (ASX:QBE), Insurance Australia Group (ASX:IAG), MyState (ASX:MYS) and GPT Group (ASX:GPT).
- Accounting software business, Xero (ASX:XRO) will be holding its AGM today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on consumer lending company, Money3 Corporation (ASX:MNY) with a reduced price target from $3.22 to $2.90. Money3 recently released its financial year results. At first glance, the results were a good set of figures showing good growth in profitability, with NPAT up 31.6%, which was slightly better than the guidance. The loan book was up 22.0% and whilst this is impressive, it fell short of the previous guidance. At its current share price of $2.42, this implies 19.8% share price growth in a year.
- Trading Central has a bullish signal on Goodman Group (ASX:GMG) indicating that the stock price may rise from the close of $21.06 to the range of $24.70 - $25.50 in the next 74 days according to standard principals of technical analysis.
The Australian market had a solid session on Tuesday, with the key index closing the day at a 10-week high. The materials sector led the charge, closing the day more than 1.66% higher on the back of mining giant BHP (ASX:BHP) releasing record results for FY22, which in-turn caused OZ Minerals (ASX:OZL) shares to lift 1.3%. Gains in the materials sector were dampened though by Lake Resources (ASX:LKE) tumbling over 8%.
Life360 (ASX:360), a stock recommended by Bell Potter as one to watch in FY23, soared almost 5.5% yesterday after also releasing strong half year results including monthly active users topping 42 million and subscription revenue lifting 88%. Investors sharply sold-off Challenger (ASX:CGF) shares after the investment management firm released FY22 results including a 57% decline in annual profit.
Lake Resources (ASX:LKE) and Core Lithium (ASX:CXO) also fell over 8% and 7% respectively yesterday and were two of the most traded stocks by Bell Direct clients during the session, alongside Betashares Australian Equities Strong Bear Hedge Fund (ASX:BBOZ) and Amcor (ASX:AMC).
Taking a look at Wall Street overnight, the key US indices closed mixed with the Dow Jones and S&P500 boosted into positive territory by strong earnings results released by Walmart and Home Depot indicating consumer spending could remain strong. The tech-heavy Nasdaq however closed the session in the red. US Industrial production data for July released yesterday showed the world’s largest economy’s value of production output rebounded for the month to 0.6% which was double what markets were expecting. US building permits for July also beat consensus for July with 1.674 million issued over the month, but new house starts in the US fell to 1.44 million in data released yesterday. Over in Europe, the Stoxx, FTSE, DAX and CAC each closed marginally higher on Tuesday but are struggling to build on the strong momentum from last week’s rally.
What to watch today:
- Locally today, investors will be awaiting FY22 results released by specialty biotech company CSL (ASX:CSL) and oil and gas giant Santos (ASX:STO).
- On the commodities front, Crude Oil continues its decline, down more than 2.55% this morning, iron ore is also down more than 3%, natural gas is up over 7% and gold is trading just under 1% lower this morning.
- Australia’s wage price index data for the second quarter is out today and investors will be keeping a close eye to see if the forecasted 0.1% growth was achieved in the quarter.
Trading Ideas:
- Trading Central has a bullish signal on Catapult Group International (ASX:CAT) after detecting a ‘Head and Shoulders Bottom’ chart pattern formed over 84-days which is roughly the period in which the target price range of $1.44 to $1.54 per share may be achieved according to standard principles of technical analysis.
- Trading Central has identified a bearish signal on retail group Adairs (ASX:ADH) following the detection of a ‘Continuation Wedge’ chart pattern forming. The bearish signal indicates the stock may fall from the close of $2.52 per share to the range of $1.55 to $1.70 per share. The pattern formed over 42-days which is roughly the period in which the target price may be achieved, according to standard principles of technical analysis.
Our local market closed 0.5% higher with the real estate and consumer discretionary sectors in the lead, while energy and financials were in the red.
Beach Energy (ASX:BPT) dropped the most on the ASX200 yesterday, after reporting its results. Although revenue jumped, the oil and gas producer reported a lower-than-expected production outlook, which disappointed investors. On the other hand, mining stocks Core Lithium (ASX:CXO), Champion Iron (ASX:CIA) and Lake Resources (ASX:LKE) closed with strong gains.
The most traded stocks by Bell Direct clients were BHP Group (ASX:BHP), Bowen Coking Coal (ASX:BCB) and Telstra (ASX:TLS).
Overseas, investors monitored market reactions to weak Chinese economic data. China’s industrial output and retail sales data for July missed expectations. Also, China’s central bank cut rates unexpectedly, raising concern over China’s economic recovery. However, European markets still managed to close marginally higher, while US equities rallied as investors prepared for a big week of retail earnings. Wall Street started the session lower with declines in energy and financials, however later rebounded into positive territory as consumer staples, consumer discretionary and communication services moved higher. All three major benchmarks closed in the green.
What to watch today:
- Following US equities, the SPI futures are suggesting the Australian market will rise 0.32% at the open this morning.
- In commodities, oil has tumbled to an almost six-month low as industrial production figures in China missed expectations, as China is a top oil importer. This added to the news of OPEC’s expectations of a decline in oil demand and supply increases. So today keep watch of energy producers such as Santos (ASX:STO) and Woodside Energy (ASX:WDS). Gold and iron ore are also trading in the red.
- Watch the share price movements of these company’s reporting their earnings results today: Life360 (ASX:360), BHP Group (ASX:BHP), EML Payments (ASX:EML), Goodman Group (ASX:GMG) and James Hardie Industries (ASX:JHX).
- Stocks that are set to go ex-dividend today include Computershare (ASX:CPU), Genworth Mortgage Insurance (ASX:GMA) and GQG Partners (ASX:GQG). Remember that this often sees share prices fall, as investors take their profits.
Trading Ideas:
- Bell Potter maintain their Buy rating on Beach Energy (ASX:BPT). The company reported EBITDA and NPAT both below Bell Potter’s expectation, however, have a strong, fully funded energy production growth outlook. Bell Potter’s have lowered their price target to $2.30, and at its current share price of $1.64, this implies 40% share price growth in a year.
- Trading Central have identified a bearish signal in Alumina (ASX:AWC) indicating that the stock price may fall from the close of $1.53 to the range of $1.32 to $1.36 over 21 days, according to the standard principles of technical analysis.
The local market closed lower on Friday but gained 0.2% for the week to notch out a fourth straight week of gains. The energy sector defied the broader market sell-off on Friday, boosted by an almost 4% rise for Woodside Energy Group (ASX:WDS).
New Hope Corporation (ASX:NHC) and Beach Energy (ASX:BPT) also jumped more than 3% on Friday as investors piled into energy stocks amid rising energy prices. On the energy front, we will be keeping an eye on the sector this coming week following the passing of the Inflation Reduction Act in the US House over the weekend which includes US$369bn for energy security. On the losing front from Friday’s session, Lake Resources fell almost 13.5%, as some investors took profit from the company’s surge of 73% earlier in the week, while Novonix and Telix Pharmaceuticals also lost more than 8% and 7% respectively.
The most traded stocks by Bell Direct clients last week were Lake Resources (ASX:LKE), Core Lithium (ASX:CXO) and Orora (ASX:ORA).
All three key US market indices closed higher on Friday as investor beliefs that inflation may have reached its peak were strengthened on Thursday with inflation data coming in below analysts’ expectations. Consumer discretionary stocks led the charge in the US on Friday with the sector adding more than 2.3% while technology stocks were pushed higher by Meta jumping over 1% on reports of a new delivery partnership with DoorDash. The market rally extended into Europe on Friday with the Stoxx, FTSE and DAX each closing in the green as investors digested an array of economic data released including the UK economy contracting in the second quarter of 2022 as the country’s cost of living crisis worsened.
What to watch today:
- Following a strong session for the US to close out last week, the Australian market is set to open higher this morning.
- Reporting season remains the key focus of trading this week with Beach Energy (ASX:BPT), Bendigo and Adelaide Bank (ASX:BEN), Bluescope Steel (ASX:BSL), G.U.D Holdings (ASX:GUD), GPT Group (ASX:GPT) and tech giant JB Hi-Fi (ASX:JBH) releasing results today.
- Taking a look at the commodities, crude oil continues to decline from highs back in March on the back of OPEC lowering its demand forecast for the year ahead amid growing signs that a slowdown in global economic growth will curb oil demand. Iron ore is down almost half a percent, and natural gas prices have pulled back from a high on Friday, but gold is trading just under 1% higher.
- This week, we will be keeping a close eye on several economic data releases including the RBA’s meeting minutes for August, Australia’s Wage Price Index, US retail sales and Australia’s unemployment rate later in the week.
Trading Ideas:
- Trading Central have identified a bearish signal on Northern Star Resources (ASX:NST) through a ‘Continuation Wedge’ chart pattern forming, indicating the stock price may fall from the close range of $8.26 to $6.60-$6.90. The pattern formed over a 17-day period which is roughly the period of time in which the target price range may be achieved, according to standard principles of technical analysis.
- Trading Central has also identified a bullish signal on Clean Seas Seafood (ASX:CSS) on the basis of a ‘bottom triangle’ chart pattern forming over 33-days, indicating the stock price may rise from the close of 60 cents per share to between 73 – 77 cents per share. The chart pattern forming over 33-days is roughly the period of time in which the target price range may be achieved, according to standard principles of technical analysis.
The Aussie share market advanced 0.8% this week (Mon-Thu), with reporting season in full swing. 70% of companies either beat or reported earnings in line with expectations.
In this week’s wrap, Sophia covers:
- (0:32) Where to consider investing now
- (1:47) Why lithium shares soared this week
- (2:33) OZ Minerals (ASX:OZL) jumping 35% after rejecting takeover offer
- (3:00) The most traded stocks & ETFs by Bell Direct clients
- (3:37) Two economic news items to watch out for
Yesterday, our local market ended its three-day winning streak, declining 0.5% with nearly all sectors posting losses, except for the utilities and financial sector. The biggest laggard on the market was the tech sector, which follows the 1.2% tumble seen over in Wall Street for its Nasdaq index on Tuesday.
The biggest gainer yesterday was Imugene (ASX:IMU), which rose 9.3% after the company provided an update on its clinical trial, which is currently in its first Phase, recruiting patients with triple negative breast cancer. Meanwhile the worst performer was St Barbara (ASX:SBM), which issued its financial year 2023 guidance, entailing higher gold production however at higher costs compared to financial year 2022. The gold miner will postpone its full-year results presentation to the 31st of August.
The most traded stocks by Bell Direct clients yesterday included the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ), Mineral Resources (ASX:MIN) and BHP Group (ASX:BHP).
In the US, all three benchmarks rallied after a key inflation reading showed a better-than-expected slowdown for rising prices. The headline CPI for July lifted 8.5% year over year, whereas economists were expecting increases of 8.7%. And it was flat compared to June. So now the Fed will take this report into consideration along with other key economic data, ahead of its September meeting where it’s expected to lift interest rates again. And major tech stocks outperformed the market with Netflix up 6% and Meta up 5.8%.
What to watch today:
- Our market is expected to follow the US and open 1% higher if you go by the SPI futures.
- Reporting wise, some companies announcing their earnings today include AMP (ASX:AMP), Mirvac Group (ASX:MGR), QBE Insurance Group (ASX:QBE), ResMed (ASX:RMD), Arena REIT (ASX:ARF) and Telstra (ASX:TLS).
- In terms of forecast expectations:
- Citi is expecting ResMed to deliver $US827m NPAT.
- While consensus expects Telstra to deliver $2.085b NPAT
- And Mirvac Group, Citi is expecting the property developer to deliver NPAT of $615m, while consensus is less modest at $576.4m.
- In commodities:
- Oil prices were trading higher at about US$91 a barrel, following renewed gasoline demand and a cooler-than-expected inflation reading that drove investors into riskier assets.
- The gold price was also up, given the tame inflation report may mean the Fed may not opt for aggressive rate hikes.
- The spot iron ore price trades at US$111 a tonne.
- Rio Tinto (ASX:RIO) and SSR Mining (ASX:SSR) are set to go ex-dividend today.
- Online foreign exchange company OFX Group (ASX:OFX) will be holding its AGM today.
Trading Ideas:
- Citi have decided to maintain its Sell rating on Commonwealth Bank (ASX:CBA) with a price target of $90.75. Citi believe CBA’s results were in line with expectations and expect the focus to remain on the core earnings outlook where CBA has provided very little detail, instead referencing that medium term outlook on NIM, net interest margin (from Feb) is unchanged. What did other brokers think? Well Macquarie also have an Underperform rating with a less modest price target of $78.
- Trading Central has a bearish signal on Metcash (ASX:MTS) indicating that the stock price may fall from the close of $4.13 to the range of $3.00 - $3.20 in the next 65 days according to standard principals of technical analysis.
Our local market closed 0.13% higher yesterday as communication services and tech stocks advanced the most. Energy stocks also rallied yesterday, following the news that OZ Minerals (ASX:OZL) rejected BHP’s takeover bid. Copper and lithium stocks also gained, with Lake Resources (ASX:LKE) closing the trading session more than 15% higher. LKE was followed by Megaport (ASX:MP1), which released solid full-year results. Meanwhile, Imugene (ASX:IMU) and NAB declined the most.
The major miners were the most traded stocks by Bell Direct clients. These were Lake Resources (ASX:LKE), BHP Group (ASX:BHP), Fortescue Metals (ASX:FMG) and Pilbara Minerals (ASX:PLS).
In global markets, investors are trading cautiously as we wait on US inflation data. July’s US consumer price index data will be released at 10:30pm AEST today. European and US equities closed lower as investors assess the potential pace of the US Fed’s monetary policy tightening. The next Fed meeting isn’t until September; however tonight’s inflation figures will give us an indication of what to expect. In Europe, the STOXX 600 ended 0.6% lower with tech stocks leading the losses. And over in New York, the Dow Jones was down 0.2%, the S&P500 down 0.4% and the Nasdaq down 1.2%.
What to watch today:
- The Australian market is set to fall 0.56% at the open this morning, going by the SPI futures.
- In commodities,
- Oil is trading in the red, around US$90 per barrel, as investors weigh the potential for additional supply from Iran against the suspension of Russian oil exports. So as oil softens, watch energy producers such as Beach Energy (ASX:BPT) and Santos (ASX:STO).
- The price of gold however is trading higher, as investors continue to bid on the safe-haven metal as concerns around a US recession and geopolitical tensions weigh on the market. Some gold stocks to watch include Evolution Mining (ASX:EVN) and Northern Star Resources (ASX:NST).
- Iron ore is also higher, around US$113 a tonne. The price has rebounded after hitting its seven-month low at US$100.
- Commonwealth Bank (ASX:CBA), Computershare (ASX:CPU), Dexus (ASX:DXI) and Mineral Resources (ASX:MIN) will be releasing their results today.
- For CBA, Citi are expecting NPAT to be $9,578 million while consensus is lower at $9,282 million. Currently, Citi have a Sell rating on CBA with a price target of $90.75, and Morgan Stanley came out yesterday with an Underweight rating and a price target of $82. And watch out for Bell Direct’s coverage on CBA’s results later today.
Trading Ideas:
- Bell Potter maintain a Buy rating on Coronado Global Resources (ASX:CRN) after the company reported its half-year results yesterday. NPAT came in at US$562 million, above Bell Potter’s estimate of $522 million. The company also declared an ordinary interim dividend of US 7.5cps, higher than Bell Potter’s estimated US 6cps. CRN also maintained their guidance outlook, which includes a strong half in coal output. The broker increased their price target from $1.95 to $2.05, and at CRN’s current share price of $1.60, this implies 28.1% share price growth in a year.
- Trading Central have identified a bearish signal in AGL Energy (ASX:AGL), indicating that the stock price may fall from the close of $8.47 to the range of $7.75 to $7.90 over 17 days, according to the standard principles of technical analysis.
Yesterday, the Aussie share market started the new trading week in the green, with a very small gain of 0.1%. Leading the market was the energy, materials, and utilities sectors, all up over 1.4%. Weighing on the market however was the consumer discretionary, real estate and industrials sectors, which were all down more than 1%.
Looking at the ASX200 leaderboard, OZ Minerals (ASX:OZL) jumped 35.3% following BHP’s takeover bid, which OZL rejected as its board believes the offer significantly undervalues the company. Lake Resources (ASX:LKE) continues to rise, up nearly 16% yesterday, despite no news out from the company. Supportive factors include that the price of lithium still trades near record highs. The biggest decliners yesterday included Suncorp (ASX:SUN), Magellan Financial Group (ASX:MFG) and Credit Corp Group (ASX:CCP).
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), Sayona Mining (ASX:SYA), Zip Co (ASX:ZIP), as well as OZ Minerals (ASX:OZL).
Moving to the US, the market was mixed. The Dow Jones managed to post a small gain of 0.09%, while the S&P500 and Nasdaq were both down around 0.1%. Putting pressure on the market was tech company, Nvidia, which announced weaker-than-expected revenue for the second quarter, which consequently impacted semiconductor stocks. And some clean energy shares lifted after the Senate passed the Inflation Reduction Act, which includes billions of dollars aimed at addressing climate change.
What to watch today:
- Our local market is expected to open lower, down 0.12%, in line with the mixed US session.
- In economic news, both the NAB business confidence for July and the Westpac consumer confidence for August will be released today.
- In company reports, today we’ll hear from Megaport (ASX:MP1), Coronado Global Resources (ASX:CRN), News Corp (ASX:NWS) and REA Group (ASX:REA). Bell Potter forecasts REA’s NPAT to come in at $404 million, while consensus is a bit more modest at $411.2m, and consensus expects CRN’s NPAT to come in at $430m. Keep watch of these stocks today to see if their results are in line with expectations. Keep watch of NAB today as the company will be releasing a third quarter trading update.
- Moving to commodities, oil prices lifted after positive economic data was released out of China. The gold price also gained following a pullback in the US dollar and US Treasury Yields, while the spot iron ore price traded slightly lower at US$112 a tonne.
Trading Ideas:
- Bell Potter have downgraded its rating on OZ Minerals (ASX:OZL) from a Buy to a Hold. Bell Potter views BHP’s proposal to takeover OZ Minerals (ASX:OZL) as offering competitive value but likely to be improved. However, the risk-adjusted potential upside is insufficient for Bell Potter to maintain a Buy rating, therefore the downgrade to a Hold, with a strategy to see through to the completion of an all-cash acquisition of OZL at the current offer price or higher. Bell Potter has made no changes to their earnings forecasts and have increased their price target by 2% to match the current offer price of $25.00 per share.
- Trading Central has a bearish signal on Data3 (ASX:DTL) indicating that the stock price may fall from the close of $6.21 to the range of $4.40 - $4.70 in the next 19 days according to standard principals of technical analysis.
Our local market closed 0.6% higher on Friday, with materials advancing the most as gold miners extended gains, while energy stocks fell alongside a drop in the oil price.
NOVONIX (ASX:NVX) jumped 13.7% and was followed by miners including Liontown Resources (ASX:LTR), Ramelius Resources (ASX:RMS), Silver Lake Resources (ASX:SLR) and Core Lithium (ASX:CXO). Stocks that declined the most on Friday were Megaport (ASX:MP1) and Block (ASX:SQ2).
The most traded stocks by Bell Direct clients on Friday were BHP Group (ASX:BHP), Lake Resources (ASX:LKE) and Whitehaven Coal (ASX:WHC).
European stocks closed lower with the STOXX 600 closing down 0.8%. Most sectors were in negative territory, with tech stocks down the most, falling 2.4%. A strong US jobs report came in in the US, however it wasn’t quite enough to pull markets higher, as the three major benchmarks closed mixed. The labour market added more jobs in July than was expected, and the US unemployment rate dropped to 3.5%, while wage growth rose 5.2% higher than a year ago, signalling that high inflation is still a key concern. The Dow Jones closed just 0.2% higher, while the S&P500 fell 0.2%, and the Nasdaq dropped 0.5%.
What to watch today:
- Following the US, the Australian market is set to open flat this morning.
- OZ Minerals (ASX:OZL) rejected a takeover proposal by BHP for $8.34 billion, undervaluing the gold and copper miner. The offer was made on Friday – it was a $25 per share offer which was a 32% premium to the stock’s last close. So, watch the share price movements of BHP and OZL today.
- Reporting season is picking up this week with quite a few companies releasing their earnings results. This morning, rail freight operator Aurizon Holdings (ASX:AZJ) and Suncorp (ASX:SUN) both published their full year results.
- SUN delivered group NPAT of $681 million, down 34%, impacted by volatile investment markets and elevated natural hazard costs. Home lending was up 9% or $4.1 billion. And SUN announced a final fully franked ordinary dividend of 17 cents per share, representing a 75% payout ratio.
- AZJ’s underlying EBITDA was only 1% lower than the prior comparable period. Cashflow increased 13%, and AZJ announced a final dividend of 10.9 cents per share fully franked.
- In commodities, the price of oil is lower, heading for an over 9% weekly loss and wiping out the gains triggered by Russia’s invasion of Ukraine. Gold is also trading lower as markets react to a strong payroll report in the US. And iron ore continues to drop around worries of China’s ropery crisis and steel production cuts.
Trading Ideas:
- Citi have a Buy rating on City Chic Collective (ASX:CCX) with a price target of $3.00. They see potential for long duration international growth underpinned by market share gains. The expected share price return is 35.7%.
- Trading Central have identified a bullish signal in Resolute Mining (ASX:RSG), indicating that the stock price may rise from the close of $0.30 to the range of $0.34 - $0.35 over 41 days, according to the standard principles of technical analysis.
The Aussie share market lifted 0.4% this week (Mon-Thu), with tech shares outperforming. Reporting season will be in full swing next week, with a number of well-known companies reporting to the ASX.
In this week’s wrap, Sophia covers:
- (0:35) Five external factors that will impact company earnings
- (1:22) Bell Potter and Citi's forecasts for next week's company results
- (2:53) Tech shares soaring after strong US earnings reports
- (4:25) The most traded stocks & ETFs by Bell Direct clients
- (5:08) Three economic news items to watch out for
Yesterday, the Aussie share market started the trading session in negative territory, down about 1% in the morning, but fought back in the afternoon to close 0.3% lower.
The tech sector was the top performing sector, up 2.2%. Materials also managed to post a small gain of 0.35%. However, the rest of the sectors were in the red.
Looking at the ASX200 leaderboard, Pinnacle Investment Management (ASX:PNI) jumped 12.2% after its strong full-year results, which showed profits had grown in financial year 2022. Zip (ASX:ZIP) was up 8.6%, continuing to lift since its quarterly report a couple of weeks ago. And some other tech shares like NOVONIX (ASX:NVX), EML Payments (ASX:EML) and Megaport (ASX:MP1) were amongst the top gainers for the day. On the flip side, the worst performers yesterday included Centuria Industrial REIT (ASX:CIP), Star Entertainment Group (ASX:SGR) and City Chic Collective (ASX:CCX).
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), telehealth company ResApp (ASX:RAP), as well as Zip (ASX:ZIP).
Moving to the US, stocks rallied off the back of better-than-expected economic data and a rebound in tech stocks. The positive July services PMI helped investors shake off worries of a recession and sent traders back to beaten-down tech stocks. The Dow Jones was up more than 400 points, the S&P500 lifted 1.6% and the Nasdaq jumped 2.6%, boosted by solid gains from Apple, Amazon, and Microsoft. European markets also closed higher after the strong US data reported.
What to watch today:
- In line with the positive session seen in the US and in Europe, the ASX200 is expected to rise 0.47% at the open if you go by the SPI futures.
- In economic news, balance of trade data for June will be released. Australia's trade surplus lifted to a record high of $15.97 billion in May 2022, easily beating market forecasts of a surplus of $10.73 billion, as exports rose more than imports, amid solid global demand and soaring commodity prices. Today’s reading is expected to come in at $14 billion, so stay tuned at 11:30am AEST.
- Moving to commodities, oil prices have fallen after a surprise increase in US crude and gasoline inventories weighed on prices. The WTI oil price is trading at around US$90 a barrel. The gold price was pressured by a stronger dollar and Treasury yields and currently trades at US$1,763 an ounce, and the spot iron ore price trades slightly down, at US$117 a tonne.
- If you hold Arena REIT (ASX:ARF), Prospect Resources (ASX:PSC) or Uniti Group (ASX:UWL), you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Technology One (ASX:TNE) with an increased price target from $12.50 to $14.25. Bell Potter forecast double digit underlying EPS growth in each of the next three years. TNE also recently reported a strong result which was generated by an increase in the average number of products per customer, a large number of Software as a Service (SaaS) flips and also CPI increased for those customers in Australia who renewed contracts in the first half of FY22. At its current share price of $12.30, this implies about 16% share price growth in a year.
- Trading Central has a bullish signal on Fletcher Building (ASX:FBU) indicating that the stock price may rise from the close of $4.77 to the range of $5.55 - $5.70 in the next 71 days according to standard principals of technical analysis.
The ASX200 closed just 0.07% in the green, after earnings results from Appen (ASX:APX) and Credit Corp (ASX:CCP) disappointed investors. APX’s shares dropped after reporting a worse half than forecasts, as underlying earnings and revenue fell, while CCP’s shares dropped after reporting “challenging conditions”. Also yesterday, the RBA announced a further 50 basis point rise to the cash rate, now at 1.85%. This was in line with expectations, so we didn’t see any large impacts from the announcement. The market was trading a little lower leading up to the RBA’s announcement at 2:30pm, but then rose in afternoon trade, following the news.
The consumer discretionary sector, consumer staples and tech advanced the most, while real estate and materials declined.
The best performing stock was BNPL company Zip (ASX:ZIP) which gained 15% yesterday, and it was followed by the a2 Milk Company (ASX:A2M) and St Barbara (ASX:SBM). The worst performing stock was United Malt Group (ASX:UMG), after the company downgraded its FY22 guidance.
The most traded stocks by Bell Direct client yesterday were the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ), Whitehaven Coal (ASX:WHC) and Rio Tinto (ASX:RIO).
European shares were in the red, as investors track risk-off sentiment globally and whether last month’s rally has any further to go. Corporate earnings also remained a core driver of individual share price movement with shares such as BP and Ferrari publishing results. The STOXX 600 closed 0.2% lower, with financial services stocks falling 1.7%. Most sectors were in negative territory, however we did see oil and gas stocks gain.
US equities were also lower, for the second day, amid more hawkish commentary from the Federal Reserve. The Dow Jones fell 1.2% or just over 400 points, weighed down by disappointing earnings from Caterpillar. The S&P500 closed 0.7% lower. And the Nasdaq fell 0.2%, however the index did see a 19% jump in Uber shares following its corporate earnings release. Stocks were also reacting to comments made by the Chicago Fed President Charles Evans, who said he hopes the central bank can raise its benchmark interest rate by half a percent. So note, there is no Fed meeting in August – the next Fed interest rate decision will be at the end of September.
What to watch today:
- Following the negative run the US, the Australian market is set to fall 0.16% at the open this morning, going by the SPI futures.
- In commodities, oil is trading lower with continued worries around tight supply, that has more than offset worries over an economic slowdown. Investors are also awaiting OPEC’s meeting, for any indication of a further boost in crude supply. Gold is currently falling, however did see a big jump, hovering at its highest levels in four weeks, as a falling dollar and Treasury yields supported bullion demand. And iron ore is recovering from what was a seven-month low of US$100 a tonne, after news of declining steel inventories in China.
- Watch the share price movements of BWP Trust (ASX:BWP), SSR Mining (ASX:SSR), Pinnacle Investment Management Group (ASX:PNI), and Genworth Mortgage Insurance Australia (ASX:GMA). Those companies will be reporting their earnings results today.
Trading Ideas:
- Bell Potter maintain a Buy rating on United Malt Group (ASX:UMG), after the company downgraded its FY22 guidance. Estimated EBITDA guidance has been downgraded from $115-140 million to $100-108 million, and the main drivers of this are in the processing division, with continued margin pressure from higher barley prices and continued delays in customer shipments. Bell Potter say the export data demonstrated a recovery in malt trade flows from the largest producing regions and a general bottoming in implied malt-barley premiums, and that they view these as precursors to a recovery in earnings. The broker has also relooked at their
The Aussie share market started the new trading week with a gain of 0.7%, supported by gains in utility, energy, and healthcare stocks. While three sectors posted losses: tech, consumer discretionary and real estate.
Looking at the ASX200 leaderboard, the top performer was Allkem (ASX:AKE) up 4.5%, despite any news out from the company. It seems the gain could be attributed to the longer-term uptick spurred by the company’s recent record quarterly revenue report. Agricultural business Elders (ASX:ELD) was also up after Goldman Sachs indicated that the company was a strong buy, with a price target of $21, which at its current share price of $11.75, implies about 80% share price growth in a year. Meanwhile, the biggest decliner was United Malt Group (ASX:UMG), which fell a massive 17.2% after the company cut its guidance for the second time this year.
The most traded stocks by Bell Direct clients yesterday included ANZ (ASX:ANZ), Lake Resources (ASX:LKE) and the Magellan Infrastructure Fund (ASX:MICH).
Moving to the US, equities fell, as investors question whether the recent rally has further to run. All three of the major indexes snapped their three-day winning streaks. The Dow Jones was down close to 50 points, the S&P500 dropped 0.3% and the Nasdaq was down about 0.2%.
What to watch today:
- In line with the negative session in the US and in Europe, the ASX200 is expected to fall 0.3% at the open if you go by the SPI futures.
- In economic news, the RBA will announce its next cash rate decision this afternoon. The central bank is tipped to lift the official cash rate by 50 basis points to 1.85%, and this would mark the third consecutive increase of this magnitude, which has never happened in Australia. Despite last week’s headline inflation coming in less than expected, the door still remains open for a larger-than-expected rate hike as the country’s core inflation reading actually came in higher than the market expected, and this is used as the basis for RBA monetary policy.
- Reporting wise, it’s a light week of results. Today, debt collector, Credit Corp Group (ASX:CCP) and Centuria Office REIT (ASX:COF) will announce their earnings results. And Virgin Money UK (ASX:VUK) will be releasing its Q3 trading update.
- In commodities:
- The gold price nearly hit a one-month high off the back of a weaker US dollar. The gold price is currently trading at around US$1,771 an ounce.
- Oil prices dropped significantly, after weak manufacturing data from China and Europe weighed on the demand outlook. Investors are also bracing for this week’s OPEC meeting on supply. The WTI crude oil price trades at US$94 a barrel.
- The spot iron ore price trades slightly down, at US$117 a tonne.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Janus Henderson (ASX:JHG) with a price target of $43.50 (that’s 4.4% lower than its previous price target of A$45.50). JHG reported worse than expected Q2 results. Bell Potter forecasted assets under management (or AUM) of US$319b, however JHG reported AUM of US$299b, well below Bell Potter’s expectations. Despite the miss, Bell Potter believes JHG is still worth considering given markets should start to recover, JHG has a new direction with its newly appointed CEO and the business is still the prospect of merger and acquisition. At its current share price of $36.78, this implies about 18% share price growth in a year.
- Trading Central has a bullish signal on AMP (ASX:AMP) indicating that the stock price may rise from the close of $1.10 to the range of $1.15 - $1.17 in the next 28 days according to standard principals of technical analysis.
Week-to-date the market is up 2.3%, and up 0.8% in Friday’s session, as real estate, utilities and tech advanced.
Companies have also been reporting their earnings for the June quarter, which has caused a bit of share price movement. On the ASX200, St Barbara Mines (ASX:SBM) gained after reporting a 40% jump in gold production. And EML Payments (ASX:EML) rebounded after a heavy fall earlier in the week, while Zip (ASX:ZIP), BrainChip (ASX:BRN) and PointsBet Holdings (ASX:PBH) declined the most.
The most traded stocks by Bell Direct clients on Friday were BHP Group (ASX:BHP), Treasury Wine Estates (ASX:TWE), Sierra Rutile (ASX:SRX) and Lake Resources (ASX:LKE).
Overseas, European shares actually closed July as their best performing month since November 2020. Recently GDP data also showed that economic growth in the euro zone accelerated in the second quarter, and that’s despite the rising gas prices and high inflation figures. The STOXX 600 jumped 1.3%, with oil and gas stocks in the lead.
US equities also had a positive run, rising for the third straight day. Strong earnings results have been coming in from the major tech names in the US, which has recently overshadowed the concerns that market was having about a recessionary environment and high inflation. The Dow Jones closed 1% higher or more than 300 points, the S&P500 up 1.4% and the Nasdaq up 1.9%.
What to watch today:
- The SPI futures are suggesting the Australian market will rise 0.67% at the open this morning.
- Keep watch of Ramsay Healthcare (ASX:RHC) today, with reports that there’s been progress with the company’s takeover approach by private equity company KKR. Back in April, Ramsay received a non-binding $88 per share offer from KKR.
- Healthcare stocks are also in focus after the World Health Organisation declared Monkeypox as a global health emergency. The disease has so far spread in 74 counties, and therefore shares such as CSL (ASX:CSL), Telix Pharmaceuticals (ASX:TLX) and Clinuvel Pharmaceuticals (ASX:CUV) may be ones to look out for.
- In commodities, oil is trading more than 2% higher on continued reports of tight supply. The gold price also gained after negative GDP data in the US pushed markets to scale back hawkish expectations from the Fed. Meanwhile, iron ore is trading slightly lower, however has been recovering, rising from a seven-month low.
- In economic data, this morning the S&P Global Manufacturing PMI will be released at 9am, and ANZ’s data on job advertisements for July will be released at 11:30am AEST.
- Bayrock Resources (ASX:BAY) as it lists on the ASX today.
Trading Ideas:
- Bell Potter maintain a BUY rating on BCI Minerals (ASX:BCI) after the company reported its June quarter. EBITDA rose to $7.7 million from $3.5 million in March, despite sales volumes dropping 10%. Bell Potter have lowered their price target to $0.50, and at BCI’s current share price of $0.25, this implied 100% share price growth in a year.
- Trading Central have identified a bullish signal in Lake Resources (ASX:LKE) indicating that the stock price may rise from the close of $0.81 to the range of $0.99 to $1.03 over 20 days, according to the standard principles of technical analysis.
The Aussie share market advanced 1.5% this week (Mon-Thu), with the materials sector leading the way. Reporting season also kicked off with some key companies releasing their results.
In this week’s wrap, Sophia covers:
- (0:34) What to consider this reporting season
- (1:20) Rio Tinto's (ASX:RIO) weaker than expected half-year results
- (2:30) BNPL stock, Zip (ASX:ZIP) almost tripling its value this month
- (2:50) The most traded stocks & ETFs by Bell Direct clients
(3:29) Five economic news items to watch out for
Yesterday, our local market posted a modest gain of 0.2%, its second session of gains. While the market started off slowly, it rose in the afternoon after the latest inflation reading, which showed that the price we paid for goods and services over the past year had lifted by 6.1%. That’s the strongest lift we’ve seen in two decades, however it wasn’t as hot as consensus’ expectation of 6.3%. This means in next Tuesday’s RBA meeting, we’re more likely going to see a 0.5% rate hike rather than the 0.75% originally expected.
Looking at the sector performances, six of the 11 sectors ended higher, including healthcare, financials, and consumer discretionary. The gains in these sectors offset the losses we saw in some mining and energy stocks.
The biggest gainer on the ASX200 was once again BNPL stock Zip (ASX:ZIP), which was up 21%. Sezzle (ASX:SZL) also jumped a massive 96%, after no news out from the company. The stock then subsequently finished the day in a trading halt. Other top performer’s included BrainChip (ASX:BRN), Silver Lake Resources (ASX:SLR) and Iress (ASX:IRE). The worst-performing stock was City Chic Collective (ASX:CCX), which closed 5.1% lower, followed by shares in Champion Iron (ASX:CIA) and BlueScope Steel (ASX:BSL).
The most traded stocks by Bell Direct clients yesterday included National Australia Bank (ASX:NAB), Pilbara Minerals (ASX:PLS) and Whitehaven Coal (ASX:WHC).
Moving to the US, equities rallied after the US Fed announced its much anticipated 0.75% rate increase in its efforts to fight inflation, however left the door open about the size of the rate move at its next meeting in September. Investors were also encouraged after the central bank noted that it doesn’t believe the economy is currently in a recession. We saw the Dow Jones close over 400 points higher, the S&P500 up 2.6% and the Nasdaq up 4.1%.
What to watch today:
- In line with the positive session in the US, the ASX200 is expected to rise 0.77% at the open if you go by the SPI futures.
- In economic news, preliminary retail sales for June will be released at 11:30am AEST.
- Reporting wise, Fortescue Metals (ASX:FMG), Mineral Resources (ASX:MIN), Pilbara Minerals (ASX:PLS) and Sandfire Resources (ASX:SFR) will be reporting their quarterly production results. And Ai-Media Technologies (ASX:AIM) and Unibail-Rodamco-Westfield (ASX:URW) will be reporting their earnings results.
- Moving to commodities, oil prices rose over 2%. The gold price reversed its recent losses and traded in the green after the Fed announced its rate hike. And the spot iron ore price trades 5.8% higher at US$110 a tonne.
- Mineral exploration company, Coolabah Metals will be debuting on the ASX today, trading under the ticker code CBH.
- Australian Agricultural Company (ASX:AAC) will be holding its AGM today.
- If you hold Clime Capital (ASX:CAM), Sunland Group (ASX:SDG) or Turners (ASX:TRA) you will receive your dividend payment today.
Trading Ideas:
- Citi have maintained its Buy rating on Rio Tinto (ASX:RIO) with a price target of $120. After market close yesterday, RIO reported weak first half results with an underlying EBITDA of US$15.6b, which was 3% below consensus and 10% lower than Citi’s expectations. The group reported first half 2022 EPS of 533 US cents and an interim dividend of 267 US cents per share, which implies a 50% payout against market expectations of 65-70% payout. Now, at its current share price of $96.98, this implies about 24% share price growth in a year. At its current share price of $96.98, this implies about 24% share price growth in a year.
- Trading Central has a bullish signal on Lake Resources (ASX:LKE) indicating that the stock price may rise from the close of $0.74 to the range of $0.97 - $1.03 in the next 26 days according to standard principals of technical analy
Yesterday, our local market nudged 0.3% higher, reaching a six-week high, with six of the 11 industry sectors posting gains. Energy shares led the way. Meanwhile, consumer discretionary and healthcare shares were the biggest decliners.
Looking at the ASX200 leaderboard, BNPL stock Zip (ASX:ZIP) advanced the most, rising nearly 20%, and closing above $1 for the first time in two months. There was no news out from Zip, so it’s likely investors are still feeling positive about last week’s quarterly update. Another top performer was Paladin Energy (ASX:PDN). Its share price gained 8.1% following the production restart of one of its uranium projects. The worst performers yesterday included Iress (ASX:IRE), Flight Centre (ASX:FLT) and Perseus Mining (ASX:PRU).
The most traded stocks by Bell Direct clients yesterday included National Australia Bank (ASX:NAB), Lake Resources (ASX:LKE) and Zip Co (ASX:ZIP).
Moving to the US, all three benchmarks closed lower. Stocks fell after Walmart cut its earnings forecast because of rising food inflation. This dragged down other retail shares and added concern that consumer spending might not be strong enough to keep the US out of a recession. And on Tuesday, the US Fed began its two-day policy meeting. Investors are widely expecting a three-quarter percentage point hike and will be looking for clues on the future interest rate path.
What to watch today:
- In line with the poor session we saw in the US, the ASX200 is expected to fall 0.54% at the open if you go by the SPI futures.
- The ABS will release its latest inflation figure, also known as the Consumer Price Index. It’s likely to be a dull announcement for investors and households, with the annual reading expected to come in at 6.2%, which will be the highest reading in more than 30 years, leaving the door open for the RBA to continue its aggressive rate hikes.
- IGO (ASX:IGO) and St Barbara Mines (ASX:SBM) will be reporting their quarterly production results. Rio Tinto (ASX:RIO) will be reporting its earnings results after market close today.
- Moving to commodities:
- Natural gas hit its highest level since 2008, and is on pace for its best month as Russia cut supply and as high temperatures around the world stoke demand. So keep watch of ASX gas companies like AGL Energy (ASX:AGL) and Origin Energy (ASX:ORG).
- The oil price fell 1.3% to US$95 a barrel. Gold also came under pressure, trading at US$1,717 an ounce.
- The spot iron ore price trades 1% higher at US$104 a tonne.
- Iluka Resources’ demerger, Sierra Rutile, will be debuting as its own ASX-listed company today under the ticker code SRX on a deferred settlement basis.
- Kelly Partners Group (ASX:KPG) and Mirrabooka Investments (ASX:MIR) are set to go ex-dividend today. And lastly if you hold Premier Investments (ASX:PMV) you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Perpetual (ASX:PPT) however with a reduced price target from $42 to $38.40. At its current share price of $28.97, this implies about 33% share price growth in a year.
- Trading Central has a bullish signal on Allkem (ASX:AKE) indicating that the stock price may rise from the close of $10.45 to the range of $12.60 - $13.20 in the next 37 days according to standard principals of technical analysis.
Yesterday the market closed completely flat, however we did see materials and utilities gain over 1%. An uptick in iron ore, nickel, aluminium and zinc helped boost some mining stocks higher, while tech shares declined.
Leading the tech losses was EML Payments (ASX:EML), which fell more than 22%, after reporting that its facing some challenges regarding its remediation programme and their dealings with the Central Bank of Ireland. Meanwhile, stocks that gained were Insurance Australia Group (ASX:IAG), Steadfast (ASX:SDF), and Evolution Mining (ASX:EVN). Travel shares also advanced after Flight Centre (ASX:FLT) reported a “solid rebound in travel” and flagged a return to profitability in the next three months.
The most traded stocks by Bell Direct clients were Treasury Wine Estates (ASX:TWE), Ioupay (ASX:IOU), and News Corporation (ASX:NWS).
Over in New York, in afternoon trade US shares were lower as investors are trading cautiously ahead of the Fed’s meeting this week, as well as earnings results that are set to be released from a few of the large-cap growth companies. However, the Dow Jones closed 0.3% higher, the S&P 500 slightly rose 0.1%, while the Nasdaq fell 0.4%. Corporate earnings in the US are expected to pick up this week with some major tech names set to report. These include Apple, Meta, Microsoft and Amazon.
What to watch today:
- The SPI futures are suggesting our market will rise 0.36% or 22 points at the open this morning.
- In commodities, oil is trading higher after what was three consecutive sessions of losses. The gold price however is trading down, while iron ore prices are up.
- Today watch the share price movements of Perseus Mining (ASX:PRU) and Regis Resources (ASX:RRL). Both companies are set to release their quarterly production reports today.
Trading Ideas:
- Bell Potter maintain their Buy rating on Mineral Resources (ASX:MIN). The company has a growing portfolio of mining services and commodities businesses. Bell Potter have increased their price target on Mineral Resources from $70 to $75, and at its current share price of $46.82, this implies 60.2% share price growth in a year.
Trading Central have identified a bullish signal in James Hardie Industries (ASX:JHX) indicating that the stock price may rise from the close of $35.34 to the range of $42.25 to $44 over 50 days, according to the standard principles of technical analysis.
Our local market closed flat on Friday, however, did deliver its best week since March. On Friday, real estate and financials gained the most. All four major banks closed higher, and tech stocks also rallied.
Leading the market was Pointsbet Holdings (ASX:PBH), Zip Co (ASX:ZIP) and EML Payments (ASX:EML), while the worst performers were Coronado Global Resources (ASX:CRN), Paladin Energy (ASX:PDN) and Webjet (ASX:WEB)
The most traded stocks by Bell Direct clients on Friday were ANZ (ASX:ANZ) and National Australia Bank (ASX:NAB).
European shares gained after the European Central Bank on Thursday announced a 50-basis point hike to interest rates, as expected, its first hike in 11 years. The STOXX 600 closed 0.4% higher, with travel and leisure stocks performing best.
In the US, all three major benchmarks declined. The Dow Jones closed 0.4% lower, the S&P500 fell 0.9% however did finish the week higher, while the Nasdaq dropped 1.9%. The Nasdaq’s previous rally was halted by an earnings miss from Snap, which sent share falling 39% lower. The yield on the US 10-year note declined 12 basis points to 2.76%.
What to watch today:
- The Australian share market is set to open lower, with the SPI futures suggesting a 0.18% fall at the open this morning.
- In commodities, oil extended losses for a third session, trading just below US$95 per barrel, amid continuing concerns of a US recession, as well as weakening gasoline demand with the rate hikes triggering slowdown concerns. On the other hand, gold is trading in the green, rebounding from a 16-month low. And iron ore is trading slightly higher, at levels last seen in December.
- Today watch mining company South32 (ASX:S32) as its set to release a quarterly update today.
- In economic data, this week investor focus will be on the Federal Reserves rate decision early Thursday AEST, as well as the Australian inflation rate for Q2 out on Wednesday. Commonwealth bank economists expect inflation to rise by 1.9% in the quarter, for an annual rate of 6.2%.
Trading Ideas:
- Bell Potter maintain their BUY rating on Coronado Global Resources (ASX:CRN), following the companies June quarter update. Bell Potter expect CRN to generate strong free cash flow on their met coal price outlook. And while they expect global economic factors may see some short-term weakness in met coal markets, longer term supply-demand fundamentals do remain strong. Bell Potter have lowered their price target from $2.15 to $1.95, and at its current share price of $1.47, this implies 32.7% share price growth in a year.
- Trading Central have identified a bullish signal in Lendlease Group (ASX:LLC) indicating that the stock price may rise from the close of $9.87 to the range of $10.55 to $10.75 over 29 days, according to the standard principles of technical analysis.
The Aussie share market rallied 3% this week (Mon-Thu), with almost all industry sectors in the green. Tech shares advanced the most after the US government passed a bill that will provide $50 billion in subsidies for computer chip manufacturing.
In this week’s wrap, Sophia covers:
- (0:16) Reporting season kicking off next week
- (1:14) How inflation impacts the gold price
- (2:20) Five tech stocks that outperformed
- (3:30) The most traded stocks & ETFs by Bell Direct clients
- (4:05) Three economic news items to watch out for
Yesterday, our local market advanced 1.7%, its best gain in around three weeks, again supported by a strong session in the US on Tuesday, after profit results from some well-known companies came in better than expected.
We also heard from RBA Governor Phillip Lowe, who said he expected the RBA to lift the cash rate to 2.5%, but whether that eventuates, as well as how quickly that may happen “will be determined by the inflation outlook”, with the next inflation update due out next Wednesday.
Sectors wise, all eleven industry sectors were in the green. The best performing sector was tech, followed by materials and real estate.
Megaport (ASX:MP1) was the biggest gainer, up 23% yesterday, following it delivering EBITDA profit in the fourth quarter, a first for the company. Paladin Energy (ASX:PDN) lifted 10.5%, after its management decided to restart one of its mines due to strong uranium market fundamentals. On the flip side, the biggest decliners yesterday were NIB Holdings (ASX:NIB), Pendal Group (ASX:PDL) and Perseus Mining (ASX:PRU).
The most traded stocks by Bell Direct clients yesterday included Sims (ASX:SGM), the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ) and BHP Group (ASX:BHP).
Moving to the US, all three benchmarks closed higher, boosted by a tech rally. Streaming giant Netflix surged after it reported it had lost 970,000 subscribers in the second quarter, which was less than the 2 million it had previously projected. Investors had been awaiting this earnings season for an indication on how companies are coping with the worst inflation in more than 40 years. So far, 12% of S&P500 companies have reported earnings, with 68% beating analyst expectations.
What to watch today:
- The Australian share market is expected to fall 0.46% at the open if you go by the SPI futures, despite another solid session on Wall Street.
- Watch ANZ (ASX:ANZ) today as it is expected to return from its trading halt after its recent announcement to acquire Suncorp’s (ASX:SUN) banking division for $4.9 billion.
- Companies reporting today include Evolution Mining (ASX:EVN), Newcrest Mining (ASX:NCM), Santos (ASX:STO), Syrah Resources (ASX:SYR), Woodside Energy (ASX:WDS) and BNPL stock Zip (ASX:ZIP).
- Moving to commodities, softening US gasoline demand weighed on prices. The WTI Crude oil price declined about 2% to $US102 a barrel and the Brent price fell to US$106 a barrel. The gold price also came under pressure, following improving risk sentiment and a strong US dollar putting pressure on the safe haven asset, and the spot iron ore price trades flat at US$101 a tonne.
- If you hold Magellan Global Fund (ASX:MGF) or GrainCorp (ASX:GNC), you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Beach Energy (ASX:BPT) with an increased price target from $2 to $2.40. BPT reported better than expected quarterly revenue of $504m, materially exceeding Bell Potter’s expectation of $430m. Bell Potter believe the business has a strong, fully funded energy production growth outlook and highlighted that BPT is trading at lower earnings multiples compared with its ASX-listed peers. At its current share price of $1.82, this implies about 32% share price growth in a year.
Trading Central has a bullish signal on BrainChip (ASX:BRN) indicating that the stock price may rise from the close of $1.13 to the range of $1.24 - $1.28 in the next 30 days according to standard principals of technical analysis.
Our local market closed 0.6% lower yesterday, partly due to comments made by the RBA’s deputy governor, who stated that the official interest rate will move “a fair bit higher than where we currently are.” This put pressure on tech shares, which are interest rate sensitive. They declined 3%. And only two of the 11 industry sectors gained: energy was the best performer, up 2.5% and utilities gained 1%.
While Xero (ASX:XRO) and EML Payments (ASX:EML) declined with the broader tech sector, the top performers on the ASX200 were Lake Resources (ASX:LKE), Pendal Group (ASX:PDL) and Whitehaven Coal (ASX:WHC).
WHC was also the most traded stock by Bell Direct clients. Its share price closed 5.5% higher, following its Q4 update where the company reported that it expects to deliver an EBITDA worth $3 billion for the 2022 financial year. And WHC reported a strong quarter off the back of record coal prices. A number of brokers yesterday released positive reports on the coal miner as well. Bell Potter rate WHC a Buy. Citi upgraded WHC from Neutral to Buy. Morgans have an Add rating and Macquarie and Credit Suisse have an Outperform rating. So, brokers are optimistic on WHC at the moment. Its current share price is $6.21, and broker price targets range from $6.70 by Morgans, to $7.85 by Citi.
Overseas, European stocks rallied with earnings season kicking off, and positive momentum from Wall Street. The STOXX 600 index closed with a gain of 1.4%, and this week investors will be waiting for the European Central Bank’s policy meeting on Thursday in Frankfurt, as policymakers have given advance notice of the first-rate hike in 11 years.
US equities saw a strong session overnight. The Dow Jones gained more than 750 points, up 2.4%, the S&P500 gained 2.8% and the tech-heavy Nasdaq closed with a 3.1% gain. This is off the back of strong corporate earnings reports coming in, bringing all three major averages above their 50-day moving averages for the first time since April.
What to watch today:
- The Australian market is set to open higher, with the SPI futures suggesting a rise of 1.21% at the open this morning.
- In commodities,
- The price of oil is trading 2.5% lower currently, around US$100 per barrel, with reports that in at least the near term, it’s unlikely that supply gaps will be filled by additional output from OPEC. This is despite efforts from the US government to bring more oil to markets, in the aim of taming energy costs.
- The price of gold is trading slightly higher, however remains close to its lowest levels in almost a year, with the constant pressure of US monetary tightening.
- Seaborne iron ore has dropped 2%.
- Coal is trading higher. China is the world’s largest coal consumer and they’ve announced that they may lift an almost two-year ban on Australian coal. So, keep watch of coal stocks today.
- A few companies are set to release their quarterly reports, so keep watch of their share price movements today as well. These include 29Metals (ASX:29M), Allkem (ASX:AKE), Atlas Arteria Group (ASX:ALX), Beach Energy (ASX:BPT), Cooper Energy (ASX:COE), Northern Star Resources (ASX:NST), Perseus Mining (ASX:PRU) and Megaport (ASX:MP1).
- BHP released its quarterly report yesterday, and its production for copper and iron ore was in line with guidance. Following the report, Goldman Sachs reiterated its Buy rating, but trimmed their price target to $40.80. Macquarie, however, have a $50 price target, with an Outperform rating.
Trading Ideas:
- Bell Potter maintain their Buy rating on Alkane Resources (ASX:ALK), as its June quarter update saw several important business development milestones. Bell Potter’s price target is $1.30, and at ALK’s current share price of $0.72, this implies 81.8% share price growth in a year.
- Trading Central have identified a bearish signal in ResMed (ASX:RMD), indicating t
Our local market started the new trading week with a gain of 1.2%, supported by a strong session on Wall Street and in Europe on Friday.
Sectors wise, tech stocks led the day’s gains. Energy stocks also performed well after Brent oil prices jumped on Friday. Financials climbed about 1.4%, with three of the big four banks rising. Meanwhile, the healthcare sector dropped 0.5%.
The best and worst ASX200 performers: BrainChip (ASX:BRN) surged 13.9%, following strong gains on the Nasdaq on Friday. BRN was not alone, other tech stocks also lifted, like Life360 (ASX:360), NOVONIX (ASX:NVX) and WiseTech Global (ASX:WTC). Building materials supplier, Boral (ASX:BLD) closed in the green also, up 6.2%. On the flip side, the worst performers included a2 Milk (ASX:A2M), Fisher & Paykel Healthcare (ASX:FPH) and Endeavour Group (ASX:EDV).
The most traded stocks by Bell Direct clients yesterday included Sims (ASX:SGM), PayGroup (ASX:PYG), the BetaShares Australian Strong Bear Hedge Fund (ASX:BBOZ) and Whitehaven Coal (ASX:WHC).
Moving to the US, all three benchmarks closed lower following a late selloff that wiped out some strong intraday gains. The Dow closed 200 points lower and the S&P500 and Nasdaq both declined 0.8%.
What to watch today:
- Following the negative session in the US, the SPI futures are suggesting that our market will open 0.32% lower.
- Keep an eye on ANZ (ASX:ANZ) and Suncorp (ASX:SUN), after Suncorp accepted a $4.9 billion bid from ANZ to take over its banking business. ANZ is currently in a trading halt while it goes to its shareholders to raise $3.5 billion in additional funds to pay for the deal. This isn’t expected to be completed for at least 12 months as it requires a number of regulatory approvals.
- In economic news, today sees the release of the minutes from June’s monetary policy meeting held by the RBA.
- There are a number of Australian commodity companies reporting their Q4 results this week, including lithium player, Allkem (ASX:AKE) and oil companies Beach Energy (ASX:BPT) and Woodside Energy (ASX:WDS). Today, we’ll hear from the largest company on the ASX, BHP Group (ASX:BHP).
- Other companies reporting today include HUB24 (ASX:HUB) and Ampol (ASX:ALD).
- In commodities, oil prices lifted, boosted by growing concerns over gas supply from Russia and a lower dollar. The gold price firmed, as the pullback in the dollar helped bullion recover some of its recent losses. The spot iron ore price trades 4.3% lower at US100 a tonne.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Whitehaven Coal (ASX:WHC). WHC reported unaudited financial year 2022 EBITDA of $3b and year end net cash of $1b, which Bell Potter highlighted was an outstanding result. The better than expected result was driven by record thermal coal prices and strong price realisation. Yesterday, WHC rose 5.6% off the back of these strong results.
Trading Central has a bullish signal on investment advice company, Praemium (ASX:PPS) indicating that the stock price may rise from the close of $0.68 to the range of $0.87 - $0.91 in the next 53 days according to standard principals of technical analysis.
The Australian market is down 1% week-to-date and closed 0.7% lower on Friday, weighed down by the materials sector. Materials dropped more than 3% on Friday and just over 6% in the week. This was mostly driven by a pullback in iron ore prices, with concerns about weak demand from China, with recurring COVID-19 outbreaks, as well as low profitability at Chinese steel mills. On top of this, there are also concerns over the Chinese property market and banking sectors, so these reports pushed iron ore prices into a bear market, and overshadowed reports of large stimulus packages in China. Rio Tinto (ASX:RIO)’s share price dropped on Friday with the fall in iron ore and the release of its quarterly update. The miner provided a bearish outlook, describing some difficulties facing China’s recovery from the pandemic lockdowns, as well as the impacts of the Fed’s rate hikes on demand. Goldman Sachs retain their Buy rating on RIO, so keep watch of its share price today. The broker says its share price could be great value and have slightly trimmed their price target to $124.10.
Materials stocks fell across the board on Friday, however the worst performer was investment manager Pendal (ASX:PDL) after the group reported worse-than-expected outflows in the June quarter from its managed funds.
The most traded stocks by Bell Direct clients on Friday were Whitehaven Coal (ASX:WHC), Rio, Mineral Resources (ASX:MIN) and BHP.
China’s GDP growth missed expectations in the second quarter, sending Chinese markets lower. Despite this, European markets gained, with the Stoxx-600 up 1.8% by the close. And in New York, US equities rallied, following a round of major banks reporting their earnings results. The Dow Jones gained more than 600 points or 2.2%, the S&P500 up 1.9% and the Nasdaq gained 1.8%.
What to watch today:
- The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.88% at the open this morning.
- Keep watch of ANZ’s share price movements today, with reports that ANZ will acquire accounting software MYOB, as well as interest in acquiring Suncorp Group (ASX:SUN). A capital raising to fund the deal is expected to be announced this morning.
- In commodities, oil is trading 2% higher, so look out for energy producers such as Woodside Energy (ASX:WDS). Gold has fallen slightly, while iron ore is currently trading 4% lower. So also watch the major mining stocks today.
Trading Ideas:
- Citi have released their latest research report on the major banks: They rate ANZ Bank as a Buy with a price target of $30.75, while Commonwealth Bank (ASX:CBA) they rate as a Sell, with a price target of $90.75. Citi rate NAB as Neutral with a price target of $32.25, and they rate Westpac (ASX:WBC) as a Buy with a $29 price target.
- Trading Central have identified a bullish signal in Steadfast (ASX:SDF) indicating that the stock price may rise from the close of $5.10 to the range of $5.55 to $5.65 over 14 days, according to the standard principles of technical analysis.
The Aussie share market declined 0.4% this week (Mon-Thu). Australia's unemployment rate for June dropped to 3.5%, which was well below the 3.8% expected, as the economy continues to recover from the pandemic.
In this week’s wrap, Sophia covers:
- (0:14) The market's reaction to the latest US inflation reading
- (2:57) Coal stocks outperforming this week
- (3:35) Why BNPL stock Sezzle (ASX:SZL) fell 57%
- (3:57) The most traded stocks & ETFs by Bell Direct clients
- (4:30) Two economic news items to watch out for
Our local market ended yesterday’s session higher, rising 0.2% despite mining and energy stocks coming under pressure off the back of subdued commodity and metal prices.
Sectors wise, the majority of the market posted gains, with the consumer discretionary, tech and communication services sectors advancing the most. While the energy sector declined 1.8%.
As for the best and worst ASX200 performers, Megaport (ASX:MP1) was up the most, following a rebound in the tech sector, as well as a bullish broker note out of Goldman Sachs. The broker reiterated its buy rating with a $9 price target. MP1’s last closing price was $6.60, so this implies about 36% share price growth in a year. Qantas’ (ASX:QAN) shares also took off yesterday, lifting 4.3%. This comes as the airline announced it is removing vaccine mandates for international travellers commencing next week and following the drop in oil prices recently which has potentially eased the pressure on jet fuel costs. Now, on the flip side, major oil producer, Woodside Energy (ASX:WDS) saw a drop in its share price, off the back of the fall in oil prices, and other decliners yesterday included Viva Energy Group (ASX:VEA) and Alumina (ASX:AWC).
The most traded stocks by Bell Direct clients yesterday included Whitehaven Coal (ASX:WHC), Rio Tinto (ASX:RIO) and BHP Group (ASX:BHP).
Moving to the US, stocks fell after US inflation came in hotter than expected. The consumer price index increased 9.1% from a year ago during the month of June. This was above the 8.8% expected. So, this inflation reading could push the Federal Reserve into an even more aggressive position at its next meeting later this month. So as for the major benchmarks, the Dow shed 200 points, the S&P500 fell 0.5%, and the Nasdaq was down 0.2%.
What to watch today:
- The SPI futures are suggesting our market will open slightly lower, down 0.06%.
- The unemployment rate for June will be released today at 11:30am AEST. It is estimated that 35,000 jobs were added to the local economy last month, which is potentially enough to see the unemployment rate ease to a low of 3.8%. This depends however on the workforce participation rate, which is expected to drop to 66.5%.
- In commodities, oil prices edged slightly higher after their recent sell-off. The gold price rebounded as the US dollar retreated. And the spot iron ore price trades 4% lower at US107 a tonne.
- Watch Auckland International Airport (ASX:AIA) and Netwealth Group (ASX:NWL) today. AIA will be giving an update on its monthly traffic, while NWL will be providing a June quarter update.
- Botala Energy will be debuting on the ASX today. It’s an Australian energy company focused on exploration and development opportunities for natural gas and renewables in Botswana, and it will be trading under the ticker code BTE.
Trading Ideas:
- Bell Potter have maintained its Hold rating on Bega Cheese (ASX:BGA) with a reduced price target from $4.20 to $3.80. At its current share price of $3.55 this implies 7% share price growth in a year.
Trading Central has a bearish signal on Origin Energy (ASX:ORG), indicating that the stock price may fall from the close of $5.45 to the range of $3.50 - $3.90 in the next 146 days according to standard principals of technical analysis.
The Australian market edged higher yesterday, quickly brushing off the weak lead from Wall Street. Materials shares declined the most, as commodity prices fell, while coincidentally the US dollar index rose to the highest level in 20 years, and the US dollar index is a measure against six currency counterparts. The fall in commodities also dragged the Australian dollar down to a two-year low.
Buy-now-pay-later company Zip (ASX:ZIP) has mutually agreed to cancel its proposed merger with Sezzle, another BNPL stock. This announcement saw Zip gain 6% and was the best performing stock on the ASX200, while Sezzle (ASX:SZL) crashed 39% in yesterday’s session, and was the worst performing stock on the All Ords. Zip will be paying Sezzle $US11 million (AUD$16.4 million) for compensation costs.
The most traded stocks by Bell Direct clients yesterday were Westpac (ASX:WBC), Whitehaven Coal (ASX:WHC) and BHP Group (ASX:BHP).
European stocks were boosted by luxury and travel stocks. The STOXX 600 closed 0.5% higher, after having opened lower. US equities were lower however, ahead of June’s inflation report. The Dow Jones closed 0.6% lower, the S&P500 down 0.9% and the Nasdaq down 1%. The latest US Consumer Price Index data is scheduled to be released at 10:30pm AEST (Wednesday morning in the US). It’s expected to rise by 8.8% in June on a year-over-year basis. The last reading in May was 8.6%, and that was the largest increase the US had seen in CPI since 1981. Also, in the US reporting season for the second quarter has begun. The major banks are set to report this week: JP Moran and Morgan Stanley will post results on Thursday before the bell. And the yield on the US 10-year note fell 2 basis points in New York.
What to watch today:
- The Australian market is set to open flat this morning, as uncertainty continues across global markets.
- While investors are waiting on US CPI out later tonight, the Reserve Bank of New Zealand is also expected to list its key rate later today.
- Mining company, South32 (ASX:S32) has announced the sale of four non-core base metals royalties to a company called Anglo Pacific Group. These are royalties from third party interest in copper and nickel projects.
- In commodities,
- Oil has heavily dropped, trading over 8% lower around US$95 per barrel and nearing three-month lows. There is little confidence in oil markets currently, amid a continuously poorer demand outlook. There have also been renewed COVID-19 restrictions in China, which of course is a top importer, and this news has also added to expectations of lower demand for energy as central banks look to accelerate monetary tightening.
- The gold price is hovering near its lowest level in nine months, while iron ore has been dragged down to its lowest levels since January.
- So, watch the share prices of miners and energy producers today, as they’re likely to start the session lower.
- Link Administration (ASX:LNK) holds its AGM today.
Trading Ideas:
- Bell Potter maintain their Buy rating on Envirosuite (ASX:EVS), which is a global provider of environmental management software. They have lowered their price target from $0.25 to $0.23, and at its current share price of $0.16, this implies 43.8% share price growth in a year.
Trading Central have identified a bearish signal in Harvey Norman (ASX:HVN), indicating that the stock price may fall from the close of $3.85 to the range of $3.36 to $3.46, over 17 days according to the standard principles of technical analysis.
Our local market started the new trading week with a loss of 1.1%, with the majority of the industry sectors in the red. The materials and tech sector felt the most pressure, as investors braced for a US inflation reading, as well as domestic jobs update later this week.
Looking at the ASX200 leaderboard, EML Payments (ASX:EML) fell a massive 25% after its chief executive Tom Cregan exiting the fintech group with no explanation. NOVONIX (ASX:NVX), Costa Group Holdings (ASX:CGC) and Domino’s Pizza (ASX:DMP), were all hit with bearish broker notes, while lithium company Lake Resources (ASX:LKE) plunged 6.3%, following revelations that the stock is now being heavily shorted off the back of its CEO’s resignation last month and pessimistic projections for lithium demand. On the flip side, the best performers yesterday included New Hope Corporation (ASX:NHC), Imugene (ASX:IMU) and Suncorp Group (ASX:SUN).
The most traded stocks by Bell Direct clients yesterday, there were multiple financial stocks like three of the big four banks, as well as Bank of Queensland (ASX:BOQ), and mining stocks like BHP Group (ASX:BHP) and Allkem (ASX:AKE).
In the US, equities fell on Monday as investors prepare for big company earnings reports and US economic data, including consumer prices, retail sales and factory output due out later in the week, which will give an indication of the extent to which inflation has peaked, as well as how inflation is impacting businesses. The Dow Jones shed 165 points, the S&P500 fell 1%, while the Nasdaq broke its five-day winning streak, down 2.3%
What to watch today:
- Despite Wall Street losing some ground overnight, the SPI futures are suggesting our market is set to open 0.28% higher.
- Economic news wise, we’ll get an update on business confidence for June, which slowed to 6 points in May, down from 10 previously. If the confidence indicators underperform today, we could see the Aussie dollar respond with losses.
- Moving to commodities, oil prices pulled back overnight, following concerns about rising COVID cases in China. The gold price also came under pressure, off the back of a stronger US dollar. And the spot iron ore price trades at US115 a tonne.
- Stocks going ex-dividend today include Metcash (ASX:MTS) and Sunland Group (ASX:SDG), which will likely cause these stocks to trade lower today as investors take their profits.
Trading Ideas:
- Bell Potter have transferred analyst coverage on EROAD (ASX:ERD). The rating on the stock has been maintained as a Buy however with a reduced price target, from $3.40 to $2.75. Bell Potter remain positive on the company and its outlook. At its current share price of $2.00, this implies 37.5% share price growth in a year.
- Trading Central has a bearish signal on AGL Energy (ASX:AGL), indicating that the stock price may fall from the close of $8.26 to the range of $7.60 - $7.75 in the next 16 days according to standard principals of technical analysis.
Our local market rebounded last week, gaining 2% week-to-date. Most sectors gained WTD, apart from industrials and materials. And taking a quick look at Friday’s session, a rebound in commodities boosted Australian shares and the market closed 0.5% higher, with energy and materials in the lead. Australian shares were largely unaffected by the declines in share markets across Asia on Friday afternoon, following reports that the former Japanese Prime Minister was shot during an election speech.
Instead, energy producers and gold miners gained, as well as the tech sector which followed a strong lead by the Nasdaq. The ASX200 was once again led by family app Life360 (ASX:360).
The most traded stocks by Bell Direct clients on Friday were Worley (ASX:WOR), BHP Group (ASX:BHP), Wesfarmers (ASX:WES) and Mineral Resources (ASX:MIN).
European stocks closed with solid gains, ending the week in positive territory. The STOXX 600 closed the day 0.5% higher, with most sectors in the green. Investor focus was on the US employment report for June, which displayed a stronger than expected month of hiring. It was a key piece of data, as the Federal Reserve is closely watching the labour market and inflation figures as it continues to plan its course for monetary policy.
US equities closed mixed. The Dow Jones closed slightly lower, down 0.2%, while the S&P500 closed flat. Meanwhile, the tech-heavy Nasdaq slightly rose 0.1%, its fifth straight day of gains.
What to watch today:
- The Australian market is set to open higher, with the SPI futures suggesting a 0.3% rise at the open this morning.
- Keep watch of Woolworths (ASX:WOW) after Goldman Sachs this morning added the stock to its conviction list, which is a list of stocks they expect to outperform. The broker also reiterated its Buy rating with a price target of $40.50.
- In commodities, oil prices are trading lower, while gold and iron ore are in the green.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating onChalice Mining (ASX:CHN) with a valuation of $11.10. At its current share price of $4.01, this implies 177% share price growth in a year. Meanwhile, Macquarie have an Outperform rating on the gold miner and have retained their $7.30 price target.
- Trading Central have identified a bullish signal in Allkem (ASX:AKE) indicating that the stock price may rise from the close of $10.46 to the range of $12.70 to $13.20 over 25 days according to the standard principles of technical analysis.
The Aussie share market has advanced 1.7% so far this new financial year (Mon-Thu), accelerating after the cash rate was raised to 1.35%.
In this week’s wrap, Sophia covers:
- (0:59) Why commodity prices have tumbled
- (1:47) Attractive tech stocks in the current market environment
- (2:22) Bell Potter's FY23 stock picks across five sectors
- (4:39) The most traded stocks & ETFs by Bell Direct clients
- (5:19) Three economic news items to watch out for
Yesterday our local market closed in the red for the first time this week, declining 0.5%, off the back of renewed worries about a global recession. This led to a sharp fall in the Aussie dollar, commodity prices and global markets.
Mining and energy stocks suffered heavy losses, with both sectors sinking more than 5%, offsetting the gains seen across most other sectors, like real estate and tech.
Looking at the ASX200 leaderboard, many of the winners were tech stocks, following the strong lead from the US Nasdaq. Stocks like Megaport (ASX:MP1), Life360 (ASX:360), Zip (ASX:ZIP) and EML Payments (ASX:EML), were all up more than 10%. On the flip side, the ten biggest decliners were all from the materials sector, led by gold miner St Barbara (ASX:SBM), which was down 9.5%, along with stocks like Rio Tinto (ASX:RIO) and Woodside Energy (ASX:WDS).
The most traded stocks by Bell Direct clients yesterday were BHP Group (ASX:BHP), the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR) and Woodside Energy (ASX:WDS).
In the US, stocks pushed slightly higher following the latest minutes from the US Federal Reserve, which reiterated the central bank’s commitment to bringing down inflation. Energy stocks were some of the worst performers on the day, as oil prices continued their recent slide.
What to watch today:
- Following the positive session in the US, our local market is set to open 0.5% higher if you go by the SPI futures.
- Economic news wise, balance of trade data for May will be released at 11:30am AEST. That’s the difference between what we export vs. what we import, and consensus expects May’s reading to come in higher at $10.725b.
- Keep watch of payments company, Block (ASX:SQ2) after its US listed shares dropped into the red overnight.
- In commodities, oil prices have continued to slide, falling below US$100 a barrel. Gold is trading lower, down 1.5% to US$1,739 an ounce. And the spot iron ore price trades at US114 a tonne.
Trading Ideas:
- Citi have retained its Buy rating on Lovisa Holdings (ASX:LOV), with a price target of $20.40. At its current share price of $15.46, this implies 32% share price growth in a year.
- Trading Central has a bearish signal on engineering services company, Worley (ASX:WOR) indicating that the stock price may fall from the close of $13.62 to the range of $11.10 - $11.60 in the next 19 days according to standard principals of technical analysis.
Yesterday the RBA’s rate hike was in line with expectations, which saw the share market slightly accelerate. The cash rate was raised by 0.5% or 50 basis points to 1.35%. It was the third consecutive increase, with the central bank taking an aggressive approach to taming inflation. Remember, higher interest rates make it more expensive to borrow money, and this takes some of the pressure off rising prices by discouraging spending. And while there are a few global factors contributing, there are also domestic factors contributing to inflation, such as the recent floods, the increasing number of job vacancies and strong spending.
The local market still managed to close in the green yesterday. The tech sector performed well, and this is an industry usually quite sensitive to interest rates. Real estate was the worst performing sector, which has been the case the last few rate hikes.
As for the major banks, Commonwealth Bank (ASX:CBA), National Australia Bank (ASX:NAB) and Australia & New Zealand Banking Group (ASX:ANZ) all closed slightly lower, while Westpac (ASX:WBC) closed flat. And energy outperformed as oil prices increased, before falling overnight.
Family app Life360 (ASX:360) advanced along with the broader tech sector yesterday. Bell Potter continue to maintain their Buy rating on the stock and have a $7.50 price target. 360’s current share price is $3.24. And gold miners also advanced yesterday. Regis Resources (ASX:RRL) gained after reporting record gold production in the June quarter, and other gold stocks followed its advance, including St Barbara (ASX:SBM) and De Grey Mining (ASX:DEG).
The most traded stocks by Bell Direct clients yesterday were BHP Group (ASX:BHP), CSL Limited (ASX:CSL) and the Vanguard Australian Shares ETF (ASX:VAS).
Overseas, Europeans shares were in the red in the lead up to the European Central Bank’s meeting on Thursday. The STOXX 600 closed 2% lower, with oil and gas stocks falling more than 6%. And the Euro also dropped to its lowest level in two decades on Tuesday. US equities were mixed. The Dow Jones closed slightly lower down 0.4%, the S&P500 gained 0.2%, while the Nasdaq rallied 1.8% higher.
What to watch today:
- The SPI futures are suggesting the Australian market will drop 0.98% at the open this morning.
- In commodities:
- Oil is trading more than 7% lower, as concerns of a US recession continue. Norwegian offshore workers were striking on Tuesday, and this is expected to cut around 130,000 barrels or 6.5% of the country’s daily oil production. Elsewhere, OPEC is also struggling with capacity limits.
- Gold is trading lower, with expectations of more aggressive monetary tightening by the Federal Reserve than previously expected.
- Iron ore prices are in the red with a weak demand outlook as steel mills cut production.
- Copper has also sunk 5%, so watch BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO).
- Graincorp (ASX:GNC) is set to go ex-dividend today, so the stock is likely to be trading lower as investors take their profits.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on EBR Systems (ASX:EBR) and have lowered their price target from $1.28 to $0.90. At its current share price of $0.49, this implies 81.8% share price growth in a year.
- Trading Central have identified a bullish signal in Life360 (ASX:360) indicating that the stock price may rise from the close of $3.24 to the range of $3.75 to $3.95 over 25 days, according to the standard principles of technical analysis.
Yesterday, our local market started the new trading week with an impressive gain of 1.1%, with all eleven industry sectors closing in the green. The energy sector posted the largest gains, up 2.6%, closed followed by the real estate sector and consumer discretionary sectors, which were both up around 2% each.
Looking at the ASX200 leaderboard, one of the best performers was Imugene (ASX:IMU), which lifted nearly 13% yesterday. Also performing well was coal producer New Hope Corporation (ASX:NHC) and real estate investment trust, Ingenia Communities (ASX:INA). Meanwhile, Magellan Financial Group (ASX:MFG) came under pressure, sinking 10% after its co-founder and former Chief Investment Officer, Hamish Douglass had been offloading a significant quantity of his shares in MMG.
The most traded stocks by Bell Direct clients yesterday were the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR), BHP Group (ASX:BHP) and the Vanguard Australian Shares ETF (ASX:VAS).
Wall Street was closed for the Independence Day holiday but in Europe the DAX fell 0.3% and the FTSE rose 0.9%, and US futures are pointing to declines tonight.
What to watch today:
- The Australian share market is set to open flat, going by the SPI futures.
- Economic news wise, for the third month in a row, the RBA is all but certain to lift interest rates, with the majority of economists believing a 50 basis point increase is locked in, which would take the official cash rate to 1.35%. Stay tuned for this announcement at 2:30pm AEST.
- Moving to commodities, the WTI crude oil price is trading 2% higher at US$110 a barrel, as supply concerns boosted prices despite fears that a recession is looming. Gold is trading flat at US$1,809 an ounce. And the spot iron ore price trades 3.7% lower at US118 a tonne.
- If you hold National Australia Bank (ASX:NAB), Incitec Pivot (ASX:IPL) or CIMIC Group (ASX:CIM), you will receive your dividend payment today.
- Ardent Leisure Group (ASX:ALG), and Clime Capital (ASX:CAM) are set to go ex-dividend today.
Trading Ideas:
- Citi have maintained its Buy rating on Australia's global shipbuilder, Austal (ASX:ASB) with an increased price target from $2.35 to $2.91. At its current share price of $2.38, this implies 22%. share price growth in a year
Trading Central has a bullish signal on Immutep (ASX:IMM) indicating that the stock price may rise from the close of $0.32 to the range of $0.44 - $0.46 in the next 21 days according to standard principals of technical analysis.
Week-to-date the ASX200 is down 0.6% with real estate taking the biggest hit, while utilities remain strong. However, on Friday real estate was the best performing sector, rising 1.5%, while materials and energy suffered from a downturn in commodity prices.
BNPL company Zip (ASX:ZIP) had good start to the new financial year, rebounding 9%, after the company was the worst performing stock in June, dropping 50% of its value during the month. Meanwhile the decline in commodities saw the major mining stocks and energy producers drop in price. Liontown Resources (ASX:LTR) was down the most, and Woodside Energy (ASX:WDS) and Mineral Resources (ASX:MIN) followed. Fortescue Metals (ASX:FMG), Newcrest Mining (ASX:NCM) and BHP Group (ASX:BHP) also dropped about 3%, while the other miners saw heavier losses.
The most traded stocks by Bell Direct clients on Friday were Sims (ASX:SGM), Beach Energy (ASX:BPT) and Wesfarmers (ASX:WES).
US equities rallied, the Dow Jones gained more than 300 points or 1%, the S&P500 also gained 1% and the tech-heavy Nasdaq closed 0.9% higher.
What to watch today:
- The SPI futures are suggesting our local market will jump 1.5% at the open this morning.
- The RBA is widely expected to raise rates by 0.5% tomorrow, so investors may be cautious while awaiting tomorrow’s announcement.
- In commodities, oil and gold are both trading flat, while iron ore has dropped 4%. So watch BHP and FMG today after the pullback in the iron ore price.
- Watch payment company Block (ASX:SQ2). The New York listed Block share price rebounded from recent selling, so its ASX-listed shares are expected to follow. And the positive trading session for the Nasdaq may see a positive day for the ASX tech sector as well.
- In economic data, ANZ’s data on job advertisements for June will be released, and home loan data for May will be released, both at 11:30am AEST.
Trading Ideas:
- Bell Potter have upgraded their rating on Capricorn Metals (ASX:CMM) from a Hold to a Buy and have lowered their price target from $3.90 to $3.70. Bell Potter nominate it as the preferred gold exposure in an environment of rising costs and a rangebound gold price.
- Trading Central have identified a bullish signal in Qube Holdings (ASX:QUB), indicating that the stock price may rise from the close of $2.83 to the range of $3.10 to $3.16 over 17 days, according to the standard principles of technical analysis.
The closing bell has rung for the 2022 financial year, and the Aussie share market finished with a loss of 10.2%, the third negative return this past decade. This was in comparison to the impressive 24% return the market delivered during the 2021 financial year.
In this week’s wrap, Sophia covers:
- (0:55) The 2022 financial year wrap: winners & losers
- (2:16) Why Evolution Mining (ASX:EVN) dropped 30% this week
- (2:38) Collins Foods (ASX:CKF) lifts after robust sales growth
- (2:46) The most traded stocks & ETFs by Bell Direct clients
- (3:26) What to expect from the RBA's upcoming July meeting
Our local market closed lower yesterday, down 0.9%, snapping its four-day winning streak, with the benchmark ASX200 index on track to finish its worst month since March 2020.
Eight of the eleven industry sectors were in the red, with the real estate sector coming under the most pressure, as many property stocks went ex-dividend yesterday. Meanwhile, financials, consumer staples and the energy sector managed to post small gains.
One of the best performers was Star Entertainment Group (ASX:SGR) after the company appointed Robbie Cooke as its new CEO and Managing Director. This comes after Tyro Payments (ASX:TYR) announced that Mr Cooke would be stepping down from his role as CEO and Managing Director at Tyro, after nearly five years of leadership. Star Entertainment Group lifted 3.3%, while Tyro fell 17%. And one of the worst performers was Carsales.com (ASX:CAR), which fell about 10%, after returning from its trading halt. The business has successfully raised $842m from its institutional entitlement offer to help fund its acquisition of US-based online vehicle marketplace called Trader Interactive.
The most traded stocks by Bell Direct clients yesterday were Fortescue Metals (ASX:FMG), ANZ (ASX:ANZ) and Charter Hall Long WALE REIT (ASX:CLW).
In the US, stocks struggled for direction, after heavy falls in the previous session as investors weighed up fresh signs of a looming economic slowdown. So the market closed mixed. The S&P500 and Nasdaq closed slightly lower, while the Dow Jones finished the day up 0.3%.
What to watch today:
- Following the mixed session in the US, our local market is set to open flat if you go by the SPI futures.
- Moving to commodities, oil prices dipped, snapping its three-day winning streak with tight supply worries not enough to outweigh concerns about a weaker global economy. The WTI Crude oil price currently trades at US$109 a barrel. The gold price fell slightly, trading at US$1,818 an ounce, and the spot iron ore price is trading up 2.5% at US124 a tonne.
- Australian industrial company, CSR (ASX:CSR) is holding its AGM today.
- If you hold KMD Brands (ASX:KMD), Kelly Partners Group (ASX:KPG) or Plato Income Maximiser (ASX:PL8), you will receive your dividend payment today.
- There are a number of ETFs going ex-dividend today, including ETF Securities’ FANG ETF, i.e. Facebook, Amazon, Netflix, Google, as well as ETF Securities’ ACDC ETF, which offers investors exposure to the EV megatrend.
Trading Ideas:
- Bell Potter has maintained its Speculative Buy rating on Liontown Resources (ASX:LTR) with a $2.87 price target. LTR has announced a Final Investment Decision (FID) for its flagship hard-rock lithium project in Western Australia, which Bell Potter believes highlights the LTR team’s strong capability in advancing Kathleen Valley in a market experiencing volatility. The company is also in a strong strategic position in a market for lithium facing supply shortages. At its current share price of $1.12, this implies 156% share price growth in a year.
- Trading Central has a bearish signal on Nine Entertainment (ASX:NEC) indicating that the stock price may fall from the close of $1.90 to the range of $1.56 - $1.62 in the next 8 days according to standard principals of technical analysis.
The benchmark ASX200 index posted its fourth consecutive day of gains, up 0.9% at the close. The strongest sectors were energy, utilities and materials, gaining over 3%, while the consumer discretionary sector declined.
Mining stocks advanced as oil futures rallied higher on reports that the G7 Nations are wanting to lift output, however Saudi Arabia is reluctant. Energy producers including Woodside Energy (ASX:WDS) and Beach Energy (ASX:BPT) were among the best performers, as well as the iron ore majors BHP Group (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals (ASX:FMG). And gold miners were also in the green, recovering from the heavy falls we saw in gold stocks the previous session.
Leading the ASX200 was Collins Foods (ASX:CKF). The KFC merchant released its full year results which saw strong gains in NPAT and sales. CKF closed 11.5% higher.
The most traded stocks by Bell Direct clients yesterday were Link Administration (ASX:LNK), Amcor (ASX:AMC), Commonwealth Bank (ASX:CBA) and Woodside Energy (ASX:WDS).
Overseas, European stocks closed slightly higher, although investor sentiment continues to struggle. Also, consumer confidence in Germany is projected to slide to a new record low in July. In New York, US equities declined with all three major benchmarks closing in the red. The benchmarks were rising earlier in the session, however turned direction after a disappointing consumer confidence index reading that came in below estimates. The Dow Jones closed down 1.6%, the S&P500 down 2%, while the Nasdaq dropped 3%.
What to watch today:
- The local market is set to drop 1.26% at the open this morning, according to the Bloomberg SPI futures. This follows the decline in equities in the US overnight.
- ASX tech stocks took a hit yesterday, and are looking to decline further today, following the Nasdaq’s lead. The Nasdaq moved toward its lowest three-month period since 2008.
- In commodities, oil has rebounded, now trading around US$111 per barrel. Gold is trading lower, while iron ore has rallied on solid demand prospects, amid easing COVID restrictions in China’s major cities.
- Watch Carsales.com (ASX:CAR) as its due to return from a trading halt this morning. The company has raised $1.2 billion at a 14.5% discount to its share price.
- Watch Megaport (ASX:MP1) amid speculation that the company is a potential takeover target.
- There are over 30 stocks going ex-dividend. Remember this often sees shares fall as investors take their profits.
Trading Ideas
- Bell Potter maintain a Speculative Buy rating on 4D Medical (ASX:4DX), a software company commercialising its patented imaging platform. They’ve just signed a 3-year contract with I-MED Radiology Network which is the largest medical imaging provider in Australia. And the contact is for the provision of XV Technology which involves imaging systems for lung functions. Bell Potter raised their price target from $0.63 to $0.65, and at its current share price of $0.46, this implies 41.3% share price growth in a year.
- Trading Central have identified a bullish signal in CSL Limited (ASX:CSL), indicating that the stock price may rise from the close of $274.03 to the range of $292 to $295 over 18 days, according to the standard principles of technical analysis.
Well our local market closed started the new trading week and final week of the financial year with a solid gain of 1.9%, supported by a strong rebound in bank stocks.
All eleven industry sectors posted gains, with the financials, energy, tech, and consumer discretionary sectors all gaining more than 2%.
Imugene (ASX:IMU) jumped a massive 46% after the company reported positive survival rates amongst advanced gastric cancer patients treated with HER-Vaxx. Also performing well were lithium stocks like Core Lithium (ASX:CXO), Liontown Resources (ASX:LTR), Lake Resources (ASX:LKE) and Allkem (ASX:AKE). While the worst performers yesterday included Evolution Mining (ASX:EVN), Northern Star Resources (ASX:NST) and Ramelius Resources (ASX:RMS).
The most traded stocks by Bell Direct clients yesterday were Sims (ASX:SGM), Woolworths (ASX:WOW) and CSL (ASX:CSL).
In the US, all three benchmarks started the new trading week in the red, with tech and consumer names coming under pressure, while the energy sector managed to gain 2.8%.
What to watch today:
- Following the negative session in the US, our local market is set to open slightly lower this morning if you go by the SPI futures.
- KFC owner, Collins Foods (ASX:CKF) is set to release its full year results for 2022 today. No guidance has been given, but the market will be looking for further growth after its positive first-half report.
- In commodities, oil prices traded higher on the prospect of even tighter supplies, as the Group of Seven nations examine a new package of actions aimed at increasing pressure on Russia over its war in Ukraine.
- The gold price fell on a weaker dollar as recession fears continue.
- The nickel price took a hit, dropping 6.8% and the spot iron price is trading lower at US$116 a tonne.
- If you hold Champion Iron (ASX:CIA) or GQG Partners (ASX:GQG), you will receive your dividend payment today.
- Bindi Metals will be debuting on the ASX today. It will be trading under the ticker code BIM.
Trading Ideas:
- Citi have upgraded its rating on Iluka Resources (ASX:ILU) from a Sell to a Buy and have maintained its price target at $10.25. The upgrade is due to its share price correction and Citi’s view that China’s property starts are now near their low. At its current share price of $9.25, this implies 13.5% share price growth in a year.
- Trading Central has a bullish signal on Aristocrat Leisure (ASX:ALL) indicating that the stock price may rise from the close of $34.80 to the range of $39.75 - $40.75 in the next 43 days according to standard principals of technical analysis.
Week-to-date the ASX200 rebounded 1.6% and gained 0.8% on Friday. Lithium shares such as Allkem (ASX:AKE), Liontown Resources (ASX:LTR) and Pilbara Minerals (ASX:PLS) all gained, as well as Vulcan Energy (ASX:VUL) after announcing its brought on board Stellantis, the European automotive manufacturing giant, as its second largest shareholder. And tech stocks made strong gains on Friday. It was the best performing sector, up 6%, with family app Life360 (ASX:360) and BNPL company Zip (ASX:ZIP) leading the ASX200, up 22% and 25% respectively. The tech rally followed the jump in US tech shares the previous session.
The most traded stock by Bell Direct clients was Lake Resources (ASX:LKE), which rebounded 15% on Friday, after falling 55% Monday to Thursday, following the departure of the company’s CEO. Lake Resources was the worst performing stock of the week, down 49% Monday to Friday. Also highly traded on Friday was Chalice Mining (ASX:CHN), Westpac (ASX:WBC), Amcor (ASX:AMC) and BHP Group (ASX:BHP).
European stocks had their best session in over three months and US equities also made a strong comeback. All three major US benchmarks rallied. The Dow Jones added more than 800 points, up 2.7%, the S&P500 closed 3% higher at the close, and the tech-heavy Nasdaq also rallied 3% higher.
What to watch today:
- The Australian share market is looking optimistic following the positive session in New York. The SPI futures are suggesting a lift of 1.6% at the open this morning.
- In commodities, oil has dropped further, now trading around US$106 a barrel with expectations of a slowdown in demand and the production shutdown in Libya, making it more difficult for OPEC to meet the production targets. Meanwhile the price of gold is higher, while iron ore is in the red.
- Metcash (ASX:MTS) is set to report its earnings today.
Trading Ideas:
- Bell Potter maintain their Buy rating on Nufarm (ASX:NUF) and have lowered their price target from $7.85 to $6.65. There has been a material rerating in global crop protection and domestic peer trading multiples in recent weeks, and Nufarm hasn’t been immune to the sell off, however Bell Potter continue to see the stock as better placed to navigate a normalisation in Australian crop conditions than its peers. At its current share price of $4.99, the price target implies 33% share price growth in a year.
- Trading Central have identified a bullish signal in Woolworths Group (ASX:WOW), indicating that the stock price may rise from the close of $35.46 to the range of $37.60 to $38.10 over 23 days according to the standard principles of technical analysis.
The Aussie share market managed to gain 0.8% this week (Mon-Thu), regaining some of the heavy losses experienced last week. This comes despite US recession concerns continuing to weigh down on global markets.
In this week’s wrap, Sophia covers:
- (2:30) A stock to consider given the current energy crisis
- (3:21) PointsBet (ASX:PBH) gains after landing $94m investment
- (3:54) Why Lake Resources (ASX:LKE) fell a hefty 55%
- (5:02) The most traded stocks & ETFs by Bell Direct clients
- (5:18) Three economic news items to watch out for
Our local market closed slightly lower yesterday, down 0.2% or 15 points to 6,508, despite the rebound we saw over on Wall Street.
The market was mixed. The utilities sector pushed 2.1% higher, supported by gains in APA Group (ASX:APA). Energy stocks also rallied, like Woodside Energy (ASX:WDS), Beach Energy (ASX:BPT) and Santos (ASX:STO). Meanwhile tech and consumer discretionary stocks led the losses came under pressure.
The best performing stock was Coronado Global Resources (ASX:CRN), which managed to add 7.5% - despite its slump on Tuesday, after the Queensland government announced that there would be increased royalties on coal sales. Also performing well was Ampol (ASX:ALD) following Morgan Stanley retaining its overweight rating and lifting its price target to $39. On the flip side, the worst performers included St Barbara (ASX:SBM), Core Lithium (ASX:CXO) and Lake Resources (ASX:LKE), all down over 13%. Also, Crown Resorts (ASX:CWN) announced news that it had received regulatory approval to start its gaming operations at the Crown Sydney casino, but as the stock is no longer listed on the Aussie market as of last week, following its approval to be taking over by US firm Blackstone, the market couldn’t react.
The most traded stocks by Bell Direct clients yesterday was Stanmore Resources (ASX:SMR), Lake Resources (ASX:LKE), Amcor (ASX:AMC) and Seven West Media (ASX:SWM).
In the US, all three benchmarks closed slightly lower, in a choppy session as markets struggled to sustain a rebound from earlier in the day.
What to watch today:
- If you go by the SPI futures, our local market is set to open 0.36% higher.
- Economic news wise, S&P Global Manufacturing and Services Flash PMI for June will be released. This is a forward-looking estimate of the Purchasing Manager’s Index, exemplifying economic trends in the manufacturing and services sectors.
- In commodities:
- Oil prices came under pressure as investors worry that rate hikes by the US Fed could push the US economy into a recession, therefore dampening demand for fuel.
- The gold price pushed higher given these renewed fears of a recession – therefore boosting the safe-haven’s appeal.
- The spot iron ore price is currently trading at US$117 a tonne, that’s down 20% from its previous highs in early June. So keep watch of iron ore miners like BHP Group (ASX:BHP) and Fortescue Metals (ASX:FMG).
- Leo Lithium will be debuting on the ASX today. It will be trading under the ticker code LLL.
Trading Ideas:
- Citi have maintained its Buy rating on BHP Group (ASX:BHP) with a price target of $50. At BHP’s current share price of $41.03, this implies 22% share price growth in a year.
- Trading Central has a bearish signal on Aurizon Holdings (ASX:AZJ) indicating that the stock price may fall from the close of $3.75 to the range of $3.33 - $3.41 in the next 28 days according to standard principals of technical analysis.
After what was a seven-day losing streak, Australian shares closed 1.4% in the green yesterday, with a rally in mining and energy stocks. Energy and financials were the best performing industry sectors. The 4 major banks all gained over 2%.
The top performing stocks were PointsBet Holdings (ASX:PBH) and Paladin Energy (ASX:PDN), while the worst performer was Lake Resources (ASX:LKE). The lithium developer was added to the ASX200 on Monday and was performing very well, up 185% the past year. Yesterday however, LKE crashed 28%, after the surprising announcement that the company’s CEO and Managing Director, has left the company and the former CEO made no comments.
Bell Direct clients were selling LKE yesterday. Lake Resources was the most traded stock. Clients were also trading ANZ, Core Lithium (ASX:CXO) and Whitehaven Coal (ASX:WHC).
US equities made a comeback overnight, with all three major benchmarks closing with gains. This follows the US markets worst weekly loss in 2 years, as investors assessed aggressive policy tightening by the Federal Reserve and rising chances of a recession. The Dow Jones gained more than 600 points or 2.15%, and the S&P500 and the Nasdaq each gained 2.5%.
What to watch today:
- Following New York, the Australian market is set to open higher today. The SPI futures are suggesting the local market will rise 0.75% at the open this morning.
- In commodities, the price of oil is trading flat. Persistent concerns about tight oil supply continue to outweigh fears of an economic slowdown. The gold price is under pressure amid elevated Treasury yields and a strong US dollar. And iron ore tumbled to around US$115 a tonne, its lowest level since last December. This fall comes due to persistent COVID outbreaks in China, as well as global rate hikes, raise concerns about demand.
- Fisher & Paykel Healthcare (ASX:FPH) is set to go ex-dividend.
- Odette Six Metals (ASX:OD6) will list on the ASX today.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on PointsBet Holdings (ASX:PBH). The corporate bookmaker yesterday announced the placement of 38.75 million shares at an issue price of $2.43 per share to SIG Sports Investments, who will become the largest shareholder in the company, and the placement will raise $94.2 million for PointsBet. The company also announced they’ve entered an agreement with a company called Nellie Analytics, to provide sports analytics and quantitative modelling services. Bell Potter have lowered their valuation from $6 to $5.25. At PBH’s current share price of $2.78, this implies 88.8% share price growth in a year.
- Trading Central have identified a bullish signal in Nearmap (ASX:NEA). Indicating that the stock price may rise from the close of $1.03, to the range of $1.26 to $1.32 over 15 days, according to the standard principles of technical analysis.
Our local market started the new trading week in the red, extending its losses from last week, to close down 41 points, or 0.6% to 6,433. That marks seven straight days of losses for our market.
The biggest laggard on the market was the energy sector, which declined 5.2%, after oil prices dropped on Friday on worries that interest rate hikes by major central banks could cut energy demand. While the major banks closed in positive territory, outperforming the broader share market.
The best performing stock was Pointsbet (ASX:PBH) after the betting company secured a $94 million investment from SIG Sports. That makes the US investment firm PBH’s largest shareholder. Also performing well was Pinnacle Investment Management (ASX:PNI) and bio-tech company, Imugene (ASX:IMU), both up more than 7%. Meanwhile, the worst performing stocks included lithium producers like Lake Resources (ASX:LKE), uranium miner, Paladin Energy (ASX:PDN) and coal miners like New Hope Corporation (ASX:NHC) and Whitehaven Coal (ASX:WHC).
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), BHP Group (ASX:BHP) and Fortescue Metals (ASX:FMG).
The US market was closed for the Juneteenth Federal holiday, so let’s look across the sea at how European markets performed. The FTSE index lifted 1.5% as financials and energy rebounded. The German Dax closed 1.1% higher and the French CAC jumped 0.6%.
What to watch today:
- If you go by the SPI futures, our local market is set for a positive day. The futures are up 0.7% or 45 points.
- Economic news wise, at 8am AEST, the RBA will be releasing to the media their review of the yield target. Following this, at 10am, Governor Phillip Lowe, will speak about inflation and monetary policy at an event in Sydney and finally, the RBA will also release the minutes from its June meeting at 11:30am. These are all important, as they may give us a sense on how aggressive the RBA will be on raising rates as well as what could happen in the next few months
- In commodities:
- Oil prices edged lower on Monday, amid concerns about slowing global economic growth.
- Gold extended its losses as a rise in the US dollar weighed on bullion demand, with the US market holiday expected to lead to thin trading during the day.
- The spot iron ore price is trading down at US$125 a tonne.
- Peter Alexander owner, Premier Investments (ASX:PMV) and chartered accounting company Kelly Partners Group (ASX:KPG) are set to go ex-dividend today.
- If you hold Virgin Money UK (ASX:VUK), Coronado Global Resources (ASX:CRN) or Oceania Healthcare (ASX:OCA), you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on software company, Altium (ASX:ALU), however with a reduced price target, from $41.25 to $34. At its current share price of $25.49, this implies about 33% share price growth in a year.
- Trading Central has a bearish signal on Origin Energy (ASX:ORG) indicating that the stock price may fall from the close of $5.45 to the range of $3.60 - $4 in the next 98 days according to standard principals of technical analysis.
It was the worst week for the Australian market since the beginning of the pandemic in 2020. Week-to-date the ASX200 is down 6.6%, led by losses on Wall Street on concerns around aggressive policy tightening.
On Friday, the ASX200 closed 1.8% lower, with materials, tech, financials and energy down the most.
Taking a closer look at the leaderboard, the worst performing stock was G.U.D Holdings (ASX:GUD). The company is a designer, manufacturer and distributor of automatic products and its share price crashed 20% on Friday, following a guidance update, where the company downgraded its guidance due to supply chain disruptions. And some big tech names were finally in the green, including EML Payments (ASX:EML) and Zip Co (ASX:ZIP), regaining some of those prior losses.
The most traded stocks by Bell Direct clients on Friday were CSL (ASX:CSL), Macquarie Group (ASX:MQG), Lake Resources (ASX:LKE), Westpac (ASX:WBC) and BHP Group (ASX:BHP).
On Wall Street, the major benchmarks closed mixed. The Dow Jones slipped 38 points or 0.13%. The S&P500 rose slightly higher, up 0.2%, however still had its worst week since 2020, down 5.8% for the week, with all 11 sectors finishing more than 15% below their recent highs. Meanwhile, the tech-heavy Nasdaq gained 1.4%.
What to watch today:
- The Australian market is set to drop 0.3% at the open this morning, going by the SPI futures.
- What may add to the decline in global markets is the collapse of cryptocurrencies. Bitcoin tumbled 15% over the weekend, its lowest level in 18 months.
- In commodities, the price of oil has crashed 6.8%, pressured by the recent wave of aggressive rate hikes. Gold is also trading lower amid a rebound in the US dollar and Treasury yields. And iron ore has dropped to an over three-week low as COVID-19 outbreaks in China provoked fears of lockdowns. China is the world’s top steel producer.
- Premier Investments Limited (ASX:PMV) is set to go ex-dividend.
Trading Ideas:
- Bell Potter have a Speculative Buy rating on Lumos Diagnostics (ASX:LDX) and have reduced their valuation to $0.28 from $0.75. At its current share price of $0.14, this implies 95.5% share price growth in a year.
- Trading Central have identified a bullish signal in Capricorn Metals (ASX:CMM), indicating that the stock price may rise from the close of $3.80 to the range of $5 to $5.30 over 43 days, according to the standard principles of technical analysis.
The Aussie share market took a dive this week, falling 4.9% (Mon-Thu). This followed the latest inflation reading out in the US, which saw the US Federal Reserve respond by lifting interest rates by 0.75%.
In this week’s wrap, Sophia covers:
- (1:55) Bell Potter's top picks in the uranium sector
- (2:20) The US Federal Reserve's rate hike
- (3:40) The tech and major mining stocks that suffered heavy losses
- (4:14) Lake Resources' (ASX:LKE) impressive yearly gain
- (4:36) The most traded stocks & ETFs by Bell Direct clients
- (5:15) Two economic news items to watch out for
Yesterday our local market extended its losses, falling 1.3% or 85 points to close at 6,601. This comes as investors digested rising interest rate forecasts and an increase to the minimum wage. We also got an update on consumer confidence for June, which fell 4.5% month-over-month, back to levels seen at the beginning of the pandemic. Now confidence was weighed down by surging prices and expectations of further interest rate hikes.
Losses were seen across the board, with all 11 industry sectors in the red. The tech sector was down the most, as it’s quite sensitive to interest rates, due to their high price to earnings ratios and low dividend payments.
The best performer yesterday was medical device company PolyNovo (ASX:PNV) despite no announcements out from the company. However, insider buying action amongst its senior managers has likely propped up its share price and overall sentiment. Other top performers included Lynas Rare Earths (ASX:LYC), Suncorp (ASX:SUN) and Computershare (ASX:CPU). Meanwhile, the worst performers included tech companies like NOVONIX (ASX:NVX), Megaport (ASX:MP1) and Block (ASX:SQ2).
And the most traded stocks by Bell Direct clients were ANZ (ASX:ANZ), Insignia Financial (ASX:IFL) and Lake Resources (ASX:LKE).
In the US, as was widely expected, the US Federal Reserve lifted rates by 75 basis points, the biggest increase made in almost 30 years. Stocks rallied, as Federal Reserve Chairman Jerome Powell noted that a 50 or 75 basis point increase “seems most likely” at its next meeting in July, highlighting the central bank’s commitment to fighting inflation. So, we saw all three benchmarks push higher, with the Nasdaq up the most, rising 2.5%.
What to watch today:
- Following the US market’s positive session, our local market is set for a positive day, with the SPI futures suggesting a lift of 0.4% at the open.
- Economic news wise, the latest jobs figures will be released today, with the May unemployment rate expected to remain steady on forecasts of a small gain in jobs across the economy.
- Keep an eye on Coronado Global (ASX:CRN) – its share price might see a lift today after news that the coal miner has been added to the ASX200 index, replacing Crown Resorts (ASX:CWN), which has been delisted following Blackstone’s takeover.
- In commodities:
- Oil prices tumbled over 2% amid concerns that rising interest rates would impact demand. The WTI crude oil pride now trades at around US$116 a barrel.
- Gold prices retreated from their highs of the day after the rate hike. Now remember, although gold is considered a hedge against inflation, rate hikes increase the opportunity cost of holding non-yielding bullion.
- The spot iron ore price is trading 0.7% lower at US$136 a tonne.
- If you hold medical device company ResMed (ASX:RMD) you will receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on hardware company, Coventry Group (ASX:CYG) with a reduced price target from $2.00 to $1.70. Bell Potter sees Coventry as a business that is fast approaching an inflexion point in recovery, with market share in Australia being recouped at pace and, importantly, little cost to gross margin. Now, at its current share price of $1.20, this implies about 42% share price growth in a year.
- Trading Central has a bearish signal on Duxton Farms (ASX:DBF) indicating that the stock price may fall from the close of $1.68 to the range of $1.40 - $1.46 in the next 111 days according to standard principals of technical analysis.
Yesterday was the worst trading session since May 2020, as we saw heavy losses that haven’t been since around the beginning of the pandemic. Billions were wiped from the market yesterday, with the ASX200 falling 5.3% in the first 20 minutes of the session, then very slightly recovering some of those losses. The market still closed 3.6% lower at 6,686 points. The reason behind this was the heavy selling we’ve seen in US markets over its last two trading sessions. And this was the first time the Australian market was able to respond, since our local market was closed on Monday for the Queen’s Birthday public holiday. The reason US markets have tumbled is because its inflation reading came in higher than expected. Now, on Thursday the Fed will announce its interest rate decision and these inflation numbers have increased the chances of the Fed raising rates more aggressively.
As the Australian market caught up to the US yesterday, all 11 sectors saw heavy losses. The sectors that declined the most were energy, tech, materials and financials. The major banks also continued to fall. Yesterday CBA was down 2.8%, Westpac down 3.7%, NAB down 4.4% and ANZ is down 4.6%.
The worst performing stocks were tech giants Block (ASX:SQ2) and Zip (ASX:ZIP), which we know are sensitive to interest rates. And some of the major mining stocks were also being sold, including Chalice Mining (ASX:CHC), Paladin (ASX:PDN), Champion Iron (ASX:CIA) , Nickel Industries (ASX:NIC) and Fortescue Metals (ASX:FMG). There were only a handful of stocks that managed to gain yesterday. The best performer was PolyNovo (ASX:PNV), followed by Domino’s Pizza (ASX:DMP).
The most traded stocks by Bell Direct clients yesterday were Lake Resources (ASX:LKE), ANZ, Westpac (ASX:WBC) and CSL.
Overnight, US equities saw little change, as investors await the Federal Reserve’s meeting on Thursday. The Dow is down 0.5%, the S&P500 is down 0.4% while the Nasdaq ended slightly higher, up 0.2%.
What to watch today:
- Selling is set to continue today, with the SPI futures suggesting a 0.6% fall at the open this morning.
- In economic data, Westpac’s consumer confidence data for June will be out today at 10:30am AEST. This data is important because it will provide insights into how consumers have responded to the RBA’s rate hike last week.
- In commodities, oil is lower after signals that the US government may be considering legislation to ease the price pressures. Gold remains under pressure from a rallying US dollar and Treasury yields, as investors anticipate aggressive monetary policy tightening. And iron ore has fallen to an over two-week low.
- Keep watch of ANZ, as the bank may be planning on acquiring accounting software MYOB, from private equity group KKR.
Trading Ideas:
- Bell Potter maintain their BUY rating on Cobram Estate Olives (ASX:CBO) and have lowered their price target from $2.35 to $2.20. At its current share price of $1.56, this implies 40.6% share price growth in a year.
- Trading Central have identified a bearish signal in Inghams Group (ASX:ING), indicating that the stock price may fall from the close of $2.67 to the range of $2.45 to $2.53 over 25 days, according to the standard principles of technical analysis.
The market was closed yesterday for the Queen’s Birthday public holiday, so before we jump into today’s trading session, let’s have a quick look at what happened last Friday.
Our local market experienced its worst week since 2020, dipping below 7,000 points, as markets digested the RBA’s second rate hike, which worried investors over the impact on the big banks' bottom lines. All sectors were in the red, with the real estate, consumer discretionary and energy sectors down the most.
Looking at the ASX200 leaderboard, the top performer was accounting software business, Xero (ASX:XRO), after Citi reiterated its Buy rating and $108 price target. Meanwhile the worst performers included Pointsbet (ASX:PBH), Sims (ASX:SGM) and Lynas Rare Earths (ASX:LYC).
The most traded stocks by Bell Direct clients last Friday included all four of the big banks, CSL (ASX:CSL) as well as Lake Resources (ASX:LKE).
Moving to the US, on Friday, the highly anticipated inflation report showed a faster-than-expected rise in prices, which took a toll on the share market. CPI came in at its highest level since 1981, rising 8.6% year-over-year. And on Monday’s session, the US market continued to come under pressure, as recession fears intensified ahead of this week’s key Federal Reserve meeting. This saw the S&P500 fall 3.9% to 3,749 points, its lowest level since March 2021, bringing its losses down more than 20% from its January record, therefore entering into bear market territory.
What to watch today:
- Following two consecutive negative sessions in the US, our local market is set to fall 2.7% this morning if you go by the SPI futures.
- Economic news wise, today we’ll get an update on business confidence for May. In April, the index dropped to 10, from a 5-month high of 16 in March, and today’s reading is expected to come in at 12 points.
- In commodities, the oil price rose as tight supplies outweighed demand worries. The gold price slumped over 2%, as the US dollar strengthened ahead of steep interest rate hikes expected by the US Federal Reserve, and the spot iron ore price is trading 2.4% lower at US$141 a tonne.
- Kingsland Minerals will begin trading on the ASX today, under the ticker code KNG. Kingsland is a mineral exploration and development company focusing on high-grade uranium, copper, and gold projects across Australia.
- Stocks going ex-dividend today include Cimic Group (ASX:CIM) and KMD Brands (ASX:KMD), which was formerly Kathmandu Holdings.
- If you hold Amcor (ASX:ABC) or investment company, Whitefield (ASX:WHF), you will receive your dividend payment today.
Trading Ideas:
- Citi have maintained its Buy rating on Domino’s Pizza (ASX:DMP), however have reduced its price target from $108.42 to $100.95. Citi’s analysis of high frequency data suggests that Domino’s website traffic in key markets (Europe and Japan) is under increasing pressure, likely further intensified by inflationary pressures and labour shortages. Citi does however see upside from potential merger and acquisition activity and expect sales momentum to rebound later in calendar year 2022. At its current share price of $62.41, this implies about 62% share price growth in a year.
- Trading Central has a bearish signal on Charter Hall Retail REIT (ASX:CQR) indicating that the stock price may fall from the close of $3.95 to the range of $3.25 - $3.40 in the next 141 days according to standard principals of technical analysis.
The Aussie share market declined 3% this week (Mon-Thu), as interest rate sensitive sectors such as real estate, tech and financials fell following the RBA’s interest rate rise on Tuesday.
In this week’s wrap, Sophia covers:
- (0:09) Why bank stocks have entered correction territory
- (1:39) Why Atlas Arteria (ASX:ALX) jumped 13%
- (2:00) Woodside Energy (ASX:WDS) booming as oil and gas prices rise
- (2:31) Zip (ASX:ZIP) tumbling 20% after Apple launches BNPL platform
- (3:37) The most traded stocks & ETFs by Bell Direct clients
- (3:56) Four economic news items to watch out for
The local market managed to gain 0.4% yesterday, regaining some ground after Tuesday’s interest rate rise slump.
The market was up nearly 1% at one point, supported by tech, mining and oil stocks, however, ran out of stream by the session close, as all of the big banks raised their mortgage interest rates in line with the RBA, so the financials sector was the only sector to post a loss, down 2.9%.
Looking at the ASX200 leaderboard, private toll road developer and operator, Atlas Arteria (ASX:ALX) jumped 16% as news came in that IFM had snapped up a 15% holding in the company, and that the infrastructure fund might put forward a takeover bid in the future. This comes amid hot competition for long-term infrastructure assets. Also performing well was Boral (ASX:BLD), up 15% after the building products company announced it had appointed its new CEO. Meanwhile, banking stocks tumbled. Bendigo & Adelaide Bank (ASX:BEN), Westpac (ASX:WBC) and Commonwealth Bank (ASX:CBA) fell the most, all down over 4%, likely driven by concerns that an aggressive tightening cycle by the RBA could create challenges for the banking sector.
We saw both Commonwealth Bank (ASX:CBA) and Westpac (ASX:ABC) at the top of the most traded stocks by Bell Direct clients yesterday. Also highly traded was the BetaShares Geared Australian Equity Hedge Fund ETF (ASX:GEAR), Woodside Energy Group (ASX:WDS) and Pacific Smiles Group (ASX:PSQ).
Over in the US, all three benchmarks were in the red. The Dow Jones down 0.8%, the S&P500 down 1.1% and the Nasdaq down 0.7%. This comes as investors monitor signs of a potential economic slowdown. Also, action in the bond market may have hurt investor sentiment, as the 10-year Treasury yield jumped back above 3%.
What to watch today:
- Our local market is set to fall 0.76% this morning if you go by the SPI futures.
- Keep an eye on BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO), as both of its US-listed shares tumbled overnight. So, today could be a tough day for the mining sector.
- In commodities:
- Oil jumped to a 13-week high on rising US gasoline demand. The WTI crude oil price is up 2.5% to US$122 a barrel and the Brent crude oil price is up 2.7% to US$124 a barrel.
- The gold price strengthened as worries over economic growth boosted the safe-haven’s appeal, ahead of the US inflation data due out on Friday.
- The spot iron ore price is trading 1% higher at US$146 a tonne.
Trading Ideas:
- Bell Potter have maintained its Hold rating on Platinum Asset Management (ASX:PTM) with a price target of $1.70. While May’s funds under management or FUM figures were not bad, Bell Potter find that there is still little to be positive about. FUM has fallen 16.6% year to date, and at this stage Bell Potter expects average FUM for the year ending June 2022 to be $21.5b, which is 7.4% lower than 2021. At its current share price of $1.74, this implies -2% share price growth in a year.
- Trading Central has a bullish signal on TPG Telecom (ASX:TPG) indicating that the stock price may rise from the close of $6.07 to the range of $6.80 - $7.00 in the next 94 days according to standard principals of technical analysis.
The Australian share market tumbled yesterday, closing the trading session 1.5% in the red, after the RBA raised the cash rate yesterday, increasing the velocity of higher borrowing costs. In its June meeting yesterday, the RBA raised the cash rate by 50 basis points to 0.85%, which is the largest lift in 22 years – the last time it was raised this much was in February 2000. It is also the first time since 2010 that the cash rate has been raised for the second month in a row. So, the market negatively reacted to the rate hike, and had its worst day in almost 3 weeks. All industry sectors declined, with tech and real estate falling the most, both sectors are sensitive to interest rates.
Taking a closer look at the ASX200, the stocks that managed to make gains yesterday included Sandfire Resources (ASX:SFR), Inghams Group (ASX:ING) and Ampol (ASX:ALD), while the stocks that declined the most were BNPL company Zip (ASX:ZIP) and Clinuvel Pharmaceuticals (ASX:CUV).
The most traded stocks by Bell Direct clients yesterday were Australia & New Zealand Bank (ASX:ANZ), Lake Resources (ASX:LKE), Westpac (ASX:WBC), National Australia Bank (ASX:NAB) and Commonwealth Bank (ASX:CBA).
European stocks closed slightly lower amid inflation concerns, however over in the US it was a positive session, with all three major benchmarks closing higher. The Dow up 0.8%, the S&P500 up 0.95% and the Nasdaq up 0.9%.
What to watch today:
- The Australian market is set to regain some of yesterday’s losses and follow Wall Street’s lead. The SPI futures are suggesting the ASX200 will rise 0.63% at the open this morning.
- In commodities:
- Oil is trading higher and crude futures are nearing 14-year highs, after OPEC decided to raise output for July and August.
- The gold price is also higher, as gold is often viewed as a safe-haven metal by investors in a risk-adverse environment, and concerns continue around slowing global growth and inflation.
- Iron ore has also rallied, with seaborne iron ore trading around US$145 a tonne.
- As for economic data to watch out for today, at 11:30am AEST, NAB’s business confidence data for May will be released, which will give us an indication of sentiment across all industry sectors. And confidence is forecast to rise from last month.
- Also today, watch Southern Palladium Limited (ASX:SPD) which lists on the ASX today.
Trading Ideas:
- Bell Potter have upgraded their rating on PWR Holdings (ASX:PWH) from a Hold to a Buy and have lowered their price target from $10 to $9.25. At its current share price of $7.21, this implies 28.3% share price growth in a year.
- And Trading Central have identified a bearish signal in Harvey Norman (ASX:HVN), indicating that the stock price may fall from the close of $4.26 to the range of $3.93 to $3.99 over 13 days, according to the standard principles of technical analysis.
Yesterday, the Aussie share market started the new trading week in the red, dipping 0.5% lower to 7,206 points.
The majority of the industry sectors posted losses, with the tech sector the biggest drag, falling 1.6%. While the energy sector posted a decent gain after Saudi Arabia raised oil prices substantially.
Looking at the best and worst performers, gambling company, Tabcorp (ASX:TAH) advanced the most, after the state of Queensland announced tax reforms that are expected to boost revenues. Graincorp (ASX:GNC) also performed well, following the release of a positive broker note out of Macquarie. Its analysts retained their outperform rating and $11.10 price target. Meanwhile, the worst performer yesterday was Magellan Financial Group (ASX:MFG). MFG’s share price tumbled nearly 14% after its funds under management fell 5.2% to $65 billion in May.
The most traded stocks by Bell Direct clients yesterday were Lake Resources (ASX:LKE), Whitehaven Coal (ASX:WHC) and Fortescue Metals (ASX:FMG).
Moving to the US, all three benchmarks managed to close higher, with the Nasdaq advancing the most, up 0.4%. It was a choppy day of trade, with the market navigating a jump in Treasury yields.
What to watch today:
- Our local market is set to fall slightly this morning if you go by the SPI futures. The futures are suggesting a small drop of 0.07% at the open.
- In economic news, the RBA, Australia’s central bank is all but certain to lift interest rates for the second month in the row. The cash rate currently sits at 35 basis points, with economists expecting a hike of 40 to 50 basis points. While Governor Phillip Lowe has previously voiced support for more conventional 25 basis point increases. So, keep watch today at 2:30pm AEST.
- Moving to commodities, the oil price topped US$120 a barrel as Saudi Arabia raised its July crude prices. The gold price dipped on a stronger dollar and Treasury yields. The seaborne iron ore price is trading 0.6% higher at US$145 a tonne.
- Lastly, if you hold Perpetual Credit Income Trust (ASX:PCI), you will receive your dividend today.
Trading Ideas:
- Citi have maintained its Buy rating on cloud tech company, Megaport (ASX:MP1), however have reduced its price target from $16.60 to $12.30, to reflect higher cost of capital and earnings downgrades. While the reduction in Megaport Virtual Edge (MVE) pricing could suggest softer demand, Citi sees the new bandwidth options as positive as high IP transit costs were a barrier for MVE adoption in Australia and New Zealand. At its current share price of $6.30, this implies 95% share price growth in a year.
- Trading Central has a bearish signal on Northern Star Resources (ASX:NST) indicating that the stock price may fall from the close of $8.58 to the range of $5.10 - $5.80 in the next 152 days according to standard principals of technical analysis.
Week-to-date, the ASX200 gained 0.78%, with energy and materials gaining the most, while utilities declined. Last Friday was a positive session, with the ASX200 closing 0.9% higher, led by the materials and tech sectors, which each advanced more than 2%.
The major miners gained the most on Friday, boosted by demand for iron ore and well as a lithium stocks, which extended their rebound after Wednesday’s sell-off. The best performers were Champion Iron (ASX:CIA), Pilbara Minerals (ASX:PLS), Gold Road Resources (ASX:GOR), Liontown Resources (ASX:LTR) and Nickel Mines (ASX:NIC). And the worst performer was healthcare company Healius (ASX:HLS), following an update that revealed its EBIT came in just under $100 million, compared to first half EBIT of $376 million.
The most traded stocks by Bell Direct clients on Friday were Lake Resources (ASX:LKE), Fortescue Metals (ASX:FMG), Whitehaven Coal (ASX:WHC), BHP Group (ASX:BHP) and Commonwealth Bank (ASX:CBA).
Overseas, European and US equities declined, following the release of a stronger-than-expected jobs report and its implication for monetary policy moving forward. The latest jobs report saw that hiring in the US remained elevated in May, however the sell-off was likely a reaction to fears that the Fed will be tightening monetary policy. The benchmark 10-year Treasury yield climbed after the report, above 2.9%. Investor fears around higher rates are around the possibility that it could cause an economic slowdown that could lead to a recession, and higher yields also discount the value of future earnings, making some stocks, like tech, less attractive. The Dow Jones closed 1.05% lower, the S&P500 down 1.6% and the Nasdaq down 2.5%.
What to watch today:
- Following Wall Street, the Australian share market is set to fall 0.44% at the open this morning, going by the SPI futures.
- Today watch the share price movements of Liontown Resources (ASX:LTR), which is due to release an update to the market on its lithium agreement with Tesla.
- In economic data, today investors may be trading cautiously, with all focus on the RBA’s policy meeting tomorrow, as well as the European Central Bank meeting on Thursday.
- In commodities:
- The oil price rallied after OPEC delivered a modest increase in output, deciding to increase production by 648,000 barrels per day in July and August, instead of 432,000 barrels per day previously. This was seen as insufficient to compensate for Russia’s lost supply, as the European Union’s ban on Russian oil kicks in. And Russian output has dropped by 1 million barrels per day since the invasion of Ukraine.
- On the other hand, the gold price extended losses, following the US jobs report, while seaborne iron ore is rising higher.
- Companies going ex-dividend today include ALS Limited (ASX:ALQ), Champion Iron (ASX:CIA) and Incitec Pivot (ASX:IPL).
Trading Ideas:
- Bell Potter maintain their Buy rating on Accent Group (ASX:AX1), with a $2.20 price target. The company is a footwear and sports clothing retailer and are investing in its store rollout and customer engagement, particularly for vertical brands. Bell Potter sees these higher margin sales to likely become a major driver of margin improvement and earnings growth. And AX1 last closed at $1.34, implying 64.8% share price growth in a year.
- Trading Central have identified a bullish signal in AMP (ASX:AMP), indicating that the stock price may rise from the close of $1.12 to the range of $1.24 to $1.26 over 21 days, according to the standard principles of technical analysis.
The Aussie share market fell slightly this week, down 0.1% (Mon-Thu), with utilities, tech and financials coming under pressure.
In this week’s wrap, Sophia covers:
- (0:10) Lithium stocks falling deep in the red
- (2:02) Why a2 Milk Company (ASX:A2M) gained 9%
- (2:55) Catapult Group (ASX:CAT) declining after disappointing results
- (3:20) The most traded stocks & ETFs by Bell Direct clients
- (3:50) Two economic news item to watch out for
Yesterday, the Aussie share market started the month of June with a gain of 0.3% or 22 points, despite a huge lithium sell-off.
The market was mixed. The communication services sector advanced the most, while the utilities sector fell a massive 5.3%.
Looking at the ASX200 stock leaderboard, lithium miners, like Pilbara Minerals (ASX:PLS), Liontown Resources (ASX:LTR) and Allkem (ASX:AKE) were amongst the worst performers, all falling over 15%. This is due to three key factors: Firstly, Goldman Sachs have warned of a “sharp correction” in lithium prices in the next two years, secondly, customs in Argentina have set a reference price to stop ‘irregularities” and thirdly, Chinese EV giant BYD signalled plans to buy six African lithium mines. Meanwhile, the best performers yesterday included Fortescue Metals (ASX:FMG), Telstra (ASX:TLS) and TPG Telecom (ASX:TPG).
Looking at the US, Wall Street started the month of June lower, amid worries about the health of the economy. All three benchmarks were in the red, with the Dow dropping nearly 200 points, the S&P500 falling 0.75%, and the tech-heavy Nasdaq down 0.72%.
What to watch today:
- Following the negative session in the US, our local market is set to fall this morning if you go by the SPI futures. The futures are suggesting a drop of 0.76% at the open.
- Economic news wise, today we’ll get the latest data on Australia’s trade surplus for April, and the market is forecasting $9 billion trade surplus for the month.
- Keep watch of Pilbara Minerals (ASX:PLS), who have announced its new CEO. According to its release, the business will be promoting its chief operating officer, Dale Henderson to the CEO role.
- Moving to commodities:
- The oil price rose as the European Union leaders agreed to a phased ban on Russian oil, and as China ended its COVID-19 lockdowns in Shanghai.
- The gold price also lifted from its two-week low, as investors looked towards the safe-haven asset amid worries over an increase in inflation. However, a stronger dollar and higher US yields kept gains in check.
- The seaborne iron ore price is trading 2.6% higher at US$137 a tonne.
- TechnologyOne (ASX:TNE) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on building company, Johns Lyng Group (ASX:JLG), with a reduced price target, from $8.70 to $7.50. Bell Potter’s favourable view on JLG is supported by the business being the category leader in Australia, its scalable business model, strong cash flow, as well as its opportunities in the US. Now, at its current share price of $5.92, this implies 26% share price growth in a year.
- Trading Central has a bearish signal on Mineral Resources (ASX:MIN) indicating that the stock price may fall from the close of $58.70 to the range of $47 - $50 in the next 16 days according to standard principals of technical analysis.
The local market fell into the red yesterday as the financials and technology sectors weighed down on the market, after hawkish comments from the US Fed, that moved US yields higher. Also weighing down on the market was the European Union’s decision to pursue the ban on Russian oil. This has been in discussion for a while now and yesterday the EU agreed to a partial oil embargo on Russia over the invasion of Ukraine. This aims to cut 90% of Russia’s crude imports by the end of the year and aims to reduce Russia’s income to finance the war it launched on Ukraine three months ago.
The ASX200 closed 1% lower yesterday will all sectors in the red. Zip (ASX:ASX:ZIP), EML Payments (ASX:EML), Megaport (ASX:MP1), Tyro Payments (ASX:TYR) and Suncorp Group (ASX:SUN) declined the most yesterday. Suncorp was also downgraded yesterday by Morgan Stanley, who now rate SUN as Underweight.
As for the best performers, Beach Energy (ASX:BPT), De Grey Mining (ASX:DEG) and Whitehaven Coal (ASX:WHC) fought against the market sell-off.
The most traded stocks by Bell Direct clients yesterday were Lake Resources (ASX:LKE), Scentre Group (ASX:SCG) and the BetaShares Geared Australian Equity Hedge Fund (ASX:GEAR).
Over in the US, all three major benchmarks closed lower. The Dow Jones down 0.7%, the S&P500 down 0.6% and the Nasdaq down 0.4%.
What to watch today:
- The decline is set to continue today. Locally, the SPI futures are suggesting the Australian market will fall 0.36% at the open this morning.
- In commodities, the oil price is trading lower. OPEC is considering suspending Russia’s participation in the cartel, and this could make room for other producers. And as mentioned earlier, the EU has agreed to ban 90% of Russian crude by the end of this year. This embargo will cover Russian oil brought in by sea, while keeping a temporary exemption for pipeline crude, to meet the demand of Hungary, Slovakia and the Czech Republic.
- The gold price is also trading lower, weighed down by a rebound in the US dollar and firmer US Treasury yields. And iron ore is higher with better demand prospects in the market.
- In economic data, at 11:30am AEST the GDP Growth Rate for Q1 will be announced.
- Keep watch of Western Areas (ASX:WSA), as today there’ll vote on the company’s nickel-lithium merger with IGO.
- Sezzle (ASX:SZL) will hold its AGM today.
- United Malt Group (ASX:UMG) goes ex-dividend today.
- Also watch Nordic Nickel Limited (ASX:NNL), which lists on the ASX today.
Trading Ideas:
- Bell Potter maintain a Speculative Buy rating on De Grey Mining (ASX:DEG), after the company released an updated Mineral Resource for its 100%-owned Mallina Gold Project in Western Australia. They have increased their valuation on DEG by 5% to $1.80. And at its current share price of $1.13, this implies 59% share price growth in a year.
- Trading Central have identified a bullish signal in Strandline Resources (ASX:STA), indicating that the stock price may rise from the close of $0.37 to the range of $0.44 – to $0.46 over 22 days, according to the standard principles of technical analysis.
Yesterday, the Aussie share market started the new trading week with an impressive gain of 1.5%. The tech sector led the rally, up 4.6% after US inflation rose just 0.2% in April, which is the smallest increase we’ve seen in about a year and a half. So investors took the inflation data to mean that the central banks may deliver less aggressive rate hikes to control inflation.
The majority of the top 10 best performing stocks on the ASX200 yesterday were tech shares, like Zip (ASX:ZIP), NOVONIX (ASX:NVX), Block (ASX:SQ2), Tyro Payments (ASX:TYR) and Megaport (ASX:MP1). While Appen (ASX:APX) continues its downward trend, losing 3.7%, after Tellus International walked away from takeover talks.
The most traded stocks by Bell Direct clients yesterday, they included Lake Resources (ASX:LKE), Bowen Coking Coal (ASX:BCB) and BHP Group (ASX:BHP).
Wall Street was closed on Monday for the Memorial Day federal holiday, however European stocks closed higher as China relaxed some of its COVID-19 restrictions. The German Dax lifted 0.8%, the FTSE index jumped 0.2% and the French CAC rose 0.7%.
What to watch today:
- The Aussie share market looks to have run out of steam, as the SPI futures are suggesting that our local market is set to open 0.1% lower this morning.
- Keep watch of Crown Resorts (ASX:CWN) today as the business has been hit with a $80m fine from the Victorian Gambling and Casino Control Commission, over its illegal practice of accepting Chinese bank cards at its Melbourne casino to fund gambling and disguising the transactions as hotel expenses.
- In commodities, the oil price jumped to US$117 a barrel, a two-month high as investors wait to see if the European Union will reach an agreement on banning Russian oil. The gold price also lifted, as the US dollar dipped. While, the copper price declined 6.6% to $4.02 per pound, following ongoing demand concerns from China.
- If you hold Janus Henderson (ASX:JHG), Autosports Group (ASX:ASG), Plato Income Maximiser (ASX:PL8), Red Hill Iron (ASX:RHI) or Kelly Partners Group (ASX:KPG), you will receive your dividend payment today.
- Orica (ASX:ORI) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its Hold rating on Appen (ASX:APX) but have reduced its price target from $6.75 to $6.50. Bell Potter have also downgraded its earnings per share forecast by 5% in both 2022 and 2023 and 4% in 2024. Now at its current share price of $6.30, this implies 3% share price growth in a year.
- Trading Central has a bullish signal on the a2 Milk Company (ASX:A2M) indicating that the stock price may rise from the close of $4.77 to the range of $5.15 - $5.30 in the next 36 days according to standard principals of technical analysis.
Week-to-date the ASX200 has advanced 0.52%, boosted by the rebound in Friday’s session, when the market closed just over 1% higher, lifting the ASX200 index to its second consecutive weekly advance. 10 of the 11 industry sectors posted gains. The best performing sectors were energy, which lifted as oil prices neared two-month highs, and the consumer discretionary sector, which followed optimistic forecasts from retailers in the New York. The major banks also all advanced, supporting the broader market.
The best performing stocks were Pointsbet Holdings (ASX:PBH), City Chic Collective (ASX:CCX) and Block (ASX:SQ2). The worst performer on Friday was Appen (ASX:APX), after it was the best performer Monday-Thursday. Appen is an artificial intelligence services provider, which was approached by Canadian tech company Telus for a $1.2 billion takeover offer, offering $9.50 per share. However, Telus then withdrew their offer and Appen’s share price dropped 21% in Friday’s session. And Appen has received a lot of investor criticism, following the news.
The most traded stock by Bell Direct clients on Friday were Galileo Mining (ASX:GAL). Investors took their profits after the company’s share price jumped 20.6% on Friday, following news that the miner has discovered rhodium mineralisation at its Norseman project in Western Australia.
It was a strong session on Wall Street, with the Dow Jones and the S&P500 closing their best weeks since November 2020. The Dow gained 575 points, up nearly 1.8%. The S&P500 rallied 2.5% higher. And the tech-heavy Nasdaq outperformed, ending the day 3.3% higher, boosted by strong earnings from software companies, as well as a fall in the 10-year Treasury yield.
What to watch today:
- The ASX200 is set to open higher. The SPI futures are suggesting a strong lift of 1.15% at the open this morning.
- In commodities, oil is trading around US$115 per barrel, amid persistent concerns of tighter global supplies and increasing demand. So watch producers such as Santos (ASX:STO) and Woodside, which recently changed its ticker code to (ASX:WDS). Gold is also trading higher, benefiting from recent weakness in the US dollar. And iron ore has also rallied to an almost three-week peak.
- Watch AGL Energy (ASX:AGL)’s share price movements, as there has been some speculation that the company has dropped its demerger plans. We’re expecting an announcement from AGL’s CEO sometime today.
- Companies that are set to go ex-dividend today are Coronado Global Resources (ASX:CRN) and Elders (ASX:ELD). So, this often sees shares fall, as investors take their profits.
- Link Administration (ASX:LNK) will hold its AGM today.
Trading Ideas:
- Bell Potter maintain their Buy rating on EROAD (ASX:ERD) and have lowered their price target from $5 to $3.40, as well as reduced their underlying EPS estimates, accounting the higher corporate costs and lower FY23 estimated EBIT guidance. ERD last closed at $2.40, implying 41.7% share price growth in a year.
- Trading Central have identified a bullish signal in Qantas (ASX:QAN), indicating that the stock price may rise from the close of $5.46, to the range of $6.10 to $6.30 over 17 days, according to the standard principles of technical analysis.
The Aussie share market declined 0.6% this week (Mon-Thu), with only the materials and financials sectors managing to post gains.
In this week’s wrap, Sophia covers:
- (0:17) Bell Potter & Citi's ratings on the major banks
- (2:06) Why Appen (ASX:APX) has crashed today
- (2:39) The most traded stocks & ETFs by Bell Direct clients
- (3:13) Four economic news item to watch out for
Yesterday, the ASX200 managed to lift 0.4% or 26 points higher to close at 7,155 points, despite the threat of rising interest rates and inflationary pressures again leading to a heavy tech sell-off.
Consumer staples stocks led the way, with the sector lifting 1.5%. Financials also performed well with all four of the big banks posting gains of over 1%. While, the worst performing sector was the tech sector, which fell about 3%.
The best performer yesterday was Australia’s largest horticultural company, Costa Group Holdings (ASX:CGC) which closed 8.6% higher. This followed its shareholders receiving a cautiously optimistic outlook for the 2022 financial year in its AGM yesterday. CGC expects its earnings to be $5 million higher this year while its after tax profit is predicted to fall $6.4 million. Other stocks that posted gains included Nufarm (ASX:NUF), Perseus Mining (ASX:PRU) and Orica (ASX:ORI). Meanwhile, Chalice Mining (ASX:CHC), City Chic Collective (ASX:CCX) and Pro Medicus (ASX:PME), all posted losses of around 6%.
The most traded stocks by Bell Direct clients yesterday, they included BHP Group (ASX:BHP), Lake Resources (ASX:LKE), Bank of Queensland (ASX:BOQ) and BrainChip (ASX:BRN).
Moving to the US, all three benchmarks closed higher. The Dow closed 0.6% higher, the S&P500 up 1% and the Nasdaq pushed 1.5% higher. The minutes of the Federal Reserve’s May meeting were released, and they showed that the central bank is prepared to raise rates further than the market had anticipated.
What to watch today:
- Following the positive session in the US, the SPI futures are suggesting that our local market is set to open 0.2% higher this morning.
- Reporting wise, iron ore miner, Champion Iron (ASX:CIA) is set to release its full-year results today. Goldman Sachs is expected CIA to report both revenue and EBITDA increases of 14% and 12.8% respectively over the prior corresponding period.
- Moving to commodities:
- The oil price lifted 1% to US$110 a barrel. Natural gas surged to above $9, its highest level since 2008, as inventories stay low.
- The gold price fell as the US dollar strengthened after the minutes of the Federal Reserve’s May meeting.
- The spot iron ore price is trading 1.5% lower at US$130 a tonne.
- One company debuting on the ASX today is TG Metals. The company is pursuing nickel, lithium and gold exploration and development opportunities in Western Australia. It will be trading under the ticker code TG6.
- A few companies going ex-dividend today include Aristocrat Leisure (ASX:ALL), James Hardie Industries (ASX:JHX) and Nufarm (ASX:NUF).
- If you hold Bank of Queensland (ASX:BOQ), you will receive your dividend payment today.
Trading Ideas:
- Citi have maintained its Buy rating on Bank of Queensland (ASX:BOQ) but have reduced its price target from $10.25 to $9.25. At its current share price of $7.52, this implies 23% share price growth in a year.
- Trading Central has a bearish signal on BHP Group (ASX:BHP) indicating that the stock price may fall from the close of $43.02 to the range of $33.50 - $35.25 in the next 89 days according to standard principals of technical analysis.
The local market fell 0.3% or 20 points lower yesterday to close at 7,128 points.
The tech sector came under quite a bit of pressure, falling 3% after US tech stock Snapchat, plunged in after-hours trading. We’ll touch on Snapchat in just a bit. The rest of the sectors closed in the red, except for the real estate and financial sectors, both closing around 0.3% higher, with all four of the big banks closing higher.
Some of the best performers yesterday included Allkem (ASX:AKE), Pilbara Minerals (ASX:PLS) and Liontown Resources (ASX:LTR), all benefitting amid optimism that lithium demand will continue to outstrip supply for some time to come. While the worst performers included Nufarm (ASX:NUF), Imugene (ASX:IMU) and City Chic Collective (ASX:CCX).
The most traded stocks by Bell Direct clients yesterday, they included Grange Resources (ASX:GRR), which rose 5.6% yesterday, following the strength in the iron ore price. Also highly traded was Lake Resources (ASX:LKE), BHP Group (ASX:BHP) and Commonwealth Bank (ASX:CBA).
Moving to the US, the market was mixed. The Dow Jones managed to claw back its early losses and rally into the close, boosted by UnitedHealth Group, as well as McDonald’s, Verizon, and IBM. While the S&P500 fell 0.8% and the Nasdaq dropped over 2% after Snapchat plummeted 43%. The social media company’s shares fell as it warned that it was bracing to miss its earnings and revenue targets in the current quarter. So this led to other tech companies, like Meta, Alphabet, Amazon, and Apple leading the day’s losses as investors feared a slowdown in digital advertising.
What to watch today:
- Following the mixed session in the US, the SPI futures are suggesting that our local market is set to open 0.1% higher this morning.
- Reporting wise, ALS (ASX:ALQ) and Fisher & Paykel Healthcare (ASX:FPH) will be releasing their full-year results and dividend today.
- Moving to commodities, the oil price traded flat as tight supply worries offset concerns over a possible recession and China’s COVID-19 curbs. The gold price gained as the US dollar fell, therefore boosting the safe-haven asset’s appeal. And the spot iron ore price trading 4.8% higher to US$132 a tonne.
- One company debuting on the ASX today is Bellavista Resources. Bellavista is a mineral exploration company, targeting large, high-grade base metal and battery mineral deposits in WA. It will be trading under the ticker code BVR.
- Alumina (ASX:AWC) and Costa Group Holdings (ASX:CGC) are holding their AGMs today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on software company, TechnologyOne (ASX:TNE) with an increased price target from $12.50 to $12.75. TNE provided financial year 2022 guidance of 10-15% profit after tax growth, as expected. The company also said it expects SaaS or Software as a Service annual recurring revenue growth for the full year to be more than 40%, with initial licence fees to be down from financial year 2021. At its current share price of $10.24 this implies about 25% share price growth in a year.
- Trading Central has a bullish signal on lithium business, Liontown Resources (ASX:LTR) indicating that the stock price may rise from the close of $1.33 to the range of $1.54 - $1.60 in the next 22 days according to standard principals of technical analysis.
The local market closed with little change yesterday, amid reviving fears about China’s economic growth now that there are rising COVID-19 cases in Beijing. Locally, materials and technology shares advanced the most, while utilities, financials and consumer staples declined.
On the ASX200 leaderboard, Codan (ASX:CDA) was the best performer after releasing its FY22 guidance. The company expects to match its first-half profit in the second half. If this is achieved, Codan will hit a record full-year profit of $100 million, which would be an 56% increase year-on-year. Meanwhile Polynovo (ASX:PNV), NOVONIX (ASX:NVX) and Incitec Pivot (ASX:IPL) dropped the most.
The most traded stocks by Bell Direct clients yesterday were Lake Resources (ASX:LKE), APA Group (ASX:APA), BHP Group (ASX:BHP) and CSL Limited (ASX:CSL).
In New York there was a bank-led rally saw the Dow Jones rebound more than 600 points, closing 1.98% higher, following a week of sharp losses. The S&P500 closed with a gain of 1.86% and the tech-heavy Nasdaq gained 1.59%.
What to watch today:
- Following US equities, the Australia share market is set to rise 0.27% at the open this morning.
- In commodities, the price of oil is trading lower as worries of a recession offset expectations of higher fuel demand over in the US. Gasoline demand in the US has remained at record levels, ahead of Memorial Day weekend, the peak driving season in the US. The price of gold reached its highest in two weeks, lifted by a weaker US dollar. Meanwhile, iron ore prices have risen higher.
- Today watch Technology One (ASX:TNE), which is set to report its earnings results today.
- Viva Energy Group (ASX:VEA) will hold its AGM today.
- Amcor (ASX:AMC) and GQG Partners (ASX:QGQ) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have upgraded their recommendation on AFT Pharmaceuticals (ASX:AFP) from a Hold to a Buy, after the company reports its FY23 result yesterday. The price target has remained unchanged at $4.80 and AFP’s currently share price is $3.20, which implies 50% share price growth in a year.
- Trading Central have identified a bearish signal in PM Capital Opportunities Fund (ASX:PGF), indicating at the stock price may fall from the close of $1.58 to the range of $1.44 to $1.46 over 11 days, according to the standard principles of technical analysis.
Over the week the ASX200 gained 1%, with the tech sector in the lead, up 5% week-to-date.On Friday the market gained 1.15%, with most sectors in the green. Only energy and real estate stocks finished lower.
The standout stock on Friday was Chalice Mining (ASX:CHN), jumping 19%.The company received a new set of exploration approvals to expand its existing WA nickel projects. Following this, Bell Potter retained their Speculative Buy rating on CHN with a $12.02 price target. At its current share price of $6.81, this implies 76.5% share price growth in a year. Following CHN on the leaderboard were tech stocks, recovering from prior losses. These included family app Life360 (ASX:360), battery materials and tech company NOVONIX (ASX:NVX) and Afterpay’s parent company Block (ASX:SQ2). Meanwhile Nufarm (ASX:NUF) and Woodside Petroleum (ASX:WPL) declined the most.
The most traded stocks by Bell Direct clients on Friday were Lake Resources (ASX:LKE), CSL (ASX:CSL), BHP Group (ASX:BHP) and BrainChip Holdings (ASX:BRN).
In US equities, the Dow fell for the 8th straight week amid a broader market sell-off. The Dow and the S&P500 both closed flat, while the Nasdaq saw its 7th negative week in a row for the first time since March 2001 and also saw its lowest intraday level since November 2020 on Friday.
What to watch today:
- The SPI futures are suggesting the Australian market will fall 0.21% at the open this morning.
- In commodities, the oil price is trading lower, as we wait for news on the potential EU ban on Russian oil. Oil demand however is expected to rebound in China, as authorities in Shanghai lifted some COVID restrictions. Meanwhile gold is trading flat, while seaborne iron ore is in the green.
- And two companies reporting their earnings results today are Elders (ASX:ELD) and Incitec Pivot (ASX:IPL). So, keep watch of their share price movements today.
Trading Ideas:
- Bell Potter maintain their Buy rating on Select Harvests (ASX:SHV) and have lowered their price target from $7.40 to $6.95. SHV last closed at $5.99, implying 16% share price growth in a year.
- Trading Central have identified a bullish signal in The a2 Milk Company, indicating that the stock price may rise from the close of $4.28 to the range of $4.65 to $4.75 over 30 days, according to the standard principles of technical analysis.
The Aussie share market fell 0.15% this week (Mon-Thu), with industry sectors mixed. The consumer staples sector took the biggest hit, down 3.6%, while the tech sector managed to gain 0.5% after suffering major losses recently.
In this week’s wrap, Sophia covers:
- (0:48) The wage price spiral
- (1:50) Why biotech company Imugene (ASX:IMU) gained the most
- (2:39) A stock to consider if you want to buy into tech
- (3:03) Infomedia (ASX:IFM) jumping 29% after acquisition proposal
- (4:10) The most traded stocks & ETFs by Bell Direct clients
- (4:46) One economic news item to watch out for
The local market jumped 1% or 70 points higher yesterday to close at 7,182 points.
Sectors wise, the majority of the industry sectors were in the green, with the materials and tech sectors rallying the most. Meanwhile, the consumer staples sector declined 1% and the financial sector experienced a bit of pressure with three of the big banks, CBA, WBC and NAB declining.
The best performer was Champion Iron (ASX:CIA) which lifted 5.3% after signing a deal to acquire an iron ore pelletizing facility for $2.7 million. Subject to positive findings, a joint venture may be formed to produce iron ore pellets for sale to third parties, including the feasibility partner. Travel stocks like Corporate Travel Management (ASX:CTD) and Flight Centre (ASX:FLT) performed well, despite no news from either company. What seems to have supported their gains was many international travel stocks taking off, with the rise seemingly spurred by Nasdaq-listed United Airlines Holdings(UAL), who upgraded their guidance. Meanwhile, the worst performers yesterday were PolyNovo (ASX:PNV), Sims (ASX:SGM) and Eagers Automotive (ASX:APE).
The most traded stocks by Bell Direct clients included Fortescue Metals (ASX:FMG), Champion Iron (ASX:CIA) and Sims (ASX:SGM).
Moving to the US, stocks fell sharply, as earnings from big retailers Target and Walmart renewed fears of rising inflation. Target shares slumped 25% after its first-quarter earnings were much lower than estimated due to higher fuel and compensation costs. And Walmart, who posted earnings on Tuesday also posted earnings that fell short of expectations, citing higher fuel and labour costs. This saw the Dow Jones post its biggest loss since 2020, falling over 1,100 points. The S&P500 dropped over 4%, its worst drop since June 2020 and the tech-heavy Nasdaq index slipped 4.7%.
What to watch today:
- Following the sell-off in the US, the SPI futures are suggesting that our local market is set to open 1.8% lower this morning.
- Reporting wise, both Aristocrat Leisure (ASX:ALL) and Nufarm (ASX:NUF) will release their half-year results. We’ll also hear from Webjet (ASX:WEB). The travel company will share its full-year results. So, keep watch of those three stocks.
- Economic news wise, all eyes will be on the unemployment rate for April that will be announced at 11:30am AEST. Consensus forecasts suggest the Aussie economy may have added between 25,000-30,000 jobs last month, and if that data comes in as expected, the nation’s official unemployment rate could drop to 3.9%, setting a multi-decade low in the process.
- Moving to commodities:
- The oil price dropped 2% to US$109 a barrel, after government data showed US refiners had ramped up output, which eased worries of a supply crunch.
- The gold price lifted slightly, as a slide in US Treasury yields helped offset pressure from a firmer dollar.
- Other metals like silver, copper and platinum all declined between 1-2%.
- The spot iron ore price trading about 1.6% lower to US$125 a tonne.
- Stocks going ex-dividend today include Westpac (ASX:WBC), Pendal Group (ASX:PDL) and Virgin Money UK (ASX:VUK). This often results in the company’s share price falling, as investors take their profits.
- And finally, Adbri (ASX:ABC), Gold Road Resources (ASX:GOR) and Woodside Petroleum (ASX:WPL) are holding their AGMs today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on Eagers Automotive (ASX:APE) albeit with a reduced price target from $17.25 to $15.50. APE released a trading update and provided first-half 2022 guidance, which was in line with Bell Potter’s expectations. The company noted that demand for new vehicles continues to materially exceed supply and as a result the new car order book has increased by more than 25% since the end of December last year. A
The local market yesterday closed with a gain of 0.27%. Energy stocks lead the ASX200, up more than 2% at the close, as oil prices rallied in response to Shanghai’s reopening, and as investors await developments around a proposed EU ban on Russian oil. Utilities and materials also closed in positive territory, as did the financials, with the major banks all higher.
The 10 best performing stocks on the ASX200 yesterday included energy stocks like Beach Energy (ASX:BPT) and Whitehaven Coal (ASX:WHC), both gaining around 6%. The best performer yesterday was Lynas Rare Earths (ASX:LYC), its share price seeing some recovery this week, after last week falling to a year-to-date low of $8.37, however is now trading at $9.42. This was despite no news from the company that would be price sensitive. However, yesterday the materials index closed just over 1% higher, which boosted LYC’s share price. Meanwhile, logistics company, Brambles (ASX:BXB), was the worst performing stock on Tuesday after confirming they’ll not be moving forward with the proposal from private equity company CVC Capital Partners, which sent BXB’s shares into reverse. Shareholders took their profits as BXB fell 8% yesterday.
The most traded stocks by Bell Direct clients yesterday included Whitehaven Coal (ASX:WHC), Lynas Rare Earths (ASX:LYC), Lake Resources (ASX:LKE), BHP Group (ASX:BHP) and Westpac (ASX:WBC).
It was a strong trading session in New York overnight, as US equities were in positive territory. The Dow Jones up 1.3%, the S&P500 up 2% and the Nasdaq rallying 2.8%.
What to watch today:
- Following US equities, the ASX200 is set to rise, with the SPI futures suggesting the market will lift 0.98% at the open this morning.
- In commodities, oil is currently trading flat. There are hopes that Venezuela could supply more oil to the market, after the US extended a limited license for Chevron, which is an oil company that operates in Venezuela, allowing them to maintain operations. There have also been negotiations for future business, temporarily lifting a ban on such discussions. Additionally, a pullback in the US dollar supported bullion demand, but the gold price is slightly lower, while seaborne iron ore is also trading in the red.
- In economic data, today the wage price index for the first quarter will be released at 11:30am AEST, expected to rise to 2.5% year-over-year from 2.3% in Q4 2021.
- Watch Eagers Automotive (ASX:APE) and Telix Pharmaceuticals (ASX:TLX) as both companies will hold their AGMs today.
- Watch Aurora Energy Metals (ASX:1AE) as it lists on the ASX today.
Trading Ideas:
- Bell Potter maintain their Buy rating on Pendal Group (ASX:PDL), following a strong set of H1 results that were ahead of Bell Potter’s expectations. Bell Potter have increased their FY22 estimates due to the strong revenue and lower costs and have increased their price target to $6.80. PDL last closed at $5.08, implying 35.8% share price growth in a year.
- Trading Central have identified a bullish signal in Emerald Resources (ASX:EMR), indicating that the stock price may rise from the close of $1.12 to the range of $1.33 to $1.39 over 20 days, according to the standard principles of technical analysis.
Yesterday the market was up as much as 1% in the first hour of the session, following a strong trading session over on Wall Street, and soon after that the market started to drop, following weak economic data from China. China’s April retail sales dropped 11.1% on the year, when the market was expecting a 6% drop, so it fell almost twice the forecast. Additionally, the unemployment rate in China rose to 6.1%.
Locally, the Australian market dropped but still managed to close with a 0.25% gain. Leading the ASX200 was transport and logistics company Brambles (ASX:BXB), which gained over 11% yesterday to its highest price in 8 months. This was after news of a potential takeover offer by private equity group CVC for $20 billion. Meanwhile, Imugene (ASX:IMU), City Chic Collective (ASX:CCX), and Zip (ASX:ZIP) declined the most.
Bell Direct clients were trading mostly ETFs yesterday, including VAF, VEU and EMKT.
It was a volatile session overnight in the US. The Dow Jones closed with a slight gain of 0.08%, while the S&P500 dropped 0.39%. The Nasdaq was the session’s underperformer, as tech stocks continue to fall, closing 1.2% lower.
What to watch today:
- The SPI futures are suggesting the local market will rise 0.32% at the open this morning.
- In economic news, today we’ll receive the RBA’s meeting minutes, at 11:30am AEST. These are the minutes from the central bank’s meeting earlier this month and it may draw some attention, as this was the meeting when the RBA lifted the cash rate.
- In commodities, the oil price has jumped again as concerns of tighter global supplies outweighed the weakening global demand outlook. Gold and seaborne iron ore are also trading higher.
- James Hardie Industries (ASX:JHX) is set to release its quarterly earnings.
Trading Ideas:
- Citi has a Buy rating on Brambles (ASX:BXB) with a $12.29 price target. Citi say that compared to traditional leveraged buyout targets, BXB has little excess assets on its balance sheet, and CVC (who are the private equity group proposing the takeover bid) see the market as undervaluing the operating business and complex strategic initiatives over the medium term.
- Trading Central have identified a bearish signal in Metcash (ASX:MTS), indicating that the stock price may fall from the close of $4.63 to the range of $4.40 to $4.44 over 19 days according to the standard principles of technical analysis.
Before we jump into today’s session, let’s have a quick look at what happened in last Friday’s session. The local market surged 1.9%, and despite this being the strongest lift we’ve seen since late January, it wasn’t enough to recover Thursday’s losses, with the market still closing 1.8% lower last week.
Sectors wise, all the industry sectors were in the green. The tech sector rallied the most, up 7%, and this follows the Nasdaq closing in the green during its Thursday session and a stronger-than-expected result from BNPL company Affirm, which lifted 23% aftermarket.
The best performers were mainly tech stocks. Afterpay-parent Block (ASX:SQ2) led the way, rising 15%, followed by Life360 (ASX:360) which rose 14.3% and PolyNovo (ASX:PNV) which lifted 14%. On the flip side, gold miners like Gold Road Resources (ASX:GOR), Evolution Mining (ASX:EVN) and Newcrest Mining (ASX:NCM) struggled on Friday, after the gold price tumbled.
The most traded stocks by Bell Direct clients last Friday included Macquarie Group (ASX:MQG), CSL (ASX:CSL) and BHP Group (ASX:BHP).
Moving to the US, stocks also jumped higher, helping prevent the S&P500 from tumbling into bear market territory. The Dow rose over 400 points, the S&P500 lifted 2.4% and the Nasdaq surged 3.8%. Despite Friday’s gains, the major averages posted losses for the week.
What to watch today:
- Following the positive session in the US, the SPI futures are suggesting that our local market is set to open 0.8% higher this morning.
- A company to watch today is Goodman Group (ASX:GMG), as the industrial property company is set to release its third quarter update, with the market looking for an upgrade to its guidance, as many brokers believe GMG will outperform its provided FY22 EPS growth of 20%.
- Moving to commodities:
- The oil price lifted about 4% on Friday to US$110 a barrel as US gasoline prices jumped to a record high and China seemed likely to ease its pandemic restrictions.
- The gold price fell more than 1%, following the dollar’s strong run and more aggressive US interest rates on the horizon.
- The spot iron ore price traded about 1.2% higher to US$124 a tonne.
- One new company debuting on the ASX today is natural resources company, Southern Cross Gold. It will be trading under the ticker code SXG.
- Dicker Data (ASX:DDR), Macquarie Group (ASX:MQG) and Autosports Holding (ASX:ASG) are set to go ex-dividend today.
Trading Ideas:
- Citi have initiated coverage on Australian retailer, Universal Store Holdings (ASX:UNI) with a Buy rating and price target of $5.83. Citi sees the company having multiple medium-term growth drivers, including increased store rollout, margin expansion opportunities, as well as increased private brand penetration and direct sourcing. At its current share price of $4.50 this implies about 30% share price growth in a year.
- Trading Central has a bullish signal on aerial imagery technology company, Nearmap (ASX:NEA) indicating that the stock price may rise from the close of $1.20 to the range of $1.49 - $1.57 in the next 17 days according to standard principals of technical analysis.
The Aussie share market declined 3.7% this week (Mon-Thu), with all the industry sectors in the red as rates, war, inflation, and an upcoming election give investors plenty to think about.
In this week’s wrap, Sophia covers:
- (0:38) Block (ASX:SQ2) falling 30%
- (1:00) Why the tech sector crashed
- (1:46) Seven tech stocks Bell Potter has a buy rating on
- (2:25) The best and worst performing stocks in the All Ords
- (2:45) The most traded stocks & ETFs by Bell Direct clients
- (3:20) One economic news item to watch
The Aussie share market managed to post a small gain of 0.2%, snapping its three-day losing streak. Aussie investors digested the latest consumer confidence data from Westpac showing that confidence was down 5.6% to 90.4 points in May, the measure's lowest level since August 2020, when COVID lockdowns were hitting Victoria.
So how did the overall market perform? The majority of the industry sectors were in the green. The healthcare sector led the pack, but it was the financial sector that did come under a bit of pressure, weighed down by a 3.9% drop in NAB’s share price, after the stock traded ex-dividend yesterday.
The best performer was Lifestyle Communities (ASX:LIC), up an impressive 15.1%. This followed some insider buying and a bullish note out by Goldman Sachs, where the broker reiterated its buy rating and $24.65 price target. Other top stocks include City Chic Collective (ASX:CCX) and Life360 (ASX:360). On the other hand, Link Administration (ASX:LNK) closed 15.1% lower to $4.22. During the trading session, the company requested a trading halt, after its shares sank 12%. The company then responded to the ASX query and noted that it was not aware of any material information about its proposed acquisition by Dye & Durham and weren’t aware of any reason for the decline in its share price and elevated trading volumes yesterday.
The most traded stocks by Bell Direct clients yesterday included Macquarie Group (ASX:MQG), Westpac (ASX:WBC) and Galileo Mining (ASX:GAL).
Moving to the US, all three benchmarks closed in the red. The Dow Jones fell over 300 points, the S&P500 down 1.7% and the Nasdaq dropped 3.2%. This comes as investors digested the latest US inflation data. April’s CPI showed an 8.3% jump, which was higher than the 8.1% increase expected by economists polled by the Dow Jones. Now with the annual rate ticking down from 8.5% to 8.3%, it’s still unclear if we’ve seen the peak. Some believe the data could be sign that the Fed is behind the curve in curbing inflation. And following the data release, the 10-year Treasury yield briefly jumped above the 3% mark, however settled at 2.9%.
What to watch today:
- Following the negative session over in the US, the SPI futures are suggesting that the market is set to open 0.5% lower.
- This morning, Commonwealth Bank (ASX:CBA) will deliver its third-quarter trading update.
- Other companies reporting today include mining and infrastructure solutions provider, Orica (ASX:ORI) who will be releasing its half-year profit and announcing its interim dividend. And cloud-based accounting software business, Xero (ASX:XRO) will today be releasing its full-year results.
- Moving to commodities, the oil price traded higher off the back of supply concerns as flows of Russian gas to Europe fell. The gold price lifted as the US dollar retreated following the latest US inflation data release. And the spot iron ore price traded lower and is sitting at around US$123 a tonne.
- If you’re a shareholder of Myer Holdings (ASX:MYR), you will receive your fully franked interim dividend of 1.5 cents per share today.
- Tabcorp (ASX:TAH), Ampol (ASX:ALD) and Sigma Healthcare (ASX:SIG) are holding their AGMs today.
Trading Ideas:
- Citi have maintained its Buy rating on Ardent Leisure (ASX:ALG) with a price target of $1.96. At its current share price of $1.20, this implies about 63% share price growth in a year.
- Trading Central has a bullish signal on medical device company, PolyNovo (ASX:PNV) indicating that the stock price may rise from the close of $1.12 to the range of $1.54 - $1.64 in the next 79 days according to standard principals of technical analysis.
The major mining stocks lead the market’s losses yesterday and the market lost 1%, following a fall in commodity prices and doubts about Chinese growth, in its push to achieve its zero COVID strategy. Shanghai’s lockdown has been reinstated with some stricter rules, including the ban of food delivery services. Locally, materials, energy and utilities were down the most yesterday.
Looking at the ASX200 leaderboard, insurance company AUB Group (ASX:AUB) declined the most yesterday after news that the company is set to acquire UK insurance broker Tysers for $880 million. And with the fall in commodities, mining stocks fell, including Chalice Mining (ASX:CHN), Paladin Energy (ASX:PDN), Rio Tinto (ASX:RIO), De Grey Mining (ASX:DEG) and Newcrest Mining (ASX:NCM) to name a few. Pendal (ASX:PDL) surged more than 8% after reporting underlying earnings 22% above market consensus, and PolyNovo (ASX:PNV) gained 16% amid news of more insider buying.
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), Macquarie Group (ASX:MQG), BHP Group (ASX:BHP), Westpac (ASX:WBC) and Rio Tinto (ASX:RIO).
In US equities, the major benchmarks closed mixed ahead of the release of the US inflation reading. Tonight, April’s consumer price index will be announced in the US, expected to rise 0.2% from the month prior and 8.1% year over year, according to the Dow Jones consensus estimate. The Dow Jones fell for the fourth consecutive day, down about 35 points, while the S&P500 edged 0.25% higher. The Nasdaq gained 1%, with a rebound in some mega-cap technology stocks leading the gains, including Microsoft and Apple which gained 1% each.
What to watch today:
- The Australian market is set to slightly fall at the open this morning, with the SPI futures suggesting a drop of 0.1%, after a mixed night in the US.
- Follow price movements of technology stocks today. Tech stocks crashed in the Chinese market, however performed well over in the US. A trading idea to consider is Technology One (ASX:TNE), which Bell Potter have retained their Buy rating on, with a lower price target of $12.50 from $14. On the 24th of May, TNE will report its half-year earnings, and Bell Potter expect TNE to report recurring revenue growth of 38%.
- Watch lithium developer AVZ Minerals (ASX:AVZ), which is due to return from a trading halt this morning.
- In commodities, oil prices have fallen again, trading 3.5% lower. Gold also remains under pressure from a strong US dollar. And seaborne iron ore is over 1% lower.
- In economic data, Westpac’s consumer confidence index for May will be released today. This will give us an indication of how consumers are feeling this month. Last month, consumer sentiment fell by 0.9%, and is expected to fall 1% this month.
- Other companies reporting their earnings today are CSR Limited (ASX:CSR) and GrainCorp (ASX:GNC).
- GPT Group (ASX:GPT), Smart Group Corporation (ASX:SIQ) and Unibail-Rodamco-Westfield (ASX:URW) will hold their AGMs today.
Trading Ideas:
- Bell Potter maintain their BUY rating on Coronado Global Resources (ASX:CRN), and expect the company to generate strong free cash flow on their met coal price outlook. The price target has been lowered to $2.50, and CRN’s last share price was $2.17, implying 15.2% share price growth in a year.
- Trading Central have identified a bullish signal in Sezzle (ASX:SZL), indicating that the stock price may rise from the close of $0.85 to the range of $1.01 to $1.05, over 21 days according to the standard principles of technical analysis.
Yesterday, the Aussie share market started the new trading week extending its losses from the previous trading session.
The benchmark S&P/ASX200 index slipped 1.2%, reaching its lowest level since mid-March. It comes as China intensifies its zero-COVID policy, which in turn has deepened the supply chain crisis. Looking at the sector performances, the market was broadly sold off, with both the real estate and tech sectors posting the biggest losses. The energy, consumer staples and healthcare sectors did however manage to all close slightly higher.
The best performer yesterday was once again medical device company, PolyNovo (ASX:PNV), in part due to its directors toping up on PNV shares, however it also seems investors are taking advantage of its share price weakness to purchase more shares. Meanwhile, the worst performers included NOVONIX (ASX:NVX), Imugene (ASX:IMU) and Magellan Financial Group (ASX:MFG). Investors are continuing to sell Imugene shares, following the termination of its supply agreement with Merck.
The most traded stocks by Bell Direct clients yesterday included Fortescue Metals Group (ASX:FMG), ANZ (ASX:ANZ) and Macquarie Group (ASX:MQG).
In the US, the sell-off continued with all three benchmarks coming under pressure. The Dow Jones fell more than 600 points, the S&P500 down 3.2% and the Nasdaq slipped 4.3%. All sectors were in the red, apart from the consumer staples sector. Amid the losses, the benchmark 10-year Treasury yield hit its highest level since late 2018, trading well above 3%, which continued to crush tech names like Meta, Alphabet, Netflix, and Apple.
What to watch today:
- If you go by the SPI futures, the market is set to open 1.39% lower.
- Reporting wise, capital market business, Pendal Group (ASX:PDL) will be releasing its half-year results today.
- Economic news wise, business confidence for April will be announced today. Business confidence currently stands at a five-month high of 16 points, however April’s reading is forecasted to fall to 12 points.
- Moving to commodities, the oil price tumbled around 6% as China’s lockdowns weigh on demand outlook. The gold price extended its decline to fall more than 1% on Monday, as the US dollar pushed to near two-decade highs. And the spot iron ore price has fallen about 4%, trading at $US136 a tonne.
- Private toll road developer, Atlas Arteria (ASX:ALX) is holding its AGM today.
Trading Ideas:
- Citi have maintained its Buy rating on Domino’s Pizza (ASX:DMP) with a price target of $108.42. At its current share price $67.60, this implies about 60% share price growth in a year.
- Trading Central has a bearish signal on Northern Star Resources (ASX:NST) indicating that the stock price may fall from the close of $9.06 to the range of $7.10 - $7.50 in the next 35 days according to standard principals of technical analysis.
Last week concerns around aggressive monetary tightening by central banks saw markets sharply decline. Week-to-date the Australian market closed just over 3% lower, with all sectors lower.
On Friday the market closed 2.2% lower, its worst trading session since February. Again, a broad based sell off ended with all sectors in the red. Tech and property shares declined the most.
Paladin Energy (ASX:PDN), Life360 (ASX:360) and Xero (ASX:XRO) were the worst performers. Stocks that managed to make slight gains included ResMed (ASX:RMD), Wesfarmers (ASX:WES), Mineral Resources (ASX:MIN), Costa Group (ASX:CGC), Cromwell Property Group (ASX:CMW), Amcor (ASX:AMC) and Medibank (ASX:MPL). PolyNovo (ASX:PNV) managed to gain 4%, following news that its chairman and non-executive director bought 500,000 and 100,000 shares in the company respectively.
The most traded stocks by Bell Direct clients on Friday were Macquarie Group (ASX:MQG), Lake Resources (ASX:LKE), the Vanguard Australian Shares ETF (ASX:VAS), BHP Group (ASX:BHP) and CSL (ASX:CSL).
In New York, stocks further declined, extending the week’s losses. The Dow Jones closed 0.3% lower, the S&P500 down 0.6%, while the Nasdaq closed 1.4% lower.
What to watch today:
- The SPI futures are suggesting the Australian share market will fall 0.7% at the open this morning.
- In commodities, the price of oil is trading higher, amid concerns of tight global supply, ahead of the EU’s impending embargo on Russian oil. The gold price is higher, after coming under pressure last week. And iron ore has dropped, with seaborne iron ore trading 5% lower. So, watch iron ore stocks today such as Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG), Champion Iron (ASX:CIA) and Mineral Resources (ASX:MIN).
- Watch Westpac (ASX:WBC)’s share price movements today. This morning Westpac released its half year earnings, reporting first half of 2022 statutory net profit, up 63% compared to the second half of 2021 and down 5% compared to the first half of 2021. And a fully franked interim dividend of 61 cents per share.
- If you hold Metrics Income Opportunities Trust (ASX:MOT) you can expect to receive your dividend payment today.
Trading Ideas:
- Bell Potter maintain their BUY rating on Life360 (ASX:360), with a 9% decrease to their price target to $7.50, which is still over 100% premium to the share price.
- Trading Central have identified a bearish signal in Bravura Solutions (ASX:BVS), indicating that the stock price may fall from the close of $1.66 to the range of $1.40 to $1.44, over 17 days, according to the standard principles of technical analysis.
The Aussie share market came under pressure this week, as central banks started to act on taming inflation and normalising monetary conditions.
In this week’s wrap, Sophia covers:
- (1:40) Why Imugene (ASX:IMU) tumbled
- (1:52) The best and worst performing stocks in the All Ords
- (2:11) The most traded stocks by Bell Direct clients
- (2:40) Big Aussie banks reporting earnings
- (4:20) Three economic news items to watch out for
Yesterday, the Aussie share market declined 0.2%, which means the market is now tracking 1.8% lower this week.
Looking at the sector performances, the market was mixed. Notably, the real estate sector fell 1.5%, its lowest level in almost two months as investors began to factor in higher borrowing costs for property companies with interest rates rising.
The best performers included HUB24 (ASX:HUB), Orora (ASX:ORA) and Virgin Money UK (ASX:VUK), all closing over 3% higher. While on the flip side, AVZ Minerals (ASX:AVZ) fell 19% after news that the company threatened legal action against a transfer of shares in Dathcom (which is a company AVZ holds a large stake in). Also declining yesterday were tech shares like Zip (ASX:ZIP), NOVONIX (ASX:NVX) and Tyro Payments (ASX:TYR).
The most traded stocks by Bell Direct clients yesterday included Flight Centre (ASX:FLT), Commonwealth Bank (ASX:CBA) and Firefinch (ASX:FFX).
It was a big trading session over in the US. The Dow and S&P500 saw their biggest daily gains since 2020. The Dow rose more than 900 points, the S&P500 was up nearly 3% and the Nasdaq lifted an impressive 3.2%. As expected, the central bank announced a 50 basis point increase, or 0.5% increase in the benchmark interest rate, its biggest rate increase since 2000. And the Fed noted that it would also start reducing its balance sheet in June.
What to watch today:
- The SPI futures are suggesting the market is set to open 0.43% higher.
- Reporting wise, National Australia Bank (ASX:NAB) is one to watch today, as the banking giant has released its half-year results this morning.
- Other companies releasing results today include Eclipx Group (ASX:ECX) and Virgin Money UK (ASX:VUK).
- Economic news wise, Australia’s balance of trade for March will be released today. That’s the difference between what we export vs. what we import.
- Moving to commodities, the oil price jumped 5% as the European Union spelled out plans to phase out imports of Russian oil. The gold price rose as both the US dollar and US Treasury yields fell following the Federal Reserve chairman Jerome Powell’s comments that inflation was too high, making bullion more appealing.
- If you’re a shareholder of Gold Road Resources (ASX:GOR) or Arena REIT (ASX:ARF) you can expect to receive your dividend payment today. And Vita Group (ASX:VTG) is set to go ex-dividend today.
- Iress (ASX:IRE), Rio Tinto (ASX:RIO) and QBE Insurance Group (ASX:QBE) are holding their AGMs today.
Trading Ideas:
- Citi have maintained its Buy rating on ARB Corp (ASX:ARB) however with a reduced price target, from $48.15 to $46.63. At its current share price $33.61, this implies about 39% share price growth in a year.
- Trading Central has a bearish signal on Shaver Shop Group (ASX:SSG) indicating that the stock price may fall from the close of $1.11 to the range of $0.76 - $0.82 in the next 369 days according to standard principals of technical analysis.
Yesterday the market finished lower for the second straight trading session, down 0.4% or around 30 points. The market was steady yesterday while awaiting the RBA’s interest rate decision. And the central bank raised the cash rate by 25 basis points to 0.35%. The market was waiting to see whether rates would be lifted or if the RBA would hold off for another month, however it was wildly expected that the RBA would lift the cash rate by 15 basis points, so the rise of 25 basis points was greater than market consensus, and it is also the first rate hike in 11 years. Now, inflation has been rising at its fastest pace in 20 years, so the RBA believes it’s an appropriate time to begin the process of normalising monetary conditions, flagging that there is also evidence that wage growth is picking up. Following the announcement, the market had an almost instant reaction, dropping significantly, however the market then lifted again about 30 minutes after the announcement.
Sectors wise, real estate took the biggest hit yesterday, while tech gained the most. These are the two sectors however, that are more likely to pull back, with the cash rate hike.
Looking at the ASX200 leaderboard, Magellan Financial Group (ASX:MFG) was the best performer, gaining 5% after reports that Nikki Thomas, formally a fund manager at MFG, is likely to permanently replace Hamish Douglas as CIO. And the company’s new chief executive is expected to be appointed next month. Tech stocks were also higher yesterday with Zip (ASX:ZIP), Appen (ASX:APX) and Block (ASX:SQ2) taking the lead.
The most traded stocks by Bell Direct clients yesterday included Westpac (ASX:WBC), Scentre Group (ASX:SCG), Pilbara Minerals (ASX:PLS) and Australia and New Zealand Banking Group (ASX:ANZ).
Overseas, European markets finished higher, after closing lower a day earlier, after a sudden “flash crash” in the Sweden’s Stockholm OMX 30 index, which fell 8% at one point, before rising again and regaining most of those losses. There was also weak economic data from China and Germany, however European markets still closed in the green. US equities also closed higher, ahead of the Federal Reserve’s policy decision tonight. It is widely expected that the Fed will tonight raise rates by 50 basis points. The Dow Jones closed up 0.2%, the S&P500 up 0.5% and the Nasdaq up 0.2%.
What to watch today:
- In line with New York, the SPI futures are suggesting the Australian market will rise 0.59% at the open this morning.
- In commodities, oil is trading lower, with a potential ban on Russian oil from the EU. Germany has said they’re willing to support an immediate embargo on Russian oil, as the EU say they plan to tighten sanctions against Russia. Meanwhile the price of gold is higher, while seaborne iron ore is trading flat.
- Watch out for Koba Resources (ASX:KOB) as it lists on the ASX today.
- Also keep watch of ANZ, the bank is set to release its half-year results this morning.
- Keep watch of AGL Energy (ASX:AGL) share price movements. Yesterday, tech billionaire Mike Cannon-Brookes acquired an 11% stake in AGL, becoming its largest shareholder. He aims to stop AGL from burning coal, saying he’ll vote against the demerger with Accel Energy.
Trading Ideas:
- Bell Potter maintain their Buy rating on Select Harvests (ASX:SHV) after the company provided updated guidance parameters for FY22. Bell Potter have increased their price target from $6.60 to $7.40. SHV last closed at $6.20, implying 19.4% share price growth in a year.
- Trading Central have identified a bearish signal in Motorcycle Holdings (ASX:MTO), indicating that the stock price may fall from the close of $2.78 to the range of $2.66 to $2.68, over 21 days, according to the standard principles of technical analysis.
Yesterday, the Aussie share market experienced a broad sell off, with the benchmark ASX200 index falling 1.2% to 7,347 points.
Sectors wise, all sectors were in the red. The hardest hit sectors were the tech, real estate, and communication services sectors, which all fell more than 2%.
Looking at the ASX200 leaderboard, corporate bookmaker, PointsBet (ASX:PBH) led the way, advancing 5.7%, after Goldman Sachs retained its buy rating on the stock, with a $5.78 price target. That’s an 80% premium to its current share price. Also performing well were travel stocks Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Webjet (ASX:WEB), which was likely due to Qantas’ trading update, which revealed that domestic travel numbers are rebounding faster than expected. On the other end, Imugene (ASX:IMU) was the worst performing stock, down 13.6% after the biotech company scraped its supply agreement with MSD, which is a tradename of Merck & Co.
The most traded stocks by Bell Direct clients yesterday included the Vanguard Australian Shares Index ETF (ASX:VAS), Lake Resources (ASX:LKE) and Pilbara Minerals (ASX:PLS).
On Wall Street, the benchmarks started the new trading week lower, however by the late afternoon, the Dow, S&P500 and Nasdaq all managed to stage a late comeback to close in positive territory. Volatility in the bond market likely contributed to the swings in stocks. When the 10-year Treasury yield broke through 3%, which it hasn’t done since November 2018, this signalled that the bond market selloff had hit its peak and most likely wouldn’t continue until we get beyond the Fed’s update on Wednesday.
What to watch today:
- Despite the positive close in the US, if you go by the SPI futures, the Aussie share market is set to open 0.34% lower this morning.
- Economic news wise, all eyes will be on the RBA. The Reserve Bank is widely expected to announce a 15 basis point rate increase when it releases a post-policy meeting statement at 2.30pm AEST.
- All eyes will also be on Woolworths (ASX:WOW) as the retail giant is set to release its third quarter sales update.
- In commodities, the oil price reversed its losses, to trade slightly higher, around US$105 a barrel. This was off the back of fears that supply might be impacted by a potential European Union ban on Russian crude. The gold price slumped more than 2%, as increased prospects of faster rate hikes by the Fed Reserve lifted both US Treasury yields and the US dollar. And the spot iron ore price is trading nearly 3% higher at US$142 a tonne.
- There are two new companies debuting on the Aussie share market today. Firstly, share advisory services company, Equity Story Group. It will be trading under the ticker code EQS. And secondly, gold, silver and copper exploration company, Sierra Nevada Gold. Its ticker code SNX.
- If you’re a shareholder of Brickworks (ASX:BKW), you can expect to receive your dividend payment today.
- Both Santos (ASX:STO) and TPG Telecom (ASX:TPG) are holding their AGMs today.
Trading Ideas:
- Bell Potter have maintained its Speculative Buy rating on PointsBet (ASX:PBH) with a slightly reduced valuation, from $7.50 to $6. At its current share price of $3.17, this implies 89% share price growth in a year.
- Trading Central has a bearish signal on Michael Hill (ASX:MHJ) indicating that the stock price may fall from the close of $1.10 to the range of $0.56 - $0.66 in the next 142 days according to standard principals of technical analysis.
Week-to-date the ASX200 closed 0.5% in the red, however on Friday the market rebounded, recovering from the broad sell-off earlier in the week, and closing over 1% higher.
All industry sectors posted gains. Although the tech sector declined the most overall last week, on Friday tech regained some of those losses, and was the best performing sector, managing to lift 2.25% at the close. That was following the tech rally on Wall Street and tech stocks like Zip (ASX:ZIP), Tyro Payments (ASX:TYR), Life360 (ASX:360), Codan (ASX:CDA) and EML Payments (ASX:EML) all advancing.
The top performer on Friday was PointsBet Holdings (ASX:PBH), which lifted 10.7% after reporting a 54% increase in turnover. And Goldman Sachs have retained their buy rating on PBH with a $5.78 price target, so keep watch of its share price today. Meanwhile, the worst performing stocks were Dominos (ASX:DMP), ResMed (ASX:RMD) and Pro Medicus (ASX:PME).
The most traded stocks by Bell Direct clients on Friday, were Aristocrat Leisure (ASX:ALL), Mount Gibson Iron (ASX:MGX) and the Vaneck Emerging Income Opportunities ETF (ASX:EBND).
In global markets, European stocks closed higher after a busy day of earnings results. Meanwhile, Eurozone inflation hit a record high in April, for the sixth month in a row. Annual inflation in Europe reached 7.5%, while GDP grew 5% year-on-year. So, investors are now waiting to see how the European Central Bank will react. Over in the US, there was a broad sell-off on Wall Street, with all three major benchmarks falling. This follows a number of headwinds, including the Fed’s monetary tightening, rising inflation and interest rates, the ongoing concerns around the Ukraine war, and COVID cases in China, which continue to rise – these factors have all played a part. The Dow Jones tumbled more than 900 points, closing 2.8% lower. The S&P500 dropped 3.6%, and the Nasdaq closed more than 4% lower, finishing April with its worst monthly performance since October 2008, down approximately 13% in April overall.
What to watch today:
- Following US equities, the SPI futures are suggesting the local market will fall 1.27% at the open this morning.
- In economic data, ANZ’s data on job advertisements for April will be released today. And today investors will be trading cautiously, with the expectation of an interest rate hike tomorrow when the RBA meets.
- In commodities, oil prices are trading lower, amid supply disruptions and the demand slowdown in China. So watch stocks such as Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
- Also today watch gold mining stocks, such as Northern Star Resources (ASX:NST) and Newcrest Mining (ASX:NCM), as the gold price is trading higher. Meanwhile, seaborne iron ore has fallen, trading around US$150 a tonne.
- New listings on the ASX today include Sarama Resources (ASX:SRR) and Solstice Minerals (ASX:SLS).
Trading Ideas:
- Bell Potter maintain a BUY rating on Nitro Software (ASX:NTO), and have lowered their price target from $2.75 to $2.50. NTO last closed at $1.37, implying 82.5% share price growth in a year.
- Trading Central have identified a bullish signal in Firefinch (ASX:FFX), indicating that the stock price may rise from the close of $1.12 to the range of $1.43 to $1.51, over 18 days according to the standard principles of technical analysis.
The Aussie share market declined 1.6% this week (Mon-Thu), with nearly all industry sectors trading in the red.
In this week’s wrap, Sophia covers:
- (0:11) How the inflation rate impacts the share market
- (1:09) What happens when the RBA lifts the interest rate
- (3:29) City Chic Collective (ASX:CCX) rising after strong sales growth
- (4:00) Why EML Payments (ASX:EML) fell a massive 44%
- (4:18) The most traded stocks by Bell Direct clients
- (4:45) Two economic news items to watch out for
Yesterday, the ASX200 lost 56 points or 0.8% to close at 7,261 points. Aussie investors digested the latest inflation reading, which came in at 5.1%, that’s the highest reading since the introduction of the goods and services tax (GST) in the early 2000s. The jump in consumer prices reflected soaring fuel prices as well as surging building costs. The higher than expected increase has compelled economists to bring forward their expectation for the RBA’s imminent interest rate rise, from June to next Tuesday’s meeting.
Moving to the sector performances, the majority of the market closed in the red, with the tech sector down the most, taking a strong lead from the Nasdaq’s big tech sell off. Looking at the ASX200 leaderboard, Life360 (ASX:360) took a bit of a tumble, falling 29% after the tech platform abandoned its plans to list in the US. Whitehaven Coal (ASX:WHC) was the best performer, benefiting from the rising coal price.
The most traded stocks by Bell Direct clients yesterday were Syrah Resources (ASX:SYR), Mount Gibson Iron (ASX:MGX) and Bank of Queensland (ASX:BOQ).
Moving to the US, the three benchmarks struggled to find direction, with the market closing mostly higher. Both the Dow and S&P500 closed about 0.2% higher, while the Nasdaq closed flat at its 2022 low of 12,489 points. In terms of company results, Microsoft and Visa jumped higher after strong earnings reports. While, Alphabet and Boeing posted losses after their results missed consensus estimates.
What to watch today:
- The Aussie share market is set to open 0.7% higher this morning, going by the SPI futures.
- Medical device company, Cochlear (ASX:COH) will be on watch today, following news that it has agreed to pay $170m to acquire Oticon Medical. Keep in mind that while this acquisition is expected to add anywhere from $75m to $80m to annual revenue, the company is currently loss making.
- Watch Coles Group (ASX:COL) today, as it’s set to release its quarterly results today.
- Economic news wise, investors will digest the latest import and export prices for quarter one.
- In commodities, the oil price treaded between gains and losses as the US dollar soared, while the gold price fell to a two-month low. And the spot iron ore price is trading flat at US$137 a tonne.
- Scaffold and formwork supplier, Acrow Formwork and Construction Services (ASX:ACF) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on Australian agricultural chemical company, Nufarm (ASX:NUF) and have increased its price target from $6.40 to $7.85. At its current share price of $6.59, this implies 20% share price growth in a year.
- Trading Central has a bullish signal on BNPL company, Splitit Payments (ASX:SPT) indicating that the stock price may rise from the close of $0.21 to the range of $0.24 - $0.26 in the next 40 days according to standard principals of technical analysis.
Yesterday, the local market yesterday was trading in negative territory, ignoring the positive lead from Wall Street and closing with a loss of 2% or 155 points.
There is a lot of focus recently on the impact that the lockdowns in China will have on the demand outlook of commodities, which weighed down on the market. The materials sector suffered the greatest loss, shedding more than 5%, following a decline in commodity prices. A drop in oil prices also saw energy shares also suffer heavy losses, with the sector closing 4% lower. And all 11 industry sectors closed in the red.
Mining shares accounted for most of the worst performers, however the stock that declined the most was EML Payments (ASX:EML), which dropped 38.6% after cutting its EBITDA guidance by 8%, revenue guidance by 4% and profit guidance by 6.6%. Meanwhile, stocks that managed to post gains included Virgin Money (ASX:VUK), Block (ASX:SQ2) and Nufarm (ASX:NUF).
The most traded stocks by Bell Direct clients yesterday included BHP Group (ASX:BHP), the Vanguard Australian Shares ETF (ASX:VAS), Lake Resources (ASX:LKE), Bank of Queensland (ASX:BOQ) and Northern Star Resources (ASX:NST).
There was broad selling in New York, with 10 of the 11 S&P500 industry sectors closing lower, while higher oil prices lifted energy shares. A big tech-sell off saw the Nasdaq hit a fresh 52- week low, closing 4% lower and retreating further into bear market territory. The Dow Jones closed 2.4% lower and the S&P500 closed 2.8% lower.
What to watch today:
- The Australian share market is set to extend losses. The SPI futures are suggesting a sharp drop of 1.47% or 107 points at the open this morning.
- In economic data, today we’ll receive a key update on inflation. The inflation rate will be released at 11:30am AEST, and this rate measures the change in prices of goods and services for consumers. So, this will give us an indication of consumer price pressures and will also determine expectations for rate rises. Inflation is expected to lift above the RBA’s 2-3% target range for the first time since 2010, which is the last time rates rose.
- In commodities, oil prices have lifted as China’s central bank pledged to increase support for their economy. Iron ore prices are in the red, while gold is trading higher, following a slight pullback in the US dollar and lower Treasury yields.
Trading Ideas:
- Bell Potter maintain their Buy rating onMineral Resources (ASX:MIN) with a $70 price target. Mineral Resources last closed at $54.67, implying 28% share price growth in a year.
- Trading Central have identified a bullish signal in AUB Group (ASX:AUB), indicating that the stock price may rise from the close of $22.90 to the range of $24.70 - $25.10 over 16 days, according to the standard principles of technical analysis.
The local market took a bit of a hit in Friday’s trading session, falling 1.6%. That’s the biggest fall we’ve seen in over two months, and this followed Federal Reserve chairman Jerome Powell indicating that US interest rates are poised to rise higher and faster.
Sectors wise, all sectors came under pressure, in particular the materials and tech sectors, which both fell over 2.5%. The healthcare sector however provided the market with some relief, rising 0.5%.
Looking at the ASX200 leaderboard, hospitality and liquor group company, Endeavour Group (ASX:EDV) was the biggest gainer, lifting 1.7%, and CSL rose 1.5% after announcing a new $US4 billion debt raising to help fund its $16.4 billion acquisition of Vifor Pharma. Meanwhile, the worst performers were Megaport (ASX:MP1), Paladin Energy (ASX:PDN) and Pointsbet (ASX:PBH).
The most traded stocks by Bell Direct clients lastFriday includedBHP Group (ASX:BHP), Lake Resources (ASX:LKE) and the BetaShares Geared Australian Equity Fund ETF (ASX:GEAR).
Moving to the US, all three benchmarks closed in the green. The Dow managed to erase its 500-point intraday loss to close 200 points higher. This follows big tech names like Microsoft, Alphabet and Meta rallying in the afternoon. Twitter also soared after its board accepted Tesla CEO Elon Musk’s offer to take it private.
What to watch today:
- Despite the positive session in the US, if you go by the SPI futures, the Aussie share market is set to open 0.3% lower this morning.
- In commodities, the growing worries about global energy demand due to the prolonged lockdowns in Shanghai saw the WTI Crude oil price fall below US$100 a barrel. The gold price also dropped, as the potential for aggressive policy tightening by the US Fed weighed down on the haven’s appeal. The same can be said for uranium, which is trading over 8% lower. And the spot iron ore price is trading 0.7% lower at US$145 a tonne.
- Australian lithium exploration company, Lithium Plus Minerals will be debuting on the Aussie share market today. It will be trading under the ticker code LPM.
- If you’re a shareholder in global tech company, Adacel Technologies (ASX:ADA), you can expect to receive your dividend payment today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on coal mining company, Bathurst Resources (ASX:BRL) and have increased its price target from $1.25 to $1.63. At its current share price of $1.12, this implies 45% share price growth in a year.
- Trading Central has a bearish signal on South32 (ASX:S32), indicating that the stock price may fall from the close of $4.84 to the range of $4.45 - $4.53 in the next 24 days according to standard principals of technical analysis.
The Aussie share market advanced 0.9% this week (Mon-Thu). Most industry sectors posted gains, except for the tech and materials sectors which came under pressure.
In this week’s wrap, Sophia covers:
- (0:56) Why Ramsay Health Care (ASX:RHC) gained 29%
- (2:32) Megaport (ASX:MP1) falling after disappointing results
- (2:51) The top stocks in the All Ords this week
- (3:35) The most traded stocks by Bell Direct clients
- (3:52) Two stocks to consider if you're buying the dip
- (5:41) Three economic news items to watch out for
The local market advanced slightly higher yesterday, up 0.1% to 7,569 points, just 0.8% off reaching its record high. Sectors wise, the healthcare sector led the market, boosted by a sizeable jump in Ramsay Health Care (ASX:RHC)’s share price.
RHC, the second largest Australian-listed health company lifted an impressive 24% to $80 per share, after receiving a takeover proposal from private equity company, KKR. On the flip side, investment platform, HUB24 (ASX:HUB) fell the most, down 6.5% following some brokers responding to the company’s latest quarterly update, with a few trimming their price targets.
The most traded stocks by Bell Direct clients yesterday included Westpac (ASX:WBC), Lake Resources (ASX:LKE) and Ramsay Health Care (ASX:RHC).
The US market was divided. The Dow managed to gain about 250 points, off the back of strong results from Procter & Gamble, while the Nasdaq was dragged down by Netflix’s disappointing results, where it saw its first subscriber loss in more than 10 years. As well as company results, investors were keeping a close eye on the 10-year Treasury yield which retreated on Wednesday.
What to watch today:
- Despite the mixed session in the US, if you go by the SPI futures, the Aussie share market is set to open 0.40% higher this morning.
- Keep an eye on BNPL stock Zip (ASX:Z1P), the company will be releasing its third quarter update this morning. And as at the start of today’s trading session, Zip’s ticker code will change from Z1P to ZIP.
- Other companies set to release results today include BHP Group (ASX:BHP), Brambles (ASX:BXB), Challenger (ASX:CGF), Evolution Mining (ASX:EVN), Stockland (ASX:SGP) and Santos (ASX:STO).
- In commodities, the oil price rebounded following a drop in US oil inventories and concerns over tight supplies. The gold price traded slightly higher at US$1,957 an ounce. While the spot iron ore price is trading 2.7% lower at US$146 a tonne.
- There are two new companies debuting on the Aussie share market today. Firstly, Australian battery metals exploration company, Pure Minerals, its ticker code is PR1. And secondly, Perth-based crop nutrition company RLF AgTech, which will be trading under the ticker code RLF.
- There are also a few companies paying their dividends today. These include Lovisa (ASX:LOV), Rio Tinto (ASX:RIO), Cochlear (ASX:COH) and Austal (ASX:ASB).
- Lastly, capital market company, Plato Income Maximiser (ASX:PL8) and MFF Capital Investments (ASX:MFF) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on chemical manufacturing company, DGL Group (ASX:DGL) and have increased its price target from $3.50 to $4.30. DGL continues to validate its chemicals logistics vertical and despite record seasonal tailwinds, Bell Potter believe the company has several levers to grow earnings in financial year 2023.
- Trading Central has a bearish signal on Rio Tinto (ASX:RIO), indicating that the stock price may fall from the close of $118.30 to the range of $95 - $100 in the next 32 days according to standard principals of technical analysis.
Stocks rallied in yesterday’s session, with energy and materials pulling the market higher. The ASX200 closed 0.6% higher amid strong commodity prices, including the price of iron ore, with hopes of additional stimulus from China, a top importer, now that China is seeing risks of an economic slowdown following its COVID-19 lockdowns. The big miners and energy stocks gained yesterday, rising higher with the increase in oil prices, as outages in Libya deepened concern over tight global supply. Financials were up 0.9%, with the major four banks all in the green. Gold stocks also aided sentiment, extending gains into a seventh session. The top performing stock yesterday was biotech company Imugene (ASX:IMU), followed by Cleanaway Waste Management (ASX:CWY), which hit a new 52-week high yesterday.
The most traded stocks by Bell Direct clients yesterday were the Bank of Queensland (ASX:BOQ), Macquarie Group (ASX:MQG), Core Lithium (ASX:CXO) and BHP Group (ASX:BHP).
European stocks closed lower on Tuesday as investors’ attention was focused on the latest developments in the Russia-Ukraine war. US equities closed higher, with all three major benchmarks in the green. The Dow closed 1.5% higher or up almost 500 points, the S&P500 rose 1.6%, and tech rallied with the Nasdaq closing 2.2% higher. However, this morning the Nasdaq futures for today have fallen, after Netflix shares dropped 25% in extended trading after disappointing results, reporting a loss of 200,000 subscribers in the first quarter.
What to watch today:
- The Aussie share market is set to rise 0.62% at the open, according to the SPI futures.
- Keep watch of Rio Tinto (ASX:RIO) and Beach Energy (ASX:BPT). Both companies will release their quarterly production reports today.
- Watch Ramsay Health Care (ASX:RHC), as the private hospital operator has received a takeover approach from private equity company KKR. It’s a non-binding offer of $88 per share to acquire the company, so this bid is at a 37% premium to where RHC shares last traded, and it values the company at over $20 billion.
- In commodities, oil has dropped overnight, trading almost 6% lower at around US$102 per barrel, ending a four-day winning streak, following concerns of falling demand despite the tight supply. So watch energy stocks today. The price of gold also dropped overnight, as a strong US dollar and soaring treasury yields have worried investors. So gold miners may come under pressure today, including stocks such as Evolution Mining and Northern Star Resources. Meanwhile the iron ore price is flat.
Trading Ideas:
- Bell Potter maintain its Buy rating on Life360 (ASX:360), a market leading app for families. Their price target remains unchanged at $10. 360 last closed at $5.37, implying 86.2% share price growth in a year.
- Trading Central have identified a bullish signal in QBE Insurance (ASX:QBE), indicating that the stock price may rise from the close of $12.26 to the range of $13.80 to $14.20, over 29 days, according to the standards principles of technical analysis.
The local market advanced 0.6%, with nearly all sectors posting gains. The materials sector led the way, up an impressive 1.3%, while the financial sector was the only sector to post a loss.
Looking at the ASX200 leaderboard, travel stocks soared. Qantas (ASX:QAN) lifted 7%, its best performance since November 2020, as investors showed renewed confidence for this beaten down sector of the market. Meanwhile, the worst performer was Bank of Queensland (ASX:BOQ), down 6.3%, after the company reported results that disappointed the market and included cautions about a squeeze on margins.
The most traded stocks by Bell Direct clients last Thursday, they included Uniti Group (ASX:UWL), NAB (ASX:NAB) and Lake Resources (ASX:LKE).
Moving to the US, well it’s a big week of earnings for the market. Some big names reporting this week include Tesla, Netflix, United Airlines, Procter and Gamble, Johnson & Johnson, and American Express. On Monday however, all three benchmarks closed slightly lower with rising commodity prices heightening concerns about inflation. The 10-year Treasury yield also reached its highest level since late 2018, at one point trading at 2.8%.
What to watch today:
- Despite the US market slightly falling, the futures are suggesting that the Aussie market is set to open 0.13% higher this morning.
- In commodities, the oil price rose off the back of outages in Libya deepening concerns over tight supplies. The gold price hit a one-month high on Monday, nearly reaching the $2,000 an ounce level, as concerns around the Russia-Ukraine conflict and rising inflationary pressure increased the appeal of the safe-haven asset. And the spot iron ore price is trading 2% higher at US$150 a tonne.
- In economic news, the RBA will release its meeting minutes for April. The RBA noted that Australia's inflation has increased, and a further increase was expected, however, the board said it wanted to see actual evidence that the price level is sustainably within the 2 to 3% target range before it considers increasing interest rates.
- Chartered accounting network company, Kelly Partners Group (ASX:KPG) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on Allkem (ASX:AKE) with a trimmed price target, from $18.05 to $17.53. AKE’s current share price is $13.52 so this implies about 30% share price growth in a year.
- Trading Central has a bullish signal on drilling services company, DDH1 (ASX:DDH), indicating that the stock price may rise from the close of $1.07 to the range of $1.13 - $1.15 in the next 40 days according to standard principals of technical analysis.
Yesterday, the consumer confidence index fell by 0.9% month-on-month in April, down for the fifth straight month, and this follows inflation rising and prospects of higher interest rates, which has dampened sentiment further.
The Aussie share market gained 0.34% with all sectors in the green, except the real estate, tech, and communication services sectors.
Looking at the ASX200 leaderboard, AVZ Minerals (ASX:AVZ) topped the list, gaining 11.7% after the company received a positive technical opinion from the Department of Mines. This was the fourth and final requirement for a mining licence, meaning the company may soon be awarded a mining licence for its flagship project. And on the other end, cement and lime producer, Adbri (ASX:ABR) fell 4%. Morgan Stanley hold a pessimistic view on the stock due to adverse weather and higher energy costs.
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), Stockland (ASX:SGP) and Regis Resources (ASX:RRL).
Moving to the US, all three benchmarks closed in the green, with the Nasdaq and S&P500 snapping their respective three-day losing streaks. Stocks rallied, despite surging inflation numbers, as corporate earnings season kicked off.
What to watch today:
- Following the positive session in the US, the futures are suggesting that the Aussie market is set to open 0.23% higher this morning.
- In commodities, the oil price continues to rise, up over 3% to US$104. This comes as investors become more discouraged about the peace talks between Russia and Ukraine, further fuelling concerns about tight supplies. The gold price hit a one-month high as high inflation boosts its appeal. And the spot iron ore price is trading 2% higher at US$148 a tonne.
- In economic news, the unemployment rate will be released today at 11:30am AEST. As a reminder, the unemployment rate in February fell to 4%, which was only the third time in history that unemployment has fallen to that level. In the RBA’s statement on monetary policy in February, they noted that the unemployment rate is forecast to decline gradually over the forecast period, to 3.75% by the end of 2023. So, consensus is expecting March’s reading today to come in at 3.9%.
- Coal mining company, New Hope Corporation (ASX:NHC) and accounting services company Diverger (ASX:DVR) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on technology hardware and equipment company EROAD (ASX:ERD) however have reduced its price target from $5.95 to $5. ERD’s current share price is $2.71, so this implies 85% share price growth in a year.
- Trading Central has a bullish signal on Bapcor (ASX:BAP), indicating that the stock price may rise from the close of $6.46 to the range of $6.90-$7 in the next 10 days according to standard principals of technical analysis.
All sectors were down yesterday as commodity prices weakened. Long term interest rates also continued to push higher. Weighing down on the market yesterday was NAB’s business confidence survey, which increased to a 5- month high, while business conditions saw the largest jump since June 2020. The rise in conditions were driven by a large increase in retail, finance, business and property. And labour costs hit a record high, further dampening sentiment. Meanwhile the 10-year government bond reached its highest level since 2015.
The top performer was Regis Resources (ASX:RRL), boosted by the rise in the gold price, as well as a bullish broker note from Credit Suisse. Other gold miners also advanced, including St Barbara (ASX:SBM), Ramelius Resources (ASX:RMS), and Evolution Mining (ASX:EVN). Meanwhile, the healthcare sector declined 1.4% yesterday. Biotech company Imugene (ASX:IMU) was down the most. Bell Potter have a Speculative Buy rating on IMU.
The most traded stocks by Bell Direct clients yesterday were Lake Resources (ASX:LKE), Fortescue Metals (ASX:FMG), Wesfarmers (ASX:WES), South32 (ASX:S32) and Pilbara Minerals (ASX:PLS).
Overnight, the latest US inflation reading came in at its highest level since 1981. Consumer prices in March surged 8.5% from a year ago, higher than expected, and core CPI climbed 0.3% in March. The high inflation numbers raised expectations of tighter monetary policy from the Fed, which investors fear could slow the economy. The major benchmarks closed in the red. The Dow, S&P500 and Nasdaq down all down 0.3%.
What to watch today:
- Following US equities, the SPI futures are suggesting the local market will slightly fall 0.09% at the open this morning.
- In commodities, the oil price has jumped almost 8%, following relief about demand in China after Shanghai eased some virus restrictions.
- Gold is also trading in the green, following the US inflation reading. Meanwhile seaborne iron ore is trading slightly lower.
- In economic data, consumer confidence data will be released today by Westpac at 10:30am AEST.
- Iluka Resources (ASX:ILU) will hold its AGM today.
Trading Ideas:
- Bell Potter have maintained its Buy rating on capital market company, Pendal Group (ASX:PDL) but have reduced its price target from $7.48 to $6.80. This comes as the Pendal board has decided the proposal from Perpetual (PPT) is not in the best interests of shareholders, as it significantly undervalues the current and future value of the business. Now PDL closed 0.19% lower yesterday to $5.29, which implies about 29% share price growth in a year.
- Trading Central has a bearish signal onSantos (ASX:STO) indicating that the stock price may fall from the close of $8.00 to the range of $6.70 - $6.90 in the next 26 days according to standard principals of technical analysis.
The local market rose slightly higher yesterday, up 0.1%. Sectors wise, the market was mixed. The financials sector lifted 0.78% with all four of the big banks rising and NAB hitting a five-year high. While the tech sector was down 0.85%.
On the ASX200 leaderboard, GrainCorp (ASX:GNC) was the best performer, jumping an impressive 6.8%. The company’s recent guidance upgrade resulted in Wilsons increasing its earnings expectations for the company. Regis Resources (ASX:RRL) also gained, off the back of a rise in the gold price and a bullish broker note out of Credit Suisse. Meanwhile, the worst performing stocks included AVZ Minerals (ASX:AVZ) and PolyNovo (ASX:PNV). The a2 Milk Company (ASX:A2M) fell 5.4% after Credit Suisse trimmed its earnings estimates and valuation in response to the lockdowns in China and lower birth rate assumptions.
The most traded stocks by Bell Direct clients yesterday included uranium producer Boss Energy (ASX:BOE), Ardent Leisure Group (ASX:ALG) and Zeotech (ASX:ZEO), which closed 6.4% higher.
Moving to the US, all three benchmarks closed in the red. The Nasdaq falling over 2% as tech shares slumped off the back of higher rate fears. The Dow closed more than 400 points lower and the S&P500 was down 1.7%.
What to watch today:
· Following the negative session in the US, the futures are suggesting that the Aussie share market is set to open 0.29% lower this morning.
· In commodities, the oil price slid about 4% to US$94.29 a barrel, its lowest level since February, as lockdowns in China continue to spark demand fears. The gold price was steady, trading slightly higher. Remember, while gold is considered a hedge against inflation, rate hikes increase the opportunity cost of holding the non-yielding bullion. And the seaborne iron ore price is trading at US$156 a tonne.
· In economic news, business confidence for March will be released today. As a reminder, business confidence surged to 13 in February, which was the highest reading in four months, amid a decline in cases of the Omicron variant. Today’s reading for March is expected to come in lower. Stay tuned at 11:30am AEST.
· Seven Group Holdings (ASX:SVW) is set to go ex-dividend today.
Trading Ideas:
· Bell Potter have maintained its BUY rating on healthcare equipment and services company Pro Medicus (ASX:PME) with a price target of $55. PME announced its latest contract win in the US with the signing of Inova Health. It’s an 8-year deal generating minimum revenues of $32m. The deal increases contracted revenues to at least A$386m over 5 years. Now PME closed 1.1% higher yesterday to $48.50, which implies about 13% share price growth in a year.
· Trading Central has a bullish signal on Genesis Minerals (ASX:GMD), indicating that the stock price may rise from the close of $1.95 to the range of $2.32 - $2.42 in the next 63 days according to standard principals of technical analysis.
The ASX200 posted a small loss of 0.2% for the week, however on Friday the market gained 0.5%. Materials advanced the most, the sector closing with a 1.6% gain, as the major mining stocks rose despite a drop in the price of iron ore. It was a positive trading session overall with 7 of the 11 industry sectors in the green. The major banks were mixed, with CBA and ANZ higher, while NAB closed flat and Westpac closed slightly lower. And real estate, tech, healthcare and the consumer discretionary sector, ended the day with small losses.
Paladin Energy (ASX:PDN) jumped more than 13%. PDN is a uranium production company and its share price was boosted on Friday by a jump in the price of uranium. The commodity price rose to its highest level since the Fukushima nuclear disaster in March 2011, and that’s at $60.61 a pound. Meanwhile, Platinum Asset Management (ASX:PTM) led the declines on Friday, dropping 15%, down to $1.90, after the company reported that funds under management dropped $1.5 billion, and also reported negative returns across almost all of its funds for the year.
The most traded stocks by Bell Direct clients on Friday were Westpac (ASX:WBC), Finder Energy Holdings (ASX:FDR), Lake Resources (ASX:LKE) and Platinum Asset Management (ASX:PTM).
European markets ended a volatile week of trading in the green. While US stocks posted weekly losses after the Federal Reserve commented on tighter monetary policy, signalling it will act even more aggressively to fight inflation. The major benchmarks closed mixed. The Dow Jones climbed 100 points on Friday, up 0.4%, while the S&P500 closed 0.3% lower. The Nasdaq fell 1.3%, as tech stocks led the session’s losses. Tech stocks are viewed as risky due to their sensitivity to interest rates. Higher interest rates could limit future profit growth among the tech sector and therefore shares were sold on Friday.
What to watch today:
- The local market is set to rise 0.36% at the open this morning, if you’re going by the SPI futures.
- Oil prices are trading higher, however there are demand concerns for China, a top importer.
- Gold is trading higher as well, as the Federal Reserve’s aggressive tightening plans countered inflation concerns intensified by the Ukraine war and mounting sanctions on Russia.
- Iron ore is trading lower, however investors are expecting strong restocking demand in China once COVID-19 restrictions ease. Lockdowns in some of the top steel making cities have led to transportation disruptions, with most producers cutting production amid material shortages.
- Brickworks (ASX:BKW) is set to go ex-dividend today.
Trading Ideas:
- Citi maintain its Buy rating on Aristocrat Leisure (ASX:ALL), with a $44 price target. Citi expects acquisitional growth into the US$15 million iGaming market to be likely following legalisation, and Citi also note that the core social casino business offers 16% compound annual earnings growth through to FY24.
- Trading Central have identified a bullish signal in Boss Energy (ASX:BOE), indicating that the stock price may rise from the close of $2.58 to the range of $3.10 to $3.25, over 26 days, according to the standard principles of technical analysis.
The Aussie share market declined 0.7% this week (Mon-Thu). The utilities sector outperformed, while the tech sector and consumer discretionary sector came under pressure.
In this week’s wrap, Sophia covers:
- (0:25 ) What happened in global markets in Q1
- (2:26) Why it's worth considering nickel
- (3:52) What to think about when interest rates rise
- (5:04) Pendal (ASX:PDL) lifting 18% after receiving a takeover offer
- (5:37) The most traded stocks by Bell Direct clients
- (5:57) Three economic news items to watch out for
The local market declined 0.5% yesterday, weighed down by the tech sector as Aussie tech shares followed the US Nasdaq led, and took a tumble.
Sectors wise, only the financials and consumer staples sectors managed to close in the green. The gains for the banks were partly due to the increase in interest rate expectations following the RBA’s monetary policy statement on Tuesday.
Looking at the ASX200 leaderboard, healthcare company, PolyNovo (ASX:PNV) performed well, lifting 4.6% after the business revealed its strong March quarter results. The company delivered a 60% increase in revenue compared with the same period last year. Travel stocks also were amongst the best performers, including Flight Centre (ASX:FLT) and Corporate Travel Management (ASX:CTD) as the sector continues to benefit from the removal of restrictions around the world. Meanwhile, stocks that took a hit yesterday included tech shares NOVONIX (ASX:NVX) and Block (ASX:SQ2), as well as AVZ Minerals (ASX:AVZ).
The most traded stocks by Bell Direct clients yesterday included mineral company, Andromeda Metals (ASX:ADN), Champion Iron (ASX:CIA) and Vanguard Australian Shares ETF (ASX:VAS).
Moving to the US, all three benchmarks closed in the red for the second day. This comes as the US Federal Reserve gave more insight on its plans to tighten monetary policy to fight inflation. Central bank officials are considering larger rate hikes than the usual 25-basis-points. And across the sea, European markets closed lower off the back of the Fed’s hawkish comments and as investors await details of fresh international sanctions against Russia.
What to watch today:
· Following the negative session in the US, the futures are suggesting that the Aussie share market is set to open 0.28% lower this morning.
· In commodities, the oil price has sunk 5% following the International Energy Agency (IEA), releasing 120 million barrels from strategic reserves. The gold price on the other hand was steady, trading at US$1,925 an ounce. And the spot iron ore price continues to trade flat at US$154 a tonne.
· In economic news, balance of trade data for February will be released today. Australia's trade surplus increased to $12.89 billion in January 2022. Today’s reading for February is expected to come in a bit lower at $12 billion.
· Scentre Group (ASX:SCG) is holding its AGM today.
Trading Ideas:
· Another stock that is benefiting from the strong market demand for lithium is Mineral Resources (ASX:MIN) and Bell Potter have maintained its BUY rating on the stock, lifting its price target from $61.35 to $74.35. This is due to MIN’s increase in lithium production plans. MIN plans to double spodumene processing capacity at Mount Marian lithium mine. Now MIN closed 1.1% higher yesterday to $60.35, which implies about 23% share price growth in a year.
· Trading Central has a bullish signal on Steadfast Group (ASX:SDF), indicating that the stock price may rise from the close of $4.87 to the range of $5.30 - $5.40 in the next 14 days according to standard principals of technical analysis.
The local market advanced 0.2% higher yesterday, losing some of its steam in the afternoon when the RBA suggested an interest rate rise could be imminent. While the cash rate was kept at its historic low of 0.1%, many economists believe there will be an increase later this year, some expecting it to come as early as June. The Government’s cost of living packages announced in the Federal Budget last week added further fuel to the fire that interest rates could rise.
Sectors wise, all sectors were in the green, with the tech sector and energy sector gaining the most. The local tech sector took a strong lead from Wall Street, where the Nasdaq lifted nearly 2% higher on news that Elon Musk had acquired a 9.2% stake in Twitter. Meanwhile the materials, real estate and industrials sectors posted losses.
Looking at the ASX200 leaderboard, tech names like Block (ASX:SQ2), NOVONIX (ASX:NVX), Xero (ASX:XRO) and Altium (ASX:AU) were amongst the best performers. Mineral Resources (ASX:MIN) jumped 5.7% after announcing it had agreed with its joint venture partners to increase production in its spodumene mines in WA, their response to the huge global customer demand for lithium. On the flipside, the worst performers yesterday included AVZ Minerals (ASX:AVZ), Liontown Resources (ASX:LTR) and Lynas Rare Earths (ASX:LYC).
The most traded stocks by Bell Direct clients yesterday included Temple & Webster (ASX:TPW), Core Lithium (ASX:CXO) and NOVONIX (ASX:NVX).
Moving to the US, all three benchmarks closed in the red, with the Nasdaq down the most. This comes as the US Federal Reserve indicated that the central bank could take a more aggressive approach to its tightening policy. This saw tech stocks decline, while sectors like utilities and healthcare pushed higher. Also, the Biden administration on Wednesday is set to announce additional sanctions targeting Russian financial institutions.
What to watch today:
- Following the pullback in the US, the futures are suggesting that the Aussie share market is set to open 0.64% lower this morning.
- In commodities, the oil price fell on worries that new COVID cases could slow demand. The gold price also fell following the Fed’s hawkish outlook which offset safe-haven demand. And the spot iron ore price is trading flat at US$154 a tonne.
- Keep watch of Coles (ASX:COL) today amid reports that Wesfarmers (ASX:WES) has sold a $500 million stake in the supermarket giant.
Trading Ideas:
- Bell Potter have maintained its BUY rating on Allkem (ASX:AKE) and have a price target of $18.05. AKE closed 0.83% higher yesterday to $13.42, which implies about 35% share price growth in a year.
- Trading Central has a bullish signal on Temple & Webster (ASX:TPW), indicating that the stock price may rise from the close of $7.05 to the range of $8.10 - $8.40 in the next 32 days according to standard principals of technical analysis.
Investors played it safe yesterday and traded cautiously, following the news that Germany is pushing for discussions with the European Union to ban Russian gas imports. This may lead to energy rationing in Europe and would push prices higher.
The market closed slightly higher yesterday, with utilities, materials and tech making the most gains. It was a profitable session again for mining stocks: BHP Group (ASX:BHP), Fortescue Metals (ASX:FMG) and Rio Tinto (ASX:RIO) were all in the green. And lithium miners such as Allkem (ASX:AKE), Mineral Resources (ASX:MIN), Liontown Resources (ASX:LTR) and Pilbara Minerals (ASX:PLS) were all higher. Gold miners also gained, even while the gold price was lower. Financials closed 0.3% lower yesterday, as the four major banks lost ground. While Magellan Financial Group (ASX:MFG) is finally picking back up again, yesterday reaching a 1-month high. Its shares lifted with help from the biggest mover on the ASX200 yesterday, investment manager Pendal Group (ASX:PDL), which rose 18% after receiving a $2.4 billion takeover bid from Perpetual. Perpetual’s share price however, declined the most yesterday. Iluka Resources (ASX:ILU), also gained following the approval of its $1.2 billion refinery in Eneabba in Western Australia, and this will be the first fully integrated, rare earths separation facility in Australia.
The most traded stocks by Bell Direct clients yesterday included Commonwealth Bank (ASX:CBA), Core Lithium (ASX:CXO), Pilbara Minerals (ASX:PLS) and NOVONIX (ASX:NVX).
Overnight, US equities were in the green. The Dow was up 0.3%, the S&P500 up 0.8%, while the Nasdaq rallied 1.9%.
What to watch today:
- Off the back of a strong rally across global markets, the Australian market is set to rise 0.67% at the open this morning, according to the SPI futures.
- In economic data, at 2:30pm today (AEST), the RBA will announce its interest rate decision, which is expected to remain unchanged at 0.1%.
- In commodities, the oil price is trading more than 4% higher, with the possibility of more sanctions on Russia.
- Seaborne iron ore has extended its gain. And the gold price is also higher, following last week’s fall.
Trading Ideas:
- Bell Potter maintain their Speculative Buy rating on De Grey Mining (ASX:DEG) and have lowered their valuation to $1.72. Bell Potter also have Hold rating on Gold Road Resources (ASX:GOR) with a $1.70 price target, and a Speculative Hold rating on DGO Gold (ASX:DGO) with a valuation of $4.37.
- Trading Central have identified a bullish signal in Black Rock Mining (ASX:BKT), indicating that the price may rise from the close of $0.27 to the range of $0.31 to $0.33, over 35 days, according to the standard principles of technical analysis.
On Friday mining stocks made strong gains, with BHP Group (ASX:BHP) contributing the most, rising over 4%. The energy sector rebounded on Friday, however week-to-date, it was the worst performer as the price of oil declined further.
Allkem (ASX:AKE) closed 8.5% higher, after reporting record pricing ahead of the June quarter. AKE’s gains also boosted other lithium miners, including Pilbara Minerals (ASX:PLS), Mineral Resources (ASX:MIN) and AVZ Minerals (ASX:AVZ).
The most traded stocks by Bell Direct clients on Friday included VAS, the Vanguard Australian Shares ETF, Allkem (ASX:AKE), Core Lithium (ASX:CXO), Wesfarmers (ASX:WES) and Fortescue Metals (ASX:FMG).
European and US equities began the second quarter on a positive note. All three US benchmarks closed higher. The Dow up more than 100 points or 0.4%, the S&P500 up 0.3% and the Nasdaq up 0.3%.
What to watch today:
- The local market is set to rise 0.25% at the open this morning if you’re going by the SPI futures.
- In commodities, the oil price is trading lower as the lockdowns in China have caused demand concern, as well as news that the International Energy Agency have agreed to join the US in the largest release of oil reserves on record. The weekly loss was more than 13%, which was the largest weekly fall in 2-years. The US will release 1 million barrels per day for 6 months, starting in May.
- The gold price is also trading lower, after the US jobs report displayed a tight labour market, provoking expectations for a 50-basis point increase in the Fed funds rate in May, to tame inflation.
- Seaborne iron ore has jumped, trading 6% higher, just under US$160 a tonne, as iron ore futures on the Dalian Commodity Exchange were higher.
Trading Ideas:
- Bell Potter maintain their BUY rating on Perpetual (ASX:PPT) and have lowered their price target on PPT from $44.30 to $42.80. PPT last closed at $34.23, implying 25% share price growth in a year. And Bell Potter see 30.3% upside over the next year, including the 5.3% yield.
- Trading Central have identified a bullish signal in Pilbara Minerals (ASX:PLS), indicating that the stock price may rise from the close of $3.43 to the range of $3.90 to $4.05, over 29 days, according to the standard principles of technical analysis.
The Aussie share market gained 1.3% this week (Mon-Thu), with all industry sectors advancing, apart from the energy sector.
In this week’s wrap, Sophia covers:
- (0:10) Key insights from the Federal Budget
- (3:12) Why Life360 (ASX:360) & NOVONIX (ASX:NVX) rallied
- (3:55) 88 Energy (ASX:88E) crashing after disappointing results
- (4:16) The most traded stocks by Bell Direct clients
- (4:35) Four economic news items to watch out for
The local market pushed 0.67% higher yesterday, in what was a broad-based rally. Tech shares led the way, as well as some automotive companies that benefited from the Federal Budget, following the drop in the fuel excise. While the energy and materials sectors posted small losses.
Looking at the ASX200 leaderboard, tech names like Life360 (ASX:360), Megaport (ASX:MP1), Afterpay’s parent company Block (ASX:SQ2), NOVONIX (ASX:NVX) and Xero (ASX:XRO) were amongst the best performers. Magellan Financial Group (ASX:MFG) jumped 7%, despite funds continuing to flow out of the business. Meanwhile, South32 (ASX:S32) declined 3.5% after the company announced a delay to the acquisition of an additional shareholding in Mozal Aluminium.
The most traded stocks by Bell Direct clients yesterday, they included Lake Resources (ASX:LKE), Mineral Resources (ASX:MIN) and Fortescue Metals (ASX:FMG).
In the US, all three benchmarks closed in the red, with the Nasdaq down the most. Both the Dow and S&P500 snapped their 4-day winning streaks as investors remain cautious on Ukraine developments, as well as the bond market.
What to watch today:
- Despite the pullback in the US, the futures are suggesting that the Aussie share market is set to open 0.13% higher this morning.
- In commodities, the oil price rebounded, jumping 3% on tight supply and investor concerns about potential new Western sanctions against Russia. The gold price managed to gain off the back of a weaker US dollar and a slight pullback in US bond yields. The gold price is currently at US$1,934 an ounce. The aluminium, zinc, nickel, and palladium prices are all trading between 2.5 – 5% higher. And the spot iron ore price is trading flat at US$148 a tonne.
- Stocks going ex-dividend today include Eagers Automotive (ASX:APE) and Harvey Norman (ASX:HNV).
Trading Ideas:
- Bell Potter have maintained its BUY rating on Eagers Automotive (ASX:APE) and have increased its price target to $17.25 (previously $16.75). APE announced the proposed acquisition of a portfolio of dealerships and associated properties located in Canberra, ACT. The acquisition allows APE to gain entry into the ACT and be able to rollout easyauto123 in that market. APE closed 2.9% higher yesterday to $14.50, which implies about 19% share price growth in a year.
- Trading Central has a bullish signal on Goodman Group (ASX:GMG), indicating that the stock price may rise from the close of $23.06 to the range of $24.60- $24.90 in the next 28 days according to standard principals of technical analysis.
Last night the Federal Budget was announced. There was a major focus on the cost of living and national security. Some of the positive news included cutting the fuel excise by 50%, in an effort to bring down petrol prices; low & middle income earners are to receive an additional $420 back on their tax returns; combining paid parental leave; a one-off payment of $250 to welfare recipients; and an expansion to the first home buyers scheme, with only a 5% deposit required to buy a house with no lenders mortgage insurance.
Ahead of the Federal Budget release yesterday, the local market reached an 11-week high. The rally touched all industry sectors, except the materials and energy sectors.
Telix Pharmaceuticals (ASX:TLX) was the biggest mover on the ASX200 yesterday, after its lead product received approval from the US Food and Drug Administration. And Magellan Financial (ASX:MFG) rebounded 7%, after a large sell-off. Meanwhile Whitehaven Coal (ASX:WHC) was down the most.
Lake Resources (ASX:LKE) was once again the most traded stock by Bell Direct clients. Yesterday the lithium developer announced it had signed a non-binding memorandum of understanding with Japanese trading company Hanwa Co, for offtake of 15,000 to 25,000 tonnes per annum of lithium carbonate over 10 years, from one of its projects in Argentina, the Kachi Project. The lithium carbonate is to be priced at average quarterly benchmark market prices.
US equities extended its winning streak overnight, as traders followed ceasefire negotiations in Europe and key levels in the bond market. The Dow gained over 300 points, or 1%, the S&P500 closed 1.2% higher, while the tech heavy Nasdaq closed 1.8% higher.
What to watch today:
- The local market is set to rise 0.75%, going by the SPI futures.
- In commodities, the oil price is lower following negotiations between Russia and Ukraine.
- Gold extended losses, nearing its lowest level in 4 weeks. And seaborne iron ore is slightly higher at US$150.14 a tonne.
- Around 15 stocks are set to go ex-dividend today. This often sees shares fall, as investors take their profits.
Trading Ideas:
- Bell Potter have a Speculative Buy rating on Mesoblast (ASX:MSB) and have lowered their valuation from $3.75 to $2, implying 75.6% share price growth in a year.
- Trading Central have identified a bullish signal inReliance Worldwide (ASX:RWC), indicating that the price may rise from the close of $4.30 to the range of $4.80 to $4.95, over 26 days, according to the standard principles of technical analysis.
The local market managed to close with a small gain of 0.08% yesterday, a 10-week high for the benchmark ASX200 index. Sectors wise, the materials sector posted the biggest gain, and the financials, utilities and consumer staples sectors also lifted. While the remaining sectors posted losses, with the tech sector down the most.
Looking at the ASX200 leaderboard, materials stocks led the way, with seven making the top 10 list, including BHP Group (ASX:BHP) up 2.3%, fertiliser company, Incitec Pivot (ASX:IPL) up 2.3% and Champion Iron (ASX:CIA) up 2.2%. On the flipside, tech shares were amongst the worst performers, with Xero (ASX:XRO), Tyro Payments (ASX:TYR), Novonix (ASX:NVX) and WiseTech Global (ASX:WTC) posting losses.
The most traded stocks by Bell Direct clients yesterday, included Woodside Petroleum (ASX:WPL), Westpac (ASX:WBC) and Telstra (ASX:TLS). Westpac’s share price is up about 10% from the start of this year and Citi are optimistic on the stock, naming Westpac as its top choice compared to the other big four banks.
Moving to the US, all three benchmarks are in the green, with the Nasdaq up the most. This was thanks to a modest 8% jump in Telsa’s share price, after the electric vehicle maker said it wants to split its stock to pay a stock dividend. Energy stocks slid alongside the price of oil, which we will touch on shortly.
What to watch today:
- The futures are suggesting that the Aussie share market is set to open 0.52% higher this morning.
- Economic news wise, retail sales for February will be released today. This estimates the turnover and volumes for retail businesses, including store and online sales.
- Tonight, all eyes will be on the 2022-23 Federal Budget that will be announced at 7.30 pm (AEDT). It’s a pre-election budget, with the election less than a couple of months away.
- In commodities, the oil price slid over 9% as new lockdowns in Shanghai prompted fears of a slowdown in demand, given China is the world’s largest oil importer. The WTI crude oil price has fallen to around US$103 a barrel. The gold price also fell about 1.8% on a firmer US dollar and yields. On the flipside, the spot iron ore price is trading 2.8% higher to US$146 a tonne.
- Sigma Healthcare (ASX:SIG) is set to release its financial year 2022 results.
Trading Ideas:
- Bell Potter have maintained its BUY rating on electric services company, GenusPlus Group (ASX:GNP) and have increased its price target to $1.72 (previously $1.40). Bell Potter maintain their positive view on GNP’s demand outlook. This is supported by planned upgrades to east coast interconnector infrastructure, ageing distribution infrastructure and structural tailwinds in renewables investment. GNP closed about 0.8% lower yesterday to $1.21, which implies about 42% share price growth in a year.
- Trading Central has a bullish signal on NEXTDC (ASX:NXT), indicating that the stock price may rise from the close of $11.08 to the range of $12.40- $12.70 in the next 24 days according to standard principals of technical analysis.
On Friday the ASX200 closed 0.26% higher and rose to a two-month high at 7,406 points, supported by a rise in metal and energy prices. Seven of the eleven sectors closed in the green, with materials and utilities in the lead. Healthcare stocks led the market losses.
On the ASX200 leaderboard, BlueScope Steel (ASX:BSL) was the top performer, rising over 5% to $21.46, boosted by the rising price of steel. The steel price is higher due to the Russia-Ukraine war and China’s COVID lockdown. Meanwhile, Telix Pharmaceuticals (ASX:TLX) declined the most. The company made two announcements last week: firstly, that it has begun developments of its Belgian radiopharmaceutical production facility, and secondly, that one of its clinical trials has progressed to the next stage. Although positive announcements, its share price remained in the red.
The most traded stocks by Bell Direct clients on Friday included Lake Resources (ASX:LKE), which has gained 85% this month, since the 1st of March. Aurelia Metals (ASX:AMI) was also highly traded, as investors sold shares in the gold miner after it announced lower grades of mineralisation in the Dargues Gold Mine. Core Lithium (ASX:CXO) is also lower after announcing the resignation of its CEO, Stephen Biggins.
Global markets continue to track negotiations over the Russia-Ukraine war. European stocks closed slightly higher, and in US equities, the Dow was up 0.4%, the S&P500 up 0.5%, posting its second consecutive winning week, while the Nasdaq was slightly lower, down 0.2%.
What to watch today:
- The ASX200 is set to rise 0.45% at the open this morning, if you’re going by the SPI futures.
- In economic news, retail sales data for February will be released today, as well as ANZ’s data on job advertisements for March.
- In commodities, oil turned positive on Friday, trading at US$113.90 a barrel on reports of a missile strike and fire at the Saudi Aramco facility.
- Gold has steadied at approximately US$1,960 an ounce, after jumping the two previous sessions. And seaborne iron ore is higher, trading just under US$150 a tonne.
- Companies that are set to go ex-dividend today include Cochlear (ASX:COH) and Reece (ASX:REH).
Trading Ideas:
- Bell Potter have a Speculative Buy rating on DGO Gold Limited (ASX:DGO), recognising the higher level of risk and volatility of returns. The company has prospective operations and cash flows and Bell Potter have lowered their valuation from $4.47 to $4.41. DGO last closed at $2.63, implying 68% share price growth in a year.
- Trading Central have identified a bullish signal in Charter Hall (ASX:CHC), indicating that the stock price may rise from the close of $15.99 to the range of $17.90 to $18.30, over 40 days, according to the standard principles of technical analysis.
The Aussie share market has advanced 1.3% this week (Mon-Thu). Oil prices once again rose over US$120 a barrel, which helped boost both the utilities and energy sectors.
In this week’s wrap, Sophia covers:
- (0:42) Lithium explorer, AVZ Minerals (ASX:AVZ) gaining over 20%
- (1:54) Cettire (ASX:CTT) falling 21% after its CEO sold 35 million shares
- (2:08) The most traded stocks by Bell Direct clients
- (2:30) The impact of Russia's uranium economic isolation
- (5:09) Five economic news items to watch out for
On Wednesday, Australian shares rose to a two-month high, as tech shares gained 3.5%, following the US tech rally. The local tech sector was led by Afterpay’s parent company Block (ASX:SQ2), which rose to its highest closing price since the company officially listed on the ASX in January, at $188.10.
Financials closed at the sector’s highest level since mid-November. Major banks, NAB, CBA, Westpac and ANZ all closed with solid gains, which may partly reflect comments on the increase in interest rates by US Federal Reserve Chairman Jerome Powell. Morgan Stanley has said that ANZ and NAB could announced a $1 billion and $2 billion buyback, respectively, in May, while CBA may launch another share buyback, with an additional $2 billion, if it goes ahead with plans to sell its 10% stake in the Chinese Bank, the Bank of Hangzhou.
Looking at the ASX200 leaderboard shares in Uniti Group (ASX:UWL) led among blue chips. UWL surged 10.7% before entering into a trading halt in afternoon trade. This followed news of a $5 a share bid for Uniti, made by Macquarie Asset Management and PSP Investments. This new proposal beats the current offer on the table from Morrison & Co by approximately 11%. Meanwhile Fisher & Paykel Healthcare (ASX:FPH) fell 8%, after the company announced it expects a decline in its sales guidance for FY22 and also warned that freight costs are weighing on margins.
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), Northern Star Resources (ASX:NST) and the Australian Foundation Investment (ASX:AFI).
US equities closed in the red, with all three major benchmarks lower. The Dow was down 1.3%, the S&P500 down 1.2% and the Nasdaq down 1.3%.
What to watch today:
- Following the broad sell-off in New York overnight, the SPI futures are suggesting the ASX200 will fall 0.73% at the open this morning.
- In commodities, the oil price rallied, trading at US$114 per barrel, after Russia announced that a storm in the Black Sea had damaged one of the world’s largest oil pipelines, which has disrupted exports from Russia and Kazakhstan.
- The gold price is also higher, however remains under pressure as the Fed calls for an aggressive monetary tightening to combat inflation.
- Iron ore is lower, moving away from the 7-month high hit earlier this month, following demand concerns with the resurgence of COVID-19 cases in China.
- Companies that are set to go ex-dividend today include Cash Converters (ASX:CCV), Healius (ASX:HLS) and Spark New Zealand (ASX:SPK).
Trading Ideas:
- Bell Potter maintain their BUY rating on Uniti Group (ASX:UWL) and have increased their price target from $4.50 to $5. This price target is a premium to the office price of $4.50 by Morrison & Co, in the bidding war for Uniti.
- Trading Central have identified a bullish signal in Ioneer (ASX:INR) indicating that the price may rise from the close of $0.58 to the range of $0.69-$0.71, over 19 days, according to the standard principles of technical analysis.
The local market was back in the green yesterday, up 0.9% with the materials and energy sectors boosting the market. Overall, the market was mixed, with six of the 11 industry sectors closing lower, with the tech sector down the most.
Looking at the ASX200 leaderboard, Liontown Resources (ASX:LTR) was the best performer, up 6.3%, followed by AVZ Minerals (ASX:AVZ) and BHP Group (ASX:BHP), which added 5.1%. Computershare (ASX:CPU) posted a solid gain of 4.3%. One of the tailwinds helping Computershare recently is the outlook for rising interest rates, which will help increase its margins. On the flipside, tech shares were amongst the worst performers, with Block (ASX:SQ2) and Life360 (ASX:360) giving up some of their gains from the prior session.
The most traded stocks by Bell Direct clients yesterday, they included Commonwealth Bank (ASX:CBA), Woodside Petroleum (ASX:WPL) and Allkem (ASX:AKE).
Moving to the US, as at the time of recording, all three benchmarks are in the green as investors digest Federal Reserve Jerome Powell’s latest rate hike comments. Goldman Sachs on Monday upped its forecast to 50 basis point hikes at the May and June Fed meetings.
What to watch today:
- The futures as at 7:30am AEDT, are suggesting that the Aussie share market is set to open 0.4% higher this morning.
- Economic news wise, the manufacturing and services flash PMI for March will be released today. PMI stands Purchasing Managers’ Index which is essentially an index of the prevailing direction of economic trends in the manufacturing and service sectors. The flash PMI today is a forward-looking estimate of the final PMI, which is set to be released next week.
- In commodities, the oil price was mixed, currently trading down about 0.8%. It now looks unlikely that the European Union will pursue an embargo on Russian oil.
- The gold price slipped to a near one-week low off the back of Federal Reserve Jerome Powell’s hawkish stance, which sent Treasury yields higher. Now gold is highly sensitive to rising US interest rates, as they increase the opportunity cost of holding non-yielding bullion.
- Seek (ASX:SEK), Myer Holdings (ASX:MYR) and Supply Network (ASX:SNL) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on Nickel Mines (ASX:NIC) and have lifted its price target by 7% to $1.88. The comes as PT Oracle Nickel Industry, the operating entity housing the Oracle Nickel RKEF project, has been granted material corporate tax relief. This removes an expense of ~US$50 million per annum from its estimates for ten years. Now NIC closed about 1.5% higher yesterday to $1.29, which implies about 46% share price growth in a year.
- Trading Central has a bullish signal on Pilbara Minerals (ASX:PLS), indicating that the stock price may rise from the close of $3.00 to the range of $3.40- $3.55 in the next 24 days according to standard principals of technical analysis.
The local market started the new trading week with a small loss of 0.2%, breaking its three-day winning streak from last week.
Sectors wise, the market was mixed, with the industrials and healthcare sectors declining the most, both falling over 1%, while the tech sector managed to post a gain of 2.5%.
Block (ASX:SQ2) was the session’s best performer, lifting a massive 9.2%, following another strong session for the company’s US listed shares. Family safety app, Life360 (ASX:360) also performed well, gaining 6.4% and EML Payments (ASX:EML) jumped 6.1%. On the flipside, Western Australian gold explorer, De Grey Mining (ASX:DEG) led the losses, down 7.7%, and Magellan Financial Group (ASX:MFG) also fell after its co-founder Hamish Douglass resigned as an independent director, more than a month after he took medical leave.
The most traded stocks by Bell Direct clients yesterday included Core Lithium (ASX:CXO), REA Group (ASX:REA) and Northern Star Resources (ASX:NST).
As at the time of recording, all three US benchmarks are in the red, and this follows Federal Reserve Chair Jerome Powell stating that inflation is too high and his commitment to taking the “necessary steps” to bring prices under control. Separately, Boeing has fallen more than 3% after a China Eastern Airlines Boeing 737 passenger plane crashed.
What to watch today:
- The futures as at 7am AEDT, are suggesting that the Aussie share market is set to open 1.1% higher this morning.
- In commodities, the oil price has jumped more than 7% after European nations considered joining the US in a Russian oil embargo. The WTI crude oil price is currently trading at US$112 a barrel.
- The gold price is trading higher following further escalations in Ukraine, which have boosted the safe-haven’s demand.
- The nickel price is down nearly 12%. Russia is the world’s third-largest nickel producer, and the current Russia/Ukraine war has sparked supply fears.
- The spot iron ore price is currently trading 2.5% higher at US$145 a tonne.
- Toll road operator, Atlas Arteria (ASX:ALX), Emeco Holdings (ASX:EHL) and health supplements company, Blackmores (ASX:BKL) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on Technology One (ASX:TNE) with a price target of $14 (previously $15). TNE closed about 1% lower yesterday to $11.11, which implies about 26% share price growth in a year.
- Trading Central has a bullish signal on Galan Lithium (ASX:GLN), indicating that the stock price may rise from the close of $1.54 to the range of $1.75 - $1.81 in the next 21 days according to standard principals of technical analysis.
Last week ended on a positive note, as Aussie shares closed higher for the third straight session, closing 0.6% on Friday, and lifting its weekly gain by 3.3%.
The energy sector led the market after the oil price rose 9%, while the tech sector followed. The technology sector was led by Block (ASX:SQ2),which rose 7.2% to $168.88. Liontown Resources (ASX:LTR), Paladin Energy (ASX:PDN) and Telix Pharmaceuticals (ASX:TLX) were among the top performers, while Megaport (ASX:MP1) fell 8%, following news that its founder and chairman, Bevan Slattery, had sold $3 million MP1 shares.
The most traded stocks by Bell Direct clients on Friday included Lake Resources (ASX:LTR), Core Lithium (ASX:CXO) and BHP Group (ASX:BHP).
US stocks posted their best week since 2020. The Dow rose more than 270 points or 0.8%, the S&P500 rose 1.1% and the Nasdaq rose 2.05%.
What to watch today:
- Following the rally on Wall Street, the local market is set to rise 0.81% at the open this morning, going by the SPI futures.
- In commodities, oil is trading 2% higher at US$104.95 a barrel, after a 8% rally in the previous session.
- Gold weakened past US$1,940 an ounce. And seaborne iron ore is higher at US$159.59 a tonne.
- Adairs (ASX:ADH) and NRW Holdings (ASX:NWH) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter maintained their BUY rating on The a2Milk Company (ASX:A2M) and have lowered their price target from $7.70 to $7.15. They expect the scope for EPS to double by FY26, if the company can execute on its China offline expansion strategy, while regaining 50% of the lost sales in its English label IMF, from FY20-21. A2M last closed to $5.40, implying 32.4% share price growth in a year.
- Trading Central have identified a bullish signal in AVZ Minerals (ASX:AVZ), indicating that the price may rise from the close of $0.92 to the range of $1.20 to $1.28, over 68 days.
The Aussie share market soared this week, rising 2.65% (Mon-Thu), supported by the US Federal Reserve's decision to raise rates for the first time since 2018.
In this week’s wrap, Sophia covers:
- (1:05) Uniti Group (ASX:UWL) gaining 30% on news of a takeover offer
- (2:03) Agri-business Elders (ASX:ELD) jumping to a decade high
- (2:51) Why major mining stocks & energy producers lost ground
- (3:52) The most traded stocks by Bell Direct clients
- (4:13) What the Fed's rate hike decision means for Australia
- (5:20) Two economic news items to watch out for
Before we begin, we wanted to let you know that this week, we’ve donated $10,000 to Foodbank, as the clean-up and support efforts continue through flood affected regions in Australia. Foodbank is an organisation that is supplying food and water to the front line of the flood crisis including the SES volunteers. To help support the cause, you can donate here: https://foodbank.raisely.com/helpnswfloodvictims
Yesterday, the local market advanced 1.1%, with all sectors closing in the green. The broad rally was led by the tech sector, which gained 3.3%, while the energy sector performed the worst, lifting just 0.2%, following a further decline in the oil price.
Looking at the ASX200 leaderboard, five of the top 10 best performing stocks, were tech shares, including Life360 (ASX:360) which was up the most, rising 7.4%. On the flip side, Super Retail Group (ASX:SUL) and Nanosonics (ASX:NAN) both declined around 3%, and Uniti Group (ASX:UWL) dropped 1.3%, as investors may have taken a bit of profit off the table following the stocks strong rise on Tuesday, after confirmation that it was in takeover talks.
The most traded stocks by Bell Direct clients yesterday, Lake Resources (ASX:LKE) was again on top of the list, lifting over 11% yesterday, set to be added to the ASX300 Index on the 22nd of March. Also highly traded was the Vanguard Australian Fixed Interest Index ETF (ASX:VAF), BHP Group (ASX:BHP) and Telstra (ASX:TLS).
Moving to the US, all three benchmarks closed in the green after the US Federal Reserve announced its first rate hike in more than three years, with officials indicating an aggressive path ahead, meaning we could see further rate rises at each of its remaining six meetings of this year. The Fed approved a 0.25% rate hike, which brings the rate now into a range of 0.25% - 0.50%.
What to watch today:
- Following the positive session in the US, the futures are suggesting that the Aussie share market is set to open 1.6% higher this morning.
- In commodities, the oil price continued to sink following Russia-Ukraine optimism and an increase in US inventories. The oil price is currently trading at US$95 a barrel. The gold price remained steady, at US$1,926 an ounce, after the US Fed hiked rates as expected. And the seaborne iron ore price is currently trading higher at US$148 a tonne.
- In economic news, the unemployment rate for February will be released today. As a reminder, the unemployment rate came in at 4.2% in January, which was unchanged from the month prior. For today, consensus is expecting February’s rate to come in at 4.1%.
- Coronado Global Resources (ASX:CRN), DDH1 (ASX:DDH), PWR Holdings (ASX:PWH), Genesis Energy (ASX:GEN), Fletcher Building (ASX:FBU) and electricity generation company Meridian Energy (ASX:MEZ) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its BUY rating on drilling contractor DDH1 (ASX:DDH) with a price target of $1.56. Bell Potter expects ongoing rig fleet growth to drive calendar year 2022 earnings, while normalising domestic border conditions present operational upside. DDH closed flat yesterday at $1.04, which implies about 50% share price growth in a year.
- Trading Central has a bullish signal on Alpha HPA (ASX:A4N), indicating that the stock price may rise from the close of $0.57 to the range of $0.61 - $0.63 in the next 16 days according to standard principals of technical analysis. Bell Potter also has a speculative BUY rating on the stock with a 12-month valuation of $0.96.
Yesterday, the local market was dragged down by mining stocks, after iron ore futures China’s Dalian market dropped 7% and the iron ore contract for April on the Singapore Exchange dropped 9%. Several Asian markets were down 5-6%, following further lockdowns to contain surging COVID cases in China. More than $50 million people in China have been placed under lockdown in an attempt to achieve the country’s zero COVID-19 strategy.
On the ASX200, materials and energy declined the most, closely followed by the tech sector. Meanwhile, financials closed with the most gains. The stand out stock on the ASX200 was Uniti Group (ASX:UWL), jumping an impressive 27%, before being placed into a trading halt. This was amid speculation that the company is in takeover talks with Vocus Group. The offer is looking to be in the region of $4 to $5. Meanwhile, Chalice Mining (ASX:CHC) and Champion Iron (ASX:CIA) declined the most.
Some of the most traded stocks by Bell Direct clients yesterday, included Lake Resources (ASX:LKE), BHP Group (ASX:BHP) and Allkem (ASX:AKE).
US equities closed higher as a reading of wholesale inflation came in lighter than expected. The S&P500 rose for its first gain in four days, closing more than 2% higher. The Dow Jones up 1.8% or just under 600 points, while the Nasdaq jumped 2.9%.
What to watch today:
- Following the US, the SPI futures are suggesting the local market will rise 0.58% at the open this morning.
- In commodities, oil has dropped a further 6.7%, now trading just over US$96, now more than 25% below its recent 14-year high of $130.50 reached last week. The new wave of COVID cases in China has also caused worries of China’s demand.
- Gold is down to US$1,917 an ounce, after US treasury yields surged past 2%, as investors await an upcoming rate hike from the Fed. And seaborne iron ore is 3.6% lower at US$144.77 a tonne.
- Some companies set to go ex-dividend today, include Data3 (ASX:DTL), Inghams Group (ASX:ING), and Money3 Corporation (ASX:MNY).
Trading Ideas:
- Bell Potter have a Speculative BUY rating on Boss Energy (ASX:BOE), following the company reporting its half year results. Bell Potter’s valuation has been increased from $3.47 to $3.57 per share.
- Trading Central have identified a bullish signal in Aussie Broadband (ASX:ABB), indicating that the price may rise from the close of $5.34 to the range of $6.10 to $6.30, over 58 days, according to the standard principles of technical analysis.
The local market advanced an impressive 1.2% yesterday, with 10 of the 11 industry sectors posting gains. The financial sector boosted the market the most, while the materials sector was slightly down 0.3%.
Agribusiness, Elders (ASX:ELD) was the best performer, lifting 11% to a decade high. This was off the back of a positive trading update, where the company announced it expects its underlying earnings before interest tax (EBIT) to increase 20% in financial year 2022. It was also a good day for capital market company, Pendal Group (ASX:PDL) and holding company, Virgin Money UK (ASX:VUK). Meanwhile, materials stocks like Chalice Mining (ASX:CHC), Nickel Mines (ASX:NIC) and Pilbara Minerals (ASX:PLS) led the losses.
As for the most traded stocks by Bell Direct clients yesterday, Lake Resources (ASX:LKE) was on top of the list, along with Brickworks (ASX:BKW) and Core Lithium (ASX:CXO). Also highly traded were CBA, NAB & Bendigo & Adelaide Bank (ASX:BEN).
Moving to the US, the market closed in the red, as oil prices fell rapidly. Also investors await the latest Ukraine developments and anticipate the first rate hike by the Federal Reserve this week. This saw the Dow close flat, while the S&P500 fell 0.74% and the Nasdaq slipped over 2%.
What to watch today:
- Following the negative session over in the US, the futures are suggesting that the Aussie share market is set to open 0.8% lower this morning.
- In commodities, the oil price has retreated about 7% to US$101 a barrel. This comes as Russia and Ukraine were slated to resume peace talks on Monday, while China’s March demand is set to be revised lower due to new COVID-19 lockdowns.
- The gold price slipped 1.6% to US$1,952 per ounce as US Treasury yields rose on rate hike expectations. And silver, copper and palladium were also trading lower, with the palladium price down over 15%.
- Keep watch of Rio Tinto (ASX:RIO) today, after the company announced a non-binding proposal to acquire the remaining 49% of the Canadian miner, Turquoise Hill, that it doesn’t already own. If the deal is successful, RIO’s share of the Oyu Tolgoi operation will increase to 66%.
- Economic news wise, the RBA will release its meeting minutes for March. The RBA currently views the war in Ukraine as a source of uncertainty and expects underlying inflation to increase further in the coming quarters to around 3.25%, before declining to around 2.75% in 2023.
- ASX200 stocks going ex-dividend today, include media companies News Corp (ASX:NWS) and IVE Group (ASX:IGL), copper miner Sandfire Resources (ASX:SFR) and telco TPG Telecom (ASX:TPG).
Trading Ideas:
- Bell Potter have maintained its BUY rating on Uniti Group (ASX:UWL) with a price target of $4.50. Bell Potter believe the stock represents value and is also a potential takeover target. UWL closed 0.96% higher yesterday to $3.15, which implies about 43% share price growth in a year.
- Trading Central has a bullish signal on testing, inspection and verification services company, ALS (ASX:ALQ), indicating that the stock price may rise from the close of $12.84 to the range of $14.60 - $15 in the next seven days according to standard principals of technical analysis.
Aussie shares ended the week in the red, down 0.9%, dragged down by a 3% fall in the tech sector. BNPL stock Zip (ASX:Z1P) was the worst performer on the ASX200, closed more than 8% lower. Xero (ASX:XRO) closed down more than 5%, while Altium (ASX:ALU) and lock (ASX:SQ2) were also lower. Meanwhile, utilities, energy and materials closed in the green.
The best performer on Friday was Allkem (ASX:AKE), which is the lithium producer formally known as Orocobre. Demand for lithium and electric vehicles has led to AKE’s share price growth over the last few years and on Friday the stock closed 5% higher. Incitec Pivot (ASX:IPL) and Nufarm (ASX:NUF) also lifted on Friday with the war in Ukraine causing a global shortage in fertiliser. The stocks gain 2.5% and 2%.
The most traded stocks by Bell Direct clients included Core Lithium (ASX:CXO), Lake Resources (ASX:LKE), ANZ (ASX:ANZ), Nickel Mines (ASX:NIC) and Rio Tinto (ASX:RIO).
In Europe, the European Central Bank delivered a hawkish surprise, to slow its bond purchases from the start of May, saying it may end its quantitative easing program altogether by the third quarter. However, economists had anticipated a more delayed withdrawal of monetary stimulus.
In the US, CPI data for February came in at 8%, the highest reading since January 1982. And despite expectations for cooling goods demand on the back of the post-COVID reopening: core goods CPI printed at 12% in the year through February, the highest since 1975. US equities closed lower. The Dow down 0.7%, the S&P500 down 1.3%, while the Nasdaq dropped 2.2%.
Locally today, the ASX200 is set to rise 0.28%, going by the SPI futures.
What to watch today;
- In commodities, oil is trading higher, slightly above US$109 per barrel, however posted a 5.7% decline on the week. Gold is trading lower, just over US$1,984 an ounce, after retreating from a near record high earlier in the week. Investors weighed geopolitical uncertainties against a commodity-driven rise in inflation, prompting central banks to signal willingness to tighten monetary policy sooner. And seaborne iron ore is trading at US$155 a tonne.
- Watch Chalice Mining (ASX:CHN), as the gold mining company is set to report its earnings.
- Companies set to go ex-dividend today include Best & Less (ASX:BST), Pepper Money (ASX:PPM), SCA Property (ASX:SCP) and Suncorp (ASX:SUN).
Trading Ideas:
- Bell Potter maintain their BUY rating on Doctor Care Anywhere (ASX:DOC), a UK- based telehealth company. Bell Potter have lowered their price target from $1.30 to $0.55, largely reflecting the re-rating of growth stocks in recent weeks. DOC last closed at $0.29, implying 89.6% share price growth in a year.
- Trading Central have identified a bullish signal in gold miner Firefinch (ASX:FFX), indicating that the stock price may rise from the close of $0.80 to the range of $0.89 to $0.91, over 20 days, according to the standard principles of technical analysis.
The materials and energy industry sectors have cooled off this week, however the Aussie share market gained 0.3% (Mon-Thu).
In this week’s wrap, Sophia covers:
- (0:34) Mesoblast (ASX:MSB) leads the ASX200
- (1:00) The gold miners that gained as the safe-haven commodity rose
- (1:36) Why Nickel Mines (ASX:NIC) tumbled 24%
- (2:51) The most traded stocks by Bell Direct clients
- (3:21) Bell Potter’s top tech picks
- (5:28) Two economic news items to watch out for
Yesterday at ASX200 closed in the green for the first time in four days. The tech sector rebounded, after what had been a week of heavy losses, with software players WiseTech (ASX:WTC) and Xero (ASX:XRO) adding 6.4% and 1.8% respectively. The likes of Block (ASX:SQ2) and Zip (ASX:Z1P) also made gains. BNPL stock Z1P posted its first positive session since the February 25th.
Mesoblast (ASX:MSB) rebounded 17%, after falling earlier this week. While Paladin Energy (ASX:PDN) jumped 10%, off the back of broker upgrades. Bell Potter have upgraded PDN from a HOLD to a Speculative BUY. The broker says that the Uranium price continues to recover from cyclical lows, as limited near-term supply spurs the spot market, whilst the global path to decarbonisation re-shapes the role of nuclear energy over the longer-term. PDN represents the largest and most liquid exposure to uranium on the ASX, with the pending restart decision at their flagship Langer Heinrich Mine.
The most traded stocks by Bell Direct clients yesterday included 29 Metals (ASX:29M), Core Lithium (ASX:CXO) and Lake Resources (ASX:LKE).
US equities are higher, with all three major benchmarks in the green. The S&P500 and the Dow up more than 2.5% and the Nasdaq rallying 3.9% higher.
Following the US, the SPI futures are suggesting the local market will rise 0.44% at the open this morning.
What to watch today:
- In commodities, the price of oil has cooled off, trading 12% lower at US$109 a barrel, as investors try to assess the impact of recent sanctions in the oil market.
- The gold price is also trading 3% lower, as some investors may be selling gold to raise cash to buy undervalued stocks offsetting gold's safe-haven appeal. And seaborne iron ore is has fallen to US$157 a tonne.
- Capricorn Metals (ASX:CMM), De Grey Mining (ASX:DEG) and Gold Road Resources (ASX:GOR) are set to report their earnings today.
Trading Ideas:
- Bell Potter maintain their BUY rating on Nickel Mines (ASX:NIC) with a $1.76 price target. NIC entered and exited a trading halt on Wednesday, following a 23% drop in its share price in morning trade. This resulted from speculation around the possible implications for private equity company Tsingshan Holding Group, which is the world’s largest stainless steel producer and parent company of Shanghai Decent Investment, who are NIC’s largest shareholder, having a 17.9% stake in the company. NIC last closed at $1.40, implying 25.3% share price growth in a year.
We wanted to let you know that this week, we’ve donated $10,000 to the Australian Red Cross QLD and NSW Floods Appeal to provide vital humanitarian support to the people and communities affected by the 2022 floods. We're committed to supporting our community through this difficult time and are thinking of those Australians who have suffered catastrophic losses, knowing the journey to rebuild is only beginning for many. To help support the cause, you can donate here: https://www.redcross.org.au/floodsappeal/
Now let’s take a brief look at what happened yesterday. The local market declined 0.8%, weighed down by both the energy and materials sectors, as investors feared that higher energy prices due to Russia’s war in Ukraine would drive inflation higher and hurt the global economy.
Gold miner, St Barbara (ASX:SBM) was the best performer, lifting nearly 13%, supported by the rising gold price, but also due to claims that it could be a takeover target. And healthcare stocks like Imugene (ASX:IMU), Mesoblast (ASX:MSB), CSL (ASX:CSL) and ResMed (ASX:RMD) also performed well. While, the major miners led the losses, even as iron ore prices climbed above $US160 a tonne.
The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE) was on top of the list again, along with Rio Tinto (ASX:RIO), Northern Star Resources (ASX:NST), Westpac (ASX:WBC) and ANZ (ASX:ANZ).
US shares continued to fall overnight, as investors try to determine the impact of the Russia-Ukraine war. The Dow fell about 180 points, falling deeper into correction territory, the S&P500 was down 0.72% and the Nasdaq fell 0.28%, falling further into bear market territory.
Despite the negative session over in the US, the futures are suggesting that the Aussie share market is set to open slightly higher this morning.
What to watch today:
- In commodities, the oil price is trading 4% higher to US$124 a barrel, and in fact popped up as much as 7% following President Joe Biden announcing a ban on Russian fossil imports including oil in response to the country’s invasion of Ukraine. The gold price continues to trade higher, at US$2,050 per ounce.
- And the nickel price jumped a massive 88%, surging at one point to a record US$100,000 a tonne, so today keep watch of miners with exposure to nickel, such as IGO (ASX:IGO), Nickel Mines (ASX:NIC) and Western Areas (ASX:WSA).
- In economic news, the Westpac Consumer Confidence index will be released today at 10:30am AEDT. As a reminder, the index declined 1.3% to 100.8 points in February 2022, and March’s figure is expected to come in at 99.2, according to Trading Economics.
- Companies going ex-dividend today include Accent Group (ASX:AX1), Brambles (ASX:BXB), Costa Group Holdings (ASX:CGC) and Imdex (ASX:IMD).
Trading Ideas:
- Bell Potter have maintained its BUY rating on media technology company, Ai-Media Technologies (ASX:AIM) with a price target of $0.90. Overall, Bell Potter remains positive on the company and its outlook. In particular, they are attracted to the growing global market opportunity. AIM closed flat yesterday at $0.56, which implies 53% share price growth in a year.
- Trading Central has a bearish signal on Sims (ASX:SGM), indicating that the stock price may fall from the close of $18.92 to the range of $14.20 - $15.10 in the next 16 days according to standard principals of technical analysis.
Yesterday, the local market had its worst day of the month, however energy and materials remained strong, boosted by discussions by the US to ban Russian oil imports into the US.
As commodities continue to rise, oil and gas producer Woodside Petroleum (ASX:WPL) was up 9.5%, and strong gains were made by gold miners Northern Star Resources (ASX:NST), Ramelius Resources (ASX:RMS) and Gold Road Resources (ASX:GOR). Copper miner IGO (ASX:IGO) and other large mining stocks also lead the ASX200.
The most traded stocks by Bell Direct clients included Lake Resources (ASX:LKE), Woodside Petroleum (ASX:WPL) and 29Metals (ASX:29M).
US shares tumbled overnight, amid concerns of higher energy prices stemming from the Russia-Ukraine conflict, as well as inflation concerns. The Dow lost almost 800 points, down 2.4%, the S&P500 down 3%, while the Nasdaq fell 3.6%, now sitting in bear market territory.
What to watch today:
- Following US equities, the Australia market is set to open flat this morning.
- In commodities, the oil price surged to near US$130 a barrel, now trading at US$119.
- Gold has also jumped, topping $2,000 per ounce for the first time since August 2020. Gold is seen as a safe-haven metal and therefore demand for gold has risen.
- Seaborne iron ore is also higher. And wheat has jumped as well. Ukraine is responsible for more than 25% of the world’s wheat exports, which will be severely disrupted this year.
- In economic news, the NAB Business Confidence index will be released today 11:30am AEDT. The index bounced to 3 in January this year, from December’s low of -12. February’s figure is expected to fall to 1.
- There are several companies going ex-dividend today also, including Iluka Resources (ASX:ILU), Lovisa (ASX:LOV), Mader Group (ASX:MAD) and Sonic Healthcare (ASX:SHL).
Trading Ideas:
- Bell Potter maintain their BUY rating on Flight Centre (ASX:FLT), retaining a positive view on the stocks outlook and competitive position as global travel recovers. Bell Potter have upped their target price from $20 to $20.50. The stock last closed at $17.05, implying 20.2% share price growth in a year.
- Trading Central have identified a bullish signal in Cobalt Blue Holdings (ASX:COB), indicating that the price may rise from the close of $0.65 to the range of $0.82 to $0.88, over 34 days.
On Friday the ASX200 dropped 0.6%, with the tech sector down the most, after making solid gains earlier in the week.
Some big tech names were among the worst performing stocks, including Tyro Payments (ASX:TYR), EML Payments (ASX:EML), Zip (ASX:Z1P) and Block (ASX:SQ2).
Meanwhile, gold miners made the most gains as the spot price rose. Perseus Mining (ASX:PRU), Newcrest Mining (ASX:NCM) and Gold Road Resources (ASX:GOR) were the top three stocks on Friday.
The most traded stocks by Bell Direct clients on Friday were Santos (ASX:STO), Mineral Resources (ASX:MIN), and BHP Group (ASX:BHP).
As the invasion of Ukraine continues to rattle global markets, European markets had the worst week since March 2020. US equities also closed in negative territory. The Dow Jones down 0.5%, the S&P500 down 0.8%, while the Nasdaq fell 1.7%. This was despite a better-than-expected US jobs report. The US unemployment rate was down to 3.8%.
What to watch today:
- The SPI futures are suggesting the local market will rise 0.4% higher at the open this morning.
- The strong oil rally continues. Oil is trading 7% higher and reached US$115 a tonne This is as the US looks to cut off US imports of oil and petroleum products to Russia. Additionally, OPEC will remain with the existing agreement for a gradual increase in production.
- Energy prices were higher across the broad after news that Russian troops had attacked a nuclear power plant in Ukraine.
- Gold is higher at US$1,970 an ounce, and seaborne iron ore is higher at US$152 a tonne.
- In economic data, today Australian job advertisement data will be announced for February.
- And some stocks set to go ex-dividend today include CSL (ASX:CSL), Australian Financial Group (ASX:AFG), Altium (ASX:ALU), Bendigo and Adelaide Bank (ASX:BEN), and Northern Star Resources (ASX:NST).
Trading Ideas:
- Bell Potter maintain their Speculative BUY rating on Chalice Mining (ASX:CHN) and have decreased their valuation to $12.02. Bell Potter says the company has demonstrated resource growth potential and the commencement of regional exploration programs signal potential positive news flow on ongoing exploration success. Macquarie also have an Outperform rating on the stock and a $10.55 price target.
- Trading Central have identified a bullish signal in EMvision Medical Devices (ASX:EMV), indicating that the price may rise from the close of $1.98 to the range of $2.25 to $2.31, over 29 days.
The Russian invasion of Ukraine escalated this week, however the Aussie share market managed to gain 2.2% (Mon-Thu).
In this week’s wrap, Sophia covers:
- (0:10) How countries and companies are disarming Russia
- (1:58) Why conflict based sell-offs are typically short-lived
- (2:44) Energy producers and miners making solid gains
- (3:20) Zip (ASX:Z1P) falling 15% after announcing Sezzle takeover
- (3:59) The most traded stocks by Bell Direct clients
- (4:40) Two economic news items to watch out for
The energy sector continued to gain, supported by the rising oil price. Energy prices are on the rise, with the war in Ukraine and sanctions against Russia, one of the world’s largest energy producers. Energy closed 4.9% higher yesterday and materials closed 3% higher.
Economic growth data was also released yesterday. The Australia economy saw its strongest lift since 1976. GDP grew by 3.4% in the December quarter. The largest contribution to the economic expansion was household spending, up 3.2%.
Stocks that made strong gains off the back of soaring commodity prices included Santos (ASX:STO) and Woodside Petroleum (ASX:WPL). And the big mining stocks gained, including Whitehaven Coal (ASX:WTC), South32 (ASX:S32), Sandfire Resources (ASX:SFR), Ramelius Resources (ASX:RMS), Fortescue Metals (ASX:FMG) and Rio Tinto (ASX:RIO).
And the most trading stocks by Bell Direct clients yesterday included Core Lithium (ASX:CXO), Lake Resources (ASX:LKE) and Australia and New Zealand Bank (ASX:ANZ).
Stocks rebounded in New York overnight, despite the escalating war in Ukraine and soaring commodity prices. It was a broad rally, the Dow up 1.8%, the S&P500 up 1.9% and the Nasdaq up 1.6%.
What to watch today:
- Following US equities, the local market is set to open higher, with the SPI futures suggesting a 0.99% rise at the open this morning.
- In economic news, balance of trade data for January will be released today.
- Oil jumped another 7% and is now trading at US$111 per barrel. The International Energy Agency, the IEA, has warned that global energy security is under threat as the worsening crisis in Ukraine and broadening sanctions against Russia create fears of further supply disruptions.
- Gold is trading lower at US$1,926 an ounce, while the seaborne iron ore price has jumped to $146 a tonne.
- Some of the big names going ex-dividend today include Woolworths (ASX:WOW), Coles (ASX:COL), Pro Medicus (ASX:PME), IGO (ASX:IGO) and ASX (ASX:ASX).
Trading Ideas:
- Bell Potter maintain their BUY rating on Select Harvests (ASX:SHV) and have lowered their price target from $7.10 to $6.85. SHV last closed at $5.55, implying 23.4% share price growth in a year.
- Trading Central have identified a bullish signal in De Grey Mining (ASX:DEG) indicating that the price may rise from the close of $1.23 to the range of $1.55 to $1.63 over 29 days, according to the standard principles of technical analysis.
The ASX200 closed 0.7% higher, with tech once again in the lead, with investors moving back into tech. This was after a rally by the Nasdaq and coincided with a drop in the US 2-year Treasury yield. Meanwhile utilities declined the most. Investors were also conscious of the RBA’s meeting yesterday. The RBA held the cash rate at 0.1% and mentioned that the Russia – Ukraine war is a major source of uncertainty, considering the supply issues and effects on global energy markets. The bank is expecting inflation to further increase to 3 ¼ %, and then decline to approximately 2 ¾ %over the course of next year.
Looking at the ASX200 leaderboard, Pointsbet Holdings (ASX:PBH) was the top performer, while big tech names also made the top 10, including EML Payments and Tyro Payments, as well as Block (ASX:SQ2), which jumped more than 12% to $175.16 after Macquarie said its share price could rise near 50% within the next year. Among the tech rally, Xero (ASX:XRO) and WiseTech (ASX:WTC) also gained.
The most traded stocks by Bell Direct clients yesterday included Auckland International Airport (ASX:AIA), Transurban Group (ASX:TCL), BHP (ASX:BHP), ANZ (ASX:ANZ) and NAB (ASX:NAB).
European and US markets suffered heavy losses overnight. The Dow Jones lost nearly 600 points, down 1.8%, the S&P500 down 1.6% and the Nasdaq down 1.6%.
The local market is set to drop, with the SPI futures suggesting a 0.92% fall at the open this morning.
What to watch today:
- In economic data, today the GDP growth rate for the fourth quarter will be released.
- In commodities, the oil price continues to move higher, reigniting concerns for interest rates and growth. Oil leapt for than 10% to above US$105 per barrel. Gold is trading higher at its strongest levels since January 2021 and the seaborne iron ore price is sitting at US$143 a tonne.
- Some of the companies set to go ex-dividend today include GQG Partners (ASX:GQG), Link Administration (ASX:LNK), oOh!media (ASX:OML), Platinum Asset Management (ASX:PTM), and Telstra (ASX:TLS).
- Boss Energy (ASX:BOE) is set to report its earnings today.
Trading Ideas:
- Bel Potter maintain their Buy rating on Avita Medical (ASX:AVH) and have slashed their price target from $9 to $4.60. Bell Potter continue to forecast excellent long term growth for AVH, however say it is unlikely to manifest over the next year. AVH last closed at $3.23, implying 42.4% share price growth in a year.
- Trading Central have identified a bullish signal in Vimy Resources (ASX:VMY) indicating its price may rise to $0.26 to $0.28 over 26 days.
Yesterday the ASX200 closed in the green, with eight of the eleven industry sectors higher. The materials and energy sectors lead the market yesterday, underpinned by strong oil prices.
On the ASX200 leaderboard, Blackmores (ASX:BKL) gained the most, rebounding from the previous session. On Friday BKL dropped 10.5% following its earnings report, before bouncing back on Monday and closing 9.8% higher. Ord Minnett and Morgans say Blackmores is a Hold, while Citi have a Sell rating. Meanwhile, Life360 (ASX:360) was the worst performer, falling 9%. 360 is a Bell Potter Buy.
The most traded stocks by Bell Direct clients yesterday included BHP Limited (ASX:BHP), Accent Group (ASX:AX1), Tyro Payments (ASX:TYR) and Westpac (ASX:WBC).
US equities closed mixed overnight. The Dow down 0.5%, the S&P500 down 0.2%, while the Nasdaq closed 0.4% higher.
The local market is set to rise, with the SPI futures suggesting a 0.23% rise at the open this morning.
What to watch today:
- Oil prices continue to rally as the war escalates in Ukraine. Oil is currently 4.8% higher at US$95 a barrel. The gold price had its largest monthly gain since May, trading higher at US$1,910 an ounce. And the seaborne iron ore price is lower at US$141 a tonne.
- In economic data, today the RBA will announce its interest rate decision, expected to remain unchanged at 0.1%.
- As reporting season wraps up, many companies are set to go ex-dividend this week. This often sees shares fall, as investors take their profits. Today, ex-dividend stocks include AUB Group (ASX:AUB), Endeavour Group (ASX:EDV) and Origin Energy (ASX:ORG).
Trading Ideas:
- Bell Potter maintain their Buy rating on BWX (ASX:BWX) and have decrease their price target from $6.10 to $4.90. BWX delivered a statutory NPAT loss of $2.3 million, due to several headwinds relating to the COVID-19 lockdowns.
- Trading Central have identified a bullish signal in Lotus Resources (ASX:LOT), indicating that the stock price may rise from the close of $0.29 to the range of $0.34 to $0.36, over 24 days, according to the standard principles of technical analysis.
On Friday the tech sector made a comeback, advancing more than 8% following Block’s quarterly results.
Block (ASX:SQ2) is the US payment company that acquired Afterpay last month, and its ASX listed shares jumped 32.5% on Friday to $153.75. Quarterly revenue surpassed analysts’ forecasts, increasing 29% higher than the year prior. Life360 (ASX:360) was another top performer. Now on Thursday, 360 fell 29% to $4.60 following its earnings report. The stock then rebounded on Friday, up 22% to $5.71. Meanwhile, Blackmores (ASX:BKL) was 10.5% lower, falling for the second consecutive session, after reporting a decline in revenue for its Australia and New Zealand region. Magellan Financial (ASX:MFG) also closed 10% lower, after reporting a further decline in its funds under management.
The most traded stocks by Bell Direct clients on Friday included Mount Gibson Iron (ASX:MGX), Transurban Group (ASX:TCL), Westpac (ASX:WBC), Northern Star Resources (ASX:NST) and ANZ (ASX:ANZ).
US equities closed with strong gains on Friday. The Dow up 2.5%, and S&P500 up 2.3% and the tech heavy Nasdaq up 1.6%.
Following the rally in New York, the ASX200 is set to jump at the open this morning. The futures are suggesting a rise of 2.4% at the open.
What to watch today:
- In commodities, oil is lower at US$91.80 a barrel, following a rally in the prior session, that saw prices top US$100 for the first time since 2014. The gold price is also lower amid concerns over the economic impact of the Russia-Ukraine conflict. And the seaborne iron ore price is down to US$141 a tonne.
- In economic data, retail sales data for January will be released today.
- Approximately 15 companies are set to report their earnings results today, including the Bank of Queensland (ASX:BOQ), Lynas Rare Earths (ASX:LYC) and Mesoblast (ASX:MSB).
- Some big names are also set to go ex-dividend today, including Aurizon (ASX:AZJ), Credit Corp Group (ASX:CCP), Evolution Mining (ASX:EVN), and Fortescue Metals (ASX:FMG).
Trading Ideas:
- Bell Potter maintain their BUY rating on Infomedia (ASX:IFM), a leading provider of software solutions in the automotive industry. Following the company’s half year results, Bell Potter have decreased their price target from $2 to $1.85, considering the earnings changes as well as market movements and time creep. IFM reported revenue grew 24% to $59 million, 5% above Bell Potter’s forecast. IFM last closed at $1.43, implying 29.4% share price growth in a year.
- Trading Central have identified a bullish signal in Paladin Energy (ASX:PDN), indicating that the price may rise from the close of $0.77 to the range of $1.01 to $1.07, within 33 days. Bell Potter say PDN is a Speculative stock and have maintained their Hold rating.
The Aussie share market fell 3.2% (Mon-Thu), weighed down by Thursday's loss, the market's worst day since September 2020. Consumer staples managed to advance more than 4%, while tech shares dropped 10%.
In this week’s wrap, Sophia covers:
- (0:12) The Russia-Ukraine war and its impact on oil prices
- (1:58) Why Cimic Group's (ASX:CIM) share price jumped 35%
- (3:11) Life360 (ASX:360) falling 29% after releasing its result
- (3:47) The most traded stocks by Bell Direct clients
- (4:16) Bell Potter's stock upgrades and downgrades this week
- (5:20) Three economic news releases to watch
The Aussie share market managed to advance 0.6% yesterday. Nine of the eleven industry sectors posted gains, with the tech sector advancing the most. On the flip side, the real estate sector and utilities sector posted small losses.
On the ASX200 leaderboard, HUB24 (ASX:HUB) lifted nearly 10% off the back of its solid half-year results. The investment advice company experienced a record inflow of funds during the half, and an increase of 80% in its group underlying EBITDA. Macquarie maintained its Outperform rating on HUB and stated that the company is now its preferred exposure among wealth platforms. And a few tech stocks performed well, including Tyro Payments (ASX:TYR), as well as Life360 (ASX:360) and Zip (ASX:Z1P), who are both set to report today. Meanwhile, Domino’s Pizza (ASX:DMP) was the worst performer, plummeting 14% after its half-year results showed that its underlying net profit had plunged 5.3% to $91.3 million. This was short of Bell Potter’s and consensus’ expectations of $96m. Bell Potter have retained its HOLD rating with a 27% reduction in its price target to $95.
The most traded stocks by Bell Direct clients yesterday included AVZ Minerals (ASX:AVZ), BrainChip (ASX:BRN) and Woodside Petroleum (ASX:WPL).
In the US, the S&P500 closed lower for the fourth straight session, the Dow was down over 400 points and the Nasdaq declined more than 2% with the market is struggling to find direction given the Russia-Ukraine tensions.
In line with the negative session over on Wall Street, the futures are suggesting the Aussie share market will open 1.3% lower this morning.
What to watch today:
- In commodities, the oil price is currently up, trading around US$92 a barrel. The gold price is up about 0.6% to US$1,907 an ounce. The palladium price is up 5%, so keep watch of ASX stocks like Chalice Mining (ASX:CHN) and Liontown Resources (ASX:LTR). And the seaborne iron ore price is trading around US$143 a tonne.
- Reporting season:
- Firstly, Rio Tinto (ASX:RIO) released its results after market close yesterday, announcing a record financial result and total dividend of US247cps. So keep watch of RIO when the market opens.
- We’ll also hear from several travel stocks, including Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Auckland International Airport (ASX:AIZ).
- Tech stocks like Zip Co (ASX:Z1P), Appen (ASX:APX), Altium (ASX:ALU) and Life360 (ASX:360) are also set to report, as well as Blackmores (ASX:BKL) and Iluka Resources (ASX:ILU).
- Bell Potter expects Appen (ASX:APX) to deliver NPAT of US$41m, while consensus is expecting $US39.6m.
- Aristocrat Leisure (ASX:ALL) is holding its AGM today.
- There are a several companies going ex-dividend today also, including BHP Group (ASX:BHP), Challenger (ASX:CGF), OZ Minerals (ASX:OZL), Whitehaven Coal (ASX:WHC) and Woodside Petroleum (ASX:WPL).
Trading Ideas:
- Bell Potter have maintained its BUY rating on Coronado Global Resources (ASX:CRN) with a price target of $1.65. Bell Potter noted that the speed of CRN’s balance sheet repair has been remarkable and its strong cash generation at record met coal prices will likely hold up until at least mid-2022.
- Trading Central has a bullish signal on Steadfast Group (ASX:SDF), indicating that the stock price may rise from the close of $4.92 to the range of $5.28 - $5.36 in the next 19 days according to standard principals of technical analysis.
Amid heighted concerns for the Russia and Ukraine conflict, the ASX200 closed 1% lower yesterday. Only energy, consumer staples and healthcare sectors managed to post gains. Tech shares declined the most, sensitive to expectations of tighter monetary policy.
Cochlear (ASX:COH) advanced 9%, closing at $207.37, after a positive earnings report. This included a 20% rise in underlying net profit, as well as improved dividend. Other companies that made the top 10 after reporting their earnings yesterday included Costa Group Holdings (ASX:CGC), HUB24 (ASX:HUB), and Coles (ASX:COL). Meanwhile, Nanosonics (ASX:NAN) declined the most after reporting a large profit fall. Its share price closed just over 13% lower.
The most traded stocks by Bell Direct clients yesterday included Star Entertainment (ASX:SGR), Alumina (ASX:AWC) and BHP Group (ASX:BHP).
European markets closed mixed, while US equities were in the red. The Dow dropped 480 points or 1.4%, falling for the fourth straight session. The S&P500 down 1% and the Nasdaq down 1.2%. It was a negative start to the trading week, after the Presidents’ Day holiday, as market sentiment was dented by intensifying concerns between Russia and Ukraine. Additionally, expectations of tighter monetary policy have put pressures on the market.
What to watch today:
* Australian shares are expected to rise. The SPI futures are suggesting a 0.28% lift at the open this morning.
* The oil price is trading at US$92, after jumping more than 4% to an over 7-year high, on worries of the possibility of supply disruptions as tensions escalate in Europe.
* The gold price reached its highest level in nearly 9-months, while the seaborne iron ore price is higher at US$143 a tonne.
* Some companies that are reporting today include APA Group (ASX:APA), Domino’s Pizza (ASX:DMP), WiseTech (ASX:WTC), Rio Tinto (ASX:RIO), St Barbara (ASX:SBM) and Woolworths (ASX:WOW).
* Stocks going ex-dividend today include AGL Energy (ASX:AGL), Codan (ASX:CDA), JB Hi-Fi (ASX:JBH), Magellan Financial Group (ASX:MFG), and Netwealth Group (ASX:NWL). Remember this often sees shares fall as investors take their profits.
Trading Ideas:
* Bell Potter have a Speculative Buy rating on Cluey (ASX:CLU). Cluey is an education technology company, providing personalised online tutoring and educational services for school students. The company delivered a strong half-year report with metrics broadly in-line with Bell Potter’s forecasts. Bell Potter have a $1.50 valuation on the CLU. The stock last closed at $1.00, implying 50% share price growth in a year.
* Trading Central have identified a bullish signal in Woolworths (ASX:WOW), indicating that the stock price may rise from the close of $35.20 to the range of $36.60 to $36.90, over 20 days, according to the standard principles of technical analysis. Woolworths is also set to report its half year earnings today. Bell Potter expect NPAT of $808.2m.
The Aussie share market started the new trading week in the green, closing 0.16% higher yesterday, as news came in mid-session that the US and Russian President have agreed to meet, which eased some fears of an imminent invasion of Ukraine.
Sectors wise, the utilities sector led the way, lifting over 3%. Most of the other sectors also rose, except for the tech sector, healthcare sector, and consumer discretionary sector which fell.
The a2 Milk Company (ASX:A2M) jumped 11% after releasing its half-year results. While a disappointing decline was posted, some upbeat commentary from its management seems to have offset the profit miss. AGL Energy (ASX:AGL), lifted 11% after announcing its board had rejected a takeover offer from Atlassian billionaire Mike Cannon-Brookes and Canada’s Brookfield Asset Management, stating that the unsolicited bid of $7.50 a share undervalued the company. Meanwhile, tech stocks like Zip (ASX:Z1P), Block (ASX:SQ2) and Tyro Payments (ASX:TYR) were amongst the worst performers.
Some of the most traded stocks by Bell Direct clients yesterday included AVZ Minerals (ASX:AVZ), Lake Resources (ASX:LKE), AGL Energy (ASX:AGL), as well as Fortescue Metals (ASX:FMG).
Across the sea, the German DAX dropped 3%, the CAC fell 2%, and the FTSE lost 0.4%. While Wall Street was closed on Monday for the President’s Day holiday.
What to watch today:
- As European stocks plunged and markets continued to be shaken by the tensions in Ukraine, the futures are suggesting the Aussie share market will open about 1% lower this morning.
- The oil price lifted more than 1%, currently around US$93 a barrel. The gold price is also benefitting, up 0.35%. While the seaborne iron ore price was down 1.9% to US$141 a tonne.
- Reporting season wise, we’ll hear from mining company Alumina (ASX:ALU), Costa Group Holdings (ASX:CGC), Cochlear (ASX:COH), lottery company Jumbo Interactive (ASX:JIN), as well as Coles (ASX:COL). Bell Potter expects Coles to deliver NPAT of $538.4m, while consensus is expecting $506m.
- Companies going ex-dividend today include Amcor (ASX:AMC), IPH Limited (ASX:IPH), Tabcorp (ASX:TAH) and Wesfarmers (ASX:WES).
Trading Ideas:
- Citi have maintained its BUY rating on Zip (ASX:Z1P) with a price target of $3.65, after the BNPL provider gave an interim update on its half-year 2022 results yesterday morning. Zip reported its Cash Earnings Before Tax, Depreciation and Amortization (EBTDA) is expected to be a loss of $108.1m. This was materially lower than Citi’s expectation of a $38m loss. So keep watch of Zip as the company is set to release its results in full this Thursday.
- Finally, Trading Central has a bearish signal on Super Retail Group (ASX:SUL), indicating that the stock price may fall from the close of $11.63 to the range of $10.60 - $11 in the next 17 days according to standard principals of technical analysis.
On Friday the local market fell just over 1%. All industry sectors closed in the red, with utilities and healthcare falling the most.
On the ASX200 leader board, Magellan Financial Group (ASX:MFG) gained over 18%, after reporting a profit and dividend increase. MFG’s half-year earnings beat market forecasts with NPAT of $251.6 million, up 24% from this time last year, and an interim dividend $1.10, which is a 13% increase. Meanwhile, QBE Insurance (ASX:QBE) declined the most on Friday, after reporting full-year 2021 results that fell short of market expectations.
The most traded stocks by Bell Direct clients included BHP Group (ASX:BHP), Commonwealth Bank of Australia (ASX:CBA) and Macquarie Group (ASX:MQG), as well as Amcor (AXS:AMC), Lake Resources (ASX:LKE) and Fortescue Metals (ASX:FMG).
US equities were lower as the Russia and Ukraine conflict continues to put investors on edge. On Friday the Wall Street Journal reported that the US expect an attack from Russia in a few days. Friday was also a volatile day for the US market with many stocks, indexes and ETFs set to expire.
What to watch today:
- Following Wall Street, the SPI futures are suggesting the ASX200 will open 0.7% lower at the open this morning.
- The price of oil is lower, as escalating violence in Ukraine heightened concerns over supply disruptions from a possible war with Russia, offsetting prospects of Iranian oil returning to global markets.
- The gold price is steady at US$1,897 an ounce, while the seaborne iron ore price is lower at US$141 a tonne.
- Companies reporting their earnings results today include: a2 Milk (ASX:A2M), AMA Group (ASX:AMA) and Pilbara Minerals (ASX:PLS). Bell Potter expect PLS to report NPAT of $137 million. They currently have a Neutral – High Risk rating on the stock.
- Santos (ASX:STO) and Vicinity Centres (ASX:VCX) are set to go ex-dividend today.
- In economic news, the Manufacturing and services flash PMI will be released this morning. This is a forward-looking estimate of the final PMI for February, which will be released next week.
Trading Ideas:
- Bell Potter maintain their BUY rating on Nickel Mines (ASX:NIC), and have decreased their price target from $1.89 to $1.83. NIC last closed at $1.36 implying 34.6% share price growth in a year.
- Trading Central have identified a bullish signal in Global Lithium Resources (ASX:GL1), indicating that the stock price may rise from the close of $1.50, to the range of $2 to $2.10, over 20 days, according to the standard principles of technical analysis.
The Aussie share market advanced over 1% this week (Mon-Thu), with CSL's (ASX:CSL) strong report helping the healthcare sector rally more than 7%.
In this week’s wrap, Sophia covers:
- (0:46) Sims' (ASX:SGM) share price up over 20% after strong results
- (1:20) Gold companies performing well as the gold price lifts
- (2:00) Why other major mining stocks fell
- (5:19) Three company results which beat broker expectations
- (6:14) The reporting results to watch next week
- (6:50) The latest unemployment rate release
The ASX200 advanced 1.1% yesterday, powered by strong earnings results from companies like CSL (ASX:CSL), Treasury Wine Estates (ASX:TWE) and Vicinity Centres (ASX:VCX). The gains managed to offset losses from major resource stocks, following falls in both iron ore and oil prices.
Sectors wise, the healthcare sector led the way, supported by CSL’s strong gain, while the materials and energy sectors posted small losses.
Liontown Resources (ASX:LTR) jumped an impressive 18% yesterday, after it was announced that the company would supply Tesla with more than 100,000 tonnes of lithium spodumene concentrate a year. That’s LTR’s second major contract in two months. And six of the other best performers were companies that reported results. Meanwhile, Netwealth (ASX:NWL) came under pressure yesterday. Its share price fell nearly 10% after its results release disappointed the market. The biggest surprise was its higher-than-expected costs on new staff and technology.
The three most traded stocks by Bell Direct clients yesterday were CSL (ASX:CSL), BHP Group (ASX:BHP) and Senex Energy (ASX:SXY).
Moving to the US, the market was mixed, the S&P500 managed to close slightly higher, while the Dow Jones and Nasdaq both closed slightly lower. During the session, the minutes from the Fed’s January meeting were released, which to investors relief, didn’t indicate that the Fed would move any faster than already expected in hiking interest rates.
Following the mixed session on Wall Street, the futures are suggesting the Aussie share market will open slightly higher this morning.
What to watch today:
- In commodities, the gold price managed to gain 1% as the Russia-Ukraine tensions remain high. The oil price was trading higher, but is now trading down over 1% to US$90 a barrel. The lithium price is trading up 1.3% and the platinum price is also up 3.6%. While the seaborne iron ore price is trading 1.8% lower to US$142 a tonne.
- Economic news wise, the unemployment rate for January will be released today. As a reminder, the unemployment rate came in at 4.2% in December, which was the lowest rate in more than 13 years. And the RBA recently stated that the unemployment rate could fall to 3.75% by the end of 2023, which would be the lowest rate since 1974. So keep watch today at 11:30am AEDT.
- Reporting season: Today we’ll hear from companies including Wesfarmers (ASX:WES), Telstra (ASX:TLS), Whitehaven Coal (ASX:WHC), Magellan Financial Group (ASX:MFG), Newcrest Mining (ASX:NCM) and Goodman Group (ASX:GMG).
- GrainCorp (ASX:GNC) is holding its AGM today, while GPT Group (ASX:GPT) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained its HOLD rating on Fortescue Metals (ASX:FMG) and have increased their price target to $19.09 (previously $18.33). Bell Potter stated that FMG’s result yesterday was in-line or marginally below its expectations. And despite the cut to its interim dividend, it’s important to recognise that it was in fact FMG’s second highest ever. Bell Potter also noted that the key to closing the gap for them to upgrade FMG to a BUY remains with Fortescue Future Industries. While FFI is critical to helping FMG achieve its objective of decarbonisation by 2030, its value accretion and optionality added to the core business cannot be quantified.
- Trading Central has a bullish signal on Scentre Group (ASX:SCG), indicating that the stock price may rise from the close of $3.15 to the range of $3.53 - $3.63 in the next 30 days according to standard principals of technical analysis.
The ASX200 closed slightly lower yesterday, as the energy sector lost over 3%, even with the price of oil improving again yesterday. However, energy has been performing very well, so yesterday’s fall may be due to investors taking profits. A few sectors still rose, including tech, real estate, consumer staples and discretionary, communication and industrials.
Sims (ASX:SGM) shares jumped 13.7% off the back of fantastic earnings report. Sales revenue was up 73.9%. Statutory EBIT up 334.9% and underlying EBIT up 541.3%, from the prior corresponding period. Seek (ASX:SEK) also advanced after reporting its earnings. Revenue was up 59% to $517.2 million and NPAT was up 32% to $88.1 million. Dexus (ASX:DXS) also gained after its earnings report.
The most traded stocks by Bell Direct clients yesterday were major banks Westpac (ASX:WBC) and National Australia Bank (ASX:NAB).
European and US equities both closed higher, as Russia and Ukraine tensions started to de-escalate. Russia announced it had begun returning some troops to deployment bases. In New York, the Dow jumped 400 points, closing 1.2% higher after a 3-day losing streak. The S&P500 gained 1.6% and the Nasdaq gained 2.5%.
What to watch today:
- The SPI futures are suggesting a 0.93% rise at the open this morning.
- Oil has fallen from its recent peaks. After reaching over 7-year highs on Tuesday, oil is currently trading 3.8% lower at US$91.84 a barrel.
- The gold price has fallen after sitting at its best levels in 8-months. Gold is 1% lower at US$1,851.68 an ounce.
- The seaborne iron ore price is 1.3% lower at US$144 a tonne.
- In economic news, yesterday the RBA released its meeting minutes. There were no new surprises here. The RBA reiterated that they’ll be patient with any interest rate change. And that wages are to grow at the same pace as inflation. With this in mind, yesterday Commonwealth Bank brought forward its tip for the first rate rise of the year. CBA previously said August, however, now expect a potential hike in June, where we may see a 15-basis point lift.
- CSL (ASX:CSL) is reporting today, and we’ll be bringing you a full report on CSL later today.
- Commonwealth Bank (ASX:CBA) and Insurance Australia (ASX:IAG) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter maintain their BUY rating on Money3 Corporation (ASX:MNY), and have increased their price target from $4.35 to $4.60, after the company reported a sold half year result. MNY last closed at $3.12, implying 47.4% share price growth in a year.
- Trading Central have identified a bullish signal in Woolworths (ASX:WOW), indicating that the stock price may rise from the close of $34.29 to the range of $35.80 to $36.20, over 26 days, according to the standard principles of technical analysis.
Yesterday, the Aussie share market managed to claw back some of its losses from Friday, gaining 0.37%. Leading the gains were oil and gold stocks, following escalating fears of a Russian invasion of Ukraine.
Looking at the sector performances, only six out of 11 sectors closed higher. The energy sector gained the most, up over 3%, while the healthcare sector declined 1.4%.
Gold miners dominated the leaderboard, including Regis Resources (ASX:RRL), Evolution Mining (ASX:EVN), and Northern Star Resources (ASX:NST). The best performing stock on the ASX200 was Beach Energy (ASX:BPT), up an impressive 9.4%, after the company reported a solid first-half result, which included a 26% increase in EBITDA to $513 million. Meanwhile, the worst performing stocks were NOVONIX (ASX:NVX), Imugene (ASX:IMU) and Liontown Resources (ASX:LTR), all falling over 7%.
The most traded stock by Bell Direct clients yesterday was JB Hi-Fi (ASX:JBH). The company released strong half-results yesterday, and announced a $250m share buyback, which sent its share price up 5.4%. Bell Potter maintain their HOLD rating on the stock but have increased its price target to $51.85, from $49.60.
In the US, all three benchmarks closed lower, as investors evaluate concerns about the Fed’s next plan for interest rate hikes, as well as the tensions between Russia and Ukraine. And earnings results are expected to ramp up again this week, with Nvidia, Walmart, Shopify and more scheduled to report.
Following the negative session on Wall Street, the futures are suggesting the Aussie share market will open 0.9% lower this morning.
What to watch today:
- In economic news, the RBA will release its meeting minutes for February. The RBA is currently relatively dovish on rate hikes as local inflation is not as out of control as in the other major economies.
- Reporting season: It’s a big week of results and today, the biggest company on the ASX, BHP Group (ASX:BHP) will release its half-year results. Stay tuned for our separate video where we’ll take you through the highlights. Some other companies reporting today include Ansell (ASX:ANN), Dexus (ASX:DXS), Sims (ASX:SGM), Adore Beauty (ASX:ABY), Elmo Software (ASX:ELO) and Seek (ASX:SEK).
- Computershare (ASX:CPU) is set to go ex-dividend today.
- In commodities, the oil price hit 7-year highs, boosted by Russia and Ukraine’s tensions. The oil price is currently trading at about US$95 a barrel. And in a similar tale, the gold price also gained and is trading about 0.6% higher to US$1,872 an ounce. The lithium, palladium and silver price are all trading higher, while the seaborne iron ore price is trading 0.5% lower to US$150 a tonne.
Trading Ideas:
- Bell Potter have maintained its BUY recommendation on Mineral Resources (ASX:MIN) and have increased its price target by a modest 20% to $61.35. Bell Potter believe MIN’s recent financial results were significantly impacted by the large decline in realised iron ore prices, however highlighted that the business made strong progress in the quarter towards its strategic goals, including expanding its iron ore export capacity, evolving its iron ore business to a low-cost base that will make it resilient to low iron ore price environments, and lastly, MIN’s ability to capture the downstream margins in its lithium business. As for other broker’s ratings on MIN, Macquarie have an Outperform rating with a $70 price target, while Ord Minnett have a SELL rating and $45 price target.
- Trading Central has a bullish signal on Westgold Resources (ASX:WGX). This signal indicates that the stock price may rise from the close of $2.03 to the range of $2.29 -$2.35 in the next 40 days, according to standard principles of technical analysis.
Despite US inflation data reaching a 40-year high, Australian shares gained for the second consecutive week. However, on Friday the ASX200 dropped 1%, with all but the materials sectors in the red. US consumer inflation for January rose 7.5%, far above the expected figure. The S&P US 2-year and 10-year treasury bond indices fell 0.5% and 1% in response. Goldman Sachs economists have increased their forecast for the Fed to hike interest rates 7 times this year, up from 5. On Friday, the RBA Governor Phillip Lowe said that if US inflation forced the Fed to raise rates faster than expected, markets are at risk of an “abrupt adjustment”.
On Friday’s ASX200 leaderboard, Unibail-Rodamco-Westfield (ASX:URW) made the most gains, closing 6.5% higher, after announcing a sale and joint centre to a French shopping centre, agreeing to sell 45% of Westfield in Paris. URW also reported its full-year 2021 results, which saw “tenant sales approaching pre-COVID levels” and its portfolio was valued at €54.5 billion as of the 31st December. Meanwhile the worst performer was language testing and student placement company IDP Education (ASX:IEL), after reporting its earnings. However, Goldman Sachs were pleased with the company’s half year results and have retained their BUY rating.
The most traded stocks by Bell Direct clients on Friday included CSL (ASX:CSL), AVZ Minerals (ASX:AVZ), Macquarie Group (ASX:MQG) and Westpac (ASX:WBC).
US equities closed lower, as worries of an imminent Russian invasion of Ukraine add onto the list of concerns about interest rates and inflation. The S&P500 closed 1.9% lower after the White House asked all US citizens to leave Ukraine. The Dow lost 1.4% and the Nasdaq dropped 2.8%.
What to watch today:
- Following Wall Street, the SPI futures are suggesting the ASX200 will fall 0.46% at the open this morning.
- In commodities, Russia is one of the world’s largest energy producers and the warning for US citizens to leave Ukraine has seen the price of oil rise 3.6%, trading at US$93 a barrel. However, oil prices have been rising before the warnings, most likely due to a statement from the International Energy Agency that oil market supplies are already tight. Gold is trading almost 2% higher at US$1,862.60 an ounce, while the seaborne iron ore price is lower at US$150.87 a tonne.
- Reporting season is in full swing this week, with many companies set to report their earnings results. A few reporting today include Boral (ASX:BLD) and JB Hi-Fi (ASX:JBH). Bell Potter expect Boral to report NPAT of $137.6 million and JB Hi-Fi to report NPAT of $287.9 million.
- Suncorp (ASX:SUN) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained their BUY rating on DGL Group (ASX:DGL) and have increased their price target from $3 to $3.50, after the company delivered half-year results well ahead of expectations. They reported first-half normalised EBITDA of $23.0 million up 139% on the prior corresponding period, significantly exceeding Bell Potter’s $17.9 million.
- Trading Central have identified a bullish signal in Focus Minerals (ASX:FML) indicating that the stock price may rise from the close of $0.28 to the range of $0.34 to $0.36 over 25 days, according to the standard principles of technical analysis.
The Aussie share market rallied this week, lifting 2.36% (Mon-Thu). However, as US inflation came in at a 40-year high on Thursday evening, Aussie investors will feel the pressure on Friday.
In this week’s wrap, Sophia covers:
- (0:40) Why travel stocks are back in vogue
- (1:04) Nanosonics (ASX:NAN) falling 7% after a sales agreement revision
- (2:18) Opportunities in the hydrogen market
- (5:10) How we’re tracking so far this reporting season
- (6:28) Three economic news releases to watch
Yesterday, the Aussie share market charged over 1% higher to 7,268 points. That marks a two-week high for the benchmark ASX200 index. The lift follows CBA’s strong half-year results, which also helped the other major banks post decent gains. Looking at the sector performances, the tech sector outperformed, up 4.2%, after it took a solid lead from Wall Street, while both the materials sector and energy sector posted losses, partly due to the fall we saw in the iron ore price.
Computershare (ASX:CPU) lifted 11.2% after the company released a strong half-year and guidance upgrade. Imugene (ASX:IMU) also gained, after its company director acquired 15 million shares, displaying his confidence in the company. Meanwhile, Mineral Resources (ASX:MIN) dropped nearly 9% after following its mixed results that recognised a loss in both revenue and statutory profit.
The most traded stock by Bell Direct clients yesterday was Fortescue Metals (ASX:FMG). Its share price fell 3.6% following the rapid decline in the iron ore price as Chinese officials step up their efforts to control the iron ore price. Also highly traded was Lake Resources (ASX:LKE), Commonwealth Bank (ASX:CBA) and CSL (ASX:CSL).
In the US, all three benchmarks closed in the green, with the Nasdaq jumping as investors continued to buy the January tech dip. Tech stocks like Shopify, Etsy, Meta and Zoom all rose. And investors are now preparing for Thursday’s consumer price index report, which will give an update on the inflation picture. The result could push the Federal Reserve closer to considering its single-largest rate hike in more than two decades.
Today, following the positive session over on Wall Street, the futures are suggesting the Aussie share market will open 0.31% higher this morning.
What to watch today:
- National Australia Bank (ASX:NAB) is one to watch today when it releases its first quarter update. Bell Potter analysts are forecasting around $1.59 billion in cash earnings and 49 cents cash earnings per share.
- AGL Energy (ASX:AGL) is set to release its half-year 2022 results. It is widely expected that the energy company’s results will disappoint the market, after the company faced a very tough half. The analysts at Morgans are expecting AGL’s first-half earnings to sink to $97 million.
- Also reporting results today is ASX (ASX:ASX), AMP (ASX:AMP), Downer EDI (ASX:DOW), Mirvac Group (ASX:MGR), Cimic Group (ASX:CIM) and Unibail-Rodamco-Westfield (ASX:URW).
- Virgin Money UK (ASX:VUK) is set to go ex-dividend today.
- In commodities, the oil price remained stable at US$90 a barrel. The gold price gained 0.26% on a softer dollar and yields, while the seaborne iron ore price is trading 0.8% lower to US$147 a tonne.
Trading Ideas:
- After its results yesterday, Bell Potter have upgraded its rating on Commonwealth Bank (ASX:CBA) from a HOLD to a BUY, and have maintained its price target at $108. While Citi has a SELL rating and $97 price target and Macquarie has a Underperform rating and $88.50 price target on the stock.
- Trading Central has a bearish signal on Mineral Resources (ASX:MIN). This signal indicates that the stock price may fall from the close of $52.72 to the range of $41 -$44 in the next 9 days, according to standard principles of technical analysis.
Yesterday the ASX200 closed in the green. The materials sector made strong gains as iron ore in the spot market rose. Meanwhile tech shares declined the most, as Australia’s 10-year bond yield exceeded 2.1%, reaching the highest level since the beginning of 2019. This saw a sell-off in tech stocks, which tend to be more sensitive to interest rates.
On the ASX200, travel stocks gained for a second session. Webjet (ASX:WEB), Flight Centre (ASX:FLT) and Corporate Travel Management (ASX:CTD) all made the leaderboard. Casino owner Skycity Entertainment (ASX:SKC) and Star Entertainment (ASX:SGR) also made the top 10, boosted by confidence for tourism.
The most traded stock yesterday by Bell Direct clients was A2B Australia (ASX:A2B), which is home to brands such as 13cabs, Cabcharge and EFT Solutions. Its share price gained over 12% yesterday, after the departure of chief executive Andrew Skelton. The company also launched a strategic review of operations.
European markets closed mixed as investors await US inflation data, out later this week, while US equities gained. The Dow closed up 1.06%, the S&P500 up 0.84 and the Nasdaq up 1.28%.
The ASX200 is set open higher. The SPI futures are suggesting a 0.27% rise at the open this morning.
What to watch today:
- In economic news, yesterday NAB’s business confidence Index for January was released, with confidence bouncing back to 3 index points, from -12 points in December. Today, Westpac’s Consumer Confidence Index for February will be released at 10:30am AEDT.
- The oil price has fallen to US$89.64 a barrel, as attention was turned to the Iran nuclear talks that are set to resume today.
- Gold is higher, trading at US$1,826 an ounce, as the dollar rebounded ahead of US inflation data later in the week.
- The seaborne iron ore price is trading at US$148.83 a tonne.
- Commonwealth Bank (ASX:CBA) reported its half-year results this morning, delivering strong financial and operational performance. Statutory NPAT increased by 26% and CBA declared a $1.75 fully franked interim dividend, up 17% from this time last year. Look out for our full report on CBA later today.
- Other companies reporting their earnings results today include Centuria Capital Group (ASX:CNI), Dexus (ASX:DXS), Mineral Resources (ASX:MIN) and Northern Star Resources (ASX:NST).
- ResMed (ASX:RMD) is set to go ex-dividend today, which may see its share price fall as investors take their profits.
Trading Ideas:
- Bell Potter and Macquarie have different views on global mining-tech company Imdex (ASX:IMD), after the company reporting its earnings this week. Half-year revenue is up 35% to $167.8 million and NPAT is up more than 80% at $24.4 million. And Imdex declared a fully franked interim dividend of 1.5 cps. Following the report, Bell Potter have downgraded IMD from a BUY to a HOLD, maintaining a $3 price target. On another note, Macquarie retain their Outperform rating on IMD and have increased their price target from $2.90 to $3.30. IMD’s revenue and earnings beat Macquarie’s expectations by 13%.
- Trading Central have identified a bullish signal in Mincor Resources (ASX:MCR), indicating that the stock price my rise from the $1.71 to the range of $2.06 - $2.14, within 18 days, according to the standard principles of technical analysis.
Yesterday, the Aussie share market posted a small loss of 0.13%, in what was a choppy session. ANZ reported worse-than-expected first quarter margins, which saw its share price decline nearly 2% and the Australian government announced that our international COVID-19 border closures would end on February 21.
Looking at the sector performances, the energy sector outperformed, up 1.6%, benefitting from the recent gains in both oil and gas commodity prices, while the healthcare sector led the losses, down 1.3%.
GrainCorp (ASX:GNC) led the way, rising an impressive 12.3%, after revealing that it’s expecting a favourable outlook for financial year 2022. And travel stocks were back on top following the government’s announcement that Australians would be welcoming back international travellers later this month. Flight Centre (ASX:FLT), Corporate Travel Management (ASX:CTD), Webjet (ASX:WEB) and Qantas (ASX:QAN) all gained more than 4%. Meanwhile, Magellan Financial Group (ASX:MFG) declined 11%, after it was announced that its director and chairman, Hamish Douglass would be taking a leave of absence.
The most traded stock by Bell Direct clients yesterday, was iron ore miner Champion Iron (ASX:CIA). Its share price fall may have been because the company traded ex-dividend yesterday. As a reminder, a company’s share price typically drops by the amount of the dividend paid to reflect the fact that new shareholders are not entitled to that payment.
In the US, both the S&P500 and Nasdaq started the week on a negative note as quarterly results continued to be a source of volatility, and as investors await key US inflation data on Thursday. The Dow closed flat, the S&P500 down 0.37% and the Nasdaq also down 0.58%. And Facebook-parent Meta shares have fallen another 5%, continuing its post-earnings slide.
Today, following the negative session over on Wall Street, the futures are suggesting the Aussie share market will open 0.16% lower this morning.
What to watch today:
- In economic news, business confidence data for January will be released this morning, which will provide further detail on how business confidence is holding up during the Omicron outbreak. Trading Economics expects today’s reading for January to come in at -14.
- Suncorp (ASX:SUN) will be on watch today as the company is set to release its half-year results. Bell Potter currently has a BUY rating on the stock and is expecting NPAT to come in at $267.6m. While consensus is expecting a more modest NPAT of $290.5m.
- Also reporting results today is Shopping Centres Australasia Property Group (ASX:SCP), G.U.D Holdings (ASX:GUD) and Charter Hall Long Wale REIT (ASX:CLW).
- Keep an eye on Macquarie Group (ASX:MQG) as the company will be releasing its operational briefing today which will include an update on the investment bank’s performance during the third quarter of financial year 2022.
- In commodities, the oil price fell following signs of progress in the US-Iran nuclear talks. The WTI crude oil price dropped nearly 1% to US$91.51 a barrel. On the flip side, the gold price climbed to a more than one-week high, as inflation risks boost the safe-haven’s appeal. And the seaborne iron ore price is trading 3.2% higher to US$150 a tonne.
Trading Ideas:
- Bell Potter has upgraded its rating on software company Altium (ASX:ALU) from a HOLD to a BUY, and have decreased its price target by 11% to $40. Bell Potter believe potential catalysts for the stock include 1) a strong first-half financial year 2022 result, 2) an upgrade in its financial year 2022 guidance and 3) a renewed and increased takeover offer from Autodesk. Now ALU last closed at $34.50, so that implies about 16% share price growth in a year.
- Trading Central has a bullish signal on Insurance Australia Group (ASX:IAG). This signal indicates that th
On Friday, the local market ended a three-week losing streak, with 10 of the 11 industry sectors rising higher. The ASX200 gained 0.6% on Friday, as reporting season kicked off.
Liontown Resources (ASX:LTR) gained over 6%. After the market close on Thursday, the company announced the completion of its share purchase plan (SPP). News Corp (ASX:NWS) reporting its highest earnings since its separation from 21st Century Fox in 2013. NWS gained 5.7%. Meanwhile, Seek (ASX:SEK) declined the most, after Goldman Sachs reiterated its SELL rating and decreased its price target by 15% to $27.30.
The most traded stock by Bell Direct clients was Seven West Media (ASX:SWM). On Friday, UBS reiterated its BUY rating on SWM, with a $0.95 price target. Other highly traded stocks included a few ETFs, such as HLTH, VAS and VETH. While clients also traded CSL (ASX:CSL), BHP Group (ASX:BHP), Australia and New Zealand Banking Group (ASX:ANZ), BrainChip (ASX:BRN), Westpac (ASX:WBC) and Adelaide Brighton Cement (ASX:ABC).
In the US, we saw Facebook suffer the largest share market hit, by value and points, in market history. Facebook’s parent company Meta’s stock price fell by 27% in one day, equivalent to over US$230 billion in lost value. In the following session on Friday, the tech sector recovered the losses led by Facebook, by a 13.5% surged in Amazon. Amazon reported strong quarterly earnings, which also saw the company largest one-day gain since 2015. The S&P500 and the Nasdaq ended their best week of the year, while the Dow Jones closed slightly in the red.
The SPI futures are suggesting the ASX200 will fall 0.58% at the open.
What to watch today:
- The oil price has surged higher, trading at US$91.93. US crude prices hit their highest price since September 2014, at US$93 per barrel, following a large storm that swept across the US and disrupted some oil production in the Permian Basin region. Additionally, OPEC stuck to its plan to gradually release more barrels into a strengthening market.
- The price of gold is trading higher at US$1,807 an ounce.
- While the seaborne ire ore price is lower at US$145 a tonne.
- Australia and New Zealand Banking Group (ASX:ANZ) and James Hardie (ASX:JHX) will report their quarterly results, and Argo (ASX:ARG) and Imdex (ASX:IMD) will report their half year results.
- Iron ore miner Champion Iron (ASX:CIA) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have upgraded Pro Medicus (ASX:PME), a leading heath imaging IT provider, from a HOLD to a BUY, and have amended their price target to $55 from $62. The broker expects PME to deliver strong earnings growth at the upcoming reporting. PME last closed at $45.58, implying 20.7% share price growth in a year.
- Trading Central have identified a bullish signal in Australian Clinical Labs (ASX:ACL), indicating that the stock price may rise from the close of $5.08 to the range of $6.00 to $6.20, within 17 days, according to the standard principles of technical analysis.
The Aussie share market has managed to post an impressive gain of 1.3% this week (Mon-Thu). Leading the gains were the energy and the utilities sectors, while the tech sector declined slightly.
In this week’s wrap, Sophia covers:
- (0:28) Nufarm (ASX:NUF) gaining after posting revenue growth in Q1
- (1:16) Why Ansell (ASX:ANN) experienced a large sell-off
- (2:04) The ETFs Bell Direct clients were trading this week
- (3:36) What to expect this reporting season
- (6:05) Two economic news releases to watch
Access Bell Direct's reporting season calendar here.
Yesterday, the Aussie share market continued its positive streak in February, closing 1.2% higher to pop back over 7,000 points. We also heard from RBA Governor Philip Lowe, who stated that a rate rise later this year was a plausible situation. And BHP (ASX:BHP) once again became the largest company on the Aussie share market after officially completing the unification of its Australian and UK listings.
In sector performances, nearly all sectors closed in the green, with the energy and materials sectors gaining the most. On the ASX200 stock leader board, eight mining stocks were amongst the best performers. Auckland International Airport (ASX:AIA) pushed 5.4% higher and Worley (ASX:WOR) gained about 5%, benefiting from surging oil prices. Meanwhile, the worst performing stocks included Credit Corp Group (ASX:CCP), Block (ASX:SQ2) and Amcor (ASX:AMC). Amcor fell 3.5% despite announcing a 12% jump in its first-half sales.
The most traded stocks by Bell Direct clients yesterday included software company BrainChip (ASX:BRN), which topped the list, lifting over 6% after announcing the receipt of another patent in the US. Another highly traded stock was Mineral Resources (ASX:MIN), its share price gained 2.2% after the company reported that the Western Australian government is set to increase iron ore export capacity at the Port of Port Hedland.
In the US, stocks rose for the fourth straight day, the Dow jumping over 200 points, the S&P500 climbing nearly 1% and the Nasdaq pushing 0.5% higher. The stock that led the gains was Alphabet, after its quarterly results beat analyst expectations. And Facebook-parent Meta shares have tumbled more than 15% in extended trading after a disappointing earnings report was released, where they also gave a weaker than expected forecast.
Today, the futures are suggesting the Aussie share market will open 0.09% higher this morning.
What to watch today:
- In economic news, Australia’s balance of trade data for December will be released today. That’s the difference between what we export vs. what we import. Australia’s trade surplus declined to 9.42 billion in November, that was our smallest trade surplus since April.
- Westpac (ASX:WBC) will be on watch today as the company has released its first quarter update this morning. The company delivered first quarter cash earnings of $1.58 billion, which while does represent growth, does fall short of Bell Potter’s forecasting of $1.82 billion. Aggressive competition also continued to weigh on margins.
- Nick Scali (ASX:NCK) will be releasing its first quarter 2022 results today. Bell Potter has a BUY rating on the stock and is expecting NPAT to come in at $29.1m, while consensus expects a slightly more modest NPAT of $30.5m.
- Moving to commodities, OPEC have decided to green-light the return of 400,000 barrels per day for March, despite pressure from the US and India. The gold price gained as the US dollar and Treasury yields fell, following a disappointing ADP jobs report, where companies unexpectedly cut 301,000 jobs in January. And the seaborne iron ore price is trading 0.86% higher to US$140 a tonne.
Trading Ideas:
- Bell Potter has upgraded its rating on Select Harvests (ASX:SHV) from a HOLD to a BUY with a price target of $7.10. This comes as SHV’s share price has fallen about 40% from its September 2021 highs and Bell Potter believe that the stock is trading at a modest discount. SHV last closed at $5.65, so that implies about 26% share price growth in a year.
- Trading Central has a bullish signal on Orica (ASX:ORI). This signal indicates that the stock price may rise from the close of $14.50 to the range of $15.30-$15.50 in the next 33 days, according to standard principles of technical analysis.
Yesterday local shares rose 0.5% after the RBA, in its first meeting of the year, formally ended its quantitative easing program, as inflation rises faster than expected. This was the bond buying program introduced in late 2020, as an emergency measure during the pandemic, which kept bonds anchored near record lows, to help keep borrowing costs for households and businesses low. And as expected, the central bank also held the interest rate at 0.1%.
Yesterday 10 of the 11 industry sectors closed with gains. However, the market was weighed by losses in materials, as the price of iron ore declined.
This saw BHP (ASX:BHP), Rio Tinto (ASX:RIO) and other mining stocks among the worst performers. Meanwhile ASX tech stocks were the top performers, as the Nasdaq rebounded and Block (formally known as Square), officially took over Afterpay. Appen (ASX:APX) lead the gains, up almost 8%. Block (ASX:SQ2) and Zip (ASX:Z1P) were also among the top 10.
The most traded stocks by Bell Direct clients yesterday included BHP (ASX:BHP) and Vanguard ETFs (ASX:VAS) and (ASX:VGS).
European stocks started February on a positive note, and US stocks rose for the third day, extending the market’s comeback from the sell-off we saw in January. The Dow was up 0.8%, the S&P500 up 0.7% and the Nasdaq up 0.8%.
Aussie shares are set to open higher. The SPI futures are suggesting a 0.68% rise at the open this morning.
What to watch today:
- Amcor (ASX:AMC) will report its results today.
- Prospects of rising demand as economies recover, and concerns over tight supplies continue to support the oil market. Oil prices are at 2014 highs and increased 17% in January, which is the strongest gain since February 2021. The price of oil is currently trading higher, above US$88 a barrel.
- Gold prices also edged higher for a second consecutive session, trading above US$1,800 an ounce. Gold lost almost 1.7% in January, mostly due to a general dollar weakness.
- The copper price also rose amid a weaker dollar.
- Iron ore has rebounded. Spot prices of iron ore are up with rising imports from China. The seaborne iron ore price is over 7% higher, trading at US$138 a tonne.
- Today at 12:30pm AEDT, the RBA Governor Philip Lowe will speak on the year ahead. The RBA has said that until annual wage growth nears 3%, interest rates won’t be lifted. Annual inflation is between the RBA’s 2-3% target but aren’t too convinced it will stay there. In terms of interest rates, the central bank is not in a hurry to make changes.
Trading Ideas:
- Bell Potter maintained their BUY rating on Bathurst Resources (ASX:BRL) and have increased their price target from $0.98 to $1.25. BRL last closed at $0.77, implying 57% share price growth in a year.
- Trading Central have identified a bullish signal in De Grey Mining (ASX:DEG), indicating that the stock price may rise from the close of $1.18. So we may see higher prices at least in the short term.
Yesterday, the Aussie share market closed 0.24% lower to 6,971 points in what was a choppy session for the benchmark index. For the month of January, the ASX200 posted a 6.3% loss, its biggest monthly drop since COVID-19 first hit nearly two years ago.
Looking at sector performance, the market was mixed. The tech sector managed to post an impressive gain of 3.7%, while the financials and consumer staples sectors fell the most.
On the ASX200 stock leader-board, six tech stocks led the gains, all enjoying a boost following Wall Street’s strong session on Friday. Afterpay’s parent, Block (ASX:SQ2) jumped 8.1% to $161.41, that’s its biggest one-day gain since it began trading on January 20, but still lower than its opening price of $176.63. Meanwhile, Ansell (ASX:ANN) took a 14.3% hit to its share price following an underwhelming trading update where the company blamed declining demand for single-use gloves and a margin crunch for the profit downgrade. Citi maintained its BUY recommendation on the stock but has reduced its price target to $37.50 (from $45.50). And another stock coming under pressure was NIB Holdings (ASX:NHF) and that comes after JP Morgan slashed its price target by 12% to $6.10.
As for the most traded stocks by Bell Direct clients yesterday, there were several ETFs that made the top ten. These included the BetaShares A200 and NDQ, Vanguard’s VAS and VGS, as well as ETF Securities’ Battery Tech & Lithium ETF (ASX:ACDC). Also gaining traction yesterday was Rio Tinto (ASX:RIO). Its share price came under pressure amid a renewed focus on the miner’s unresolved royalty dispute with Traditional Owners.
Moving to the US, tech stocks boosted both the Nasdaq and S&P500, while the Dow managed to gain about 400 points. Netflix and Spotify surged more than 10% and 12% respectively following upgrades from Citi, who cited last month’s pullback as an attractive time to buy. And Tesla also gained 8% on Monday after Credit Suisse upgraded the stock.
Today, the futures are suggesting the Aussie share market will open 0.26% higher this morning.
What to watch today:
- The key focus will be on the RBA as it meets for the first time this year. While a rate rise isn’t expected, the RBA could hint that one is nearer than it previously thought. Economists are expecting that the RBA will end its monetary stimulus, upgrade its economic forecasts, and potentially bring forward its interest-rate guidance during this meeting. Also out today, is preliminary retail sales for December.
- Reporting season wise, Credit Corp (ASX:CCP) will be releasing its half year results. Consensus expects the company will deliver NPAT of $42.7m and an interim dividend of 38 cents per share. Other stocks reporting include Centuria Industrial REIT (ASX:CIP) and Vulcan Energy Resources (ASX:VUL).
- In commodities, the oil price continues to rise, trading close to US$90 a barrel, off the back of both political tensions and a supply shortage. The gold price also rose, despite expectations for interest rate hikes by the Federal Reserve. The lithium price is trading up 2.7%. And the spot iron ore price is trading nearly 6% higher to US$143 a tonne.
Trading Ideas:
- Bell Potter has maintained its speculative BUY recommendation on leading Australian producer of goat dairy products, Bubs Australia (ASX:BUB) with an increased price target of $0.70 (previously $0.65). BUB closed 5.62% higher yesterday to $0.47, which implies nearly 50% share price growth in a year.
- Trading Central has a bullish signal on PointsBet (ASX:PBH). This signal indicates that the stock price may rise from the close of $4.86. The balance between buyers and sellers, recently dominated by the bears, is evening out. So, we may see higher prices ahead.
After broad selling across the market as the US Fed signalled rate rises, the local market rebounded on Friday, ending the week on a positive note. The market was boosted by positive earnings results in the US, with Atlassian and Apple providing strong quarterly earnings.
The ASX closed over 2% higher, with Imugene (ASX:IMU) in the lead. The biotech company gained 10.5% to $31.50, after announcing a new supply agreement with Swiss pharmaceutical company Roche. Meanwhile, gold miners were among the worst performers on Friday, as the price of gold dropped below US$1,800 an ounce. Ramelius Resources (ASX:RMS) fell to a 4-month low, down 8%, while Newcrest Mining (ASX:NCM) fell 6.4%. Both companies also reported quarterly results on Friday.
The most traded stocks by Bell Direct clients on Friday included BHP (ASX:BHP) and Rio Tinto (ASX:RIO) as the price of iron ore edged higher, in preparation for an increase in demand following the Beijing Winter Olympics.
European stocks saw their fourth straight week of losses, while US equities ended the week with gains. The Dow had its best day of 2022, up 1.65%. The S&P500 added 2.4% and Wall Street also saw a tech-led rally, with the Nasdaq gaining over 3%.
Despite the rally on Wall Street, the SPI futures are suggesting the ASX200 will drop 0.23% at the open this morning.
What to watch today:
- Oil is trading above US$87 a barrel, supported by fears of supply disruptions due to geopolitical risks in Ukraine. Additionally, the market is awaiting OPEC’s meeting next week. So watch energy producers Woodside Petroleum (ASX:WPL) and Santos (ASX:STO).
- The gold price has dropped below US$1,800 an ounce as the dollar and treasury yields jumped following the Fed’s hawkish updates.
- The seaborne iron ore price is higher, trading above US$130 a tonne.
- Pilbara Minerals (ASX:PLS) will release their second quarter update today. We will be looking at whether the company achieved its shipment guidance, as well as pricing with reports of record lithium price levels.
- Gold Road Resources (ASX:GOR) will release its quarterly production report and IGO (ASX:IGO) will release its earnings result.
Trading Ideas:
- Bell Potter maintain their BUY rating on National Australia Bank (ASX:NAB) with a $31 price target. NAB last closed at $27.25, implying 13.8% share price growth in a year.
- Trading Central have identified a bullish signal in Breville (ASX:BRG), indicating that the stock price may rise from the close of $27.52 to the range of $32.75 - $34.00. The pattern formed over 18 days which is roughly the period in which the target price range may be achieved, according to standard principles of technical analysis.
The Aussie share market took a dive this week, falling 4.7% (Mon-Thu), amid rising inflation, the global spread of the Omicron variant, and the risk that Russia will invade Ukraine.
In this week’s wrap, Sophia covers:
- (0:31) Codan (ASX:CDA) delivering a positive trading update
- (0:56) Why Adairs (ASX:ADH) lost 27%
- (1:27) The stocks Bell Direct clients were trading the most
- (1:50) The value of having a longer-term investment view
- (4:45) Three important economic news items coming up
Yesterday the ASX was closed for the Australia Day Public Holiday. On Tuesday however, Australian shares tumbled and the ASX200 closed 2.5% or 177.9 points lower. This was the second biggest sell-off this year, with an inflationary shock as CPI came in ahead of consensus and fears about higher interest rates, as well as the invasion of Ukraine. All sectors were in the red, with energy declining the most.
The best performer was Codan (ASX:CDA), a manufacturer and supplier communications equipment. Its share price advanced 16.9% after reporting a record first-half result. Revenue increased 32% and net profit increased 21%.
Meanwhile, miners Liontown Resources (ASX:LTR) and Chalice Mining (ASX:CHN) were the worst performers on Tuesday.
The most traded stocks by Bell Direct clients on Tuesday included major banks National Australia Bank (ASX:NAB), Australia and New Zealand Banking Group (ASX:ANZ) and Westpac (ASX:WBC). Followed by CSL and Telstra (ASX:TLS).
European stocks closed higher as investors waited for the latest monetary policy announcement from the US Federal Reserve. However, US equities fell in a volatile session after the Federal Reserve Chairman Jerome Powell said there is “quite a bit of room” to raise interest rates before it would harm the economy. Traders took the comments to mean the central bank may be aggressive in tightening policy, and the benchmark 10-year Treasury yield climbed over 1.8%.
The Fed has now signalled that it could start raising interest rates in March. The central bank said in a statement that “with inflation well above 2% and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate.”
Following Wall Street, the SPI futures are suggesting the local market will fall 0.3% at the open.
What to watch today:
- The oil price extended gains, trading above US$87 a barrel on Wednesday, the highest since October 2014. Investors remain concerned about supply and the possibility of energy disruptions if Russia is to invade Ukraine.
- The price of gold has tumbled, trading below US$1,820 an ounce, amid a stronger dollar after Powell’s comments.
- The seaborne iron ore price is trading above US$129 a tonne.
- In economic data, on Tuesday Australia’s consumer price index for the December quarter surged 3.5% year-on-year, ahead of consensus and the RBA’s own forecasts. And today, import and export prices will be released at 10:30am AEDT.
Trading Ideas:
- Bell Potter maintain their BUY rating on Australia and New Zealand Banking Group (ASX:ANZ), and have increased their price target from $30 to $31. ANZ last closed at $26.77, implying 11.6% share price growth in a year.
- Trading Central have identified a bullish charting signal in COG Financial Services (ASX:COG), indicating that the price may rise from the close of $1.45 to the range of $1.73 to $1.79. The pattern formed over 147 days which is roughly the period of time in which the target price range may be achieved, according to standard principles of technical analysis.
Yesterday, the ASX200 closed 0.5% lower to 7,139 points, and it was the technology, utilities and mining stocks that were hit the hardest. On the flip side, the real estate sector managed to post a 1.45% gain.
The best performing stock was Uniti Group (ASX:UWL), up an impressive 9.3% after it was revealed that multiple approaches have been made towards the company, suggesting an interest in acquiring UWL. Goodman Group (ASX:GMG) was also on the rise, closing 3.5% higher following a broker note out from Macquarie. The broker expects that GMG could upgrade its FY2022 guidance in its half-year results, set to be released on the 17th of February. Macquarie has an Outperform rating and an increased price target to $26.63. Meanwhile Regis Resources (ASX:RRL) led the losses, falling 14.3% after cutting its full-year production guidance because of a geotechnical incident at its Rosemont mine and other operational challenges. Other stocks coming under pressure included Imugene (ASX:IMU), Life360 (ASX:360), and Liontown Resources (ASX:LTR).
In the US, it was a very choppy session, with the Dow plunging over 1,000 points during the session, however managed to make a remarkable comeback to close in the green, up 0.29%. The S&P500 lifted 0.28% and the Nasdaq up 0.63%. Investors began the session dumping tech shares, as they have all month, however those shares rebounded as the day went on with Meta, Amazon and Microsoft closing higher. And it’s expected on Wednesday that the Fed will signal its plans on when it will raise rates, after its two-day meeting.
Now, despite the comeback in the US, the futures are suggesting the Aussie share market will open 1.30% lower this morning.
What to watch today:
- Q4 production reports will be released by Beach Energy (ASX:BPT), Fortescue Metals (ASX:FMG), Iluka Resources (ASX:ILU), Mineral Resources (ASX:MIN) and St Barbara (ASX:SBM).
- The latest consumer inflation report is out this morning. A high reading could force the RBA to raise interest rates earlier. Also out today, is Business Confidence for December.
- The oil price fell 1.5% off the back of a stronger dollar and concerns over the possibility of quicker than expected increases to interest rates by the Fed.
- While the gold price gained 0.6% to US$1,843 per ounce as Ukraine tensions boost the safe-haven’s appeal.
- The spot iron ore price traded flat at US$133 a tonne.
- Paradigm Biopharmaceuticals (ASX:PAR) is holding its AGM today.
Trading Ideas:
- Bell Potter has maintained its BUY recommendation on Australia’s largest horticultural company, Costa Group (ASX:CGC) with a price target of $3.85. CGC closed 1.7% higher yesterday to $2.94, which implies 31% share price growth in a year.
- Trading Central has a bullish signal on Straker Translations (ASX:STG). This signal indicates that the stock price may rise from the close of $1.50 to the range of $1.78 - $1.86 in the next 24 days, according to standard principles of technical analysis.
Last Friday, we saw the Aussie share market fall 2.3%, its biggest, single-day decline in two weeks and largest weekly loss since October 2020. It was a very broad selloff, with all sectors closing in the red.
Boral (ASX:BLD) was up 2% despite no news out from the company. Some mining stocks also performed well, including Gold Road Resources (ASX:GOR) and Northern Star Resources (ASX:NST).
Meanwhile, Paladin Energy (ASX:PDN) fell a hefty 11% and Zip (ASX:Z1P) continued to come under pressure, falling 7.8%, now at a 52-week low of $3.33.
The most traded stocks by Bell Direct clients last Friday included BHP (ASX:BHP) which fell 4.8% last Friday, despite the company announcing the completion of the shareholder vote on its unification. BHP will now seek approval from the UK courts. And if everything goes to plan, the unification will be complete on the 31st of January, meaning its UK-listed shares will stop trading at the close of trade next Friday, the 28th of January.
In the US, all three benchmarks lost ground, the Nasdaq down the most, falling 2.7%. That it’s biggest weekly loss since October 2020. The Dow fell 450 points and the S&P500 slid 1.9%. This week, all eyes will be on Apple, Microsoft, and Tesla, who are set to post their earnings, as well as the Fed who will hold their two-day meeting in the middle of the week where conversations around rates will be important for the market to digest.
Following the negative session in the US, the futures are suggesting the Aussie share market will open 0.69% lower this morning.
What to watch today:
- Fortescue Metals (ASX:FMG), following its late announcement last Friday that revealed the company had signed an agreement with China’s state-owned Sinosteel.
- South32 (ASX:S32) and Pilbara Minerals (ASX:PLS) will release their Q4 production reports.
- Economic news wise, the manufacturing and services flash PMI will be released this morning.
- Oil prices fell for the second day in a row on Friday, following an unexpected rise in US crude and fuel inventories, while investors took profits after both benchmarks touched seven-year highs earlier in the week.
- The gold price fell slightly to US$1,834 per ounce.
- And the lithium price lifted 2.4% to a record high.
- Capital market company, Mirrabooka Investments (ASX:MIR) and Thorn Group (ASX:TGA) are going ex-dividend today.
Trading Ideas:
- Bell Potter has maintained its BUY recommendation on metallurgical coal producer, Coronado Global Resources (ASX:CRN) with a price target of $1.70. Bell Potter believe CRN is highly leveraged to the current strength in seaborne and US domestic met coal markets and is now generating significant free cash flow.
- Trading Central has a bullish signal on manganese producer Element 25 (ASX:E25). This signal indicates that the stock price may rise from the close of $1.47 to the range of $1.92 - $2.02 in the next 10 days, according to standard principles of technical analysis.
The Aussie share market declined 0.7% this week (Mon-Thu), weighed down by the tech sector. Meanwhile, the energy, materials and the consumer discretionary sectors were in the green.
In this week’s wrap, Sophia covers:
- (0:34) HUB24 (ASX:HUB) advancing after its positive Q2 update
- (1:29) BrainChip (ASX:BRN) continuing to shine, up 30%
- (1:50) The stocks Bell Direct clients were trading this week
- (2:12) What's happening in the lithium market, plus stocks to watch
- (4:54) Four important economic news items coming up
Yesterday the Aussie share market followed Wall Street’s lead, closing 1% lower, with the tech sector weighing down on the market the most. All four of the banks closed lower, with CBA posting the biggest loss, down 1.5%. Only the energy and utilities sectors managed to post small gains.
On the ASX200 stock leaderboard, the best performing stock was artificial intelligence company, Appen (ASX:APX), up 3.9%. Harvey Norman (ASX:HVN) also performed well, gaining 3.2% after Credit Suisse upgraded the stock from neutral to outperform with a 3% increase in its price target to $5.62. Meanwhile, Megaport (ASX:MP1) came under pressure yesterday, amid broad weakness in the tech sector, but also as investors were underwhelmed by its second quarter results update. The company reported a quarter-on-quarter increase of just 7% in its monthly recurring revenue (MRR) to $9.2 million. Some of the other worst performers included NOVONIX (ASX:NVX) and Allkem (ASX:AKE).
The most traded stocks by Bell Direct clients yesterday, once again software company, BrainChip (ASX:BRN) has made the list. The company is up a massive 213% so far this year, and pushed higher yesterday, following the announcement of another granted patent. The company now holds a significant market cap of over $3.5 billion. Other top traded stocks included Lake Resources (ASX:LKE), Fortescue Metals (ASX:FMG), CSL (ASX:CSL) and James Hardie (ASX:JHX).
In the US, all three benchmarks pulled back, despite several strong earnings reports, from companies such as Bank of America, Morgan Stanley, and Procter & Gamble. It comes as investors remain cautious amid elevated government bond yields. The 10-year Treasury yield topped 1.9% during the session, its highest level since December 2019. This session ended with the Dow falling over 300 points, the S&P500 down 1% and the tech-heavy Nasdaq closing 1.2% lower.
For today, despite the negative session in the US, the futures are suggesting the Aussie share market will open 0.14% higher.
What to watch today:
- Block (ASX:SQ2) joins the ASX today, trading on a deferred settlement basis, replacing Afterpay, which has now officially been removed from the Aussie share market. In the US, Block’s share price closed 1.43% lower on Wednesday.
- In economic news, yesterday consumer confidence for January fell 2% to 102.2, which was surprisingly solid, given the rapid spread of the Omicron variant. And today, the unemployment rate for December will be released. As a reminder, the unemployment rate came in at 4.6% in November. Consensus expects December’s reading to fall to 4.5%.
- In commodities, oil prices lifted for the fourth day to a 7-year high, as an outage on a pipeline from Iraq to Turkey added to the tight supply outlook. The WTI crude oil price is currently up 1.18% to US$86.58 a barrel. The gold price lifted 1.5% to US$1,840 per ounce. The seaborne iron ore price is trading slightly lower at US$127 a tonne. And the silver, copper and platinum prices are all trading between 1.5% to 4.5% higher.
- Both BHP Group (ASX:BHP) and Centuria Industrial REIT (ASX:CIP) are holding their AGM today.
Trading Ideas:
- Citi has maintained its BUY recommendation on global lithium chemicals company, Allkem (ASX:AKE), with an increased price target of $13.40 (previously $12). Separately, Bell Potter has a HOLD rating on AKE with a price target of $11, while Credit Suisse has an Outperform rating and a price target of $13.70.
- Trading Central has a bullish signal on Orica (ASX:ORI). This signal indicates that the stock price may rise from the close of $13.92 to the range of $17.50 - $18.40 in the next 80 days, according to standard principles of technical analysis.
The local market closed 0.1% lower yesterday. While materials lead the market, the healthcare sector declined the most.
Biotech company Imugene (ASX:IMU) rallied 7%, closely followed by JB Hi-Fi (ASX:JBH), who reported a better-than-expected first-half trading update. Total sales managed to rise, while net profit fell 9.5%. JBH closed yesterday at $49.84 and Bell Potter maintain their HOLD rating on the stock, while Morgans upgraded from a HOLD to an ADD.
Pointsbet (ASX:PBH), Virgin Money (ASX:VUK) and Zip (ASX:Z1P) were among the worst performers yesterday.
Some of the most traded stocks by Bell Direct client yesterday included Lake Resources (ASX:LKE), APA Group (ASX:APA) and BrainChip (ASX:BRN).
European stocks closed lower as investors reacted to developments in the oil and bond markets. Oil and gas shares gained the most, off the back of a surge in oil prices amid rising tensions in the Middle East. And global markets have been watching the Fed, as they’re expected to hike interest rates and tighten monetary policy. And as US bond yields rose on Tuesday, the tech sector suffered. The Nasdaq down 2.3%, its lowest level in 3-months and down 10% from its most recent high. The Dow was down 1.4% and the S&P500 down 1.7%. The US market was weighed down by Goldman Sachs shares, which dropped 7% after the bank reported fourth-quarter earnings which missed analyst expectations. Meanwhile, the 10-year yield rose to a 2-year high.
Following New York, the SPI futures are suggesting the local market will fall 1.04% at the open.
What to watch today:
- Oil is trading higher at US$86 a barrel, boosted by tight supply and geopolitical tensions in the Middle East.
- Gold is trading slightly lower at US$1,813, easing from recent highs after the 10-year Treasury yield rose to pre-pandemic highs this week.
- The seaborne iron ore price is trading 1.2% higher at US$127 a tonne.
- Economic data to look out for today is the consumer confidence index for January, which will be released at 9:30am this morning. It’s expected to decline amid concerns of the rapidly spreading Omicron variant.
- BHP (ASX:BHP), Lynas Rare Earths (ASX:LYC) and Woodside Petroleum (ASX:WPL) are set to release their fourth quarter production reports today.
- Alternative Investment Trust (ASX:AIQ), Kelly Partners Group (ASX:KPG), and Plato Income Maximiser (ASX:PL8) and set to go ex-dividend today.
Trading Ideas:
- Bell Potter maintain their BUY rating on Life360 (ASX:360) and have decreased their price target from $16.25 to $15. Next Thursday Life360 will report and Bell Potter expect the company to have achieved all key 2021 guidance metric.
- Trading Central have identified a bullish signal in NOVONIX (ASX:NVX). This bullish signal indicates that the stock price may rise from the close of $10.21 to the range of $14.50 - $15.50. The pattern formed over 34 days which is roughly the period of time in which the target price range may be achieved, according to standard principles of technical analysis.
Yesterday, the Aussie share market pushed 0.3% higher, supported by both the consumer discretionary and energy sectors. All eyes were on China, as we found out that China's economy grew 4% in the fourth quarter from a year earlier, faster than expected but its weakest expansion in one and a half years.
The consumer discretionary sector advanced the most, led by Wesfarmer’s gain following its trading update before the market opened. The group's performance for the half was supported by pleasing results in Bunnings and Wesfarmers Chemicals, Energy & Fertilisers, while results in Kmart Group and Officeworks were impacted by COVID-related disruptions and costs. The worst performing sector was the materials sector, and we saw mining giants BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO) come under pressure, down 1.14% and 0.52% respectively.
Looking at the ASX200 stock leaderboard, two of Australia’s best-known fund managers were among the day’s top performers, Pendal Group (ASX:PDL) and Magellan Financial Group (ASX:MFG). Pendal Group led the way, up 7.8% following a statement that its chairman, James Evans would step down. Remember however, that last Friday Pendal fell 15.8% after a dip in funds under management. The second-best performer was Adbri (ASX:ABC), up 7.2% after announcing an extension of its lime supply contract with Alcoa. Meanwhile, Perseus Mining (ASX:PRU), Paladin Energy (ASX:PDN) and Liontown Resources (ASX:LTR) were down the most.
The most traded stocks by Bell Direct clients yesterday included Liontown Resources (ASX:LTR), Telstra (ASX:TLS) and BrainChip (ASX:BRN). Beach Energy (ASX:BPT) lifted 3.9%, trading at levels not seen since October last year, supported by the oil price surging higher recently.
The US market was closed on Monday for the Martin Luther King Junior holiday. In Europe, stocks closed higher on Monday as investors digested a string of corporate news and the latest growth data out of China. Credit Suisse was involved in a scandal whereby its chairman resigned after breaking COVID quarantine rules. Overall, we saw the German DAX close 0.32% higher, the FTSE up 0.91% and the STOXX600 rise 0.7%.
For today, in line with the positive session across the sea in Europe, the futures are suggesting the Aussie share market will open 0.30% higher.
What to watch today:
- Rio Tinto (ASX:RIO) has just released its fourth quarter update. Its Chief Executive said despite the operating conditions remaining challenging in 2021, due to COVID-19 disruptions, the business continued to experience strong demand for its products and continued to progress several of its projects. Now Goldman Sachs expected iron ore shipments of 88.9Mt and 133kt of mined copper for the quarter. Rio has announced results that fall short of these expectations. Iron ore shipments of 84.1Mt and 132kt of mined copper. So keep watch of the stock, as it may come under pressure after falling short of these expectations.
- Other companies releasing their fourth quarter results today include: Galaxy Resources (ASX:GXY) and Orocobre’s merger, Allkem (ASX:AKE), and petroleum company, Ampol (ASX:ALD).
- Oil prices edged higher as investors bet that supply will remain tight despite restrained output by major producers. The WTI crude oil price is currently up 0.54% to US$84.27 a barrel, that’s a 7-year high. The gold price held steady at US$1,818 per ounce. And the seaborne iron ore price is trading 1.25% lower, at US$126 a tonne.
Trading Ideas:
- Firstly, Bell Potter have maintained their BUY recommendation on City Chic Collective (ASX:CCX). The retail clothing company recently released its preliminary unaudited first half 2022 results and two of the key highlights included: (1) strong first half 2022 results that were ahead of Bell Potter’s expectations, driven by strong growth in the US and robust sales in
On Friday, the ASX200 ended its worst week since November, amid a sell-off among tech stocks. The tech sector declined 4%, with Afterpay (ASX:APT) at its lowest price since July. WiseTech Global (ASX:WTC), Nuix (ASX:NXL) and Nearmap (ASX:NEA) were all lower, and Xero (ASX:XRO) was down the most, falling 9%. Consumer staples also look a hit, and the local market closed just over 1% lower.
Medical device company ResMed (ASX:RMD) performed best, advancing 3.6%, followed by Ramelius Resources (ASX:RMS) and AGL Energy (ASX:AGL). AGL was the best performer of the week, helping to offset some market losses. The stock gained 19% over the week, after Credit Suisse named AGL their top pick among energy sector equities, due to the advantage AGL has in low-cost coal supply.
Investment manager Pendal (ASX:PDL) declined 15%, following the release of its funds under management update for the first quarter, which fell 2.5% to $135.7 billion, disappointing investors.
Some of the most traded stocks by Bell Direct clients on Friday, were the major miners, including Fortescue Metals (ASX:FMG), Pilbara Minerals (ASX:PLS), BHP (ASX:BHP), Nickel Mines (ASX:NIC), Lake Resources (ASX:LKE) and Syrah Resources (ASX:SYR).
European stocks were lower, as expectations for imminent policy tightening by the Fed resurfaced. US markets had another negative week. Major banking stocks were broadly lower after reporting their earnings. In recent weeks, bank stocks had outperformed as interest rates moved higher, however investors were underwhelmed by Friday’s reports. The Dow Jones was down 0.6%, while the S&P500 closed slightly higher 0.08%. Meanwhile, tech stocks helped offset concerns. The tech-heavy Nasdaq outperformed with a 0.6% gain.
Following US equities, the SPI futures are suggesting the ASX200 will rise 0.38% at the open.
What to watch today:
- The local tech sector, as ASX tech stocks often follow the Nasdaq’s lead. New York listed Xero (ASX:XRO) and Appen (ASX:APX) rebounded in the US on Friday. So their price movements will be on watch, however as the price of Block (formally known as Square) continues to fall in the US, it’s unlikely Afterpay will see any strong gains.
- Despite speculation that China will release some of its reserves, the oil price charged higher. The oil price rose more than 2% to US$83.82 a barrel. Supply disruptions in Libya and Kazakhstan and the diminishing US crude inventories, have offset mobility in China.
- Gold is trading lower, at US$1,817 an ounce, weighed down by higher US Treasury yields and a rebound in the dollar.
- The seaborne iron ore price is also trading lower at US$126.24 a tonne.
Trading ideas:
- Credit Suisse has upgraded their rating on AGL Energy (ASX:AGL) from Neutral to Outperform, and have increased their price target from $7.30 to $8.30. EPS and DPS forecasts have been noticeably increased, and AGL last closed at $7.47.
- Trading Central have identified a bullish signal in De Grey Mining (ASX:DEG), which indicates that the stock price may rise from the close of $1.28 to the range of $1.58 to $1.66. The pattern formed over 111 days which is roughly the period of time in which the target price range may be achieved, according to standard principles of technical analysis.
The Aussie share market gained 0.3% this week (Mon-Thu). The energy sector advanced the most, while the consumer staples sector took the biggest hit.
In this week’s wrap, Sophia covers:
- (0:23) AGL Energy (ASX:AGL) lifting 15% following a broker update
- (0:45) PolyNovo (ASX:PNV) gaining after record US sales reports
- (1:14) Why investors bought into BrainChip (ASX:BRN)
- (1:34) What stocks Bell Direct clients were trading this week
- (1:56) Bell Potter's top stock picks for 2022
- (4:47) Two economic news items to watch out for
Yesterday the ASX200 lifted 48 points or 0.66% higher, the market’s first gain of the week, boosted by both the energy and tech sectors, which gained 3% and 2% respectively. Also supporting the market was solid gains for commodity prices, as well as Jerome Powell’s testimony that confirmed the Fed would lift rates if needed to check prices.
Nickel Mines (ASX:NIC) led the way, up an impressive 6.5%. This follows the nickel price touching a seven-year high amid the global push towards a greener future, like the push towards electric vehicles. Nickel is a key component in lithium-ion batteries, which are used to generate power for electric vehicles. Another top performer was Afterpay (ASX:APT). The stock gained 4.8% yesterday after the company cleared its final hurdle to be taken over by Block (formerly Square). APT will now officially stop trading on the ASX next Wednesday, the 19th of January, and will commence trading on the NYSE on the 2nd of February. Meanwhile, Domino’s Pizza (ASX:DMP) came under pressure, falling 4.5%. This appears to be driven by an update from its US parent. The pizza giant warned that it’s expecting “unprecedented” food cost increases in 2022, approximately an 8% to 10% rise in its food basket costs, and that’s worrying, as that’s 3-4 times the food inflation experienced in a typical year.
The most traded stock by Bell Direct clients yesterday, were Allkem (ASX:AKE), a lithium carbonate supplier, formed after the merger between Orocobre and Galaxy Resources. Its shares have gained over 25% the past month, underpinned by the hot-running lithium markets. Lithium carbonate prices have increased six-fold since January 2021.
In the US, all three benchmarks rose, with the Nasdaq gaining for the third straight day. This comes as the consumer price index increased 0.5% last month, which was slightly better than expected. And therefore in the 12-months through to December, the CPI has surged 7%, its biggest jump since 1982.
Despite the positive session on Wall Street, the futures as at 8:30am AEDT are suggesting the Aussie share market will open 0.04% lower.
What to watch today:
- Keep an eye on Crown Resorts (ASX:CWN). Goldman Sachs gave the stock a neutral rating and an $11.03 price target, telling investors to instead buy the shares of its rival Star Entertainment Group (ASX:SGR).
- Oil prices pushed to two-month highs on tight supply and easing concerns about the potential hit to demand from the Omicron variant.
- The gold price gained, as the dollar retreated following US inflation being in line with expectations. Spot gold was up 0.2% to $1,825 per ounce.
- The silver, copper, steel, iron ore and lithium prices are all booming, all up between 1.5%-3%.
Trading Ideas:
- Citi have maintained their BUY recommendation on shipbuilding and repairing company, Austal (ASX:ASB) with a price target of $3.09. Citi believes the stock remains catalyst rich and are supportive of the new strategies aimed at diversifying pipeline risk. These include adding steel capability and increasing number of programs it contests) and growing support revenue. Austal closed 5% higher yesterday to $1.97, which implies about 57% share price growth in a year.
- Trading Central has a bullish signal on software company, Whispir (ASX:WSP). This signal indicates that the stock price may rise from the close of $2.60 to the range of $2.64 - $2.72 in the next 30 days, according to standard principles of technical analysis.
Yesterday Australian shares fell for the second straight trading session. The benchmark index was dragged down mostly by the major banks, real estate, and consumer staples, and the ASX200 closed 0.76% lower. Meanwhile, materials managed to close slightly higher.
PolyNovo’s (ASX:PNV) share price gained rose an impressive 25.2% yesterday to $1.79. They reported unaudited record US sales in December of $3.4 billion, which is a 76% increase on the same time the year prior.
The worst performer yesterday was ARB Corporation (ASX:ARB), down more than 12%, after reaching a 52-week high last week. This was after Credit Suisse downgraded its share price guidance on ARB from “neutral” to “underperform” with a $38 price target. Meanwhile, JP Morgan upgraded ARB to “underweight” yesterday, with a $35 price target. ARB closed yesterday at $46.32.
The most traded stocks by Bell Direct clients yesterday included Coles (ASX:COL), Fortescue Metals (ASX:FMG), Afterpay (ASX:APT).
In the US, all three major benchmarks closed higher. The S&P500 up 0.9%, the Dow up 0.5% and the Nasdaq rallied for a second day, gaining 1.4%. Rising interest rates have put pressure on equities, however, interest rates cooled yesterday, with the 10-year Treasury yield falling below 1.75%.
Investors will be trading cautiously ahead of inflation updates in the US today and tomorrow, awaiting an indication of US interest rate hikes.
Following the positive session in New York, the SPI futures are suggesting the ASX200 will open 0.86% higher this morning.
What to watch today:
- Oil is trading over 3% higher at US$81 a barrel, boosted by short supply and a weaker dollar, as well as expectations that the impacts of Omicron on the economy will be short-term.
- Gold is also trading higher, above US$1,800 an ounce, as investors await the US inflation reading.
- The seaborne iron ore price is trading 1.4% lower US$124 a tonne.
- In economic news, retail sales data was released yesterday, which increased by 7.3% in November, from 4.9% the month prior. This exceeded market consensus of 3.9% and was the largest lift in 18 months. Balance of Trade data was also released. Australia’s trade surplus fell from $10.78 billion to $9.43 billion in November 2021. It was the smallest trade surplus since April, with the softening of global demand due to the COVID-19 pandemic.
Trading Ideas:
- Bell Potter maintain their BUY rating on BCI Minerals (ASX:BCI), and have lowered their price target from $0.71 to $0.66. The iron ore miner has completed a capital raising of up to $360 million, that represents the last piece of its $1.2 billion funding package for its Mardie Salt & Potash project. BCI closed yesterday at $0.42, implying 52% share price growth in a year.
- Trading Central has identified a bullish signal in Centaurus Metals (ASX:CTM) which indicates that the stock price may rise from the close of $1.27 to the range of $1.32 - $1.36, within 65 days.
The Aussie share market started yesterday down 0.6%, however managed to close just 0.08% lower yesterday to 7,447. Only three sectors managed to post gains, while the tech and consumer discretionary sectors were hit the hardest. The tech sector is suffering from a spike in bond yields as markets anticipate a faster tightening cycle by central banks.
Looking at the ASX200 stock performance, the top stock yesterday was battery materials and technology company, Novonix (ASX:NVX). The stock was up 10.8% after announcing its intentions to list on a second stock exchange, the Nasdaq in the US. AGL Energy (ASX:AGL) also performed well, rising 8.6%, following a bullish broker note from Credit Suisse, upgrading the stock to “outperform”. And some of the other best performing stocks included mining stocks Alumina (ASX:ALU), Champion Iron (ASX:CIA), Chalice Mining (ASX:CHN) and Iluka Resources (ASX:ILU). Reliance Worldwide (ASX:RWC) was the worst performer, down 3.4%, despite no news out from the company, and both Xero (ASX:XRO) and WiseTech Global (ASX:WTC) saw some selling as the tech sector came under pressure.
The most traded stocks by Bell Direct clients yesterday was Wesfarmers (ASX:WES). The company is now the last one standing in the takeover of Priceline owner Australian Pharmaceuticals Industries (ASX:API), after Woolworths withdrew its proposal. Afterpay (ASX:APT), Telstra (ASX:TLS) and Fortescue Metals (ASX:FMG) were also highly traded yesterday.
In the US, stocks recovered from earlier losses, staging an afternoon rally that put an end to the Nasdaq’s four day losing streak. The tech-heavy Nasdaq closed 0.05% higher, while the Dow and S&P500 both fell, down 0.45% and 0.14% respectively. European stocks closed lower amid interest rate fears, ahead of key US inflation data out this week and more comments from US Federal Reserve Chairman Jerome Powell on interest rate hikes.
For today, following the mixed session on Wall Street, the futures are suggesting the Aussie share market will open 0.56% lower.
What to watch today:
- Keep an eye on Ramsay Health Care (ASX:RHC). The company reached agreement regarding a new volume-based agreement with the NHSE, the National Health Service in England, which makes its services available to the NHSE and its patients to meet the ongoing demands resulting from the COVID-19 pandemic. If the agreement is well received by investors, its shares could lift.
- Economic news out today includes Australia’s balance of trade data for November. Australia's trade surplus decreased to A$11.22 billion in October from a downwardly revised A$11.82 billion in the previous month. Consensus expects trade surplus to decrease again to A$10.6 billion in November. Separately, retail sales for November will also be released today.
- Oil prices fell on demand concerns given the rapid global rise in omicron infections, while the gold price edged higher despite US 10-year Treasury yields hitting two-year highs. And the seaborne iron ore price traded slightly higher to US$126 a tonne.
Trading Ideas:
- Bell Potter have upgraded their rating on coal mining company, Whitehaven Coal (ASX:WHC) from a HOLD to a BUY, and have also increased their price target from $3.50 to $3.60. Bell Potter believe the coal price strength from mid-2021 should now be flowing through to realised prices, which should materially lift free cash flow. Operational risks at Narrabri remain, however, should abate over 2022. Therefore, Bell Potter believe WHC is cheap on most valuation metrics, and that supports their upgrade to a BUY. Now, WHC closed 5% higher yesterday to $2.89, which implies about 25% share price growth in a year.
- Trading Central has a bullish signal on EML Payments (ASX:EML). This signal indicates that the stock price may rise from the close of $3.22 to the range of $4.30 - $4.50 in
Last week the market had a jumpy start to the year. Mid-week, the market hit a 4-month high, then on Thursday the market had its worst session in 16 months. On Friday however, the ASX200 ended the week on a positive note, advancing 1.3%, with all sectors in the green. Energy, financials and utilities were up the most.
Medibank, one of the country’s largest private health insurance providers, (ASX:MPL), lead the gains, up almost 6%. This was off the back of some restrictions reintroduced in NSW, which includes the suspension of elective surgery until February, in the aim of helping the healthcare system cope with the current spike in covid cases in NSW. Medibank was followed by Unibail-Rodamco-Westfield (ASX:URW), which gained 5.8% on Friday and over 10% in the week, following its European shares which have performed well. Sims (ASX:SGM), NOVONIX (ASX:NVX) and Magellan Financial Group (ASX:MFG) were among the worst performers.
The most traded stocks by Bell Direct clients on Friday included Nickel Mines (ASX:NIC), lithium producer Lake Resources (ASX:LKE) and Telstra (ASX:TLS)
In US equities, all three major benchmarks were lower. The S&P500 fell 0.4%, the Dow lost 0.01% and the tech-heavy Nasdaq had its worst week since February, down 0.9%. The latest economic update in the US saw a disappointing jobs report, adding fewer jobs than expected in December. And the US unemployment rate dropped to 3.9%, better than the 4.1% estimate.
The local market is set to open flat, with the SPI futures suggesting a rise of 0.03%.
What to watch today:
- Keep watch of the prices of Woolworths (ASX:WOW) and Australian Pharmaceutical Industries (ASX:API). Woolworths (WOW) has withdrawn from its non-binding proposal to Australian Pharmaceuticals (API) after a month-long due diligence period. At the start of December, Woolworths announced it would offer API the cash price of $1.75 per share. WOW have stated that the reason for the withdrawal as unable to “validate the financial returns it requires in line with the Group’s capital allocation framework”. API fell 12.4 per cent to $1.52 a share.
- Oil is trading 0.7% lower at US$78.90 a barrel. Gold is 0.4% higher, trading just under $1,800 per ounce. And the seaborne iron ore price is trading higher at US$126 a tonne.
Trading Ideas:
- Bell Potter maintain their BUY rating on Coronado Global Resources (ASX:CRN) and have increased their price target from $1.55 to $1.70. CRN is highly leveraged to the current strength in seaborne and US domestic met coal markets and Bell Potter expect CRN to resume shareholder returns in 2022. CRN last closed at $1.30, implying 30.3% share price growth in a year.
- Trading central have identified a bullish signal in Energy Resources (ASX:ERA). This bullish signal indicates that the stock price may rise from the close of 0.37 to the range of 0.42 - 0.44, within 27 days.
Yesterday, the market closed 0.4% lower. Shares rose higher after the US Fed announced it would wind down its asset purchases, known as tapering, at a faster pace amid a continued rise in inflation, and signalled an interest rate rise next year.
Information technology gained the most, while healthcare fell 5%. The local market was dragged into the red by heavy losses from CSL, which lost over 8% yesterday. Champion Iron (ASX:CIA) was another of the worst performers. On Wednesday, Macquarie maintained their Outperform rating on CIA, with a $7.40 price target. The broker is generally positive on stocks with iron ore exposure.
Mesoblast (ASX:MSB) jumped 11%, off the back of a clinical trial update, where they’re working on regenerative medicines for inflammatory conditions. WiseTech (ASX:WTC) jumped over 6% to $59.10 a share, after hitting a new all-time high at $59.25 in intraday trading.
The most traded stocks by Bell Direct clients yesterday, were CSL (ASX:CSL) and Fortescue Metals (ASX:FMG), which yesterday revealed its looking to repurpose its New Zealand oil refinery. Morgan Stanley retain their Underweight rating on FMG with a $14.05 target price. And Macquarie retain their Outperform rating and a $21 target. FMG is also a Bell Potter BUY at $19.75 target.
And Woolworths (ASX:WOW) has come under some selling pressure this week, after a trading update: its bottom line took an $150 million hit. Analysts were expecting its pace of growth in grocery sales to ease off once restrictions were lifted but were caught out by the extent of COVID-19 ramifications. Woolworths staff were required to be tested every three days for Delta, then had to wait a few days for results. This interrupted the efficiency and productivity of the supermarket’s labour-intensive operations. The pandemic also caused supply shortages and delays, which led to a sharp increase in wholesale grocery prices. Most brokers have updated their recommendations on Woolworths and lowered their price targets this week. UBS retain their SELL rating, while Macquarie and Citi are Neutral.
European stocks closed higher as investors took in central bank decisions. The Bank of England yesterday hiked interest rates for the first time since the beginning of the pandemic. Meanwhile the European Central Bank further cut its bond purchases, promising to continue its monetary policy support for the euro zone into next year. And the US Fed announced several rate hikes. In New York, equities were lower, as some of the large tech names struggled, which saw the Nasdaq drop 2.5%. The Dow also down 0.08% and the S&P500 down 0.9%.
Looking to the local session ahead, despite the sell-off in tech in New York, the local market is set to open higher. The SPI futures are suggesting a 0.14% rise at the open, which is supported by a broad rally in commodities.
What to watch today:
- Oil is trading 1.5% higher, above US$71 a barrel. The gold price rose for the second straight day, trading at US$1,798 an ounce, as the dollar weakened and inflation threats become more evident after central bank meetings. The seaborne iron ore price is higher at US$111 a tonne.
- The unemployment rate was released yesterday, which fell to 4.6% in November, from 5.2% a month earlier. Unemployment fell by 69,000 people. Employment increased by 366,000 people. The large increase in employment saw the participation rate increase to 66.1% in November. That is slightly under the peak in May, and higher than the start of the pandemic.
- Incitec (ASX:IPL), National Australia Bank (ASX:NAB) and Nufarm (ASX:NUF) are set to hold their AGMs today.
Trading ideas:
- Bell Potter have a Speculative BUY rating on S2 Resources (ASX:S2R), and have increased their valuation by 33% to $0.24, to reflect the addition of the Greater Fosterville project in Victoria to the company’s port
The Aussie share market closed 0.7% lower yesterday, its biggest fall in nearly two weeks, with nearly all sectors closing in the red. Tech shares led the losses, down 2.6%. It was only the utilities sector that was able to post a modest gain of 0.3%.
On the ASX200 stock performance, just 40 of the top 200 blue chips by market value posted a positive gain for the day. The best performers included Virgin Money UK (ASX:VUK) and Alumina (ASX:ALU). Some other top stocks included Whitehaven Coal (ASX:WHC), as well as AGL Energy (ASX:AGL). Meanwhile, PointsBet Holdings (ASX:PBH) was the worst performer, falling 7.6%. Tech stocks like Life360 (ASX:360) and Megaport (ASX:MP1) tumbled, both down between 5-6%. And Buy Now Pay Later giants, Afterpay (ASX:APT) and Zip (ASX:Z1P) also saw some selling.
The most traded stocks by Bell Direct clients yesterday included Woolworths (ASX:WOW), Northern Star Resources (ASX:NST) and Westpac (ASX:WBC).
In the US, stocks recovered from their early losses after the Fed announced that it would wind down its asset purchases, at a faster pace amid a continued rise in inflation. This will put it on track to conclude the program in early 2022, rather than mid-year as initially planned. The Fed also signalled three rate hikes for 2022, due to the faster pullback, despite the ongoing challenge the pandemic poses to the economic recovery. So, all three benchmarks pushed higher. The Dow jumped just over 380 points, the S&P500 lifted 1.6% and the Nasdaq was up 2%.
For today, following the positive session on Wall Street, the futures as at 8:40am AEDT are suggesting the Aussie share market will open 0.6% higher.
What to watch today:
- CSL (ASX:CSL) is due to return to trade today after completing its institutional placement. CSL had been in a trading halt since close of trade Monday.
- Qantas (ASX:QAN) will be holding an investor update this morning.
- In economic news, yesterday consumer confidence for December fell 1% to 104.5, however remains in positive territory, as an index score above 100 indicates that optimists outweigh pessimists. And today, the unemployment rate for November will be released. As a reminder, the unemployment rate came in at 5.2% in October. Consensus expects November’s reading to fall to 5%.
- In commodities, oil prices turned positive, reversing early losses despite rising supply. While the gold price sunk following the Fed’s statement. A UBS strategist noted that the gold price should bottom out over the next 12-24 months, with prices likely to recover and stabilise after the Fed’s hiking cycle starts in earnest. And the seaborne iron ore price traded 2% higher to US$109.22 a tonne.
- ANZ (ASX:ANZ), Elders (ASX:ELD) and Orica (ASX:ORI) are holding their AGMs today.
- Boutique fund manager, Plato Income Maximiser (ASX:PL8) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained their BUY recommendation on software and services company, Envirosuite (ASX:EVS) with a slight increase in its price target to $0.275. Bell Potter did not anticipate the company’s recent capital raising but view it positively as they believe the key driver was that EVS sees a large opportunity in the global water and wastewater market. They therefore expect to see a higher level of contract wins in FY23 and FY24. EVS closed 5% higher yesterday to $0.21, which implies about 31% share price growth in a year.
- Trading Central has a bullish signal on Global Lithium Resources (ASX:GL1). This signal indicates that the stock price may rise from the close of $0.64 to the range of $0.85 - $0.91 in the next 31 days, according to standard principles of technical analysis.
Australian shares closed flat yesterday. The real estate sector led the gains, while consumer staples declined 4%.
Medical device company, Polynovo (ASX:PNV), jumped 15%, from $1.36 to $1.57 yesterday, after a positive business update, advising that its US segment had experienced a strong start to the second quarter. Charter Hall (ASX:CHC) gained over 5%, extending its gains from the previous session. Meanwhile, Mesoblast (ASX:MSB) fell 17%, off the back of news that biotech company Novartis choose to terminate an agreement with the business. Woolworths Group (ASX:WOW) also fell after the supermarket warned that its profit growth is slowing. And Afterpay (ASX:APT) fell 4.1% to $90.83, even after its shareholders approved its acquisition by Block, formerly Square. And this deal is now awaiting approval from the Spanish Central Bank.
The best performer in the All Ords was Virtus Health (ASX:VRT) which jumped an impressive 35%. VRT is a fertility, diagnostic and day hospital, and they announced that they received a takeover bid from private equity group BGH Capital. Pointterra (ASX:3DP), gained 17.4% after announcing three new US contracts.
In New York, US investors traded cautiously amid the final US Federal Reserve policy meeting of the year. Large tech stocks also moved lower and new inflation data continued to show a sharp rise in prices. The Fed began its two-day meeting on Tuesday and today the Central Bank will release a statement with quarterly projections for the economy, inflation, and interest rates. The Dow Jones is down 0.3%, the S&P500 is down 0.75% and the Nasdaq is down 1.14%.
The Aussie share market is set to open lower this morning, with the SPI futures suggesting a 0.4% fall.
What to watch today:
- Consumer confidence figures will be released this morning for December.
- Oil is trading 1.5% lower, around US$70 a barrel, after the International Energy Agency declared the Omicron COVID-19 variant could dent the global demand recovery.
- The gold price dropped to around US$1,770 an ounce, the lowest level since the 2nd December, as investors await major central bank policy meetings, while the dollar strengthened and bond yields traded higher.
- The seaborne iron ore price is lower, at US$107 a tonne.
- Westpac (ASX:WBC) is set to hold its AGM today.
- Grange Resources (ASX:GRR) is set to go ex-dividend today.
Trading ideas:
- Bell Potter maintain their BUY rating on Nufarm (ASX:NUF), at a $5.40 price target. NUF last closed at $4.71, implying 14.6% share price growth in a year. NUF is also a UBS, Morgans and Citi BUY.
- Trading Central have identified a bullish signal in Panoramic Resources (ASX:PAN), which indicates that the stock price may rise from the close of $0.25 to the range of $0.28 to $0.29, within 35 days.
The Aussie share market pushed 0.4% higher yesterday, to start the new trading week off on a positive note. Most sectors posted gains, with the energy, real estate and materials sectors leading the way, while the financial and healthcare sectors came under a bit of pressure.
Netwealth (ASX:NWL) was the biggest gainer, while Charter Hall Group (ASX:CHC) rose 5.6% to a new all-time high, following the company announcing an upgraded FY22 earnings guidance and funds under management growth update. Other top stocks included material stocks St Barbara (ASX:SBM), Champion Iron (ASX:CIA), Iluka Resources (ASX:ILU), Regis Resources (ASX:RRL) and Pilbara Minerals (ASX:PLS). Meanwhile, the worst performing stocks yesterday included NIB Holdings (ASX:NIB), GUD Holdings (ASX:GUD) and Insurance Australia Group (ASX:IAG). IAG closed 3.4% lower after UBS dropped its price target to $4.20 and rated the stock a SELL.
The most traded stocks by Bell Direct clients yesterday included Liontown Resources (ASX:LTR), BHP Group (ASX:BHP), and Brickworks (ASX:BKW). Another most traded stock was gold miner and lithium developer Firefinch (ASX:FFX). The company successfully completed a $100m Institutional Placement, whereby proceeds from the placement will be used to fast track the production growth at the Morila Gold Mine.
In the US, stocks retreated as investors remained cautious about how the Omicron variant will impact the economy, as well as what the Federal Reserve will announce on Wednesday. All three benchmarks closed lower, with the Nasdaq down the most. The S&P500 fell 0.91%, and the Dow lost 320 points.
For today, following the negative session on Wall Street, the futures are suggesting the Aussie share market will open 0.6% lower.
What to watch today:
- Afterpay (ASX:APT) is one to watch as today its shareholders will vote on the Square takeover. Now Square recently changed its name to Block, to house the company’s various products. And since the offer was made back in August, Block’s share price has sunk more than 30%, meaning the value of the transaction is now less than where Afterpay’s shares were trading prior to the offer being made.
- In economic news, business confidence data for November will be released this morning. Business confidence is determined via a monthly telephone survey conducted by NAB, where 600 small, medium, and large sized non-agricultural companies are surveyed on their expectations of business conditions for the upcoming month. In October, business confidence surged to 21 points from 10 in September, and November’s reading is expected to come in at 23 points.
- Oil prices fell due to new doubts about the Omicron variant. However, OPEC predicted in its monthly report that the variant’s impact on fuel demand will be mild. The gold price lifted as the focus turns to the upcoming Fed meeting, which will give investors an indication of when stimulus measures would wind down. And the seaborne iron ore price lifted 3.3% to US$108.51 a tonne.
- HUB24 (ASX:HUB) is holding its AGMs today.
- Engineering services company, Cardno (ASX:CDD) is set to go ex-dividend today.
Trading Ideas:
- Citi upgraded its rating on investment advice business, Perpetual (ASX:PPT) from NEUTRAL to BUY, with a price target of $40.40. PPT closed 1.25% lower yesterday to $35.68, which implies about 14% share price growth.
- Trading Central has a bullish signal on lithium developer, Lake Resources (ASX:LKE). This signal indicates that the stock price may rise from the close of $0.89 to the range of $0.97 - $0.99 in the next 20 days, according to standard principles of technical analysis.
The market lost some ground last Friday, after what had been a positive week and closed 0.4% lower, with utilities up the most.
Online marketplace Redbubble (ASX:RBL) was the best performer on the ASX200, gaining over 10%. UBS initiated coverage of the stock, with a NEUTRAL rating and a $3.45 price target. Iluka Resources (ASX:ILU) gained over 7%, amid a broader rally in the electric vehicle focused commodity sector. Meanwhile, Afterpay (ASX:APT) declined the most.
Bell Direct clients found the most value in Battery Tech & Lithium ETF (ASX:ACDC), as well as CSL (ASX:CSL), Westpac (ASX:WBC), Pilbara Minerals (ASX:PLS) and AGL Energy (ASX:AGL).
On Friday US CPI data was released. Inflation rose 6.8% year-over-year, its highest rate since 1982. Despite inflation hitting a 39-year high, all three major benchmarks advanced. The S&P500 closed at a record, up 0.95%, the Dow up 0.6% and the tech heavy Nasdaq up 0.7%.
Australian shares are set to open higher. The futures are suggesting a rise of 0.18%.
What to watch today:
- Keep watch of Fortescue Metals (ASX:FMG). On Friday the company announced its CEO, Elizabeth Gaines is stepping down and transitioning into the role of Non-Executive Director. FMG fell 0.8% on Friday, following the announcement.
- Oil gained traction to near $72 a barrel on Friday, attempting to fully recover from a 2% drop the day before. Gold is also trading higher, while the seaborne iron ore price is 1.4% lower, trading at US$105 a tonne.
Trading ideas:
- Bell Potter have a Speculative BUY rating on Liontown Resources (ASX:LTR), with a $2.15 valuation. The company is now funded to commence development at the Kathleen Valley lithium project and is in a stronger position to negotiate long term sales contracts. LTR last closed at $1.64, implying 31% share price growth in a year.
- Trading Central’s analysts have identified a bullish signal in Tietto Minerals (ASX:TIE). This bullish signal indicates that the stock price may rise from the close of $0.42 to the range of $0.48 - $0.50, within 18 days.
Fears of the new Omicron variant subsided this week, as the market rallied 2% (Mon-Thu). All sectors made solid gains, with the energy, consumer staples, real estate and healthcare sectors advancing the most.
In this week’s wrap, Sophia covers:
- (0:36) Metcash (ASX:MTS) gaining 12% after strong half-year results
- (1:13) The biggest movers in the All Ords
- (1:33) What stocks Bell Direct clients were trading this week
- (2:11) Bell Potter's top 12 gold mining stocks
- (4:26) Three economic news items to watch out for
Watch the Weekly Wrap here.
The Aussie share market advanced for the fourth straight day yesterday, up as much as 1.7%, before pulling back and closing a modest 1.3% higher.
All sectors posted gains, with the consumer services, information technology and materials sectors leading the way, all up 2%. The banks performed well, with NAB up 1%, the most out of the major four banks.
Zip (ASX:Z1P) was the best performer, lifting 10.9%, after UBS upgraded its rating from a SELL to NEUTRAL. Mesoblast (ASX:MSB) blasted 10% higher, likely because of the broader gains in the Health Care Index, the XHJ, where nearly all members recorded gains. Other top stocks included mining companies, Mineral Resources (ASX:MIN), Champion Iron (ASX:CIA) and Pilbara Minerals (ASX:PLS).
Meanwhile, the worst performing stocks yesterday included Steadfast Group (ASX:SDF), Polynovo (ASX:PNV) and global packaging manufacturer, Orora (ASX:ORA).
Fortescue Metals (ASX:FMG) was one of the most traded stocks by Bell Direct clients yesterday, jumping 3.3% yesterday following news that the company is teaming up with AGL Energy (ASX:AGL) to develop a hydrogen hub for the Hunter Valley coal plants, and off the back of the recent rebound in the iron ore price, which pushed 7% higher.
Moving to the US, as at the time of recording, stocks are flat. All three of the benchmarks are trading slightly higher, with the Nasdaq up the most. Some of the comeback was off the back of vaccine news from Pfizer and BioNTech, who confirmed that three doses of the vaccine are effective at neutralising the Omicron variant.
Following the relatively positive session over on Wall Street, the futures are suggesting the Aussie share market will give back some of its recent gains and open 0.5% lower.
What to watch today:
- Keep an eye on Webjet (ASX:WEB). Goldman Sachs retained its BUY rating, albeit with a trimmed price target of $6.90.
- Oil prices steadied and edged slightly higher as investors assess the impact of the Omicron variant on the global economy. And the gold price gained as the US dollar retreated, with the focus on US inflation data out at the end of the week.
- Lastly, Select Harvests (ASX:SHV) are set to go ex-dividend today.
Trading ideas:
- Citi reiterated its BUY rating on Insurance Australia Group (ASX:IAG) with a price target of $5.60 following its recent business update.
- Bell Potter have maintained its BUY rating on software company Life360 (ASX:360) with an increased price target of $16.25 (previously $14.75). Bell Potter believe there are several catalysts for the stock going forward including achieving its 2021 guidance, as well as a likely dual listing on the NASDAQ sometime in the second quarter of 2022.
Yesterday the market closed higher for the third straight session, advancing 0.95%. Apart from utilities, every other sector moved higher. Energy led the gains, rising more than 2%.
Tech stocks rebounded, with Zip Co (ASX:Z1P), Nearmap (ASX:NEA), and Tyro Payments (ASX:TYR) all making the top 10.
Travel stocks also rebounded as investors grow more confidence that the new COVID-19 Omicron variant wouldn’t have a devastating impact. Corporate Travel Management (ASX:CTD) and Flight Centre (ASX:FLT) made the leaderboard, posting gains of over 5%, while Qantas (ASX:QAN) and Webjet (ASX:WEB) also moved higher.
Magellan Financial Group (ASX:MFG) was the worst performer yesterday, after the news that their CEO Brett Cairns will be leaving the company after 14 years.
US equities rallied overnight, and all three major benchmarks closed in the green. The Dow Jones gained 1.4%, and the S&P500 gained 2.07%. The Nasdaq had its best day since March, gaining 3%, with tech stocks leading the market higher for a second day.
Following New York, the ASX200 is set to rise 0.3% at the open this morning, going by the SPI futures.
What to watch today:
- Tech stocks are likely to do well today, following the tech rally in the US.
- National Bank of Australia (ASX:NAB) may be under pressure as they face court action. The Financial Services Union is taking the bank to Federal Court, amid claims their staff are overworked.
- The oil price is trading more than 3% higher at US$71 per barrel.
- Gold is currently higher, above US$1,780 an ounce.
- The seaborne iron ore price is trading over 4% higher at US$108 a tonne.
Trading idea:
- Bell Potter maintain their BUY rating on The a2 Milk Company (ASX:A2M) with a $7.70 price target. Bell Potter believe EPS could double by FY26, if the company can execute on the China offline expansion strategy, while recovering a 50% sales loss for FY20-21 in English label infant milk formula. A2M is also a Citi and UBS BUY. And the stock closed yesterday at $5.61, implying 37.3% share price growth in a year.
The Aussie share market started the trading week to yet another choppy and directionless trading session, in which gold miners and supermarkets gained ground, while tech stocks slumped.
Embattled property giant, Evergrande fell as much as 15% to an eleven-year low, after it said that there was no guarantee that it would have enough cash to meet its next debt repayments.
The utilities sector advanced the most, up 2%. Meanwhile, the information technology sector was hit the hardest, down 2.2%, following some major losses on the tech-heavy Nasdaq last Friday. Metcash (ASX:MTS) was the top stock of the day, up 7.3%, after the company released strong first half results, as more Aussies shopped local during lockdown. The company also announced its plans to inject $4 million into digital technology to accelerate online shopping across its food, grocery, hardware, and liquor brands. There were also six gold miners that made the stock leaderboard, including Silver Lake Resources (ASX: SLR) and Gold Road Resources (ASX:GOR). On the flipside, BNPL stocks came under pressure, including Zip (ASX:Z1P), Afterpay (ASX:APT) and Sezzle (ASX:SZL), which were down 10.1%, 4.3% and 16% respectively. Kogan.com (ASX:KGN), Nearmap (ASX:NEA) and Redbubble (ASX:RBL) were also amongst the worst performers, with this trio of technology stocks to be removed from the XJO later this month.
In the US, all three benchmarks advanced, as investors shook off fears around the threat of the Omicron variant. The Dow closed nearly 650 points higher, the S&P500 up over 1% and the Nasdaq up 0.9%. Shares linked to the economy recovery gained, while investors continued to sell tech stocks with relatively high valuations.
What to watch today:
- Following a positive session over on Wall Street, the futures are suggesting the Aussie share market will lift 0.3% at the open.
- The RBA meets for the final time this year to discuss the cash rate. While it’s expected to remain at 0.10%, the RBA could provide an update on when its first hike will occur.
- It’s worth keeping an eye on Magellan Financial Group (ASX:MFG) after the announcement its CEO Dr Brett Cairns had resigned for personal reasons.
- Oil prices rebounded 5% on hopes the Omicron variant would have a less damaging impact on the economy if symptoms proved to be mostly mild. The gold price fell 0.3% to US$1,778 an ounce, while the seaborne iron ore price traded 2.2% higher to about US$104 a tonne.
- Bank of Queensland (ASX:BOQ) are holding their AGM today.
Trading Ideas:
- Bell Potter have a SPECULATIVE BUY rating on biotechnology company, Kazia Therapeutics (ASX:KZA) with a valuation of $2.40. Kazia recently reported the headline data from its phase II clinical trial. The highlights included that median progression free survival and median overall survival was extended by three months. The next catalyst for the stock will be the first readouts from investigator led studies currently underway in the US. At its current share price of $1.20, this implies 100% share price growth in a year.
- Trading Central has detected a bullish charting signal in BWP Trust (ASX:BWP). This signal indicates that the stock price may rise from the close of $4.21 to the range of $4.30-$4.32 in the next 18 days, according to standard principles of technical analysis.
The Aussie market ended last week with gains, with the energy sector rising the most, up 1.6%. The energy sector was led by Oil Search (ASX:OSL), Whitehaven Coal (ASX:WHC), BlueScope Steel (ASX:BSL) and Nickel Mines (ASX:NIC), which all ended the week higher. The financials also performed well on Friday after a volatile week. Meanwhile healthcare declined.
Imaging software company Pro Medicus (ASX:PME) made the most gains on Friday, however its share price is still down the past month. Aussie investment company, Washington Soul Pattinson (ASX:SOL) gained 3.3%, partly due to its exposure to energy investments. While, TPG Telcom (ASX:TPG) dropped 8.6%, off the back of news that its founder was selling a $335 million stake in the company.
In US equities, all three major benchmarks closed lower, wrapping up a volatile week. The Omicron variant has had investors concerned, and the US also delivered a disappointing jobs report, with slower than expected job creation last month. The Dow was down 0.2% and the S&P500 down 0.8%. The tech-heavy Nasdaq dropped 1.9%, with Tesla falling over 6% and Zoom falling over 4%.
There was however a late rally on Wall Street, and the ASX200 is set to open higher this morning. The SPI futures are suggesting a rise of 0.15% at the open.
Citing concerns on the Omicron strain, Goldman Sachs cut its forecast for US economic growth in 2022 from 4.2% to 3.8%. They say a downside scenario is the most likely outcome, where the virus spreads quicker, but immunity against hospitalisations falls slightly more.
What to watch today:
- Oil is trading lower at US$66 a barrel. Watch Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
- Gold is currently higher, however has fluctuated around $1,770 an ounce, after the disappointing US jobs report.
- The seaborne iron ore price is lower, trading at US$101.49 a tonne.
- Metcash (ASX:MTS) is set to release its half-year results today. Ord Minnett analysts expect the company to report a net profit of $141 million for the past 6 months, allowing for an interim dividend of 10.5 cps.
Trading ideas:
- Bell Potter have maintained their BUY rating on chemical manufacturing company DGL Group (ASX:DGL) and have decreased their price target from $3.05 to $3, after the company held its AGM. DGL last closed at $2.40, implying 25% share price growth in a year.
- Goldman Sachs have a BUY rating on Healthco Healthcare and Wellness (ASX:HCW), with a $2.56 price target. The broker says that the healthcare real estate sector in Australia is in its infancy, with potential for growth through acquisitions and ground up development.
- Trading Central’s analysts have flagged a bullish signal in Hastings Technology Metals (ASX:HAS). This bullish signal indicates that the stock price may rise from the close of $0.25 to the range of $0.30 to $0.32, within 28 days.
The new Omicron COVID-19 variant pushed global markets lower this week, with the Aussie share market trading down 0.7% (Mon-Thu). Plus, Aussie investors digested key economic data, including better-than-expected September quarter GDP.
In this week’s wrap, Sophia covers:
- (0:28) The latest GDP and balance of trade data
- (1:51) Top performer, Collins Foods' (ASX:CKF) strong half-year results
- (2:11) Lynas Rare Earths' (ASX:LYC) gain after broker upgrade
- (3:10) Bell Potter's must have stocks in a portfolio
- (6:50) What stocks Bell Direct clients were trading this week
As the omicron variant continues to spread, and the Federal Reserve flags that they will consider winding down bond purchases sooner, the Aussie share market closed 0.28% lower, a near two-month low. The market did manage to recover in the afternoon after better-than-expected GDP data and a positive outlook for Chinese growth. The lockdowns in NSW and Victoria drove a 1.9% contraction in the economy for the third quarter, which was less than the 2.7% decline expected. As household spending crashed, levels of savings surged.
Nearly all sectors were in the red: consumer staples, utilities and real estate sectors led the losses, while the materials, healthcare and financial sectors managed to post gains. The top stocks included South32 (ASX:S32), Waypoint REIT (ASX:WPR) and Lynas Rare Earths (ASX:LYC). GUD Holdings (ASX:GUD) headed south, after a discounted share placement. Other worst performers included Pro Medicus (ASX:PME) and IDP Education (ASX:IEL).
The most traded stocks by Bell Direct clients yesterday included Fortescue Metals (ASX:FMG), Telstra (ASX:TLS) and OZ Minerals (ASX:OZL).
In the US, all three benchmarks gave up decent gains and turned negative after the first omicron case was confirmed in the US. The Dow closed over 450 points lower, the S&P500 was down 1.2% and the Nasdaq fell 1.8%. Travel stocks were hit hard: American Airlines, Delta Airlines and United Airlines all fell over 7%. And on the data front, private payroll data for November showed 534,000 jobs were added, above expectations of 506,000.
Following the negative session over on Wall Street, the futures are suggesting the Aussie share market will fall about 1.1% at the open.
What to watch today:
- Economic news out today includes Australia’s balance of trade data for October (difference between what we export vs. what we import). Australia's trade surplus decreased to A$12.24 billion in September and consensus expects trade surplus to decrease again to A$11 billion in October. Retail sales for November and home loans for October will also be released today.
- Moving to commodities, oil prices fell into the red in late afternoon trading on Wednesday. The WTI settled 1.63% lower to US$65.10 a barrel. The gold price rose, as investors used the safe-haven asset as a hedge against wider market volatility and demand was boosted as the US dollar fell. And the seaborne iron ore price traded 8% higher to US$103 a tonne.
- A few companies going ex-dividend today, including ALS Limited (ASX:ALQ), Fisher & Paykel Healthcare (ASX:FPH), Pendal Group (ASX:PDL) and TechnologyOne (ASX:TNE).
- Portman’s and Peter Alexander owner Premier Investments (ASX:PMV) holds its AGM today.
Trading Ideas:
- Citi has a BUY rating on gold miner, Northern Star Resources (ASX:NST), with a price target of $12. NST recently signed a funding deal with Quebec-based gold miner Osisko Mining, whereby under the deal, NST will contribute $169 million to Osisko via a convertible senior unsecured debenture. NST closed flat yesterday at $9.44, which implies around 27% share price growth in a year.
- Trading Central has detected a bullish charting signal in pharmaceutical company Starpharma (ASX:SPL). This signal indicates that the stock price may rise from the close of $1.21 to the range of $1.35-$1.39 in the next 32 days, according to stand principles of technical analysis.
Yesterday morning, Australian shares made an impressive rebound, rising 1.3% at its highest level of the session, however soon after started to decline and closed with a smaller gain of 0.2%. Selling began off the back of reports from the CEO of Moderna, who told the press yesterday that existing vaccines will struggle against the new omicron COVID-19 variant. This saw the US futures for last night decline and Aussie shares drop as well. By close of trade, communications services advanced the most, up 1.8%. This was followed by real estate and consumer staples. Meanwhile utilities declined the most, down 1.2%.
Collins Foods (ASX:CKF) gained 12.6% off the back of reporting its half-year results. The KFC owner delivered a 9.5% increase in revenue to a record $534.2 million, and a 31.6% increase in underlying NPAT to $28.9 million. CKF also reported a fully ranked interim dividend up 14% to 12 cps. The worst performing stock of the day was St Barbara (ASX:SBM), and other gold miners such as Perseus Mining (ASX:PRU) and Regis Resources (ASX:RRL) also declined.
In US equities, all three major benchmarks closed lower, after Federal Reserve chairman Jerome Powell said the central bank will discuss speeding up the bond-buying taper at its December meeting. The Dow dropped 650 points, the S&P 500 down 1.9% and the tech heavy Nasdaq down 1.6%.
Taking direction from the broad sell off in New York, the ASX200 is set to open lower, with the SPI futures suggesting a drop of 0.5%.
What to watch today:
- Economic data out today includes Manufacturing PMI for November, as well as third quarter GDP, which will be released at 11:30am AEDT.
- As US investors repositioned for a faster taper by the US Central Bank, oil, gold and iron ore all fell. The oil price is down 4.5%, trading at US$66 a barrel. The gold price is trading at just below US$1,775 an ounce as the dollar index and yields reversed early losses. And the seaborne iron ore price is now slightly higher at US$94 a tonne.
- Now around 20 stocks and ETFs are set to go ex-dividend today, which often sees shares fall. Some include Aristocrat Leisure (ASX:ALL), Incitec Pivot (ASX:IPL) and United Malt Group (ASX:UMG).
Trading ideas:
- Ord Minnett retain their BUY rating on several gold mining stocks, advising three ways to play the gold market. Their first strategy recommendation is to buy a basket of liquid stocks with strong exposure to passive products, to mitigate risk. The second, is for the stock to have strong fundamentals and upcoming catalysts. And the third involves long term investments. Some of the gold miners Ord Minnett retained their buy rating on, include Alkane Resources (ASX:ALK) with a $1.50 price target, Gold Road Resources (ASX:GOR) with a $1.70 price target, and Aurelia Metals (ASX:AMI) with a $0.95 target.
- Bullish charting signals have been identified in Ioneer (ASX:INR) and 4D Medical (ASX:4AX), according to Trading Central.
The ASX200 closed in the red yesterday, down 0.5%, in what was a rollercoaster session for the benchmark index, driven by investor fears about the new omicron COVID-19 variant.
Only two of the eleven sectors were higher, materials and information technology. While the real estate and energy sectors came under pressure, down 1.4% each.
The biggest gainers included HUB24 (ASX:HUB), Bapcor (ASX:BAP) and Domino’s Pizza (ASX:DMP). Mineral Resources (ASX:MIN) lifted 3.4% after the company announced it had entered into a port and rail agreement. And healthcare company, Healius (ASX:HLS) benefited from elevated demand for COVID-19 testing services. Travel stocks suffered as Aussie states initiated tougher quarantine rules on arrivals from nine African countries. The largest falls however, were for shopping centre owners, Unibail-Rodamco-Westfield (ASX:URW) and Vicinity Centres (ASX:VCX).
In the US, all three benchmarks closed higher and recovered from Friday’s sell-off. This follows President Joe Biden stating that that economic lockdowns in response to the omicron COVID-19 variant are currently off the table. Mega-cap tech stocks were amongst the biggest winners.
Today, the Aussie share market is set to rise amid a broad rebound in equities and commodities. The futures are suggesting a lift of 0.6%.
What to watch today:
- Economic data out today includes building permits and private sector credit.
- Looking at commodities, following its worse day in 2021, oil prices bounced back on Monday. The WTI gained 2.6% to settle at US$69.95 a barrel. The gold price eased, as the dollar firmed, and the spot iron ore price traded down 4% to US$96.50 a tonne.
- KFC owner, Collins Foods (ASX:CKF), is set to release its half year results. While no guidance has been given, the business plans to build 9 to 12 KFC restaurants in Australia this financial year. Macquarie is bullish on the stock, currently holding an outperform rating and $14.75 price target.
- Companies holding their AGMs today include Starpharma (ASX:SPL), Orocobre (ASX:ORE) and Omni Bridgeway (ASX:OBL).
- Spark Infrastructure Group (ASX:SKI) is set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained their BUY rating on technology hardware and equipment company, EROAD (ASX:ERD) with a decreased price target of $5.95 (previously $6.05). This follows EROAD’s mixed first half 2022 result, which was impacted by slightly higher operating and R&D costs, while group revenue was up 4.8% year-on-year. Separately, EROAD is in the early stages of expanding its platform offering and enterprise sales initiatives in North America and Australia. EROAD closed flat yesterday at $4.70, which implies 26.6% share price growth in a year.
- Bullish charting signals have been identified in Bannerman Energy (ASX:BMN), Redbubble (ASX:RBL) and Sparc Technologies (ASX:SPN), and that’s according to Trading Central.
We’ve seen a broad sell off across global financial markets amid fears of the new COVID-19 variant identified in South Africa. It has sparked concerns that the virus could again set back economic recoveries worldwide.
The Aussie market tumbled 1.7% on Friday. All sectors declined and energy stocks took the biggest hit felling 4.5%. Gold miners finished lower most of last week, however rebounded on Friday after the gold price pushed higher. Meanwhile, travel stocks were hit hard, amid fears of the omicron variant. Webjet (ASX:WEB), Qantas (ASX:QAN), Corporate Travel Management (ASX:CTD) and Flight Centre (ASX:FLT) all fell. Machine intelligence company Appen (ASX:APX) was the worst performer on Friday after Macquarie downgraded APX to an underperform rating and decreased its price target to $9.50 from $11.80.
US equities fell in a short post-thanksgiving session. The Dow had its worst day of the year, falling 900 points, or 2.5%. The S&P500 fell 2.3%, while the Nasdaq fell 2.2%.
Today, the ASX200 is set to fall for a second session, with the SPI futures suggesting a sharp drop of 1.4%.
What to watch today:
- The oil price has dropped 13% - its worst day of the year, as the omicron variant sparks global demand concerns. Oil is trading at US$68 a barrel. Oil markets had already been under pressure, following the announcement of a coordinated release of crude reserves. So keep watch of energy producers such as Woodside Petroleum (ASX:WPL) and Santos (ASX:STO).
- Gold is trading higher at US$1,792 an ounce. Watch Newcrest Mining (ASX:NCM), Northern Star Resources (ASX:NST) and other gold mining stocks.
- Keep an eye on iron ore stocks like BHP Group (ASX:BHP) and Fortescue Metals (ASX:FMG), after iron ore prices tumbled on Friday night.
Trading ideas:
- Bell Potter maintained their BUY rating on Australia and New Zealand Bank (ASX:ANZ) and have kept their price target unchanged at $31. Bell Potter have noted significant opportunities from decarbonising the economy and the bank is well positioned to facilitate to net zero emissions. ANZ closed on Friday at $27.07, implying 14.5% share price growth in a year.
- UBS have retained their BUY rating on Adairs (ASX:ADH) and have increased their price target from $5.40 to $5.90. Adairs have purchased vertically integrated furniture retailer Focus on Furniture for $80 million. Meanwhile, Ord Minnett upgraded ADH to Accumulate from a Hold, and increased their price target from $4.00 to $4.10.
- Bullish charting signals have been identified in Weebit Nano (ASX:WBT), Zenith Minerals (ASX:ZNC) and Jervois Global (ASX:JRV), according to Trading Central.
The Aussie share market traded slightly higher this week, up 0.15% (Mon-Thu). The materials and utilities sectors made strong gains, while the information technology sector declined the most.
In this week’s wrap, Sophia covers:
- (0:58) EML Payments' (ASX:EML) impressive gain after regulatory resolution
- (2:23) Why the iron ore price lifted this week
- (3:20) TechnologyOne (ASX:TNE) tumbling despite a positive report card
- (4:11) Current broker recommendations on commodities
- (7:07) What stocks Bell Direct clients were trading this week
- (7:47) Economic news items to watch out for
Watch the weekly wrap here.
The ASX200 closed 0.15% lower yesterday, however, is still tracking 1% higher for the month of November.
Energy stocks led the gains, benefiting from a firmer crude oil price. Utilities advanced nearly 1% and both the Real Estate and Healthcare sectors managed to post small gains. The rest of the market closed in the red, with the Tech sector down the most, as bond yields climbed.
The top stocks of the day included Energy stocks like Beach Energy (ASX:BPT), Santos (ASX:STO) and Woodside Petroleum (ASX:WPL). Lendlease Group (ASX:LLC) rose 3.2%, as the company is in discussions with Google to potentially develop data centres. And leading the declines was TechnologyOne (ASX:TNE). Its share price has continued to slide since the release of its full year results on Tuesday.
The most traded stocks by Bell Direct clients yesterday included AVZ Minerals (ASX:AVZ), Commonwealth Bank (ASX:CBA) and Westpac (ASX:WBC), while both Vanguard’s Australian Shares ETF (ASX:VAS) and International Shares ETF (ASX:VGS) made the top ten.
In the US, the Dow closed slightly lower, while the S&P500 and Nasdaq managed to post gains, as the recent jump in bond yields cooled down.
This morning, the futures are suggesting the Aussie share market will open slightly higher this morning, up 0.12%
What to watch today:
- In economic data, Private Capital Expenditure for Q3 will be released this morning. This measures the change in the total inflation-adjusted value of new capital expenditures made by private businesses.
- Oil prices steadied as investors questioned Biden’s strategic oil stockpile release. The crude oil price is currently trading at US$78.28.
- The gold price came under pressure following the release of strong US economic data, which appears to be supporting an increase in interest rates. And the spot iron ore price was up 2% to US$92.50 a tonne, while the seaborne iron ore price trades higher at US$94.33
- Fisher & Paykel Healthcare (ASX:FPH) released their half year results this morning. Compared to the same period last year, NPAT was down 2%, operating revenue was also down 1%, while its interim dividend was increased by 6% to 17cps.
- IOOF Holdings (ASX:IFL), Evolution Mining (ASX:EVN), NRW Holdings (ASX:NWH) Regis Resources (ASX:RRL), Kogan (ASX:KGN) and Ramelius Resources (ASX:RMS) will hold their AGM today.
- Nufarm (ASX:NUF) and Australian Vintage (ASX:AVG) are set to go ex-dividend today.
Trading Ideas:
- Bell Potter have maintained their BUY rating on funeral business, Propel Funeral Partners (ASX:PFP) and have increased its price target to $5 (previously $4.90). PFP closed 3% higher yesterday to $4.44, which implies 12.7% share price growth in a year.
- Bullish charting signals have been identified in Strandline Resources (ASX:STA), Capricorn Metals (ASX:CMM) and OM Holdings (ASX:OMH), according to Trading Central.
The ASX200 closed 0.8% higher, with Energy and Materials sectors making the strongest gains. All but three sectors advanced.
Iron ore miners rose higher in response to the higher iron ore and oil prices in the spot market. Fortescue Metals (ASX:FMG) advanced almost 10% by close of trade.
While gold miners fell yesterday, as the price of gold fell to a three-week low and the Australian dollar was down to a seven-week low. This saw Silver Lake Resources (ASX:SLR) down 5.6%.
Meanwhile Bapcor (ASX:BAP) was the worst performer, after the company’s founder and CEO announced his departure.
In US equities, the S&P500 rose 0.2% and the Dow rose 0.6%. However, rising treasury yields weighed down on the major tech stocks and the tech-heavy Nasdaq closed 0.5% lower, falling for the second consecutive day.
The ASX200 is set to open flat this morning, with the SPI futures suggesting a modest rise of just 0.01%.
What to watch today:
- The oil price is up 2.3% after an announcement of a coordinated release of oil reserves in the US, India, China, Japan, Republic of Korea, and the UK, in a bid to depress prices.
- Gold is trading below US$1,800 an ounce, the lowest level in three-weeks, following Jerome Powell’s reappointment.
- Spot iron ore is trading almost 5% higher and the seaborne iron ore price is trading higher at US$94 a tonne.
- Webjet (ASX:WEB) released its half year results this morning. The company reported significant positive cash generation, with cash surplus of $3.5 million per month, as well as increases in Total Transaction Volume, Revenue and EBIT.
- Harvey Norman (ASX:HVN) and Ramsay Health Care (ASX:RHC) will hold their AGM today.
- Graincorp (ASX:GNC), HGL Limited (ASX:HNG) and Whitefield (ASX:WHF) are set to go ex-dividend today. This often sees shares fall as investors take their profits.
Trading ideas:
- Bell Potter maintain their BUY rating on Nickel Mines (ASX:NIC) and have increased their price target from $1.42 to $1.68. Nickel Mines has advanced over 17% over the last week, and closed yesterday at $1.31, implying 27.8% share price growth in a year.
- Bullish charting signals have been identified in Tabcorp Holdings (ASX:TAH), Orocobre (ASX:ORE) and Centaurus Metals (ASX:CTM) according to Trading Central.
The ASX200 started the week in the red, down 0.6% yesterday, with travel stocks coming under pressure and all four of the big banks closing between 1-2% lower.
Nickel Mines (ASX:NIC) closed about 8% higher after it signed a memorandum of understanding with Shanghai Decent Investment as a framework for future development projects.
The US market was mixed. The Dow managed to gain 0.05%, however both the S&P500 and Nasdaq came under pressure. Biden announced that he would renominate Jerome Powell to continue to lead the Federal Reserve, which saw bond yields rise and bank stocks gain, while tech stocks lost strength.
After a mixed session on Wall Street, the futures are suggesting the Aussie share market will open slightly lower this morning, down 0.16%.
What to watch today:
- Building Permits for October will be released today, which essentially shows the monthly change in the number of total dwelling units approved, including building activity carried out on existing buildings.
- Oil prices rose on Monday but continue to remain under pressure given rising COVID-19 cases in Europe. While the gold price fell over 2% as the US dollar firmed and off the back of Powell’s renomination.
- Watch BHP Group (ASX:BHP) and Woodside Petroleum (ASX:WPL) following WPL’s $40 billion deal to absorb BHP’s petroleum assets via an all stock merger was finalised by both companies’ boards yesterday.
- TechnologyOne (ASX:TNE) is set to release its full year results today.
- AGMs today include Brickworks (ASX:BKW), Mayne Pharma (ASX:MYX), Monadelphous Group (ASX:MND), Link Administration Holdings (ASX:LNK) and Pro Medicus (ASX:PME).
- Amcor (ASX:AMC) is set to go ex-dividend today.
Trading ideas:
- Bell Potter have maintained their BUY rating on mineral drilling contractor, DDH1 (ASX:DDH) and have increased its price target to $1.52 (previously $1.48). DDH closed 1.3% higher yesterday, which implies 29% share price growth in a year.
- Bullish charting signals have been identified in Silex Systems (ASX:SLX), People Infrastructure (ASX:PPE) and Lake Resources (ASX:LKE) and that’s according to Trading Central.
On Friday the ASX200 edged 0.2% higher. Healthcare, Consumer Staples and Materials made the most gains, while the Industrials and Information Technology sectors declined the most.
Casino group, Crown Resorts (ASX:CWN) rose more than 16% on Friday, off the back of news that US private equity group Blackstone, who currently own 10% of Crown, put forward a merger proposal, bidding $12.50 cash per share. The board are currently considering the offer.
The most traded stocks by Bell Direct clients on Friday included the BetaShares Gold ETF (ASX:QAU) and Queensland Pacific Metals (ASX:QPM).
In overseas markets, European markets closed lower as Austria re-enters a national lockdown. US equities also struggled on Friday; however tech share posted a winning week. Global markets were weighed down by heightened inflation and COVID-19 concerns.
Today, following European & US markets, the SPI futures are suggesting the ASX200 will fall 0.6% at the open.
What to watch today
- The oil price is trading 3.7% lower, below US$76 a barrel, nearing levels not seen in 7-weeks.
- Gold is trading at its lowest level in 2-weeks.
- The seaborne iron ore price has moved slightly higher, trading just above US$92 a tonne.
- Elders (ASX:ELD) is set to go ex-dividend today. Last week the company announced a final dividend of 22cps franked to 20%.
Trading ideas:
- Bell Potter has maintained their BUY rating on footwear retailer and distributer Accent Group (ASX:AX1) and have increased their price target from $2.90 to $3.05. AX1 recovered from early losses on Friday, closing at $2.68, which implies 13.8% share price growth in a year.
- Bullish charting signals have been identified in Ardea Resources (ASX:ARL) and Breville Group (ASX:BRG) according to Trading Central.
The Aussie share market declined 0.9% (Mon-Thu). Financials took a hit after the Commonwealth Bank (ASX:CBA) released a disappointing Q1 result, while wage growth saw its strongest annual rise since March 2020.
In this week’s wrap, Sophia covers:
- (0:22) Key takeaways from the latest wage growth data
- (2:17) Nickel Mines (ASX:NIC) gains 9% as production output is brought forward
- (3:27) Why CBA's report card saw its share price tumble 10%
- (4:20) What stocks Bell Direct clients were trading this week
- (5:12) An update on Chinese equities and the Evergrande situation
- (6:33) Four economic news items to watch out for
Watch the weekly wrap here.
Aussie shares came under pressure yesterday, with the ASX200 closing 0.7% lower. The Financials sector weighed down on the market following Commonwealth Bank of Australia (ASX:CBA) releasing a disappointing Q1 result, which came in below market expectations. The best performing sector was the Tech sector which lifted a modest 1.6%.
Telecommunications business, Uniti Group (ASX:UWL) lifted 8.3%, following an update on its share buyback and operational performance. While, Nufarm (ASX:NUF) fell 8.6% despite reporting a strong full-year result.
All three US benchmarks closed lower despite strong retail earnings reports. This comes as inflation concerns continue to linger and some retailers revealing margin pressures. The Dow fell 0.5%, the S&P500 closed 0.2% lower, while the Nasdaq slipped 0.3%.
After a negative session on Wall Street, the futures are suggesting the Aussie share market will open slightly lower this morning.
What to watch today:
- Evolution Mining (ASX:EVN) announced yesterday that it will grow its exposure to copper and silver, after agreeing to pay $1 billion for Glencore’s Ernest Henry mine in Queensland. As EVN’s copper production will increase, this will lower its all-in sustaining cost per ounce and help cement EVN as one of the lowest cost gold producers in the world.
- Aristocrat Leisure (ASX:ALL) are set to release their full year results.
- Goodman Group (ASX:GMG), Mineral Resources (ASX:MIN), Northern Star Resources (ASX:NST) and BlueScope Steel (ASX:BSL) are holding their AGMs today.
- Cobram Estate Olives (ASX:CBO), James Hardie (ASX:JHX) and Vita Group (ASX:VTG) are going ex-dividend today.
- Oil prices fell amid oversupply warnings and as COVID-19 cases in Europe increased. The WTI crude oil price fell 3.5% and is currently trading at US$77.90 a barrel. While the gold price rose following inflation worries, boosting the appeal of the safe-haven metal.
Trading ideas:
- Commonwealth Bank of Australia (ASX:CBA) released its Q1 results yesterday, and a few brokers have revised their views. Citi has a SELL rating on CBA with a price target of $94.50. Bell Potter maintain their BUY recommendation on the stock, however, have reduced their price target by 6%, from $118 to $111. Ord Minnett has a HOLD rating on CBA with a price target of $95. And Goldman Sachs has retained its SELL rating and cut its price target to $81.74.
- Bullish charting signals have been identified in Uniti Group (ASX:UWL), NEXTDC (ASX:NXT) and Red River Resources (ASX:RVR) and that’s according to Trading Central.
The ASX200 fell 0.7% yesterday following a sell-off in Mining stocks and weaker commodity prices, which saw Materials as the worst performer. BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO) both fell more than 2%. Energy stocks also fell, including Santos (ASX:STO), Oil Search (ASX:OSH) and Woodside Petroleum (ASX:WPL). Most sectors were lower, except Information Technology. Chalice Mining (ASX:CHN) was back on top yesterday, rising 3.7%. Virgin Money (ASX:VUK) also advanced, following positive gains in its UK listed share on Monday night. Biotech company Mesoblast (ASX:MSB) lost ground, falling over 8%.
In New York the markets had a positive run. The S&P 500 up 0.4%, the Dow up 0.2% and the Nasdaq up 0.8%. US stocks gained after October retail sales data came in better than expected. Sales jumped 1.7%, a good sign for the upcoming holiday season.
The SPI futures are suggesting the ASX200 will rise 0.4% at the open this morning.
What to watch today:
- In economic data, the wage price index will be released today at 10:30am AEDT. That shows the annual change in hourly rates of pay. Consensus expects a rise to 0.5% from 0.4% QoQ and a rise to 2.2% from 1.7% YoY.
- This morning agricultural chemical company Nufarm (ASX:NUF) reported its full-year 2021 results, with strong operational performance and 51% growth in underlaying earnings and cash generation. And the company declared an unfranked dividend of 4 cents per share.
- And AGMs will be held today for City Chic Collective (ASX:CCX) and Seven Holdings (ASX:SVW).
- The most traded stocks by Bell Direct clients yesterday included BHP Group (ASX:BHP) and Mineral Resources (ASX:MIN) amid broad selling in materials, and South32 (ASX:S32) as its price declined amid increased pressure to take into consideration climate change risks.
- The oil price is trading lower at US$80.60 as demand concerns were offset by prospects of tight inventories. Gold is also trading lower, easing earlier session gains. And the seaborne iron ore is trading down 0.4% at US$92 a tonne.
Trading ideas:
- Bell Potter maintain their BUY rating on Technology One (ASX:TNE) and have increased their price target from $13.50 to $15. TNE closed at $13.09 yesterday, implying 14.6% share price growth in a year.
- Goldman Sachs retain their BUY rating on Hipages Group (ASX:HPG), and have increased their price target from $4.90 to $4.95.
The Aussie share market managed to close 0.4% higher yesterday, with the market now up a modest 2% for November. Most sectors closed higher, except for the Energy, Materials and Utilities sectors.
Mesoblast (ASX:MSB) blasted its way to the top of the leaderboard, closing nearly 12% higher after the release of an update on a phase three trial for the therapy’s use in treating chronic heart failure. While, Whitehaven Coal (ASX:WHC) was one of the worst performers, following an international agreement to reduce coal use.
In the US, stocks closed flat to start the new trading week ahead of quarterly results from big US retailers, which will give a further idea about the US economic recovery and inflation pressures.
After a flat session on Wall Street, the futures are suggesting the Aussie share market will open 0.39% lower this morning.
What to watch today:
- In economic news, the RBA meeting minutes will be released at 11:30am AEDT, which will go into more detail to explain the monetary policy decision made earlier this month. And at 1:30pm AEDT, we will hear from RBA Governor Phillip Lowe on recent trends in inflation.
- Property giant, Mirvac Group (ASX:MGR), lithium producer, Pilbara Minerals (ASX:PLS) and Lifestyle Communities (ASX:LIC) are holding their AGMs today.
- Ausnet Services (ASX:AST) is set to go ex-dividend today.
- The most traded stocks yesterday by Bell Direct clients, included Western Areas (ASX:WSA), Fortescue Metals (ASX:FMG) and Imugene (ASX:IMU).
- Oil prices came under pressure amid fears of a supply boost and weakening demand. The gold price pulled back after its 7-day rally, as US bond yields lifted, currently trading at US$1,862. While the seaborne iron ore price trades 1% lower at US$92.36 a tonne.
Trading Ideas:
- Bell Potter has upgraded its rating on chemical manufacturing company, DGL Group (ASX:DGL) from a HOLD to a BUY with a price target of $3.05. DGL’s share price is up 143% since it listed on the ASX earlier this year, and at its current share price of $2.62, implies 16.4% share price growth in a year.
- Morgan Stanley and Bell Potter also reiterated their bullish ratings on Life360 (ASX:360). Morgan Stanley has an Overweight rating and price target of $14.20, while Bell Potter has a BUY rating with an increased price target to $14.75.
- Bullish charting signals have been identified in Boss Energy (ASX:BOE), Paladin Energy (ASX:PDN) and Karoon Energy (ASX:KAR) and that’s according to Trading Central.
On Friday, Aussie shares rebounded and ended the week higher after three days of losses. Mining stocks were the best performers, with Rio Tinto (ASX:RIO), BHP Group (ASX:BHP), Fortescue Metals (ASX:FMG), Champion Iron (ASX:CIA) and Mineral Resources (ASX:MIN) all making gains.
In overseas markets, despite worrisome inflation figures in both the US and China, weighing down on global sentiment last week, European markets still ended the week higher. The S&P500 is up 0.7%, the Dow up 0.5% and the Nasdaq up 1%, with the mega-cap tech names supporting the broader market.
The ASX200 is set to open 0.04% lower this morning, going by the SPI futures.
What to watch today:
- Telstra (ASX:TLS) is set to formally announce its joint venture with data and analytics company Quantium, which is a part of Woolworths Group.
- Companies set to go ex-dividend today include National Australia Bank (ASX:NAB), Plato Income Maximiser (ASX:PL8) and QV Equities (ASX:QVE).
- Elders (ASX:ELD) and Incitec Pivot (ASX:IPL) will both report full year results today.
- On Friday, the major mining stocks were the most traded stocks by Bell Direct clients, as the sector advanced. These included Fortescue Metals (ASX:FMG), Mineral Resources (ASX:MIN), and BHP Group (ASX:BHP). Another highly traded stock was AI and machine learning company BrainChip Holdings (ASX:BRN).
- The oil price has fallen 0.8%, amid concerns that the US could release oil from strategic emergency reserves to curb high oil prices. So watch stocks such as Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
- Gold is trading higher, above US$1,850 an ounce, driven by inflation hedging amid surging US consumer prices. So stocks such as Newcrest Mining (ASX:NCM) and Northern Star Resources (ASX:NST) may rise higher.
- The seaborne iron ore price is currently trading just above US$93 a tonne.
Trading ideas:
- Bell Potter have a Speculative BUY rating on Liontown Resources (ASX:LTR) and have increased their price target from $1.33 to $2.15.
- Trading Central has identified bullish charting signals in Credit Clear (ASX:CCR), Rex Minerals (ASX:RXM) and Sovereign Metals (ASX:SVM).
The Aussie share market has come under pressure this week, down 1% (Mon-Thu). All sectors closed in the red, except for the Materials sector, off the back of positive announcements from a few Mining stocks.
In this week’s wrap, Sophia covers:
- (0:34) The rundown on the latest unemployment reading
- (2:12) Why Chalice Mining's (ASX:CHN) share price skyrocketed
- (3:12) Seven more Mining stocks that saw big gains
- (4:46) Three companies growing their ethical focus
- (6:13) What stocks Bell Direct clients were trading this week
- (6:49) Two economic news items to watch out for
Watch the weekly wrap here.
The Aussie share market fell for the third straight day yesterday, down 0.14%, off the back of a weakening iron ore price with big miners and blue chips leading the falls.
For the second straight day, Chalice Mining (ASX:CHN) has topped the leader board, lifting another 5% following the company’s platinum discovery near Perth. The worst performing stocks were BlueScope Steel (ASX:BSL) and Nearmap (ASX:NEA) which saw declines of 5.8% and 4.9% respectively.
In the US, stocks retreated following October’s consumer price reading coming in at its highest level in 30 years. After inflation data came in higher than estimated, the Dow shed over 200 points, the S&P500 dipped 0.82% and the Nasdaq declined over 1%.
After a negative session on Wall Street, the futures are suggesting the Aussie share market will open 0.08% lower this morning.
What to watch today:
- Today the unemployment rate will be released for October. Given there is uncertainty as to how the transition from lockdowns played out, economists have forecast that the unemployment rate will rise from 4.6% in September to 4.8% in October.
- Keep an eye on cloud accounting platform Xero (ASX:XRO) today, as the company is set to release its half-year results.
- There are a few companies holding theirs AGMs today, including BHP Group (ASX:BHP), Breville (ASX:BRG), Nine Entertainment (ASX:NEC), Nearmap (ASX:NEA), Cooper Energy (ASX:COE) and REA Group (ASX:REA).
- Australian Pharmaceutical Industries (ASX:API) is set to go ex-dividend today.
- Oil prices came under pressure after US crude inventories rose by 1 million barrels, which was short of estimates. Keep an eye on energy shares like Woodside Petroleum (ASX:WPL) and Oil Search (ASX:OSH) which could come under pressure today. And the gold price rose as the US dollar firmed, trading nearly 1% higher at US$1,849 an ounce.
Trading Ideas:
- Bell Potter has maintained its BUY rating on software company Nitro Software (ASX:NTO) with a price target of $4.50. The company entered into a trading halt yesterday morning, last trading at $3.84 per share, which implies 19.4% share price growth. Separately, Morgan Stanley has an Overweight rating on the stock.
- Bullish charting signals have been identified in Alpha HPA (ASX:A4N), Rumble Resources (ASX:RTR) and WiseTech Global (ASX:WTC), and that’s according to Trading Central.
The ASX200 lost 0.2% yesterday. Financials were down – CBA, ANZ and Westpac declined, as did NAB after releasing positive full-year results. NAB reported profits rebounded, increasing 77% and declared a $0.67 final dividend, which is more than double what it paid this time last year.
Chalice Mining (ASX:CHN) jumped an impressive 28.5% after they uncovered the world’s largest nickel sulphide discovery in the last 20 years. Ingham’s Group (ASX:ING) was the worst performer, falling 4.5% and currently a Bell Potter and Citi BUY.
European and US markets closed lower, taking in US producer inflation data. The S&P500 fell for the first time in nine sessions, down 0.4%. The Dow Jones down 0.3% and the Nasdaq down 0.6%.
Despite US equities falling from their records, the SPI futures are suggesting the ASX200 will open 0.27% higher.
What to watch today:
- Medical equipment company ResMed (ASX:RMD) is set to go ex-dividend today.
- AGMs will be held today for Amcor (ASX:AMC), Coles (ASX:COL), Sims (ASX:SGM), Vicinity Centres (ASX:VCX), Mount Gibson Iron (ASX:MGX) and Newcrest Mining (ASX:NCM).
- The most traded stocks by Bell Direct clients yesterday were Northern Star Resources (ASX:NST) and the Crypto Innovators ETF (ASX:CRYP), which has surpassed $100 million in trading volume, its first three days floating on the exchange.
- Keep watching those travel stocks, as yesterday NSW reached 90% fully vaccinated of those over 16 yrs.
- The oil price is trading more than 3% higher, above US$84 a barrel. Gold reached a new 2-month high, amid rising inflation expectations. And, the price of coal is lower, as is seaborne iron ore, currently trading just under US$92 a tonne.
Trading ideas:
- Bell Potter maintain their BUY rating on National Australia Bank (ASX:NAB), and have increased their price target to $32, after the bank reported impressive full year results, which were mostly in line with expectations. Yesterday NAB closed at $28.89, implying 10.8% share price growth in a year.
- Additionally, bullish charting signals have been identified in Boss Energy (ASX:BOE), Lotus Resources (ASX:LOT) and De Grey Mining (ASX:DEG), according to Trading Central.
Yesterday, the ASX200 broke its 3-day winning streak, dipping 0.06% or 4 points, as blue chips, tech and healthcare stocks weighed down on the market.
Sector wise, the market was mixed. The energy sector was strong, up nearly 2%, while the tech sector was the worst performer, which fell 1.72%. Travel stocks performed well: Flight Centre (ASX:FLT), Webjet (ASX:WEB) and Qantas (ASX:QAN) all advanced between 4-6% as the nation’s border restrictions were set to ease, allowing vaccinated travellers to enter the United States for non-essential reasons. Sydney Airport (ASX:SYD) rose 2.8% yesterday after its board accepted the $23.6 billion takeover offer. The worst performers: tech shares Xero (ASX:XRO), EML Payments (ASX:EML) and Appen (ASX:APX) all came under pressure, however the worst performer was medical device company PolyNovo (ASX:PNV) which fell nearly 10% after its Managing Director Paul Brennan handed in his resignation.
In the US, all three benchmarks lifted, with the Dow advancing over 100 points. This comes after Congress passed a more than $1 trillion infrastructure bill, now awaiting President Joe Biden’s signature. The package will help provide new funding for transportation, utilities and broadband. The S&P500 pushed forward 0.1% and the tech-heavy Nasdaq rose 0.2%.
After a positive session on Wall Street, the futures are suggesting the Aussie share market will open 0.15% higher this morning.
What to watch today:
- National Australia Bank (ASX:NAB) is set to release its full year results. Morgans expects NAB to report cash earnings from continuing operations broadly in line with consensus estimates and is estimating a fully franked final dividend of 64 cents per share.
- In economic news, business confidence data for October will be released this morning.
- AGMs today: Fortescue Metals (ASX:FMG), Bendigo & Adelaide Bank (ASX:BEN) and cloud communications software & services company MNF Group (ASX:MNF).
- The most traded stocks by Bell Direct clients yesterday included Sydney Airport (ASX:SYD), the Crypto Innovators ETF (ASX:CRYP) and Vulcan Energy Resources (ASX:VUL).
- CSR (ASX:CSR) and Waterco (ASX:WAT) are set to go ex-dividend today.
- Oil prices rose on Monday, following the passing of the US infrastructure bill. The WTI crude oil price was up 1.17% to US$82.22 a barrel. The gold price came close to hitting a two-month high, while the seaborne iron ore price trades at US$94.36 a tonne.
Trading Ideas:
- Bell Potter has maintained its BUY rating on leading mining services company, Mineral Resources (ASX:MIN), however have decreased its price target to $50.45 (previously $54.25). Macquarie and Citi are positive on the stock, Ord Minnett have a HOLD rating, while Morgan Stanley is underweight.
- Bullish charting signals have been identified in Red Dirt Metals (ASX:RDT), Coronado Global Resources (ASX:CRN) and Unibail-Rodamco-Westfield (ASX:URW), according to Trading Central.
The market finished the week with three straight days of gains, closing with 0.4% higher on Friday. The communications services sector gained 1.65%, while energy and information technology sectors were the only two sectors in the red.
IT company Link Group (ASX:LNK) led Friday’s advance, after they received a takeover bid from Carlyle Group, a private equity company in the US. The news saw LNK rise 8.6%. While, Afterpay (ASX:APT) fell more than 5%, after its soon to be listed US parent company Square reported third quarter results which saw its price tumble.
Stocks rallied on Wall Street with all three major benchmarks recorded a winning week. The S&P500 up 0.4%, the Dow up 0.6% and the Nasdaq up 0.2%.
Following US equities, the SPI futures are suggesting the ASX200 will rise 0.3% at the open.
What to watch today:
- Keep watch of Sydney Airport (ASX:SYD). Over the weekend they received the binding offer for IFM Investors and Global Infrastructure Partners to takeover Sydney Airport for $32 billion. The bid is worth $8.75 cash per share and the airport’s board are expected to accept the bid today.
- Australia and New Zealand Bank (ASX:ANZ) and Macquarie Group (ASX:MQG) go ex-dividend today.
- Commonwealth Bank of Australia (ASX:CBA) was one of the most traded stocks by Bell Direct clients on Friday. Broker ratings on CBA vary. The stock is a Bell Potter BUY, while other brokers are not as positive on the stock. CSL (ASX:CSL) was another highly trading stock, gaining over 3% over the week and is now trading at $314.
- The oil price jumped more than 3% higher, after OPEC agreed to stand by their plan to raise oil output by 400,000 barrels per day until December. Gold is also trading higher, as the Bank of England held interest rates at record lows and positive job data came through in the US.
- And the seaborne iron ore price has fallen to US$94.43 per tonne.
Trading ideas:
- Bell Potter have upgraded their rating on coal mining company Bathurst Resources (ASX:BRL) from a HOLD to a BUY, maintaining their price target at $0.98.
- Bullish charting signals have been identified in Firefinch (ASX:FFX), Strategic Elements (ASX:SOR) and Nufarm (ASX:NUF), according to Trading Central.
Yesterday, the ASX200 rallied 0.9%, its best session in a month. Supporting the market was strong gains from the materials sector and major banks, while the tech sector closed in the red, down 0.19%.
The best performer of the ASX200 was AMP (ASX:AMP), its shares closed 9.3% higher after the company agreed to divest its 19.13% equity interest in Resolute Life Australasia for a consideration of $524 million to Resolution Life Group. Tyro Payments (ASX:TYR) was the worst performer, tumbling over 15% after its AGM update.
In the US, all three benchmarks closed at new records following the Fed Reserve confirming that it would begin winding back some of its COVID stimulus later this month and will also reduce buying by $15 billion a month. This puts it on track to end quantitative easing by the middle of next year, which is in line with expectations.
After a positive session on Wall Street, the futures are suggesting the Aussie share market will open 0.50% higher this morning.
What to watch today:
- In economic news, Australia’s balance of trade data for September will be released today at 10:30am AEDT. That’s the difference between what we export vs. what we import. It’s calculated by subtracting the value of the goods and services Australia buys from overseas from the value of the goods and services we sell to other countries. Australia’s trade surplus, increased to a record high of $15.08 billion in August. Third quarter retail sales volumes will also be released today.
- Companies holding their AGMs today include Domain (ASX:DHG), Credit Corp Group (ASX:CCP), Ingham’s Group (ASX:ING), Zip (ASX:Z1P) and Myer (ASX:MYR).
- The most traded stocks by Bell Direct clients yesterday, included three of the big four banks – Westpac (ASX:WBC), CBA & ANZ, as well as lithium company, Lake Resources (ASX:LKE).
- Medusa Mining (ASX:MML) is set to go ex-dividend today.
- Oil prices fell on Wednesday after US crude stocks rose more than anticipated. The WTI crude oil price fell about 4.7% to US$80 a barrel. The gold price also came under pressure, down nearly 1%, and the iron ore price continues to be dragged into a bear market off the back of weakening steel production and an economic slowdown in China.
Trading Ideas:
- Bell Potter has reiterated its BUY recommendation on agricultural chemical company, Nufarm (ASX:NUF), with an increased price target of $5.35 (previously $5.30). NUF is currently up nearly 14% YTD and closed 4.2% higher yesterday to $4.67.
- Bullish charting signals have been identified in Imugene (ASX:IMU), Syrah Resources (ASX:SYR) and Nanosonics (ASX:NAN) and that’s according to Trading Central.
Yesterday, the ASX200 fell about 46 points in a volatile session. Real Estate shares rebounded, while Materials dropped the most. Goodman Group (ASX:GMG) advanced 5.6%, after a positive trading update. Whitehaven Coal (ASX:WHC) was the worst performer. Its shares fell alongside the price of Chinese thermal coal.
In New York overnight, the three major benchmarks closed at a record for the third session in a row. Investors are waiting on a key Federal Reserve decision.
Following US equities, the SPI futures are suggesting the Aussie share market will rise 0.97% at the open.
What to watch today:
- In economic news, yesterday, the RBA held the cash rate at its record 0.10%. The RBA also discontinued its monetary policy measures, its yield curve control, and they will drop the 10-point target on the 3-year bond, expiring 2024.
- Services PMI was released this morning for October, increasing to 52 from 45.5 in September. This indicates a return to expansion, after three months of contraction due to lockdown restrictions.
- AGMs today include Domino’s Pizza (ASX:DMP), Worley (ASX:WOR), Cedar Woods Property (ASX:CWP) and Tyro Payments (ASX:TYR).
- The most traded stocks by Bell Direct clients yesterday were Westpac (ASX:WBC) and Commonwealth Bank of Australia (ASX:CBA), as financials fell, and investors took profits.
- Iron ore declined overnight, with BHP and Rio Tinto closing lower in both London and New York. Expect ASX-listed BHP and RIO to follow. The seaborne iron ore price is currently trading more than 3% lower at US$99.
- Oil is also trading lower as markets await OPEC’s meeting. Spot gold is trading lower, below $1,790 amid a weaker dollar. And the coal price has tumbled 6%, as China aims to boost coal production.
Trading ideas:
- Bell Potter have upgraded software design company Altium (ASX:ALU) from a HOLD to a BUY and have increased their price target by 31% to $42.50, taking into account earnings changes as well as market movements and time creep. ALU closed yesterday at $37.33, implying 13.8% share price growth in a year.
- Bullish charting signals have been identified in Evolve Education Group (ASX:EVO), Aristocrat Leisure (ALL) and Australian Strategic Materials (ASX:ASM), according to Trading Central.
Yesterday, the ASX200 started the month of November with an advance of 0.6%, supported by a busy session of merger and acquisition activity. All sectors of the market gained ground, except for the Financials sector which fell 0.48%.
In the US, the Dow, S&P500 & Nasdaq all closed at record highs to start the month of November. Stocks linked to the economic recovery performed well, including Ford, airlines, and retailers. While mega cap tech stocks underperformed.
After a positive session on Wall Street, the futures as at 7:40am AEDT this morning are suggesting the Aussie share market will open 0.18% higher.
What to watch today:
- In economic news, the Manufacturing PMI for October was released yesterday. The PMI in October was revised to 58.2, which marked the strongest expansion in factory activity in 4 months. As a reminder, given the reading came in above 50 points, that indicates an expansion of the manufacturing sector compared to the previous month.
- Today, the RBA, meets at 2:30pm AEDT to discuss the cash rate. While it’s expected that central bank will keep rates on hold at the current historical low of 0.1%, it’s also expected that the RBA will signal the end of quantitative easing, scrap its yield target framework, and could bring forward its rate hike guidance.
- Keep an eye on travel stocks today after international travel resumed yesterday in Australia for the first time in 600 days. Travel stocks posted solid gains yesterday. Qantas (ASX:QAN) was up 3% and Flight Centre (ASX:FLT) up 2%.
- Brickworks (ASX:BKW) goes ex-dividend today.
- Oil prices rose sharply on strong demand outlook, despite China fuel reserves releasing. And the gold price also rose as the dollar eased.
Trading Ideas:
- Bell Potter has reiterated its BUY recommendation on iron ore company, Fortescue Metals (ASX:FMG), with a revised price target of $19.75. FMG is currently down nearly 39% YTD, and closed 2.9% higher yesterday to $14.33, which implies 37.8% share price growth.
- Bullish charting signals have been identified in AVZ Minerals (ASX:AVZ), Hazer Group (ASX:HZR) and Seek (ASX:SEK) and that’s according to Trading Central.
On Friday, the ASX200 had its worst day in 4-weeks, ending the month slightly lower, falling 0.1% in October. All sectors closed in the red on Friday. Some of the best performers on Friday were GUD Holdings (ASX:GUD) up 6.9%. ResMed (ASX:RMD) also made gains. Its trading update saw revenue climb 20%. Unibail-Rodamco-Westfield (ASX:URW) declined the most despite its centres reopening.
European markets closed mixed, while the US stock market finished at record highs. This was despite disappointing earnings reports from Amazon & Apple.
Following US equities, the SPI futures are suggesting the ASX200 will rise 0.9% today.
What to watch today:
- In economic news, on Friday the Producer Price Index was released. That’s business inflation data, which rose 1.1% in September, which was more than expected. Economic data to look out for today includes the Manufacturing PMI for October. Forecasts expect PMI to be 57.3. PMI above 50 represents an expansion from the month prior. Home Loan data for September will also be released today at 10:30am AEDT.
- More than 15 stocks and ETFs are set to go ex-dividend today. Keep in mind this often sees shares fall as investors take profits.
- The oil price is trading higher, above US$83, ahead of OPEC’s meeting on Thursday, with expectations to maintain production cuts.
- Gold is trading lower as treasury yields are higher, and the dollar is lower. Coal is trading at its lowest levels since the end of September as China struggles with the energy crisis. And the seaborne iron ore price is trading lower at US$121.
Trading ideas:
- Bell Potter maintain their BUY rating on copper production company Aeris Resources (ASX:AIS), on a 4% lower price target of $0.22. They lowered FY22 earnings forecast by 20%, on higher costs and lower production. AIS last closed at $0.16, implying 37.5% share price growth in a year.
- Bullish charting signals have been identified in Syrah Resources (AS:SYR), Incannex Healthcare (ASX:IHL) and Alpha HPA (ASX:A4N), according to Trading Central.
The Aussie share market enjoyed a gain of 0.2% this week (Mon-Thu). Australia's core inflation rate hit a six-year high and all eyes will be on the RBA minutes.
In this week’s wrap, Sophia covers:
- (0:42) Reliance Worldwide (ASX:RWC) gaining 10% after an announcement
- (1:45) Two stocks that saw big gains this week
- (2:19) An idea to compliment US mega cap exposure
- (3:08) What stocks Bell Direct clients were trading this week
- (3:42) Six economic news items to watch out for
Watch the weekly wrap video here.
Yesterday, the ASX200 struggled to find direction for most of the day, finishing flat as investors contemplated the possibility of interest rate hikes happening sooner rather than later. The best performing sector was the Communication Services sector, up 2%, while the Consumer Staples sector fell the most, down 2%. Uniti Group (ASX:UWL) led the gains, up 6%, following the company announcing it will be under taking a share buyback. The worst performer was a2 Milk (ASX:A2M). Investors were selling down a2 Milk shares, after the company released an update that revealed its margins were significantly lower compared to pre-COVID-19 levels.
In the US, the earnings season rally seems to have lost some of its momentum, with the S&P500 slipping from its record high and the Dow falling for the first time in four days. The Nasdaq closed flat, despite Microsoft and Alphabet reporting results that exceeded estimates.
After a mixed session on Wall Street, the futures are suggesting the Aussie share market will open 0.54% lower this morning.
What to watch today:
- In economic news, yesterday, the ABS released its key inflation reading. The Consumer Price Index (CPI) rose 0.8% this quarter. Over the twelve months to the September 2021 quarter, the CPI rose 3.0%. The quarterly rise was driven primarily by a 7.1% jump in fuel and a 3.3% jump in new dwelling purchase costs. Today, investors will hear from RBA Deputy Governor Guy Debelle who will respond to the latest inflation figures.
- Australia and New Zealand Bank (ASX:ANZ) and Fortescue Metals (ASX:FMG) are set to report today. ANZ is set to release its full year results this morning. FMG will release its first quarter update, which should provide investors with an idea of just how badly the pullback in iron ore prices has impacted its margins.
- AGMs wise, there’s 14 companies holding theirs today. To list a few, South32 (ASX:S32), JB Hi-Fi (ASX:JBH) and Boral (ASX:BLD).
- Companies going ex-dividend today include Bank of Queensland (ASX:BOQ) and Centrepoint Alliance (ASX:CAF).
- Oil prices fell on Wednesday after crude stockpiles rose more than expected and fuel inventories unexpectedly increased last week in the US, the world’s largest oil consumer. The gold price steadied off the back of a softer dollar and US bond yields retreating, currently trading at $US1,796 an ounce. And the sea borne iron ore price continues to trade at around US$122 a tonne.
Trading ideas:
- Bell Potter has reiterated its BUY recommendation on IT company, Life360 (ASX:360), a company best known for its family location sharing app. Bell Potter has increased Life360’s price target by 16% to $12.50 (previously $10.75).
- Bullish charting signals have been identified in Carnarvon Petroleum (ASX:CVN), Uniti Group (ASX:UWL) and Tyro Payments (ASX:TYR), according to Trading Central.
Yesterday the Aussie share market closed flat. The Tech sector was the best performer, gaining 1.34%. The worries for BNPL stocks were eased by Macquarie who don’t see an impact on the removal of the no-surcharge rule and kept their outperform rating on Afterpay (ASX:APT). Meanwhile Utilities fell the most.
Casino operators were outperformers yesterday. Crown Resorts (ASX:CWN) rose 8.7%, after receiving approval to continue operating its Melbourne casino, despite regulatory breaches.
Pilbara Minerals (ASX:PLS) also advanced after finalising a joint venture agreement with Korean company POSCO, to operate a lithium conversion facility in South Korea.
Mineral Resources (ASX:MIN) was the worst performer after a quarter update that saw a decline in lithium and iron ore production.
US equities closed higher overnight. Amid strong earnings reports, the Dow rose for the third straight day, the S&P500 rose 0.2% and the Nasdaq also made slight gains. In economic data, US consumer confidence rose in October.
Following US equities, the SPI futures are suggesting the ASX200 will rise 0.05% this morning.
What to watch today:
- In economic news, a key update on the inflation rate will be released at 10:30am AEDT.
- Telstra (ASX:TLS) has announced their acquisition of Digicel Pacific and brokers are optimistic on the news. Goldman Sachs has retained its BUY rating. Morgans have an ADD rating and Credit Suisse have an OUTPERFORM rating.
- Kogan.com (ASX:KGN)’s value has almost halved this year. The stock could potentially fall out of the ASX200 in December’s quarterly rebalance.
- The oil price is trading 0.8% higher, while gold and coal are trading lower. The seaborne iron ore price is trading slightly higher at US$122.
Trading ideas:
- Bell Potter maintain their BUY rating on gold mining and production company Regis Resources (ASX:RRL) and have cut their price target from $4.05 to $3.81.
- Bullish charting signals have been identified in Syrah Resources (ASX:SYR), Pantoro (ASX:PNR) and Nanosonics (ASX:NAN), according to Trading Central.
The ASX200 lifted 26 points or 0.34%, which marks the third straight gain, with the market now tracking 1.5% higher for the month of October. Sectors wise, the energy sector rose the most, up 2.6%, fuelled by further gains in oil prices. The tech sector fell the most, down 0.7%.
The best and worst performers of the ASX200 yesterday included Mineral Resources (ASX:MIN) on top of the leader board, after the company announced that operations would restart at the Wodgina Lithium Mine, in the Pilbara region of WA. The worse performing stock was Perpetual (ASX:PPT), which was down 5%, and this may be due to profit taking after its strong gains last week.
In the US, equities rose to record highs on Monday as investors prepare for a huge week of earnings from heavyweight tech companies. The Dow and S&P500 both closed at record highs and the Nasdaq lifted 0.9%, taking it just 1% off its record high.
Following the gains on Wall Street, the futures are suggesting the Aussie share market will open 0.19% higher this morning.
What to watch today:
- There’s a few companies holding their AGMs later today. These include gold producer Regis Resources (ASX:RRL), Redbubble (ASX:RBL), Sealink Travel Group (ASX:SLK), medical device company Polynovo (ASX:PNV) and Bega Cheese (ASX:BGA).
- Southern Cross Electrical Engineering (ASX:SXE) goes ex-dividend today.
- One of the most traded stocks yesterday by Bell Direct clients was mineral exploration company, Andromeda Metals (ASX:ADN). Its shares came under pressure, falling 11.9% after the market digested its quarterly update.
- Oil prices were mixed - the WTI crude oil price was down 0.1% to US$83.68 a barrel, while the Brent crude oil price rose 0.5% to $85.93 a barrel, as global supply remained tight amid strong demand worldwide. The gold price rose 1% higher on lower US yields and the sea borne iron ore price traded slightly lower at US$122 a tonne.
Trading ideas:
- Bell Potter has reiterated its BUY recommendation on death care services company, Propel Funeral Partners (ASX:PFP) with a price target of $4.90. The stock is currently trading up 48% YTD and at its current share price of $4.21, that implies 16.5% share price growth.
- Bullish charting signals have been identified in Galan Lithium (ASX:GLN), Genex Power (ASX:GNX) and American Pacific Borates (ASX:ABR), according to Trading Central.
Australian shares closed at a one month high on Friday with gains mostly in the Financial and Technology sectors.
On Wall Street, the Dow Jones closed at a record for the first time since mid- August, as investors moved out of Tech stocks and into blue chips. The S&P500 edged slightly lower, down 0.1%, while the Nasdaq fell 0.8%, after disappointing earnings reports from Intel and Snap.
This morning, the SPI futures are suggesting the ASX200 will rise 0.4% at the open, extending last weeks advance.
What to watch today:
- Companies set to go ex-dividend today include Clover Corporation (ASX:CLV), Jupiter Mines (ASX:JMS) and New Hope Corporation (ASX:NHC).
- ASX listed buy now pay later stocks – the RBA has reviewed Retail Payments Regulations and have suggested modifying the BNPL providers ‘no-surcharge’ rule. Some BNPL stocks that may be affected include Afterpay (ASX:APT), Zip (ASX:Z1P), and Splitit (ASX:SPT).
- The oil price is trading 1.5% higher at US$83 a barrel.
- Gold is higher, however trimmed early gains to trade as the US dollar cut losses now that the Fed is ready to begin tapering.
- Coal is trading 15% below its all-time high and the seaborne iron ore price is trading lower at US$122.
Trading ideas:
- Bell Potter maintain their BUY rating on Pantoro Limited (ASX:PNR) with an 11% higher price target of $0.30 (previously $0.27), after a strong quarter report. PNR last closed at $0.21, implying 42.9% share price growth in the year.
- And bullish charting signals have been identified in Frontier Digital Ventures (ASX:FDV), Laybuy Group Holdings (ASX:LBY) and Prescient Therapeutics (ASX:PTX), according to Trading Central.
The Aussie share market is on track to close higher for the third straight week, supported by gains in both the Financial and Real Estate sectors.
In this week’s wrap, Sophia covers:
- (0:58) Why Nickel Mines (ASX:NIC) advanced 11% higher
- (1:54) The impact of Q3 earnings & positive job data in the US
- (3:04) An update on coal plus the Evergrande situation
- (3:45) The most traded stocks by Bell Direct clients
- (4:46) Four economic news items to watch out for
Watch the weekly wrap here.
Yesterday, the ASX200 gained 38 points or 0.5%, which marked the fourth gain in the last five days. All sectors closed in the green, apart from the Energy and Consumer Staples sectors.
In the US, the Dow Jones surged to a new all-time high, the S&P500 notched its sixth straight day of gains, while the Nasdaq closed slightly lower.
Following the decent night on Wall Street, the futures are suggesting the Aussie share market will open 0.16% higher this morning.
What to watch today:
- There are several companies reporting today, they include Alumina (ASX:AWC), Brambles (ASX:BXB), Woodside Petroleum (ASX:WPL), Cimic Group (ASX:CIM), Megaport (ASX:MP1), Mirvac Group (ASX:MGR), and Rhipe (ASX:RHP).
- AGMs today include Wesfarmers (ASX:WES), likely to also provide a trading update at the event, Transurban (ASX:TCL), Crown Resorts (ASX:CWN), APA Group (ASX:APA), as well as Endeavour Group (ASX:EDV), Auckland International Airport (ASX:AIA) and Magellan Financial Group (ASX:MFG).
- The most traded stocks yesterday by Bell Direct clients included BHP (ASX:BHP) which traded slightly higher yesterday after the company managed to outbid Australian billionaire Andrew Forrest’s Wyloo Metals to buy Canadian nickel miner Noront Resources. The company’s chief executive stated that BHP’s offer delivers certainty of value to Noront shareholders via an all-cash offer. Another most traded stock was Whitehaven Coal (ASX:WHC). Its share price tumbled 7.9% yesterday after China’s state planner, the National Development and Reform Commission (NDRC) said that they were looking to clamp down on surging coal prices.
- The oil price continues to trade at 7-year high territory, lifting 1.1% to US$83.89 a barrel. This comes after US crude stockpiles fell and inventories at the nation’s largest storage site hit their lowest level in three years. The gold price is currently trading 0.7% higher at US$1,781 an ounce. And the sea borne iron ore price is trading slightly higher at US$123 a tonne.
Trading ideas:
- Bell Potter has reiterated its BUY recommendation on oil and gas exploration and production company, Beach Energy (ASX:BPT) with an increased price target of $1.65 (previously $1.62). BPT is currently trading down 20% YTD and yesterday closed 3.7% lower, which implies 14.6% share price growth.
- Bullish charting signals have been identified in Panoramic Resources (ASX:PAN), Airtasker (ASX:ART) and Bapcor (ASX:BAP), according to Trading Central.
US stocks travelled higher overnight, boosted by stronger than expected earnings.
This morning, the Aussie share market is set to open higher, with the futures suggesting a rise of 0.7%.
What to watch today:
- In company news, Atlas Arteria (ASX:ALX) reported a 9.7% jump in toll revenue in the quarter, as traffic is picking up.
- Gold stocks to watch include Evolution Mining (ASX:EVN) which reported higher than expected production in the quarter and OZ Minerals (ASX:OZL) which announced copper production is tracking in line with guidance, while it expected gold production to increase. The copper price is also trading at a record all-time high.
- Flight Centre (ASX:FLT) is set to hold its AGM today.
- The oil price hit a new 7-year high overnight at US$83, after rising 0.7% overnight and 30% in two months. Watch Australis Oil & Gas (ASX:ATS) and Global Energy Ventures (ASX:GEV). Also watch this week’s best performing energy stocks, including Beach Energy (ASX:BPT) which is up 3.5% and Whitehaven Coal (ASX:WHC) which is up approximately 2%.
Trading Ideas:
- The owner of Autobarn, Midas and Burson Autoparts, Bapcor (ASX:BAP) was reiterated as a Citi BUY stock with an increased 12-month target price of $8.75, implying 14% share price growth from yesterday’s close.
- Bullish charting signals have been seen in Imugene (ASX:IMU), Lake Resources (ASX:LKE) and Nearmap (ASX:NEA), according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a fall of 0.3%.
What to watch today:
- Stocks exposed to China will be a focus today, as Chinese industrial production and economic growth both slowed more than expected. Australian companies such as commodity giants BHP (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals (ASX:FMG), who export to China, would have noticed less commodity sales.
- In company news, BHP (ASX:BHP), Northern Star Resources (ASX:NST) and Stockland (ASX:SGP) are set to report quarterly numbers.
- BHP (ASX:BHP) announced the proposed merger of its Petroleum business with Woodside Petroleum (ASX:WPL) will likely go ahead in November 2021, creating a global top 10 energy company. Most analysts have BHP as a HOLD, except Macquarie who have BHP as a BUY with a 12-month price target of $56.
- Oil holds its new 7-year high at US$82.29, and the price of platinum has risen 2%. Watch Zimplans (ASX:ZMI), Challice Mining (ASX:CHN) and Podium Minerals (ASX:POD). Palladium is up almost 3%, so you could also watch CHN, Liontown Resources (ASX:LTR) and Impact Minerals (ASX:IPT).
Trading Ideas:
- Bell Potter reiterated Temple and Webster (ASX:TPW) as a HOLD with a 12-month price target of $12.75.
- Bullish charting signals have been identified in Mayne Pharma (ASX:MYX), Centaurus (ASX:CTM) and Emyria (ASX:EMD) according to Trading Central.
US equities rose on Friday and closed higher for the third straight week.
This morning, the Aussie share market is set to open higher, with the futures suggesting a rise of 0.4%.
What to watch today:
- Stocks that could benefit from the reopening of the economy will be in focus today, as vaccine certificates for international travel will be available from Tuesday ahead of the easing of international travel restrictions.
- Hard commodities such as metal and energy commodities are in the green, while soft commodities such as cotton, beef, poultry and hogs are lower.
- The oil price pushed higher to a new 7-year high, trading at US$82.28.
- Temple and Webster (ASX:TPW) provided an updated EBITDA in the first half of the year, due to a “strong tailwind of ongoing adoption of online shopping”, fuelled by structural shifts from COVID-19. TPW will be investing more into online marketing, with the goal of becoming the largest online retailer for furniture and homewares. TPW is a Bell Potter HOLD stock.
- In global economic news:
- Flash PMI surveys (performance indicators of the services and manufacturing industries) will be released this week for Australia, the US, the UK and the Eurozone.
- China’s central bank will decide this week if it will provide economic support.
- Also out this week: US housing data, UK retail data, Eurozone consumer confidence, and China’s third quarter GDP.
- Australia’s service sector data for October will be released on Friday.
Trading Ideas:
- Bell Potter reiterated Eagers Automotive (ASX:APE) as a BUY stock with a price target of $18.75, implying 28% share price growth in a year.
- Bullish charting signals have been identified in Breaker Resources (ASX:BRB), Rumble Resources (ASX:RTR) and Challenger Exploration (ASX:CEL) according to Trading Central.
The Aussie share market flatlined on a weekly basis, as unemployment data rocked the boat, meanwhile on the positive side, business confidence and new home sales rose.
In Jess' final weekly wrap, she covers:
- (0:37) Financials hit the most after Aussie economy loses more jobs than expected
- (1:21) Fintech investment platforms stealing the show after reporting record flows
- (3:45) Why there's an increased appetite for infant formula stocks
- (5:57) US third quarter earnings reports ramping up - what to expect
- (6:47) Why next week's Services sector preview will be one to watch
Watch the Weekly Wrap in video here.
Yesterday, the ASX200 posted its first gain for the week as Tech shares rallied.
In the US, all three benchmarks closed in the green, with the Dow rallying over 500 points, the S&P500 lifting 74 points and the Nasdaq up 250 points. Better-than-expected earnings reports were released from three major banks, as well as Walgreens and UnitedHealth. Also adding to the positive market sentiment was a lower-than-anticipated number of weekly jobless claims.
Following the broad rally on Wall Street, the recovery in megatechs and the advance of base metals, oil, and gold; the futures are suggesting the Aussie share market will open 0.64% higher this morning.
What to watch today:
- In economic data, yesterday, the unemployment rate worsened from 4.5% to 4.6%. This was better than the 4.7% forecast. A total of 138,000 lost their jobs, while monthly hours worked increased by 15 million hours.
- Today, keep watch of BHP (ASX:BHP) and Rio Tinto (ASX:RIO) after its US listed shares jumped in line with commodities. BHP was up 3.9% and RIO gained 3.2%. RIO is also set to release its quarter report today.
- Companies going ex-dividend today include Harvey Norman Holdings (ASX:HVN) and Rhipe (ASX:RHP). While, Treasury Wine Estates (ASX:TWE) and BNPL stock Splitit (ASX:SPT) hold their AGMs today.
- The most traded stocks by Bell Direct clients yesterday, they included Strickland Metals (ASX:STK) which rose over 23% yesterday after the company discovered a high-grade zinc-lead at its Iroquois prospect in WA. Another most traded stock was a2Milk (ASX:A2M) which rose 4% yesterday. The catalyst behind A2M’s rise has been the release of one of its smaller rivals Bubs Australia’s (ASX:BUB) first quarter update.
- The oil price continues to trade at 7-year high territory, lifting 1% to US$81.49 a barrel. This comes after top oil producer Saudi Arabia dismissed calls for additional OPEC supply and the International Energy Agency stated that rising natural gas prices could boost demand for oil.
- The gold price also traded higher, rising to a one-month high. A dip in the US dollar and bond yields led to investors turning to bullion as an inflation hedge. The uranium price jumped above US$48 a pound, moving closer to its 9-year high hit last month. And the seaborne iron ore price traded slightly higher at $US122 a tonne.
Trading ideas:
- Bell Potter has initiated coverage on hardware company, Coventry Group (ASX:CYG) with a BUY recommendation on the stock and a $1.90 price target.
- Bullish charting signals have been identified in Ioneer (ASX:INR), IDT Australia (ASX:IDT) and Hastings Technology Metals (ASX:HAS), according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a rise of 0.3%, with a focus on tech and growth stocks as bond yields have slightly fallen.
What to watch today:
- In economic news, employment data for September will be released at 11:30am AEDT. The market expects unemployment to worsen from 4.5% to 4.7%, and 100,000 jobs to be lost.
- The iron ore price has fallen 3.7% to US$124.17 after one of China’s biggest property developers missed a bond coupon payment. Expect BHP (ASX:BHP), Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG) and other iron ore players to lose traction today.
- Oil holds a 7-year high at US$80.61 a barrel, while the price of lithium carbonate nears its record all time high. And coal is getting closer to its all time high as flooding in China is causing further supply concerns.
- Soft commodities are rallying including cotton, beef, poultry and hogs.
- Whitehaven Coal (ASX:WHC) is set to report and Redbubble (ASX:RBL) will provide a trading update today.
Trading Ideas:
- Bubs Australia (ASX:BUB) was upgraded by Bell Potter from a HOLD to a BUY, with an increased price target of $0.65, implying 30% share price growth in a year. Meanwhile, Citi has BUB as a HOLD. Bubs Australia (ASX:BUB) shares rose 38% after reporting a 96% jump in revenue year on year, to $19 million. Bubs Infant Formula’s gross revenue increased over 120% year on year. Similarly, Adult Goat Milk Power’s gross revenue grew 100% on the prior year. This is due to China’s sales rising 156% year on year and contributing 53% to quarterly gross revenue.
- Resolute Mining (ASX:RSG), Calidus Resources (ASX:CAI) and Electro Optic Systems (ASX:EOS) according to Trading Central.
The Aussie share market is set to rise 0.2% and possibly erase yesterday’s fall of 0.26%.
What to watch today:
- The price of coal edged back closer to its record and nickel hit a one month high, while aluminium hit a 13-year high. Stocks to watch include coal companies Whitehaven Coal (ASX:WHC), Coronado (ASX:CRN), and New Hope (ASX:NHC), nickel stocks Western Areas (ASX:WSA), and Nickel Mines (ASX:NIC), and aluminium stocks Alumina (ASX:AWC), South32 (ASX:S32) and Rio Tinto (ASX:RIO).
- The iron ore price in China fell 4.5% to US$129 and oil set a new 7-year high rising over US$80 a barrel after jumping 1.5%.
- Commonwealth Bank (ASX:CBA) and Southern Cross Media (ASX:SXL) hold their AGMs today.
- Gowing Bros (ASX:GOW) goes ex-dividend today and EQUINOX (ASX:EQN) is due to list today.
Trading Ideas:
- Bell Potter reiterated their BUY rating on Life360 (ASX:360) with a $10.75 price target, implying 23% share price growth in a year.
- Citi downgraded Zip (ASX:Z1P) from a BUY to a HOLD on the back of lower customer growth in the US and has decreased its price target to $7.40.
- Bullish charting signals have been identified in Splitit (ASX:SPT), Damstra (ASX:DTC) and CleanSpace Holdings (ASX:CSX), according to Trading Central.
Rising bond yields and stagflation fears weighed down on the market yesterday and the ASX200 closed in the red.
In New York overnight, all three major indices closed lower, amid rising oil prices and economic worries.
Following US equities, the SPI futures are suggesting the ASX200 will fall 0.3% at the open this morning.
What to watch today:
- In economic news, business confidence data for September will be released at 10:30am AEDT. The business confidence index rose to -5 in August from -7 in July. Forecasts expect the index to rise to -2 in September. Confidence has been improving in transport, finance, business and property, while remaining weak in construction, mining and retail.
- Keep watch of petroleum company Ampol (ASX:ALD). The company will acquire all of Z Energy shares (ASX:ZEL) for NZ$3.78 cash per share. This is a $1.9 billion acquisition that looks to fast track a transition to electric vehicles. ZEL rose 5.9% yesterday, while ALD rose 2.9%.
- One of the most traded stocks by Bell Direct clients yesterday was Star Entertainment (ASX:SGR). Its share price tumbled 22.9%, amid suspected money laundering, fraud and organised crime at its casinos. Bell Direct and advised clients were also trading BHP (ASX:BHP) and Fortescue Metals (ASX:FMG), after the iron ore price jumped as Chinese markets returned from national holidays. FMG, which is currently a Bell Potter BUY, has also just announced its plans to build a hydrogen-equipment factory in Gladstone in Central Queensland.
- Reece (ASX:REH) is set to go ex-dividend today.
- The oil price continues to trade higher, above US$80. Crude oil futures rose to a record high US$82.14 a barrel.
- Spot gold is trading steady, while copper is higher. While the seaborne iron ore price has jumped more than 6%, trading at US$130.24 a tonne.
Trading ideas:
- Bell Potter maintain their BUY rating on Imdex (ASX:IMD), after a positive first quarter trading update. They have increased their price target from $2.85 to $3.00, with a strong outlook for FY22 revenue growth and margin expansion.
- Bullish charting signals have been identified in Firefinch (ASX:FFX), De Grey Mining (ASX:DEG) and KGL Resources (ASX:KGL), according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.1%.
What to watch today:
- Oil stocks were some of the best performers in the US and the same may occur on the ASX. The oil price rose to US$80 a barrel for the first time since 2014, as oil demand rebounds and supply remains low. The oil price has gained 60% this year and the market expects tight supply to remain for 6 months.
- The iron ore price rose 5.4% to US$123.30 in China. This helped BHP in New York rise over 1%. Expect iron ore stocks like BHP (ASX:BHP), Fortescue Metals (ASX:FMG), Rio Tinto (ASX:RIO) and Mineral Resources (ASX:MIN) to follow.
- Travel, tourism and food and beverage stocks are on watch ahead of NSW reopening its economy. Keep your eye on Australia’s biggest pub owner Charter Hall (ASX:CLW), as well as travel stocks that will likely see increased bookings.
- In economic news, employment data will be released on Thursday for September.
- Companies going ex-dividend today include Qualitas Real Estate Income Fund (ASX:QRI). RECHARGE FPO (ASX:REC) is due to list today.
Trading Idea:
- Bell Potter reiterated its BUY rating on Mineral Resources (ASX:MIN), however slashed its price targe to $54.25 (previously $61.85), accounting for the drop in iron ore prices.
- Bullish charting signals have been seen in Vimy Resources (ASX:VMY), Westgold Resources (ASX:WGX) and Calix (ASX:CXL) according to Trading Central.
It was a bit of a topsy-turvy week for the Aussie share market. However, the market looks set to close higher on a weekly basis for the first time in five-weeks, fuelled by gains in the Energy & Financial sectors.
In this week’s wrap, Jessica covers:
- (0:52) The best performing stocks this week
- (1:15) Two key reasons why investors are moving into gold
- (3:13) Why October is traditionally one of the best performing months for stocks
- (4:21) The ten most traded stocks by Bell Direct clients this week
- (4:52) Why next week's employment data will be watched like a hawk
Watch the Weekly Wrap in video here.
Please note: The weekly wrap text was written at the close of trade Thursday 7 October.
Yesterday, the ASX200 gained 0.7% following a better night of trade on Wall Street, with the big banks and Woolworths notching up gains of 1%. Nearly all sectors closed in the green, with tech shares rallying. The only sector to fall was the Energy sector, as the US said it was considering selling oil from its strategic reserves and Russia said it was ready to stabilise the natural gas market.
Looking to the US, lawmakers reached a deal on Thursday to increase the debt ceiling in the short-term. The compromise will avoid an unprecendented debt default for now. This helped equities rally, with the Dow rising 300 points, the S&P500 closing 0.8% higher, and the tech-heavy Nasdaq up 1.1%.
Following a positive session on Wall Street, the futures are suggesting the Aussie share market will open 0.46% higher this morning, with the market on track to finish higher for the first time in five weeks.
What to watch today:
- Continue to keep watch of travel and tourism, as well as food and beverage stocks as from Monday the 11th of October, fully vaccinated adults in NSW will enjoy more freedoms as several restrictions are eased as part of the reopening roadmap.
- In economic news, yesterday, the services sector reading for September edged up 0.1 points to 45.7 from 45.6 in August, which points to the second consecutive month of contraction in the services sector. Today, investors will digest the latest building permits data for August, and the RBA will release its semi-annual Financial Stability Review, with talks that lending and housing are likely to feature prominently.
- Companies that are paying their latest dividends include Healius (ASX:HLS), Reliance Worldwide Corporation (ASX:RWC), WiseTech Global (ASX:WTC) and Woolworths (ASX:WOW).
- The most traded stocks by Bell Direct clients yesterday included Whitehaven Coal (ASX:WTC), its shares fell 7% following the ongoing energy crisis that saw global coal futures tumble yesterday. Another most traded stock was Red 5 (ASX:RED). The gold stock charged about 18% yesterday as the business made further headway at is cornerstone King of the Hills (KOTH) project, where construction is underway on one of Australia’s most well-endowed gold assets.
- The oil price resumed its rally, lifting 1.1% higher to US$78.84 a barrel, now trading back at 7-year high territory. This comes as the market deemed it unlikely that the US would release emergency crude reserves or ban exports to ease tight supplies.
- The gold price fell following a drop in US weekly initial jobless claims, which boosted treasury yields. Meanwhile, the seaborne iron ore price traded slightly higher, at $118.
Trading ideas:
- Bell Potter has reiterated its BUY recommendation on software company, Envirosuite (ASX:EVS) with an increased price target of $0.22 (previously $0.20). EVS closed higher yesterday, up about 16% to $0.18, which implies about 19% share price growth.
- Bullish charting signals have been identified in Red 5 (ASX:RED), Lynas Rare Earths (ASX:LYC) and Piedmont Lithium (ASX:PLL) according to Trading Central.
Yesterday, the ASX200 fell 0.6% after the Reserve Bank of New Zealand increased its interest rates, which affected sentiment on the ASX, making investors questions if the RBA would do the same.
Today, the Aussie share market is set to open higher, with the futures suggesting a rise of 0.5%.
What to watch today:
- The oil price fell 2.5% to US$76.92, falling from a 7-year high. Oil prices have surged over 50% this year, adding to inflationary pressures. Iron ore prices remained relatively flat overnight on limited market activity. And thermal coal prices fell 10% from their record high.
- Watch travel, tourism and food and beverage stocks ahead of NSW reopening next week.
- In economic news, there will be a services sector reading today for September.
- Companies going ex-dividend today include ARB Corp (ASX:ARB) and Macmahon Holdings (ASX:MAH).
Trading Ideas:
- Citi reiterated its BUY rating for ship builder Austral Limited (ASX:ASB) with a $3.10 price target, implying 61% share price growth in a year.
- Bullish charting signals have been seen in QBE Insurance (ASX:QBE), hipages Group (ASX:HPG) and Praemium (ASX:PPS) according to Trading Central
The major US indices rebounded in the US overnight, led by investors buying the dip into tech stocks.
There is near term uncertainty in the market, as the world awaits the fate of China’s biggest property developer Evergrande, currently in a trading halt. Fantasia, another large Chinese developer, also missed a repayment. Therefore, iron ore demand is likely to slow down even further.
The Aussie share market is set to open higher, with the futures suggesting a rise of 0.5%, with a focus on tech and oil stocks.
What to watch today:
- The oil price rose to US$78.93, its highest level since 2014. Oil prices have surged over 50% this year, adding to inflationary pressures.
- Uranium is trading higher as the International Atomic Energy Agency expects world nuclear-generating capacity to double by 2050, as the world aims to move away from fossil fuels to fight climate change. Keep you eye on Paladin (ASX:PDN) and Deep Yellow (ASX:DYL). Also keep in mind four uranium companies with licences to mine in South Australia. These include Alliance Resources (ASX:AGS), Boss Energy (ASX:BOE), BHP (ASX:BHP), as well as Energy Resources (ASX:ERA), one of the longest operating uranium producers, which is majority owned (86%) by Rio Tinto (ASX:RIO).
- In economic news, yesterday Australia’s balance of trade data hit a record all time high, while iron ore sales to China were lower than expected in August compared to July. In addition, yesterday the RBA reconfirmed it will continue to buy bonds to support the economy until February next year.
Trading Ideas:
- Citi reiterated its BUY rating for baby retailer Baby Bunting (ASX:BBN) and has increased its price target to $6.11, implying 13% share price growth in a year. Baby Bunting’s AGM revealed sales momentum has accelerated, following the last trading update. Citi expects further acceleration in sales throughout the rest of this year as lockdowns end. The company is also making faster than expected progress on its private label strategy, resulting in gross margins being better than expected to date.
- Bullish charting signals have been seen in Silver Lake Resources (ASX:SLR), Kalium Lakes (ASX:KLL) and Teaminvest Private Group (ASX:TIP), according to Trading Central.
US stocks started their trading week in the red, with concerns about rising long- term interest rates.
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.9%.
What to watch today:
- In economic news, business confidence for September will be released, and the RBA will hold its monthly meeting. Interest rates are tipped to remain on hold until next year, however the market will be focusing on the RBA reconfirming that it will continue to buy bonds until February.
- The oil price rose 2.3% to US$77.62, a 7-year high, despite OPEC saying they will increase oil output in November.
- The iron ore price is steady at US$117. The focus for iron ore investors will be China’s biggest property developer, Evergrande.
- Companies going ex-dividend today include Sims (ASX:SGM), Perenti Global (ASX:PRN) and BWX (ASX:BWX).
Trading Ideas:
- Bell Potter reiterated Bega Cheese (ASX:BGA) as a BUY stock, with a price target of $6.35, implying 19% share price growth in a year.
- Bullish charting signals have been identified in The a2 Milk Company (ASX:A2M), Mayne Pharma (ASX:MYX) and Rumble Resource (ASX:RTR), according to Trading Central.
Friday’s sell off saw Australian shares close 2% lower. It was the 4th straight week of declines. Banking stocks were the worst performers. All four major banks tumbled, with Commonwealth Bank (ASX:CBA) down the most. Mining stocks also fell, while travel stocks were higher after Prime Minister Scott Morrison announced international borders will open in November.
European stocks closed in the red on Friday after economic data released showed euro zone inflation hit a 13-year high. Inflation rose 3.4% in September, the highest reading since September 2008. The Stoxx 600 closed 0.4% lower.
There was a broad rebound in New York. All three major benchmarks advanced, following a surge in US consumer spending data for August. The Dow gained 480 points, the S&P 500 rose nearly 1.2% and the Nasdaq gained 0.8%. The 10-year Treasury yield fell on Friday, back below 1.5%.
Following US equities, the SPI futures are suggesting the ASX200 will open 0.7% higher.
What to watch today,
- Take note that October is historically another volatile month.
- BSA Limited (ASX:BSA) goes ex-dividend today.
- Some of the most traded stocks on Friday by Bell Direct clients were Fortescue Metals (ASX:FMG) and Mineral Resources (ASX:MIN), as mining stocks all dropped. FMG fell 2.6% on Friday and was one of the ASX200’s worst performers in September, falling over 20% the past month, with the drop in iron ore prices. FMG is a Bell Potter BUY. MIN fell 6.9% on Friday, that is a Citi BUY.
- In economic news, housing data released on Friday saw property prices are still rising, up 1.5% in September and have jumped 20% over the year. Economic updates in the week ahead will include Balance of Trade data for August and the RBA’s interest rate decision released tomorrow and Building Permits out on Friday.
- The oil price has lifted 1.1% and is trading above US$75, supported by tight supply and high demand ahead of OPEC’s meeting next week.
- Gold is trading higher, with a strong dollar, rising bond yields, as well as expectations that the US Fed will pull back on bond-buying in November.
- The coal price continues to rise, amid the tight supply in China, while the seaborne iron ore price is trading 3.6% lower at US$115 per tonne.
Trading Ideas:
- Bell Potter have upgraded Uniti Group (ASX:UWL) from a HOLD to a BUY. Their 12-month price target remains unchanged at $4.50, where the total expected return is over 15%. Bell Potter views the recent pull back in UWL’s share price as a buying opportunity and forecast continued strong growth. UWL closed lower on Friday at $3.82, implying 17.8% share price growth in a year.
- Bullish charting signals have been identified in Imdex (ASX:IMD), Cynata Therapeutics (ASX:CYP) and Elsight (ASX:ELS) according to Trading Central.
With a somewhat bitter September behind us, we move into October, a month where markets historically rebound 0.9% on average. However, there's still a lot of short-term uncertainty globally, so what's ahead for equities?
In this week’s wrap, Jessica covers:
- (1:15) Why Tech shares fell to a four-month low
- (1:53) Beach Energy (ASX:BPT) rising 26% as the oil price charges higher
- (3:23) What to consider given investment banks believe markets could fall further
- (4:47) The divided opinion on Fortescue Metals Group (ASX:FMG)
- (6:17) Key economic news out next Tuesday
Watch the Weekly Wrap in video here.
It was a positive day for Aussie shares yesterday with a broad rally in the final session of the quarter. The market rebounded with all 11 sectors closing higher.
European stocks wrapped up September in negative territory, however the STOXX 600 closed slightly higher, up 0.2%.
US equities dropped overnight, with the S&P500 wrapping up its worst month since March 2020. This was amid rising rates, inflation fears, COVID-19, and concerns of the Chinese property market.
Today, following shares falling in New York, the SPI futures are suggesting the ASX200 will fall 1.6% at the open.
What to watch today:
- In economic news, the Markit Manufacturing PMI for September will be released at 9am AEST. Forecasts expect it to rise from 52 to 57.3. Home Loan data for August will also be released today at 10:30am AEST.
- Over 60 stocks and ETFs are set to go ex-dividend today. This often sees shares fall and investors take their profits.
- The most traded stocks by Bell Direct clients yesterday included CSL (ASX:CSL), after falling almost 6% this week, but closing in the green yesterday. CSL is currently a Morgans BUY. Fortescue Metals (ASX:FMG) was another most traded stock, rising higher amid higher iron ore prices as Chinese steel mills stocked inventories before their national public holiday. However, Chinese iron ore demand remains constrained. And if you hold FMG, keep watch of it today – the company has suspended operations at its iron ore mine in Pilbara in WA, after an employee has tragically died in a ground collapse. FMG is currently a Bell Potter BUY.
- The oil price has risen almost 0.5%, trading just above US$75 a barrel. Gold is trading higher, while lithium has fallen heavily.
- The coal price has surged to a record high of $212 per metric, amid tight supply in China as they aim for carbon neutrality and the seaborne iron ore price is trading slightly lower at US$119.65.
Trading ideas:
- Bell Potter maintain their BUY rating on Coronado Global Resources (ASX:CRN), and have increased their price target from $1.20 to $1.40. Strong met coal prices and improving operational performance has flowed through to cash flow. CRN closed yesterday at $1.29, implying 8.5% share price growth in a year.
- Citi has upgraded JB Hi-Fi (ASX:JBH) to a BUY after positive share price performance. Citi pulled back its price target on JBH to $53 (previously $55), with an expected share price return of 19.9%.
- Bullish charting signals have been identified in Resolute Mining (ASX:RSG), Orica (ASX:ORI) and Crown Resorts (ASX:CWN), according to Trading Central.
The ASX200 extended its poor performance yesterday, falling about 1%. This dragged the market to a four-month low. Rising bond yields and a fall in the iron ore price put pressure on all sectors, with tech stocks taking the biggest hit.
The market was mixed in the US. The Dow Jones managed to add 90 points, the S&P500 slightly rose 0.16%, while the tech heavy Nasdaq came under pressure, falling 0.24%, following the volatile 10-year Treasury yield. The House on Wednesday passed a bill to suspend the US debt ceiling as the US heads towards a first-ever default with no clear solution in sight.
Following the mixed session on Wall Street, the futures are suggesting the Aussie share market will open 0.32% higher this morning.
What to watch today:
- In economic news, building permits will be released today. Consensus expects total dwellings approved in Australia to decline 5%, after the 8.6% drop in the prior month.
- Companies that are paying their latest dividends include Bendigo and Australia Bank (ASX:BEN), CSL (ASX:CSL), Fortescue Metals Group (ASX:FMG), Newcrest Mining (ASX:NCM) and Ramsay Health Care (ASX:RHC). Separately, Westgold Resources (ASX:WGX) goes ex-dividend today.
- The most traded stocks by Bell Direct clients yesterday included Mineral Resources (ASX:MIN). Its shares fell 5.6% yesterday following the decline in the iron ore price, which is driven by power outages in China and lingering concerns over Evergrande’s default. Other highly traded stocks included ANZ (ASX:ANZ), Tabcorp (ASX:TAH), Regis Resources (ASX:RRL) and Brambles (ASX:BXB).
- The oil price edged lower on Wednesday to about US$75 a barrel. This comes as US crude inventories rose more than expected, despite OPEC planning to maintain its deliberate approach to adding supply to the market despite strong worldwide demand.
- The uranium price rose 5%, while on the flip side, the lithium price fell 5%. Meanwhile, the gold price fell following the dollar rising and due to the growing confidence that the Fed will soon begin winding down its economic support measures.
Trading ideas:
- Bell Potter has rated iron ore exploration and development company Genmin (ASX:GEN) as a Speculative BUY, with a price target of $0.44. GEN closed yesterday at $0.17, which implies about 159% share price growth.
- Bullish charting signals have been identified in Insurance Australia Group (ASX:IAG), Resolute Mining (ASX:RSG) and Perseus Mining (ASX:PRU) according to Trading Central.
The US 10-year bond yield continued to climb overnight, hitting 1.5%, its highest level since June. As a result, an interest rate sell off was reignited.
The Aussie share market is set to open lower, with the futures suggesting a fall of 1.1%.
What to watch today:
- Keep an eye on retail stocks, after data released yesterday saw retail sales in August fell 1.7%. In addition, the Federal Government announced it will stop the $750 per week payments, once the country reaches 80% double dose vaccinations.
- Also keep a look out for long-term potential buying opportunities in clean energy and lithium stocks, as the NSW Government has committed to reducing emissions by 50% by 2030.
- The oil price fell 0.2% overnight to US$75.29, nearing October 2018 levels, amid restricted supply. Meanwhile, the coal price rose to a brand new record high overnight, taking its monthly gain to 20%. This is again amid tighter supply as China cut back on coal production in a bid to be carbon neutral by 2060.
- There are over 40 listed stocks and ETFs going ex-dividend today, transferring dividend rights to shareholders, which often causes shares to fall amid profit taking. Companies going ex-dividend today include: TPG Telcom (ASX:TPG), Centuria Industrial REIT (ASX:CIP), and Charter Hall (ASX:CLW), as well as ETFs including the ASX200 ETF (ASX:STW) and fixed income ETFs Australian Bond (ASX:BOND) and Australian Government Bond (ASX:GOVT).
Trading Ideas:
- Bell Potter have increased its price target on oil producer Beach Energy, (ASX:BPT) from $1.60 to $1.62, implying 19% share price growth in a year. Yesterday BPT upgraded its production by 13%, and Bell Potter believes the company has a strong, fully funded energy production growth outlook, while production growth is diversified across five energy basins and four separate gas markets, including global LNG trade.
- Bullish charting signals have been seen in Aeris Resources (ASX:AIS), Gale Pacific (ASX:GAP), and Ambertech (ASX:AMO), according to Trading Central
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.6%.
What to watch today:
- The oil price rose for the fifth day, up 1.5% overnight to US$75.45, its highest level since July, amid supply concerns. Oil stocks will be on watch today.
- The iron ore price in China rebounded 7.2% to US$119.31, supporting New York listed BHP and Rio Tinto, which rose 1% overnight. Expect ASX listed versions and other iron ore stocks to do well today.
- Lithium stocks will also be on the radar today after Ford announced it’s going to spend $11.4 billion on creating two new lithium-ion battery plants, that will produce electric vehicles and batteries. The plants are to be built in Kentucky and Tennessee. Ford is building the twin lithium battery plants though a joint venture with South-Korean based SK Innovation.
- In corporate news, Beach Energy (ASX:BPT) provided an investor update, announcing it will increase production to 28 million barrels of oil equivalent by financial year 2024. That’s a 13% compound annual growth rate. In addition, Beach Energy affirmed it’s on track to cut its carbon emissions by 25% from 2018 to 2025, with plans to be net zero emissions by 2050
- In economic news, retail sales data for August is set to be released today at 11.30am. Sales fell 2.7% and are expected to fall again. Keep an eye on retailers, especially those impacted by import bottlenecks like Accent (ASX:AX1).
Trading Ideas:
- UBS has a BUY rating on fertilizer business Incitect Pivot (ASX:IPL) and has increased IPL’s price target to $2.15.
- Bullish charting signals have been seen in Carnarvon (ASX:CVN), Kalium Lakes (ASX:KLL), and Starpharma (ASX:SPL) according to Trading Central
The SPI futures are suggesting a flat start to the week for the Aussie share market. On Friday, the ASX200 fell 0.4% and lost 0.8% on the week, falling for the 3rd straight week.
What to watch today:
- Watch iron ore stocks amid worry of China’s Evergrande, retail stocks amid supply-chain issues, and financial stocks given end of quarter profit taking.
- The oil price rose 3% to US$74.43, to an eight week high. The gold price rose slightly, while the iron ore price slowly bounced off its low, trading at US$120, after falling below US$100 last week. However, iron ore last traded lower on Friday. As a result of this, New York listed BHP and Rio Tinto closed in the red.
- In corporate news, Synlait Milk (ASX:SM1) forecasts a return to robust profitability. The company says it will return to pre-pandemic levels of profitability by the end of its 2023 financial year. SMI, the milk powder producer, reported a loss of $20 million for its financial year ended July 31, due to disruptions brought on by the pandemic and from its key customer A2 Milk. However, for this current year results will be bolstered as production is ramping up for the new multinational customer and normal business conditions should return.
- Companies going ex-dividend today include Imdex (ASX:IMD) and Gold Road Resources (ASX:GOR).
- In economic news, retail sales data will be released on Tuesday and building permit data will be released on Thursday.
Trading Ideas:
- Citi expects Accent’s (ASX:AX1) shares to fall amid supply chain disruptions. This is partially due to Nike downgrading its 2022 outlook, as freight and supply issues mean the company can’t keep up with strong demand. Citi believe shares in the shoe store giant, Accent with fall to $2.14, however it is expected to maintain a dividend yield of 3.7%.
- Bullish charting signals have been seen in Exopharm (ASX:EX1), Orthocell (ASX:OCC) and Catapula Group (ASX:CAT), according to Trading Central.
US and Aussie equities fell for the third straight week, rebounding slightly over the last few sessions, as China's biggest property developer coughed up its repayments. Additionally, US and Australian central banks have affirmed economic stimulus will be tapered next year.
In this week’s wrap, Jessica covers:
- (0:42) What’s in store for interest rates
- (2:02) AusNet Services (ASX:AST) rising 30% amid takeover fight
- (2:25) Travel stocks reaping the benefits of increased vaccination rates & borders reopening
- (2:52) Why iron ore stocks are rebounding
- (6:07) Five stocks that Bell Direct clients are seeing value in
Watch the Weekly Wrap in video here.
In overseas markets, the Bank of England and the US Fed kept monetary policy unchanged. European stocks closed higher, with the STOXX 600 index closing 0.9% higher. And all three major US indices closed in the green.
Following the broad gains in European and US markets, the SPI futures are suggesting the ASX200 will open 0.11% higher.
What to watch today:
- Companies going ex-dividend today include Atlas Arteria (ASX:ALX), Bank South Pacific (ASX:BFL) and Sigma Healthcare (ASX:SIG).
- The most traded stocks yesterday by both Bell Direct and our advised clients. They were BHP (ASX:BHP) and Fortescue Metals (ASX:FMG), after the iron ore price rebounded. The aftermath of Chinese developer Evergrande securing a deal to avoid default caused a spike in iron ore demand.
- The iron ore price pushed above US$100, after this week hitting its 2021 year low. The bulk commodity increased 16.8% yesterday. The iron ore price is now trading 0.2% lower at the time of recording. Global steel output also declined.
- The gold price has plunged more than 1% to US$1,745 an ounce, and the oil price gained 1.4% to US$73.30 a barrel, at its highest level since the beginning of August, boosted by growing fuel demand.
Trading ideas:
- Bell Potter have upgraded their rating on Premier Investments (ASX:PMV) from a HOLD to a BUY, and have increased their 12-month price target to $31.25 (previously $26.10). The investment company delivered strong full year 2021 results, despite the impact of the lockdowns. PMV closed at $27.63 yesterday, implying 13.1% share price growth in a year.
- Bullish charting signals have been identified in PointsBet Holdings (ASX:PBH), Charter Hall Group (ASX:CHC) and Omni Bridgeway (ASX:OBL), according to Trading Central.
Evergrande Group, China’s second biggest property developer, managed to rack up staggering debts of more than $432 billion dollars, on the brink of collapse. However, at the very last minute managed to ink a deal to keep it afloat. News of this deal helped the iron ore price surge and Aussie materials stocks make steep gains, lifting the broader market by 0.32%.
In the US, all three benchmarks closed in the green. This comes after the Fed announced it was not ready to remove stimulus yet. While no specific timeline was provided as to when it may begin moderating its purchases, in the Fed’s post-meeting statement, they noted “if progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted.”
Following a strong night of trade on Wall Street, the futures are suggesting the Aussie share market will open 0.19% higher this morning.
What to watch today:
- In economic news, the Manufacturing PMI Flash data and the Services PMI Flash data will be released today at 9am AEST.
- Companies ex-dividend today include Eagers Automotive (ASX:APE), NRW Holdings (ASX:NWH), Cochlear (ASX:COH) and Genesis Energy (ASX:GNE).
- Suncorp Group (ASX:SUN) holds its AGM today and Brickworks (ASX:BKW) are set to report today.
- The most traded stocks by Bell Direct clients yesterday included Zip (ASX:Z1P). Its shares lifted 4.3% yesterday to $6.51 following investors responding positively to the company’s strategic US$50 million investment in India-based BNPL operator ZestMoney. ZestMoney was founded in 2015 and is now one of the largest and fastest growing BNPL platforms in India. Another highly traded stock yesterday by Bell Direct clients was Fortescue Metals (ASX:FMG). Its shares lifted 4.2% yesterday, bouncing off 14-month lows following the news that China’s embattled real estate developer Evergrande will meet its bond interest payments due today.
- The oil price climbed more than 2%, following a greater than expected drawdown of US supplies. The gold price fell after the Fed signalled a sooner than expected interest rate hike, while the palladium price lifted over 6%.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on iron ore company Fortescue Metals Group (ASX:FMG), however have decreased its price target to $20.87 (previously $22.52). At its current share price value of $15.37, this implies about 36% share price growth.
- Bullish charting signals have been identified in De Grey Mining (ASX:DEG), Aussie Broadband (ASX:ABB) & REA Group (ASX:REA), according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.2%.
The market is down 1.8% this week so far. Miners are down the most, while utilities and staples are up the most.
What to watch today:
- Investors are favouring utilities, staples and healthcare, amid uncertainty in the market. The market may stay this way until the outcome from the US Central Bank’s meeting on Wednesday, until investors have further clarity on China’s property sector demise, and until the roadmap out of lockdown becomes clearer.
- The iron ore price has fallen heavily, below US$100 for the first time in a year. However, overnight iron ore slightly rose 0.1% to US$93.03. BHP investors in New York took this as a sign to buy the dip. In the US, BHP shares rose almost 1%.
- The oil rice is steady at US$70.70, holding its highest level since August, while the gold price is slightly lower.
- In economic news, yesterday the RBA meeting minutes reaffirmed the RBA’s confidence that the Australian economic should see strong growth resume next year. Today, the RBA Governor and Deputy will appear at the House of Representatives at 10:15am AEST. And the RBA Assistant Governor of the Financial System will also give a speech on the housing market and financial stability at noon AEST.
- In corporate news, AGL Energy (ASX:AGL) is set to hold its AGM.
- Widgie Nickel (ASX:WIN) and X2M Connect (ASX:X2M) are new listings on the ASX.
- Abri (ASX:ABC) goes ex-dividend today and Hawkstone Mining (ASX:HWK) goes ex-bonus entitlement.
Trading Ideas:
- Citi has upgraded Champion Iron (ASX:CIA) from a HOLD to a BUY, however has slashed its 12-month price target from $7.25 to $6.40. Citi acknowledges near-term risk to iron ore price, forecasting iron ore to sit at US$125 in CY22 and hit US$80 in CY23. However, China’s lead indicators are stabilising and have turned up off recent lows. Citi says steel prices are being driven more by state imposed production cuts, than weakness in underlying demand.
- Bullish charting signals have been seen in Whitehaven Coal (ASX:WHC), Sydney Airport (ASX:SYD) and Alkane Resources (ASX:ALK), according to Trading Central
Investors are bracing for the US Central Bank meeting on Wednesday, with concerns the Fed will scale back stimulus.
There is worry China’s economy has reached its debt ceiling, as China’s biggest property developer is not able to pay its repayments. This is impacting Asian bank stocks and commodities.
The Aussie share market is set to open lower, with the futures suggesting a fall of 1.4%, following yesterday’s 2.1% drop. The market is 4% away from its August all time high.
What to watch today:
- The US will open its border to fully vaccinated foreigners, and analysts expect the most upside in financials and industrials.
- The iron ore price in China fell 8.8% to US$92.98. BHP and Rio Tinto listed in New York fell 2.9% as a result.
- Copper fell to a one-month low, while gold rose slightly, and the oil price fell 2%, however is recouping its losses and now trading at US$70.70, its highest level since August.
- In economic news, the RBA is set to release its meeting minutes at 11:30am AEST. The RBA announced earlier this month that stimulus will stop mid- February next year in line with the economic reopening.
- In corporate news, Sigma Healthcare (ASX:SIG) and Kathmandu (ASX:KMD) are due to make announcements today.
- Qube (ASX:QUB) goes ex-dividend today.
Trading Idea:
- Citi upgraded Baby Bunting Group (ASX:BBN) to a BUY, rising its 12 month price target from $5.90 to $5.98.
- Charter Hall (ASX:CLW) is a Citi BUY, given it’s set to buy ALE Property Group (ASX:LEP) for $1.68 billion. Citi cut its 12-month price target for CLW from $5.68 to $5.59.
- Pentant (ASX:5GG), Emvision Medical Devices (ASX:EMV) and Meridian Energy (ASX:MEZ) are all giving off bullish charting signals, according to Trading Central.
All eyes this week are on the US Federal Reserve, who will meet on Wednesday. The Fed are expected to hint when its $120 billion per month bond buying will slow down. This has been critical in supporting the US economy and stock market.
Ahead of the meeting, investors exercised caution, locking in profits and selling stocks, which dragged the Dow Jones to a two month low. Mining and tech stocks down the most, while energy stocks saw the biggest gains, as the oil price slicked up. Healthcare stocks also finished higher.
This morning the Aussie share market is set to follow the US, with the futures suggesting a fall of 0.92%.
What to watch today:
- The iron ore price fell on Friday, and has now risen 3.5% to US$123, as it attempts to rebound. Watch BHP (ASX:BHP) and Fortescue Metals (ASX:FMG).
- The lithium price rose 2%, while the oil price is now lower, rising 3% on the week to US$71.73, its highest level since July.
- The coal price hit another record high, amid restricted supply and skyrocketing demand from China and India for electricity.
- Corporate results from the US begin to come through as the end of the quarter approaches.
- Sydney Airport (ASX:SYD) reported August 2021 traffic numbers, with total passenger traffic of 51,000 passengers, down 99% on the corresponding period in 2019.
- Sigma Healthcare (ASX:SIG) and Kathmandu (ASX:KMD) are due to report tomorrow.
- Also this week: AGL Energy (ASX:AGL) set to hold its AGM on Wednesday. On Thursday, Brickworks (ASX:BKW) is set to report, and Suncorp (ASX:SUN) is set to hold its AGM.
- In economic news, the RBA meeting minutes will be released on Tuesday. And the services sector reading will be released on Thursday. Given restrictions, the sector is not expected to recover until November.
- Companies going ex-dividend today include Duratec (ASX:DUR) and Fenix Resources (ASX:FEX).
Trading Idea:
- Gold Road Resources (ASX:GOR) was reiterated as a Bell Potter BUY, with a $1.75 target, implying 31% share price growth in a year.
- Bullish charting signals have been identified in ALS (ASX:ALQ), Lovisa (ASX:LOV) and Imicor (ASX:IMR) according to Trading Central.
The Oil price hit a 7-week high this week supporting the market, however Friday's losses in early trading confirms we're still on shaky ground. Plus, Uranium stocks are in the spotlight as Australia is set to build nuclear powered submarines.
In this week’s wrap, Jessica covers:
- (0:33) Energy stocks charging as the Oil price jumps 5%
- (1:37) Why the market is bracing for further volatility this month
- (2:51) Pilbara Minerals (ASX:PLS) hitting an all-time high after selling lithium at a record price
- (4:19) Four Uranium stocks to watch
- (6:06) Four of the most traded stocks this week
- (6:47) Economic announcements to be across next week
Yesterday, the ASX200 lifted 0.6% despite mixed employment figures. The unemployment rate fell to a 12-year low of 4.5% in August, from 4.6% in July. The drop is believed to be attributed to the participation rate falling 2.4% as Australians gave up looking for work during lockdown and therefore weren’t counted as unemployed.
In the US, the market was mixed. We saw the Dow Jones & S&P500 down about 0.2%, while the Nasdaq was able to gain 0.1%. US investors digested mixed economic readings released on Thursday. August retail sales exceeded the market’s expectations and rose 0.7% from the month prior. Meanwhile, first-time jobless claims last week came in at 332,000, which was higher than the forecasted 320,000.
Following a mixed session overnight in the US, the Aussie share market is set to fall 0.24% if you go by the futures.
What to watch today:
- Australia’s new partnership with the US and UK will continue to be in focus today as countries and individuals voice their opinion on this strategic alliance. And the uranium price is now trading at a 9-year high, after lifting 8% to US$48.55. In the last month, the uranium price has lifted a huge 60% and yesterday, some ASX uranium stocks made big gains, including Deep Yellow (ASX:DYL), up 8% and 92 Energy, up nearly 9%.
- Companies going ex-dividend today include Carsales.com (ASX:CAR) and National Tyre & Wheel (ASX:NTD).
- The most traded stocks by Bell Direct clients yesterday, included Fortescue Metals (ASX:FMG). Its share price continued to come under pressure, falling 3.2% yesterday, as Chinese steel cuts speed up. Local lithium player, Ioneer (ASX:INR) was another highly traded stock at Bell Direct. INR shares fell 18% yesterday after the company announced a new joint venture with a multinational precious metal miner Sibanye Stillwater, with INR raising additional funds at a 70% higher price than when it undertook a capital raising via a placement in March. This further supports how red hot the lithium market is.
- The oil price remained steady after hitting that 7-week high yesterday. This comes as the threat to US Gulf crude production from Hurricane Nicholas receded. The gold price fell 2.2% driven by a rise in the US dollar, while the iron ore price continued to plunge, falling 3.4% to about US$120 a tonne.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on death care servicer Propel Funeral Partners (ASX:PFP) and has increased its price target by 9% to $4.65 (previously $4.25). PFP fell about 1% yesterday to $4.05, which implies about 15% share price growth.
- Bullish charting signals have been identified in Elixir Energy (ASX:EXR), James Hardie Industries (ASX:JHX) and Technology Metals Australia (ASX:TMT) according to Trading Central.
US stocks rebounded from prior losses, with energy stocks leading the gains after the oil price increased 3%. US stocks are 1.3% away from an all-time high.
Investors are bracing for further volatility, as it is the end of the quarter and options expire on September 17.
The Aussie share market is set to open higher, with the futures suggesting the market will rally 0.4%, and the focus on employment data ahead.
What to watch today:
- Unemployment data for August will be released today at 11:30am AEST. Unemployment is expected to grow from 4.6% to 4.9%. If the data is weaker, expect selling pressure. Watch banking and consumer spending stocks.
- Uranium stocks are in focus today. The US President, the Australian Prime Minister, and the UK Prime Minister, announced a new partnership with Australia, to build nuclear powered submarines. Historically, this is the first partnership of its nature. Prime Minister Scott Morrison said that the three nations will work together over the next 18 months, to determine the best path forward, to get the wheels into motion, and examine “nuclear stewardship responsibilities” in Australia. Therefore, uranium stocks to watch include Paladin (ASX:PDN), Deep Yellow (ASX:DYL), 92E Energy (ASX:92E), Devex Resources (ASX:DEV) and Energy Resources of Australia (ASX:ERA). Also watch ship builder Austal (ASX:ASB).
- Watch the lithium sector, after Australian produced lithium from Pilbara Minerals (ASX:PLS) was sold at a record amount.
- Oil stocks are in focus, as oil is trading at a 7-week high at US$72.65. Meanwhile, iron ore fell again, down 3% to US$122, after China’s construction investment fell 3.2% from January to August, and China’s steel output fell to a 17-month low in August after tightening property restrictions.
- Companies going ex-dividend today include Sky City, (ASX:SKC) and Spark NZ (ASX:SPK).
- The most traded stocks by Bell Direct clients yesterday included Metalhawk (ASX:MHK). MHK shares rose 13% and the day prior its shares rose 264%. Metalhawk is a gold and nickel explorer in Western Australia. Sayona Mining (ASX:SYA) was also a highly traded stock yesterday. SYA shares rose 13% as the lithium sector remains under the spotlight.
Trading Ideas:
- South32 (ASX:S32) was upgraded as a Citi BUY, with an increased target from $3.50 to $3.80, implying 13% share price growth in a year.
- Bullish charting signals have beenseen in Pilbara Minerals (ASX:PLS), Perseus Mining (ASX:PRU) and Challenger Exploration (ASX:CEL) according to Trading Central.
Overnight, the three major US indices closed lower.
Following Wall Street, the futures are suggesting the Aussie share market will fall 0.6% this morning, as investors adjust their portfolios ahead of the end of the quarter.
The Aussie share market is approximately 3% off a record high, with the market falling twice over the last 18 months. In September, companies go ex-dividend and investors sell stocks after collecting dividends.
What to watch today:
- At the end of the quarter, investors take profits from well performing stocks. Tech stocks are down the most this week, however the tech sector is one of the best performers this quarter. On the other hand, investors top-up on stocks that underperformed. Energy stocks this week are the best performers, up 5.7%, however energy is one of the worst performers this quarter.
- The lithium sector is in the spotlight as Pilbara Minerals (ASX:PLS) sold spodumene lithium at a record price.
- The oil price rose 0.4% to US$70.73, the gold price is steady above US$1,805, while the iron ore price fell again, down 1.5% to US$124. Some analysts believe the iron ore price will bottom at US$115. Additionally, the coal price is at a record high, and Goldman Sachs increased its price target for thermal and metallurgical coal.
- In economic news, yesterday business confidence improved, and today consumer confidence data will be released at 10:30am AEST. In addition, yesterday the RBA Governor said that the official cash rate won’t increase until 2024. However, corporate interest rates will rise after the RBA stop bond buying in February next year.
- Companies going ex-dividend today include: CIMIC (ASX:CIM), Costa Group Holdings (ASX:CGC), and Lovisa (ASX:LOV).
Trading Ideas:
- Agriculture and real estate business Elders Ltd (ASX:ELD) was reiterated as a Bell Potter BUY rating with a $13.75 target, implying 18% share price growth in a year.
- Bullish charting signals have been identified in Origin Energy (ASX:ORG), Pure Hydrogen (ASX:PH2) and Fletcher Building (ASX:FBU), according to Trading Central.
In overseas markets, European markets closed in the green after a week of losses, due to a strong economic recovery in the euro zone. US equities overnight closed mixed.
Yesterday the ASX200 recovered late, rising 0.25% at the close. Mining stocks pushed the market higher. The energy sector also benefited from the rising oil prices due to Hurricane Ida. And the four major banks closed mixed.
Today, following US equities, the SPI futures are suggesting the ASX200 will open 0.2% lower.
What to watch today:
- In economic news, Business Confidence data for August will be released today at 11:30am AEST. Business confidence fell to negative 8 points in July from 11 points in June. Forecasts expect August data to fall to negative 13, dragged down by lockdowns, in particular NSW currently. Additionally, the RBA Governor Phillip Lowe will give a speech at 1pm on Delta, the economy and monetary policy.
- Sydney Airport (ASX:SYD) following the company receiving a third takeover proposal from a consortium of IFM Investors. The offer is higher than the previous two SYD recently rejected, offering $8.75 cash per SYD share. The offer values Sydney Airport at $23.6 billion, and SYD closed 4.6% higher yesterday.
- Companies going ex-dividend today include: Absolute Equity (ASX:AEG), Breville (ASX:BRG), Glennon Small Companies (ASX:GC1), Newscorp (ASX:NWS), Inghams Group (ASX:ING), and PSC Insurance Group (ASX:PSI).
- The most traded stocks by Bell Direct clients yesterday included BHP (ASX:BHP), iShares S&P 500 ETF (ASX:IVV) and Computershare (ASX:CPU).
- The price of oil is trading 1.4% higher at US$70.68 a barrel. The gold price rose 0.3%, while copper fell over 2%. And iron ore is trading 2.6% lower at US$129.66 a tonne.
Trading ideas:
- Citi has a BUY rating on Ardent Leisure (ASX:ALG) with a $1.80 price target. ALG own and operate a leisure portfolio of over 100 assets across the US, Australia and NZ, such as Dream World and White-Water World. Citi’s expected share price return is 13.9%. ALG closed more than 5% lower yesterday.
- Bullish charting signals have been identified in Incitec Pivot (ASX:IPL), American Pacific Borates (ASX:ABR) and PropTech Group (ASX:PTG), according to Trading Central.
The major US indices closed lower on Friday and today, the futures are suggesting that the Aussie market will follow Wall Street and fall 0.4%.
What to watch today:
- The focus will be on travel and tourism stocks as the QLD and NSW border reopens.
- Monash Uni and CSIRO have developed a battery that can allow electric buses and trucks to travel from Melbourne to Sydney without recharging. The duo also said the innovation could be ready in a decade and also work in agricultural drones – with lithium batteries needing to be light weight. So keep an eye on lithium majors like Orocobre (ASX:ORE), Pilbara Minerals (ASX:PLS) and small cap stocks like Lake Resources (ASX:LKE) & Vulcan Energy Resources (ASX:VUL).
- The oil price rebounded 2% and rose 0.5% on the week.
- The nickel price hit a fresh 7-year high and gold went the other way, and fell below US$1,800 as the safe haven USD rose .
- The iron ore price fell again, losing 0.5% to US$133 a tonne – getting very close to where some analysts think the iron ore price will bottom at US$115 before slowly rebounding.
- Companies going ex-div today include: HUB24 (ASX:HUB), Healius (ASX:HLS), Chorus (ASX:CNU).
- Economic news this week includes business confidence on Tuesday, consumer confidence on Wednesday and employment data on Thursday.
Trading ideas:
- Bell Potter put out a banking note this morning reiterating BUY ratings for three of the big banks, calling CBA, ANZ and NAB a BUY, while WBC is a HOLD.
- Bell Potter maintained S2 Resources (ASX:S2R) as a Speculative BUY stock with $0.18 target, implying 84% share price growth in a year.
- Bullish charting signals have been identified in archTIS (ASX:AR9), Mach7 Technologies (ASX:M7T), and Viva Leisure (ASX:VVA), according to Trading Central
Historically the most negative month for both global and Aussie equities, this September was no different. The market pulled back 2% this week (Mon-Thu) with all sectors in the red.
In this week’s wrap, Jessica covers:
- (0:32) What's behind the plunging iron ore price
- (1:49) Technology One (ASX:TNE) rising 9% after being upgraded by analysts as a 'BUY'
- (4:13) Why it's worth exercising caution with UK exposed stocks
- (4:57) Three outlier stocks that rose over 20% after delivering on strategy
- (6:01) Four stocks Bell Direct customers are watching closely
- (6:48) Why all eyes will be on banks and travel & tourism stocks
Watch the Weekly Wrap in video here.
Wall Street extended its losses overnight, with all three major indices closing in the red. The S&P500 down 0.5%, the Dow Jones down 0.4% and the tech heavy Nasdaq down 0.3%.
Yesterday the ASX200 closed 1.9% lower, with equity sell offs across the market, after the NSW Government announced a roadmap out of lockdown.
Today, despite US equities falling, the SPI futures are suggesting the ASX200 will open 0.3% higher.
What to watch today:
- Consumer Inflation Expectations for September will be released this morning at 11am AEST. Inflation expectations deceased from 3.7% in July, to 3.3% in August. Forecasts expect it to fall to 3.2%.
- Companies going ex-dividend today include: Argo Global (ASX:ALI), Ariadne Australia (ASX:ARA), Base Resources (ASX:BSE), Cleanaway Waste Management (ASX:CWY), Sequoia Financial (ASX:SEQ) and WiseTech (ASC:WTC).
- The most traded stocks by Bell Direct clients yesterday included ANZ (ASX:ANZ), Flight Centre (ASX:FLT) and Fortescue Metals (ASX:FMG).
- The oil price has fallen 2.2% and is trading at US$67.80 a barrel, pressured by China’s decision to release crude oil reserves to the market, to lower domestic prices, stabilising domestic supply and demand.
- Copper is trading 0.5% lower and the iron ore price has fallen 1.3% and is trading at US$133.80 a tonne.
Trading ideas:
- Bell Potter maintain their BUY rating on Envirosuite (ASX:EVS), and have removed their Speculative rating. Bell Potter also increased their price target on EVS to $0.20, after the company’s positive development of a proof-of-concept contract they entered last week with Western Australia’s Water Corporation.
- Bullish charting signals have been identified in Viva Leisure (ASX:VVA), Pengana Private Equity Trust (ASX:PE1: and Omni Bridgeway (ASX:OBL), according to Trading Central.
On Wall Street, both the Dow Jones and S&P500 closed lower for the third straight session. The Nasdaq also fell 0.6% as tech shares like Facebook, Apple, Netflix, and Alphabet, all closed lower.
US investors will be watching the latest weekly jobless claims data, set to be released Thursday morning, which will give a greater look at the employment picture.
Following a negative session overnight in the US, the Aussie share market is set to follow suite, with a fall of 0.47% if you go by the futures.
What to watch today:
- In economic news, the ABS will publish its weekly payroll jobs and wages data for the fortnight to August 14, and RBA Deputy Governor, Guy Debelle will deliver an online address tonight at the Asian Securities Industry & Financial Markets Association Compliance Week conference.
- On the COVID-19 front, another half a million Pfizer vaccines have left the UK bound for Australia as part of a vaccine swap, set to arrive in less than one week since the deal was announced last Friday. The federal cabinet also discussed last night the changes required to lift Australia’s overseas travel ban as early as November, which should be announced in the next few days. Keep an eye on travel stocks like Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Webjet (ASX:WEB).
- Companies going ex-dividend today include Auswide (ASX:ABA), Monadelphous (ASX:MND), Nine Entertainment (ASX:NEC), Pro Medicus (ASX:PME), South32 (ASX:S32) and Vita Group (ASX:VTG).
- The most traded stocks by Bell Direct clients yesterday included Fortescue Metals (ASX:FMG), Zip (ASX:Z1P) and Flight Centre (ASX:FLT).
- The oil price climbed about 1%, following slow US output after Hurricane Ida. Producers in the Gulf are still struggling to restart operations nine days after Ida swept through the region.
- The gold price dipped to a two-week low as the dollar extended its gains, while the iron ore price continued to plunge, falling another 2.5% to US$135.56 a tonne.
- Uranium continues to trade at an 8 year high, lifting 3.5% to US$40.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on leading beauty and wellness company BWX (ASX:BWX) and has increased its price target by 7% to $6.10 (previously $5.70). BWX fell about 1% yesterday to $4.85, which implies about 26% share price growth.
- Bullish charting signals have been identified in Cobalt Blue (ASX:COB), Medlab Clinical (ASX:MDC) and K-TIG (ASX:KTG), according to Trading Central.
Wall Street returned from its public holiday long weekend, with US stocks beginning the week mostly in the red.
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.4%.
What to watch today:
- Australia’s vaccine passports will rollout from next month, as proof of vaccination status overseas. Upon return from travel, Australians will be allowed to home quarantine. Keep an eye on travel and tourism stocks such as Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Webjet (ASX:WEB).
- The aluminium price eased from its decade high, falling 0.2%. Watch Alumina (ASX:AWC), South32 (ASX:S32) and Rio Tinto (ASX:RIO).
- The iron ore price fell 4% to US$138.83. However, the technical indicators are suggesting that iron ore has been oversold. Although further selling pressure is expected in the short term, the technical indicators and the long term fundamentals, suggest iron ore could hit the bottom soon.
- The copper price fell 1.3%, while the oil price fell to a two week low at US$68.40, as Saudi Aramco cut its selling price by $1, on the back of new lockdowns across Asia.
- Companies going ex-dividend today include Adairs (ASX:ADH), Medibank (ASX:MPL) and Seek (ASX:SEK).
- One of the most traded stocks by Bell Direct clients yesterday was Mineral Resources (ASX:MIN), which fell approximately 4%. Yesterday MIN announced it sold all its major holdings in lithium stock Pilbara Minerals (ASX:PLS). MIN also has several Western Australia mining operations in iron ore and lithium. Bell Potter recommends MIN as a BUY with a price target of $54.70.
- In economic news, yesterday the RBA kept interest rates at 0.1% and extended its bond buying program. The RBA is set to buy $4 billion of bonds in a program ending 11th November. This program has now been extended until mid-February 2022. This means tech stocks will be attractive. This quarter, tech stocks have increased almost 10%. In addition, the RBA believes the Australian economy will bounce back by the second half of 2022 and catch up most of the lockdown losses.
Trading Ideas:
- TechnologyOne (ASX:TNE) was upgraded as a BUY stock by Bell Potter, increasing its price target by 28% to $12.50, implying 17% share price growth in a year.
- Bullish charting signals have been identified in Challice Mining (ASX:CHN), Jervois Global (ASX:JRV) and Elixir Energy (ASX:EXR), according to Trading Central.
It was a silent night for markets, as Wall Street was closed for the Labor Day public holiday.
European equities are approaching record levels. Tech stocks in Europe increased 1.6%, leading the major European indices higher, after the US jobs report revealed US jobs are growing at their slowest pace in 7 months. The US Central Bank may need to keep monetary policy as is, and not scale back on bond buying. This will keep bond yields and interest rates lower for longer.
The Aussie share market is set to open higher, with the futures suggesting a lift of 0.2%.
What to watch today:
- All eyes will be on tech stocks today. Tech stocks rose 1.2% on the ASX yesterday. Appen (ASX:APX) rose 4.6%, Redbubble (ASX:RBL) rose 3.5% and Technology One (ASX:TNE) rose 2.2%.
- The aluminium price hit a decade high overnight, amid political unrest in Guinea. Global stimulus and the push for climate change investment and tighter supply, has pushed aluminium up 40% this year. This is supporting stocks such as Alumina (ASX:AWC), which rose 3% yesterday and 19% last week. The 15 and 30 day moving averages and the MACD technical indicators, are both suggesting AWC could continue to rally. Also watch other aluminium stocks such as South32 (ASX:S32).
- The iron ore price last traded 3% higher at US$144.83, while the copper price is steady. And the oil price fell below US$69, as it continues to lose momentum after the weaker than expected US jobs report.
- Companies going ex-dividend today include Amcor (ASX:AMC), BlueScope (ASX:BSL), IOOF (ASX:IFL), IGO (ASX:IGO) and Origin Energy (ASX:ORG).
- One of the most traded stocks by Bell Direct clients yesterday was Fortescue Metals (ASX:FMG), which fell 11% after it went ex-dividend. FMG shares are now 30% cheaper than they were in July this year. The technical indicators suggest FMG shares could continue to fall, while the MACD flagged a bullish signal, suggesting this could be the end of FMG’s downtrend.
- In economic news, the RBA meets for the first time this month today at 2:30pm AEST. Rates are tipped to remain on hold at 0.1%. However, all eyes are on the Central Bank’s decision to change its timetable for buying government bonds, with $4 billion of bonds being bought by the RBA until at least the 11th November 2021.
Trading Ideas:
- Cobram Estate Olives (ASX:CBO) was rated for the first time by Bell Potter as a new BUY stock, with a price target of $2.30, implying 14% share price growth in a year.
- Bullish charting signals have been identified in IOUPay (ASX:IOU), Polynovo (ASX:PNV) and Firefinch (ASX:FFX), according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.3%.
What to watch today:
- The iron ore price rose 3% to US$144.83, while copper rose 0.8%. The oil price fell 1% to US$69, as US jobs grew at their slowest pace in 7 months, due to a surge in COVID-19 infections.
- Companies going ex-dividend today: Ramsay Health Care (ASX:RHC), Australian Finance Group (ASX:AFG), Altium (ASX:ALU), Australian Securities Exchange (ASX:ASX), Northern Star Resources (ASX: NST), Orora (ASX:ORA) and Sandfire Resources (ASX:SFR).
- The most traded stocks by Bell Direct clients on Friday were Fortescue Metals (ASX:FMG) and BHP (ASX:BHP).
- In economic news, ANZ job advertisements for August will be released today, the RBA will meet on Tuesday for the first time this month, and business confidence data will be released on Wednesday.
Trading Ideas:
- Visioneering (ASX:VTI) was rated for the first time by Bell Potter as a Speculative BUY, with a price target of $1.31, implying 33% share price growth in a year.
- Pilbara Minerals (ASX:PLS), Hastings Technology Metals (ASX:HAS) and Volpara Health Technologies (ASX:VHT) are all giving off bullish charting signals, according to Trading Central.
Following a mix of good and bad market news this week, the Aussie share market traded cautiously, closing flat (Mon-Thu). And with reporting season officially wrapping up, it was mostly good news for investors.
In this week’s wrap, Jessica covers:
- (0:17) Why volatility may increase in the short term
- (0:41) Good and bad market news this week
- (3:05) The Tech sector making a comeback, rising 2%
- (3:51) Five commodity stocks that saw big gains
- (5:09) A uranium stock that stole the show, lifting 33%
- (5:37) The reporting season finale: 78% of companies beat or met earnings estimates
Yesterday the ASX200 closed in the red, down 0.55%, as investors took profits from several companies trading ex-dividend.
In New York, all three major indices closed with gains. The S&P500 and the Dow Jones closed higher 0.3% and 0.4% respectively. While the Nasdaq advanced 0.1%.
Following US equities, the SPI futures are suggesting the ASX200 will open 0.2% higher.
What to watch today:
- In economic news, yesterday Australia’s Balance of Trade data was released. In July, trade surplus rose by $1 billion, to a record high of $12.1 billion, after June’s reading was upwardly revised to $11.1b. The $12.1b reading was well above the market consensus of $10.2 billion. And today, the Markit Services PMI for August will be released at 9am AEST.
- Companies going ex-dividend today include Ampol (ASX:ALD), Bendigo and Adelaide Bank (ASX:BEN), Cyclopharm (ASX:CYC), People Infrastructure (ASX:PPE) and Resimac Group (ASX:RMC).
- One of the most traded stocks by Bell Direct clients yesterday was Fortescue Metals (ASX:FMG). Its share price was under pressure due to the weakening iron ore price, which fell to a 7-month low this week. Flight Centre (ASX:FLT) was also one of the most traded stocks yesterday, after announcing a joint venture with a travel management business in Japan.
- The oil price is trading 2.4% higher at US$69 a barrel.
- Gold is trading lower at US$1,809 an ounce, awaiting the US government employment report and the Fed’s decision.
- And the iron ore price is trading 1.8% lower at US$140 as China looks to flatline its output of steel.
Trading ideas:
- Bell Potter have upgraded their rating on biotechnology company Imugene (ASX:IMU) from a HOLD to a Speculative BUY, and have increased their price target from $0.25 to $0.52. The upgrade comes after IMU announced 3 separate studies that have the potential to be attractive to future development partners. IMU closed at $0.30 yesterday, implying 30% share price growth in a year.
- Bullish charting signals have been identified in Azure Minerals (ASX:AZS), HomeCo Daily Needs (ASX:HDN) and BARD1 Life Sciences (ASX:BD1), according to Trading Central.
The ASX dropped about 1% yesterday at the open, however better than expected GDP data trimmed losses from lunchtime onwards. Consumer staples and discretionary sectors dragged the market, while energy stocks were strong despite oil prices dropping.
In the US, the S&P500 closed flat for the first day of September. Tech stocks strengthened, which pushed the Nasdaq to close at a record high, and the Dow Jones closed 0.14% lower.
The Aussie share market is set to open lower, with the SPI futures expecting a fall of 0.2% this morning. This follows the mixed session we saw on Wall Street.
What to watch today:
- Australia’s balance of trade data for July will be released today at 11:30am AEST. Expectations suggest that July’s reading will come in at $10.2 billion.
- Companies going ex-dividend today include CSL (ASX:CSL), Deterra Royalties (ASX:DRR), InvoCare (ASX:IVC), Jumbo Interactive (ASX:JIN), NIB Holdings (ASX:NHF) and Woolworths (ASX:WOW).
- One of the most traded stocks yesterday by Bell Direct clients was Kuniko (ASX:KNI). Its share price lifted nearly 19% yesterday, amid the company appointing a new CEO.
- The oil price remained steady following OPEC and its allies agreeing to remain consistent with their existing policy of gradual oil output increases.
- The gold price traded within its range as investors focused on key labour data that could influence the Fed Reserve’s tapering plans.
- The iron ore price plunged over 10% amid production curbs in China.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on gold producer Regis Resources (ASX:RRL) and has increased its price target by 4% to $4.05 (previously $3.89). This is off the back of Regis Resources releasing its financial year 2021 results ahead of both Bell Potter’s and consensus’ expectations. Regis Resources lifted 0.4% yesterday to $2.48, which implies about 63% share price growth.
- Bullish charting signals have been identified in Immutep (ASX:IMM), Janison Education Group (ASX:JAN) and Charter Hall Group (ASX:CHC) according to Trading Central.
US stocks soured on the last trading day of August, with the major indices closing slightly lower. House prices across 20 capital cities rose 19.1% year on year, the biggest jump since 1987. In addition, consumer inflation expectations grew higher. Investors are therefore adjusting their portfolios and looking for stocks in higher interest rate environments, as well as taking profit ahead of the Fed’s meeting.
The Aussie share market will kick off September cautiously, with the futures down 0.4%, ahead of economic growth data being released.
What to watch today:
- GDP data for the second quarter will be released today at 11:30am AEST, expected to be 0.5%. Third quarter GPD will likely show a 3% fall. If the GDP data is weaker than expected, investors are likely to buy staples and utilities, or take profits in growth sectors such as financial, energy and industrials. However, if GDP is stronger than expected, the reverse may occur.
- The iron ore price fell slightly, while the copper price fell 0.3%. Meanwhile, the oil price fell below US$69, falling from its one month high, amid Hurricane Ida forcing US refineries to shut. Oil has also fallen as Washington pushes OPEC to pump more oil.
- Companies going ex-dividend today are Iress (ASX:IRE), Wesfarmers (ASX:WES) and Mount Gibson Iron (ASX:MGX).
- One of the most traded stocks by Bell Direct clients yesterday was Shopping Centres Australasia (ASX:SCP). SCP shares rose 1.5% as more Australians get vaccinated. SCP’s chart flagged a technical bullish signal, with MACD indicating SCP shares could continue to rally over the short term. The chart’s moving averages also recently formed a golden cross, meaning upside could be ahead.
Trading Ideas:
- Carbon Revolution (ASX:CBR) was reiterated as a Speculative BUY by Bell Potter, with an increased price target of $1.80 (previously $1.78), implying 58% share price growth in a year.
- FireFinch (ASX:FFX), Aussie Broadband (ASX:ABB) and Ava Risk Group (ASX:AVA) are all giving off bullish charting signals, according to Trading Central.
US stocks surged to new records again overnight, as investors seek out higher growth assets ahead of the Fed scaling back stimulus.
The Aussie share market will likely rally for the second day. The futures are suggesting a lift of 0.2%, with all eyes on tech stocks, reporting season and economic news. What to watch today:
- Building permits for July will be released today, with the market expecting a fall of 5%. Keep an eye on companies such as Brickworks (ASX:BKW), CSR (ASX:CSR), Boral (ASX:BLD) and other companies in the building material industry.
- The iron ore price is steady at US$160. However, the short term indicators are flagging that the iron ore price should start to bounce back.
- The copper price rose 1.1%, which supported New York listed BHP, rising 1.6%, and New York listed RIO followed. Watch Aussie listed BHP (ASX:BHP), Rio Tinto (ASX:RIO) and other iron ore and copper stocks.
- The oil price steadied at US$69.17.
- Company earnings today:
- Regis Resources (ASX:RRL) reported a 27% fall in profit to $146 million. The market expected profit of $156.5 million.
- Sandfire Resources (ASX:SFR) reported record profit. Net profit rose 132% to $170.1 million, falling slightly short of market expectations of $200.8 million profit.
- Regis Healthcare (ASX:REG) reported profit soared over 2000% to $19.9 million.
- Companies going ex-dividend today: Appen (ASX:APX) and Link Administration (ASX:LNK)
- One of the most traded stocks by Bell Direct clients yesterday was Fortescue Metals (ASX:FMG). FMG shares rose 6.6%, trading above its 15-day average for the first time since July. The technical indicator MACD, looks like it will flag a bullish signal, suggesting FMG’s rally could continue in the short term.
Trading Ideas:
- Drilling company DDH1 (ASX:DDH) was reiterated as a Bell Potter BUY, with an increased price target of $1.48 (previously $1.45), implying 30% share price growth in a year.
- Citi flagged Flight Centre (ASX:FLT) as a HOLD, following its results. Citi also increased FLT’s price target to $16.94.
- Paladin (ASX:PDN), Red 5 (ASX:RED) and Perseus Mining (ASX:PRU) are all giving off bullish charting signals, according to Trading Central.
US stocks rebounded on Friday to new record highs. Tech stockswere higher as the market prepares for the Federal Reserve Chair Jerome Powell to pull back on monetary stimulus.
The oil price, the proxy for economic growth, formed a 6 day uptrend. The oil price posted its biggest weekly rally in a year, with oil bracing for restricted supply ahead of Hurricane Ida.
This morning, the Aussie share market will likely follow US stocks higher. The futures are suggesting a lift of 0.2%, with all eyes on tech, iron ore, and company results.
What to watch today:
- The iron ore price is steady after falling below US$160 for the first time since February.
- The copper price rose 1.7%, which supported New York listed BHP rising 2.7% and Rio Tinto rising 2.6%. Expect the Aussie listed BHP, RIO, and other iron ore and copper stocks to lift today.
- The gold price is holding steady, after rising slightly above US$1800, lifting 0.1% ahead of the Fed unveiling its tapering timeline.
- Company earnings today:
- Fortescue Metals (ASX:FMG) is set to report record profit of US$10.3 billion. However, future growth is expected to dim, as the iron ore price is down over 20% from its high and steel demand remains restricted in China.
- Orocobre (ASX:ORE) is also due to report today after merging with Galaxy Resources, to create the world’s 5th biggest lithium company.
- Bubs Australia (ASX:BUB), Healius (ASX:HLS) and Australia Finance Group (ASX:AFG) are also set to report today.
- Oil Search (ASX:OSH) and Woodside Petroleum (ASX:WPL) go ex- dividend today.
- The most traded stocks by Bell Direct clients last Friday: Brickworks (ASX:BKW)’s share fell 2.8% last week after construction work fell more than expected. And Fortescue Metals (ASX:FMG)’s shares continued to fall for the 6th week, as demand for steel contracts. FMG shares fell about 2% last week ahead of reporting results to the market today.
Trading Ideas:
- Eagers Automotive (ASX:APE) was reiterated as a Bell Potter BUY, with a price target of $18.75, implying 16% share price growth in a year.
- Citi flagged Wesfarmers (ASX:WES) as a SELL, following its earnings results, and Citi expects WES shares to fall to $47.00 in 12 months.
- Fertoz (ASX:FTZ), Clearview Technologies (ASX:CPV), and Stavely Minerals (ASX:SVY) are all giving off bullish charting signals, according to Trading Central.
Aussie investor sentiment dampened as COVID-19 cases hit new highs and weaker than expected economic data was released. Meanwhile, global markets brace for big change, with the US Federal Reserve to potentially scale back support.
In this week’s wrap, Jessica covers:
- (0:50) The Aussie share market bracing for another pullback
- (2:02) Investors buying into growth sectors while selling defensive sectors
- (2:31) WiseTech (ASX:WTC) soaring over 30% on positive financial results and signing FedEx as a client
- (3:09) Travel stocks flying higher as Australia's borders are set to open in December
- (4:55) Two company reports to watch next week
Yesterday the Aussie share market closed in the red, closing 0.54% lower.
In overseas markets, investors are cautions as they await the meeting of US Federal Reserve policymakers as well as new developments in Afghanistan also played a part for investors in the risk- off sentiment.
Following US equities, the SPI futures are suggesting the ASX200 will open slightly lower.
What to watch today:
- In economic news, retail sales data for July will be released at 11:30am AEST. In June, retail sales declined 1.8% month over month, impacted heavily by the nation-wide lockdowns. The market is expecting a 2.3% decline.
- Travel stocks, Flight Centre (ASX:FLT) and Qantas (ASX:QAN), were among the most traded stocks by Bell Direct clients yesterday, after both companies reported their 2021 financial year results. FLT reported a 79% decline in revenue and a $507.1 million underlying loss, while QAN reported a 58% decline in revenue, heavily impacted by border closures and travel restrictions.
- Companies reporting today include: Auswide (ASX:ABA), BWX (ASX:BWX), Next DC (ASX:NXT), Resolute Mining (ASX:RSG), Village Roadshow (ASX:VRL) and Wesfarmers (ASX:WES).
- The oil price has fallen 0.9% and is trading at US$67.74 a barrel.
- Gold fell for the 3rd consecutive session, amid a slightly stronger dollar.
- And iron ore has fallen 1.8% and is trading at US$159 a tonne.
Trading ideas:
- Bell Potter has maintained their BUY rating on The a2 Milk Company (ASX:A2M), however have decreased their price target from $8.50 to $7.70. This comes after A2M reported its 2021 financial year results yesterday. A2M closed yesterday at $6.05, implying 27.3% share price growth in a year.
- Wisr (ASX:WSR), Tyro Payments (ASX:TYR), and Swoop Holdings (ASX:SWP), are all giving all bullish charting signals, according to Trading Central.
US stocks extended their rally with both the S&P500 and Nasdaq closing higher for the fifth straight session. The gains were supported by the US 10-year Treasury yield edging higher.
Despite the US pushing higher, if you go by the SPI futures, it’s suggesting that the Aussie share market will open slightly lower.
Stay tuned, later today we will be releasing a full report on The a2 Milk Company (ASX:A2M) and Woolworths (ASX:WOW)’s results.
What to watch today:
- It’s another big day of earnings season for Aussie shares. Investors will be digesting the results from companies including Appen (ASX:APX). Bell Potter expects NPAT to come in at US$11.1m. A few travel companies will report today, including Qantas (ASX:QAN), Flight Centre (ASX:FLT) & Air New Zealand (ASX:AIZ). Bell Potter are expecting Qantas to report a huge loss of $1.226 billion. Consensus is even more bearish, expecting a loss of $1.324 billion.
- Other companies reporting today: Atlas Arteria (ASX:ALX), Blackmores (ASX:BKL), Costa Group Holdings (ASX:CGC), IOOF Holdings (ASX:IFL), Jumbo Interactive (ASX:JIN), Ramsay Health Care (ASX:RHC), St Barbara (ASX:SBM) and Whitehaven Coal (ASX:WHC).
- One of the most traded stocks yesterday by Bell Direct clients was Flight Centre (ASX:FLT). Its share price lifted 7.4% yesterday, as investors eyed easing restrictions as vaccination numbers surge.
- The oil price rose on US fuel demand. US government data showed that fuel demand climbed to its highest level since the start of the COVID-19 pandemic.
- The gold price fell, further below the US$1,800 level as the dollar pushed higher and investors focused on the Fed’s verdict coming up this week.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on software and services business Infomedia (ASX:IFM) and has increased its price target by 14% to $2 (previously $1.75). This is off the back of Infomedia releasing its financial year 2021 results ahead of Bell Potter’s forecast and the guidance. IFM lifted 4.9% yesterday to $1.71, which implies about 17% share price growth.
- Bullish charting signals have been identified in The a2 Milk Company (ASX:A2M), Fletcher Building (ASX:FBU) and Element 25 (ASX:E25) according to Trading Central.
US stocks gained for the fourth straight day.
The Aussie share market will likely follow US stocks higher. The futures suggest a lift of 0.24%, with all eyes on travel, tourism and oil stocks.
Stay tuned, later today we will be releasing a full report on Zip (ASX:Z1P)’s results.
What to watch today:
- The iron ore and copper prices both rose 0.4%. The modest gains supported BHP listed in New York, which rose over 1%, while RIO rose almost 3%. Expect Aussie listed BHP, RIO and other iron ore and copper stocks to rise today.
- The gold price holds above US$1800.
- Company earnings results today:
- Afterpay (ASX:APT)’s key performance metric, its transaction margin, came in at 2.1%. This shows APT saw a drop in the money it makes from transactions (compared to last year’s net transaction margin of 2.3%). APT’s loss after tax deeply worsened, falling 597% to a loss after tax of $159.4 million, while the market expected a loss of just $17 million.
- Zip (ASX:Z1P) is set to report later today.
- Medibank (ASX:MPL)’s annual profit grew 40% to $441.2 million, amid policyholder growth and less payouts. Profit beat the $424.7 million expected.
- Adbri (ASX:ABC) 1H net profit grew 95% on the year to $56.6m. However, profit fell slightly short of market expectations of $60 million.
- Clarity Pharmaceuticals (ASX:CU6) is set to list and start trading today, with a market value of nearly $360 million. CU6 is a radiopharmaceutical company with five clinical trials currently underway, to treat various conditions and cancers.
- Kuniko (ASX:KNI) is also a new listing, whose parent organisation is Vulcan Energy (ASX:VUL).
- Most traded stocks by Bell Direct clients yesterday include Qantas (ASX:QAN) and Monadelphous (ASX:MND).
Trading Ideas:
- Austal (ASX:ASB) was reiterated as a Citi BUY, however the investment bank dropped ASB’s 12 month price target to $3.10 (previously $3.35). ASB has new US opportunities continuing to emerge. Citi recognises ASB trades at a 73% discount to its global ship building peers.
- Alcidion (ASX:ALC) was reiterated as a Bell Potter BUY, with a $0.45 price target, implying 23% share price growth in a year.
- Scentre Group (ASX:SCG), Firefinch (ASX:FFX) and CogState (ASX:CGS) are all giving off bullish charting signals, according to Trading Central.
US stocks rallied for the third straight day as equities climbed back to record highs. Investors bought into oil, tourism and vaccine stocks.
Following the US, the Aussie share market is set to open higher.
What to watch today:
- ASX listed vaccine developers are likely to rally, such as CSL (ASX:CSL) and Telix Pharmaceuticals (ASX:TLX). This follows the US overnight, where Pfizer shares rose over 2%, BioNTech shares rose about 10%, Moderna rose 9%, and Trillium Therapeutics soared 188% off the back of news of a Pfizer takeover.
- Expect oil stocks to charge. After the oil price jumped 6%, it partially recovered from its 9% pull back. This is its biggest weekly decline in 9 months.
- The copper price jumped 1.9%. This supports stocks such as BHP (ASX:BHP) and Oz Minerals (ASX:OZL).
- Company earnings results today:
- Seek (ASX:SEK) reported a net profit of $752 million in the 2021 financial year, rebounding from 2020’s loss of $113 million. As for the current financial year, SEK guided that profit will be lower, between $190 million and $200 million, amid unprecedented COVID-19 conditions.
- Boral (ASX:BLD) recovered from a $1.1 billion loss in 2020, swinging profit in FY21 to $639.9 million. This is an 156% improvement, beating market expectations of $260 million. The company will not be paying a final dividend, to preserve capital and remain cautious of COVID-19 conditions.
- Johns Lyng Group (ASX:JLG) reported net profit grew 17% in the full year to $18.6 million, missing expectations of $21.2 million profit.
- Western Areas (ASX:WSA) reported net loss after tax of $7.7 million, in line with expectations.
- AMA (ASX:AMA) reported a net loss of $97 million, after the market expected a profit. AMA declared it is unable to pay a final dividend.
- McMillan Shakespeare (ASX:MMS) reported net profit of $61 million.
Trading Ideas:
- Best & Less (ASX:BST) was initiated as a Bell Potter BUY rating, with a price target of $3.30, implying 30% share price growth in a year.
- Openpay Group (ASX:OPY), Genetic Signatures (ASX:GSS) and Arometrex (ASX:AMX) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market will likely follow US stocks trading higher on Friday, with the futures suggesting a lift of 0.5%.
What to watch today:
- Company earnings and announcements today:
- Sonic Healthcare (ASX:SHL) reported its full year net profit grew 149% to $1.32 billion. This beat market expectations of $1.28 billion profit. SHL lifted its final dividend 8% to 55cps.
- Charter Hall (ASX:CHC) reported its full year profit rose 38% to $477 million.
- G8 Education (ASX:GEM) reported its first half net profit more than doubled to $25.1 million and revenue lifted 39%. G8 Education declared it won’t be paying a dividend.
- Sims Metals Management (ASX:SGM) will launch a $150 million share buy-back.
- IGO (ASX:IGO) announced its produced its first lithium hydroxide product through its 49% joint venture in Australia’s first lithium hydroxide project.
- Ampol (ASX:ALD) lobbed a takeover offer on Z Energy, a New Zealand petrol station operator, for NZ$3.78 per share.
- The oil price settled 2.2% lower, falling for the 7th session and losing about 10% in the week, as demand concerns linger given global COVID-19 cases trend higher.
- The copper price, the proxy for economic growth, is now 11% lower from its July high. However, as indicated by MACD and RSI, copper has been oversold.
- The iron ore price is slightly higher, up 0.1% to US$160.
- In economic news, services and manufacturing data for August will be released today. And on Friday, the Fed Chairman will give a speech.
Trading Ideas:
- While hard commodities continue to fall, soft commodities, such as poultry, are trading at record high territory. Therefore, Bell Potter has upgraded its BUY rating on Inghams (ASX:ING), with an increased price target from $4.25 to $4.55, implying 11% share price growth in a year. ING reported profit ahead of expectations.
- Maggie Beer Holdings (ASX:MBH), Kangaroo Island Plantation Timbers (ASX:KPT) and Peel Mining (ASX:PEX) are all giving off bullish charting signals, according to Trading Central.
Geopolitical tensions, local lockdowns, and global COVID-19 resurgences saw the volatility index hit its highest level in five months. As a result, the Aussie share market entered a short-term technical downtrend, however the long-term market uptrend remains intact.
In this week’s wrap, Jessica covers:
- (0:07) Why Australia is set to see its worst economic growth rate in 19yrs
- (1:37) How, despite a short-term technical downtrend, long-term growth remains intact
- (3:17) Banks, Energy, and Materials all taking a dip
- (3:40) NRW Holdings (ASX:NWH) rising 16% after reporting better than expected results
- (4:57) The reporting season big picture - 80% of companies have beat/met expectations
European markets closed lower, and US equities made slight gains, after the latest Federal Reserve minutes included discussion to remove some monetary stimulus this year.
This morning the ASX200 is set to open higher, with the futures suggesting a rise of 34 points or 0.46% to 7,409 points.
What to watch today:
- In economic news, yesterday the unemployment rate for July fell to 4.6%, after the market expected unemployment to rise from 4.9% to 5%. This is the lowest unemployment rate since 2008. Also, at 9:05am AEST, the RBA assistant governor Christopher Kent will give a speech to Foreign Exchange markets.
- Cochlear (ASX:COH) is set to release its full year results today. Bell Potter and Citi expect NPAT of $250m.
- The companies set to report earnings today include: Adairs (ASX:ADH), Cleanaway Waste Management (ASX:CWY), Inghams (ASX:ING), Steadfast (ASX:SDF), TPG Telcom (ASX:TPG), and Sydney Airport (ASX:SYD).
- The most traded stocks by Bell Direct and advised clients yesterday were BHP (ASX:BHP), Fortescue Metals (ASX:FMG) and Mineral Resources (ASX:MIN).
- The oil price has dropped more than 4.5%, trading at US$62.50 a barrel.
- The gold price is trading 0.4% lower and copper fell 1.8%. And iron ore is trading 0.5% higher at US$160 a tonne.
Trading ideas:
- Bell Potter maintain their BUY recommendation on Australia and New Zealand Bank (ASX:ANZ), with an increased price target from $30 to $31, after a positive third quarter trading update. ANZ closed 0.4% lower yesterday, implying 8.9% share price growth in a year. However, Citi retain a SELL on ANZ.
- Bullish charting signals have been identified in Uniti Group (ASX:UWL), Volpara Health Technologies (ASX:VHT) and Magnis Energy Technologies (ASX:MNS), according to Trading Central.
Well, US equities once again headed south overnight, with all three major benchmarks closing in the red as investors digested the latest Federal Reserve meeting minutes.
The Aussie share market today will likely follow the US, with the futures down 0.66% or 50 points to 7,378.
What to watch today:
- It’s also another huge day of earnings season. Investors will be digesting the results from a number of companies. These include the Australian Securities Exchange (ASX:ASX) with consensus expecting NPAT to come in at $474.7m. Evolution Mining (ASX:EVN) is also set to report with consensus expecting NPAT to comes in at $375.6m, however Bell Potter are more bearish and are expecting NPAT of $389m.
- Also keep an eye out for results from Iress (ASX:IRE), Orora (ASX:ORA), Origin Energy (ASX:ORG), Perpetual (ASX:PPT), Redbubble (ASX:RBL), South32 (ASX:S32), Star Entertainment Group (ASX:SGR), Newcrest Mining (ASX:NCM) and Treasury Wine Estates (ASX:TWE).
- The most traded stocks yesterday by Bell Direct clients included BHP (ASX:BHP) who after revealing its energy deal with Woodside Petroleum (ASX:WPL) and its decision to end its dual-listed company structure, saw its shares plummet 7%, its worst one-day loss since May last year. WPL was also a most traded stock and saw its shares fall 2.1% yesterday.
- In terms of economic news, the unemployment rate will be released today at 11:30am AEST. Due to the multiple COVID-19 restrictions across the country, it’s expected that July’s reading will come in at 5%, and further increase to 5.5% over the next few months.
- Following a surge in COVID-19 cases worldwide and a strengthening US dollar, investors are cautious of the outlook for fuel demand. This saw the oil price fall about 1.7% on Wednesday, to settle at US$65.46 per barrel.
- The gold price continues to hold steady at US$1,789, while the iron ore price tumbled toward US$150 a tonne.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on Domino’s Pizza (ASX:DMP) and increased its price target by 17% to $155 (previously $132). This is off the back of Domino’s strong all-round FY21 result they released yesterday.
- Bullish charting signals have been identified in Calix (ASX:CXL), Fertoz (ASX:FTZ) and Fisher & Paykel Healthcare (ASX:FPH) according to Trading Central.
US stocks headed south overnight, after disappointing retail sales data. US retail sales fell 1.1% in July, when market expectations were a fall of just 0.3%.
In addition, the Taliban has taken control of Afghanistan’s capital city, and China’s COVID-19 cases surged to an 8 month high.
Following the US, the Aussie share market is set to open lower.
Stay tuned, later today we will be releasing a full report on Coles (ASX:COL) and CSL (ASX:CSL)’s results.
What to watch today:
- BHP have announced its petroleum business will merge with Woodside Petroleum (ASX:WPL), in the aim of reducing petroleum assets. WPL investors will hold the majority stake of the merged company. BHP also announced a $7.8 billion potash project, as well as the end of its dual-listed company structure.
- BHP also reported its FY21 results, delivering record dividends to shareholders, with a US$2.00 final dividend. Profit grew 88% to US$17 billion, while earnings grew 69% to US$37.4 billion.
- Dominos (ASX:DMP) reported underlying annual NPAT grew 29% to $188.2 million, slightly above market expectations of $187.7 million.
- Coles (ASX:COL) reported annual profits grew 3%, and CSL (ASX:CSL) reported its annual profit rose 13%. Stay tuned to Bell Direct Reporting Season Coverage, with everything you need to know
- The oil price has fallen for the 4th session, which is the longest loosing streak since March. Oil is trading at US$66.63 a barrel, as global COVID-19 cases are trending higher.
- The gold price is steady, trading at US$1,787, while the iron ore price rose 0.2%.
- Cotton hit a 7 year high overnight, while the price of sugar rose to another 4 year high.
Trading Ideas:
- Mesoblast (ASX:MSB) was reiterated as a Bell Potter Speculative BUY, with a price target of $3.60, implying 89% share price growth in a year.
- Limeade (ASX:LME), Red 5 (ASX:RED) and Ava Risk Group (ASX:AVA) are all giving off bullish charting signals, according to Trading Central.
This morning, the Aussie share market is set to open higher.
What to watch today:
- The financial sector, led by Commonwealth Bank (ASX:CBA) and other major banks, has started to trend lower, putting weight on the market. Technical traders are taking profits from the big banks. CBA shares have fallen for the third day. Amid lockdowns, expect further selling in banks.
- Galaxy Resources (ASX:GXY) has received court approval for its merger with Orocobre (ASX:ORE), making the company Australia’s biggest lithium miner and the 5th biggest in the world.
- Breville (ASX:BRG) reported its best year of sales, with $1.2 billion in sales for the 2021 financial year. BRG reported a 25% increase in profits to $91 million, meeting expectations.
- SCA Property Group (ASX:SCP) reported its NPAT rose 441% to $462.9 million. This was driven by an increase in the fair value of its investment properties. Reports beat profit expectations of $151.3 million.
- Sims Metals Management (ASX:SGM) reported its profit after tax surged 186.5% to $229.4 million. Profit expectations were $235 million.
- BHP (ASX:BHP) will report today after market close.
- The oil price is trading 0.3% higher at US$67.40 a barrel.
- The gold price has gained for the fourth session and is trading at US$1,789, while the iron ore price fell 0.6% to US$166.96.
- The RBA meeting minutes will be released today.
Trading Ideas:
- Australia’s largest insurance broker Steadfast Group (ASX:SDF) was reiterated as a Citi BUY. The investment house increased SDF’s price target from $4.60 to $5.30.
- PPK Group (ASX:PPK), PKS Holdings (ASX:PKS) and Liberty Financial Group (ASX:LFG) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting a fall of 0.1% or 9 points.
What to watch today:
- So far this reporting season, 80% of companies that have released their results, have met or exceeded guidance.
- JB Hi-Fi (ASX:JBH) reporting NPAT growth of 67.4% to $506.1 million in the 2021 financial year, in line with expectations.
- GPT Group (ASX:GPT) reported net profit soared 246% to $760.5 million, beating expectations of $291.7 million profit growth.
- Also set to report today: Beach Energy (ASX:BPT) and Lendlease (ASX:LLC). BHP (ASX:BHP) will report tomorrow.
- The oil price is trading 0.4% lower at US$68.17 a barrel.
- The gold price is up 0.1% to US$1,780, and the iron ore price is slightly higher up 0.1% to US$167.95
- Economic news this week: Tomorrow, BRA meeting minutes will be released. Employment data is out on Thursday, with unemployment expected to rise to 5% from 4.9%.
Trading Ideas:
- Bell Potter upgraded its price target on Liontown Resources (ASX:LTR), from $0.61 to $1.33.
- Hazer Group (ASX:HZR), Silver Mines (ASX:SVL), and Duratec (ASX:DUR) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market rose above 7,600 points this week, breaking a historical record. Themes remained consistent, with Lithium and Financial stocks continuing to make headway.
In this week’s wrap, Jessica covers:
- (0:46) Financials rising 3% after CommBank (ASX:CBA) reported better than expected profits
- (1:35) Lithium and Agricultural stocks delivering the goods
- (3:20) Three key reasons why the Lithium train isn't slowing down...
- (5:04) The good, the bad, and the ugly: reporting season results so far
- (6:53) The expected rise in the unemployment rate
Australian shares were trading higher yesterday, supported by strong earnings reports.
US equities edged higher overnight, with both the blue-chip Dow Jones and the S&P500 closing at record highs.
This morning the ASX200 is set to rise 0.4% or 28 points, to 7,526 points.
What to watch today:
- Yesterday, consumer inflation expectations decreased to 3.3% in August, which was below expectations of 3.8%. Today, New Home Sales data for July will be released at 2pm AEST, expected to increase 13%.
- Baby Bunting (ASX:BBN) released their full year 2021 results this morning. Total sales increased 15.6% to $468.4 million. Statutory NPAT increased 76% to $17.5 million. The company also announced a fully franked final dividend of 8.3 cents per share, that’s a full year dividend of 14.1 cents, up 34.1%.
- Commonwealth Bank (ASX:CBA) was one of the most traded stocks by Bell Direct clients yesterday. CBA fell yesterday after a week on an uptrend, and after hitting a record high on Monday. CBA is a Bell Potter BUY stock, while other brokers are bearish. CBA is a Macquarie and Morgan Stanley SELL stock. And Citi released a report yesterday, downgrading CBA to SELL.
- Rio Tinto (ASX:RIO) was also one of the most traded stocks yesterday, after trading ex-dividend yesterday morning. RIO are paying shareholders fully franked dividends of 760.06 cents per share. RIO closed more than 1% lower yesterday. And overnight, the UK listed Rio Tinto dragged down mining stocks in Europe, falling 5.5%, while RIO’s US listed shares fell 1.7% in New York.
- The oil price fell 0.5% to US$68 a barrel following concerns of rising COVID-19 cases in China.
- The gold price has edged 0.1% higher and the iron ore price is trading 0.7% lower at US$167 a tonne.
Trading ideas:
- Bell Potter have a BUY recommendation on Lycopodium (ASX:LYL), a provider of full lifecycle services to the Mineral Processing industry. Bell Potter have reduced their price target on LYL from $6.50 to $6.00, as ongoing COVID-19 restrictions increase operational difficulty.
- Bullish charting signals have been identified in Challenger Exploration (ASX:CEL), Deterra Royalties (ASX:DRR), and Corporate Travel Management (ASX:CTD), according to Trading Central.
The Aussie share market looks set to open in the green, up 0.13% or 10 points to 7,503, if you go by the futures.
What to watch today:
- This morning, company’s reporting earnings:
- Telstra (ASX:TLS) announced an on-market share buy-back, that will return about 50%, or up to $1.35 billion to shareholders during financial year 2022.
- AMP (ASX:AMP) reported an improved first half 2021 performance with underlying NPAT of $181 million, up 57%.
- QBE Insurance Group (ASX:QBE) announced a first half 2021 statutory NPAT of $441 million, compared with a net loss after tax of $712m in the prior period. QBE also reported gross written premium (GWP) growth of 20%.
- AGL Energy (ASX:AGL) reported a 10% statutory loss after tax and an interim ordinary dividend of $0.31cps and special dividend of 10 cents declared.
- Goodman Group (ASX:GMG) and Mirvac Group (ASX:MGR) are also set to report today.
- The most traded stocks by Bell Direct clients yesterday were Galaxy Resources (ASX:GXY) & Pilbara Minerals (ASX:PLS). Both stocks hit record highs yesterday, lifting over 5% as the demand for battery materials remains strong. GXY shares are up 153% YTD, while PLS shares are up a huge 182%.
- In economic news, consumer confidence data was released yesterday, with sentiment falling to its lowest reading in 11 months. Confidence has been hit hard amid extended lockdowns across the country. However, sentiment remains in positive territory overall. August’s reading came in at 104.1, a decline of 4.4% when compared with July’s reading.
- The oil price reversed it losses to trade in the green on Wednesday, at US$69.34, up 1.5% .
- The gold price also lifted about 1.4% as US inflation readings eased fears that the Federal Reserve would taper its economic support sooner than expected.
- The iron ore price traded slightly up, at about US$169.
Trading ideas:
- Bell Potter has upgraded its recommendation on Australia’s largest company, Commonwealth Bank (ASX:CBA) from a HOLD to a BUY, with an increased price target of $118 (previously $105). Bell Potter highlighted CBA’s report card yesterday was a solid result for the business despite the expected pandemic impacts and ongoing lingering uncertainty in operating conditions. CBA lifted 1.5% higher yesterday to $108.17, which implies about 9.1% share price growth.
- Bullish charting signals have been identified in Senex Energy (ASX:SXY), Imdex (ASX:IMD) and Opthea (ASX:OPT) according to Trading Central.
US stocks reached record highs after the US Senate passed a $1 trillion infrastructure bill. Funds will go towards building transportation, an electric vehicle grid, charging stations, and cybersecurity.
Overnight, investors bought stocks in energy, mining and industrials as the oil price rose back to US$68. Tech stocks succumb to profit taking, including Moderna, which fell 5%, after jumping 17% the session prior.
This morning the futures are suggesting the Aussie share market will rally up 0.3%.
Stay tuned, later today we will be releasing a full report on Commonwealth Bank (ASX:CBA)’s results.
What to watch today:
- CommBank (ASX:CBA) will boost sentiment today, after releasing their earnings results this morning. Headline profit surged 19% to $8.8 billion, beating the $8.6 billion expected, supported by a surging business and household lending. CBA increased its full year dividend by 17% to $3.50 and announced a $6.2 billion share buyback to return money to shareholders. This is over $1 billion more than expected.
- More company reports today: IAG (ASX:IAG) reported a profit loss of $427 million. Computershare (ASX:CPU) reported profit of US$188 million, missing market expectations of US$284.9 million.
- The oil price is up 0.3% to US$68.42 a barrel.
- The gold price fell 0.1% to US$1,729, to another 4 month low, while the iron ore price fell 2.8%.
- Consumer confidence data will be released today.
Trading Ideas:
- Telix Pharmaceuticals (ASX:TLX) was initiated as a Bell Potter Speculative BUY, with an $8.00 price target, implying over 44% share price growth in a year.
- oOh!media (ASX:OML), Bentley Capital (ASX:BEL) and Australian Vintage (ASX:AVG) are all giving off bullish charting signals, according to Trading Central.
US investors brace for a big jump in US inflation data on Wednesday night.
Overnight, the energy sector fell 1.5% on concerns of rising COVID-19 cases. Investors sold stocks tied to the economic recovery, with American Airlines and United Airlines both falling 2%.
This morning, the futures are suggesting the Aussie share market will rally 0.3%.
What to watch today:
- Australia will soon receive the Moderna vaccine, which was approved for use by the TGA.
- Challenger (ASX:CGF) announced a huge recovery in the 2021 financial year. The company swung from a loss in 2020, to $592 million statutory NPAT, compared to the expected $284 million. CGF’s profit strengthened as its asset under management (AUM) grew and saw record sales growth. CGF declared a full year dividend of $0.20ps, which is a 14% jump on last year. CGF guided for a stronger FY22, with expected profit to grow 15%.
- Coronado Glaobal Resources (ASX:CRN) will report its HY21 results today at 10am AEST.
- The oil price fell $0.40 or 0.6%, compared to this time yesterday. Oil is now trading at US$66.84 a barrel, the same price it traded at in May.
- Gold holds a four month low, however it rose slightly by 0.3%, after tumbling on stronger than expected job data.
- The seaborne iron ore price gained 0.9%, supporting Rio Tinto listed in New York, which rose 0.7%, while BHP fell 0.2% in New York, after the copper price fell over 1%. Expect the locally listed counterparts to see volatility.
- Business confidence data will be released today.
Trading Ideas:
- The a2 Milk Company (ASX:A2M) was reiterated as a Bell Potter BUY, with a price target of $8.50, implying over 45% share price growth in a year.
- Karoon Energy (ASX:KAR), Elixr Energy (ASX:EXR) and Senex Energy (ASX:SXY) are all giving off bullish charting signals, according to Trading Central.
Today, the Aussie share market is set to rally up 0.4% as stocks in the US mostly closed higher on at the weekend following a stronger than expected US jobs report.
All eyes this week will also be on companies reporting.
What to watch today:
- The NSW Premier set a target for 70% of the population to be vaccinated before restrictions are eased. NSW construction works in non-hotspot LGAs are now allowed back at work, if they have received their first vaccine dose.
- Suncorp (ASX:SUN) reported NPAT jumped 13% to $1.3 billion, beating the $976.3 million profit expected. SUN also declared a 40cps dividend, a special 8cps dividend, and a $250 million share buyback. Suncorp also reported that the biggest growth in the financial year came from a 42% jump in insurance profit and a 69% jump in banking profit thanks to surges in lending and savings.
- Reporting this week: Commonwealth Bank (ASX:CBA) report on Wednesday, with headline profit expected to be $8.6 billion with a $5 billion share buyback for shareholders. Also, Telstra (ASX:TLS) reports on Thursday, with expected profit of $1.5 billion and $1.4 billion share buyback for shareholders.
- The oil price fell 1.2% to US$67.24 a barrel, on fears that demand will slow as US COVID-19 cases are at a 6 month high.
- Gold slid 2% on stronger than expected US job numbers. And iron ore steadied, gaining 0.1%. In New York on Friday, RIO finished 0.2% up, while BHP fell 0.4%.
- Business and consumer confidence data will be released on Tuesday and Wednesday.
Trading Ideas:
- Comet Ridge (ASX:COI) was reiterated as a Bell Potter Speculative BUY, with an increased price target of $0.18.
- FYI Resources (ASX:FYI), Sheffield Resources (ASX:SFX) and Corporate Travel Management (ASX:CTD) are all giving off bullish charting signals according to Trading Central.
Despite rising COVID-19 cases and a falling iron ore price, the Aussie share market rose 1.6% (Mon-Thu), its best gain in 11 weeks. The electric vehicle (EV) mega trend continued to make headlines... Could EV stocks continue to gain momentum and overtake sentiment more recently reserved for the buy now pay later (BNPL) industry?
In this week’s wrap, Jessica covers:
- (0:37) The Tech sector's huge 11% boost this week
- (1:29) The iron ore price falling into bear market territory
- (2:22) Afterpay (ASX:APT) rising 29% on plans it will be taken over by US giant, Square
- (3:58) Why the lithium sector is worth taking a closer look at
- (4:54) Why upside is ahead for the Aussie share market
- (6:07) Next week's focus on share buy backs and dividends
- (7:29) Three key economic news items to watch next week
All three major US benchmarks pushed higher overnight. Energy and travel stocks bounced back ahead of Friday’s key jobs report, a key data point for the Federal Reserve as it considers when to tighten monetary policy.
Following the US, the Aussie share market is set to open ever so slightly higher, up 0.04% or 3 points to 7,423.
What to watch today:
- Today, we have RBA Governor Phillip Lowe testifying at 9:30am AEST, followed two hours later by the RBA’s statement on monetary policy.
- ResMed (ASX:RMD) announced its fourth quarter fiscal year 2021 results. RMD’s revenue increased by 6% to US$3.2 billion on a constant currency basis in comparison to the prior year period, and operating profit was up 12% on a non-GAAP basis. RMD closed yesterday at $37.18, trading at record high territory.
- REA Group (ASX:REA) are set to report its financial year 2021 results. According to Goldman Sachs analysts, a 12% increase in REA’s revenue is expected as well as a 20% lift in EBITDA.
- James Hardie (ASX:JHX) will be holding its AGM today.
- The most traded stocks by Bell Direct clients yesterday: Fortescue Metals (ASX:FMG) after its share price came under pressure yesterday following the news that one of its contractors had returned a weak positive test result for COVID-19, which saw FMG’s share price fall 3.4%. However, it was later advised by the Department of Health, that the contactor had subsequently returned a negative test result. Also, Pinnacle (ASX:PNI, its share price lifted about 9% yesterday after reporting its financial year 2021 results, where the company’s net profit increased by more than 100% on the prior year.
- The oil price lifted about 1.4%, the gold price dropped 0.4% overnight, and the iron ore continues to come under pressure, falling about 5.8% to US$171, now trading around 22% lower than its high last month.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on construction and engineering business, GenusPlus Group (ASX:GNP), with an increased price target to $1.30 (previously $1.25). Bell Potter believes its acquisition of selected Tandem Corp’s assets and contracts can drive several key strategic benefits including increased maintenance revenue, greater diversification of end markets and the ability to target work on Australia’s 5G rollout.
- Bullish charting signals have been identified in Sezzle (ASX:SZL), HomeCo Daily Needs REIT (ASX:HDN) and Imdex (ASX:IMD) according to Trading Central.
Yesterday the Aussie share market closed at a record high, just over 7,500 points.
Overnight, shares were mixed, with broad selling over on Wall Street.
Following US equities, this morning the Aussie share market is set to open lower, with the futures suggesting a 0.2% fall.
What to watch today:
- Buy now, pay later company, Splitit (ASX:SPT) seems to be benefiting from Afterpay’s takeover announcement. Yesterday SPT closed 23% higher, while the leading BNPL stocks such as Z1P and APT closed with small gains.
- Companies set to report their earnings: Centuria Industrial REIT (ASX:CIP) are set to report their half year results and News Corp (ASX:NWS) with report their 2021 fourth quarter and full year earnings.
- In economic news, Balance of Trade data for June will be released today at 11:30am AEST.
- The most traded stocks by Bell Direct clients yesterday. They were Bank of Queensland (ASX:BOQ), Fortescue Metals (ASX:FMG) and Silver Lake Resources (ASX:SLR).
- The oil price has sunk 3.6% to US$68 a barrel, after US stockpiles increased.
- The gold price is up 0.8%, and iron ore is also trading 0.8% higher at US$182.50 per tonne.
Trading ideas:
- Bell Potter have a Speculative BUY recommendation on Comet Bridge (ASX:COI), with an increased price target to $0.18 (previously $0.13). Yesterday COI rallied 22% in afternoon trade, before closing higher 7.7%. COI’s capital growth is 98% in the year. However, Bell Potter believe are speculative on the stock, as the company only has prospective operations and cash flows, therefore recognising the volatility of returns.
- Bullish charting signals have been identified in Core Lithium (ASX:CXO), Splitit Payment (ASX:SPT) and South32 (ASX:S32), according to Trading Central.
The Aussie share market is likely to head back into record high territory today. The futures are suggesting a rise of 0.1%.
What to watch today:
- The iron ore price has stabilised. Spot iron ore prices rose 0.3%, and seaborne iron ore prices held steady after a 14% fall in the previous selling. This supported investors buying into BHP In New York overnight, helping BHP shares rise 1.7%. Therefore, (ASX:BHP) and other iron ore stocks on the ASX are likely to follow.
- The oil price fell slightly 0.3% to US$70.35.
- Consumer Confidence data to be released for August. Keep an eye on the reaction in consumer spending stocks.
- BWP Trust (ASX:BWP) released their earnings. Headline profit fell about 3% to $114 million, slightly under what the market expected of $114.7 million in profit.
- GUD Holdings (ASX:GUD) are set to report.
Trading Ideas:
- Laybuy Group (ASX:LBY) was reiterated as a Bell Potter Speculative BUY, with a much slimmer price target of $1.20. This implies over 100% share price growth in a year.
- Chalice Mining (ASX:CHN), Nearmap (ASX:NEA), and Warrego Energy (ASX:WGO) are all giving off bullish charting signals, according to Trading Central.
On Monday the Aussie share market rose 1.3%, supported by gains in Afterpay (ASX:APT) and Pilbara Minerals (ASX:PLS).
This morning, the futures are suggesting the market will fall 0.3%, peeling back from yesterday’s record high.
What to watch today:
- The iron ore spot price fell 3% and the iron ore seaborn price fell 14%, to its lowest level since April. This is due to China’s unexpected commitment to cutting steel production.
- The copper price fell 1%, while the oil price rose 0.3% to US$71.50.
- The RBA meet today, expected to hold rates at 0.1%. The focus will be on increasing the amount of bonds the RBA buys. Currently, the RBA is buying $100 billion bonds, with this program ending in September. After September, the RBA planned to decrease the amount of bonds bought each week from $5 billion to $4 billion. This may change given the current restrictions.
- Credit Corp Group (ASX:CCP) are set to release their earnings today.
Trading Ideas:
- Copper and gold producer, Aeris Resources (ASX:AIS) is a Bell Potter Speculative BUY stock, with a new price target of $25.50, implying 15% share price growth in a year.
- Zip (ASX:Z1P), Seven West Media (ASX:SWM), and Westgold Resources (ASX:WGX) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a 0.5% rise for the first day of trade in August.
What to watch today:
- US payment giant Square, will take over Afterpay (ASX:APT) for AU $39 billion. This values APT shares at $126.21, which is a 31% premium to Friday’s close at $96.66. The transaction is expected to be completed by Q1 2022.
- GUD Holdings (ASX:GUD) are set to report their earnings today.
- In economic news, the RBA meets tomorrow. Rates are expected to hold at 0.1%. The focus however, will be on bond buying.
- The iron ore price fell 0.7%, the copper price fell 1%, while the oil price fell slightly by 0.1%.
Trading Ideas:
- Kingfish grower and seller Clean Seas Seafood (ASX:CSS) was reiterated as a Bell Potter Speculative BUY, with a price target of $0.80, implying 46% share price growth in a year.
- ARB (ASX:ARB), EROAD (ASX:ERD) and Cararvon Petroleum (ASX:CVN) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market rose 0.3% this week (Mon-Thu) remaining in record high territory as the Mining sector charged ahead with better than expected company results and commodity price increases.
In this week’s wrap, Jessica covers:
- (0:23) How the Mining sector dug itself into a record high, rising 3%
- (1:44) Three Mining companies in the spotlight, up > 11% each
- (2:44) Three key themes to watch this reporting season
- (5:31) Bank stocks set to report a huge turnaround in earnings
- (6:20) Key reporting results & economic news to watch out for next week
There were mostly gains across the board yesterday. The market rose 0.5%, as three of Australia’s largest iron ore producers hit record prices.
Overnight US equities rose off the back of strong corporate earnings. All three major indices closed with gains. Robinhood debuted on the Nasdaq starting trade at $38 and closed its debut session at $34.82, 8.4% below the IPO price.
The Aussie share market is set to open higher, with the futures suggesting a 0.1% lift.
What to watch today:
- In economic news, the Producer Price Index (PPI) for the second quarter and Private Sector Credit for June will be released at 11:30am AEST.
- In local COVID-19 news, yesterday NSW recorded its worst day with 239 new cases. Further restrictions have been introduced for NSW local government areas of concern, including mandatory masks outside of the house and staying within a 5km radius.
- Watch Janus Henderson (ASX:JHG) after the company released positive second quarter results yesterday after the market close. JHG reported a 95% increase in operating income, and overnight its share price rose 6% in the US.
- In company news, Origin Energy (ASX:ORG) will report second quarter sales today and Mineral Resources (ASX:MIN) will release their quarterly result.
- The oil price jumped again, trading 1.4% higher at US%73 a barrel.
- Gold is also trading 1.1% higher, while iron ore is trading lower at US$213 per tonne.
Trading Ideas:
- Bell Potter maintain their BUY recommendation on Mader Group (ASX:MAD) after they released a strong 4th quarter update. MAS closed yesterday at $0.97, implying 40.6% share price growth in a year.
- Eagers Automotive (ASX:APE) is a Bell Potter BUY stock and Bell Potter have increased their price target to $18.75 (previously $17.50). The stock closed 2.7% higher yesterday, implying just over 14% share price growth in a year.
- Bell Potter also maintain their BUY recommendation on Gold Road Resources (ASX:GOR), after the company released their June quarter results. They closed yesterday at $1.30, implying just over 34% share price growth in a year.
- Bullish charting signals have been identified in Perseus Mining (ASX:PRU), De Grey Mining (ASX:DEG) and Ioneer (ASX:INR), according to Trading Central.
Overnight the S&P500 closed flat after the Fed kept its easy-money policies. The Dow Jones closed about 0.36% lower, while the Nasdaq closed up 0.7%.
Following the mixed session on Wall Street, the Aussie share market is set to bounce back after yesterday’s fall of 0.7%, to open 0.3% higher to 7,301 points.
Stay tuned, later today we will be releasing a full report on Rio Tinto (ASX:RIO)’s results.
What to watch today:
- On the COVID-19 front, NSW Premier Gladys Berejiklian extended the stay-at-home orders for another four weeks until August 28. Amid the lockdown extension news, Webjet (ASX:WEB), Qantas (ASX:QAN), Sydney Airport (ASX:SYD) and Flight Centre (ASX:FLT) all closed lower yesterday. However, keep in mind, travel companies are likely to go into recovery once restrictions ease.
- Today, Q2 import and export prices are set to be released at 11:30am AEST.
- Companies reporting today: Janus Henderson Group (ASX:JHG) is set to report its second quarter 2021 earnings and Fortescue Metals (FMG) will report its fourth quarter financial year production.
- Unibail-Rodamco-Westfield (ASX:URW) reported its half year results, which saw its net rental income dropped 26.2% compared with first half 2020 results.
- The oil price lifted about 1% toward the US$73 a barrel mark, after US inventories declined.
- The gold price lifted about 0.48%, shaking off initial declines following Powell flagging lingering risks to the US economy from the delta variant.
- Silver is trading 1.17% higher, while copper was down 1.47%, and the iron ore price traded down about 0.3% to US$214.
Trading ideas:
- After reporting a better-than-expected second quarter, Bell Potter has once again maintained its BUY recommendation on location-based technology company Life360 (ASX:360) and increased its price target to $9.50 (previously $9.25). Life360 closed 1% higher yesterday to $8.00, which implies about 19% share price growth.
- Bell Potter also maintained its BUY recommendation on software company Nitro Software (ASX:NTO) with an increased price target of $4.00 (previously $3.75). Nitro closed about 5% lower yesterday to $3.27, which implies about 22% share price growth.
- Bullish charting signals have been identified in Raiz Invest (ASX:RZI), Tinybeans Group (ASX:TNY) and Sunrise Energy Metals (ASX:SRL) according to Trading Central.
The Aussie share market will likely open lower, with the futures suggesting a fall of 0.3%.
What to watch today:
- Inflation data will be released at 11:30am. The market expects consumer prices to grow 3.8% year on year. If inflation is higher than expected, further selling in the market may be seen today.
- At the NSW press conference at 11am this morning, the Premier will likely announce an extension to Sydney’s lockdown. Stocks that will be impacted include Shopping Centres Australasia (ASX:SCP) and Vicinity Centres (ASX:VCX). Further selling is also expected in travel businesses, including Flight Centre (ASX:FLT) and Ingenia (ASX:INA).
- Life360 (ASX:360) reported better than expected earnings results.
- IGO (ASX:IGO) reported quarterly results with NPAT up 981% and free cashflow up 122%.
- Rio Tinto (ASX:RIO) is due to report today after the market close.
- The oil price holds around US$72 a barrel. The copper price continues to rise 0.4%, while the iron ore price fell slightly.
Trading Ideas:
- Ai-Media Technologies (ASX:AIM) is a Bell Potter BUY stock. It was upgraded with a new price target of $1.50, implying 63% share price growth in a year.
- QBE Insurance (ASX:QBE), Ampol (ASX:ALD) and Chimeric Therapeutics (ASX:CHM) are all giving of bullish charting signals according to Trading Central.
Yesterday, the Aussie share market reached its highest level of 7,418 points.
Today the futures are suggesting the Aussie share market will lift 0.3% or 19 points.
What to watch today:
- Australia awaits news on Victoria, South Australia and NSW lockdown restrictions.
- Virgin Money (ASX:VUK) are set to report their results today.
- Temple and Webster (ASX:TPW) reported earnings results this morning. TPW’s full year revenue is up 85% and their earnings (EBITDA) are up 141% in the year.
- Oil Search (ASX:OSH) have reported their quarterly results, with a 22% up in revenue.
- Oz Minerals (ASX:OZL) have also reported quarterly results, with upgraded full year production.
- The copper price surged over 4% to its highest level since June. The price was boosted by the news that China sold less reserves than expected.
- The iron ore price fell 0.4%, while the oil price rose 0.4% to US$72.18.
Trading Ideas:
- Fresh milk company Synlait Milk (ASX:SM1) was reiterated as a Bell Potter BUY, with an increased price target of $4.40, implying 29% share price growth in a year.
- Paladin (ASX:PDN), Neometals (ASX:NMT) and Redbubble (ASX:RBL) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a 0.3% lift, taking the market to another record all time high.
What to watch today:
- In economic news, inflation data will be released on Wednesday. It is expected to show a 3.8% rise in inflation over the year in the last quarter.
- The oil price lifted slightly to US$72, continuing to bounce back from last Monday’s fall.
- The copper price rose 2.7%, while iron ore rose over 1%. Following these gains, BHP in New York lifted 1.1%, so it is expected that Australian listed commodity stocks will also do well today.
- Mining and energy stocks given oil and iron ore rebounds.
Trading Ideas:
- Health club business Viva Leisure (ASX:VVA) was reiterated as a Citi BUY stock, with a slimmer $2.50 price target, implying 38% share price growth in a year.
- BrainChip (ASX:BRN), Damstra (ASX:DTC) and FireFinch (ASX:FFX) are all giving off bullish charting signals according to Trading Central.
The Aussie share market soared to a brand new record high this week (closing at 7,386 points on Thursday), before setting another record high on Friday. While Australia braces for further lockdowns, the US population continues to move more freely, and this has created two very different types of opportunities for investors.
In this week’s wrap, Jessica covers:
- (0:22) Lockdowns spelling good news for Healthcare & Consumer Staples
- (1:26) Why investors are picking Woolworths (ASX:WOW)
- (2:17) CIMIC (ASX:CIM) rising 10% as new work orders are above pre-pandemic levels
- (3:23) Medibank (ASX:MPL) benefitting as pay-outs drop while earnings rise
- (5:12) CSL (ASX:CSL) shares giving the market a shot in the arm
- (6:39) Next week's economic news that could shake up the market
Yesterday the Aussie share market closed at record high of 7,386 points after the market rose 1.1%.
This morning, the futures are suggesting the market will fall 0.2%.
What to watch today,
- The iron ore price is down 2%, pulling back for the second session. Stocks such as BHP (ASX:BHP) and Fortescue Metals (ASX:FMG) are expected to pull back.
- The oil price jumped 2% to US$71, helping energy stocks rebound from Monday’s sell off.
- Copper is up 1.5%, while coal prices dipped for the second day, peeling back off its decade high.
- The Services PMI Flash for July will be released today. The services sector was in growth territory prior to the lockdowns.
Trading Ideas:
- Zip (ASX:Z1P) is a Citi BUY with a $10.25 price target, implying 35% share price growth in a year.
- Bell Potter has reiterated Cluey (ASX:CLU) as a Speculative BUY stock, with a $1.70 price target, implying 50% share price growth in a year.
- Uniti Group (ASX:UWL) Adriatic Metals (ASX:ADT) and Alcidion (ASX:ALC) are all giving off bullish charting signals according to Trading Central.
This morning the futures are suggesting the Aussie share market will rise 0.9%.
What to watch today:
- It’s confirmed that Brisbane will host the Olympics in 2032. This means infrastructure will be built over the next 11 years to cater for the Olympic Games. Investors should watch engineering stocks such as Cimic (ASX:CIM) and Downer (ASX:DOW). Also watch construction stocks including Brickworks (ASX:BKW), Adelaide Brighton (ABC) and Boral (ASX:BLD).
- The oil price jumped 4% overnight, trading above US$70 – and likely to push higher.
- The iron ore price fell 0.5%, copper rose 0.4% and the coal price eased from its decade high, falling 1.3%.
Trading Ideas:
- Beach Energy (ASX:BPT) was upgraded by Bell Potter with a new $1.85 price target, implying 52% share price growth in a year. BPT is a BUY stock for Bell Potter, Macquarie and Credit Suisse.
- James Hardie (ASX:JHX), Redbubble (ASX:RBL) and Coda Minerals (ASX:COD) are all giving off bullish charting signals, according to Trading Central.
It was a positive session across European and US markets, with all major indices closing with gains.
The Aussie share market is set to open higher with the futures suggesting a 0.7% rise to 7,210 points.
What to watch today:
- Keep an eye on Oil Search (ASX:OSH). The company’s share price jumped, after they rejected a takeover bid with Santos (ASX:STO). While OSH’s share price jumped 6.3% yesterday, Santos closed almost 5% lower.
- Afterpay (ASX:APT) is looking to set up its own Financial Services License. APT announced their Money By Afterpay App rollout plan, which is the company’s new money and lifestyle app. This app is looking to be launched to customers in October.
- In local COVID-19 news, South Australia has joined NSW and Victoria in lockdown. At 6pm yesterday, Adelaide entered a weeklong lockdown as the delta variant spreads. The NSW Government also announced a weeklong lockdown for parts of the Central West.
- Retail Sales Data for June will be released today at 11:30am AEST.
- Tonight at around 6:30pm AEST it will be decided if Brisbane is successful in the bid to host the Olympic Games in 2032.
- The oil price is up 1.3%, following yesterday’s crash, trading at US$67.00.
- Coal continues to trade higher, while the gold price is trading 0.1% lower.
- Woodside Petroleum (ASX:WPL) was the most traded stock by Bell Direct clients yesterday. The stock was under pressure yesterday, as the oil price also tumbled.
- Australia and New Zealand Bank (ASX:ANZ) was in the green yesterday and was also one of the most traded, after the bank announced a $1.5 billion buy-back. Its shares closed with a 0.6% gain yesterday at $27.32.
Trading ideas:
- Bell Potter maintain their BUY recommendation on Senex Energy (ASX:SXY) with a $3.75 price target. Senex provide leverage to Australia’s gas market, where supply deficits are supporting high prices. SXY closed at $3.18 yesterday, implying 17.9% share price growth in a year.
- Bell Potter also maintain their BUY recommendation on Elders (ASX:ELD) at a $13.75 price target. The stock closed with a 3.2% gain yesterday at $11.68, implying 17.7% share price growth in a year.
- Bullish charting signals have been identified in Dropsuite (ASX:DSE), Telix Pharmaceuticals (ASX:TLX) and Australian Ethical Investment (ASX:AEF), according to Trading Central.
It was a volatile session over on Wall Street. The Dow Jones tumbled more than 700 points, that was its largest drop since October last year. This comes as the delta variant is spreading, causing COVID-19 cases in the US to rebound this month.
What to watch today:
- Today, the Aussie share market is set to drop sharply at the open, 1% lower, amid Wall Street retreating, oil collapsing and US Treasury yields sliding.
- The RBA Meeting Minutes will be released at 11:30am today AEST. Given NSW and Victoria are in lockdown, and the RBA previously flagged it will reduce the amount of bonds it buys from November, many are now expecting the central bank to flip on that decision and increase support again.
- Today, BHP (ASX:BHP) is set to report its fourth quarter FY21 production numbers and Sydney Airport (ASX:SYD) will release its June 2021 sales.
- The most traded stocks yesterday by Bell Direct clients, were Evolution Mining (ASX:EVN) which fell nearly 9% yesterday, after several investment houses trimmed their targets to EVN’s share price including Morgan Stanley & Credit Suisse. Also, we saw Bell Direct clients trading energy services group Valmec (ASX:VMX), its shares jumped 25% higher yesterday after the company received an acquisition offer.
- The oil price fell more than 6% lower, below US $70 a barrel, after OPEC ministers agreed to increase oil supply from August and as the delta COVID-19 variant threatens global demand.
- Coal prices continue to track upwards, trading at almost $150 a tonne.
- While the iron ore price continues to trade around US$219.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on Australia’s largest accident repair group, AMA Group (ASX:AMA), with a decreased price target of $0.65 (previously $0.70). AMA closed about 1% lower yesterday to $0.52, which implies about 24% share price growth.
- Bell Potter also maintained its BUY recommendation on Cooper Energy (ASX:COE) with a price target of $0.45. The stock closed about 4% lower yesterday to $0.24, which implies a massive 86% share price growth.
- Bullish charting signals have been identified in Deterra Royalties (ASX:DRR), Mirvac Group (ASX:MGR) and Mayne Pharma Group (ASX:MYX) according to Trading Central.
Please note: Given the current restrictions in Sydney, we will be delivering our market updates via audio format. We will revert back to the usual video format once restrictions ease. We thank you for your understanding.
The Aussie share market is set for a negative start to the week. The futures are hinting a 0.5% pull back, following all three US major indices closing lower.
Watch to watch today:
- Given the increased restrictions in Melbourne and Sydney, Australia is likely to see economic activity fall in the September quarter by 1.4% from July to September.
- Sydney’s new restrictions include a pause on all construction, with 250,000 construction workers told they cannot work. Additionally, non- essential retail stores are closed and Sydney’s public transport has been halved with timetables reverting to Sunday schedules.
- As the construction industry takes a big hit, watch Boral (ASX:BLD), Brickworks (ASX:BKW), CSR Limited (ASX:CSR), and CIMIC (ASX:CIM) and Fletcher Building (ASX:FBU).
- Energy stocks are expected to make strong rebounds this week, while banking will pull back.
- Commonwealth Bank (ASX:CBA) are offering loan deferrals and Westpac (ASX:WBC) are offering interest free temporary overdrafts.
- Brisbane may potentially host 2032 Olympics. The announcement will be made on Wednesday. This will be positive news for infrastructure, engineering, travel and tourism and hospitality stocks.
- The iron ore price rose 0.5%, copper rose 2.4% and coal prices surged to almost $150.00 a ton, to their highest level in a decade.
Trading Ideas:
- Citi has reiterated Afterpay (ASX:APT) as a HOLD with a $125.00 price target.
- Neometals (ASX:NMT), archTIS (ASX:AR9) and Strike Resources (ASX:SRK) are all giving off bullish charting signals, according to Trading Central.
Despite lockdowns, Aussie investors have been keeping busy, buying into sectors that will do well on the other side of COVID-19. Plus, local Buy Now Pay Later (BNPL) stocks lost their mojo after the industry got a shake-up.
In this week’s wrap, Jessica covers:
- (0:17) Post-lockdown optimism helps the Utilities sector rise the most
- (0:37) Spark Infrastructure Group (ASX:SKI) lifting 17%, after receiving a fresh vote of confidence
- (1:01) The companies set to benefit as exports to China and the iron ore price surge
- (2:52) The impact of Apple's plan to enter the BNPL industry
- (4:02) An in-depth look at bullish lithium stock: Orocobre (ASX:ORE)
Yesterday growing COVID-19 concerns across the nation weighed down on the market, as well as news that China’s economic growth for the second quarter was slightly below expectations of 8% growth, it rose 7.9%.
Today, the futures are suggesting the Aussie share market will open 6 points lower.
What to watch:
- Melbourne entered a sudden 5-day lockdown, while NSW Premier Gladys Berejiklian says she expects todays reported cases to be higher than yesterdays.
- The unemployment rate fell to 4.9%. This is the lowest unemployment rate in a decade. However, labour force figures in the coming months will be interesting and we can expect some volatility given the data will include the current NSW lockdown.
- Travel stocks continue to come under pressure. While most of the travel stocks closed in the red yesterday, today we will all be watching Sydney Airport (ASX:SYD)’s share price, after the company formally rejected the takeover offer of $22 billion from a consortium of infrastructure investors.
- Telstra (ASX:TLS) is on watch off the back of competition with Optus in an auction for low- band spectrum coming up in November. Low- band spectrum allows company’s such as Telstra to carry mobile data across greater distances in regional Australia, which is important for Telstra to reach regional communities.
- The oil price is down 2.4%, the gold price is edging 0.1% higher, while iron ore is currently trading 0.3% higher at US$218.
- One of the most traded stocks yesterday by both Bell Direct and our advised clients was Westpac (ASX:WBC). WBC was recently downgraded to a HOLD by Bell Potter, with an increased price target of $26.50. After a large jump in impairment benefits, Westpac closed 1.1% lower yesterday, falling the most out of the 4 major banks.
- Bell Direct clients were also trading Fortescue Metals (ASX:FMG). The past week has seen confidence in iron ore miners, as well as the broader resources sector. Yesterday FMG closed over 2% higher at $25.72, nearing its January all-time record high of $26.40.
Trading ideas:
- Bell Potter maintain their BUY recommendation on technology company Life360 with an increased price target of $9.25 (previously $7.75). Life360 closed yesterday at $7.83, implying just over 18% share price growth in a year.
- Bell Potter also maintain their BUY recommendation on Whitehaven Coal (ASX:WHC), with an increased price target of $2.50, with optimism in the current strength in thermal coal markets. WHC closed yesterday at $2.07, implying 21% share price growth in the year.
- Bullish charting signals have been identified in Magnis Technology (ASX:MNS), Brainchip (ASX:BRN) and Rhythm Biosciences (ASX:RHY), according to Trading Central.
According to US Federal Reserve Chair, Jerome Powell, inflation “will likely remain elevated in coming months” before “moderating.”
Apple shares jumped 2.4% after reports that the company had ramped up production of its next-generation iPhones by 20%.
This morning, the futures are suggesting the Aussie share market will dip slightly, about 0.14% or 10 points.
What to watch today:
- Locally, on the COVID-19 front, NSW lockdowns were extended an additional two weeks until Friday the 30th of July. Western Australia impose an immediate border change with Victoria. This requires anyone arriving into WA from Victoria having to self-quarantine for 14 days and be tested on arrival. This comes as Victoria recorded a spike in local COVID-19 cases yesterday. With this in mind, continue to watch travel stocks, such as Flight Centre (ASX:FLT), Qantas (ASX:QAN), Sydney Airport (ASX:SYD) and Webjet (ASX:WEB), which will continue to come under pressure.
- There are two new threats in the local Buy Now Pay Later market. Firstly, Apple has been working on a new service, dubbed internally as Apple Pay Later, that will allow its users to pay for any Apple Pay purchase in instalments over time. Secondly, PayPal have scrapped its late payment fees altogether, a fee that Afterpay managed to profit $70 million dollars’ worth in 2020. The news weighed down on the local tech sector, which fell 2.7%. Zip (ASX:Z1P) and Afterpay (ASX:APT) were hit the most, both down about 10%. Apple’s entry now casts doubt over Afterpay’s US push, which is believed to be one of its main growth initiatives. So continue to keep an eye on local BNPL stocks today.
- In economic news, consumer confidence data was released yesterday, and the index gained 1.5%, holding up despite the sharp fall in NSW. This comes as both Victoria and WA recorded strong bounce backs from COVID-19 related disruptions in June.
- Today, investors will get an update on the unemployment rate. Currently 5.1%, with expectations that this will fall to 5%.
- The oil price traded lower after reports that Saudi Arabia and the United Arab Emirates had reached a compromise that should unlock an OPEC deal to boost global oil supplies.
- The gold price rose about 1%.
- The iron ore price fell about 0.15% from its record high level yesterday.
Trading ideas:
- Bell Potter has upgraded its recommendation on Nufarm (ASX:NUF) from a HOLD to a BUY with a price target of $5.30. The stock closed up 0.67% to $4.51, which implies about 17% share price growth.
- Syrah Resources (ASX:SYR), Ecograf (ASX:EGR) and Orocobre (ASX:ORE) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting the market will rise 0.06%.
What to watch today:
- NSW Premier Gladys Berejiklian is expected to announce an extension of Sydney’s lockdown. Yesterday the government announced that small and medium NSW businesses will be eligible for weekly cash payments of up to $10,000. Workers affected will receive $375 to $600 a week.
- Consumer confidence data for July will released today. This data is expected to be weak as lockdowns continue.
- The iron ore price rose up 0.4% to US$218, hitting a record all time high. The iron ore price has gained 40% this year, amid surging demand for steel from India.
- Flight Centre’s (ASX:FLT) shares rose 1.7%. That’s its biggest share price jump in seven days. It wasn’t enough to move FLT out of the range it’s been trading in since May – under the $16 mark. Most brokers think FLT will stay around these levels till restrictions ease.
Trading Ideas:
- Adacel Technologies (ASX:ADA) was reiterated as a Bell Potter BUY with a $1.25 price target, implying 28% share price growth in a year.
- Ioneer (ASX:INR), NOVONIX (ASX:NVX) and Carbon Revolution (ASX:CBR) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to rise 0.3%, with bank stocks set to rally following Wall Street.
What to watch today:
- Today the Federal Government will be announcing financial support for the NSW lockdown.
- The iron ore price rose 0.7% overnight to US$217.00. The iron ore price is being supported by an increasing demand for steel globally. Watch iron ore stocks such as BHP (ASX:BHP).
- In economic news, Business Confidence data for June and Home Sales data will be released today.
- The most traded stocks by Bell Direct clients yesterday were CSL (ASX:CSL) and Mineral Resources (ASX:MIN).
Trading Ideas:
- Citi has a SELL recommendation on Wesfarmers (ASX:WES), with a $45.00 price target. Citi expects WES shares to fall 22%. Meanwhile, Credit Suisse recommends (ASX:WES) as a HOLD stock, downgrading their price target from $58.03 to $57.23.
- Vulcan Energy Resources(ASX:VUL), 4dMedical (ASX:4DX), and Fisher and Paykel Healthcare (ASX:FPH) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market is set to rally 1.1% or 76 points.
Watch to watch today:
- Traders are cautious as Sydney’s lockdown could possibly be extended until mid-August. Meanwhile, restrictions in Western Australia have ended.
- The oil price (WTI) rose 2.2% on Friday, to its highest level since 2019. Oil stocks will likely charge up today.
- The iron ore price fell 0.3% to US$216.00, however it is now back in record territory. In New York on Friday, BHP rose 1.4%, so Aussie iron ore stocks could follow.
- In economic news, building permits for May are out today, business and consumer confidence data will be released tomorrow and Wednesday, and unemployment figures for June will be released on Thursday.
Trading Ideas:
- De Grey Mining (ASX:DEG) is a Bell Potter Speculative BUY stock, with an increased price target to $1.71, implying 36% share price growth in a year.
- Citi has downgraded its price targets on both Afterpay (ASX:APT) and Zip Co (ASX:Z1P), amid increased global competition. Afterpay’s target has been reduced to $125.00, and Zip Co’s target has been reduced to $10.25.
- Vmoto (ASX:VMT), Macarthur Minerals (ASX:MIO) and Unibail-Rodamco-Westfield (ASX:URW) are all giving off bullish charting signals according to Trading Central.
This week, investors have been weighing up localised lockdowns and travel bubbles reopening, which put travel and tourism stocks back in the spotlight.
In this week’s wrap, Jessica covers:
- (0:15) Industrials in a league of their own, up 4.5%
- (0:28) Sydney Airport (ASX:SYD) flies up 34%, after receiving a $22 billion takeover offer. What could move SYD next?
- (1:47) Pfizer vaccine imports set to triple, and investors in travel stocks love it
- (2:57) Earnings forecasts are being upgraded & why this is good news
- (4:30) Two travel stocks to consider: Qantas (ASX:QAN) & Flight Centre (ASX:FLT)
It was a volatile session over in the US, amid global economic recovery concerns.
Japan declared a state of emergency in Tokyo, with its upcoming Olympics to be held with no spectators.
Also causing recovery concerns is the rebound in cases due to the COVID-19 variants many countries are currently experiencing.
This morning the Aussie share market looks set to end the week lower, with the futures suggesting the market will fall 0.66% at the open.
What to watch today:
- Zip (ASX:Z1P) saw its share rise as much as 15% yesterday amid speculation that rival Swedish BNPL provider, Klarna had acquired a 4% stake in the business.
- Seven West Group (ASX:SWM) climbed 4% higher after it took its stake in building materials company Boral (ASX:BLD).
- RBA Governor Lowe spoke yesterday to the Economic Society of Australia, where he reiterated the central bank’s position that conditions for a rate rise will not be met until 2024.
- NSW COVID-19 cases hit a record 38 new cases yesterday, with the Federal Government pledging an extra 300,000 doses of vaccines to be distributed to NSW, noting that this won’t affect supplies for other states. Australia now sits at about 8% fully vaccinated, and 25.72% of the population having their first dose.
- The oil price is trading up about 1.5% to US$73 a barrel, following positive US inventory data, which showed a much bigger drop than expected in crude and gasoline inventories.
- The gold price eased around US$1,800.
- The iron ore price fell 0.82% to US$216.
Trading ideas:
- Bell Potter has maintained its BUY rating on telemedicine company Doctor Care Anywhere (ASX:DOC) with a price target of $1.70. DOC closed 2% higher yesterday to $0.90, which implies about 93% share price growth in a year.
- Lynas Rare Earths (ASX:LYC), BUBS Australia (ASX:BUB) and MyDeal.com.au (ASX:MYD) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a modest lift of 0.2% or 11 points.
What to watch today:
- The NSW Treasury estimates that Sydney’s three week lockdown will cost the NSW economy $2.5 billion, with hospitality hit the hardest. Long term investors could take advantage of stocks pulling back as a result. Watch Endeavour Group (ASX:EDV).
- The RBA Governor will give a speech on the labour market and interest rates today at 12:30pm AEST.
- The oil price (WTI) briefly hit a new six year high before pulling back to US$72.00.
- The iron ore price rose 0.2% to US$214.00.
Trading Ideas:
- Speciality chemical business DGL Group (ASX:DGL) was reiterated as a Bell Potter BUY with an increased price target of $1.65, implying 18% share price growth in a year. DGL was listed this year on the ASX.
- Medadviser (ASX:MDR), Ingenia (ASX:INA) and Altium (ASX:ALU) are all giving off bullish charting signals according to Trading Central.
Yesterday, the RBA held the cash rate at 0.1%, where it is likely to stay until 2024. After the announcement, the Aussie share market continued to fall until the close, ending 53 points lower.
Today, the Aussie share market is set to open flat. The futures are suggesting a fall of 11 points or 0.2%, down to 7,162 points.
What to watch today:
- Sydney Airport (ASX:SYD) has seen a lot of movement this week. On Monday, SYD’s share price jumped almost 34% after they announced an all cash $22.6 billion buy out offer from infrastructure investors.
- Mineral Resources (ASX:MIN) announced they will be drilling its own natural gas supply in Perth. The project aims to provide energy security for the company’s future mining operations at a lower cost. Yesterday MIN closed 0.4% higher.
- NSW Premier Gladys Berejiklian is set to extend the current lockdown, originally set to end this Friday.
- The oil price is trading 1.9% lower, gold is trading 0.2% higher and the iron ore price is trading 2.4% higher.
- The most traded stocks by Bell Direct clients were Woodside Petroleum (ASX:WPL), Brainchip (ASX:BRN), and Australia and New Zealand Bank (ASX:ANZ).
Trading ideas:
- Bell Potter have upgraded their recommendation on Uniti Group (ASX:UWL) from a HOLD to a BUY, with an increased price target of $3.60 (previously $3.20).
- Citi have a BUY recommendation on Ramsay Heath Care (ASX:RHC) with a $76 price target.
- Bullish charting signals have been identified in Cyprium Metals (ASX:CYM), Dropsuite (ASX:DSE) and CleanSpace Holdings (ASX:CSX) according to Trading Central.
The Aussie share market is set to rise 0.3% or 19 points, ahead of the RBA meeting today.
What to watch today:
- The RBA meeting minutes will be a huge focus today, given the lockdowns across the nation. The RBA previously committed to buying $200 billion of bonds, in the aim of keeping corporate interest rates low and supporting borrowing by businesses. Investors will be watching whether the RBA reduces buying bonds, as this will increase interest rates for companies borrowing.
- Tech stocks could see selling pressure today. Watch Afterpay (ASX:APT), Zip Co (ASX:Z1P), Appen (ASX:APX) and Altium (ASX:ALU).
- Banking stocks will be in the spotlight today and could see profit taking this week, amid the RBA’s announcement.
- The Australian Banking Association (ASX:ABA) today announced an independent review of the Banking Code of Practice, aiming to ensure banks meet consumer and community expectations.
- The oil price jumped to US$76.00, its highest in almost 3 years. This is due to a gas leak that caused a fire in the Gulf of Mexico, as well as the cancellation of a meeting with OPEC and other oil producers.
- The copper price rose 1.6%.
Trading Ideas:
- Ardent Leisure (ASX:ALG) was reiterated as a Citi BUY stock, with a $1.30 price target, implying 33% share price growth in the year.
- Inoeer (ASX:INR), Scentre Group (ASX:SCG) and Strike Energy (ASX:STX) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to start the week flat.
As COVID-19 cases in NSW increase, many are questioning if Sydney’s two week lockdown will be extended on Friday.
What to watch today:
- The Trans -Tasman bubble will resume today. Residents from South Australia, ACT, Tasmania and Victoria will be allowed to travel to New Zealand, provided they have not visited a designated hotspot.
- In company news, Tabcorp (ASX:TAH) announced it is to demerge its Lotteries and Keno into an ASX listed business. The gambling industry has been successful amid the rise of lockdown leisure, which supports (ASX:TAH) shares. (ASX:TAH) shares are up 33% this year. Other gambling companies to watch include Aristocrat Leisure (ASX:ALL) and Jumbo Interactive (ASX:JIN).
- In economic news, the RBA are set to meet tomorrow.
- On Thursday, the US Fed are set to release their last meeting minutes.
- The iron ore price rose 0.3% to US$212.00. On Wall Street, BHP (ASX:BHP) and Rio Tinto (ASX:RIO) traded higher. The Aussie listed stocks are expected to follow.
- The gold price rose 0.3% to US$1,787.
- The oil price traded at US$75.00, at its highest level since October 2018.
- The copper price rose 1%.
Trading Ideas:
- Imdex (ASX:IMD) was reiterated as a Bell Potter BUY with a $2.35 target, implying 18% yearly upside.
- Transurban (ASX:TCR), Syrah Resources (ASX:SYR) and Musgrave Minerals (ASX:MGV) are all giving off bullish charting signals according to Trading Central.
Step aside EOFY volatility, August reporting season is just around the corner, and it's looking like it's going to be a showstopper. Plus there's a new tech darling in town, and it's got the attention of some big celebrity names...
In this week’s wrap, Jessica covers:
- (0:22) Telcos stealing the show up 2.3% following Telstra's (ASX:TLS) announcement
- (1:02) Staples back in vogue: Metcash (ASX:MTS) reporting record sales
- (1:57) EOFY rebalancing pushing two stocks to the top of the leaderboard
- (2:37) Why Collins Foods (ASX:CKF) fell 13% despite record earnings
- (3:52) A new celebrity stock? The rise of Life360 (ASX:360)
The Aussie share market is set to rebound, with the futures suggesting a 0.4% lift to 7,205 points.
US equities had a positive run, with all three major benchmarks closing higher.
What to watch today:
- Zip (ASX:Z1P) announced their partnership with fintech company Propell Holdings (ASX:PHL), making the company the first BNPL service on the Propell platform. Yesterday Zip’s share price rose 1.7% and Propell’s share price jumped just over 42%.
- Increases in superannuation payments came into effect yesterday, bumping up from 9.5 to 10%. This sees an additional $233 in super accounts for 6.7 million Aussies.
- New home loan data will be released at 11:30am AEST.
- Keep an eye on travel stocks as Sydney, Perth, Brisbane and Darwin are in lockdown and state borders have also been closing.
- The oil price rose 2.1% and is trading at US$75 a barrel. The gold price is up 0.4%, copper is down 1.1% and the iron ore price is trading 1.3% lower.
- CSL Limited (ASX:CSL) was one of the most traded stocks by our advised clients yesterday. The conflicting news headlines regarding health precautions for young people taking the AstraZeneca vaccine have correlated to CSL’s fall.
- Bell Direct clients were also trading Australia and New Zealand Bank (ASX:ANZ), Nuix (ASX:NXL), and BetMakers Technology (ASX:BET).
Trading ideas:
- Bell Potter maintain their BUY recommendation on The a2 Milk Company (ASX:A2M) and maintain their $8.50 price target, with confidence in the company’s long-term potential in their distribution points in China.
- Bell Potter also maintain their SELL recommendation on infection prevention company Nanosonics (ASX:NAN), due to likely downgrades from its $130 million consensus revenue for FY22.
- Bullish charting signals have been seen for Fenix Resources (ASX:FEX), Red River Resources (ASX:RVR) and Humm Group (ASX:HUM), according to Trading Central.
The Aussie share market closed out its best financial year in over 30 years on Wednesday, with shares rebounding despite a negative start to the week’s trading.
This morning, the Aussie share market looks set to start the New Financial Year slightly lower, with the futures suggesting the market will open down 0.08%.
What to watch today:
- In economic news, Australia’s Balance of Trade data for May will be released today at 11:30am AEST.
- On the COVID-19 front, the Prime Minister has extended no-fault indemnity insurance to GPs who administer the AstraZeneca vaccine to younger age groups. So far, 26% of Australians have received their first dose. With only 3.47% fully vaccinated.
- The oil price rose on Wednesday, trading at about US$73.55 a barrel, after data showed US crude stockpiles were shrinking and an OPEC report foresaw an undersupplied market this year.
- The gold price rose 0.45%, still on track for its worst month in more than 4 years.
- The iron ore price continues to trade at US$214.00.
Trading ideas:
- Bell Potter has a BUY rating on location-based information technology company Life360 (ASX:360), increasing its price target by 11% to $7.75 (previously $7.00). That’s a 15% premium to the share price.
- Bell Potter also has a BUY rating on technology-based translation services business Straker Translations (ASX:STG), with a price target of $2.40. STG closed about 2% down yesterday, which implies 24% share price growth.
- Prospect Resources (ASX:PSC), Musgrave Minerals (ASX:MGV) and Clinuvel Pharmaceuticals (ASX:CUV) are all giving off bullish charting signals according to Trading Central.
US equities reached a new record high yesterday.
US American house prices grew 14.9% in April, beating expectations.
This morning the Aussie share market is set to open higher, for the final day of the financial year.
What to watch today:
- Across Australia, capital cities are in lockdown and states are closing their borders, contributing to the markets pull back form its record high. As panic buying takes off again, Woolworths (ASX:WOW) shares are up 4% and Metcash (ASX:MTS) shares are up 6%. As COVID-19 testing increases, healthcare stocks are also doing well, including Sonic Healthcare (ASX:SHL) which is up 3%.
- Today marks the final day of the Financial Year. During this time, investors often take profits from stocks doing well, and buy underperforming stocks. With this in mind, Redbubble (ASX:RBL) and Kogan (ASX:KGN) are down 30% this year, however both shares rose 5% this week to date. Other stocks to consider include: Zip (ASX:Z1P) and Collins Food (ASX:CKF).
- NSW small businesses will be able to apply for grants for lost revenue as a result of lockdowns. Commercial businesses are also being encouraged to negotiate rent prices.
- A ban on exporting mixed plastics will come into play tomorrow. Watch Amcor (ASX:AMC) and Pact Group (ASX:PGH).
- The iron ore price fell 0.4% to US$214.00, gold fell 0.1% to US$1,761.00, nearing an 11 week low, and the oil price is back over US$73.00.
Trading Ideas:
- Alpha HPA Ltd (ASX:A4N), was reiterated as a Bell Potter Speculative BUY with an increased $0.83 target, implying 63% yearly upside.
- FYI Resources (ASX:FYI), Chimeric Therapeutics (ASX:CHM), and Advanced Human Imaging (ASX:AHI) are all giving off bullish charting signals according to Trading Central.
As of today, 23% of the world’s population have received their first dose of the COVID-19 vaccine, according to Our World in Data.
Overnight, big tech names Zoom, Facebook and Peloton all increased over 4%.
Today, the futures are suggesting a negative day for the Aussie share market, given there are two days until the EOFY and three of Australia’s capital cities are in lockdown.
What to watch today:
- With two days until the EOFY, institutional investors are rebalancing their portfolios to sell stocks that have done well over the year, and buy those that have underperformed. With this in mind, stocks that are up 40 to 90% this year include mining stocks Chalice Gold Mines (ASX:CHN), Pilbara Minerals (ASX:PLS) and Codan (ASX:CDA). Banking stocks include Virgin Money (ASX:VUK) and Westpac (ASX:WBC), and building stocks include Reece Group (ASX:REH) and Boral (ASX:BLD). Uniti Group (ASX:UWL) is also one to watch.
- COVID-19 restrictions and lockdowns are currently in place in Perth, Sydney and Darwin, so watch travel, tourism, hospitality and retail stocks.
- Prime Minister Scott Morrison has announced that anyone under 40 years old can receive the AstraZeneca vaccine.
- The iron ore price continued its recovery rising 0.4% to US$215.00.
- The oil price is down to US$72.00 a barrel.
Trading Ideas:
- Bapcor (ASX:BAP) was upgraded by Citi overnight with a new $9.55 price target.
- Genetic Signatures (ASX:GSS) was reiterated as a Bell Potter Speculative BUY with a slimmer $2.20 price target.
- VGI Partners (ASX:VGI), Kogan (ASX:KGN) and Rudbubble (ASX:RBL) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set for a slow start to the week, with the futures suggesting the market will rise 0.1%.
What to watch today:
- With three days to go until the EOFY, selling/portfolio adjustments continue.
- The City of Sydney is currently in lockdown. So all eyes are on travel, hospitality and retail stocks.
- Watch Endeavour Group (ASX:EDV), after it demerged from Woolworths (ASX:WOW) on Friday.
- The oil price rallied above US$74 a barrel, after rising for its fifth week to its highest level since October 2018.
- Gold rose 0.2% and the iron ore price rose 0.4% to $214.
Trading Ideas:
- Aeris Resources Ltd (ASX:AIS) is a Bell Potter BUY stock, with an upgraded price target to $23.50.
- Resolute Mining (ASX:RSG), Mincor Resources (ASX:MCR) and Galan Lithium (ASX:GLN) are all giving off bullish charting signals according to Trading Central.
With the end of financial year just days away, many investors are rebalancing their portfolios. Temporary setbacks for select stocks create opportunities. Plus, an agricultural stock to consider following a rise in almond demand.
In this week’s wrap, Jessica covers:
- (0:28) The Tech sector erasing its yearly loss, rising 3.8%
- (1:00) Why investors are rushing back into Afterpay (ASX:APT)
- (2:08) Why ARB's (ASX:ARB) next results could be strong
- (3:08) One of 2021’s greats, Codan (ASX:CDA) falling 8% on profit taking
- (4:00) Tapping into rising demand: the case for Select Harvests (ASX:SHV)
US equities rose overnight after President Joe Biden settled on an infrastructure deal, which is to include $579 billion in spending. All three US equity benchmarks closed higher.
Yesterday, the ASX200 closed in the red, down 23 points, in a session where Woolworths (ASX:WOW) demerged from Endeavour Group (ASX:EDV) who own liquor chains Dan Murphy’s and BWS.
However, following the positive night in the US, the Aussie share market is set to open 0.7% higher.
What to watch today:
- Travel companies as they continue to underperform due to the current uncertainly amid rising COVID-19 cases in NSW. Premier Gladys Berejiklian reintroduced restrictions this week, and Queensland has shut their border to NSW. So keep an eye on travels stocks such as Flight Centre (ASX:FLT), as well as Qantas (ASX:QAN) which was down almost 2% yesterday.
- The gold price dipped 0.2% as the mixed Fed outlook puts investors on edge, copper was also down 0.2%, and iron ore is trading 0.02% lower.
- The oil price however, pushed higher, up 0.3%, so watch energy producers such as Woodside Petroleum (ASX:WPL) and Santos (ASX:STO).
- The most traded stocks by Bell Direct clients yesterday were Woolworths (ASX:WOW), Afterpay (ASX:APT) and CSL Limited (ASX:CSL).
Trading ideas:
- Bell Potter have reiterated their BUY recommendation on Acrow Formwork and Construction Services (ASX:ACF), with an increased price target at $0.46. Bell Potter’s positive view towards ACF is based on their leverage to civil infrastructure markets and their transition away from the commoditised residential scaffolding market.
- Bell Potter have also initiated Tulla Resources (ASX:TUL) as a Speculative BUY. They are a gold development and mineral exploration company. TUL closed yesterday at $0.46 implying 97.8% share price growth.
- Kogan (ASX:KGN), Appen (ASX:APX) and Alcidion Group (ASX:ALC) are all giving off bullish charting signals according to Trading Central.
Yesterday, the Aussie share market fell 0.6% to about 7,299 points.
Today, the Aussie share market looks set to fall again, with the futures suggesting the market will open 0.4% lower. This comes as NSW COVID-19 cases continuing to rise and the enforcement of new restrictions taking place, with the potential for further restrictions to be set in place in today’s update.
What to watch:
- Following New Zealand enforcing a 72 hour pause on the NSW/ New Zealand travel bubble, Air New Zealand (ASX:AIZ) shares fell 1.7% and Sydney Airport (ASX:SYD) shares fell 2.2%.
- Oil is holding at its record of US$73 a barrel, as US supplies tightened and the US dollar retreated, making it less expensive for buyers holding other currencies.
- While rate hike concerns were eased by the US Fed yesterday, it wasn’t enough to lift the Gold price, which trades slightly lower, about 0.1%.
- The iron ore price is trading higher approximately 0.2%.
- The most traded stocks by Bell Direct clients and advised clients were Commonwealth Bank (ASX:CBA) and ANZ Bank (ASX:ANZ). Bell Direct clients also traded TechnologyOne (ASX:TNE).
Trading ideas:
- Bell Potter have a BUY rating on Adacel Technologies (ASX:ADA) with a price target of $1.25. ADA is a global technology company that develops and implements air traffic management systems and air traffic control stimulation. ADA closed up about 4% yesterday, which implies 37% share price growth.
- Bell Potter also have a BUY rating on Australia’s leading avocado grower, Costa Group Holdings (ASX:CGC) with a price target of $4.30.
- K-TIG (ASX:KTG), Osteopore (ASX:OSX) and Compumedics (ASX:CMP) are all giving off bullish charting signals according to Trading Central.
US equities rose overnight, with all three indices closing with gains.
However, the Aussie share market is set for a flat start, with the futures suggesting the market will fall 0.1%.
What to watch today:
- As NSW COVID-19 cases rise, restrictions are likely to remain in place until the 30th June. The travel bubble between New Zealand and NSW has been put on pause for 72 hours. Watch Sydney Airport (ASX:SYD) and Air New Zealand (ASX:AIZ).
- Uranium stocks are in the limelight as Prime Minister Scott Morrison lays the groundwork for a nuclear energy election plan. Keep an eye on Paladin Energy (ASX:PDN), Boss Energy (ASX:BOE) and Deep Yellow (ASX:DYL).
- The oil price is holding at US$73.00 a barrel, at its highest level in 3 years.
- Copper holds steady after a volatile week last week, after falling 7%.
- The iron ore price gained 0.3%.
Trading Ideas:
- Propel Funeral Partners (ASX:PFP) was upgraded as a Bell Potter BUY with a new $4.25 target, implying a 13% share price growth in a year.
- West African Resources (ASX:WAF), Emeco Holdings (ASX:EHL) and Senex Energy (ASX:SXY) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting the market will rise 1.2%.
What to watch today:
- NSW has abolished stamp duty costs on electric vehicles (EVs) in a bid to boost EV sales, as part of handing down its state budget today. All eyes will be on companies involved in lithium production, including Galaxy Resources (ASX:GXY), Pilbara (ASX:PLS) and Lake Resources (ASX:LKE).
- Victoria has invested $5 million into Australia’s first locally manufactured mRNA vaccine. All eyes on CSL Limited (ASX:CSL).
- The oil price rose above US$73.00 a barrel overnight.
- The copper price rebounded 1.4% on Monday.
- The iron ore price last traded at US$217.00 after falling 1.6%.
Trading Ideas:
- Bega Cheese (ASX:BGA) was reiterated as a Bell Potter BUY with a $7.35 target, implying 21% share price growth in a year.
- Oneview Healthcare (ASX:ONE), Caravel Minerals (ASX:CVV) and Alcidion (ASX:ALC) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting the market will fall 1.5%.
What to watch today:
- Australian Retail sales data is out today for May.
- Today marks the 8th last trading day before the EOFY.
- Lumber prices hit a record high in May of US$1,700 per thousand board feet. Watch lumber and wood producers, including Big River Industries (ASX:BRI), Wesfarmers (ASX:WES) and Midway (ASX:MWY).
- The oil price holds at US$71.84, up by 0.3%.
- The iron ore price fell 1.6% and trades at US$217.
- The copper price fell to a two month low, losing 1.2% and falling 7% over the week, as China is expected to sell their reserves in copper, aluminum and zinc.
- Most traded stocks by Bell Direct clients yesterday: Galaxy Resources (ASX:GXY) and Chalice Mining (ASX:CHN).
Trading Ideas:
- Avita Therapeutics (ASX:AVH) was reiterated as a Bell Potter BUY with a $9.80 target, implying 75% share price growth in a year.
- Bubs Australia (ASX:BUB), Xero (ASX:XRO) and AMP (ASX:AMP) are all giving off bullish charting signals according to Trading Central.
The Aussie share market smashed another record high this Wednesday, hitting 7,406 points. With a bullish outlook for the US economy, and better than expected Australian employment data, it's no wonder we're seeing high after high after high.
In this week’s wrap, Jessica covers:
- (0:32) The eight big stock movers of the week
- (1:10) What's driving markets
- (2:15) Three technical indicators that suggest the market rally is likely to continue
- (2:42) Trading volumes hitting an 18-year low as caution sets in
- (3:54) Agriculture: the next big trading theme?
- (5:45) Two key economic data points out next week
Overnight US tech stocks claimed back some lost territory following a two day sell off.
This morning the Aussie share market is eyeing a positive day, with the futures suggesting a 0.5% lift, which means the market is on track for its 6th weekly gain.
What to watch today:
- Traders and investors continue to readjust their portfolios with 9 more trading days until the EOFY.
- Today tech stocks will likely rally higher following the Nasdaq’s 0.9% gain overnight.
- Altium (ASX:ALU) provided a trading update and reiterated its FY21 guidance. Bell Potter have a HOLD recommendation on ALU, with a $37.50 price target.
- Sydney Airport (ASX:SYD) provided a Traffic update for May, noting 1.4 million passengers passed through its airport. Morgan Stanley reiterated (ASX:SYD) as a BUY stock yesterday.
- The oil price fell slightly from its multi-year high, trading at US$71.00.
- The iron ore price eased 2.3% lower from its record high and now trades at US$217.00.
- The most traded stocks by Bell Direct clients yesterday: BrainChip (ASX:BRN) and Nuix (ASX:NXL).
Trading Ideas:
- Cluey (ASX:CLU)was reiterated as a Bell Potter Speculative BUY with a $1.70 target, expecting 76% share price growth in a year.
- Money3 Corporation (ASX:MNY) was initiated as a Bell Potter BUY with a $3.70 target.
- Lake Resources (ASX:LKE), Bigtincan (ASX:BTH) and Polynovo (ASX:PNV) are all giving off bullish charting signals according to Trading Central.
Well the US Federal Reserve have kept rates unchanged, but raised expectations of at least two increases in interest rates by the end of 2023.
China announced yesterday that they would release national reserves of aluminium, copper and zinc, to stabilise commodity prices. This weighed down on miners, however the ASX200 still closed higher.
Despite US equities falling overnight, the Aussie share market is set to open higher, with the futures suggesting the market will rise by 7 points.
What to watch today:
- The RBA bulletin will be released this morning at 11:30am AEST, with announcements on the unemployment and participation rates.
- Keep an eye on Coles (ASX:COL) as they hold their virtual strategy day today, where they will provide an update on their refreshed strategy, with the potential for an update on their sales.
- The oil price is down 0.8%, gold is down 2.4%, copper is down 1.5% and iron ore is trading 0.2% lower.
- The most traded stocks by Bell Direct clients yesterday were Northern Star Resources (ASX:NST), BHP (ASX:BHP) and Flight Centre (ASX:FLT).
Trading ideas:
- Bell Potter have reiterated their BUY recommendation on Imdex (ASX:IMD) with an increased price target of $2.35 (previously $2.20).
- Straker Translations (ASX:STG), Credit Corp Group (ASX:CCP) and Adore Beauty Group (ASX:ABY) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting the market will fall 0.2%.
Traders and investors are exercising caution awaiting the Fed’s monthly announcement.
What to watch today:
- Oil is up to US$72.12, at its highest level in almost three years.
- Iron ore hit another record high at US$221.00.
- Australia and the UK agree to a free trade deal, with tariffs being phased out over a decade.
- Australian farmers eye off another big winter crop. Watch Elders (ASX:ELD), Graincrop (ASX:GNC), Australian Agriculture Co (ASX:AAC) and Ridley Corp (ASX:RIC).
Trading Ideas:
- DGL Group (ASX:DGL) was initiated as a Bell Potter Buy with a $1.50 price target.
- The a2 Milk Company (ASX:A2M), MA Financial Group (ASX:MAF) and Hearts and Minds Investments (ASX:HM1) are all giving off bullish charting signals, according to Trading Central.
On the Aussie COVID-19 vaccine front - Novavax’s COVID-19 vaccine candidates showed strong efficacy against the virus. This sparks good news for Australia’s vaccine strategy – as the federal Government has made the Novavax shot one of the key parts of its rollout and has 51 million doses placed on order.
Given, the news of the Novavax vaccine, as well as the reasonably positive start to Wall Street’s week, the Aussie share market looks set to lift 0.80% or 56 points higher to 7,368 points if you go by the futures.
US eco data out this week includes retail sales data for May, which is out today at 10:30pm AEST and on Thursday, the Fed will announce their interest rate decision.
What to watch today:
- In economic news, today the RBA releases its meeting minutes, and house price index data is out. On Thursday, the unemployment rate for May will be announced and RBA Governor Lowe will deliver a speech titled ‘From recovery to expansion’.
- The oil price held steady after hitting a 2-year high, while the gold price slipped as investors fear the US Fed may outline a path for scaling back its expansive monetary policy at its two-day meeting this week.
- The most traded stocks by Bell Direct clients last Friday were ANZ Bank (ASX:ANZ), Westpac (ASX:WBC) and Queensland Pacific Metals (ASX:QPM).
Trading ideas:
- Bell Potter have reiterated their BUY recommendation on Domino’s Pizza (ASX:DMP), with an increased price target of $132 (previously $122). Domino’s closed about 1% up last Friday to $115.30, which implies 14.4% share price growth.
- Bell Potter has also increased its price target on Portman’s and Peter Alexander owner Premier Investments (ASX:PMV) to $26.10 (previously $25). PMV expects its Earnings before Interest and Tax to range between $340 - $360 million, which is 5-11% ahead of Bell Potter’s estimate of $344 million. This positive expectation is off the back of a strong sales performance, strong online sales growth, and strong cost control. However, with its share price currently at $27.44, that implies a negative 4.9% share price growth, therefore Bell Potter have a HOLD rating on the stock.
- IOUpay (ASX:IOU), Lynas Rare Earths (ASX:LYC) and Cyprium Metals (ASX:CYM) are also giving off bullish charting signals according to Trading Central.
The Aussie share market hit three record highs this week as the Tech sector turned up the watts. However, the market now tracks sideways as it holds its breath for the Fed's interest rate announcement. In this week’s wrap, Jessica covers:
- (0:7) Old school Tech stock gains while Financial stocks get hit by EOFY portfolio adjustments
- (0:22) Altium (ASX:ALU) rising 27% as the standout stock of the week
- (1:22) Why the ASX200 is likely to rally over the medium term
- (2:22) Two major themes emerging that investors should consider
- (4:40) Why consider semiconductor companies
The Aussie share market is set to open higher, with the futures suggesting the market will rise 0.1%.
All three US indices rose overnight, despite an inflationary reading that saw consumer prices rise more than expected.
What to watch today:
- Food and beverage companies will be in focus, as Victoria ended its lockdown overnight and hospitality ventures reopen. Watch Wesfarmers (ASX:WES) and Coles (ASX:COL).
- Australia and Singapore could start a travel bubble if more Australians are vaccinated and transmissions fall. Watch travel stocks including Flight Centre (ASX:FLT), Qantas (ASX:QAN), Webjet (ASX:WEB) and Adacel (ASX:ADA).
- Demand for iron ore is surging. The iron ore price could rise from its current level at US$214 to US$300. Keep an eye on iron ore stocks.
Trading Ideas:
- Citi has a Buy recommendation on Zip (ASX:Z1P) with a $10.90 price target.
- Adriatic Metals (ASX:ADT), Nitro Software (ASX:NTO) and Shopping Centres Australasia Property Group (ASX:SCP) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting the market will fall 0.04% to 7,272 points.
Investors are cautious pending the release of the US Inflation report for May, which will be released tonight 10:30pm AEST.
What to watch today:
- Australia’s Consumer Inflation Expectations will be released at 11am this morning.
- Watch Brickworks (ASX:BKW), after they just hit a record high at $23.54. The company announced they expect record earnings of $100 million from a Joint Venture Industrial Property Trust.
- Keep an eye on travel stocks as Melbourne’s restrictions are set to ease from midnight tonight.
- The oil price is down 0.4%, gold is down 0.2% and copper is down 0.6%, while iron ore is trading 1.1% higher.
- The most traded stocks by Bell Direct clients yesterday were: Iluka Resources (ASX:ILU), Fortescue Metals (ASX:FMG) and Australia and New Zealand Bank (ASX:ANZ).
Trading ideas:
- Bell Potter have maintained their BUY recommendation on Coronado Global Resources (ASX:CRN), with a $1.10 price target (previously $0.95).
- Bell Potter have maintained their BUY recommendation on Whitehaven Coal (ASX:WHC) with an increased price target of $2.40 (previously $2.25).
- Bell Potter also have a BUY recommendation on Doctor Care Anywhere (ASX:DOC). They have lowered their price target on DOC from $1.95 to $1.70.
- Consistent with Bell Potter, Trading Central are also bullish on Whitehaven Coal (ASX:WHC). Lynas Rare Earths (ASX:LYC) and Marley Spoon (ASX:MMM), are also giving off bullish charting signals according to Trading Central.
Yesterday the Aussie share market hit a brand new record high, reaching 7,316 points.
Today the Aussie share market is set to hit another all time high, with the futures suggesting the market will rise 0.14%.
What to watch today:
- The tech sector is set to make a comeback. Watch WiseTech (ASX:WTC) and Appen (ASX:APX).
- Also watch cyber security stocks, including Rhipe (ASX:RHP), Tesserent (ASX:TNT) and Archtis (ASX:AR9).
- The oil price holds above US$70 a barrel, at its highest level in over two years.
Trading Ideas:
- Within the energy sector, Bell Potter has Buy recommendations on Beach Energy (ASX:BPT), Byron Energy (ASX:BYE) and Cooper Energy (ASX:COE).
- UBS recommended oil stocks include Oil Search (ASX:OSH), Origin Energy (ASX:ORG), Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
- Tesserent (ASX:TNT), NEXTDC (ASX:NXT) and Kalium (ASX:KLL) are all giving off bullish charting signals according to Trading Central.
After a mixed session overnight on Wall Street, the futures are suggesting the Aussie share market will open 0.1% higher.
What to watch today:
- Australia’s Business Confidence data will be released today and Consumer Confidence data to be released tomorrow.
- US inflation data to be released on Thursday.
- The oil price fell 0.1% to US$69.20 a barrel, iron ore is trading 0.5% lower and gold rebounded to $1,901.
- Most traded stock by Bell Direct clients yesterday: Altium (ASX:ALU). And the most traded stock by our advised clients: VanEck Vectors Australian Equal Weight ETF (ASX:MVW).
Trading Ideas:
- Austal Limited (ASX:ASB) was reiterated as a Citi BUY with a $3.30 price target.
- Oneview Healthcare (ASX:ONE), Energy Resources (ASX:ERA) and Orica (ASX:ORI) are all giving off bullish charting signals according to Trading Central.
US equities lifted on Friday, after the key May jobs report was released. The US economy added 559,000 jobs in May, coming in slightly lower than the estimate of 671,000. Despite the miss, it still showed a healthy rebound in the labor market and boosted confidence in the economic comeback. The unemployment rate fell to 5.8% from 6.1%, which was better than the estimate of 5.9%.
Tech shares rebounded on Friday following the jobs report miss and the US 10-year treasury yield falling. We saw Zoom up about 5% and Tesla up around 4.5%.
The Aussie share market is set to reset its record high at the open, with the futures suggesting the market will lift 0.10% or 7 points higher to 7,300 points.
What to watch today:
- In economic news this week, tomorrow Business Confidence is out for May– the question will be if levels will rise above the record high 26 points set in April. Then on Wednesday, Consumer Confidence is out for June where the focus will be on whether Victoria’s lockdown will pull confidence levels back from their current level of 113.1.
- On Friday the Oil price hit an intra-day high of US$72 a barrel, for the first time since 2019. This was off the back of OPEC discipline and demand hopes. Also boosting Oil, was a slowdown in talks between the US and Iran, which reduced expectations of a rise in Iranian oil supply.
- Iron ore eased below $US210 a tonne given weaker sentiment in China’s steel market.
- The Gold price rose 1% off the back of softening bond yields.
- The most traded stocks by Bell Direct clients last Friday were: Steadfast Group (ASX:SDF), Telstra (ASX:TLS) and Westpac (ASX:WBC). Our advised clients most traded stocks were also Steadfast and Telstra, as well as iShares Core Composite Bond ETF (ASX:IAF).
Trading Ideas:
- Bell Potter have reiterated their BUY recommendation on iron ore company BCI Minerals (ASX:BCI), with an increased price target of $0.69 (previously $0.57). BCI closed 2.5% up last Friday to $0.42, which implies a huge 64% share price growth.
- Bell Potter has also maintained their BUY recommendation on pharmaceutical company Mayne Pharma (ASX:MYX), with a price target of $0.56.
- Pilbara Minerals (ASX:PLS), Venturex Resources (ASX:VXR) and QBE Insurance Group (ASX:QBE) are all giving off bullish charting signals according to Trading Central.
After 15 months of regaining losses, this week the Aussie share market hit a historical high, largely thanks to better than expected economic news. With the tax time sell-off approaching, investors are scouting the market for new opportunities, so this week, we've done the heavy lifting for you...
In this week’s wrap, Jessica covers:
- (0:07) Flying high - the ASX200's great pickup
- (1:17) Why oil stocks accounted for 60% of the ASX200's top performers this week and what this means for investors
- (2:42) A top performer for the year: Codan (ASX:CDA)
- (3:57) Key economic news to be across next week
- (5:27) What's behind a2 Milk's (ASX:A2M) recent bounce back
The tech heavy was Nasdaq down around 1%, after tech stocks came under pressure following President Joe Biden proposing a minimum corporate tax rate of 15%, which would lift the overall tax rate to 28%. This saw Tesla shares fall 5.3%.
Despite all three US benchmarks closing lower, the Aussie share market is set to open higher, with the futures suggesting the market will rise 0.03% to 7,265 points.
What to watch today:
- Prime Minister Scott Morrison has announced a Natural Disaster Payment scheme that will be applied to lockdowns that have lasted longer than 7 days.
- Moving to commodities, the Oil price holds steady around US$69 a barrel, after two straight days of gains. The Gold price retreated around 2%. Silver and Platinum slipped around 4% each. While the Iron Ore price continues to trade higher, rising about 1.5% and is up about 33% YTD.
- The most traded stocks by Bell Direct clients yesterday were Australia and New Zealand Bank (ASX:ANZ), National Australia Bank (ASX:NAB) and VanEck Vectors Australian Property ETF (ASX:MVA).
Trading ideas:
- Bell Potter have reiterated their BUY recommendation for Access Innovation (ASX:AIM), with an unchanged price target at $1.40. AIM announced a 3-year extension of their live captioning contract with Sky News and Bell Potter’s optimistic view on is based on its ability to monetise its industry leading platform.
- Bell Potter have downgraded their recommendation on Telecommunication Services business Uniti Group (ASX:UWL) from a BUY to a HOLD, with an increased price target to $3.20.
- SmartPay Holdings (ASX:SMP), Lendlease Group (ASX:LLC) and Afterpay (ASX:APT) are all giving off bullish charting signals, according to Trading Central.
Yesterday, the ASX200 closed at a new record high for the first time in history, at a 1.1% gain.
Overnight, all three US indices moved up modestly by 0.1%.
This morning the Aussie share market is set to reach a brand new record high, with the futures suggesting the market will rise 0.2%.
What to watch today:
- In economic news, Retail Trade Data is out today for April.
- Balance of Trade data set to be released 11:30am AEST.
- The Oil price moved over its two- year high to US$68.77 a barrel.
- The Iron Ore price rose 3%, trading at $207.50 a tonne.
- The Gold price rose modestly to US$1,911.
Trading Ideas:
- Worley (ASX:WOR) is a Citi BUY with a $12.60 price target, and Macquarie has a BUY on the stock, with a $12.00 price target.
- Superloop (ASX:SLC), Charter Hall Group (ASX:CHC), and FYI Resources (ASX:FYI) are all giving off bullish charting signals, according to Trading Central
The Aussie share market is set to open higher, with the futures suggesting the market will rise 0.2%.
What to watch today:
- The 15 day moving average has just nudged above the 30 day moving average. This indicates a technical uptrend is forming. But, as the moving averages lines are virtually on top of each other, the market could go either way from here.
- In economic news, GDP data will be released today.
- The RBA forecasts GDP for the full year to be 4.75%. Banks expect unemployment to fall to 5% this year. Bond yields will likely rise.
- Iron ore price rose 4.1%, heading back to its all time high. Watch Mineral Resources (ASX:MIN).
- Most traded stocks by Bell Direct clients yesterday: Fortescue Metals (ASX:FMG) & Magnetite Mines (ASX:MGT).
Trading Ideas:
- GenusPlus Group (ASX:GNP) had its price target upgraded by Bell Potter, with a new $1.25 target, following yesterday’s 6% jump.
- BUBs Australia (ASX:BUB), Ava Risk Group (ASX:AVA) Atomos (ASX:AMS) are all giving off bullish charting signals according to Trading Central.
Aussie equities managed to extend their monthly run of gains to 8 months in May. That’s the longest stretch in 14 years, despite yesterday’s slight dip given Melbourne’s COVID-19 outbreak spread, as well as Nuix (ASX:NXL) shares tumbling 17.8%.
The Aussie share market looks set to open 0.43% lower, amid a lack of direction from overseas, with both the US and UK markets closed for holidays.
Watch to watch today:
- The RBA holds its monthly interest rates decision meeting with rates expected to hold at 0.1%.
- The Oil price rose on Monday, with the WTI crude trading around US$67 a barrel, boosted by prospects of strong fuel demand in Europe and China. Investors now anticipate the OPEC meeting this week for supply guidance.
- The Gold price continues to hold firm above the key US$1,900-level.
- The Iron Ore price bounced in line with Chinese steel prices.
- The most traded stocks by Bell Direct clients yesterday: Computershare (ASX:CPU), PPK Group (ASX:PPK) and Andromeda (ASX:ADN). And the most traded stocks by our advised clients were Healius (ASX:HLS), Betmakers Technology Group (ASX:BET) and Coles (ASX:COL).
Trading Ideas:
- Bell Potter have reiterated their BUY recommendation for the second largest private provider of death services in Australia and New Zealand, Propel Funeral Partners (ASX:PFP) with an increased price target of $4.15 (previously $3.50). Yesterday, PFP closed 8.5% higher to $3.70, which implies about 12% share price growth.
- Bell Potter has also maintained their BUY recommendation for technology hardware and equipment business, EROAD (ASX:ERD), with an increased price target of $6.05 (previously $5.62).
- Genex Power (ASX:GNX), Novatti Group (ASX:NOV) and Access Innovation Holdings (ASX:AIM) are all giving off bullish charting signals according to Trading Central.
The Aussie share market hit a record high last Friday closing at 7,179 points, beating the record set back in February 2020.
Today, the Aussie share market is set to follow Wall Street’s lead with the futures suggesting the market will lift 0.08% to 7,181. Melbourne’s virus outbreak could cast a shadow however.
What to watch:
- Economic news out this week: RBA meeting tomorrow, economic growth for the quarter will be released on Wednesday and on Thursday the balance of trade, that’s Australian imports vs. exports data is out for April.
- The most traded stocks by Bell Direct clients last Friday were: TechnologyOne (ASX:TNE), Imugene (ASX:IMU) and Rio Tinto (ASX:RIO).
- Oil prices fell slightly on Friday, but closed higher for the week following strong US economic data and expectations of a demand rebound.
- The Gold price rose 0.38%, popping above US$1,900 per ounce. This comes as US consumer prices surged in April and boosted its appeal as an inflation hedge.
Trading ideas:
- Bell Potter have reiterated their BUY recommendation on funeral homes and cemetery operator InvoCare (ASX:IVC) with a reduced price target of $12.20 (previously $12.80). IVC closed about 3% higher on Friday to $10.55, which implies 16% share price growth.
- Bell Potter has maintained their BUY recommendation on integrated poultry producer Ingham’s Group (ASX:ING), with a price target of $4.30.
- Kina Securities (ASX:KSL), Premier Investments (ASX:PMV) and Brainchip (ASX:BRN) are all giving off bullish charting signals according to Trading Central.
The Aussie share market defied the odds this month, rising 1% so far. Lithium stocks are back in full focus, as governments draw new environmental battle lines, and key car manufacturers like VW, GM, BMW and Tesla scale up electric vehicle (EV) operations.
In this week’s wrap, Jessica covers:
- (0:33) What we can expect for June based on historical trends
- (1:05) Investors buying the Tech stock dip
- (1:32) What's behind the rise of Pilbara Minerals (ASX:PLS) & Galaxy Resources (ASX:GXY)
- (3:36) Why governments are pushing EVs
- (4:29) A lithium battery ETF that's up 80% year on year
- (5:33) The huge economic news week ahead
US equities advanced overnight following better than expected jobs data.
Yesterday, the major miners pushed the Aussie share market higher, managing to close with a gain, amid Victoria going back into a snap 7-day lockdown.
Today following the US overnight, the Aussie share market is set to open higher this morning, with the futures suggesting the market will rise 0.82% to 7,148 points.
What to watch today:
- AGMs will be held today for Appen (ASX:APX), InvoCare (ASX:IVC), and Electro Optic Systems (ASX:EOS).
- Select Harvest (ASX:SHV) are set to report their half year results today.
- Keep an eye on Qantas (ASX:QAN) as the company continues to back the vaccine rollout. They are considering offering frequent flyer points and travel vouchers as an incentive to get the COVID-19 vaccine.
- Domino’s Pizza (ASX:DMP) major competitor Pizza Hut owner Yum! Brands, has made a deal to buy Dragontail Systems for $94 million. This could potentially end DMP’s relationship with the tech company, with Domino’s shares falling 4.9% yesterday.
- The Oil price is up 1.47%, so energy producers could end the week higher. Gold is up 0.02% and Copper is up 3.02%. The Iron Ore price has eased slightly from its record high this month, down 0.25%.
Trading ideas:
- Bell Potter have reiterated their BUY recommendation on Costa Group Holdings (ASX:CGC) with a $4.60 price target, previously at $5.10.
- Bell Potter have also reiterated their BUY recommendation on Volpara Health Technology (ASX:VHT), with an unchanged price target of $1.80.
- Intega Group (ASX:ITG), Mader Group (ASX:MAD) and Bionomics (ASX:BNO) are all giving off bullish charting signals according to Trading Central.
All three US benchmarks rose slightly overnight following US shares linked to the economic reopening lifting.
The Aussie share market is set to follow Wall Street’s lead with the futures suggesting the market will lift 0.04% to 7,093.
What to watch:
- Private Capital Expenditure data will be released today at 11:30am.
- Fisher & Paykel Healthcare (ASX:FPH) released its full year results this morning with net profit up 82%.
- AGMs today include Spark Infrastructure (ASX:SKI), Costa Group Holdings (ASX:CGC), Coronado Global Resources (ASX:CRN).
- The most traded stocks by Bell Direct clients yesterday were PPK Group (ASX:PPK), Kogan (ASX:KGN) and Imugene (ASX:IMU).
- The Oil price lifted slightly, about 0.05% off the back of stronger demand outlook as US inventories fell, while the Gold price eased below US$1,900 following a rebounding dollar and US Treasury Yields dimming its appeal. And Silver is trading down 1%.
Trading ideas:
- Bell Potter have maintained their BUY recommendation on media company, IVE Group (ASX:IGL), with a price target of $1.70.
- Bell Potter have also maintained their BUY recommendation on intellectual property company QANTM IP (ASX:QIP) with a price target of $1.55, implying about 44% share price growth.
- Adairs (ASX:ADH), Hazer Group (ASX:HZR) and Noxopharm (ASX:NOX) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting a 0.5% fall.
What to watch today:
- The iron ore price fell from US$217 to US$200. Watch Fortescue Metals (ASX:FMG), Mineral Resources (ASX:MIN) and Magnetite Mines (ASX:MGT).
- Whitefield Areas (ASX:WHF) goes ex- dividend today.
- Aristocrat Leisure (ASX:ALL) and CSL Limited (ASX:CSL) set to go ex- dividend on Friday.
- BrainChip Inc (ASX:BRN) and Viva Energy Group (ASX:VEA) to hold their AGMs today.
- The most traded stocks by Bell Direct clients yesterday: Link (ASX:LNK), Premier Investment (ASX:PMV) and Appen (ASX:APX). The most traded stocks by advised clients yesterday: Western Areas (ASX:WSA), Link (ASX:LNK) and Premier Investments Ltd (ASX:PMV).
Trading Ideas:
- Bell Potter have reiterated their Speculative Buy recommendation on Aroa Biosurgery (ASX:ARX), with a $2.00 price target.
- Super Retail Group (ASX:SUL), Bendigo and Adelaide Bank (ASX:BEN) and Deep Yellow (ASX:DYL) are all giving off bullish charting signals, according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a rise of 0.3%.
What to watch toady:
- Tech stocks are expected to rise for the 4th day, continuing on an uptrend. Watch Afterpay (ASX:APT).
- Copper price rose 1%.
- Coal stocks are back in focus, as the coal price is at a 3 year high.
- Amcor (ASX:AMC) to go ex- dividend.
- Technology One (ASX:TNE) set to report company results today.
- Most traded stocks by Bell Direct clients yesterday: Fortescue Metals Group (ASX:FMG), Kogan (ASX:KGN), and Commonwealth Bank (ASX:CBA). And the most traded stocks by our advised clients: CLS Limited (ASX:CLS), Magellan Global Fund (ASX:MGF) and Betashares Legg Mason Australian Bond (ASX:BNDS).
Trading Ideas:
- Synlait Milk (ASX:SM1) was reiterated as a Bell Potter Buy with a $3.85 price target.
- Healthia (ASX:HLA), Nick Scali (ASX:NCK) and Eclipx Group (ASX:EXC) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to fall, with the futures suggesting the market will open 0.1% lower.
What to watch today:
- Coal futures are trading at their highest levels since 2018, so keep an eye on Coronado Global Resources (ASX:CRN).
- Oil stocks will be in focus, gaining 3% to $63.72 a barrel, as a storm in the Gulf of Mexico is expected to restrict supply.
- Gold stocks are in focus, trading higher for the 7th session.
- Iron ore rises again to US$200.
- Elders Limited (ASX:ELD) and Centuria Capital Group (ASX:CNI) go ex-dividend this week.
- Aristocrat Leisure (ASX:ALL) and Select Harvests (ASX:SHV) set to report company results today.
- In economic news, construction work completed for the quarter is released on Wednesday and private sector spending data is released for the quarter on Thursday.
- Most traded stocks by Bell Direct clients on Friday: Tyro Payments (ASX:TYR), Fortescue Metals Group (ASX:FMG) and Kogan (ASX:KGN).
Trading Ideas:
- Life360 (ASX:360) has been reiterated as a Buy by Bell Potter with a $7.00 price target.
- Galan Lithium (ASX:GLN), Empired (ASX:EPD) and Bank of Queensland (ASX:BOQ) are all giving off bullish charting signals according to Trading Central.
With the end of financial year (EOFY) approaching, investors are rebalancing their portfolios. Quantitative traders watch on as the market teeters on a technical sell signal, which could pull the market back further if activated.
In this week’s wrap, Jessica covers:
- (0:25) Two key EOFY considerations
- (1:47) Investors buying the dip, into Tech
- (2:02) Artificial intelligence giant Appen (ASX:APX) rising 25%
- (2:41) Why it's worth keeping an eye on Aristocrat Leisure (ASX:ALL) & Eagers (ASX:APE)
- (4:32) Economic news to watch out for next week
- (4:45) Trading ideas: Virgin Money (ASX:VUK), Afterpay (ASX:APT)
After a three-day losing streak, US equities made a comeback. Today, following the US, the Aussie share market is set to open higher, with the futures suggesting the market will rise 0.38% to 7,042 points.
What to watch:
- New data from the ABS shows that the Australian economy is in a better than expected economic position post the pandemic, as the unemployment rate fell 5.5%.
- Results of the Markit Manufacturing PMI and Australian Retail Sales will be released.
- Qantas Airways (ASX:QAN) has announced two year wage freezes and that they’re offering redundancies to their international cabin crew. A few hundred jobs will be cut from Qantas’ international workforce in the hope of recovering from a $16 billion deficit caused my travel restrictions.
- Adelaide Brighton Cement (ASX:ABC), Sydney Airport (ASX:SYD) and Dicker Data (ASX:DDR) hold their AGMs today.
- The most traded stocks by Bell Direct clients yesterday were: Australia and New Zealand Bank (ASX:ANZ), Macquarie Group (ASX:MQG), and National Australia Bank (ASX:NAB).
- The Oil price dropped again, it fell 2.24%. So keep an eye on energy producers such as Santos (ASX:STO). The fall comes as traders have been selling oil amid the news of the potential removal of Iranian sanctions on crude oil exports.
- The Gold price rose 0.41%, Copper is down 1.12% and Iron Ore is down 0.38%.
Trading ideas:
- Bell Potter has maintained its BUY recommendation on Australian Pharmaceutical Industries (ASX:API), following Pfizer’s decision to revert back to a wholesaler distribution model later this year, with an unchanged price target of $1.50.
- Codan (ASX:CDA), Cash Converters International (ASX:CCV) and Shaver Shop Group (ASX:SSG) are all giving off bullish charting signals, according to Trading Central.
It was a wild session overnight on Wall Street after the Bitcoin price plunged causing Tech shares to come under pressure.
Despite Wall Street’s fall, the Aussie share market is set to open slightly higher, with the futures suggesting the market will lift 0.06%.
What to watch today:
- Unemployment data will be released this morning, with the market expecting the unemployment rate to hold at 5.6%, the lowest rate since April 2020. Given the expiry of JobKeeper and seasonal adjustment factors, it’s believed that there is a higher-than-usual risk of an unexpected outcome in this jobs result.
- Company results out today include Auckland International Airport (ASX:AIA), Infratil (ASX:IFT), Serko (ASX:SKO), United Malt Group (ASX:UMG) and Webjet (ASX:WEB).
- Today, Eagers Automotive (ASX:APE) and G8 Education (ASX:GEM) hold their AGMs.
- The Oil price dropped more than 3% off the back of renewed demand concerns as COVID-19 cases in Asia rise, and fears of rising inflation continue.
- The Gold price retreated as the dollar and US Treasury yields rose.
- The most traded stocks by Bell Direct clients yesterday: Macquarie (ASX:MQG), Vanguard Australian Shares Index ETF (ASX:VAS) and ANZ Bank (ASX:ANZ).
Trading ideas:
- Bell Potter has increased artificial intelligence company, Appen’s (ASX:APX) price target by 8% to $14.25, which is an 8% premium to the share price and they maintain its Hold recommendation.
- Bell Potter have updated their view on Helloworld Travel (ASX:HLO), reducing their price target from $2.60 to $1.95, and its Hold rating remaining unchanged.
- Vita Group (ASX:VTG), Aurelia Metals (ASX:AMI) and Talga Group (ASX:TLG) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open 1.1% lower, following Wall Street overnight.
The Australia government pushes for reusable, recyclable and compostable plastics.
What to watch today:
- Resolute Mining (ASX:RSG) is the best performer in the ASX200 this month, up 29%.
- Watch iron ore as China plans to set up exploration and production facilities. Iron ore stocks have been trading at a record high. Watch Fortescue Metals (ASX:FMG), Mineral Resources (ASX:MIN), Magnetite Mines (ASX:MGT), Aeris Resources (ASX:AIS) and BCI Minerals (ASX:BCI).
- The Federal Government greenlighted a $600 million Gas fired power station to be built in the NSW Hunter Valley, so keep an eye on AGL Energy (ASX:AGL).
- The Australian Government wants all plastics to be reusable, recyclable or compostable by 2025. So keep an eye on packing stocks like Amcor PLC (ASX:AMC), Orora (ASX:ORA), Pact Group Holdings (ASX:PGH) and Pro- pac Packaging (ASX:PPG).
- US President Joe Biden is pushing for electric-vehicle production. A $174 billion EV plan is urging automakers to build zero-emission vehicles in the US.
- Webjet (ASX:WEB) to report company results today.
- AGMs being held today: A.P. Eagers Limited (ASX:APE) and G8 Education (ASX:GEM).
- In economic news, consumer confidence will be released at 11:30am AEST.
- The most traded stocks yesterday: Nuix (ASX:NXL), Kincore Copper (ASX:KCC) and Macquarie Group (ASX:MQG).
Trading Ideas:
- Bell Potter have upgraded their recommendation on Lovisa Holdings (ASX:LOV) to a BUY, with a $15.50 price target.
- Medusa Mining (ASX:MML), Virgin Money (ASX:VUK), and Empired (ASX:EPD) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher, the futures suggesting a 0.2% gain.
End of financial year adjustments continue to take place, as investors are moving out of tech and into banking and mining.
What to watch today:
- The Oil price rose 1%, Gold rose 1.3% and Copper gained 1.3%, while Iron Ore rebounded 2.3%. Watch Aeris Resources (ASX:AIS), BCI Minerals (ASX:BCI) and Zeta Resources (ASX:ZER).
- James Hardie (ASX:JHX) is set to report company results today.
- RBA meeting minutes to be released today.
- The most traded stocks yesterday: Commonwealth Bank (ASX:CBA), Macquarie Group (ASX:MQG), and Afterpay (ASX:APT).
Trading Ideas:
- Incitec Pivot (ASX:IPL) was upgraded by Citi to a BUY with an increased price target of $2.90.
- Agriculture and real estate group Elders (ASX:ELD), was upgraded by Citi and Bell Potter. Citi’s 12 month target for (ASX:ELD) is $13.40 and Bell Potter’s new target for (ASX:ELD) is more bullish at $13.75.
- Westgold Resources (ASX:WGX), BWX (ASX:BWX) and Primewest Group (ASX:PWG) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher, with the futures suggesting a 0.7% gain.
Investors continue to buy into tech stocks, after last weeks pull back.
What to watch today:
- Watch Tech stocks: Afterpay (ASX:APT),Xero (ASX:XRO) and Seek (ASX:SEK).
- The Iron Ore price continues to pull back. Watch Fortescue Metals Group (ASX:FMG), Magnetite Mines (ASX:MGT), Mineral Resources (ASX:MIN), BCI Minerals (ASX:BCI), and Champion Iron (ASX:CIA).
- Incitec Pivot Limited (ASX:IPL), Temple & Webster Group (ASX:TPW) and Elders (ASX:ELD) are set to report today.
- This week: RBA meeting minutes to be released on Tuesday and Consumer Confidence released on Wednesday. Watch JB Hi-Fi (ASX:JBH), Afterpay (ASX:APT), Harvey Norman (ASX:HVN) and Breville Group (ASX:BRG). In addition, unemployment data will be released on Thursday and April retail sales will be released on Friday.
- Most traded stocks from Friday included Xero (ASX:XRO) and Woodside Petroleum (ASX:WPL).
Trading Ideas:
- Bell Potter have reiterated a speculative Buy recommendation on Avita Medical (ASX:AVH), dropping their price target to $10.50.
- Nick Scali (ASX:NCK), Ansell (ASX:ANN) and Integral Diagnostics (ASX:IDX) are all giving off bullish charting signals according to Trading Central.
Despite the Aussie share market falling 1.4% Monday to Thursday, the market is trading 7% higher so far this year. As the economy shifts further into expansion phase, interest rate fears have seen investors continue to rotate out of Tech and hunt for new opportunities.
In this week’s wrap, Jessica covers:
- (0:40) Why investors may continue to move out of Tech
- (1:18) What to expect in this economic growth phase
- (1:49) The companies investors are avoiding
- (2:47) 17 stocks that could benefit from the Federal Budget
- (5:05) How 'time in the market, not timing the market' stands up in 2021
Following US equities rise overnight, the Aussie share market is set to open higher, with the futures suggesting a rise of 0.67% or 7021 points.
What to watch:
- Recce Pharmaceuticals (ASX:RCE) is set to report their 3Q21 Earnings today.
- The Oil price dropped 3.51%. The decline comes after concerns around the demand from India, amid the current wave of COVID-19 infections, as well as the hacking of the Colonial Pipeline in the US.
- The Gold price bounced off a one-week low, rising 0.62%, so keep an eye on Gold miners like Newcrest Mining (ASX:NCM) and Resolute Mining (ASX:RSG).
- Copper is down 1.09% while Iron Ore plunged 2.9% after China cautioned on commodity prices.
- The most traded stocks by Bell Direct clients yesterday were CSL (ASX:CSL), Telstra (ASX:TLS), and Australia and New Zealand Bank (ASX:ANZ). And for advised clients, the most traded stocks were Xero (ASX:XRO), BetaShares Active Australian Hybrids Fund (ASX:HBRD) and Vanguard Australian Shares Index ETF (ASX:VAS).
Trading ideas:
- Bell Potter has reiterated their Buy recommendation on GrainCorp (ASX:GNC), maintaining a $6.20 price target. GrainCorp closed yesterday at $5.43, implying a 14.2% share price growth in the year.
- Alliance Aviation Services (ASX:AQZ), Ava Risk Group (ASX:AVA) and People Infrastructure (ASX:PPE) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting a 0.4% fall. The Aussie tech sector is following the US.
What to watch today:
- The iron ore price surged 1.4% overnight to US$218.
- NAB (ASX:NAB) and Westpac (ASX:WBC) go ex-dividend today, along with Pendal (ASX:PDL).
- New home sale data is out today for April from the Housing Industry Association (HIA).
- The most traded stocks by Bell Direct clients yesterday: Flight Centre (ASX:FLT), NAB (ASX:NAB), Aeris Resources (ASX:AIS), Zip Co (ASX:Z1P)
Trading ideas:
- Watch Virgin Money (ASX:VUK) as UK restrictions ease this weekend and the UK economy is picking up.
- Telstra (ASX:TLS) and Mader (ASX:MAD), both Bell Potter Buy stocks, and Jupiter Mines (ASX:JMS) are all giving off bullish signals according toTrading Central.
The Federal Government released its 2021-2022 recovery budget, unveiling funding for infrastructure projects, aged care and defence and intelligence agencies.
Following the US, he Aussie share market is set to drop, with the futures a 0.64% fall.
What to watch today:
- The Federal Government unveiled its 2021-2022 “recovery budget”. There are three key considerations for ASX investors and companies:
- Firstly, $15.2 billion in additional spending will go to infrastructure projects. Watch Lendlease Group (ASX:LLC) and Cimic Group (ASX:CIM).
- Secondly, $18 billion in additional funding will go to the aged care system. Keep an eye on companies like Regis Healthcare (ASX:REG), Estia Health (ASX:EHE), Japara Healthcare (ASX:JHC), PainChek (ASX:PCK) and Alcidion (ASX:ALC).
- Finally, $1.9 billion will go to defence and intelligence agencies. Watch Austal (ASX:ASB), Appen (ASX:APX) and BrainChip (ASX:BRN).
- CBA, Pushpay Holdings (ASX:PPH), AusNet Services (ASX:AST) and CSR Limited (ASX:CSR) set to report today.
- AGMs today include Sigma Healthcare (ASX:SIG), Smartgroup Corporation (ASX:SIQ), Telix Pharmaceuticals (ASX:TLX) and Unibail-Rodamco Westfield (ASX:URW).
- The Oil price lifted about 0.9%, the Gold price slipped as rising US yields dim appeal. And, Copper was up 1.5%.
- The most traded stocks by Bell Direct clients yesterday: Westpac (ASX:WBC), National Australia Bank (ASX:NAB) and ANZ (ASX:ANZ).
Trading Ideas:
- Bell Potter have maintained their Buy recommendation on AMA Group (ASX:AMA), however have decreased its price target by 18%.
- Bell Potter have upgraded their recommendation on Eagers Automotive (ASX:APE) from a Hold to a Buy.
- Harvey Norman (ASX:HVN), Adacel Technologies (ASX:ADA) and Capral (ASX:CAA) are all showing bullish charting signals according to Trading Central.
US equities fell overnight with all three benchmarks closing lower, as tech stocks dragged down the market.
Following the US, the Aussie share market is set to drop, with the futures suggesting a 0.73% fall.
What to watch today:
- New home sales will be released this morning, currently at their highest since 2004.
- The Australian budget will be released tonight. Federal Treasurer Josh Frydenberg says the upcoming budget will prioritise job creation. The Australian economy has seen a better than expected economic recovery from the COVID-19 outbreak, after seeing the largest budget deficit last year since WWII.
- Leading Australian tech shares like Afterpay (ASX:APT) and Zip (ASX:Z1P), following US tech shares coming under pressure overnight.
- Boral (ASX:BLD) after Seven Group Holdings (ASX:SVW) launched an off market takeover offer. Seven already holds a 23.2% stake in the group and is offering $6.50 cash per Boral share - an offer that matched Boral’s closing price on Monday.
- The Oil price is down 0.03%, Copper down 3.69%, Silver down 0.5%, while Iron Ore is up 5.45%. And Gold is up 0.3% nearing a 3-month peak.
- The most traded stocks by Bell Direct clients yesterday were Deterra Royalties (ASX:DRR), (ASX:ANZ) and Fortescue Metals (ASX:FMG).
Trading ideas:
- Bell Potter has maintained their Buy recommendation of a2 Milk (ASX:A2M), with a price target of $8.50, previously $9.50. a2 Milk closed yesterday at $6.10, implying a 39.3% share price growth in the year.
- Bell Potter have released another report on Synlait Milk (ASX:SM1), lowering their price target to $3.85. SM1 closed yesterday at $3.03, implying 27.1% growth.
- Brainchip Holdings (ASX:BRN), West African Resources (ASX:WAF) and Aurelia Metals (ASX:AMI) are all giving off bullish charting signals according to Trading Central.
On the eve of the Australian Federal Budget being handed down tomorrow night - with a massive $4 billion injection into infrastructure expected – the Aussie share market futures suggest the market will get off to a slow start this week – the futures suggesting a dip of 0.1%.
What to watch:
- Iron ore surged over 3% taking the key steel ingredient off the charts to US$204. Morgan Stanley expects the iron ore price will rise to US$215 this year – and this will benefit Fortescue Metals Group (ASX:FMG).
- All eyes on Crown Resorts (ASX:CWN) following an increased takeover offer and a merger proposal.
- Pendal (ASX:PDL) reported half year results and entered a trading halt after announcing plans to buy a US investment company for $413 million.
- The a2Milk Company (ASX:A2M) shares are likely to come under further pressure today as it advised it won’t be meeting its guidance and that its earnings will be significantly lower.
- Economic news out – NAB business confidence for April.
Trading ideas:
- Bell Potter reiterated Regis Resources (ASX:RRL) as a BUY but reduced its price target to $4.08, implying 51% growth in a year.
- OceanaGold (ASX:OGC), Hazer (ASX:HZR) and Euro Manganese (ASX:EMN) are all giving off bullish charting signals according to Trading Central.
All three US benchmarks rallied on Thursday and US stock futures have opened slightly higher ahead of key April jobs report data.
Given this, the Aussie share market is set to open higher, mirroring US gains with the futures are suggesting a 0.28% rise at the open.
What to watch:
- Australia will publish the April AIG Performance of Services Index, which was previously at 58.7, while the RBA will unveil the Minutes of its latest meeting at 11:30am AEST.
- Travel stocks like Flight Centre (ASX:FLT), Qantas (ASX:QAN) and Air New Zealand (ASX:AIZ) after New Zealand Prime Minister Jacinta Arden put a 48-hour halt on quarantine free travel between New South Wales and New Zealand.
- Newscorp (ASX:NWS) reported third quarter profits of $US96 million, after a billion dollar net loss previously. Newscorp’s steady growth is highly driven by their digital real estate segment.
- REA Group (ASX:REA) reported third quarter 2021 sales. The group delivered strong third quarter results with revenue increasing 8% year-on-year.
- Goodman Group (ASX:GMG) and Macquarie Group (ASX:MQG) set to report results later today.
- Iron Ore continues to trade higher, currently at a record high of US$197.68.
Trading ideas:
- Bell Potter has reiterated their BUY recommendation on Emeco Holdings (ASX:EHL) with a $1.50 price target.
- Bell Potter have also retained their BUY recommendation on Synlait Milk (ASX:SM1), maintaining its price target at $4.10.
- Southern Cross Media Group (ASX:SXL), Peel Mining (ASX:PEX), and Bisalloy Steel Group (ASX:BIS) are all giving off bullish charting signals according to Trading Central.
Aussie share market set to open higher following US equities strong earnings results, with the futures suggesting 0.07% lift.
What to watch today:
- National Australia Bank (ASX:NAB) reported its H12021 results today. It reported cash earnings of $3.343 billion, which is 35.1% higher compared with H12020.
- Vehicle mobility solutions business Eclipx Group (ASX:ECX) to report today.
- The Oil price dipped despite declining inventory, the Gold price lifted following a retreat in the US dollar, and iron ore continues to trade at a record high.
- AGMs today include Genworth Mortgage (ASX:GMA), Iress (ASX:IRE) and TPG Telecom (ASX:TPG).
- The most traded stocks by Bell Direct clients yesterday: Australia and New Zealand (ASX:ANZ), Afterpay (ASX:APT) and Flight Centre (ASX:FLT).
Trading ideas:
- One of the world’s largest producers of high-quality metallurgical coal, Coronado Global Resources (ASX:CRN) had its BUY rating reiterated by Bell Potter.
- City Chic Collective (ASX:CCX) also maintains its BUY rating, with an increased price target of $4.90.
- South32 (ASX:S32), Worley (WOR) and Tesserent (ASX:TNT) are all showing bullish charting signals according to Trading Central.
The Aussie share market is set to pull back 0.4% at the open if you go by the futures, with Tech stocks likely to pull back the most.
What to watch today:
- Australia and New Zealand Bank (ASX:ANZ) reported results, with shares likely to lift 0.6%. ANZ half year profits rose 45% to $2.9 billion, supported by an improving economic outlook and an increase in loans.
- The UK Government are planning on easing COVID- 19 restrictions on the 17th of May. Keep an eye on ASX stocks operating in the UK, including Virgin Money (ASX:VUK), which is trading 55% higher this year and is the ASX200’s best performer in 2021.
- Amcor PLC (ASX:AMC) and Irongate (ASX:IAP) are due to report results today.
- Bank of Queensland (ASX:BOQ) to go ex- dividend today.
- Building permits for March are out today with expectations that this they will rise 3%, following the 22% lift in February. Keep an eye on building construction companies like Fletcher (ASX:FBU), CSR Limited (ASX:CSR), Brickworks (ASX:BKW) and Boral (ASX:BLD).
- The most traded stocks from Bell Direct yesterday: Dexus (ASX:DXS), Afterpay (ASX:APT) and BHP (ASX:BHP).
Trading ideas:
- Flight Centre (ASX:FLT) was reiterated as a Bell Potter Buy, albeit with a slimmer $20 price target, that implies 24% upside
- Graincorp (ASX:GNC), Capral (ASX:CAA) and West African Resources (ASX:WAF) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is likely to trade 0.2% higher today with Hydrogen stocks in the limelight.
What to watch today:
- Australia and New Zealand Bank (ASX:ANZ) is set to report earnings tomorrow, National Australia Bank (ASX:NAB) to report later this week and Commonwealth Bank (ASX:CBA) to report next week.
- The RBA meets today with the focus on bond buying as interest rates are expected to remain on hold.
- Australia’s first green hydrogen/gas power plant is set to be built in Illawarra with the government spending $300 million on the project. Hydrogen stocks in breakouts from a technical perspective include Hazer (ASX:HZR), Province Resources (ASX:PRL), Fortescue Metals (ASX:FMG) and QEM (ASX:QEM).
- As restrictions ease in the UK, keep an eye on Virgin Money UK (ASX:VUK), Link Administration (ASX:LNK), Ramsay Health Care (ASX:RHC) and Breville (ASX:BRG).
- Dexus (ASX:DXS)reports quarterly earningstoday.
- Acorn Cap Investment Fund (ASX:ACQ), Vitalharvest Freehold (ASX:VTH), and Waterco (ASX:WAT) goex-dividend today, while Bank of Queensland (ASX:BOQ) goes ex-dividend tomorrow.
- The most traded stocks from Bell Direct clients yesterday: Westpac (ASX:WBC), Kogan (ASX:KGN) and Telstra (ASX:TLS), while advised clients traded Fortescue Metals (ASX:FMG), Woolworths (ASX:WOW) and Zip Co (ASX:Z1P).
Trading ideas:
- PointsBet Holdings (ASX:PBH) was reiterated as a speculative Bell Potter Buy.
- Deep Yellow (ASX:DYL), Starpharma (ASX:SPL) and Australian Agriculture Co (ASX:AAC) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower with the futures suggesting a 0.1% slip. It’s a big week for economic news with banks set to report earnings results.
What to watch today:
- Westpac (ASX:WBC) reported their half year results this morning with statutory net profit of $3.4 billion.
- ANZ Bank (ASX:ANZ) reports on Wednesday and National Australia Bank (ASX:NAB) reports on Thursday.
- Commonwealth Bank (ASX:CBA) to provide quarterly update the following week.
- Watch earnings results from Amcor (ASX:AMC) and Pendal (ASX:PDL) this week.
- AGMs to be held for QBE Insurance (ASX:QBE), Rio Tinto (ASX:RIO) and Goodman Group (ASX:GMG).
- Commodity stocks are likely to see activity today: Oil price fell 2% on the weekend, and the Iron Ore price is up 0.2% overnight, its highest level in almost 10 years.
- Most traded stocks from Bell Direct on Friday: Sydney Airport (ASX:SYD), Qantas (ASX:QAN) and Flight Centre (ASX:FLT). Advised clients traded Magellan Global Fund (ASX:MGF).
Trading ideas:
- Bubs Australia Ltd (ASX:BUB) is a speculative Bell Potter HOLD, trading at a year low and on a downtrend.
- Pointsbet (ASX:PBH), Super Retail Group (ASX;SUL) and Enero Group (ASX:EGG) are all giving off bullish charting signals according to Trading Central.
The Aussie share market hit a 14-month high this week and is just 1.3% off its all-time high. With new key themes and opportunities emerging in this bullish market, it's a good time to re-examine the fundamentals.
In this week’s wrap, Jessica covers:
- (0:23) Why investors are finding the most value in Energy
- (1:24) What's fuelling mining stocks: record highs and electric vehicle demand
- (2:44) NIB Holdings (ASX:NHF) rising 14%, in a bullish Insurance sector
- (4:00) Three key considerations when selecting a stock for your portfolio
- (4:30) How to find stocks using Bell Direct's 'Strategy builder' tool
US equities had a positive night, with all three of the major indices increasing, with the Dow Jones rising 0.7%.
It comes as better than expected economic news came through, as the US economy grew 6.4% in the first quarter, surpassing expectations of 6.1% growth.
Amazon reported that its profits tripled to $8.1 billion.
What to watch today:
- Despite US equities closing higher, the Aussie share market is set to open lower ahead of companies reporting their quarterly results.
- Quarterly earnings are due out for Cimic (ASX:CIM), Genworth Mortgage (ASX:GMA), PointsBet (ASX:PBH) and ResMed (ASX:RMD).
- AGMs today: AMP (ASX:AMP), Life360 (ASX:360) and Janus Henderson Group (ASX:JHG).
- Commodity stocks will likely see some activity today, with the Copper price pulling back from its all-time high.
- Palladium stocks will likely see some further buying activity given the Palladium price hit a record overnight.
Trading ideas:
- Bell Potter reiterated its BUY recommendation on BCI Minerals (ASX:BCI), increasing its target to $0.57.
- Bell Potter have also reiterated Straker Translations (ASX:STG) as a BUY with a $2.15 price target, implying about 22% upside in a year.
- Lastly, bullish charting signals have been identified in Mandrake Resources (ASX:MAN), Qube Holdings (ASX:QUB) and Coles (ASX:COL) according to Trading Central.
The Aussie share market is set to open 0.26% higher amid optimism for commodity prices. Apple and Facebook exceeded revenue expectations.
What to watch today:
- The Oil price rose more than 1% off the back of fuel demand optimism.
- The Gold price gained as the US dollar and US Treasury yields eased following the Fed keeping rates unchanged.
- The Copper price hit an all-time high on China demand. Keep an eye on Copper stocks like OZ Minerals (ASX:OZL), and Sandfire Resources (ASX:SFR).
- Iron ore is trading 0.11% lower but still near the 10-year high while the Nickel price is trading 1.8% higher.
- Today, both Woolworths (ASX:WOW) and Newcrest Mining (ASX:NCM) are set to release their third quarter updates.
- Most traded stocks for Bell Direct clients yesterday: CSL (ASX:CSL), Corporate Travel Management (ASX:CTD) and National Australia Bank (ASX:NAB).
Trading ideas:
- IT company, Life360 (ASX:360) was reiterated as a Bell Potter BUY, with a $7 price target. This comes off the back of a strong March quarter.
- Bell Potter also has a BUY rating on health informatics business, Alcidion (ASX:ALC), with an upgraded price target of $0.45, that’s a huge 50% increase
- RMA Global Holdings (ASX:RMY) is giving off bullish charting signals according to Trading Central.
The futures are suggesting a 0.24% gain today for the Aussie share market – moving past two days of selling.
What to watch today:
- The Aussie dollar has fallen ever so slightly from its three-year high – making our exports slightly cheaper.
- The iron ore price rose 0.8% overnight to an almost ten-year high. So in theory it should be a good day for iron ore majors, Fortescue Metals (ASX:FMG), BHP (ASX:BHP) and Rio Tinto (ASX:RIO).
- Our tech sector could end its three day downtrend today following better than expected results – with the US Tech sector notching its biggest revenue jump since 2018.
- Australia’s inflation numbers are out today.
- The most traded stocks from yesterday at Bell Direct: Dicker Data (ASX:DDR), CSL (ASX:CSL) & Fortescue Metals (ASX:FMG).
Trading ideas:
- GR Engineering (ASX:GNG) was upgraded as a Bell Potter Buy with a $1.50 price target after agreeing to buy an automation and technology engineering company.
- RMA Global (ASX:RMY) was reiterated as a speculative Bell Potter Buy with a $0.38 price target, implying 35% upside.
- BNK Banking (ASX:BBC), Aquis Entertainment (ASX:AQS) and Base Resources (ASX:BSE) are all giving off bullish charting signals according to Trading Central.
The Aussie market is set to open 0.1% higher. For the month of April, the Tech sector is up the most while Energy underperforms.
What to watch:
- South32 (ASX:S32) doubled its cash in the March quarter while it reported record alumina from Brazil and Australian Manganese year to date.
- Bingo (ASX:BIN) agreed to a takeover by Macquarie (ASX:MGQ) for $3.45 per year, minus a $11.70 dividend.
- Perth exits its lockdown today and the Federal Government will review Australia’s COVID-19 vaccine rollout.
- The Australian dollar is trading at its highest level since February this year, which is making our exports more expensive.
- Expect tax loss selling as the end of the financial year approaches. Selling to mount stocks that heavily underperformed, including The a2 Milk Company (ASX:A2M), Mesoblast (ASX: MSB), financial stocks IOOF (ASX:IFL) and Origin Energy (ASX:ORG), and energy companies AGL Energy (ASX:AGL) and Kogan (ASX:KGN).
- The most traded stocks from Bell Direct yesterday: Dicker Data (ASX:DDR), Van Eck Vectors Gold Miners ETF (ASX:GDX) and Galaxy Resources (ASX:GXY).
Trading Ideas:
- Doctor Care Anywhere (ASX:DOC) was restamped as a Bell Potter Buy stock with a $1.95 price target after it reported record revenue.
- Emeco Holdings (ASX:EHL) also reiterated as a Bell Potter Buy, with a $1.50 price target.
- Rhythm Biosciences (ASx:RHY), Loneer (ASX:INR) and Capral (ASX:CAA) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open higher with the futures suggesting a 0.1% lift. Tech and airline stocks will be in focus today.
What to watch:
- The Aussie tech sector is up 10% this month, Industrials is 6% and Materials is up 7.2%.
- Iron ore price continued to increase 0.4% overnight chasing down a new 10-year high. Watch Fortescue Metals Group (ASX:FMG), Magnetite Mines (ASX:MGT) and Mineral Resources (ASX:MIN) today.
- Platinum futures are up 2%, and Palladium futures are up 0.5%. Copper trades lower.
- The Oil price is 0.1% higher at US$62.22, with futures 1% higher.
- Westpac (ASX:WBC) has announced its half year profit will be $282 million accounting for litigation costs and software write-downs, as well as IOOF separation expenses.
- NIB Holdings (ASX:NIB) has announced its underlying profit for the 2021 financial year to be much stronger than a year prior.
- The most traded stocks from Bell Direct on Friday: Vanguard Msci Index International Shares ETF (ASX:VGS), Vanguard US Total Market Shares Index ETF (ASX: VTS) and Vanguard Australian Share ETF (ASX:VAS).
Trading Ideas:
- Accent Group (ASX:AX1) was upgraded as a Bell Potter Buy stock with a $3.30 price target, implying 14% upside.
- Fortescue Metals Group (ASX:FMG) was upgraded to a Buy from a Hold by Bell Potter with an increased $23.85 price target.
- Youfoodz Holdings (ASX:YFZ) remains a Bell Potter Buy, with a lower $1.10 price target.
- Weebit Nano (ASX:WBT), Gelena Mining (ASX:G1A) and Emeco Holdings (ASX:EHL) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is on pace for its best monthly gain in 6-months. And market volatility is at a 14-month low, as vaccine rollouts ramp up.
In this week’s wrap, Jessica covers:
- Healthcare & Industrials continuing to see respite after a poor 2020
- Champion Iron (ASX:CIA) outperforming the market, rising 8%
- Freelancer (ASX:FLN) shining, up 29%
- Why clean energy investments are in full focus
- A Palladium ETF in the spotlight
- Three Palladium stocks to consider
- Why Fortescue (ASX:FMG) is worth a look, as it goes carbon neutral
The Aussie share market is set to open lower, with the futures suggesting a 0.2% pull back. US equities fell into the red overnight.
What to watch:
- Gold price moved 0.1% to US$1,784
- Stocks and securities with a green focus as the Global Climate Action summit wraps up. Keep an eye on Hydrogen stocks like Fortescue Metals (ASX:FMG), Province Resource (ASX:PRL), Hazer (ASX:HZR), and QEM Limited (ASX:QEM).
- AMP Limited (ASX:AMP) as they are set to list their funds management business AMP Capital separately on the ASX in the beginning of 2022.
- The most traded stocks across Bell Direct yesterday: Betmakers Technology (ASX:BET), CSL Limited (ASX:CSL) and Flight Centre Travel (ASX:FLT)
Trading Ideas:
- Australian Pharmaceutical Industries (ASX:API) was upgraded as a Bell Potter Buy stock with a new $1.50 price target.
- Corporate Travel (ASX:CTD) was also upgraded as Buy by Bell Potter with an increased $22.60 price target.
- Pointerra (ASX:3DP), NZME (ASX:NZM) and Pacific Smiles (ASX:PSQ)are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to lift at the open, with the futures suggesting a 0.5% gain. US stocks advanced after two days of declines.
What to Watch:
- The iron ore price fell 1.3% overnight, retreating slightly from its 9.5 year high. Iron ore stocks in uptrend breakouts include Magnetite Mines (ASX:MGT), and Champion Iron (ASX:CIA).
- The gold price rebounded 1%. Gold stocks in uptrend breakouts include Newcrest Mining (ASX:NCM), St Barbara (ASX:SBM), Evolution Mining (ASX:EVN), OceanaGold (ASX:OGC). Also watch Westgold (ASX:WGX) and Silver Lake (ASX:SLR).
- The most traded stocks across Bell Direct yesterday: Province Resources (ASX:PRL), Rumble Resources (ASX:RTR) and Alterity Therapeutics (ASX:ATH)
Trading Ideas:
- Cluey (ASX:CLU) was restamped as a Bell Potter Buy with a $1.80 price target.
- Bega Cheese Ltd (ASX:BGA) was upgraded as a Buy by Bell Potter with an increased $7.35 price target
- Brightstar Resources (ASX:BTR), Valmec (ASX:VMX) and Advanced Breaking Technology (ASX:ABV) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower, with the futures suggesting the market will fall about 1.23%, to 6911 points. This mirrors Wall Street overnight as US equities fell.
What to watch:
- There are concerns for the Trans-Tasman travel bubble after an Auckland airport employee who worked cleaning planes, has tested positive for COVID- 19, despite being fully vaccinated. Amid concerns, keep an eye on travel stocks such as Qantas Airways (ASX:QAN) and Webjet (ASX:WEB).
- The oil price fell 1.44% to US$62.46, so it’s worth watching energy producers including AGL Energy (ASX:AGL), Woodside Petroleum (ASX:WPL) and Santos (ASX:STO).
- The gold price increased by 0.5% so keep watch of Evolution Mining (ASX:EVN).
- The most traded stocks for Bell Direct yesterday. They were: CSL (ASX:CSL), Lynas Rare Earths (ASX:LYC) and Vanguard MSCI Index International Shares ETF (ASX:VGS).
Trading ideas:
- Bell Potter has a Buy rating on Senex Energy (ASX:SXY) as they approach the next growth chapter. Yesterday Senex Energy closed at $3.71 and Bell Potter has increased its price target to $3.75.
- Bell Potter has changed their recommendation for Altium (ASX:ALU) from a Hold to a Sell. ALU have been heavily discounting the price of a perpetual license by around 40% and this is likely to have a negative short-term impact on revenue. Bell Potter have decreased their price target by 4% to $27.50.
- Bell Potter has reiterated their Buy recommendation for EROAD (ASX:ERD), supported by positive unit economics, constant revenue growth and growing sales momentum in Australia and New Zealand.
- JB Hi Fi (ASX:JBH), Rural Funds Group (ASX:RFF), and RPM Automotive (ASX:RPM) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open lower this morning, with the futures suggesting the market will fall 0.45% to 7,018 points.
This comes as US equities slipped from their record levels after the tech sector weighed on the broader market.
US investors remain cautious given the large amount of corporate earnings ahead this week as well as the ongoing vaccine rollout in the US.
What to watch today:
- Following tech shares coming under pressure in the US, it's worth keeping an eye on Aussie tech shares like Afterpay (ASX:APT) and Xero (ASX:XRO), as the local tech sector tends to follow the Nasdaq's lead.
- The oil price lifted 0.5% to US$63.47 a barrel following the US dollar weakening. So, keep an eye on energy producers like Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
- The gold price fell 0.32% overnight to US$1,770.47. So Northern Star Resources (ASX:NST) and Evolution Mining (ASX:EVN) will be on watch.
- The iron ore price fell 0.1%, and copper increased 1.6%, while silver fell 0.58%.
Trading ideas:
- Bell Potter has a Buy rating on Cooper Energy (ASX:COE), with a $0.45 price target. Cooper Energy has expansion projects aiming to support production leveraged to Australia’s tightening east coast gas market.
- Mineral Resources (ASX:MIN) closed yesterday at $43.76. Bell Potter has increased its price target on the stock by 14% to $49.30. EPS forecasts and highly sensitive movement to iron ore prices has led to this lift.
- Eclipx (ASX:ECX), Lynas Rare Earths (ASX:LYC) and Reliance Worldwide (ASX:RWC) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to extend last week’s advance and start the week higher, with the futures suggesting the market will lift 0.5% to 7,071 points. This takes the market just 1% away from the record set before the pandemic.
What to watch today:
- The country’s leaders will be discussing today a reset of the vaccination program, which could lead to people aged over 50 being vaccinated sooner and further mass-vaccination sites opening.
- The oil price dipped, but still posted a gain for the week. This was driven by optimism over a recovery in demand.
- Gold miners like Newcrest Mining (ASX:NCM) and Northern Star Resources (ASX:NST) could start the week on a positive note after the Gold price pushed higher on Friday night.
- Stocks going ex-dividend this week include mining company New Hope Group (ASX:NHC) and investment company Soul Pattinson (ASX:SOL).
- The most traded stocks last Friday from our active trader desk, Bell Direct Advantage. They were Brainchip (ASX:BRN), Magnetite Mines (ASX:MGT), which both rose about 7% and Oneview (ASX:ONE), up about 2.5%.
Trading ideas:
- Bell Potter has lifted its price target for Eagers Automotive (ASX:APE) to $16.50, previously $15.50. Bell Potter’s view is that a 2021 PE ratio in the mid to high teens is appropriate for what we can expect to be peak earnings for the company.
- Adairs (ASX:ADH), Medusa Mining (ASX:MML) and Beach Energy (ASX:BPT) are all giving off bullish charting signals according to Trading Central.
The Aussie share market gained momentum this week, and is within a whisker of the February 2020 all-time high. Could the market hit a new high next week?
In this week’s wrap, Jessica covers:
- (0:38) The Tech sector's continued bounce back as bond yields fall
- (1:05) The trifecta of better than expected economic news
- (1:36) Mineral Resources (ASX:MIN) rising 10%, following iron ore & lithium boost
- (3:18) Why you should review your portfolio
- (4:16) A potential US pullback? What you need to know...
- (5:05) The hottest stocks this week for Bell Direct clients
US stocks smashed records this morning. The Dow Jones closed over 34,000 points for the first time. The S&P500 was up 1.1% to another new record, while the Nasdaq lifted 1.3%, setting a new record high.
What to watch today:
- The Aussie market is breathing down the neck of an all-time high - we’re 1.5% away.
- Afterpay (ASX:APT) is seeing buy orders lining up. Zip (ASX:Z1P) shares are also likely to lift based off early buying, staging it for a rebound following its $400m capital raising.
- Iron ore giant, Fortescue Metals (ASX:FMG) is moving into the hydrogen sector, building a green-steel plant in Brazil, which will help FMG become carbon neutral by 2030. So keep an eye on other hydrogen stocks like HZR, QEM, PRL
- The iron ore price has risen back to a 9.5 year high. Keep an eye on Mineral Resources (ASX:MIN).
- The most traded stocks from yesterday. For our active trader desk, Bell Direct Advantage they were Magnetite Mines (ASX:MGT) and Volt Resources (ASX:VRC).
Trading ideas:
- Plenti Group Limited (ASX:PLT) was initiated as a Bell Potter Buy.
- Access Innovation (ASX:AIM) was re-stamped as Bell Potter Buy. Bell Potter expects AIM shares to jump 47% to $1.35 in a year.
- Sandfire Resources (ASX:SFR), Redbubble (ASX:RBL) and Calix (ASX:CXL) are all giving off bullish charting signals according to Trading Central.
Aussie share market is in an uptrend, hitting a new 13 month high yesterday. All eyes will be on tech stocks today.
What to watch today:
- Zip (ASX:Z1P) is one to watch today as yesterday Citi stamped the stock as buy with a $11.30 target. The company entered into trading halt pending a capital raising.
- Qantas (ASX:QAN) to get back to 90% capacity in fourth quarter of this year, compared to 25% in mid-2020. Jetstar also reach 120% pre-COVID-19 Domestic Capacity - Qantas 107% in FY22.
- Michael Hill (ASX:MHJ) looks set for a rally after reporting a shiny quarterly report – digital sales rose 69% and store sales rose 16%.
- 35,000 people are expected to have gained jobs last month, with unemployment expected to fall to 5.7%.
- The most traded stocks from yesterday. For our active trader desk, Bell Direct Advantage they were: Brainchip (ASX:BRN), Insurance Australia Group (ASX:IAG) and IOU Pay (ASX:IOU)
Trading ideas:
- Mayne Pharma (ASX:MYX) was restamped as Bell Potter Buy with its shares expected to grow 29% to $0.56.
- Synlait Milk (ASX:SM1) was upgraded by Bell Potter as a Buy. Bell Potter expects SM1 shares to jump 27% to $4.10, with sour sales behind it and the infant formula business set for growth.
- Motorcycle Holdings (ASX:MTO), Pro Mediucs (ASX:PME) and ALS (ASX:ALQ) are all giving off bullish charting signals according to Trading Central.
US stocks closed mostly higher as bond yields fell, which is supportive of equities. The Aussie market is expected to lift 0.3% or 19 points at the open.
What to watch today:
- Tech stocks are expected to shine the most as bonds yield fell from their 12-month high to 1.71%, making tech stocks look far more attractive.
- Zip (ASX:Z1P) will be traded a lot today, as it jumped 17% yesterday after reporting another strong quarter – with revenue, merchants and customers all rising by 10%-20%.
- Afterpay (ASX:APT) is another one to watch, rising 3% yesterday and is likely to lift further in the short term.
- Consumer confidence is released for April which is expected to be positive as employment is at pre-pandemic levels.
- The most traded stocks from yesterday . For our active trader desk, Bell Direct Advantage they were: Magnetite Mines (ASX:MGT), Delorean (ASX:DEL) and 88 Energy (ASX:88E).
Trading ideas:
- Online luxury fashion website Cettire (ASX:CTT) which sells designer brands like Givenchy, Chanel and Valentino was initiated as a Bell Potter Buy with a $1.90 target.
- The rival company to NBN, Uniti Group (ASX:UWL) had it Buy rating upgraded by Bell Potter, with a new $2.85 target as its network revenue is likely to increase.
- Uniti Group (ASX:UWL), SenSen Network (ASX:SNS) and Pushpay Holdings (ASX:PPH) are all giving off bullish charting signals according to Trading Central.
Vaccine talks will dominate local headlines today for two reasons - the Federal government has taken the J&J vaccine off the table and ScoMo has said that Aussies will likely not receive a vaccine by the end of year.
This means travel and tourism stocks will be back in focus, in particular Qantas (ASX:QAN), as the company planned to initially resume international flights in October as Australians were initially set to be vaccinated by then.
What to watch today:
- The Aussie market is expected to rise 0.2% if the futures are correct.
- New home sales and business confidence data out today.
- Keep an eye on the most traded stocks from yesterday. For our active trader desk, Bell Direct Advantage they were: Delorean (ASX:DEL) which listed on the ASX on Monday, and Digital Wine Ventures (ASX:DW8).
Trading ideas:
- The a2Milk Company (ASX:A2M) was upgraded from a Hold to a Buy with an increased price target of $9.50 as China distribution is showing strong signs of early life.
- Macquarie rated Dexus (ASX:DXS) as a Buy with a $10.33 target and an estimated dividend yield of 4.53%.
- Galan Lithium (ASX:GLN), Mach7 Technologies (ASX:M7T), People Infrastructure (ASX:PPE) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is set to start the week higher. The futures are suggesting a gain of 0.1% which will rub out Friday’s fall.
US equities closed at new records at the weekend with almost half of the US population receiving their first vaccine.
What to watch today:
- Vaccine news – Pressure has been put on ScoMo for when Australians will receive their first dose.
- Economic news: New home sales data, Business and Consumer Confidence data and on Thursday, employment data is released for March.
- Quarterly balances will be taking place - investors and fund managers will be buying heavily back into stocks that are depressed – like tech – given bond yields have eased from their year high.
- Stocks that closed in bullish breakouts and made sizeable gains last week: EML Payments (ASX:EML), Afterpay (ASX:APT) and Imugene (ASX:IMU).
- Iron ore stocks will be back in focus as one of the most traded stocks across our entire business last week was BHP.
- The most traded stocks from Friday for our active trader desk, Bell Direct Advantage. They were Oneview Healthcare (ASX:ONE) Greenland Minerals (ASX:GGG) & 88 Energy (ASX:88E).
Trading ideas:
- Immutep (ASX:IMM) was re-stamped as a Speculative Buy with an increased price target of $0.85 after the US FDA fast tracked its lead drug as a treatment for head and neck cancer.
- Whitehaven Coal (ASX:WHC) had its Buy rating increased, with Bell Potter raising its target to $2.35 as the thermal coal price strengthened in the March quarter.
- Gascoyne (ASX:GCY), Pact Group (ASX:PGH) and Proteomics International (ASX:PIQ) are all giving off bullish charting signals according to Trading Central.
After three straight weeks of growth, the Aussie share market hit its highest level in 13 months.
In this week’s wrap, Jessica covers:
- (0:40) Why the bulls are back
- (1:05) The Tech sector's 7% rise; Afterpay (ASX:APT) & Zip (ASX:Z1P) post strong gains
- (1:30) Why bank stocks got a boost this week
- (2:03) Whether EML Payments (ASX:EML) and Afterpay (ASX:APT) have more room to grow
- (3:50) The top All Ords performer: Imugene (ASX:IMU) rocketing 33%
- (4:30) Three key focus areas for the week ahead
The Aussie share market is in a bullish breakout uptrend, just a 3% puff away from the record high – hit in February 2020.
Overnight US tech stocks put their foot on the gas – with investors buying back into stay at home economy stocks .
What to watch today:
- Local stay at home economy tech stocks are set to thrive. Keep a watch on EML Payments (ASX:EML) which has already gained 17% this week and Afterpay (ASX:APT) which has lifted 14%.
- Gold trades at a one-month high. Keep an eye on Gold stocks like Silver Lake Resources (ASX:SLR), Northern Star (ASX:NST) and Ramelius Resources (ASX:RMS).
- Services Sector index data is out – tipped to show the sector grew in March as restrictions continued to ease and employment is a pre-COVID-19 levels.
- Building permits are out – so keep your eye on building and construction stocks that are trading at 12 month highs like BKW, CSR, ABC and the like
- The RBA will realise their financial stability review report.
- Keep an eye on the most traded stocks from yesterday for our active trader desk, Bell Direct Advantage. They were: 88 Energy (ASX:88E), Province Resources (ASX:PRL) and Red Sky Energy (ASX:ROG).
Trading ideas:
- Domino's Pizza (ASX:DMP) was re-stamped as a Bell Potter Buy with a $122 target, as German sales ramped up, while Bell Potter also sees Japan’s sales growing fuelled by half price takeaway orders and no minimum deliveries.
- Bullish charting signals have been identified in Afterpay (ASX:APT), Emeco (ASX:EHL) and Silver Lake Resource (ASX:SLR) according to Trading Central.
Yesterday the Aussie share market rose for the 4th day, closing at its highest level since the pandemic – 6,928 points. Today, the futures are suggesting we’ll get closer to that all-time high of over 7,000 points, and lift 0.5%.
Of significance overnight, the US Federal Reserve reflected on the improved economic outlook, and also that the US Central Bank would continue to buy bonds until employment was back to normal.
What to watch today
- International flights return to Melbourne for the first time in two months – returning Victorians home from overseas. The biggest carrier Qantas (ASX:QAN) is in an uptrend on the back of the NZ-Australia bubble. Qantas expects international flights to reopen by the year end.
- Australia’s vaccination rollout – 857,200 people have been vaccinated – ScoMo wants 25 million Aussies to have had their first jab by October.
- Commodity stocks – will be back in focus. China wants to raise its use of scrap steel in the steelmaking process, to cut its imported iron ore. So look at Steel stocks – given iron ore stocks to face pressure. Keep an eye on Sims Metal Management (ASX:SGM) and BlueScope Steel (ASX:BSL).
- Companies going ex-dividend today, including ARB (ASX:ARB) and Universe Store (ASX:UNI).
Trading ideas:
- Afterpay (ASX:APT) had its Buy rating reiterated by Morgan Stanley with a $149 target, as it’s on track to expand in Europe and Asia while its app downloads tripled in the US in March.
- Bell Potter reiterated its Buy call on cloud company Rhipe (ASX:RHP) with a $2.50 target, as it’s diversified its business away from Microsoft while going into cyber security.
Shiro Holdings (ASX:SHM), Asian Medusa Mining (ASX:MML) and Pinnacle Investment Management (ASX:PNI) are all giving off bullish charting signals according to Trading Central.
Yesterday we saw the Aussie market hit a 6-week high after rising for three days and lifting 0.8% - attempting to play catch up with global equities. Today, the futures are suggesting a small lift of 0.04%.
The IMF raised global growth forecasts from 5.2% to 6%. That’s the quickest growth rate since 1980. For Australia it sees our economy growing at 4.5%.
What to watch today
- Today traders and investors will be focused on four areas: (1) Stocks benefitting from Australian NZ flights taking off 19 April - like Air New Zealand (ASX:AIZ) which rose 8% yesterday. (2) The Tech sector – Yesterday it saw its biggest gain in a long time, with Afterpay (ASX:APT) rising 10%, Zip (ASX:Z1P) rising 9% and Xero (ASX:XRO) rising 3.1% - as bond yields stabilised and the US tech sector is coming back. (3) Stocks that hit a 52-week high to see if they have more momentum. (4) Eco news – construction index for March – expected to show further growth, supporting earnings in construction and mortgages stocks and Services sector data due out today – expected to strengthen.
- Companies going ex-dividend today, including Adbri (ASX:ABC) as well as ETFs like IOZ, which is the top 200 ETF, and IGB which is a Bond ETF.
Trading ideas:
- Bell Potter reiterated its Buy calls on two stocks overnight: Acrow Formwork & Construction (ASX:ACF) with a $0.45 target and Senex Energy (ASX:SXY) with a $3.71.
- Super Retail Group (ASX:SUL), Redbubble (ASX:RBL) and Nickel Mines (ASX:NIC) are all giving off bullish charting signals according to Trading Central.
The Aussie market is eyeing a gain of 0.3% if you go by the futures - likely to extend its rally from Wednesday and Thursday – which will form a nice uptrend for the ASX200.
What to watch today:
- Economic recovery stocks – expected to gain momentum as GP clinics offering COVID-19 vaccines will double to 3,000 by this week with 4,000 clinics offering the vaccine by the end of April.
- Economic news to watch: ANZ job ads out for March and the RBA hold their first meeting of the month - rates to hold but the focus will on Australia’s economic recovery.
- Stocks that will do well following the trans-Tasman bubble announced later today. Keep an eye on Air New Zealand (ASX:AIZ) and Qantas (ASX:QAN).
- ASX stocks exposed to the UK – and could benefit as the UK considers a vaccine passport. These include Link Administration (ASX:LNK) and UK Bank Virgin Money (ASX:VUK).
- Oil stocks will likely come under pressure after the Oil price fell 6% ahead of OPEC and its ally countries ramping up production from May to July.
- Companies going ex-div today: Sigma Healthcare (ASX:SIG) and Perpetual Equity Investment Company (ASX:PIC).
- Most traded stocks at our active trader desk, Bell Direct Advantage: 88 Energy (ASX:88E), Red Sky Energy (ASX:ROG) & Brookside Energy (ASX:BRK).
Trading ideas:
- UBS upgraded South32 (ASX:S32) as a Buy while upping its price target to $3.20.
- Bell Potter called out its key retail sales stocks to watch: City Chic (ASX:CCX), Dominos (ASX:DMP) and Accent (ASX:AX1).
- Australian Finance Group (ASX:AFG), Sezzle (ASX:SZL) and Pinnacle Investment Management (ASX:PNI) are all giving off bullish charting signals according to Trading Central.
We saw US equities rise on Wednesday, closing out the best month since November, as investors rotated back into tech while weighed down on Biden’s big infrastructure spending plan. Over the sea, European markets closed lower as Deliveroo tumbled on its debut, falling as much as 30% and euro zone inflation jumped to 1.3% in March from 0.9% in February.
What to watch today:
- The Aussie market looks set to start the month of April on a positive note, up 0.28%, ahead of the four-day Easter break.
- Australia’s import and export data are out today, as well as retail and home loan data. Both data points are out at 11:30am.
- Keep an eye on Aussie tech shares such as Xero (ASX:XRO) and Zip (ASX:Z1P) following US tech stocks surging higher overnight.
- The Oil price fell 0.8% to US$63.66 per barrel off the back of concerns about the market’s recovery after OPEC and its allies lowered their 2021 demand growth forecast by 300,000 barrels per day.
- The Gold price lifted about 1.3%, helped by the dollar’s pushback, but elevated US bond yields still puts the metal on course for its worst quarter in 4 years.
- As for the most traded stocks yesterday from our active trader desk, Bell Direct Advantage they were: 88 Energy (ASX:88E), Houston We Have (ASX:HWH) and Oneview Healthcare (ASX:ONE).
Trading ideas:
- Bell Potter has upgraded its rating on Mayne Pharma (ASX:MYX) from a Hold to a Buy, and has increased its price target by 70% to $0.56 (previously $0.33).
- Pointerra (ASX:3DP), Healthia (ASX:HLA) & Galaxy Resources (ASX:GXY) are all giving off bullish charting signals according to Trading Central.
The Aussie market is set to open higher, around 0.8%, which defies the losses that were seen over on Wall Street.
Major tech shares were in the red after the 10-year Treasury yield reached its highest level since January 2020. Both Apple and Microsoft led the losses. They both fell about 1%.
What to watch today:
- Building permits for February are out today at 11:30am.
- The Oil price dipped 1.6% to US$60.55. This comes as the Suez Canal reopened to traffic and the dollar rallied. Focus in the market now shifts to a meeting between oil-producing nations where its expected that the supply curbs will be extended given dim demand prospects.
- The Gold price slipped nearly 2%. The firmer dollar, higher Treasury yields and hopes for a faster US economic recovery has dampened demand in the safe-haven asset.
- As for the most traded stocks yesterday from our active trader desk, Bell Direct Advantage they were: Byrah Resources (ASX:BYH), 88 Energy (ASX:88E), and Digital Wine Ventures (ASX:DW8).
- Shares going ex-dividend today: Eagers Automotive (ASX:APE) and Harvey Norman (ASX:HVN).
Trading ideas:
- Bell Potter maintains its Buy rating on Flight Centre (ASX:FLT) and price target for the stock at $21.50. Given the recovery profile of global travel remains in its early stages, and the roll out of the COVID-19 vaccinations programs is accelerating, Bell Potter believes FLT is highly leveraged to this step change and remains their key pick in the sector.
- Bell Potter also has a Buy rating on AMA Group (ASX:AMA) however they have reduced its price target by about 11% to $0.85. This comes as the number of AMA job vacancy ads over the past weeks on sites such as Seek appear to be higher than usual, which suggest the company may be having some trouble sourcing qualified people. Despite this, Bell Potter sees good value in the current share price and the catalysts being a return to more normal operating conditions in FY22.
- Noxopharm (ASX:NOX), Kina Securities (ASX:KSL) & Element 25 (ASX:E25) are all giving off bullish charting signals according to Trading Central.
The Aussie market is eyeing a lift of 0.7% if you go by the futures. But the market will be mulling over travel and tourism stocks as Brisbane bunkers into a three day snap lockdown.
What to watch today:
- Profit reshuffles ahead of the quarter ending tomorrow – expect profit taking in stocks that have had a good rally like banks, travel and tourism stocks. While tech stocks could rally as fund managers attempt to bring their portfolio and asset allocations back into line.
- AGL (ASX:AGL) announced it will split its business into two - one entity which it’s calling New AGL will create low carbon energy powering 30% of Australia’s households. The other entity PrimeCo will provide 20% of the nation’s energy into the grid via its thermal coal.
- Commonwealth Bank (ASX:CBA) is due to pay out $1.50 per share in dividends today, that’s worth about $2.6 billion. Other large dividends getting paid out today are by Insurance Australia (ASX: IAG) and Northern Star (ASX:NST).
- Oil stocks will likely see a bit of price action today as Oil rose 1% ahead of an OPEC meeting, with production cuts expected - which supports the price of oil moving higher.
- As for other most traded stocks from yesterday at our active trader desk, Bell Direct Advantage they were: Fortescue Metals (ASX:FMG), Golden Mile (ASX:G88) and West Wits Mining (ASX:WWI).
Trading ideas:
- UBS upgraded online beauty retailer Adore Beauty Group (ASX:ABY) from a Hold to a Buy with a $6.20 target. ABY recently delivered a strong maiden result earnings (EBITDA) up 26%, which was ahead of UBS estimates.
- Car dealership company Eagers Automotive (ASX:APE) was also given a turnaround upgrade with Bell Potter moving it from a Hold to a Buy with a $15.50 target. Bell Potter sees APE’s earnings per share growing 10% thanks to the sale of its truck business.
- Bell Potter upgraded tech athlete management business Catapult Group (ASX:CAT) from a Hold to a Buy, rising its target to $2.25.
- BetMakers Technology (ASX:BET), Secos Group (ASX:SES) and Pointsbet Holdings (ASX:PBH) are giving off bullish charting signals according to Trading Central.
US stocks ended higher on Friday, with the benchmark index the S&P500 rising 1.7% to a record high, while Nasdaq ended up 1.2% as investors continue to chase stocks benefiting from the economy reopening. BHP and Rio Tinto listed in the US, both rose 3.9%, after the oil price rebounded, while the copper price jumped over 2% back to it’s 10 year high neighbourhood, supported by better than expected economic growth numbers from the US last week.
What to watch today:
- Futures suggest a rise of 0.7% after the market rose 1.2% last week – its biggest gain in 5 weeks.
- Key economic data: building permits for February are released on Wednesday, Australian import and export data will be released on Thursday. Additionally on Thursday, retail and home loan data is set to be released.
- Stocks benefiting from the economic recovery in light of NSW and VIC restrictions have eased: Centuria Capital (ASX:CNI), Redcape Hotels (ASX:RDC), APN (ASX:ADI), Charter Hall Long WALE (ASX:CLW), Centuria Office REIT (ASX:COF)
- Oil stocks are likely to rebound as the oil price jumped 4% on Friday, following the Suez blockage.
- 88 Energy (ASX:88E) has been one of the most traded stocks over the past few weeks, and today it announced much awaited drill results from Alaska.
- The most traded stocks from our active trader desk, Bell Direct Advantage were: Digital Wine Ventures (ASX:DW8), Creso Pharm (ASX:CPH) and Airtasker (ASX:ART).
The market put on its best weekly gain in five weeks as 300,000 Aussies got the jab and restrictions are set to ease in NSW and Victoria. Investors continue to reshuffle their portfolios, buying into economic growth stocks, whilst moving out of Tech.
In this week’s wrap, Jessica covers:
- (0:29) Healthcare beating the market: CSL rises 6%
- (1:10) Why economic growth sectors are thriving as pandemic dust settles
- (1:48) A look at the best performers this week: Crown Resorts (ASX:CWN) and Graincorp (ASX:GNC)
- (3:46) Three key areas to watch next week
- (4:25) How to find stocks that are kind to the earth
- (5:45) Bell Direct's ten most traded stocks this week
Bank stocks like JPMorgan Chase rose 1%, following an announcement by the Fed that big banks will be able to resume normal dividend payouts and share buy backs from 30 June. Citi, Wells Fargo and Goldman Sachs followed JPMorgan Chase’s rise.
Economic News:
- Weekly unemployment claims fell to their lowest level in a year; jobless claims fell to 684,000 last week - far lower than forecast.
- Economic growth rose 4.3%, beating the expected 4.1%.
- The Dow Jones rose 0.6%, with Boeing outperforming rising 3.3%, American Express followed.
- The Nasdaq rose 0.1%. – The standout was travel and restaurant booking site, Booking Holdings up 3%
What to watch today:
- Futures suggest the Aussie share market will lift 0.3%. The ASX200 trades 1.3% higher this week, which is the market’s best gain in 5 weeks.
- As restrictions lift in NSW on Monday, Pub owner ALE (ASX:LEP), and Redcape Hotels (ASX:RDC), and Hotel Property Investments (ASX:HPI) are worth watching.
- Victorian restrictions ease tonight, keep an eye on Centuria office REIT (ASX:COF) and retailer Home Consortium (ASX:HMC)
- The cargo ship blocking the Suez Canal, in Egypt - a route that sees 12% of global cargo moving through it and 10% of the world’s oil supply.
- Oil fell 4% on Europe demand concerns, as the EU is worried about the vaccine rollout amid increased restrictions.
- For our active trader desk, Bell Direct Advantage the most traded stocks were; Airtasker (ASX:ART), Renascor Resources (ASX:RNU), Oneview Healthcare (ASX:ONE)
Trading ideas:
- Bell Potter reiterated Aroa Biosurgery (ASX:ARX) as a speculative buy with a $2.00 target – for more on the new research head to our website.
- Lastly – Pro Medicus (ASX:PME), Metcash (ASX:MTS), Big River Industries (ASX:BRI) could be worth a look as they’re giving off bullish charting signals according to Trading Central.
The Aussie share market is likely to follow Wall Street lower – the futures are down 0.2%.
As expected - portfolio adjustments continued to weigh on the US market; as investors ramp the switch away from 2020’s darling tech stocks, to stocks benefiting from life going back to the new normal.
What to watch today:
- Stocks that should see a lot of love today. That is, oil and iron ore stocks.
- Gold stocks should also see a bit of love, as Gold, the precious metal rose 0.4%. Keep an eye on Chalice Mining (ASX:CHN) a Bell Potter Buy that’s also in a bullish charting pattern. It also might be worth looking at Gold Road Resources (ASX:GOR) as its chart suggests it could be ending its downtrend.
- Keep an eye on some of the most traded stocks from yesterday. For our active trader desk, Bell Direct Advantage they were: Airtasker (ASX:ART) which rose 67% yesterday and Hawkstone Mining (ASX:HWK) which rose 8%.
Trading ideas:
- Bell Potter bumped up GrainCorp’s (ASX:GNC) Buy rating again, with a new $6.20 target. Yesterday GNC rose 6.2% to $5.00. And the chart says it’s about to potentially see a big rally with its 15-day moving average about to cross the 30-day.
- Bapcor (ASX:BAP) also had a good upgrade from Citi as BAP expands into Asia following its 25% purchase of Asian equivalent, Tye Soon. Citi says BAP is a Buy with a $9.35 target, expecting South Korean and Malaysian sales to boost business.
- MoneyMe (ASX:MME), GWA Group (ASX:GWA) and Eclipx (ASX:ECX) are all giving off bullish charting signals according to Trading Central.
Given the pullback overseas, the Aussie market is likely to see a pull back, but the futures are suggesting a flat open at this stage.
What to watch today:
- Airlines, travel and tourism stocks are expected to retreat from their buoyed levels. But keep in mind, Australia is in a different situation to overseas. Plus our government is offering half price airlines to some Aussie regions. This supports our services sector.
- Moving to commodities – expect scattered showers in some stocks today especially oil stocks.
- Iron ore fines (the most traded iron ore) rebounded 3.1% to US$162 and the iron ore futures are up 0.5% suggesting iron ore prices are attempting to lift further
- Palladium rose 1% overnight - so keep an eye on Chalice (ASX:CHN), DevEx (ASX:DEV) and Linton Resources (ASX:LTR)
- Keep an eye on some of the most traded stocks from yesterday for our active trader desk, Bell Direct Advantage they were: Airtasker (ASX:ART) which rose 61% from its IPO price of $0.60, QEM (ASX:QEM) which rose over 6.5% and 88 Energy (ASX:88E) was the third most traded stock, falling 10%.
Trading ideas:
- Citi reiterated Afterpay (ASX:APT) as high risk but, but downgraded its price target to $21. Citi expects the stock will be pressured over the next 3-6 months, expecting consumer discretionary to pull back from its high. Át the same time, Morgan Stanley recently reiterated APT as a Buy with a $159 target.
- Bell Potter initiated coverage of Imricor Medical Systems (ASX:IMR) as a Speculative Buy with a $2.85 target.
- Hearts and Minds Investments (ASX:HM1), Cettire (ASX:CTT) and Fortescue Metals (ASX:FMG) are all giving off bullish charting signals according to Trading Central.
Overnight US tech stocks marched forward with the Nasdaq gaining 1.2% while the broader S&P500 followed up 0.7%. Meanwhile, the benchmark 10-year bond yield fell back to 1.695%. Banks continued to fall off their recent highs, after the Fed decided banks should be holding more capital now.
What to watch today:
- Today is the one year anniversary of the COVID-19 bottom. Since then the market has gained 48%. Fundamentals and technicals suggest that the market will continue to rise over the long term.
- Today the focus will again be on two key areas – rebound tech stocks and company news as there is no economic news to go by.
- The oil price attempted to stabilise, lifting 0.1%
- Copper stocks should have a good day after copper rose 0.7%
- Yesterday, the most traded stocks on our active trader desk, Bell Direct Advantage were: Freedom Foods (ASX:FNP) which fell 83%, Oneview Healthcare (ASX:ONE) which gained 9%, and 88 Energy (ASX:88E) which rose 35%.
Trading ideas:
- Bell Potter initiated coverage of EROAD (ASX:ERD) as a BUY with a bullish $4.87 target
- Citi increased Beach Energy’s (ASX:BPT) price target to $1.81, but maintained the stock as a hold
- Praemium (ASX:PPS), Bendigo and Adelaide Bank (ASX:BEN) and Washington H. Soul Pattinson (ASX:SOL) are all giving off bullish charting signals according to Trading Central.
The Aussie market is expected to have a soggy start the week, with the futures down 0.2%.
In the US, Tech stocks came back in favour while blue chip stocks were sold down. Investors took profits from banks following the US Central Bank deciding not to extend a leverage ratio for banks.
What to watch today
- A quiet week economically: manufacturing data and services sector data out for March on Wednesday.
- Following the US Tech rally: keep an eye on Afterpay (ASX:APT) & Zip (ASX:Z1P). They’re in downtrends but small cap IOU (ASX:IOU) added the Tech index from today – is breaking out. Also in the larger caps, it looks like Xero (ASX:XRO) looks like it’s attempting to break out.
- The vaccine rollout - 6 million Aussies will eligible for the jab from today, 1,000 GP clinics will offer the vaccine.
- The TGA approved AstraZeneca’s vaccine to be produced by CSL. So keep your eyes on CSL (ASX:CSL) even though they are in a downtrend
- Distressed Crown Resorts (ASX:CWN) received an $8 billion takeover offer valuing its shares at $11.85 a piece. On Friday CWN closed at $9.86. So now there’s a line-up of retail traders rushing to buy the stock now.
- Separately, commodity stocks will be back in focus. The Oil price jumped 2% to $61.42. Gold and Silver up 0.5%. While Iron Ore continues to head south.
Trading ideas:
- Nickel company Western Areas Ltd (ASX:WSA) was moved from a Hold to a Buy with a $2.45 target.
- Bell Potter initiated coverage of gas supplier Central Petroleum Ltd (ASX:CTP) with a $0.23 target.
- People Infrastructure (ASX:PPE), Hearts & Minds Investments (ASX:HM1) and Teaminvest Private Ltd (ASX:TIP) are all giving off bullish charting signals according to Trading Central.
More positive economic recovery news hit the headlines this week, as 90,000 Australians gained jobs, and interest rates were pledged to keep at their record low. But, with China moving towards a greener future, positive news wasn't flowing to the mining sector...
In this week’s wrap, Jessica covers:
- (0:10) The economic pickup: employment back at pre-COVID levels
- (1:10) The Mining sector pull-back: why FMG & MIN could be hurt the most
- (2:25) Collins Foods (ASX:CKF) rallying after a fund manager buys a major stake in the KFC, Taco Bell chain
- (3:17) The All Ords best performers this week
- (3:47) The three most traded stocks across Bell Direct
- (5:10) Stocks to be added to the ASX200, the ASX300 and the All Ords
US Economic recovery stocks fell off their all-time high podium overnight as Bond yields spiked again. The US 10 year bond hit a yield of 1.7%, while the 30-year bond rate topped 2.5%. Bonds now offer a better yield than the average US Tech stocks, which pay an average 1.5% yield.
This is why we’ve seen the rotation out of US an Aussie tech stocks, and into companies with stronger balance sheets that and pay dividends.
What to watch today:
- The market is expected to pull back 0.6% on Friday and end lower across the week, marking the first fall in three weeks.
- Oil stocks are likely to see heavy profit taking today after the sector’s gained 63% in a year –
- Other Commodity stocks might be a shining light; Platinum, gold, silver and iron
- Keep an eye on some of the most traded stocks from yesterday. For our active trader desk, Bell Direct Advantage they were: Sayona Mining (ASX:SYA), Integral Diagnostics (ASX:IDX) and 88 Energy (ASX:88E).
Trading ideas:
- Chalice Mining (ASX:CHN) was given an upgrade by Bell Potter as Speculative BUY with new $6.35 target.
- Galaxy Resources (ASX:GXY) was upgraded by Citi with a new $3.10 target but dubbed a high risk HOLD. Galaxy is now operating back at fully capacity to meet lithium demand, and is producing what lower grade spodumene that customers are willing to accept.
- Lastly –Red River Resources (ASX:RVR), Nick Scali (ASX:NCK), and Resimac Group (ASX:RMC) could be worth considering, as they’re giving off bullish charting signals according to Trading Central.
The world breathed a huge sigh of relief overnight as the US Fed announced it won’t be hiking interest rates until at least 2023. So there was a flood of confidence and investors returned to economic comeback kids.
What to watch today:
- The market is expected to trade 0.2% lower today - ahead of release of employment data.
- Unemployment data is out at 11:30am. The rate is tipped to have dropped to 6.3% in Feb from 6.4% as 29,100 jobs are expected to have been added.
- Commonwealth Bank (ASX:CBA), the biggest bank in Australia is joining the BNPL party in Australia to take market share from Afterpay (ASX:APT) and Zip (ASX:Z1P).
- Commodity screens were mostly green overnight. Gold, Silver and Copper rose almost 1% or more. Oil retreated.
- Keep an eye on some of the most traded stocks from yesterday for our active trader desk, Bell Direct Advantage they were: Cannindah Resources (ASX:CAE), Renascor Resources (ASX:RNU) and IOU Pay (ASX:IOU).
Trading ideas:
- With people returning to the shops and employment improving, Australian Pharmaceutical Industries (ASX:API) was upgraded by Bell Potter as a Buy with a new $1.47 target. API’s share chart looks bullish too, from a technical perspective (with the 15 day average about to overtake the 30 day average).
- America Pacific Borates (ASX:ABR), Eclipx Group (ASX:ECX) and Pental (ASX:PTL) are all giving off bullish charting signals according to Trading Central.
US stocks treaded water overnight, with trading cautious ahead of the US Central bank’s decision on interest rates. Although US rates are expected to remain on hold at 0.25%, the world is awaiting to see what the Fed will say about inflationary concerns, which have been pushing up safe haven bonds, to a year high.
What to watch today
- Yesterday the local share market gained 0.8%, with most sectors making gains yesterday but Mining and Energy.
- Today, the Aussie share market could lose half of yesterday’s gain and fall 0.4% - if the futures are correct.
- Keep an eye on tech stocks: Afterpay (ASX:APT) just launched a new sales campaign.
- Auckland Airport (ASX:AIZ) announced traffic numbers for February, with traffic falling 71%. AIZ traders think the worst is over and its shares are in a technical share price break out suggesting its stock could grow further following 6 days of gains.
- The small frequently traded lithium company Lake Resources (ASX:LKE) announced it has the ability to potentially increase lithium production.
- Separately commodity screens were quiet: Gold, Silver, Copper and Oil didn’t move much from the prior session.
- The iron ore spot price sank almost 6% seeing BHP and Rio in New York fall. So you might have your day to top up iron stocks today.
Trading ideas:
- After PointsBet Holdings (ASX:PBH) rose about 4% yesterday, Bell Potter reiterated the stock as a Speculative Buy with a $20.55 target.
- De Grey Mining (ASX:DEG), Sovereign Metals (ASX:SVM) and King Island Scheelite (ASX:KIS) are giving off bullish charting signals according to Trading Central
The futures are hinting that the Aussie market will rise 0.4% at the open. All eyes will be on travel and tourism stocks, with bookings on rise ahead of Easter, while also being supported by the governments incentive.
What to watch today
- Expect some caution as AstraZeneca’s vaccine was paused for use in France, Germany, Ireland and the Netherlands over blood clot concerns. This is important to watch as Australia has purchased 54 million doses.
- Investors will be watching the RBA Minutes to hear what the RBA says as to why the Aussie bond yields hit a 2-year high, as well as house price index data.
- Separately except commodity stocks to be mixed today as Gold rose 0.6% to US$1,730, Silver rose 1.6%, Copper trades flat, Lithium stocks rose in the US overnight, while the Oil price fell 0.5% to US$65.29.
- The iron ore fines price, the most traded, staged a rebound while the iron ore spot price rose 2.7%.
Trading ideas:
- Following Vitalharvest Freehold Trust (ASX:VTH) hitting a new record high yesterday, Bell Potter restated the stock as a Hold on the basis of its strong share price growth.
- Keep an eye on Woodside (ASX:WPL), a Macquarie, Credit Suisse and UBS Buy stock, benefitting from higher oil prices.
- Pilbara Minerals (ASX:PLS), Shaver Shop (ASX:SSG) and Reece (ASX:REH) are all giving off bullish charting signals according to Trading Central.
The futures are suggesting a flat start to the week – as Australian bond yields rose back to two-year highs again. So this week, we’ll likely see companies with higher debt like tech stocks sold down, and investors continuing to back banks, and airlines.
What to watch today:
- RBA Governor’s speech
- New home sales data out at 11:30am. That will keep building companies on the pulse – like CSR (ASX:CSR), Boral (ASX:BLD) and Brickworks (ASX:BKW).
- China’s industrial production data for Feb.Keep an eye on rare earths stocks like Lynas (ASX:LYC), Vital Metals (ASX:VML), Northern Minerals (ASX:NTU) and RareX (ASX:REE).
- S&P/ASX 200 and 300 changes for 22 March announced on Friday. Why is this important? Stocks added to the indices will now be compulsorily acquired by ETF providers and those that were removed will be sold.
- Keep a watch on iron ore stocks as the iron ore fines price, the most traded, fell almost 2% taking iron ore to a 15-day low. With China cracking down on steel production to cut pollution.
Trading ideas:
- Bell Potter reiterated Cyclopharm (ASX:CYC) as a Buy with a $3.79 target. CYC will be added to the All Ordinaries (the top 500) index.
- Noxopharm (ASX:NOX), Ava Risk Group (ASX:AVA) and Navigator Global Investment (ASX:NGI) are all giving off bullish charting signals according to Trading Central.
With business confidence at an 11-year high and consumer confidence tailing on a similar trajectory, it's safe to say the economic recovery is in full swing. However, with technical bearish signals now rearing their head, could it be short lived?
In this week’s wrap, Jessica covers:
- (0:21) Consumer confidence just shy of its 10-year peak
- (1:00) Tech stocks taking a hit: Zip (ASX:Z1P) down 12% (Mon-Thu)
- (1:57) Three travel stocks soaring after a government announcement
- (2:26) Why it could be worth keeping some cash at bay
- (3:30) How to find outperforming stocks
The futures are suggesting the market will end the week on a positive note, up 0.5%, with the AUD continuing to rise against the greenback.
US stocks climbed to record highs on Thursday as the comeback in tech shares resumed, while the signing of the $1.9 billion-dollar COVID-19 stimulus deal gave sentiment a further boost.
In other news, Johnson & Johnson’s one dose COVID-19 vaccine has been authorised by the European Union.
What to watch today:
- It’s worth keeping an eye on Aussie tech shares like Afterpay (ASX:APT) and Appen (ASX:APX) given the tech rally overnight.
- Travel and tourism stocks will continue to be in focus as the Federal Government added another 2 regional locations to its half price airfares scheme. This takes the total number of locations to 15.
- Oil prices stormed higher overnight. The WTI crude oil and Brent crude oil price were both up about 2%. Energy producers like Santos (ASX:STO) and Woodside (ASX:WPL) could finish the week strongly.
- Iron ore lifted 1.7%, gold and silver both fell about 0.2%, and copper rose 2.5%.
- Finally, keep an eye on some of the most traded stocks from yesterday for our active trader desk. They were Pureprofile (ASX:PPL), Ioupay (ASX:IOU) and Digital Wine Ventures (ASX:DW8).
Trading ideas:
- Acrow Formwork & Construction Services (ASX:ACF) remains a Bell Potter Buy with an increased price target of $0.44.
- Bell Potter reiterated its Buy recommendation on Imdex (ASX:IMD) with an unchanged price target of $2.20. IMD was able to grow margins and earnings despite a benign exploration environment in H12021.
- Separately –Nick Scali (ASX:NCK), Bingo Industries (ASX:BIN) and James Hardie (ASX:JHX) could be worth a look as they’re all giving off bullish charting signals according to Trading Central.
The futures are suggesting the market will open 0.5% higher – with the focus on travel stocks and banks.
What to watch today:
- Travel and tourism stocks will be in focus as the Federal Government will pay half price airfares for 800,000 Aussie visiting 13 regional areas from April 1 to July 31.
- Keep an eye on travel stocks in bullish short breakouts like Webjet (ASX:WEB), Flight Centre (ASX:FLT), Qantas (ASX:QAN) and Corporate Travel Management (ASX:CTD).
- Banks will also be in focus – with the Federal Government expected to expand its SME loan program offering interest free loans for up to $5 million over 10-years, 80% government backed.
- Keep an eye on banks stocks in share price breakouts: ANZ (ASX:ANZ), Auswide Bank (ASX:ABA), Macquarie Group (ASX:MQG).
- Keep an eye on iron ore stocks as the spot iron ore price continued to fall, losing 5% - after a Chinese city was ordered to halt steel production to limit pollution.
Trading ideas:
- Janus Henderson (ASX:JHG) and Link (ASX:LNK) are two of Citi’s favourite Buys in the non-banking financial space. Both are continuing to benefit from growing earnings.
- FYI Resources (ASX:FYI), TPG Telecom (ASX:TPG) and BSA Limited (ASX:BSA) are giving off bullish charting signals according to Trading Central.
The broad market is expected to rise 0.4% with tech stocks in focus.
This comes as the tables were turned last night – with investors smashing the ‘risk-on’ switch. This saw the Nasdaq lift 3.6%, its best gain in 4-months, while the broader S&P500 rose 1.4%
What to watch today:
- Yesterday, we saw the markets shorter-term 15-day average fall under the 30-day average. This is a bearish signal. It occurred last in September 2020 and then the market fell 5%.
- PayPal is set to launch its pay in four instalment options to 9-million Aussies in June – so Afterpay (ASX:APT) and Zip (ASX:Z1P) could be losing market share locally.
- Afterpay (ASX:APT) has just announced its launch into Europe has gone ahead of schedule, after it completed the takeover of BNPL provider Pagantis. And buy orders are stacking up in APT as well as Zip.
- EOS (ASX:EOS) was mentioned on the ABC – for allegedly working on a new weapon system for a defence force. So EOS is likely to see some extra buying.
- Keep an eye on some of the most traded stocks from yesterday: Redflow (ASX:RFX) which rose 43% and Digital Win Ventures (ASX:DW8) which rose 29%.
- Consumer confidence data out for March as well as new home sales and building permit data.
Trading ideas:
- Nickel Mines (ASX:NIC) was reiterated as a Bell Potter Buy with a $1.67 target despite China unveiling plans to boost nickel production.
- First Graphene (ASX:FGR), Graincorp (ASX:GNC) and Element 25 (ASX:E25) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is expected to lift 0.7% if the futures are correct with the focus to be on commodity and cyclicals stocks.
What to watch today:
- DDH1 (ASX:DDH) is expected to float on the ASX today at 1pm, the second biggest IPO this year.
- Lithium major and UBS buy, Galaxy Resources (ASX:GXY) are set to bounce after releasing its Preliminary Economic Assessment for its Quebec project in Canada. This allows Galaxy to advance the project straight into engineering phase.
- Resilient iron ore stocks could see a rally with the as the ire ore price 0.3% to US$173
- Oil stocks are likely to take a breather as the oil price fell over 2% overnight to US$64.
- Gold slumped to a new nine month low losing 1.2%
Economic news this week:
- Business confidence figures are released today
- New home sales data for Feb is out
Trading ideas:
- Calix (ASX:CXL) was given a big upgrade by Bell Potter overnight with a new $2.94 target.
- Praemium (ASX:PPS), Lovisa (ASX:LOV) and Humm (ASX:HUM) could be worth a look following bullish charting signals according to Trading Central.
The Aussie share market is likely to lift 1.6% or 107 points, after US stocks sharply rebounded at the weekend.
Keep in mind volume could be a bit lighter today as Victoria celebrates a public holiday.
What to watch today
- Oil and industrial stocks will likely charge following sentiment on Wall Street. Keep an eye on Oil Search (ASX:OSH) & Santos (ASX:STO).
- Expect locally listed BHP (ASX:BHP) and Rio Tinto (ASX:RIO) to rally after their US listed counterparts rose on Friday. RIO in NY rose 2% while BHP rose 0.5%.
- In the Lithium space, keep in mind US listed giants rose on Friday and Audi announced it’s moving to produce fully electric cars.
- St Barbara (ASX:SBM) and Newcrest Mining (ASX:NCM) could be a little lackluster after the safe haven commodity, Gold, fell to its lowest level in nine months on Friday.
- Copper stocks could see a rebound after Copper jumped 4%.
- Eco news this week: Business confidence is out tomorrow and Consumer Confidence is out Wednesday.
Trading ideas:
- UBS upgraded Centuria Industrial REIT (ASX:CIP), increasing its price target to $3.54.
- Service Stream (ASX:SSM), IGO (ASX:IGO), Vulcan Energy (ASX:VUL) are all giving off bullish charting signals according to Trading Central.
The Aussie share market lifted 1.3% (Mon-Thu) breaking its two-week losing streak. With a record trade surplus announced, and unparalleled economic growth... it seems the economic pandemonium created by the pandemic is history. However, with prices and interest rates now rising, where do you invest now?
In this week’s wrap, Jessica covers:
- (0:30) Financials outperforming, up 5% with Commonwealth Bank (ASX:CBA) notching its biggest gain in five-weeks
- (0:38) CSL shares falling to a 2.5-year low. Is it time to buy CSL?
- (1:34) Rare-earth companies to watch following a shift in Chinese policy
- (2:25) 'Bond yields' rising and why this shouldn't cause alarm
- (4:07) What's driving the lithium price, and two stocks to consider
- (4:46) Four stocks that could fly, if you're looking for growth
The broad Aussie market is expected to retreat 0.3% or 17 points –after gaining 1.3% this week.
What to watch today:
- Keep an eye on BHP (ASX:BHP) and Rio Tinto (ASX:RIP) – both stocks are in short term breakouts and growing their earnings, which is supported by the commodity rally.
- The Iron ore price rose 0.5% overnight to US$175, hot on the heels of a 10-year high, and it’s likely to move further north until Vale’s production returns to its normal state.
- Elsewhere, Gold, Silver and Copper stocks could see some pressure again today as their base metal prices fell sharply for the second day.
- Keep an eye on some of the most traded stocks from yesterday: BlackEarth Minerals (ASX:BEM) rose 25%, BPH Energy (ASX:BPH) fell 36%, and up and coming rare earth developer Vital Metals (ASX:VML) fell 15%.
- Services sector data is out today for February expected to show the sector is continuing to slowly grow – keep an eye on pub owners companies like Redcape Hotels (ASX:RDC) and ALE Property Group (ASX:LEP).
Trading ideas:
- Citi upgraded ARB Holdings (ASX:ARB) with a beefed up target of $45.15 after the business announced its ramping up its European operations.
- GrainCorp (ASX:GNC) had its Bell Potter Buy rating reiterated with a $5.20 target.
- Ava Risk Group (ASX:AVA), Motorcycle Holdings (ASX:MTO) and Imdex (ASX:IMD) are all giving off bullish charting signals according to Trading Central.
The broad Aussie market is expected to retreat 0.6% as investors roll out the playbook – and rotate to stocks benefiting from higher prices.
Investors are continuing to re-adjust their portfolios after bond yields rose again overnight.
What to watch today:
- Gold, Silver and Copper stocks are likely to see some profit taking as their base metal prices fell over 1% overnight.
- Nickel rose 0.6% overnight and Iron Ore rose 0.8%. So keep an eye on stocks in breakouts/seeing strong rallies in these areas like: Nickel Mines (ASX:NIC), Mount Gibson Iron (ASX:MGX), BHP (ASX:BHP), Fenix Resources (ASX:FEX) and Magnetite Mines (ASX:MGT).
- Keep an eye on some of the most traded stocks from yesterday: Vital Metals (ASX:VML) and Hawkstone Mining (ASX:HWK).
- Balance of trade data for January is out today – this tells us how much Australia paid for its imports and received for its exports.
- Retail sales data for January is out today – it’s expected to show sales grew 0.6% in January so keep an eye on consumer spending stocks.
Trading ideas:
- PSC Insurance (ASX:PSI) is a Bell Potter Buy, with an upgraded price target of $3.90, implying 16% upside.
- Elders (ASX:ELD) is a Bell Potter Buy with an increased price target of $13.60 target as its wool and crop businesses delivered stronger than expected earnings.
- SenSen Networks (ASX:SNS), West African Resources (ASX:WAF) and Australian Finance Group (ASX:AFG) are all giving off bullish charting signals according to Trading Central.
The futures are suggesting the Aussie share market will lift 0.2% thanks to commodities charging.
What to watch today
- Gold stocks like Newcrest Mining (ASX:NCM) and St Barbara (ASX:SBM), which are both are in downtrends and momentum is building in a southern direction. So, it could be worth waiting if you are looking at buying into these stocks.
- Keep an eye on Copper stocks with strong share price and earnings momentum: Oz Minerals (ASX:OZL) and Sandfire Resources (ASX:SFR).
- In smaller caps, keep an eye on Aeris Resources (ASX:AIS) and Copper Mountain Mining Corporation (ASX:C6C).
- Keep an eye on some of the most traded stocks from yesterday for our active trader desk, Bell Direct Advantage. They were Peppermint Innovation (ASX:PIL) and Cannindah Resources (ASX:CAE).
- Economic data out today: economic growth data for the last quarter of 2020.
Trading ideas:
- BCI Minerals Ltd (ASX:BCI) was given a little upgrade overnight. Bell Potter maintained its Buy rating in BCI, increasing its target to $0.50, implying 64% upside.
- UBS reiterated its Buy recommendations on CSL (ASX:CSL) overnight with a $330 target.
- Suncorp (ASX:SUN), Deep Yellow (ASX:DYL) and JB Hi Fi (ASX:JBH) are giving off bullish charting signals according to Trading Central.
Almost in a reverse of what we’ve seen over the last week, the Nasdaq surged 2.9% and the S&P500 rose 2.4%. Investors bought heavily into big tech giants and economic recovery stocks, and sold down on bonds. So long-term interest rates have fallen and importantly they’ve also stabilised, proving the risk on mood is back.
The futures are suggesting the Aussie share market will lift 0.7%, which will be a nice addition to yesterday’s 1.7% push up.
What to watch today:
- Tech stocks will see a lot of action today - after pulling back 13% last week.
- Agricultural stocks like Elders (ASX:ELD), Greenlane Renewables (ASX:GRN), Nufarm (ASX:NUF) and Rural Funds Group (ASX:RRF), as the Ag-body ABARES is forecasting the sector will recover $66b of their produce this year.
- Aged care companies like Estia (ASX:EHE) and Regis (ASX:REG) who are likely to receive an extra $452m in funding in the wake of the Aged Care Royal Commission.
- Building permits are out today for Jan - the market expects permits to have fallen 3% in Jan.
- The RBA meets today – all eyes will be on stimulus - as in how much more bonds will be bought to keep the AUD low.
Trading ideas:
- Atomo Diagnostics (ASX:AT1) was initiated as a Bell Potter speculative Buy with a $0.60 target, implying 155% upside.
- UBS increased its Buy recommendations on Nufarm (ASX:NUF) with a $5.70 price target.
- BlueScope Steel (ASX:BSL), Straker Translation (ASX:STG) and OFX Group (ASX:OFX) are all giving off bullish charting signals according to Trading Central.
A bit of a rebound is on the cards to kick off March. The futures are suggesting the Aussie share market will lift 0.4% at the open.
This comes as the iron ore price rose, while big US tech names rebounded at the weekend, as bond yields retreated from their one-year peak.
What to watch today:
- Tech stocks are expected to see a bit of excitement and buying the dip action today.
- Cyclical stocks like banks, energy, mining and industrial companies, could see some extra buying this week.
- Keep your eye on aged care companies: Estia (ASX:EHE) and Regis (ASX:REG) as the Aged Care Royal Commission is due to hand down about 100 recommendations for the sector today.
- Commodity stocks will see mixed action today. Oil fell 3% to US$61.50. Gold tumbled 3%. Silver fell 3%. Iron ore rose 0.6% and the coal price rose almost 2%.
- Eco data out this week: home loan application data for Jan is out today, the RBA meets tomorrow to decide on interest rates & economic growth data for the last quarter of 2020 is out on Wednesday.
Trading ideas:
- BWX (ASX:BWX) had its Buy rating upgraded by Bell Potter, with an increased $5.40 target. BWX was upgraded factoring in new partnerships, sales agreements, and its increased global presence.
- UBS reiterated its Buy recommendation on coal giant, Whitehaven Coal (ASX:WHC) with a $2.30 price target. With the stock WHC up 25% in 6-months, and coal prices continuing to recover, UBS sees stronger returns to shareholders.
- OFX Group (ASX:OFX), Macmahon Holdings (ASX:MAH) and Mortgage Choice (ASX:MOC) are giving off bullish charting signals according to Trading Central.
This week marked, not only the last but, the busiest week this reporting season. Despite most companies beating expectations, the Aussie share market dropped 1.2% this week (Mon-Fri) after the 10-year bond yield jumped 1.6% to a one-year high.
In this week’s wrap, Jessica covers:
- (0:16) Why the market dipped despite a good report card
- (0:45) The Energy sector leading the way, rising 5%
- (1:31) What caused the Tech sector to see its biggest drop in a year
- (2:16) The economic forecast: what to expect in the future
- (3:06) The stock upgrades and downgrades following reporting season
US stocks saw their biggest pull back since October with the Nasdaq falling 3.5% and the Dow losing 1.8%. It comes as investors are concerned that long-term interest rates, as measured by the US treasury yield rose 1.6% to a one-year high.
Following the pull back in global equities, the Aussie share market is tipped to fall 1.4%, which will erase this week’s rise.
What to watch today:
- Tech stocks are expected to pull back. The tech index is already down 8% this week, which is its biggest fall drop since COVID-19 hit in March 2020.
- Afterpay (ASX:APT) looks like it will come out of a trading halt. APT announced its increased its capital raising to $1.5b and plans to list in Singapore to launch in Asia.
- It’s the last official day of Earnings Season. Kogan (ASX:KGN) reported its profit more than doubled in the half year to $23.6m, after revenue jumped 90%.
- Other results to watch: HSN, AEF, AFG, ORE, LYC, OPT, PNV, CUV, HVN, BUB, BWX, EOS and ASB.
- Commodity stocks will see mixed results today as the oil price rose 0.4% to US$63.47 – its highest level in a year and Copper fell from its 9.5 year high, falling 1.9%. Gold slipped 1.6% .
Trading ideas:
- Alcidion (ASX:ALC) had it Buy rating upgraded by Bell Potter, with an increased $0.30 target - on rising levels of demand, particularly in the UK and Europe, where it’s gaining new contracts.
- Eagers Automotive (ASX:APE) was reiterated as a Bell Potter Buy with a $15.50 price target after the company said its order book is remaining strong, despite COVID-19.
- Galan Lithium (ASX:GLN), Chalice Mining (ASX:CHN) and Piedmont Lithium (ASX:PLL) are giving off bullish charting signals according to Trading Central.
The broad Aussie share market is down 0.2% this week, but the futures are suggesting a 0.7% rebound.
Local tech stocks are down 8.5% this week, that’s the tech sectors biggest drop since March last year.
What to watch today:
- Afterpay (ASX:APT) reported net transaction margin rose much more than expected, while it reported a loss when the market expected a profit. They also announced a $1.25 billion capital raise.
- Other company results to watch: Z1P, LNK, FLT, QAN, RRL, GXY, ILU, SFR, GOZ, MSB, HUB, PGL, IFM, SXL, QUB, SSM, and TPG.
- Commodity stocks are expected to rally again
- Engineering, construction and developing companies could turbocharge in Queensland as Brisbane has been named as the ‘preferred city’ to host the 2032 Olympic Games.
Trading ideas:
- Bell Potter upgraded Acrow Formwork & Construction Services’ (ASX:ACF) Buy rating with an increased $0.42 target as ACF continues to benefit from the lift in construction and infrastructure developments.
- Bell Potter upgraded City Chic Collective’s (ASX:CCX) Buy rating with a price target of $4.60 after the company saw earnings rise more than expected.
- oOh!media (ASX:OML), Gascoyne Resources (ASX:GCY) and Hastings Technology (ASX:HAS) are all giving off bullish charting signals according to Trading Central.
The Aussie share market is likely to pull back 0.4% - which could rub out half of yesterday’s gain of 0.9%.
Commodity stocks are expected to charge again today, while tech stocks will likely move to a lower-gear following moves in overseas markets.
What to watch today:
- The Iron Ore price hit a brand new 9.5-year high - US$175.50 – a level not seen since September 2011 as China demand remains strong and doubts about Brazilian shipments from Vale, the world’s top producer, linger on.
- Copper rose 1.6%; the Coffee price hit a 2.5 year high and Oil holds steady at US$61.64.
- Appen (ASX:APX) upgraded its outlook for FY21 expecting earnings to lift up to 28%.
- Blackmores’ (ASX:BKL) profit beat expectations coming in at $18.9 million, beating the $9.1m expected
- Woolworths (ASX:WOW) has declared its strongest half-year dividend in six years.
- Mount Gibson Iron’s (ASX:MGX) half-year profit surged 67% on higher iron ore prices, despite sales falling.
- Silver Lake Resources (ASX:SLR) profit rose 48%.
- Other companies reporting: Sydney Airport (ASX:SYD), WiseTech Global (ASX:WTC), Healius (ASX:HLS), Viva Energy (ASX:VEA), Helloworld (ASX:HLO).
Trading ideas:
- Bell Potter upgraded Mader Group’s (ASX:MAD) Buy rating with an increased $1.28 price target.
- Bell Potter upgraded Monadelphous’ (ASX:MND) Buy rating with a price target of $14.40.
- Austral Gold (ASX:AGD), Uniti Group (ASX:UWL) and Iron Road (ASX:IRD) are giving off bullish charting signals according to Trading Central.
The Aussie share market futures are suggesting a 0.2% rebound. Commodity stocks are set to lift the market, while the vaccine rollout continues to lift sentiment - with Australia awaiting the second shipment of Pfizer vaccines today.
What to watch today:
- Commodity stocks will dominate headlines and will likely continue to do so this year as prices continue to rise on Chinese demand and lack of supply.
- Iron ore darling stocks like Fortescue Metals (ASX:FMG), BHP (ASX:BHP), Rio Tinto (ASX:RIO) and Mineral Resources (ASX:MIN).
- Oil stocks will be in focus – Oil price jumped 4% to US$61.69 – with the price likely to continue to push up, as US oil rigs remain shut due to a cold weather snap, while oil demand continues.
- Silver and copper stocks also on the radar – Silver rose 3.5% and Copper surged 1.5%
- Results out of the gate today:
- Adbri (ASX:ABC) - NPAT hit $93.7m, which is weaker than the $104m expected.
- Alumina (ASX:AWC) announced profit fell 31% to $US147m. Disappointing shareholders expecting US$183m.
- HUB24 (ASX:HUB) announced its profit rose 19% in the half-year and it declared a record dividend.
- Macmahon Holdings (ASX:MAH) announced its profit rose 56% in the half-year to $44.8 million.
Trading ideas:
- Bell Potter upgraded Costa Group’s Ltd (ASX:CGC) Buy rating with an increased $5.10 price target after CGC’s profit rose 100%.
- Bell Potter reiterated Senex Energy’s (ASX:SXY) Buy rating with a price target of $0.46.
- Champion Iron (ASX:CIA), Piedmont Lithium (ASX:PLL) and NZME (ASX:NZM) are all giving off bullish charting signals according to Trading Central.
The Aussie share market futures are suggesting a 0.2% fall.
Australia’s vaccine rollout begins today and it’s the final hurrah week of reporting season with results out from LendLease Group (ASX:LLC) and NIB Holdings (ASX:NHF) today, plus Afterpay (ASX:APT) and Zip (ASX:Z1P) on Thursday.
Australian wage data is out for the quarter on Wednesday – expected to show wage growth slowed from 1.4% to 1.1% over the year.
What to watch today:
- Copper – the Copper price rose 3.9% to a new nine-year high on strong Chinese demand – so watch large caps: BHP (ASX:BHP), OZ Minerals (ASX:OZL), Sandfire Resources (ASX:SFR) and in small caps watch: Castillo Copper (ASX:CCZ), Aeris Resources (ASX:AIS) and Hot Chili (ASX:HCH).
- BlueScope Steel (ASX:BSL) reported its first-half net profit after tax jumped 78% from a year ago, to $330.3m, beating expectations of $311m.
- Costa Group (ASX:CGC) reported a massive 108% increase in NPAT to $59.4m in 2020, surging past expectations.
- Other results to watch: BIN, CNU, EVT, GDI, LLC, NHF, NWH, OML, RWC.
- Keep an eye on some of the most traded stocks from Friday: Pursuit Minerals (ASX:PUR) which gained 32% and Integrated Payment Technologies (ASX:IP1) which fell 28%.
Trading ideas:
- Citi upgraded QBE Insurance’s (ASX:QBE) Buy rating with an increased $10.95 price target.
- Bell Potter upgraded Adacel Technologies’ (ASX:ADA) Buy rating with a higher price target of $1.25.
- Centaurus Metals (ASX:CTM), NRW Holdings (ASX:NWH) and Weebit Nano (ASX:WBT) are giving off bullish charting signals according to Trading Central.
The Aussie share market hit a new yearly high, for the fourth week in a row, after lifting 1.2% (Mon-Thu). The rally has been spurred on by positive economic news, like the unemployment rate falling to a nine-month low.
In this week’s wrap, Jessica covers:
- (0:58) Materials rising 4.2% following stronger than expected results and record high dividends
- (1:15) EML Payments' (ASX:EML) shares charging on record revenue
- (2:43) The underdogs of 2020 shining this reporting season
- (3:50) What the rising Aussie dollar means for investors...
- (4:43) How the oil price climb could affect your portfolio
The Aussie share market is likely to close over 1% higher this week, and hopefully erase last week’s fall.
What to watch today:
- Australia’s biggest industrial and logistics property group Goodman Group (ASX:GMG) reported a 29% jump in profit to $1 billion in the half-year, almost double what the market expected.
- Cochlear’s (ASX:COH) half-year profit rose 50% to $236.2m, despite the pandemic, while the market was only looking for profit of $64.4m.
- Jewellery chain Lovisa (ASX:LOV) reported a half-year profit after tax of $21.5m, that’s a fall of 23%. But LOV’s profit is stronger than the $18.1m the market expected.
- Other companies reporting include: Cleanaway (ASX:CWY), Inghams (ASX:ING), Medical Developments International (ASX:MVP), Pact Group Holdings (ASX:PGH), QBE Insurance (ASX:QBE) and Smartgroup Corporation (ASX:SIQ).
- Preliminary retail sales are out today – expected to show a 2.1% rise.
Trading ideas:
- IPH Limited (ASX:IPH) was upgraded by Bell Potter with a new $8.15 price target following improved earnings in Asia.
- Santos (ASX:STO) had its Buy rating upgraded by UBS with a new $7.90.
- Veem (ASX:VEE), Andromeda Metals (ASX:ADN) and Dicker Data (ASX:DDR) are all giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.3% at the open.
Locally, Victoria’s 5-day COVID-19 lockdown has finished, and Facebook has restricted news viewing and sharing in Australia.
Unemployment data will be released at 11:30am with the rate expected to fall from 6.6% to 6.5% in January.
Australian Banking Associated reported 91% of pandemic deferred loans are now being repaid.
Results highlights:
- CSL (ASX:CSL), Australia’s third biggest company on the ASX declared a record dividend of US$1.04 per share in the half year after net profit jumped 45% to US$1.8 billion. CSL is a UBS buy with a $339 target.
- Rio Tinto (ASX:RIO) reported a full year dividend of US$4.64 per share. RIO is a buy for Macquarie and Citi.
Companies reporting today:
- Fortescue Metals (ASX:FMG), Pilbara Minerals (ASX:PLS), Coca-Cola Amatil (ASX:CCL), Star Entertainment (ASX:SGR), Wesfarmers (ASX:WES), Santos (ASX:STO), Woodside Petroleum (ASX:WPL) and Origin Energy (ASX:ORG).
Yesterday’s top traded stocks:
- Province Resources (ASX:PRL) rose 457%, Credit Intelligence (ASX:CI1) rose 31%, Cirralto (ASX:CRO) gained 16% and Fatfish (ASX:FFG) fell 33%.
Local trading ideas:
- Corporate Travel Management (ASX:CTD) was upgraded by Bell Potter with a new $22 price target.
- Bell Potter reiterated Domino's Pizza (ASX:DMP) as a buy with a $122.00 price target.
- Pact Group (ASX:PGH), Maca (ASX:MLD) and Archer Materials (ASX:AXE) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.3% at the open.
The Therapeutic Goods Administration (TGA) approved AstraZeneca’s COVID-19 vaccine for use in Australia with it being produced in Melbourne by CSL (ASX:CSL).
Bitcoin has reached US$50,000 after skyrocketing from US$5,000 2-years ago.
Companies reporting:
- Fortescue Metals (ASX:FMG), Rio Tinto (ASX:RIO), Mount Gibson Iron (ASX:MGX), Whitehaven Coal (ASX:WHC), Sonic Healthcare (ASX:SHL), Coles (ASX:COL) and Domino’s Pizza (ASX:DMP).
Local trading ideas:
- UBS upgraded BHP (ASX:BHP) with a new $50 price target.
- Empired (ASX:EPD), Evolution Mining (ASX:EVN) and Zip (ASX:Z1P) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.3% at the open.
The World Health Organisation said global daily COVID-19 have now dropped for 5 straight weeks, and US cases are at their lowest level since October.
Frontline health workers and those in aged care will be the first to receive one of the 162,000 Pfizer COVID-19 vaccines that arrived in Australia yesterday, a part of the 20 million doses Australia ordered.
The RBA minutes will be released today.
Companies reporting:
- NAB (ASX:NAB) reported quarterly earnings rose 1% to $1.65 billion and unaudited statutory net profit hit $1.7 billion in the December quarter.
- Breville (ASX:BRG) announced its half year net profit jumped 29% in the half year, supported by strong revenue growth from the shift to working from home (WFH).
- Adairs (ASX:ADH) half year profit skyrocketed 233% to $43.9m benefiting from WFH, what’s key is online sales now contribute about 40% of group sales.
Local trading ideas:
- UBS upgraded Altium (ASX:ALU) from a hold to a buy with a $34.00 target.
- Incitec Pivot (ASX:IPL) was upgraded by UBS with a new $2.85 target.
- Accent Group (ASX:AX1), ReadCloud (ASX:RCL) and Nickel Mines (ASX:NIC) are giving off bullish charting signals according to Trading Central.
Aussie shares are likely to lift 0.6% to kick off the week, hopefully erasing Friday’s 0.6% fall.
80,000 Pfizer vaccine doses arrive in Australia this week to be stored at -70 degrees with DHL ready to despatch.
What to watch today:
- In the wake of restrictions, we could see further earnings squeezes in travel stocks like Transurban Group (ASX:TCL), Webjet (ASX:WEB), Flight Centre (ASX:FLT) and Qantas (ASX:QAN).
- Crown Resorts (ASX:CWN) shares look likely to continue their slide.
- Company results today: JB Hi FI (ASX:JBH), Bendigo and Adelaide Bank (ASX:BEN), Aurizon Holdings (ASX:AZJ), Cooper Energy (ASX:COE), Beach Energy (ASX:BPT) and QBE Insurance (ASX:QBE).
- Keep an eye on some of the most traded stocks from Friday including: Ioupay (ASX:IOU) which rose 158%, BARD1 Life Sciences (ASX:BD1) which rose 177% and Douugh (ASX:DOU) which gained 47%.
- Economic front: New home sales out today and unemployment figures are out on Thursday.
Trading ideas:
- Citi reiterated Baby Bunting (ASX:BBN) as a buy. BBN’s new target is $6.22
- Mirvac (ASX:MGR) was reiterated as a buy by UBS albeit with a slimmer $2.76 target following its results.
- Hansen Technologies (ASX:HSN), Evolve Education (ASX:EVO) and RPMGlobal Holdings (ASX:RUL) are all giving off bullish charting signals according to Trading Central.
The Aussie share market hit a brand new 12-month high. With 65% of reported companies smashing expectations, and the market remaining in a technical breakout, it seems the bullish flag is continuing to be raised. However, there's still plenty to be across this reporting season.
In this week’s wrap, Jessica covers:
- (0:26) The technical and fundamental trends supporting share market growth
- (1:07) Zip (ASX:Z1P) outperforms the market, rising 24% (Mon-Thu)
- (2:10) Gold glistening: four noteworthy stocks to consider
- (2:35) Iron ore continuing to deliver the goods
- (3:24) Bank profits recovering but dividends disappointing
- (4:00) A promising trend emerging
The ASX200 is eyeing a flat open.
Companies reporting results:
- Mirvac Group (ASX:MGR) reported a 36% drop in attributed half-year profit to $351.5 million.
- Arena REIT (ASX:ARF) reported its net profit rose 45%.
- Baby Bunting (ASX:BBN) reported its net profit rose 55% in the year but didn’t give future guidance amid COVID-19 uncertainty.
- Genworth Mortgage Insurance (ASX:GMA) results revealed an annual loss of $107.6 million and it declared it won’t pay a final dividend.
Yesterday’s top traded stocks:
- Zip (ASX:Z1P), Rent.com.au (ASX:RNT), Renascor Resources (ASX:RNU) and Fortescue Metals (ASX:FMG).
Local trading ideas:
- GrainCorp Ltd (ASX:GNC) was upgraded by Bell Potter following its better than expected trading update.
- AMP (ASX:AMP) was upgraded to a Bell Potter buy with a $2.25 price target.
- VRX Silica (ASX:VRX), Whispir (ASX:WSP) and Kathmandu Holdings (ASX:KMD) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.5% at the open.
The Head of the Reserve Bank in the US assured Americans that interest rates will stay low until employment rates return to normal levels.
Companies reporting results:
- Telstra (ASX:TLS) reported net profit after tax (NPAT) of $1.1 billion, which exceeded the expectation of $849 million.
- AMP (ASX:AMP) reported full year statutory NPAT of $177 million, reversing the $2.5 billion loss in FY19.
Yesterday’s most traded stocks:
- Large caps: Fortescue Metals (ASX:FMG), InvoCare (ASX:IVC) and Suncorp (ASX:SUN).
- Small caps: BlackEarth Minerals (ASX:BEM).
Local trading ideas:
- Praemium (ASX:PPS) was reiterated as a buy by Bell Potter with new $1.01 target.
- Australian Strategic Materials (ASX:ASM), Resimac Group (ASX:RMC) and Charter Hall Group (ASX:CHC) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.1% at the open.
Companies reporting today:
- Commonwealth Bank (ASX:CBA), Insurance Australia Group (ASX:IAG), CIMIC (ASX:CIM), Megaport (ASX:MP1), Centuria (ASX:CNI) and Mineral Resources (ASX:MIN).
Yesterday’s most traded stocks:
- Large caps: Zip (ASX:Z1P), ANZ Bank (ASX:ANZ) and Amcor (ASX:AMC) which all lost over 1% yesterday.
- Small caps: Reedy Lagoon (ASX:RLC) rose 176%, Flexiroam (ASX:FRX) fell 28% and Stemcell (ASX:SCU) rose 30%.
Local trading ideas:
- Macquarie expects Fortescue Metals (ASX:FMG) shares to rally up to $26.50.
- Alcidion (ASX:ALC) was initiated as a buy by Bell Potter with a $0.28 target. Alcidion tech is already being used by Queensland Health and in Scotland.
- Sealink (ASX:SLK), Infomedia (ASX:IFM) and MNF Group (ASX:MNF) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.2% at the open ahead of some property businesses reporting results on the effect of reduced rent and vacancies due to COVID-19.
Keep an eye on some of the most traded stocks from yesterday:
- Zip (ASX:Z1P) rose 13% and is suggested to rally again. Rent.com.au (ASX:RNT) gained 24% yesterday and early orders suggest another rally could be on the cards. Flexiroam (ASX:FRX) rose 95% yesterday.
Companies reporting today:
- Dexus (ASX:DXS), Shopping Centres Australasia (ASX:SCP), James Hardie (ASX:JHX), Boral (ASX:BLD), Emeco (ASX:EHL), Challenger (ASX:CGF) and Suncorp (ASX:SUN).
Local trading ideas:
- IMDEX (ASX:IMD) was upgraded by Bell Potter following its better than expected earnings results handed down yesterday. IMD is a Bell Potter buy with an increased price target of $2.20.
- Citi reiterated Elders (ASX:ELD) as a buy with a $13 target.
- Super Retail Group (ASX:SUL), BSA (ASX:BSA) and Andromeda Metals (ASX:AND) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.1% at the open.
The US unemployment rate fell to 6.3% in January, this was better than the projected 6.7% as Americans continue to head back to work. The US Democrats moved forward in the process of passing a $1.9 trillion COVID-19 relief bill without Republican votes.
Imdex (ASX:IMD) and Charter Hall Long WALE REIT (ASX:CLW) report results today.
Local trading ideas:
- UBS marked Cochlear (ASX:COH) as a sell, forecasting revenue and sales to decline in the half year.
- Bell Potter increased Cyclopharm’s (ASX:CYC) speculative buy rating with a new price target of $3.40.
- Immutep (ASX:IMM) had its speculative buy rating upgraded with a new $0.65 target by Bell Potter.
- Andromeda Metals (ASX:AND), Reckon (ASX:RKN) and Kingston Resources (ASX:KSN) are giving off bullish charting signals according to Trading Central.
The market hit a 12-month high this week, rising 3% (Mon-Fri 10:30am) - that's the ASX200's best gain in 13-weeks. In keeping with tradition, better than expected company news, earnings results, and economic stimulus have driven this surge. But with a marked increase in retail investor trading in small and mid-sized companies, caution is advised...
In this week’s wrap, Jessica covers:
- (0:22) The soaring market. All sectors doing well except Utilities
- (0:55) Credit Corp (ASX:CCP) rising 18%, after a good report card
- (1:27) Home loans reaching record highs in December
- (2:03) What'll be hot next week - key earnings results
- (3:00) Two oil stocks to watch
- (4:08) Where to be cautious amongst the retail investor buying frenzy
The ASX200 is eyeing a rise of 1% at the open.
Unemployment claims fell to 779,000 last week, less than the 830,000 claims expected.
What to watch today:
- Companies reporting: News Corp (ASX:NWS) and REA Group (ASX:REA).
- Charter Hall (ASX:CHC) holds it AGM.
- Keep an eye on lithium companies given the hype from Wall Street. Australia’s Energy Minister Angus Taylor is also encouraging the government to think about how electrical vehicles could be charged without compromising the grid. This will help the Aussie Government meet the goal of zero emissions by 2050. Some companies to keep an eye on are Galaxy Resources (ASX:GXY), Orocobre (ASX:ORE) and Pilbara Minerals (ASX:PLS).
Local trading ideas:
- Bell Potter raised Afterpay's (ASX:APT) price target to $168.50.
- Centuria Capital (ASX:CNI), GWA Group (ASX:GWA) and Baby Bunting (ASX:BBN) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.3% at the open following the market rising to its highest level in almost 12 months.
US equities charged for the third straight day, driven by better than expected company news and earnings results.
What to watch today:
- Investors will be weighing up that Victoria’s plan for the return to work to be at 75% capacity on Monday has been paused.
- Companies reporting: Nick Scali (ASX:NCK), Centuria Office REIT (ASX:COF) and Janus Henderson Group (ASX:JHG).
- Balance of trade (import and export) numbers for December will be released today at 11:30am.
Local trading ideas:
- Tech-air traffic control company, Adacel Technologies (ASX:ADA) was reiterated as a buy by Bell Potter, with a $1.15 target noting that there is a reasonable chance that Adacel will upgrade its FY21 guidance when it reports on the 18th of February.
- Fortescue Metals (ASX:FMG) was upgraded from a hold to a buy by Credit Suisse with a $23.50 target.
- Premier Investment (ASX:PMV), Chesser Resources (ASX:CHZ) and Whisper (ASX:WSP) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a 0.9% gain at the open following Wall Street’s gains and the RBA pledging to keep rates on hold until 2024.
What to watch today:
- Companies reporting: Amcor (ASX:AMC) and BWP Trust (ASX:BWP).
- The government pledged $10 million to reopen a tungsten mine, so keep an eye on King Island Scheelite (ASX:KIS).
- RBA Governor Philip Lowe will speak about the year ahead at 12:30pm.
Local trading ideas:
- GR Engineering (ASX:GNG) was upgraded by Bell Potter with a $1.45 target.
- Following Centuria Industrial REIT’s (ASX:CIP) results being released, UBS maintained CIP as a buy. The highlight of the result was CIP renewed leases with Woolworths in NSW.
- Ava Risk Group (ASX:AVA), Southern Cross Media (ASX:SXL) and Charter Hall Social Infrastructure REIT (ASX:CQE) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.8% at the open.
The S&P500 and NASDAQ gained 1.6% and 2.6% respectively.
GameStop shares fell 32% after it gained 400% last week.
What to watch today:
- Commbank (ASX:CBA) reported a 0.2% increase in its mandatory capital following the sale of its life insurance business.
- The oil price gained 2.8% with Saudi’s supply cuts kicking in. Demand is also likely to rise as one of the worst snowstorms hit the northwest US.
- The RBA will meet for the first time this year with rates expected to hold at 0.1%.
Local trading ideas:
- Mesoblast (ASX:MSB) was reiterated as a speculative buy by Bell Potter with a $5.10 target, implying 102% growth from yesterday’s close.
- Healius (ASX:HLS) was upgraded by UBS from a sell to a buy with a price target of $4.40.
The Aussie market futures are suggesting we’re in for a negative start, a fall of 0.5%.
Over in the US, there was a buying frenzy in silver stocks, as Reddit investors took vengeance on the likes of JP Morgan who betted the price of silver would go down. Secondly, GameStop shares jumped 68% after Robinhood re-allowed buying in the stock.
What to watch today:
- Perth has entered a five day lockdown, while Queensland opened its border to Sydney.
- So expect Woolworths (ASX:WOW), Coles (ASX:COL) and IGA Owner Metcash (ASX:MTS) to do well following the frenzy buying
- And expect Dreamworld owner Ardent Leisure (ASX:ALG) to get a kick.
- The Gold price rose 0.5%. But the real show stopper - will be Silver, after its price jumped 2.5%. Keep an eye on Silver Mines (ASX:SVL) +10%, Manuka Resources (ASX:MKR) +8%, Investigator Resources (ASX:IVR) +5% and in the large caps, South32 (ASX:S32) is seeing some early buy orders.
- Nickel-cobalt company GME Resources (ASX:GME) as its shares have been rallying as traders were mistaking its shares for GameStop which has the same ticker in the US.
- The PM will give his first speech outlining the Government’s strategy for 2021, including spending $1.9 billion in vaccine efforts.
- Home loan data is out for December.
Trading ideas:
- Media company, Access Innovation (ASX:AIM) was reiterated as Bell Potter buy with a $1.35 target.
- Origin Energy (ASX:ORG) was ear marked as a UBS buy on its sales volumes increasing. UBS has a $6.65 target for ORG. It last traded at $4.74.
- ReadCloud (ASX:RCL), Evolve Education (ASX:EVO) and Enero Group (ASX:EGG) are all giving off bullish charting signals according to Trading Central.
With reporting season upon us, we share what you need to watch ahead of a company releasing their financial results. We know the signs are there that the Aussie economy has been strengthening and company earnings have started to pick up, but what's key to driving share price growth now?
In our reporting season preview, Jessica covers:
- (1:00) The expected 20% growth in broad market earnings
- (1:12) The stocks exposed to consumer spending
- (1:46) Seven key mining stocks set to benefit
- (2:32) Two banking stocks worth keeping an eye on
- (2:59) Sectors set to gain and lose from the working from home shift
- (3:26) Why Cochlear (ASX:COH) and Fisher & Paykel (ASX:FPH) may miss expectations
The ASX200 is eyeing a lift of 1.1% at the open.
GameStop (NYSE:GME), the centre of a Reddit-user buying frenzy, saw its shares fall 44% after Robinhood and Interactive Brokers placed restrictions on trades.
What to watch today:
- The iron ore price fell 0.4% overnight and oil stocks could come under pressure as the oil price fell 1.2%.
- Fortescue Metals (ASX:FMG), Galaxy Resources (ASX:GXY) and IOOF (ASX:IFL) report quarterly production today.
Local trading ideas:
- Car dealership business, Eagers Automotive (ASX:APE) was upgraded to a buy by Bell Potter, with a $15.50 price target as its earnings are growing more than expected and are likely to continue.
- Genetic Signatures (ASX:GSS) was reiterated as a Bell Potter speculative buy, with a slimmer $3.20 target.
- Yancoal Australia (ASX:YAL), Platinum Asset Management (ASX:PTM) and 5G Network (ASX:5GN) are giving off bullish charting signals according to Trading Central.
The Aussie share market is set to open 1.09% lower to 6,631 following a volatile trading session overnight on Wall Street. This volatile session saw the Volatility Index (VIX) surge more than 50% to top $34, its highest level since November.
Apple reported its first-quarter earnings report for fiscal 2021, crossing the symbolic $100 billion mark in a single quarter with sales up 21% year-on-year.
As expected, the US Fed Reserve made no changes to its monthly bond purchases, keeping the interest rates near zero.
What to watch today:
- The oil price jumped up 0.5% to US$52.85 per barrel. This comes as a massive drawdown in US crude inventories countered persistent concerns about the pandemic continuing to hurt fuel demand.
- The gold price dropped to a 1-week low following concerns over the US stimulus bill and strength in the dollar after the Fed kept interest rates near zero.
Local trading Ideas:
- Bell Potter has a buy rating on Telecommunication Services company, Uniti Group (ASX:UWL) and has increased its price target by 10% to $2.20.
- Healthcare equipment and services company, Doctor Care Anywhere (ASX:DOC) is also a Bell Potter buy. DOC closed yesterday at $1.38 and Bell Potter’s price target for the stock sits at $1.95.
- People Infrastructure (ASX:PPE), Vita Group (ASX:VTG) and Platinum Asset Management (ASX:PTM) are all giving off bullish charting signals according to Trading Central.
The Aussie share market looks set to open in the red this morning, down about 0.32%. This comes following Wall Street’s struggle to find direction for three main reasons:
1) Key earnings, 2) the Federal Reserve’s policy meeting and 3) concerns about more US stimulus.
COVID-19 cases have topped more than 100 million cases worldwide in just about 13 months as mutations add to the spread.
What to watch today:
- NAB Business Confidence and Westpac leading index figures for December are both out at 11:30am.
- The oil price slid 0.3% to US$52.61 following COVID-19 cases continuing to rise globally, and amid reports of a blast in Saudi Arabia. Given this, keep an eye on energy producers like Beach Energy (ASX:BPT) and Santos (ASX:STO) today.
- The gold price softened on concerns over a fresh US COVID-19 aid package. The slightly weaker dollar limited losses. The gold price fell about 0.25% to US$1,850. So, keep an eye on Newcrest Mining (ASX:NCM) and Saracen Mineral (ASX:SAR).
Local trading ideas:
- Leading mining services company, Mineral Resources (ASX:MIN) has a buy rating by Bell Potter, with an increased price target of 57% to $44.40 (previously $28.50). This comes as the strength of the iron ore price currently shows no sign of abating.
- Gold producer, Gold Road Resources (ASX:GOR) also has a buy rating by Bell Potter, with an increased price target of about 3% to $2. Bell Potter believes the company is back on track with a better fourth quarter 2020 expected.
- Race Oncology (ASX:RAC), Azure Minerals (ASX:AZS) and GDI Property Group (ASX:GDI) are all giving off bullish charting signals according to Trading Central.
Positive sentiment stepped up a notch with the Aussie share market hitting a new 11-month high after rising 1.6% (Mon-Thu). And the good news isn't just local. With the electoral dust settling in the US, and China's economy continuing to grow, the Aussie market looks set to sprout new green shoots.
In this week’s wrap, Jessica covers:
- (1:40) The unemployment rate falling after 50K jobs were added
- (2:32) Afterpay (ASX:APT) becoming the 12th biggest company in Oz
- (3:03) Zip (ASX:Z1P) shares up 31%; its biggest rise in over 20-weeks
- (3:35) The battle for Buy Now Pay Later supremacy
- (5:20) New home sales hitting 20-year highs: which stocks could benefit?
The ASX200 is eyeing a fall of 0.3% at the open.
A day under US President Biden’s leadership and he’s kicked the focus to renewable energy, by re-joining the Paris Climate agreement and re-engaging with the World Health Organisation.
What to watch today:
- Energy stocks could see another pull back today after the oil price fell 0.5% with Biden planning to roll back oil and gas infrastructure projects.
- The Federal and South Australian Government announced SA will receive a $45 million handout to expand its recycling infrastructure.
- Keep an eye on travel stocks like Flight Centre (ASX:FLT) and Webjet (ASX:WEB) as Emirates will resume flights on Monday to Sydney, Melbourne and Brisbane.
- Preliminary retail sales data is out today and is expected to show sales cooled in December after November sales grew 7.1%, which was the biggest jump in sales in six months.
Local trading ideas:
- Cluey (ASX:CLU) was given a speculative buy rating by Bell Potter.
- Coronado Global Resources (ASX:CRN) was upgraded by Bell Potter with a new $1.55 target.
- BetMakers Technology (ASX:BET), Bellevue Gold (ASX:BGL) & Trek Metals (ASX:TKM) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.7% at the open.
Markets were bullish overnight as Joe Biden was sworn in as 46th President of the United States with a pledge to keep taxes low until after the pandemic. This could support the US economy and stocks.
What to watch today:
- The UAE signed a deal to buy 18 drones from the US. So keep an eye on Orbital Corporation (ASX:OEC), Drone Shield (ASX:DRO), Electro Optic Systems (ASX:EOS) and Xtech (ASX:XTE).
- Employment numbers for December are out at 11:30am. 50,000 jobs are expected to have been added last month and the unemployment is tipped to fall to 6.7%.
Local trading ideas:
- Accent (ASX:AX1) had its buy rating upgraded by Bell Potter with a new $2.65 target.
- Pantoro Limited (ASX:PNR) had its buy rating upgraded by Bell Potter with a new $0.28 target.
- Nickel Mines (ASX:NIC), Centuria Capital (ASX:CNI) and Beacon Lighting (ASX:BLX) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a 0.2% lift at the open following the 1.2% gain yesterday.
US equities lifted higher overnight, resuming trade after the Martin Luther King public holiday. This saw the S&P500 and NASDAQ gain 0.8% and 1.5% respectively.
What to watch today:
- Tech stocks are likely to follow the US moving higher. All eyes will be on Afterpay (ASX:APT) and Sezzle (ASX:SZL).
- Sydney Airport (ASX:SYD) will report December numbers.
- Australian Pharmaceuticals Industries (ASX:API) holds its AGM.
- Monthly consumer confidence data will be released with confidence levels at a decade high.
Local trading ideas:
- TechnologyOne (ASX:TNE) was upgraded to a buy by Bell Potter with a $9.25 price target.
- Liontown Resources (ASX:LTR) was upgraded to a speculative buy by Bell Potter with a $0.55 price target.
- Technology Metals (ASX:TMT), SG Fleet (ASX:SGF) and IDP Education (ASX:IEL) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a 0.6% lift at the open, which could erase some of yesterday’s 0.8% fall.
The UK continues its world leading vaccine rollout, extending vaccinations to those over 70.
All eyes are on commodity stocks as China’s economy rose more than expected in the fourth quarter, up 6.5%, taking yearly growth to 2.3%. This makes China the only country to grow last year.
Local trading ideas:
- Super Retail Group (ASX:SUL) was upgraded by UBS yesterday to a buy with a new $12.60 target.
- Mesoblast (ASX:MSB) was maintained as a Bell Potter speculative buy with a $5.10 target, implying 107% upside in a year from yesterday’s close.
- Chalice Mining (ASX:CHN), McMillan Shakespeare (ASX:MMS) and Catapult (ASX:CAT) are giving off bullish charting signals according to Trading Central.
The ASX200 is eyeing a 0.2% fall at the open to start the week.
US Presidential Elect Joe Biden is inaugurated in two days. Historically, Aussie equities have rallied in the year under a new presidency, with returns generally higher under democratic presidents.
What to watch today and this week:
- All eyes will be on oil stocks, which are likely to pull back as the oil price fell 2% when China reported the highest number of daily COVID-19 cases.
- Employment data is out this Thursday and is expected to show 50,000 jobs were added to the economy in December. Keep an eye on banking and finance stocks which should rally if the number is better than expected.
- The US market is closed on Monday for the Martin Luther King Holiday.
Local trading ideas:
- Aroa Biosurgery (ASX:ARX) was reiterated as a speculative buy by Bell Potter with a $2.00 price target, suggesting 89% upside in a year from Friday’s close.
- UBS reiterated Whitehaven Coal (ASX:WHC) as a buy with a $2.15 target.
- Weebit Nano (ASX:WBT), BetMakers Technology (ASX:BET) and Fortescue Metals (ASX:FMG) are giving off strong bullish charting signals according to Trading Central.
The Aussie share market has gained 2.2% so far this year and US shares are on a similar track, buoyed by an extra $US1.9T in economic stimulus. Plus, global economic growth looks positive once again...
In this week’s wrap, Jessica covers:
- (0:34) Why oil is likely to push higher
- (0:50) Standout stock: Whitehaven Coal (ASX:WHC) rising 14%
- (2:18) The direction of the Aussie share market
- (2:57) How you could benefit from increased commodity prices
- (4:11) Three tips when hunting for lithium stocks
- (5:34) What to watch next week
The ASX200 is eyeing a fall of 0.1% at the open.
Joe Biden unveiled his stimulus plan of US$1.9 trillion and the US senate will vote on impeaching Trump.
Johnson & Johnson’s one-dose COVID-19 vaccine trial showed a promising immune response.
What to watch today:
- Home and investment loans numbers are out with home loans expected to rise about 0.5% in November.
- Following building permit numbers being released yesterday with building approvals rising 2.6% in November, Morgan Stanley upgraded brick maker Boral (ASX:BRL) to a buy with a $5.80 target.
Local trading ideas:
- Macquarie reiterated Bluescope Steel (ASX:BSL) as a buy with a $21.20 target, expecting strong uplifts in forecasts as the steel market remains strong.
- Apiam Animal Health (ASX:AHX), Class (ASX:CL1) and Ava Risk Group (ASX:AVA) are all giving off strong bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.1% at the open following Wall Street closing mostly higher ahead of the US House impeaching President Donald Trump for a second time.
What to watch today:
- Building permit numbers are out today with building approvals tipped to have risen 2.6% in November, following the 3.8% lift in October supported by the record low interest rate.
- Rio Tinto (ASX:RIO) inked a new electricity contract with NZ power supplier Meridian Energy (ASX:MEZ) to keep Rio’s aluminium smelter operating until the end of 2024.
- Abacus Property Group (ASX:ABP) goes ex-dividend.
Local trading ideas:
- Morgan Stanley upgraded footwear business Accent Group (ASX:AX1), increasing its price target to $2.60, noting sales momentum should continue but will likely normalise by FY22.
- Audinate (ASX:AD8) was reiterated as a UBS buy with an $8 price target.
- Beach Energy (ASX:BPT), Uniti Group (ASX:UWL) and BetMakers Technology Group (ASX:BET) are giving off strong bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.1% at the open. The expected pull back comes as Aussie scientists are calling for the AstraZeneca vaccine rollout to be paused given it’s only 62% effective. The Aussie Government pre-bought 54 million doses of the AstraZeneca vaccine, however Scientists say they prefer the Pfizer and Moderna vaccines as they are 95% effective.
Broad market sentiment remains high with the economy expected to recover this year, as a vaccine is said to be available in Australia as early as February.
What to watch today:
- Oil gained 1.7% overnight rising to a new 11-month high of US$53.17.
- Lithium stocks as the lithium price is clawing out of a 2-year bear market.
Local trading ideas:
- Citi increased Afterpay’s (ASX:APT) price target to $115 but maintained the stock as a hold, noting app downloads somewhat slowed in December.
- UBS reiterated CSL (ASX:CSL) as a buy with a $346 target. 21 blood-plasma collection centres have opened since July last year and UBS thinks CSL is on track to reach its FY21 target opening 20-30 centres as vaccine rollouts continue.
- Super Retail Group (ASX:SUL) was upgraded to a buy from a hold by UBS.
- ARB Corp (ASX:ARB), Race Oncology (ASX:RAC) and Think Childcare (ASX:TNK) are giving off strong bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.1% at the open as US stocks pulled back from their record highs.
The Democrats are attempting to impeach US President Donald Trump, while Joe Biden is set to be inaugurated next week.
All eyes on commodities:
- As the oil price holds 11-month highs on Saudi’s output cut. Bell Potter’s favourites are Beach Energy (ASX:BPT), Cooper Energy (ASX:COE) and Whitehaven Coal (ASX:WHC).
- The iron ore price holds 9-year highs at US$168, but its price pulled back 0.3% overnight.
- The gold price rose 0.6% overnight.
- The copper price fell 3%, its sharpest fall since October 1 last year.
Local trading ideas:
- JP Morgan and Ord Monett upgraded Oil Search (ASX:OSH) to a buy from a hold.
- Citi upgraded Platinum Asset Management (ASX:PTM) from a sell to a hold.
- Citi downgraded Costa Group (ASX:CGC) from a buy to a hold.
- Telix Pharmaceuticals (ASX:TLX), IVE Group (ASX:IVE) and Bisalloy Steel (ASX:BIS) are all giving off strong bullish charting signals according to Trading Central.
The Aussie share market is suggesting a 0.1% gain at the open after the market rose 2.6% last week.
What to watch today:
- If Brisbane will end its 3-day lockdown at 6pm tonight or if it will be extended with a decision to be made this morning.
- Australian retail sales data, which is expected to show a 7% jump in spending in November.
All eyes will be on commodities:
- Iron ore stocks could rise as the iron ore price rose to US$169, a new 9-year high.
- Gold stocks could see some selling after money poured back into equities, pulling gold down $112 in a week to US$1,835.
Local trading ideas:
- Citi upgraded ARB (ASX:ARB) to a buy with a $34.25 price target.
- Bapcor (ASX:BAP) is rated as a buy by Citi following cars sales momentum.
- ASX (ASX:ASX) is a Citi sell with a $68 price target.
- Accent (ASX:AX1) was rated as a Citi buy as profit margins are expected to increase.
- Humm Group (ASX:HUM), Harvey Norman (ASX:HVN) and Sonic Healthcare (ASX:SHL) are all giving off strong bullish charting signals according to Trading Central.
The Aussie share market looks set to open 0.3% higher to 6,672. This comes as US equities rallied following Congress confirming the election of Joe Biden as president, as well as traders looking away from the Washington unrest.
Elon Musk has just become the richest person in the world, with a net worth of more than $185b. Telsa’s share price rocketed around 8% and in 2020 increased more than ninefold.
What to watch today:
- It’s worth keeping an eye on Aussie tech stocks, like Afterpay (ASX:APT), and Xero (ASX:XRO) given the Nasdaq reached the 13,000 mark for the first time in history.
- BHP (ASX:BHP) and Rio Tinto (ASX:RIO) both closed at record highs yesterday, up 6% and 8.5% respectively, given the rising iron ore price.
- The oil price continues to rise as supply constraints retain focus amid the US Capitol drama.
Local trading ideas:
- Virgin Money (ASX:VUK), BlueScope Steel (ASX:BSL) and Mastermyne Group (ASX:MYE) are giving off strong bullish charting signals according to Trading Central.
The Aussie share market is eyeing a lift at the open of around 1.5% to 6,642. This follows a strong night of trade over on Wall Street after the Democrats came close to taking control of the Senate. Both the Dow and the S&P500 hit record highs with the Dow rising more than 400 points, as investors flocked to financial and industrial stocks on bets that the Democratic sweep in Georgia would result in more stimulus for the economy.
However, the gains were held in check after armed protestors overran the Capital building during the Electoral College vote count. The breach stopped the formal congressional count of President elect Joe Biden’s presidential election victory over Trump.
What to watch today:
- Locally, both Balance of Trade and building approvals data for November will be released.
- The Aussie dollar broke through US78c for the first time since March 2018.
Local trading ideas:
- National Tyre & Wheel (ASX:NTD), Mineral Commodities (ASX:MRC) and EMvision Medical Devices (ASX:EMV) are giving off strong bullish charting signals according to Trading Central.
The Aussie share market is set to fall 0.1% at the open despite Wall Street’s rally overnight.
The polls are now open for the runoff Georgia elections which are important to incoming US President Joe Biden’s next couple of years in the White House.
What to watch today:
- Zip (ASX:Z1P) shares fell 5% yesterday following the release of its share purchase plan on Monday. There were reports overnight that Zip and AsiaPay formed a partnership however, no ASX announcement was released.
- The gold price rallied overnight rising to US$1,948 off the back of a continued weaker US dollar and focus turning to the Georgia runoffs. Gold miners like Newcrest Mining (ASX:NCM), Saracen Mineral (ASX:SAR), Northern Star Resources (ASX:NST) and St Barbara (ASX:SBM) could be on the rise again today.
- The oil price has broken above $50 for the first time since February 2020 jumping 5.1% to US$50.06 a barrel, following Saudi Arabia announcing voluntary cuts. Today looks set to be a great day for energy producers like Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
Local trading ideas:
- Harvey Norman (ASX:HVN), First Graphene (ASX:FGR) and Aurelia Metals (ASX:AMI) are giving off strong bullish charting signals according to Trading Central.
The Aussie share market is eyeing a fall of 0.5% at the open.
US stocks saw their worst year start sell off since 1983. The Aussie share market however gained 1.5% yesterday, marking the best start to the year in two decades. European equities closed higher for their first trading day of the year with the UK market up 1.7% as the second vaccine went into circulation.
In the US, construction spending data rose 0.9% in November, which was less than expected but still hit a record $1.5 trillion in the month.
All eyes are on Georgia which is preparing for Senate runoff elections on Tuesday. This could give Democrats a majority in the chamber.
Local trading ideas:
- Perenti Global (ASX:PRN), De Grey Mining (ASX:DEG) and Adairs (ASX:ADH) are giving off strong bullish charting signals according to Trading Central.
The ASX200 is eyeing a pull back of 1.2% at the open after ending 2020 1.5% lower.
The UK will start rolling out AstraZeneca’s vaccine today, meaning it will now have two vaccines in circulation while the country faces stricter lockdowns. In India, two vaccines have been approved for use.
People in Greater Sydney will be fined $200 if they’re caught not wearing a mask indoors as of today.
Gold rose 24% last year, the best yearly gain since 2010.
Empired (ASX:EPD), Vita Group (ASX:VTG), Pensana Metals (ASX:PM8), Engenco (ASX:EGN) and Hawthorn Resources (ASX:HAW) are showing bullish charting signals according to Trading Central.
It’s the last full day of trade for the year with the ASX200 expected to pull back 0.5% following US stocks closing lower. Overnight we saw US equities rise to brand new record highs before falling into the red. The US House voted to increase the second federal handout to $2,000. BUT. The extra payout was blocked in the Senate on concern the extra payout on top of the $600 already approved, will swell national debt.
Commodities:
· Oil price rose 0.5% after falling 1% in the previous session - so expect a rebound in some oil stocks.
· Iron ore is up 0.1% to US$155.57 – a new 7-year high.
· Gold inched up, as the US dollar fell. And that pushed the Aussie dollar to a two-year high - 76.8 US cents.
What to expect and watch today:
· You could expect some reshuffling today as the year closes tomorrow at 2pm.
· As the year wrap ups, traders will reflect on returns:
· The best performers this year have been the stay at home economy stocks, like Afterpay (ASX:APT) up 303%. APT rose to a record $122 yesterday.
· Stocks benefiting from China’s increased demand for Australian iron ore, and the lack of supply from Brazil, which boosted the iron ore price 68%, so Fortescue Metals (ASX:FMG) and Mineral Resources (ASX:MIN) are up 120% this year.
· The underdogs of 2020, like Flight Centre (ASX:FLT), Webjet (ASX:WEB) and Unibail-Rodamco-Westfield (URW)
Trading ideas:
· Harvey Norman (ASX:HVN), Centuria Capital (ASX:CNI) and Temple & Webster (ASX:TPW) are all showing bullish charting patterns according to Trading Central.
The Aussie share market is set to kick off its shortest and last trading week of the year on solid footing. The futures are suggesting a lift of 0.5% at the open.
It comes as European markets closed higher on Monday and US equities soared to brand new record highs – for two key reasons. Firstly, Trump unexpectedly signed the $900 billion COVID-19 relief bill into law, that includes paying most Americans $600. Secondly, the UK is expected to approve Oxford-Astra Zeneca’s COVID-19 vaccine this week.
Commodities
- Oil fell 1% to US$47.70 as supply looks to increase.
- Iron ore rose 0.2% to US$155 - a new high.
- Inversely, expect selling today in Gold stocks as the safe haven came under pressure again, down 0.3% to US$1,877 on US stimulus being rolled out.
What else to watch
- No economic news today. All eyes will be on local company news.
- Whether or not the US House vote on increasing the $600 payout to Americans to $2,000.
Trading ideas:
- UBS increased Fortescue Metals’ (ASX:FMG) buy rating and target price to $24.
- UBS also reiterated CSL (ASX:CSL) as a buy with a $346 target.
- Qantas (ASX:QAN) looks likely to rally once travel restrictions ease. QAN is buy stock for UBS and Morgan Stanley.
- Resimac Group (ASX:RMC), EMvision Medical Devices (ASX:EMV) and - People Infrastructure (ASX:PPE) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.7% at the open, with the market closing early today, closed for Christmas tomorrow and Monday.
European markets made gains overnight on hopes that a Brexit trade deal would be done and on the back of France opening its border to England on Wednesday.
In the US, Americans filing for unemployment benefits fell from a 3-week high. Pfizer and BioNTech inked a deal with the US Government to rollout an extra 100 million vaccines.
Local trading ideas:
- Citi called out EOS (ASX:EOS) and FINEOS (ASX:FCL) as buys with $7.75 and $4.60 price targets respectively.
- Asaleo Care (ASX:AHY) was downgraded to a hold from a buy by Citi after AHY received a takeover offer that it recommends shareholders do not take action on.
- Kathmandu Holdings (ASX:KMD), Money3 (ASX:MNY) and Harvest Technology Group (ASX:HTG) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.9% at the open, which should recover some of yesterday’s 1.1% loss.
US Congress leaders approved US$900 billion in COVID-19 aid which includes giving $600 to individuals.
Economic growth in the US grew 33.4% last quarter, erasing the prior 31.4% fall in April-June. The UK economy also grew in the third quarter, rising by a record 16%.
All eyes will be on the NSW Premier today with restrictions expected to remain until after Christmas.
Local trading ideas:
- Janison Education (ASX:JAN) was upgraded as a Bell Potter buy with a new $0.60 price target. This week JAN signed a 5-year $5m deal with Chartered Accountants to deliver an online education program.
- Youfoodz Holdings (ASX:YFZ) was called out as a Bell Potter buy for the first time with a $1.50 target, implying 57% growth in a year from yesterday’s close
- LaserBond (ASX:LBL), Kingsrose Mining (ASX:KRM) and Elders (ASX:ELD) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.4% at the open as investors weigh up that the NSW restrictions could shave 0.1% off this quarter’s economic growth according to Citi analysts.
Pfizer’s vaccine has been approved for use in the EU, while half a million people have already received the first dose of the vaccine in the UK. There are concerns that a new COVID-19 strain is in the UK and is spreading much faster, which has triggered more severe lockdowns and travel restrictions across Europe. Health authorities do say there is no evidence of a higher death rate in the new mutated strain.
In the US, Moderna is shipping its first batch of its vaccine.
US lawmakers agreed on a US$900 billion rescue package including direct payments of $600 to most adults and $600 per child.
What to watch today:
- Preliminary retail trade data is out today and is expected to show we spent 0.6% less in November. This comes after we splurged in October when retail trade rose 1.4%.
- Orica (ASX:ORI) holds its AGM today.
Local trading ideas:
- City Chic Collective (ASX:CCX) has announced the purchase of another distressed business. CCX will be entering the $9 billion UK market, after it inked a deal to buy 90-year Evans eCommerce and wholesale businesses. City Chic Collective is a Bell Potter buy and was given a new $4.10 target, which implies 16% upside in a year.
- Bell Potter upgraded Aeris Resources’ (ASX:AIS) price target to $0.12 and maintained its buy rating. Aeris Resources received higher than expected copper grades from its recent drilling in NSW and its shares charged over 5% yesterday.
- Bell Potter reiterated Nickel Mines (ASX:NIC) as a buy with a $1.49 target. NIC is also backed by Credit Suisse, Macquarie and Citi as a buy. Western Areas (ASX:WSA) is also a favoured nickel producer for Macquarie, Credit Suisse, and Citi.
- NRW Holdings (ASX:NWH), Jupiter Mines (ASX:JMS) and Praemium (ASX:PPS) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.2% at the open following last week’s 0.5% gain.
With economic growth data in the spotlight in the US, UK and in Australia, we will learn how we splurged on retail sales in November.
Today all eyes will be on the increased restrictions in NSW, with some thinking restrictions will tighten again before Christmas. Investors will also be weighing up that a US stimulus deal has not yet been agreed upon and that the US could soon have another vaccine in circulation, as the FDA approved Moderna’s vaccine as being ‘safe and effective’.
What to watch today:
- Potential selling in travel and tourism stocks. All eyes will be on Webjet (ASX:WEB), Qantas (ASX:QAN) and Sydney Airport (ASX:SYD).
- As people spend more time at home and stock up for Christmas, keep an eye on Woolworths (ASX:WOW) and Coles (ASX:COL).
- All eyes will be on healthcare stocks as COVID-19 resurges in NSW like Blackmores (ASX:BKL), Fisher & Paykel (ASX:FPH) and Ansell (ASX:ANN).
Local trading ideas:
- Respiratory mask company CleanSpace (ASX:CSX) is a Bell Potter buy and was given a new $7.65 target. That implies 18% upside in a year as CleanSpace upgraded its earnings guidance for the second time this year.
- UBS called Mineral Resources (ASX:MIN) a buy for the first time, giving the mining services business a $41.90 price target.
- Citi increased Bapcor’s (ASX:BAP) price target to $8.85 and reiterated its buy rating.
- Tabcorp (ASX:TAH), Vita Life Sciences (ASX:VLS) and Elders (ASX:ELD) are all showing bullish charting signals according to Trading Central.
The market has gained 1% this year... not a bad result considering it experienced its quickest fall into a bear market in history. With the recovery now in full swing, and earnings upgrades coming through, there's plenty riding on a strong 2021 for the economy and share market.
In this week’s wrap, Jessica covers:
- (0:17) A resilient Aussie share market
- (0:42) How the Tech sector blew the market out of the water
- (1:37) Three key trends among 2020's standout stocks
- (3:29) How to approach buying oil stocks
- (3:58) Where the market could go from here
- (5:47) Bell Potter's top 14 stocks to watch
The ASX200 is eyeing a flat open.
U.S. investors looked past weaker than expected economic news overnight with unemployment claims rising more than expected, and instead focused on a potential rescue package being agreed on before the end of the year.
Congressional leaders have said they’re close to agreeing on a $900 billion stimulus deal that includes direct payments to individuals.
Copper rose 1.2% to its highest level since February 2013. What’s key is that iron ore, nickel and copper are likely to move higher given rising Chinese demand and fiscal stimulus in China.
What to watch today:
- Sydney Airport (ASX:SYD) reports traffic numbers. Auckland International Airport (ASX:AIA) reported domestic travel in NZ is now at 90% of pre-COVID-19 levels.
- NAB (ASX:NAB), Incitec Pivot (ASX:IPL) and Nufarm (ASX:NUF) hold their AGMs today.
Local trading ideas:
- Bapcor (ASX:BAP) was upgraded by Citi following its market update yesterday. BAP was maintained as a buy with an increased target of $8.85. Citi expects FY21 profits to be $115 million, which would be 4.5% growth from last year.
- Doctor Care Anywhere (ASX:DOC) was initiated as a Bell Potter buy with a $1.95 price target.
- Codan (ASX:CDA), Nick Scali (ASX:NCK) and Netwealth (ASX:NWL) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.5% at the open.
U.S. stocks rose to new record highs overnight after the U.S. central bank upgraded its outlook for the American economy next year. The Federal Reserve now expects growth of 4.2% next year and for the unemployment rate to drop to 5%. The Fed also committed to buying $120 billion in bonds each month until full employment is reached.
What to watch today:
- Elders (ASX:ELD) holds its AGM today.
- The mid-year economic and fiscal outlook is set to be released today.
Local trading ideas:
- Pacific Smiles (ASX:PSQ) was reiterated as a Bell Potter hold with a $2.65 price target, while Morgan Stanley upgraded PSQ to a buy with a $3.00 price target.
- Perseus Mining (ASX:PRU), Centuria Capital (ASX:CNI) and MoneyMe (ASX:MME) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.7% at the open following Wall Street’s lead overnight.
The FDA announced Moderna’s COVID-19 vaccine met expectations for emergency use, which is a crucial step before full approval. If the FDA approves the vaccine, it will be the second vaccine approved for use in the U.S..
What to watch today:
- Afterpay (ASX:APT) and Xero (ASX:XRO) could likely see an increase in buying from December 21 as they will be added to the ASX50.
- Kogan.com (ASX:KGN) will be added to the ASX200 on December 21.
- Auckland International Airport (ASX:AIA) is set to report traffic numbers today.
- ANZ (ASX:ANZ) holds its AGM today.
Local trading ideas:
- ANZ (ASX:ANZ) was reiterated as a Citi buy with a $23.75 price target.
- Downer EDI (ASX:DOW) was reiterated as a UBS buy with a $6.30 price target. Downer is selling its WA Open Cut Mining business for $205m.
- RTG Mining (ASX:RTG), Colins Foods (ASX:CKF) and Netwealth (ASX:NWL) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.2% at the open following Wall Street’s fall overnight.
Tougher social distancing measures have been introduced in some parts of the U.S. with New York on the verge of a ‘full shutdown’.
Oil rose to a 9-month high to US$47, while Iron, Copper and Gold all fell overnight.
What to watch today:
- Chinese state media confirmed Beijing has blocked Australian coal imports, so keep an eye on coal mining companies like Whitehaven Coal (ASX:WHC), Stanmore Coal (ASX:SMR) and TerraCom (ASX:TER).
Local trading ideas:
- Access Innovation (ASX:AIM) was upgraded as a Bell Potter buy with a new $1.35 price target, implying 33% upside in a year from yesterday’s close.
- GR Engineering (ASX:GNG) was initiated as a Bell Potter buy with a $1.30 price target, implying 18% upside in a year from yesterday’s close. GR Engineering is leveraged to increase mining activity and Bell Potter forecasts it could make $299m in revenue, which would be a record result.
- BCI Minerals (ASX:BCI) was upgraded as a Bell Potter buy with a new $0.43 price target, implying 54% upside in a year from yesterday’s close. The Commonwealth Government’s Infrastructure Facility (NAIF) Board provided a $450m 15-year loan facility for its Salt & Potash Project in the Pilbara. What’s interesting is the existing salt solar evaporation projects owned by Rio Tinto nearby have been operating successfully there for almost fifty years, producing high quality salt for chemical and other industries.
- Vita Group (ASX:VTG), Mastermyne Group (ASX:MYE) and Gascoyne Resources (ASX:GCY) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a flat open to start the week.
Restrictions are easing in South Australia and Queensland has opened its borders.
What to watch today:
- The market could see a rise for the seventh week, with consumer spending, local tourism, food and beverage stocks to see a jump in sales as we get closer to Christmas.
- All eyes on Flight Centre (ASX:FLT) as a court trial kicks off today. Flight Centre is being accused of underpaying a handful of workers for over 13 years. FLT is a Morgan Stanley, UBS and Bell Potter buy.
What to watch this week:
- The Mid-Year Economic and Fiscal Outlook (MYEFO) is set to be released later this week. It is expected to show a stronger bottom line than October’s budget thanks to the rally of the iron ore price, while spending is expected to drop due to the JobKeeper payments.
Local trading ideas:
- Austal (ASX:ASB) was reiterated as a Citi buy with a $4.30 price target. Given the U.S., Australia, the Philippines and governments may look to stimulate economies through ship building programs, ASB’s revenues could rise.
- Asaleo (ASX:AHY) was reiterated as a Citi buy after it received a takeover offer.
- McPherson’s (ASX:MCP), Ava Risk Group (ASX:AVA) and Audio Pixels Holdings (ASX:AKP) are all showing bullish charting signals according to Trading Central.
The bull market stepped up a notch this week and hit a ten-month high on Wednesday after rising for seven straight days. The U.S. and Canada approved the Pfizer/BioNTech COVID-19 vaccine for use, and it appears the world economic shocks of the pandemic could soon be left in the dust...
In this week’s wrap, Jessica covers:
- (0:23) The event on everyone's mind: the end of COVID-19
- (1:10) The three standout stocks this week
- (3:06) Themes to watch and consumer confidence
- (3:46) Why you should keep an eye on Sydney Airport (ASX:SYD)
- (5:07) The positive RBA changes to the Buy Now Pay Later market
The ASX200 is eyeing a fall of 0.5% at the open.
CSL and the University of Queensland have abandoned their COVID-19 vaccine trial, as the risk of failure was too high.
House Speaker Nancy Pelosi said bipartisan negotiations were leading to “great progress”, but both sides were still debating over a liability waiver for businesses, leading to no progress on new U.S. stimulus.
U.S. unemployment claims rose more than expected last week, with jobless claims jumping to 800,000, the highest level since October.
The Iron price jumped to US$151 per tonne after rising 3%, collectively gaining 63% this year.
What to watch today:
- Expect CSL (ASX:CSL) to see a pull back today and to fall under $300. Keep in mind the potential COVID-19 vaccine was not a revenue stream for the business as they are the biggest blood therapy business in the world, and number two in flu shots. Once restrictions ease, blood plasma collections are expected to pick up again, hence why UBS has a $346 price target for CSL and Credit Suisse targets $325.
- Pendal (ASX:PDL) and Westpac (ASX:WBC) will hold their AGMs today.
Local trading ideas:
- Baby Bunting (ASX:BBN) was reiterated as a Citi buy with a $5.48 price target.
- Beach Energy (ASX:BPT) was initiated as a Bell Potter buy with a $2.29 target, implying 24% upside in a year from yesterday’s close.
- NEXTDC (ASX:NXT), Breville (ASX:BRG) and Enero Group (ASX:EGG) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.4% at the open after rising for 7-straight days.
Pfizer and BioNTech’s vaccine continues to gain traction as Canada becomes the second country to approve the vaccine and will begin its rollout next week.
The iron ore price is up 60% the year after gaining 0.9% overnight.
Trading ideas:
- Tech-air traffic control company Adacel Technologies (ASX:ADA) was upgraded by Bell Potter, reiterating ADA as a buy with an increased $1.15 price target.
- Bell Potter upgraded JB Hi-Fi (ASX:JBH) from a sell to a hold with an increased $43.65 price target.
- Cann Group (ASX:CAN), RTG Mining (ASX:RTG) and Kogan.com (ASX:KGN) are all showing short-term bullish charting signals according to Trading Central.
The ASX200 is eyeing a gain of 0.5% at the open and is now 47% up from its COVID-19 low.
The UK began to rollout Pfizer’s COVID-19 vaccine and the U.S. is potentially days away from emergency use approval, with plans to roll out the vaccine this month.
What to watch today:
- Westpac’s Consumer confidence numbers are out today and are likely to be positive, given the ANZ survey found consumer confidence has recovered to where it was last year, rising 1.7% to a yearly high.
- Business confidence numbers released yesterday soared to their highest level in two years. Collectively, this means businesses and consumers are likely to continue to spend and borrow, which supports share price and earnings growth in retail, online shopping, banking and finance stocks.
Local trading ideas:
- G8 Education (ASX:GEM) was reiterated as a UBS Buy with an increased $1.52 price target.
- Citi downgraded Champion Iron (ASX:CIA) to a Sell after it gained over 280% since March.
- Citi called out its top mining stock picks as Rio Tinto (ASX:RIO), South32 (ASX:S32) and Alumina (ASX:AWC).
- Clean TeQ Holdings (ASX:CLQ), Althea (ASX:AGH) and Gascoyne Resources (ASX:GCY) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.2% at the open.
People in the UK will be the first to receive the Pfizer BioNTech COVID-19 vaccine today, as the roll-out kicks off in England.
The iron ore price continued its push up 2% to US$144, another new 7-year high as China continues to produce 90 million tonnes of steel a month.
What to watch today:
- With the iron ore rally, keep an eye on Champion Iron (ASX:CIA), Mount Gibson (ASX:MGX), Mineral Resources (ASX:MIN), Fortescue Metals (ASX:FMG), Rio Tinto (ASX:RIO) and BHP (ASX:BHP).
- Bank of Queensland (ASX:BOQ) holds its AGM today.
- NAB business confidence will be released today.
Local trading ideas:
- With the oil price pulling back, keep an eye on energy companies. Bell Potter’s picks are Byron Energy (ASX:BYE), Cooper Energy (ASX:COE) and Senex Energy (ASX:SXY).
- Overnight UBS reiterated Santos (ASX:STO) as a Buy with a $6.60 target.
- PainChek (ASX:PCK), Atomos (ASX:AMS) and Codan (ASX:CDA) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a gain of 0.6% at the open.
Victoria and South Australia will welcome international flights and passengers starting today and NSW will ease restrictions at hospitality venues.
What to watch this week:
- Metcash (ASX:MTS) reports results today.
- NAB business confidence, building permits for October and Consumer Confidence is out tomorrow.
Local trading ideas:
- Bell Potter upgraded PSC Insurance’s (ASX:PSI) Buy rating with an increased $3.40 price target.
- Bell Potter highlighted some stocks to watch including City Chic (ASX:CCX), Premier Investments (ASX:PMV), Domino’s Pizza (ASX:DMP) and Accent (ASX:AX1).
- Temple and Webster (ASX:TPW), NEXTDC (ASX:NXT) and Stanmore Coal (ASX:SMR) are all showing bullish charting signals according to Trading Central.
Restrictions are lifting and Australia's economy has blasted out of its first recession in 29 years. The Aussie share market gained 0.2% (Mon-Thu) and is on track to record its fifth straight week of gains.
In this week’s wrap, Jessica covers:
- (1:20) Sectors: Mining explodes with a 5% uptick
- (1:45) Why earnings are likely to rise for the iron ore majors
- (2:54) The huge recovery of COVID-19 affected sectors in November
- (3:54) How the Aussie economy's bounce back shattered expectations
- (5:03) 17 stocks likely to benefit from increased consumer spending
The ASX200 is eyeing a fall of 0.1% at the open after rising for three straight days.
Pfizer and BioNTech plan to rollout 1.3 billion vaccines in 2021 and will catch up on the 50 million dose shortfall from this year.
Weekly employment conditions improved in the U.S. despite COVID-19 cases continuing to rise.
What to watch today:
- Keep an eye on commodities. So far this week, Fortescue Metals (ASX:FMG) shares are up 11%, Rio Tinto (ASX:RIO) rose 10% to a decade high, BHP (ASX:BHP) gained 7% to a yearly-high. Morgan Stanley’s favourite copper stock is Oz Minerals (ASX:OZL) and Sandfire (ASX:SFR), which is backed by Morgan Stanley and Credit Suisse as a Buy.
- AP Eagers (ASX:APE) and Premier Investments (ASX:PMV) hold their AGMs today.
- Retail sales are due out for October and are tipped to rise 1.6%, so keep an eye on consumer spending stocks.
Local trading ideas:
- Qantas (ASX:QAN) was given an upgrade by UBS with a new target of $6.20. Domestic capacity will increase to almost 70% of COVID-19 levels by the end of the year and will be at 80% by the end of March next year.
- Macquarie (ASX:MQG) was upgraded by Bell Potter as a Buy with an increased $150 target, implying 8% upside in a year from yesterday’s close. Macquarie is buying U.S. based asset manager and then selling a part of that business for a profit. These transactions should see Macquarie’s profit lift 3% after FY24 according to Bell Potter.
- Harvest Technology (ASX:HTG), MyFiziq (ASX:MYQ) and Whisper (ASX:WSP) are all showing bullish charting signals according to Trading Central.
The Aussie market is on for its third day of gains, with the futures suggesting a lift of 0.3%. It comes as global equities closed mostly higher overnight, after the UK became the first country to approve the Pfizer/BioNTech COVID-19 vaccine for use, with plans for it to be rolled out as early as next week.
What to watch today:
· Home loan data is out, as well as import and export data for October.
· Yesterday we learnt that Australia’s economy officially snapped out of its first recession in 29 years, as expected. The economy grew 3.3% from July to September beating expectations of 2.6% growth. This is for the September quarter so does not factor in the government’s new budgetary support, and that Victoria was in lockdown. So next quarter should be another strong month for economic growth. You could consider companies that benefit from that; so stocks in banking, property, consumer spending, airlines, travel, and tourism.
Trading ideas:
· Citi upgraded Qube’s (ASX:QUB) Buy rating with an increased $3.50 price target (implying 20% upside).
· UBS upgraded its Buy rating on Worley (ASX:WOR), an energy and chemical company. UBS increased Worley’s price target to $14.43. Citi also upgraded Worley with a new $14.18 price target.
· Bell Potter reiterated its ‘must have’ champion stocks are likely to see superior earnings and share price growth over the coming years. They include Amcor (ASX:AMC), Transurban Group (ASX:TCL), Challenger (ASX:CGF), Goodman Group (ASX:GMG), Netwealth Group (ASX:NWL), Brambles (ASX:BXB), CSL (ASX:CSL) and Sonic Healthcare (ASX:SHL).
· Medusa Mining (ASX:MML), Baby Bunting (ASX:BBN) and Stanmore Coal (ASX:SMR) are all showing bullish charting signals according to Trading Central.
The Aussie share market looks set for another positive day with a lift of 0.6% on the cards according to the futures. U.S. stocks rallied to a record closing high, buoyed by lawmakers unveiling a $908 billion stimulus plan, which includes $200 billion in pay check protection for small businesses.
What to watch today:
- Yesterday the RBA announced the economic recovery is going better than expected, with the Aussie economy tipped to have recovered by the end of next year. The central bank forecasts GDP of 5% next year and 4% the year after in 2022.
- Today, we get a gauge as to how much the economy grew in the September quarter with growth of 2.6% expected. That means the economy will have recovered from its first recession in 29 years, as the last two quarters of growth were negative. So… if growth is higher, expect stocks in mining, airlines, travel, tourism, consumer spending to do well, if it’s weaker, expect a pull back.
Trading ideas:
- Bell Potter upgraded GrainCorp’s (ASX:GNC) Buy rating with an increased $5.05 price target (implying 14% upside in a year). GNC has had a bumper year and season, with its crop at an 11-year high and 75% above its 10-year average.
- UBS upgraded its Buy rating on SSR Mining (ASX:SSR). UBS increased SSR’s target to $33. A recent technical report showed that its mine in Turkey is large scale, low cos, and has a long-life of 20 years.
- Bell Potter reiterated its favourite COVID-19 recovery stocks are Aristocrat Leisure (ASX:ALL), ANZ Banking Group (ASX:ANZ), Macquarie Group (ASX:MQG), Flight Centre Travel Group (ASX:FLT) and Qantas Airways (ASX:QAN).
- Goodman Group (ASX:GMG), ReadyTech Holdings (ASX:RDY) and Nick Scali (ASX:NCK) are all showing bullish charting signals according to Trading Central.
The Aussie share market futures are suggesting a fall of 0.2% for the first day of December. Summer is in the air – the QLD border is now open to Victorian and Sydney residents and the world is closer to another vaccine as Moderna applies for emergency clearance of their vaccine.
Overnight U.S. stocks slipped but held onto spectacular gains. The Dow lost 0.9% however posted its best November since 1987 on promising vaccine development… boosting confidence of an economic recovery. The S&P500 fell 0.5% but rose 11% in November, and the Nasdaq closed flat overnight but gained 12% last month.
What to watch:
- Australian grain farmers are on track to produce the second largest grain crop on record, following years of drought. Keep an eye on agricultural stocks like Australian Agricultural Company (ASX:AAC), Elders (ASX:ELD) and Select Harvests (ASX:SHV).
- About 60 Australian coal carrying ship are still being held up at Chinese ports. So keep an eye on coal stocks.
- Reporting today:Colins Foods (ASX:CKF) and National Storage REIT (ASX:NSR).
Trading ideas:
- Bell Potter upgraded stem cell business Mesoblast’s (ASX:MSB) speculative Buy rating with a new $7.40 price target (implying 78% upside in a year).
- Bell Potter upgraded copper company, Aeris Resources (ASX:AIS) Buy rating with an increased price target of 11.2 cents, implying 56% upside.
- UBS increased its Buy rating on Select Harvests (ASX:SHV) with a new price target of $7.90. UBS says despite almond prices being lower now, there is upside in FY22.
- Lastly, from a charting perspective, keep an eye on Damstra Holdings (ASX:DTC), Nitro Software (ASX:NTO) and Elders (ASX:ELD) – all these stocks are showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.6% at the open following a strong week on Wall Street, amid decreasing political uncertainty and positive vaccine news.
What to watch today and this week:
- Zip (ASX: Z1P) holds its AGM today. Although the Buy Now Pay Later provider recently released a trading update, today’s AGM may provide investors with a snapshot of November’s performance, as well as an update on further international expansion plans.
- Tomorrow afternoon will see the final meeting of the RBA for 2020.
- On Wednesday, RBA Governor Lowe will give testimony to Parliament, the same day the third quarter GDP report is released.
- Federal Reserve chairman Jerome Powell is poised to give testimony to Congress twice this week and the OECD are set to publish new global forecasts.
Local trading ideas:
- Bell Potter reiterated mining company, Mader Group’s (ASX:MAD) Buy rating and increased its price target marginally to $1.26. This follows easing interstate border restrictions and new hiring initiatives that continue to ease pressure on growth barriers in the strong WA market.
- Bell Potter retains its Buy rating on QANTM IP (ASX:QIP) with an unchanged 12-month price target of $1.60. Bell Potter believes QIP’s earnings are underpinned by relatively resilient industry drivers, with COVID-19 to date having limited impact on filing volumes.
- Noxopharm (ASX:NOX) and Jupiter Mines (ASX:JMS) are both showing bullish charting signals according to Trading Central.
The Aussie share market has gained around 12% this month. The market is 7% off record high territory so this year's Santa rally looks promising.
In this week’s wrap, Jessica covers:
- (0:32) Sectors hit the most this year see increased buying
- (0:48) Unibail-Rodamco-Westfield (ASX:URW) down 55% YTD
- (1:07) Flight Centre (ASX:FLT): ready for take-off?
- (2:00) Whitehaven Coal (ASX:WHC): 100% share price growth in a year?
- (3:12) How the ASX sectors have changed since January
- (3:50) The biggest ASX stocks: movement in 2020
The ASX200 is eyeing a 0.2% fall at the open.
Wall Street was closed overnight as it’s thanksgiving in the U.S..
The European Central Bank (ECB) warned that European banks won’t see profits return to pre-COVID-19 levels until after 2022.
What to watch today:
- About 80 Australian coal carrying ships holding around $1.1 billion of coal are being held up at Chinese ports. So keep an eye on stocks like Whitehaven Coal (ASX:WHC), New Hope (ASX:NHC), Washington H Soul Patts (ASX:SOL) and Stanmore Coal (ASX:SMR).
- Australian Finance Group (ASX:AFG), Money3 Corporation (ASX:MNY) and Omni Bridgeway (ASX:OBL) hold their AGMs today.
Local trading ideas:
- Bell Potter upgraded one of Australia’s largest scaffolding companies, Acrow Formwork & Construction Services (ASX:ACF), to a Buy with a new $0.40 price target, implying 10% upside in a year.
- Tissue regeneration company Aroa Biosurgery (ASX:ARX) was reiterated as a Speculative Buy by Bell Potter with a $2.00 target, implying 59% upside in a year.
- UBS upgraded Galaxy Resources (ASX:GXY) on the improving lithium market.
- Syrah Resources (ASX:SYR) was upgraded by UBS to a Buy on the graphite market reaching a turning point.
- Oz Minerals (ASX:OZL), Arena REIT (ASX:ARF) and Saracen Mineral Holdings (ASX:SAR) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a fall of 0.1% at the open following a mixed close on Wall Street overnight.
The U.S. central bank released minutes from its meeting highlighting how it can provide more support for the U.S. economy throughout the pandemic.
Commodities continued their rally as three vaccines are around the corner.
What to watch today:
- Yesterday the market turned positive for 2020 and was up 0.2% for the year, meaning the ASX200 erased most of the COVID-19 losses. If the ASX200 gains 7%, it will be back in record all-time high territory.
- Ainsworth Game Technology (ASX:AGI), Hansen Technologies (ASX:HSN), WiseTech (ASX:WTC), HUB24 (ASX:HUB), Monash IVF (ASX:MVF), NRW Holdings (ASX:NWH) and Qube (ASX:QUB) hold their AGMs.
Local trading ideas:
- Bell Potter upgraded the Buy ratings and price targets for Pendal (ASX:PDL) with a new $8.90 target, Perpetual (ASX:PPT) with a new $45.40 target and Challenger (ASX:CGF) with a new $6.60 target.
- Overnight, Citi reiterated Harvey Norman (ASX:HVN) as a Buy with a $5.20 target, implying 14% upside in a year. Citi expects Black Friday and Christmas sales to be strong and forecasts sales growth of 15% from now to the Boxing Day period.
- CSR (ASX:CSR), Ava Risk Group (ASX:AVA) and Emeco Holdings (ASX:EHL) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.6% at the open.
Oil gained 4% rising over US$45 for the first time since the pandemic hit in March.
What to watch today:
- Fisher & Paykel Healthcare (ASX:FPH) reports results today.
- Fletcher Building (ASX:FBU), Harvey Norman (ASX:HVN), IOOF (ASX:IFL), Kathmandu (ASX:KMD), Pro Medicus (ASX:PME), Shopping Centres Australia (ASX:SCP) and Synlait Milk (ASX:SML) hold their AGMs today.
- Construction numbers for the quarter are likely to remain negative with the market expecting a drop of 2%.
Local trading ideas:
- Financial software provider Praemium (ASX:PPS), was upgraded as a Bell Potter Buy with an increased target of $0.90, implying 36% upside in a year.
- Online learning and exam platform, Janison Education (ASX:JAN), was upgraded by Bell Potter to a Buy from a hold with a $0.45 price target, implying 20% upside in a year. Bell Potter says the company is well placed to deliver strong growth over the next 6-12 months.
- Nick Scali (ASX:NCK), Liontown Resources (ASX:LTR) and Challenger (ASX:CGF) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a rise of 0.6% at the open. If it does rise at the open, it is likely to set another 9-month high.
AstraZeneca and Oxford University’s COVID-19 vaccines was deemed 70% effective. This 70% rose to 90% when patients received a half dose followed by a full dose of the vaccine. CSL began producing 30 million doses of the vaccine a few weeks ago.
President-elect Joe Biden earmarked former Federal Reserve Chair Janet Yellen as Treasury secretary. When she led the Fed from 2014 to 2018, rates were low and the S&P500 gained 60%.
What to watch today:
- Keep an eye on Energy stocks today: UBS has Buy ratings on Origin Energy (ASX:ORG), Santos (ASX:STO), Woodside (ASX:WPL) and Worley Parsons (ASX:WOR).
- National Storage REIT (ASX:NSR) and TechnologyOne (ASX:TNE) report results today.
- Brickworks (ASX:BKW), Bravura Solutions (ASX:BVS), Mesoblast (ASX:MSB), Nanosonics (ASX:NAN) and Ramsay Health Care (ASX:RHC) hold their AGMs today.
- RBA Deputy Governor will speak on monetary policy, he is expected to unveil how much bond buying the bank has been doing.
Local trading ideas:
- Emergency services construction company, Johns Lyng Group (ASX:JLG) was upgraded as a Bell Potter Buy with an increased target of $3.60, implying 15% upside in a year.
- Buy now pay later new entrant, Laybuy Group Holdings (ASX:LBY), was reiterated as a Bell Potter Buy with a $3.00 price target, implying 120% upside in a year. Bell Potter says LBY is a stock to watch as it continues to fly under the radar, despite increasing its merchant value by over 160% in a year, reducing its bad debts and increasing its transaction margin from -0.6% to 1.7%.
- Whisper (ASX:WSP), Enero Group (ASX:EGG) and Harris Technology (ASX:HT8) are all showing bullish charting signals according to Trading Central.
The ASX200 is set to gain 0.4% at the open.
The NSW and Victorian border is open after 138 days of being closed.
COVID-19 cases are continuing to rise in the U.S., up 24% last week. This saw JP Morgan downgrade the U.S. first quarter 2021 economic growth to be -1%.
In New York, BHP and Rio gained about 1% each so it’s likely to be a positive day for some locally listed commodity stocks.
What to watch today:
- Bubs Australia (ASX:BUB) holds its AGM today.
- Amcor (ASX:AMC) and Elders (ASX:ELD) go ex-dividend today.
- Economic news this week: Manufacturing data is out today, RBA Governor speaks tomorrow and construction numbers are out Wednesday. Around the globe this week, both U.S. and European banks will release their most recent meeting minutes.
Local trading ideas:
- AMA Group (ASX:AMA) was reiterated as a Bell Potter Buy with an increased target of $1.00, implying 33% upside in a year.
- Footwear business that owns Athlete’s foot, Accent Group (ASX:AX1), was upgraded by Bell Potter, increasing its Buy rating and target to $2.15, implying 13% upside in a year.
- Tesserent (ASX:TNT), Centuria Capital (ASX:CNI) and Sealink Travel Group (ASX:SLK) are all showing bullish charting signals according to Trading Central.
The Aussie share market gained 2.2% this week (Mon-Thu) rising to a 9-month high. With a vaccine on the horizon, and approximately 75% of Aussie jobs lost to COVID-19 recovered, it would seem we've reached the light at the end of the tunnel. However, there are murmurs of unemployment rising.
The ASX200 is eyeing a gain of 0.4% at the open, on track for its fifth straight day of gains.
U.S. COVID-19 cases are continuing to rise, up 26% from last week.
What to watch today:
· Sydney Airport (ASX:SYD) and Orica (ASX:ORI) report results today.
· Autosports (ASX:ASG), Accent (ASX:AX1), Centuria (ASX:CNI), Kogan (ASX:KGN), Lendlease (ASX:LLS), Platinum (ASX:PTM) and ResMed (ASX:RMD) hold their AGMs today.
· Preliminary retail sales will be released today and are expected to show a rise of 0.3%. If it’s higher than expected, you might expect consumer spending socks like JB Hi-Fi (ASX:JBH),
· Harvey Norman (ASX:HVN), Kogan (ASX:KGN) Breville (ASX:BRG), Lovisa (ASX:LOV), Kathmandu (ASX:KMN) and Super Retail Group (ASX:SUL) to do well.
Local trading ideas:
· Life360 (ASX:360) was reiterated as a Bell Potter Buy with a $7.70 target, implying 111% upside in a year. Google is now collaborating with Life360, which allows any Google assisted device like phones, smart speakers, Google watches or car devices to tap into the Life360’s technology.
· Aus Agricultural Co (ASX:AAC) was upgraded by Bell Potter, increasing its Buy rating and target to $1.40, implying 19% upside in a year. AAC reported stronger than expected earnings which surprised many analysts and its stock jumped 5.7% yesterday. Its cashflow increased and debt reduced.
· Redbubble (ASX:RBL), QuickFee (ASX:QFE) and Shriro Holdings (ASX:SHM) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a gain of 0.1% at the open.
Tesla will be welcomed to the S&P500 in December, its shares gained 8% on this news.
What to watch today:
· Following the rally on Wall Street, you might expect buying today in tech, travel, tourism, gambling and bank stocks.
· Aristocrat (ASX:ALL), ALS (ASX:ALQ) and United Malt Group (ASX:UMG) report results today.
· Seven Group Holdings (ASX:SVW) and Cromwell Property Group (ASX:CMW) hold their AGMs today.
· New home sales data and wage price growth is out today for October.
Local trading ideas:
· Afterpay (ASX:APT) had its Buy rating upgraded by Bell Potter with a new $140 price target, implying 38% upside in a year from yesterday's close of $95.93. Afterpay held its AGM yesterday noting November is on track for a record month, without giving any details of what that looked like.
· Adacel Technologies (ASX:ADA), which controls 21% of the world’s airspace traffic management through their technology, had its Buy rating and price target upgraded by Bell Potter to $1.05, implying 50% upside in a year from yesterday's close of $0.78.
· Suncorp (ASX:SUN), Element 25 (ASX:E25) and Jumbo Interactive (ASX:JIN) are all showing bullish charting signals according to Trading Central.
Trading on the ASX is expected to resume today after it shut about 30 minutes into trade yesterday. While the ASX200 closed 1.2% up, today it’s eyeing a flat open with a gain of 0.1%.
Overnight, Moderna announced its COVID-19 vaccine was more than 94% effective in a late stage trial treating 30,000 people, this is the most effective vaccine to date. Interestingly, the flu shot has a 40% effective average and Pfizer’s COVID-19 vaccine is 90% effective. Moderna and Pfizer are both requesting emergency FDA approval for their respective vaccines.
For commodities, copper rose to a 29-month high, up 1.5%.
What to watch today:
- Afterpay (ASX:APT), Abacus Property (ASX:ABP), REA Group (ASX:REA), Pointsbet (ASX:PBH) and Investec (ASX:IAP) hold their AGMs today.
- The RBA meeting minutes will be released today. While the minutes are not likely to move markets, the employment data and retail sales released later in the week will likely impact markets as they are all about the consumer and their habits in COVID-19.
Local trading ideas:
- Bell Potter upgraded beauty business BWX's (ASX:BWX) Buy rating, increasing its price target to $5.20. This implies 24% upside in a year from yesterday’s close of $4.20.
- Bell Potter upgraded agriculture business Elders' (ASX:ELD) to a Buy, increasing its target to $13.30, implying 13% upside in a year from yesterday close of $11.80.
- Accent (ASX:AX1), Mount Gibson Iron (ASX:MGX) and Healius (ASX:HLS) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a gain of 0.8% at the open following global equities charging higher on Friday. Last week the Aussie share market gained 3.5%, hitting an 8-month high.
What to watch today:
- CSL (ASX:CSL) announced it’s building a new vaccine manufacturing plant near Melbourne airport in Victoria, which will be the biggest vaccine facility in the southern hemisphere. The government will sign a $1 billion agreement with CSL to supply Australia with products until 2036 and the plant will be ready in 2026.
- Keep an eye on Hydrogen stocks like Hazer (ASX:HZR) and Woodside (ASX:WPL), given the government is pushing for hydrogen to play a major part in carbon-neutral transport, power generation and manufacturing.
- GrainCorp (ASX:GNC) and Elders (ASX:ELD) report results today.
- BWX (ASX:BWX) holds its AGM today.
- U.S. housing sales, retail sales and industrial production will be released this week, Australian unemployment numbers will be released Thursday and retail sales are out on Friday.
Local trading ideas:
- Bell Potter upgraded Lovisa’s (ASX:LOV) Buy rating, increasing its target to $13.50, implying 18% upside in a year from Friday’s close of $11.48.
- Bell Potter upgraded media and marketing group IVE (ASX:IGL) to a Buy, with a new $1.38 target, implying 44% upside in a year from Friday’s close of $0.96.
- Elders (ASX:ELD), BidEnergy (ASX:BID) and Fleetwood (ASX:FWD) are all showing bullish charting signals according to Trading Central.
With several COVID-19 vaccines around the corner, the Aussie share market rose 3.7% this week (Mon-Thu). Better than expected business and economic confidence also helped fuel the charge. And given all eyes are on an economic recovery, portfolio positioning ticked up a notch.In this week’s wrap, Jessica covers:
- (0:24) The three key drivers fuelling Aussie shares to 9-month highs
- (1:09) Sectors: Energy charging up 15% on the oil price rally
- (1:23) Unibail-Rodamco-Westfield (ASX:URW) rising 40%
- (2:22) Global trends: Key indices on the move
- (2:52) BetaShares vs. Morningstar - how these fund managers have changed their investments over the year
The ASX200 is set to fall 0.6% at the open following global markets taking a breather overnight.
The Fed Chair said the U.S. economic outlook remained uncertain, despite a potential COVID-19 vaccine. Also weighing on equities, COVID-19 cases continue to rise to a new record.
What to watch today:
- Amid the pull back and profit taking overnight, keep an eye on the sector rotations that have stood out this week.
- AGMs: NEXTDC (ASX:NXT), Orocobre (ASX:ORE) and Polynovo (ASX:PNV).
Local trading ideas:
- Bell Potter upgraded Emeco Holdings’ (ASX:EHL) Buy rating, increasing its target to $1.58, implying 68% upside in a year from yesterday’s close.
- Bell Potter reiterated GrainCorp (ASX:GNC) as a Buy, with a $4.85 price target, implying 23% upside in a year from yesterday’s close, with the crop outlook looking strong.
- Globe International (ASX:GLB), JB Hi-Fi (ASX:JBH) and Reece (ASX:REH) are all showing bullish charting signals according to Trading Central.
The ASX200 is eyeing a lift of 0.5% at the open, headed towards its 6th straight day of gains.
Better than expected consumer and business confidence news added fuel to local markets, with consumer confidence at its highest level in 7 years.
What to watch today:
- Keep an eye on tech names that have been sold down this week on the back of COVID-19 vaccine hopes. You could expect Afterpay (ASX:APT), Zip (ASX:Z1P), Temple & Webster (ASX:TPW), Appen (ASX:APX) and Altium (ASX:ALU) to rally, given what happened on Wall Street.
- Graincorp (ASX:GNC) and Xero (ASX:XRP) report results today.
- AGMs: Wesfarmers (ASX:WES), Woolworths (ASX:WOW), Nine Entertainment (ASX:NEC), Seven West Media (ASX:SWM) and Estia Health Care (ASX:EHE).
Local trading ideas:
- CleanSpace Holdings (ASX:CSX) was upgraded by Bell Potter from a Hold to a Buy with a $6.75 price target, implying 17% upside. It’s been sold down recently after Pfizer announced vaccine hopes. But Bell Potter remains optimistic about CleanSpace’s growth, as sales so far have been well ahead of its prospectus forecasts.
- Bell Potter upgraded Straker Translations’ (ASX:STG) speculative Buy rating, increasing its target to $2.10, implying 32% upside.
- Nearmap (ASX:NEA), Pointsbet Holdings (ASX:PBH), Appen (ASX:APX) and Barra Resources (ASX:BAR) are all showing bullish charting signals according to Trading Central.
The ASX200 is set to rise for the 5th day, eyeing a gain of 0.8% at the open.
With the announcement that Pfizer and BioNTech’s COVID-19 vaccine candidate is 90% effective, global markets have continued to push ahead, for the most part, on hopes of an economic recovery.
What to watch today:
- Keep airlines, travel stocks, engineering companies, property groups and banks on your radar. Companies to watch might include: Qantas (ASX:QAN), Corporate Travel Management (ASX:CTD), Flight Centre (ASX:FLT), Emeco (ASX:EHL), NRW Holdings (ASX:NWH), Suncorp (ASX:SUN), Auswide (ASX:ABA), Macquarie (ASX:MQG), Commonwealth Bank (ASX:CBA), ANZ (ASX:ANZ), Westpac (ASX:WBC), NAB (ASX:NAB), Ardent Leisure (ASX:ALG), Woodside (ASX:WPL) and Santos (ASX:STO).
- Coca-Cola (ASX:CCL) may be worth a look as the New York listed company rallied overnight.
- Company results out today: CBA (ASX:CBA), Eclipx Group (ASX:ECX), Ausnet Services (ASX:AST) and Recce Pharmaceuticals (ASX:RCE).
- AGMs today: Fortescue Metals (ASX:FMG), Bingo Industries (ASX:BIN) and Computershare (ASX:CPU).
- Consumer confidence data is out today. It is expected to show an improvement given rates were cut and the economy seems to be growing stronger than expected.
Local trading ideas:
- Bell Potter increased Flight Centre’s (ASX:FLT) Buy rating and target to $19.00, implying 21% upside as the travel industry looks brighter with a more effective vaccine potentially around the corner.
- Bell Potter reiterated Suncorp Group (ASX:SUN) as a Buy with a $10.20 price target, implying 12% upside.
- IDP Education (ASX:IEL), Dexus (ASX:DXS) and Spirit Technology (ASX:ST1) are all showing bullish charting signals according to Trading Central.
The local futures are suggesting the Aussie share market will lift 2.7% at the open.
Overnight, a vaccine developed by Pfizer and BioNTech is 90% effective in treating COVID-19. As a result, cyclical stocks saw huge gains, on hopes that a V-shape recovery may be on track. Airlines and banks soared, while stay at home stocks lagged.
Elsewhere, Oil soared 8.5% to US$40.40, while the safe-haven Gold lost a fair bit of investment, falling 4% to US$1,866.
What to watch today:
· Cyclicals like travel stocks Qantas (ASX:QAN), Corporate Travel Management (ASX:CTD) and Flight Centre (ASX:FLT) are likely to rally today. Along with banks like Macquarie (ASX:MQG), and the big four CBA, ANZ, WBC, NAB.
· Companies that are in trial phase of a vaccine locally, particularly CSL (ASX:CSL) which has kicked off production of 30 million doses of a vaccine.
· Mesoblast (ASX:MSB) might be worth a look as it’s in phase three trials for a COVID-19 vaccine and is working on treating a rare disease in children, graft versus host disease for bone marrow transplants.
· Those that will likely lag today, including gold stocks and tech giants.
· Companies reporting results: James Hardie (ASX:JHX) and Incitec Pivot (ASX:IPL).
· AGMs: Domain (ASX:DHG) & Ingenia (ASX:INA).
Trading ideas:
· Bell Potter increased Uniti Group (ASX:UWL) Buy rating and target to $1.80 (implying 30% upside) with the Telco set to buy smaller competitor Opticomm. UWL shares are up 19% in 7 days.
· UBS reiterated Tabcorp (ASX:TAH) as a Buy with a $4.70 target. From a technical perspective – Tabcorp’s shares look like they could move higher, the 50-day moving average price crossed the 200 day.
· Los Corros (ASX:LCL), Pointsbet Holdings (ASX:PBH) and Praemium (ASX:PPS) are all showing bullish charting signals according to Trading Central.
The Aussie share market is eyeing a lift of 0.2% at the open.
The Senate has been won by majority Republicans, and the House of Representatives won by majority Democrats. Kamala Harris will become the first female elected Vice President, and investors will be focused on the stimulus that Joe Biden U.S. President elect will bring in. Both are set to be sworn in on the 20th of January.
What to watch today:
- Victoria has recorded its 10th straight day of zero COVID-19 cases or deaths. Victoria also eased restrictions and if all goes to plan, restrictions will ease again in two weeks from November 22nd.
- CSL (ASX:CSL) will start making 30 million doses of a COVID-19 vaccine in Victoria today. It is the University of Oxford and AstraZeneca’s candidate that will go into production with first doses set to be released in the first half of next year, pending the outcome of clinical trials and regulatory approval.
- Brexit talks will dominate headlines overseas, so keep an eye on stocks that earn money in the UK like Link Market Services (ASX:LNK) and Virgin Money (ASX:VUK).
- Locally, building approval numbers are out today and NAB’s business confidence is out on Tuesday.
Local trading ideas:
- Bell Potter increased Macquarie Group’s (ASX:MQG) Buy rating and target to $148.00, implying 9% upside.
- Citi reiterated pallet maker Brambles (ASX:BXB) as a Buy with a $12.90 target, expecting further upside in earnings by the end of 2021.
- News Corp (ASX:NWS) has been reiterated as a UBS Buy with a $25 target, after the company reported stronger than expected results last Friday.
Global markets rallied this week as the U.S. election result edges closer. Following border re-openings, local equities rallied 3.6% (Mon-Thu), almost erasing last week's losses. Plus with record low interest rates and bond-buying, it seems bullish sentiment is in the air...
In this week’s wrap, Jessica covers:
- (0:37) Sectors: Real Estate gaining 8% supported by interest rate cuts
- (0:57) Stocks in the spotlight: Flight Centre (ASX:FLT) and Inghams (ASX:ING)
- (1:34) Opportunities in the Travel sector as borders re-open
- (2:47) What the RBA's rate cut and bond purchasing means
The Aussie share market is eyeing a lift of 0.7% at the open following Wall Street’s rally for the fourth day.
Overnight, U.S. equities bounded ahead on hopes that a Presidential winner would soon be called, with Biden likely to win as he’s gained 50.4% of the votes. It also looks like the Republican party may win the Senate and Democrats may win the House of Representatives, given the current numbers. This means taxes could possibly not be hiked and that the China trade war may not get any worse.
What to watch today:
- Macquarie (ASX:MQG), News Corp (ASX:NWS), REA Group (ASX:REA) and Amcor (ASX:AMC) report results today.
- Chorus (ASX:CNU), James Hardie Industries (ASX:JHX) and Spark New Zealand (ASX:SPK) hold their AGMs today.
Local trading ideas:
- Ingham's Group (ASX:ING), which is a Bell Potter Buy, had its price target increased to $4.25, implying 28% upside.
- UBS upgraded Treasury Wine Estates (ASX:TWE) from a Hold to a Buy with an slimmer $8.80 target. TWE shares have slipped about 40% in two months.
- With borders opening back up, Bell Potter increased Flight Centre’s (ASX:FLT) Buy rating and target to $16.50, implying 19% upside.
- Keep an eye on Qantas (ASX:QAN), which is a UBS Buy with a $5.25 target.
- Ingham’s (ASX:ING), Ramelius Resources (ASX:RMS) and Wiluna Mining (ASX:WMX) are all showing bullish charting signals according to Trading Central.
The Aussie share market is eyeing a lift of 0.3% at the open.
U.S. equities rallied for the third straight day, looking past the idea that the Presidential election result could be contested, while Trump’s campaign has taken legal action to halt the counting of the ballots in Michigan and Pennsylvania.
What to watch today:
- The NSW border opens to Victoria on November 23, this could support Qantas’ (ASX:QAN) recovery.
- The Australian Government has secured two more potential COVID-19 vaccines, with 40 million doses being developed by biotechnology company Novavax, and 10 million doses being produced by Pfizer and BioNTech. Both vaccines are in stage three trials.
- National Australia Bank (ASX:NAB), Goodman (ASX:GMG) and GWA Group (ASX:GWA) report results today.
- Amcor (ASX:AMC), Ansell (ASX:ANN), Coles (ASX:COL), Downer EDI (ASX:DOW) and Estia Health (ASX:EHE) hold their AGMs today.
- All eyes will be on Flight Centre Travel (ASX:FLT) as travel restriction ease and Treasury Wine Estates (ASX:TWE) on the back of China’s import ban.
Local trading ideas:
- Bell Potter increased Domino's Pizza (ASX:DMP) to a Buy with a price target of $99.30, implying 14% upside.
- Bell Potter upgraded Imdex (ASX:IMD) from a Hold to a Buy, and increased its price target to $1.45, implying 20% upside in a year.
- Keep an eye on Qantas (ASX:QAN) today. UBS has the stock as a Buy with a $5.25 target.
- Pact Group (ASX:PGH), Frontier Digital Ventures (ASX:FDV) and Red 5 (ASX:RED) are all showing bullish charting signals according to Trading Central.
The Aussie share market is eyeing a gain of 0.1% at the open.
U.S. equities rallied for the second straight day, continuing to claw back from last week’s retreat which was the worst weekly fall since March.
What to watch today:
- China has allegedly put a temporary ban on Australian coal, copper-ore, wheat, wool, lobster and sugar imports into China from Friday.
- Woolworths (ASX:WOW) announced quarterly group sales rose 12% to $17.9b, with food sales up 13% as customers consumed more at home.
- Pendal (ASX:PDL) half year results are out today.
- Domino’s Pizza Enterprises (ASX:DMP) and Cedar Woods Properties (ASX:CWP) hold their AGMs today.
Local trading ideas:
- UBS reiterated the owner of IGA, Metcash (ASX:MTS), as a Buy, with a $3.25 price target.
- Bell Potter reiterated Kazia Therapeutics (ASX:KZA) as a Speculative Buy with a $2.00 target, implying 153% upside in a year.
- Bell Potter upgraded Auswide Bank’s (ASX:ABA) Buy rating and price target to $5.70, implying 14% upside in a year.
- Breville (ASX:BRG), Chalice Gold Mines (ASX:CHN) and IGO (ASX:IGO) are all showing bullish charting signals according to Trading Central.
The Australian share market is set to have a sluggish lift of 0.1%. Just 1 day out from the U.S. election, investors bought the dip, pushing up key U.S. indices such as the S&P500, Dow Jones, and Nasdaq rising 1.2%, 1.6%, and 0.4% respectively.
In commodities, Oil gained 3.7% rising to US$37.12, while gold commenced US$1,896.
What to watch today:
- The RBA meets, with rates expected to be cut to 0.1%
- Additionally, the RBA is set to announce more bond buying, with at least $5 billion a month in order to get more money in the economy.
Local trading ideas:
- UBS increased CSR’s (ASX:CSR) buy rating and price target to $5.19
- ResMed (ASX:RMD) was yesterday upgraded by Credit Suisse, Macquarie, UBS, and Wilsons. Credit Suisse is the most bullish with a target of $31
- UBS reiterated Westpac (ASX:WBC) as a buy with a $20.50 price target, after the bank announced what some would call a multi-year turnaround report card.
- Lastly, Trading Central’s technical analysis suggests that Amaysim (AYS), Ansell (ANN) and Bellevue Gold (BGL) are all showing bullish signals
The Australian share market is eyeing a lift of 0.9% at the open. With one day left until the U.S. election, amid the uncertainty investors exercised caution, with the Dow Jones, S&P500 and Nasdaq losing 0.6%, 1.2% and 2.5% respectively.
Oil holds at a five-month low at US$35.79 on demand concerns with U.S. COVID-19 cases hitting an all time high, while Germany and France entered new lockdowns last week.
What to watch today:
- AMP (ASX:AMP) confirmed its take-over offer from Ares Management Corporation is for $1.85 per share. On Friday AMP closed at $1.53, so expect a rally today.
- Westpac (ASX:WBC) reported it full year results, reporting a cash earnings of $2.61b which was less than UBS’s forecast of $2.62b.
- Results are out today for CSR (ASX:CSR).
Local trading ideas:
- Bell Potter reiterated Medical Developments (ASX:MVP) as a Buy, but trimmed its price target to $7.50, implying 38% upside in the year. MVP has a new strategy for the green whistle in Europe and hired CSL’s former head of Seqirus as its CEO.
- Citi reiterated Incitec Pivot (ASX:IPL) as a Buy with a $2.40 price target, expecting fertilisers to drive earnings growth in FY21.
- Bell Potter reiterated Immutep (ASX:IMM) as a Speculative Buy with a 60 cent target, implying 131% upside in the year.
- Rio Tinto (ASX:RIO), Mortgage Choice (ASX:MOC) and PKS Holdings (ASX:PKS) are all showing bullish charting signals according to Trading Central.
The Aussie share market copped a 3.4% pullback (Mon-Thu) - its biggest weekly fall in six months. With the U.S. election around the corner, and new European COVID-19 lock downs in force, Australian investors have been flicking the risk-off button amid the uncertainty.
In this week’s wrap, Jessica covers:
- (0:22) Investors abandoning cyclicals for defensive sectors
- (1:10) Coca-Cola Amatil (ASX:CCL) fizzing up 16%
- (1:53) Light at the end of the tunnel: the end of Australia's recession
- (2:18) Whether interest rates will be cut next week
- (3:29) Why the Aussie share market could rally after the U.S. election
- (4:37) Potential merger and acquisition stocks to watch, with BUY ratings: Nufarm (ASX:NUF), Southern Cross Media (ASX:SXL) & Computershare (ASX:CPU)
The Aussie share market is eyeing a gain of 0.6% at the open, a welcome lift from the 3.4% fall Monday to Thursday this week.
U.S. economic growth rebounded in the third quarter up 33.1%, beating expectations and almost in a V shape recovery formation. That rebound in growth erased the 31.4% plunge in GDP in the second quarter.
What to watch today:
- AMP (ASX:AMP) confirmed it has received a takeover offer from Ares Management. The takeover offer amount was not disclosed, but you’d think AMP shares will rally on the hype.
- Northern Star Resources (ASX:NST), ResMed (ASX:RMD) and National Storage REIT (ASX:NSR) report quarterly results today.
- Carsales.Com (ASX:CAR), Austal (ASX:ASB), EML Payments (ASX:EML), GWA Group (ASX:GWA), Integral Diagnostics (ASX:IDX), Recce Pharmaceuticals (ASX:RCE) and Southern Cross Media Group (ASX:SXL) hold their AGMs today.
Local trading ideas:
- Bell Potter reiterated The a2 Milk Company (ASX:A2M) as a sell with a $12.70 target, implying it will fall 11% in a year.
- Citi reiterated ship builder Austal (ASX:ASB) as a buy, but trimmed its target price to $4.30.
- UBS reiterated Newcrest Mining (ASX:NCM) as a buy, but trimmed its price target by 50 cents, to $38.00 with UBS saying although NCM’s costs are higher, its gold mine in WA is still growing nicely.
- Matador Mining (ASX:MZZ), PRO-PAC Ltd (ASX:PPG) and Catapult Group International (ASX:CAT) are all showing bullish charting signals according to Trading Central.
The futures are suggesting that the ASX200 is eyeing a fall of 1.7% or 103 points at the open. There’s five days until the U.S. election, and as its history goes, the risk-off environment continues. The Dow sank over 900 points, or 3.4%, its biggest retreat since June. The tech-heavy Nasdaq fell 3.7%, but it’s still up 21% this year.
Commodities mirrored equities; Oil fell 5% to US$37.34, and Gold lost 1.8% to US$1,877.
What to watch today:
· Quarterly results are out today for: ANZ (ASX:ANZ), Fortescue Metals Group (ASX:FMG), Newcrest Mining (ASX:NCM), Orocobre (ASX:ORE), Janus Henderson (ASX:JHG) and IOOF Holdings (ASX:IFL).
· ANZ’s results showed their statutory profit fell 40% to $3.58 profit.
· AGMs: Australian Ethical (ASX:AEF), Challenger (ASX:CGF), JB Hi-Fi (ASX:JBH), Jumbo Interactive (ASX:JIN), Pinnacle Investment Management (ASX:PNI), Reece (ASX:REH), Reliance Worldwide Corporation (ASX:RWC).
Trading ideas:
· Bell Potter upgraded Life360’s (ASX:360) Buy rating, increasing its price target to $7.70 implying 92.5% upside in a year.
· Afterpay (ASX:APT) was also upgraded by Bell Potter, increasing its Buy rating and price target to $137. That implies 33% upside in a year. Morgan Stanley targets $121.
· UBS upgraded Qantas Airways’ (ASX:QAN) Buy rating, increasing its price target to $5.25 with the focus on Australian travel growth.
· Champion Iron Ltd (ASX:CIA), Vulcan Energy Resources (ASX:VUL) and ResMed (ASX:RMD) are all showing bullish charting signals according to Trading Central
The local futures are suggesting the market will fall 0.4% at the open, which will mark the fifth straight day of falls. But keep in mind, every year after a U.S. presidential election, over the last 36 years, the Aussie market has rallied and had a positive year.
Commodity traders breathed a sigh of relief. Oil rallied up 2% to US$38.97 and Gold edged up 0.2% to US$1,908.
What to watch today:
· Afterpay (ASX:APT) announced underlying sales sky rocketed 115% to $4.1b in the September quarter, up from $1.9b the same time last year. Morgan Stanley recently upgraded APT’s buy rating and price target to $121.
· Quarterly results: Coles (ASX:COL) and Galaxy (ASX:GXY).
· AGMs: Medical Developments International (ASX:MVP), Netwealth Group (ASX:NWL), Steadfast Group (ASX:SDF), Super Retail Group (ASX:SUL), Tassal Group (ASX:TGR), Vocus Group (AS:VOC) & Codan (ASX:CDA).
Trading ideas:
· Bell Potter upgraded heavy equipment maintenance company, Mader Group’s (ASX:MAD) Buy rating, increasing its price target to $1.25 implying 37.4% upside in a year, on the back of borders opening up in Australia.
· Bell Potter increased ANZ’s (ASX:ANZ) Buy rating, increasing its target to $21.20 implying 9% upside in a year.
· Citi reiterated Nick Scali (ASX:NCK) as a Buy, increasing its price target to $10.50, expecting 20% share price return and 6.6% dividend yield.
· West African Resources (ASX:WAF), Kina Securities (ASX:KSL) and Harvest Technology Group (ASX:HTG) are all showing bullish charting signals - according to Trading Central
The local futures are pricing in that the market could fall 0.9% at the open. Overnight on markets, the undertone was mostly negative, with COVID-19 cases spiking in the U.S., China and Europe. The Dow fell 2.3%, marking its worst fall in 8-weeks. the S&P 500 shed 1.9% and the Nasdaq fell 1.6%.
Commodities were weaker. Oil fell over 3% to US$38.55 with Libyan output rising. Gold steadied at US$1,904, as investors topped up their bond exposure instead.What to watch today:
· Boral (ASX:BLD) agrees to sell its 50% stake in USG Boral for A$1.43 billion
· Northern Star (ASX:NST) announced first quarter gold sales are at the top end of guidance.
· Evolution Mining (ASX:EVN) announced quarter results. Pointsbet Holdings (ASX:PBH) is due to hand down theirs today.
· AGMs: Bendigo and Adelaide Bank (ASX:BEN), Nick Scali (ASX:NCK), Bega Cheese (ASX:BGA), Boral (ASX:BLD) & Link Market Services (ASX:LNK).
Trading ideas:
· Bell Potter upgraded Technology One’s (ASX:TNE) Buy rating, increasing its price target to $10, implying 14.4% upside in a year.
· Bell Potter downgraded Stanmore Coal (ASX:SMR) as a Sell, dropping its price target to $0.50, implying a fall 31% in a year.
· UBS reiterated Flexigroup (ASX:FXL) as a Buy with a $1.45 price target.
· UBS reiterated Westpac (ASX:WBC) as a Buy with a $20.50 price target. Bell Potter targets WBC as a hold with a $20 target.
Perenti Global (ASX:PRN), Arena REIT (ASX:ARF), and IDP Education (ASX:IEL) are all showing bullish charting signals - according to Trading Central.
The Aussie share market is eyeing a gain of 0.3% following Wall Street’s positive close on Friday.
The focus this week will be on economic data, with economic growth data out for the U.S. and Australia for the third quarter.
In Australia, quarterly results this week are out for TPG (ASX:TPG), ANZ (ASX:ANZ), Janus Henderson (ASX:JHG) and ResMed (ASX:RMD).
Local trading ideas:
- Bell Potter upgraded Mineral Resources (ASX:MIN) to a buy, increasing its price target to $28.50, implying 14% growth.
- Bell Potter upgraded Insurance Australia Group (ASX:IAG) to a buy with a $5.60 target, implying 14.3% upside.
- UBS reiterated Worley (ASX:WOR) as a buy with a $12.32 price target.
- NRW Holdings (ASX:NWH), Charter Hall Group (ASX:CHC) and JB Hi-Fi (ASX:JBH) are all showing bullish charting signals according to Trading Central.
In just one week the Aussie share market hit a seven-month high, whilst also hitting an eight-day low. It seems this pendulum of volatility is a reaction to the impending U.S. election in ten days. The technical viewpoint indicates there is upside to come.
In this week’s wrap, Jessica covers:
- (1:05) Investors rotating out of defensive sectors and into cyclicals
- (1:19) Pro Medicus (ASX:PME) jumping 14%, while Megaport (ASX:MP1) sinks 9%
- (2:07) The pre-election cash build up: what you need to know
- (3:02) What the markets tell us about the U.S. election
- (5:05) Three trading ideas in IT, Education & Property
The ASX200 is eyeing a flat open today with all eyes and ears on the U.S. presidential debate kicking off at 11am AEDT.
The first COVID-19 treatment was approved by the U.S. FDA, giving Gilead Sciences’ drug, Remdesivir, formal approval to treat COVID-19.
What to watch today:
- Restaurants, cafes, pubs and clubs will be able to take group bookings of up to 30 people.
- Flash PMI numbers for October are out, they are a preview of what to expect ahead of official numbers.
Trading ideas:
- Citi reiterated Aristocrat Leisure (ASX:ALL) as a buy with a $34.60 price target.
- Bell Potter upgraded Laybuy Group Holdings (ASX:LBY) as a speculative buy, increasing its price target to $3.00. This implies 76% upside on its rapid and record growth.
- Bell Potter upgraded Aeris Resources Ltd (ASX:AIS) as a buy, increasing its target to $0.109, implying 79% upside.
- Navigator Global Investments (ASX:NGI), MyFiziq (ASX:MYQ) and Tesoro Resources (ASX:TSO) are all showing bullish charting signals according to Trading Central.
The futures are suggesting the ASX200 will fall 1.1% following Wall Street’s close in the red and comes despite NSW restrictions being eased from tomorrow, with restaurants, cafes, pubs and clubs able to take group bookings of up to 30 people per group.
U.S. investors lost patience that a fresh U.S. stimulus package would eventuate before the election in almost 11 days. But it’s important to note, regardless of who wins the presidential race, more stimulus will come from either party to bring their economy back to life. Netflix reported less subscribers than expected, which saw its shares lose about 7%. Meanwhile, Snap shares soared 28% to an all-time high on a smashing quarterly report.
On the Commodity front: Oil fell 4% US$40.01 with Libya ramping up production, while U.S. inventory figures showed gas demand weakened. So that could hurt oil stocks today. While Gold made its first notable move in days, rising 1% to US$1,927.
What to watch today:
- Quarterly results from AMP (ASX:AMP), Qantas (ASX:QAN), Mirvac (ASX:MGR) and OZ Minerals (ASX:OZL).
- AGMs today: Suncorp (ASX:SUN), Webjet (ASX:WEB), Magellan (ASX:MFG) and Crown (ASX:CWN).
- RBA’s Deputy Governor, Guy Debelle will take part in a Fireside Chat – on the Future of the FX Global Code – at FX Week Australia 2020
Trading ideas:
- Bell Potter upgraded Praemium’s (ASX:PPS) Buy rating, increasing its price target to $0.85, implying 41% upside. Praemium’s quarterly results were much stronger than expected supported by its Powerwrap acquisition.
- Bell Potter also upgraded MyState’s (ASX:MYS) Buy rating, increasing its price target to $4.50 implying 15% upside on MYS’ net interest margin. Bell Potter expects cash and NPAT growth to continue in FY22 and beyond.
- UBS upgraded Megaport (ASX:MP1) from a neutral to a Buy with a new $16.45 price target. UBS sees more strength in the second half of this financial year, with growth from North American after its customers rose 63%.
- Red 5 (ASX:RED), Bigtincan Holdings (ASX:BTH) and Galaxy Resources (ASX:GXY) are all showing bullish charting signals - according to Trading Central.
The ASX futures are suggesting the market will lift 0.2% - with the focus on Daniel Andrews opening Victoria’s boarders. This comes after seven of Australia’s largest companies, including BHP, Wesfarmers, CBA and CSL called on the government to open the boarders, saying ‘the current situation is not sustainable’.
Hopes are high for a new U.S. fiscal rescue package to be reached, with House of Representatives Speaker Nancy Pelosi just hours away from handing a deal to the Trump Administration, to hopefully be passed before the election. The benchmark S&P500 ended 0.5% higher, the Dow lifted 0.4% and the Nasdaq rose 0.3%. As for commodities: Oil gained 1.7% to US$41.51 and Gold maintained its foothold around US$1,909.
What to watch today:
- More quarterly results are out today, including for: Lynas Corporation (ASX:LYC), Megaport (ASX:MP1), Sandfire Resources (ASX:SFR), Syrah Resources (ASX:SYR), Atlas Arteria Group (ASX:ALX), and Coronado Global Resources (ASX:CRN).
- AGMs today: AGL Energy (ASX:AGL), MyState (ASX:MYS), Orora (ASX:ORA), Service Stream (ASX:SSM) and Temple & Webster (ASX:TPW).
- Ex-dividends: Acrow Formwork & Construction Service (ASX:ACF), Australia & International Holdings Limited (ASX:AID) and Sandon Capital Investments (ASX:SNC).
- Preliminary retail data is out today. Not likely to move the needle though.
Trading ideas:
- Bell Potter upgraded costume jewellery business Lovisa (ASX:LOV) as a Buy, increasing its price target to $10.00 , implying 15% upside. LOV held its AGM yesterday, noting same store sales are almost back in the black, while Metro Melbourne stores are set to open on 1 November.
- Zip (ASX:Z1P) was reiterated as a UBS Sell, with a $5.50 price target, after Zip launched ‘Tap and Zip’ allowing people to shop anywhere that accepts Zip.
- Bell Potter downgraded Pacific Smiles (ASX:PSQ) from a Buy to a Hold, but increased its target to $2.05. However Morgan Stanley maintained Pacific Smiles as a Buy with a $2.40 target as the group is expecting fee growth of 20%.
- Uniti Group (ASX:UWL), Structural Monitoring Systems (ASX:SMN) and West African Resources (ASX:WAF) are all showing bullish charting signals - according to Trading Central.
The futures are suggesting the Aussie share market will pull back 0.7% after the ASX200 scaled to a new 7-month high yesterday, its highest level since the 6th of March 2020. But remember the market is in a technical break out point, trading above its 200 and 50 day moving average, indicating the market is likely to explore higher levels.
What to watch today:
- Reporting today: BHP’s (ASX:BHP) quarterly results with all eyes on China’s alleged Australian coal ban, and Sydney Airport (ASX:SYD) reports September traffic numbers.
- AGMs: Bapcor (ASX:BAP), Cochlear (ASX:COH), Lovisa (ASX:LOV), McMillan Shakespeare (ASX:MMS), Stockland (ASX:SGP) & Tabcorp (ASX:TAH) .
- RBA Assistant Governor of Financial Markets speaks about monetary policy today and the tools to stimulate the economy at 10am.
- RBA minutes will be released at 11:30am.
Trading ideas:
- South32 (ASX:S32) has been reiterated as a UBS Buy, with a $3.00 price target, after it handed down quarterly results yesterday, bumped up its outlook and reinstated its share buyback program.
- Bell Potter upgraded car repair and aftercare business AMA’s (ASX:AMA) Buy rating, increasing its price target to $0.95, implying 39% upside. Bell Potter says with Victoria’s lockdowns easing, AMA should be able to increase its earnings, forecasting higher earnings than AMA expects.
- Ansell (ASX:ANN) was maintained as a Citi Buy with a $41 target given demand for medical gloves from COVID-19 is tipped to remain high for some time.
- OZ Minerals (ASX:OZL), Orica (ASX:ORI) and Zoono Group (ASX:ZNO) are all showing bullish charting signals - according to Trading Central
The ASX200 is set to gain 0.6% at the open with Victoria’s restrictions beginning to ease from today.
There are 16 days until the U.S. election, but the focus for many remains on stimulus and economic news. Earnings are back in focus this week with IBM, Netflix and Tesla to report.
China’s GDP growth numbers are out today and Flash PMI numbers for Australia, the U.S., the UK and Europe are out later this week.
What to watch today:
- South32 (ASX:S32) reports production results today.
- Companies going ex-div: Cadence Capital (ASX:CDM), Frontier Diamonds (ASX:FDX), Wam Global (ASX:WGB), WAM Leaders (ASX:WLE) and K&S Corp (ASX:KSC).
Local trading ideas:
- Citi downgraded Zip Co. (ASX:Z1P) to a sell with a reduced price target of $6.55. Citi sees downside risks from increased international competition.
- Woolworths (ASX:WOW) has been reiterated as a buy by UBS with a $43.50 price target. WOW quarterly results are due on the 4th of November, which could be the next catalyst for the business.
- Ahead of NAB (ASX:NAB) releasing its financial year results on the 5th of November, Bell Potter revised NAB’s buy rating with a new $21.00 price target, implying 9% upside.
- Weebit Nano (ASX:WBT), Navigator Global Investments (ASX:NGI) and Vista Group International (ASX:VGL) are all showing bullish charting signals according to Trading Central.
The Aussie share market kicked up 1.8% (Mon-Thu) following better than expected economic news and government stimulus. With uncertainty around the world, the risks appear manageable given the momentum behind economic growth.
In this week’s wrap, Jessica covers:
- (0:22) The Tech sector powering up 4% to a 20-year high
- (0:50) Afterpay (ASX:APT) hitting an all-time high & getting upgraded after AUSTRAC clearance
- (2:05) The ASX200 forming a Golden Cross bullish trend
- (3:39) The RBA dropping its dire 10% unemployment rate forecast
- (4:25) Momentum behind economic growth outpacing uncertainty
- (5:09) Four trading ideas across Health Care, IT & Industrials
The ASX200 is set to fall 0.2% at the open following some of the European Government reinstating COVID-19 restrictions. This saw London’s FTSE fall 1.7%.
As for Commodities, the oil price fell back to US$40.99 after rising 4% in the two prior sessions.
What to watch today:
- Rio Tinto (ASX:RIO) reports quarterly results today with all eyes on statements relating to coal as China allegedly suspended orders.
- SKYCITY Entertainment Group (ASX:SKC) holds its AGM today.
Local trading ideas:
- Radiology and software company, Pro Medicus (ASX:PME), was downgraded to a sell by Bell Potter following its 12% rally this week to $31.23 yesterday.
- Citi reiterated Alumina (ASX:AWC) as a buy with a $1.80 target given the improving global aluminium demand.
- Citi reiterated Newcrest Mining (ASX:NCM) as a buy but dropped its price target by $1 to $36.
- MoneyMe (ASX:MME), Redbubble (ASX:RBL) and Fortescue Metals (ASX:FMG) are all showing bullish charting signals according to Trading Central.
The futures are suggesting a pull-back of 0.2%, which will trim off some of this week’s gain of 1.3%.
U.S. equities pulled back for the second session overnight, as investors came to grips that an American COVID-19 stimulus deal wouldn’t be reached before the November 3 presidential election.
As for Commodities: The oil price lifted over 2% for the second day, nudging over US$41.11. Gold firmed 1% higher to US$1,905.
What to watch today:
- The future for coal exports to China: BHP (ASX:BHP) confirmed that Chinese customers have deferred orders of Australian coal.
- Reporting today: Alumina (ASX:AWC) and Whitehaven Coal (ASX:WHC).
- AGMs today: Audinate Group (ASX:AD8), ARB Corporation (ASX:ARB) and Perpetual (ASX:PPT).
- The unemployment rate is expected to rise from 6.8% to 7.1% with 35,000 jobs expected to be lost in September amid Victoria being the second most populated state in lockdown.
- Data from the Australian Banking Association tells us that repayments have resumed for about half of the deferred loans.
Trading ideas:
- Afterpay (ASX:APT) had its price target increased to $121.00 by Bell Potter. We have not heard from other brokers yet but are expecting more upgrades given APT passed the external monetary laundering AUSTRAC audit, with the body saying it would not investigate Afterpay further.
- UBS restamped Zip (ASX:Z1P) as a sell with a $5.50 target. We know Zip’s results yesterday at face value were strong, but Zip’s results were weaker than what the market was expecting given it’s taken over QuadPay.
- Following CSL’s (ASX:CSL) AGM yesterday, Citi maintained the blood therapy business as a Buy with a $325 target, with the market focused on FY21 and the strong demand for plasma and blood therapies.
- Adairs (ASX:ADH), Whisper (ASX:WSP) and MNF Group (ASX:MNF) are all showing bullish charting signals - according to Trading Central
After five days of straight gains, it looks like some profit taking is in order today. The futures are suggesting a fall of 0.9% today.
The reason sentiment is likely to be weak today is because global equities pulled back overnight with the UK recording its highest daily rise in COVID-19 deaths.
In the U.S., Johnson & Johnson’s COVID-19 vaccine study was paused due to an unexplained illness in a patient study, seeing J&J shares slide 2.3%.
What to watch today:
- The oil price gained 2% to US$40.17, while Gold fell about 2% to US$1,894.
- Afterpay (ASX:APT) received finalisations and clearance from AUSTRAC’s audit.
- Bank of Queensland (ASX:BOQ) reported its net profit fell 61%. Auckland International Airport (ASX:AIA) and Aurizon Holdings (ASX:AZJ) also report.
- AGMs today: CSL (ASX:CSL), Cleanaway Waste Management (ASX:CWY) and Aurizon Holdings (ASX:AZJ).
- Overnight, the International Monetary Fund (IMF) revised its global economic growth forecasts higher to a 4.4% contraction, up from negative 4.9% growth for 2020.
Trading ideas:
- Orica (ASX:ORI), a leading explosives manufacturer was reiterated as a Citi Buy with a new increased target of $19.50. Citi is expecting medium-term earnings growth underpinned by higher pricing, increased technology sales and better plant utilisation.
- Following Telstra’s (ASX:TLS) AGM yesterday UBS maintained Telstra as a Buy with $3.70 target.
- BCI Minerals (ASX:BCI), Silver Lake Resources (ASX:SLR) and Ramelius Resources (ASX:RMS) are all showing bullish charting signals - according to Trading Central.
Another positive day is on the cards for the Aussie share market, with the ASX200 set to lift 0.8%.
Overnight in the U.S., optimism was high ahead of third quarter earnings being released with JPMorgan Chase and Delta Air reporting as early as tomorrow. Sentiment is also high on hopes of a stimulus package being inked, which will provide individuals with $1,200 of pocket money.
What to watch today:
- The oil price fell 3% to US$39.53 as U.S. production began to be restored after being shut off after Hurricane Delta.
- Gold slipped from its three-week high and trades at US$1,927.
- Iron ore fell 1.2% to US$124.
- AGM season ramps up locally, with CBA (ASX:CBA), Telstra (ASX:TSL) and EBOS Group (ASX:EBO) holding theirs today.
As for Trading ideas that may be worth a look:
- UBS increased Bapcor’s (ASX:BAP) price target to $8.55. Citi also reiterated the car part accessory business Bapcor as a Buy with a revved up $8.80 target.
- Ahead of ANZ reporting financial year results in two weeks, Bell Potter upgraded the big four bank with a $20.50 target, and reiterated its Buy rating.
- Alliance Aviation Services (ASX:AQZ), Emvision Medical Devices (ASX:EMV) and Catapult Group (ASX:CAT) are all showing bullish charting signals - according to Trading Central.
Last week the Aussie share market had a cracking week, closing 5.4% higher, its best weekly gain since April. Today the Aussie futures are suggesting a fall of 0.1% at the open.
U.S. equities saw their best weekly gain since July with the NASDAQ and S&P500 closing higher.
What to watch today:
- Diggers and Dealers, a mining forum kicks off today with 164 companies presenting.
- Energy stocks closed 9% higher last week, the best week since early April.
- Frontier Digital Ventures (ASX:FDV) goes ex-dividend today and Opthea (ASX:OPT) holds its AGM.
Local trading ideas:
- Liontown Resources (ASX:LTR) was upgraded by Bell Potter as a speculative buy with an increased target of $0.32.
- Citi has upgraded Newcrest Mining (ASX:NCM) to a buy with a $37 target, as its second stage NSW Cadia project has been approved.
- Silver Lake Resources (ASX:SLR), Musgrave Minerals (ASX:MGV) and Auswide Bank (ASX:ABA) are all showing bullish charting signals according to Trading Central.
The Aussie share market is eyeing a lift of 0.4% at the open. All eyes will be on the cyclical sectors tied to economic growth like Energy and Financials which are up the most this week.
Aussie shares are on pace for the best week since April 10 thanks to budget stimulus. U.S. equities are having a good week too on the back of a potential $1,200 payment to individuals.
What to watch:
- The oil price rose 3% to US$41.29, its highest level in almost 5 weeks.
- Gold rose 0.3% after U.S. President Trump said he would not do the second presidential debate next week unless it’s face to face, despite Trump being diagnosed with COVID-19 about a week ago.
- The RBA Financial Stability review will be released today at 11:30am.
- Companies going ex-dividend today: Harvey Norman (ASX:HVN), while ETFs going ex-div include IAF, IOF, IGB, and IHD.
Local trading ideas:
- BINGO (ASX:BIN) was reiterated as a UBS buy, with the international bank increasing BIN’s target price of $3.00.
- UBS maintained Ramsay Health Care (ASX:RHC) as a hold with a $71.20 target.
- Pinnacle Investment Management (ASX:PNI), ReadyTech (ASX:RDY) and FINEOS (ASX:FCL) are all showing bullish charting signals according to Trading Central.
The Aussie market looks set to open 0.4% higher. So far the market has already gained 4.3% this week, its best gain in 20 weeks – so the key is sustaining that.
Overnight, U.S. equities got a kick after U.S. President Trump back peddled in a Tweet, urging Congress to approve COVID-19 stimulus measures like airline support, support for small business and a $1,200 payment to individuals.
Commodities:
- The oil price is back above US$40 despite having a volatile night.
- Gold has slipped almost 3% in two days to US$1,890 on the back of stimulus hopes, with traders ploughing back into equities instead.
What to watch today
- Companies going ex-dividend today: include Pengana International Equities (ASX:PIA), and ARB (ASX:ARB). ARB was initially one of yesterday’s best performers and its shares surged to an all-time high when the car accessory business reported sales growth of 18% in the September quarter. But today, ARB could see a pull back as companies usually trade lower on ex-div days.
Trading ideas:
- Commonwealth Bank of Australia (ASX:CBA) was reiterated asa Bell Potter Buy, with a target price of $73.50, suggesting it will rally 11% from yesterday’s close, supported by yesterday’s budget announcement to help individuals, pensioners, and businesses.
- Saracen (ASX:SAR) is a UBS Buy with a $6.75 target, following the proposed merger with Northern Star (ASX:NST).
- JB Hi-Fi (ASX:JBH), Nick Scali (ASX:NCK) and Vita Group (ASX:VTG), are all showing bullish charting signals - according to Trading Central.
The Aussie market looks set to open 0.3% lower. U.S. President Donald Trump announced that the White House will halt negotiations of a further stimulus package until after the election. The U.S. market was initially marching forth until his announcement, then began to wipe out some of the prior day's gains.
Commodities:
-
Oil jumped 1.8% to US$39.91.
-
Gold eased from its two-week high, falling about 2% to US$1,882.
What to watch today:
-
The focus will be on the budget and how investors and businesses will react.
-
For individuals: low and middle-income earners will be entitled to a tax offset of up to $2,745.
-
Wage subsidies: employers will get $200 a week for hiring people under 30 and $100 a week for hiring people between 30 and 35, and they must work at least 20 hours a week.
-
Businesses with > $5 billion turnover: ability to buy and write off the entire cost of any depreciating asset they buy before June 30, 2022.
-
Infrastructure: $3 billion will go to shovel ready infrastructure projects.
Trading ideas:
-
UBS maintained BHP (ASX:BHP) as Buy stock, with a $41 target. After the mining giant announced it’s buying an extra 28% stake in oil assets in the deep-water Gulf of Mexico assets for US$505 million, which will take its holding to 72%.
-
Whitehaven Coal (ASX:WHC) and Coronado Global Resources (ASX:CRN) were both reiterated as Bell Potter Buy's, but both had their price targets reduced amid a damper coal price outlook.
-
Northern Star (ASX:NST), Saracen Minerals (ASX:SAR) and Resimac Group (ASX:RMC) are all showing bullish charting signals - according to Trading Central.
Well after the ASX ended 2.5% higher yesterday, its best day since June 16 ahead of the budget boost. The Aussie market is likely to lift 0.4% today.
U.S. President Donald has been released from hospital and ahead of the news, U.S. markets rallied. Adding to that positive injection, U.S. lawmakers voted in favour of a $2.2 trillion Democratic coronavirus stimulus package. It now needs to pass through the Republican-held Senate to become law.
What to watch?
- The RBA meets - rates are tipped to remain on hold, with the RBA hinted there is no point in reducing rates as it would only accelerate Aussie’s saving more than spending, something that the pandemic has heighted.
- The Federal Budget will be handed down this evening – we’re expecting an extension of JobKeeper and JobSeeker, phased tax cuts, and an extra $40 billion in infrastructure.
- Keep an eye on commodity stocks as the oil price jumped 6% on stimulus hopes to US$39.
- Gold put on 0.6% to US$1,919.
Trading ideas:
- Mesoblast, (ASX:MSB) was maintained as a speculative Buy by Bell Potter, with a slimmer $7.00 target, implying 98% growth.
- Santos (ASX:STO) is a buy stock for UBS, Bell Potter, Credit Suisse, Morgan Stanley. STO is also a Citi buy with a $7.15 target.
- Wesfarmers (ASX:WES), Orbital Corp (ASX:OEC) and BetMakers Technology (ASX:BET) - are all showing bullish charting signals - according to Trading Central.
The futures are suggesting a lift of 1.2% or 67 points, but trading is expected to be thin given it’s a public holiday in NSW, SA, ACT, QLD – so expect industrials and economic recovery stocks to be stronger, and tech stocks to follow Wall Street lower.
It’s also going to be one of the busiest weeks economically since the pandemic - with the Australian Federal Budget being handed down tomorrow night and the RBA meeting with rates expect to remain on hold, while Westpac has gone out in a limb expecting a cut of 0.1%.
What to watch today?
• Oil tracks steady, US$37, Gold holds at US$1,908.
• On the economic side: NAB confidence numbers are out along with services sector data.
Trading ideas:
• Integrated Research (ASX:IRI) was upgraded as a Buy by Bell Potter, with a new $4.25 target, on the back of the company releasing new products and renewing licences. Bell Potter is forecasting EPS growth of 10%, 11% and 15%, over the next three years.
• AFT Pharma (ASX:AFP) was rated a Hold by Bell Potter, with an increased $5.11 target after seeing a strong rise in sales in over-the-counter medicines associated with the protection of COVID-19 infections.
• Keep an eye on Black Cat Syndicate (ASX:BC8) and Amaysim (ASX:AYS) – both showing bullish charting signals - according to Trading Central.
With the impending U.S. election, and COVID-19 cases rising in Europe, October is likely to be the bumpiest month yet. We saw the Aussie share market fall 1.5% (Mon-Thu), as fund managers and investors adjusted their portfolios, selling down defensive sectors and buying into tech.
In this week’s wrap, Jessica covers:
- (0:20) The revolving door of sectors: Tech up 2.8%, while Utilities and Consumer Staples fall more than 4% each
- (0:38) Standout stock: Premier Investments (ASX:PMV) rises 12%
- (1:34) The final countdown - what to expect in Q4 2020
- (2:34) Fund managers putting cash to work
- (4:17) Sectors to watch in 2021
- (4:44) 16 trading ideas worth a look
The Aussie share market is eyeing a fall of 0.5% at the open.
For the first day of October in the U.S. it was a bumpy one, with equities briefly dipping into the red after a U.S. stimulus vote was delayed to next Thursday, with traders hoping it would be done sooner.
What to watch today:
- On the economic side, retail sales are out today and are expected to fall 4.2%.
- The oil price has fallen 4% to US$38.
- Gold rebounded, lifting 0.9% to US$1,912.
- The iron ore price lifted 2%.
Trading ideas:
- Alumina (ASX:AWC) was upgraded by Citi as a buy with a new $1.80 target.
- SSR Mining (ASX:SSR) was initiated as a UBS buy with a $33 target, following its merger with Alacer.
- Sezzle (ASX:SZL), Netwealth (ASX:NWL) and Paradigm Biopharmaceuticals (ASX:PAR) are all showing bullish charting signals according to Trading Central.
The Aussie futures are suggesting a modest 0.2% or 11 point gain. It’s worth looking out for how stimulus talks develop, as well as the U.S. futures – as that that could affect our afternoon session.
After U.S. equities pulled back for a day, they’ve sprung back into action overnight on better than expected jobs and home sales data. On the political side, the U.S. Treasury Secretary and House Speaker Nancy Pelosi are attempting to craft a fifth stimulus package. All of this saw economic recovery stocks like banks and cruise operators lead the rally, with the Dow rising 1.2%, the broader S&P500 gaining 0.8%, while the tech heavy Nasdaq rose 0.7%.
What to watch today?
- It should be a better day for oil stocks after they declined over 4% yesterday. A rebound looks in order, as the oil price jumped almost 2% overnight to just shy of US$40.
- Gold stocks could see another pull back as the precious metal traced lower again.
- The Aussie Prime Minister’s budget next week plans to invest $1.5 billion into manufacturing, i.e. resources, critical minerals, food and beverages, medical products, recycling and clean energy, defence and space manufacturing. So it could be worth looking at companies in those areas.
Trading ideas:
- Elders (ASX:ELD) was upgraded by Bell Potter as a buy with a new $12.25 target, implying 12% upside from yesterday’s close.
- Santos (ASX:STO) was reiterated as a Buy by UBS with a $6.50 target. Yesterday STO closed at $4.88. Santos was granted NSW environmental approval for the Narrabri Gas Project.
- Alliance Aviation (ASX:AQZ), Medusa Mining (ASX:MML) and Shine Justice (ASX:SHJ) - all showing bullish charting signals - according to Trading Central.
The Aussie share market is eyeing a fall of 0.9% or 56 points ahead of the first of three Trump vs. Biden debates.
U.S. stocks fell to their lows for the day after the New York City Mayor said NY’s daily COVID-19 cases are back above 3%, for the first time in months. That spooked airline investors, and airliners led the decline, with American Airlines, United and JetBlue falling about 4%.
U.S. consumer confidence surged to its highest level since the start of the pandemic, with confidence levels seeing their biggest rebound in 17 years. This reflects that Americans are optimistic about the U.S. recovery being on track.
What to watch today?
- Options expiry - fund managers and investors are unwinding their positions, which will add to the volatility today.
- It should be a positive day for gold stocks, after the gold price lifted over 1% for the second day, to US$1,903, with COVID-19 cases rising in Europe
- Oil stocks may come under pressure as the oil price fell 3.7%, back to under US$40.
- What else to watch: ASX (ASX:ASX) holds its AGM today, Freedom Foods (ASX:FNP) is due to hand down results and this evening in the U.S., GDP growth is released with the market expecting second quarter growth to fall 31.7%, following the 5% fall in Q1.
Trading ideas:
- Corporate Travel Management (ASX:CTD) was upgraded as a Buy by UBS with a new $18.70 price target. UBS thinks CTD has been one of the best performing travel stocks.
- Australian Finance Group (ASX:AFG) was initiated as a Buy by Citi with a $3 price target. AFG control about 40% of the mortgage broking industry, and a cyclical recovery looks to be on the cards, given the reregulation of the industry.
- Accent (ASX:AX1), Macmahon Holdings (ASX:MAH) and American Pacific Borates (ASX:ABR) - all showing bullish charting signals - according to Trading Central. Of those AX1’s fundamental calls almost mirror Trading Central’s technical analysis, meaning its shares could rally to $1.95 - 2.01 over the next 25 days. Bell Potter targets $1.85. Morgans targets $1.84
The Aussie market is eyeing a 0.6% or 38-point lift following U.S. rally. Equities rallied for the second session, and started a brand new week in the green, with banking stocks leading the rally. Elsewhere on the street, other deals were being made, which boosted sentiment. Devon Energy and WPX Energy announced their merger is progressing, which sent their shares over 11% higher. The S&P500 rose 1.6%, while the Nasdaq ended rose 1.9%.
What to watch today?
- The oil price lifted 0.8% to US$40.58, and goldgained1.1% to US$1,886
- Following the Federal government’s plan to invest $800 million in improving the government’s digital technologies, and digital face recognition, it’s worth looking at artificial intelligence and face recognition companies. A company to watch in this space is Appen (ASX:APX) and BrainChip (ASX:BRN) that was just added to the tech index.
- Companies going ex-dividend today include Centuria Industrial REIT (ASX:CIP), Charter Hall Long WALE REIT (ASX:CLW), Cromwell Property Group (ASX:CMW), Centuria Office REIT (ASX:COF), Meridian Energy (ASX:MEZ) and Kirkland Lake Gold (ASX:KLA).
Trading ideas:
- Downer EDI (ASX:DOW) was upgraded to a Buy by UBS with a new $5.00 target. The reason for upgrade is its restructure will deliver $300 million in enhanced cash flows, boosting its yield.
- The a2 Milk Company (ASX:A2M) was downgraded by Bell Potter to a Sell with a $13.75 target. Revenue is expected to fall with no recovery in the Daigou channel expected yet.
- Afterpay (ASX:APT), FlexiGroup (ASX:FXL) and Pental (ASX:PTL) are all giving off bullish charting signals - according to Trading Central. Of those Afterpay’s (APT) fundamental calls mirroring Trading Central’s technical analysis, saying it’s shares could rally to $102 to $107, over the next 22 days. Morgan Stanley targets $101 and Bell Potter targets $99.10.
The Aussie share market is eyeing a 0.4% lift at the open following the 1.7% gain last week.
Today in Victoria, childcare centres reopen, primary schools return and the curfew is scraped, with 127,000 people allowed to return to work. Supermarkets, food distribution centres, abattoirs, seafood and meat processing plants also increase capacity, which is good news for the economy. While at the same time the JobKeeper payment reduces from $1,500 to $1,200 a fortnight.
What to watch today:
- Keep an eye on economic recovery stocks like banks, which saw a huge rally on Friday with Westpac (ASX:WBC) up over 7% and CommBank (ASX:CBA) up 3%, on reduced lending requirements that are likely to be revealed in tomorrow’s budget.
- A lot of property groups go ex-div tomorrow, like Centuria Industrial REIT (ASX:CIP), Charter Hall Long WALE REIT (ASX:CLW), Centuria Office REIT (ASX:COF) and Cromwell Property Group (ASX:CMW).
Local trading ideas:
- Smiggle, Just Jeans and Peter Alexander owner Premier Investments (ASX:PMV) was reiterated by Bell Potter as a buy with a bumped up price of $22, implying 16% growth from Friday’s close. UBS also reiterated PMV as a buy with a $20.50 target.
- Business tech platform, Technology One (ASX:TNE) was reiterated by Bell Potter as a buy with a $9.50 target, implying 20% upside from Friday’s close.
- Mortgage Choice (ASX:MOC), Asaleo Care (ASX:AHY) and SciDev (ASX:SDV) are all giving off bullish charting signals according to Trading Central.
The Aussie share market sees a gain of 1.3% – the best weekly gain in seven weeks. European governments are dealing with their second wave of COVID-19, forcing Australian investors to buy into defensive stocks. Meanwhile, the USD pushed higher, putting pressure on commodities.
In this week’s wrap, Jessica covers:
- (0:12) The Sector Report: Healthcare gets a health kick, rising 4%
- (0:56) Service Stream (ASX:SSM) up 12%, upgraded to a Bell Potter buy
- (1:48) The delayed UK recovery and stocks to watch
- (2:38) Seven stocks to consider with lower for longer interest rates
- (4:28) What to watch: RBA, Federal Budget, Infrastructure spending
- (5:07) Four tips from an expert investor: Magellan’s Hamish Douglass
The Aussie share market is eyeing a red start with a fall of almost 1% at the open.
U.S. equities fell lower overnight as lawmakers struggled to progress a new stimulus deal, despite the Fed Reserve calling upon fiscal help to support the U.S. economy.
What to watch today:
- With the rise of the U.S. dollar, keep an eye on the ETF USD and companies that could benefit from the fall of the Aussie dollar including ResMed (ASX:RMD), CSL (ASX:CSL) and James Hardie (ASX:JHX).
Local trading ideas:
- Service Steam (ASX:SSM) was upgraded by Bell Potter as a buy with a $2.30 price target after NBN Co. announced $4.5b of new network investments, which will see additional fibre laid out for connections, upgrades to business networks and large-scale investments across regional areas which will provide tailwind for SSM.
- Agri chemical company Nufarm (ASX:NUF), was upgraded by UBS as a buy with a new $5.25 price target.
- Harvey Norman (ASX:HVN), Domino’s Pizza (ASX:DMP) and Reece (ASX:REH) are giving off strong bullish charting signals according to Trading Central.
Australia will start to reopen its boarders in a bid to get the economy back on track, while the UK enters tougher restrictions for potentially the next six months. In the U.S., existing home sales soared 2.4% in August, to the highest reading in 14 years, supported by record low interest rates.
Strong earnings, economic news and stimulus hopes supported sentiment and saw U.S. equities attempt to rebound after four days of selling. The S&P500 lifted 1.1%, the Nasdaq was up 1.7%, while the blue chip gained 0.5%.
Commodities:
· Oil nudged slightly higher to US$39.60
· Gold continued to drop and trades at US$1,905 as investors continue to invest in the safe haven U.S. dollar.
· With that the Aussie dollar fell 0.8% to 71.67 US - this has continued to pressure the Iron Ore price, which lost 0.9%.
What to watch today?
· The Aussie futures are suggesting a rise of 1%.
· Services and manufacturing numbers will be in focus today with a preview of what to expect in September, before the official readings are out next month.
Trading ideas:
· Harvey Norman (ASX:HVN) was maintained as a Buy by Citi with a $5.20 target price. HVN’s outlook remains upbeat with year on year July and August re-tax profit nearly tripling.
· Saracen Mineral (ASX:SAR) and Northern Star Resources (ASX:NST) were upgraded by Macquarie with a $6.10 and $16.40 price target respectively.
· Keep an eye on Elders (ASX:ELD), Wesfarmers (ASX:WES) and Base Resources (ASX:BSE) - all three are giving off bullish charting signals according to Trading Central.
Overnight we saw a risk off environment unfold as the UK considers another national lockdown to slow rising infection rates. That saw tourism stocks move lower with Carnival shares down 6.7% and Delta Air falling 9.2%. Elsewhere, investors sold down banks as allegations swirled that a number of international banks have been moving illicit funds over the last two decades. But there was some light - technology shares slightly rebounded – U.S. tech darlings led Wall Street to a record high but the September-blues hit, so overnight investors bit into low hanging fruit. As for the US major indices, the S&P500 lost 1.2%, the Dow fell 1.8% and the Nasdaq fell just slightly, 0.1%.
Commodities:
- Oil lost 4% to US$39.31 after climbing 10% last week
- Gold fell 3% - US$1,910 as investors flowed funds into the safe haven U.S. dollar.
What to watch today?
- The Local futures are suggesting a pull back of almost 1% following Wall Street’s fall.
- Stocks in Hydrogen, batteries, green steel, carbon capture and storage, and soil carbon may be worth a look as they’ve been flagged as the federal government’s priority in low-emission technologies to develop over the next decade.
- The RBA Deputy Governor, Guy Debelle's speech on the Australian Economy and Monetary Policy will be in focus. So look for hints on negative interest rates and if the RBA thinks the second half of 2020 will show solid or tepid recovery.
Trading Ideas:
- Australian Pharmaceutical Industries (ASX:API), which owns Priceline, Soul Pattinson Chemist and Clear Skincare clinics was downgraded to a Bell Potter Sell with a $0.85 price target, implying a 17% pull back from yesterday’s close of $1.02.
- Laybuy Group (ASX:LBY) was initiated as Bell Potter speculative Buy with a $2.40 price target, implying 41% upside from in a year, from yesterday’s close of $1.71.
- And keep an eye on Johns Lyng Group (ASX:JLG), Shine Justice (ASX:SHJ) and Aspen Group (ASX:APZ) -all three are giving off bullish charting signals - according to Trading Central.
The Aussie share market is eyeing a fall of 0.6% at the open following Wall Street’s decline.
U.S. equities closed lower on Friday and saw their third straight weekly fall. On Wall Street, investors continued to sell out of the Tech sector and invest into the best performing sector this month, Materials.
What to watch:
- This week, manufacturing numbers will be released in the U.S., UK, the Eurozone and Australia, while Central banks will be meeting in China and New Zealand, deciding the future of interest rates.
Local trading ideas:
- Costa Group (ASX:CGC), Australia’s largest horticultural company, was initiated as a Bell Potter buy with a $4.05 price target, implying 24% growth in a year from Friday’s close of $3.27. Citi and UBS also have the stock as a buy.
- Uniti Group (ASX:UWL) was upgraded by Bell Potter with a $1.90 target, implying 29% growth in a year from Friday’s close of $1.47.
- Structural Monitoring Systems (ASX:SMN), Integrated Research (ASX:IRI) and Tesoro Resources (ASX:TSO) are all giving off bullish charting signals according to Trading Central.
There's light at the end of the tunnel this week, with 111,000 Aussies returning to work rather than the projected further loss of 35,000 jobs. Plus, the Aussie share market followed the U.S. blue-chip rise, closing 0.4% higher (Mon-Thu).
In this week’s wrap, Jessica covers:
- Three stocks to watch given home sales are up 3.6%
- The Sectors report: Real Estate rose 2.3%
- Five stand out stocks this week
- Aussie employment data beating expectations - sole traders and females leading the charge
- Victorian COVID-19 cases trending lower and likely to continue
- Two stocks to consider: Aristocrat Leisure (ASX:ALL) and Accent Group (ASX:AX1)
The Aussie share market is eyeing a 0.3% gain at the open with the focus on Victorian COVID-19 cases declining. The Aussie share market has gained 0.4% so far this week, this puts the market on pace to close higher for the first time in 6 weeks.
U.S. equities had their second straight negative session overnight, while stocks managed to end above their lows on Thursday. U.S. weekly job claims rose by 860,000 more than the expected 850,000, but the silver lining is that it’s the third week now unemployment numbers have been under 1 million.
Local trading ideas:
- Centuria Industrial REIT (ASX:CIP), Integrated Research (ASX:IRI) and NZME (ASX:NZM) are giving off bullish signals according to Trading Central’s charting.
- Immutep (ASX:IMM), an immunotherapy business fighting metastatic cancer, was initiated as a Bell Potter speculative buy with a $0.60 target, implying 179% price growth in a year.
- Beach Energy (ASX:BPT) has been called out a high risk buy by Citi with a $1.94 target as its generating a higher level of cash than its peers and selling higher amounts of gas. Citi estimates BPT will generate $1.1 billion in free cash flow, which is worth $0.30 a share.
The Aussie share market is eyeing a 0.2% fall at the open following Wall Street’s mixed lead.
U.S. stocks mostly fell overnight for the first time in three days, this came after the U.S. Federal Reserve dropped its economic growth forecast for next year to 4% from 5%, and shaved 2022’s GDP forecast to 3%.
What to watch today:
- The focus will be on employment numbers for August. We know 115,000 people gained jobs in July, but forecasts for August are dire as Victoria has been in lockdown. The unemployment rate is likely to worsen from 7.5% to 7.7%, but the RBA expects unemployment to surge to 10%.
- After the oil price gained 8% in two days, keep an eye on oil stocks: Oil Search (ASX:OSH), Origin Energy (ASX:ORG), Santos (ASX:STO), Woodside (ASX:WPL) and WorleyParsons (ASX:WOR).
Local trading ideas:
- Temple & Webster (ASX:TPW), Netwealth (ASX:NWL) and Breville Group (ASX:BRG) are giving off bullish signals according to Trading Central’s charting.
- The British High Court has ruled in favour of QBE (ASX:QBE) in two of three COVID-19 insurance case payouts. This reduces QBE’s UK business interruption costs to US$70 million. Bell Potter reiterated QBE as a buy but shaved its price target to $11.10 as a result, this implies 21% share price growth in a year from yesterday’s close of $9.20.
- The a2Milk Company (ASX:A2M) has been called out as a sell by Citi.
The Aussie share market futures are suggesting the market will lift 0.8% following Wall Street’s gain, which was led by tech stocks bounding ahead. In afterhours trade – better than expected earnings results came through from FedEx and Adobe which lifted their shares by 9% and 2% respectively. However – the U.S. futures are flat as investors are awaiting comments from the US Federal Reserve.
Commodities:
- Oil gained 3% US$38.39
- Gold is US$4 less than it was yesterday, now at US$1,961.
- The Aussie dollar just nudged over 73 US cents, which is its highest level in three weeks, as the safe haven US dollar continues to come under pressure.
What to watch today?
- New home sales for August. The previous reading showed home sales fell almost 11% in July, but today’s read is not expected to be that stark. So keep an eye on building material construction firms like Brickworks (ASX:BKW) CSR (ASX:CSR) and Boral (ASX:BLD).
- Costa Group (ASX:CGC) and Supply Network (ASX:SNL) go ex-dividend today.
Trading ideas that may be worth a look:
- After Citadel’s (ASX:CGL) incredible 40% rally on Monday after receiving a takeover offer for $5.70 valuing the business at $449 million, Bell Potter downgraded the stock to a hold.
- Bell Potter had a look back at the August 2020 reporting results. Of its coverage, they upgraded MyState (ASX:MYS) but called Macquarie Group (ASX:MQG) as its top banking pick. ANZ is its preferred big four bank, while Suncorp Group (ASX:SUN) is their preferred regional/diversified play.
- Gold Road Resources (ASX:GOR) and NRW Holdings (ASX:NWH) are giving off bullish signals according to Trading Central’s data. Take NRW for example, it’s indicated their shares may rise from yesterday’s close of $2.15 to $2.56 - $2.66 over the next 15 days, according to standard technical analysis.
COVID-19 vaccine hopes; electric car demand picking up in China; and the Tech tech-takeover- kicked Wall Street back into buying the dip and rebound mode. Sentiment got a boost when AstraZeneca resumed phase three trials following a halt due to safety reasons. This saw the Nasdaq rise 1.9%, the S&P500 gain 1.3% and the Dow lift 1.2%,
Commodities
- Oil fell 0.2% - US$37.26
- Gold, gained US$17.20 or 0.8% to US$1,965.
- The Aussie dollar got a bit of a boost overnight, rising to 72.91 US, which is its highest level in almost three weeks, as the USD continues to come under pressure.
What to watch today?
- The focus will be on the RBA meeting minutes - which is expected to pave out how much bond buying the central bank has conducted since August in a bid to stimulate the economy.
- The futures are suggesting the Aussie market will pull back 0.2% following the 0.7% gain yesterday.
- News Corp (ASX:NWS), Ingham's Group (ASX:ING), Plato Income Maximiser (ASX:PL8), Pro-Pac Packaging (ASX:PPG), CML Group (ASX:CGR) & Data#3 (ASX:DTL) all go ex- dividend today transferring the dividend right to shareholders, so they could see some selling.
Looking at Trading ideas that may be worth a look:
- Macquarie’s (ASX:MQG) yesterday lowered its expected NPAT to $950 million for the first half of this financial year. Overnight, Bell Potter maintained the bank as a buy with a $135.00 target, while UBS reiterated MQG as a hold.
- Aroa Biosurgery (ASX:ARX), the soft tissue regenerative company for hernia and reconstructive surgery, had its buy rating reiterated by Bell Potter with a $2.10 , implying 61% upside from yesterday’s close of $1.29.
- Saracen Mineral (ASX:SAR) may be worth a look, as Trading Central’s data tells us that SAR may rise to $6.40 - $6.70 following yesterday’s close of $5.24 in the next 29 days, according to standard technical analysis.
- Sezzle (ASX:SZL) - its shares may end their downtrend going off Trading Central’s standard technical analysis. SZL also expects sales to hit $1 billion by the end of this year.
The Aussie share market is shaping up for a quiet start to the week with the futures eyeing a gain of 0.1% at the open. This comes after Wall Street wrapped up its session on Friday on a mixed note.
A very busy week is on the cards for markets with the RBA, the U.S. Fed, Bank of England and Japan to shed light on the state of each of their economies and potential further stimulus, as they release their central bank meeting minutes.
What to watch today:
- Macquarie (ASX:MQG) announced ambiguous guidance to the market for the first half of this financial year, saying its results will be down 35% compared to the same time last year and 25% less than the second half.
- Breville (ASX:BRG), Chorus (ASX:CNU), Hub24 (ASX:HUB), Sandfire Resources (ASX:SFR) and Tassal (ASX:TGR) go ex-dividend today.
Local trading ideas:
- Aerial imaging company Nearmap (ASX:NEA), had its buy rating upgraded by Citi with a new $3.15 price target.
- AMA (ASX:AMA) had its buy rating upgraded by Bell Potter, increasing its price target by 13% to $0.85, implying a gain of 25% from Friday’s close of $0.63
- Oklo Resources (ASX:OKU), Adriatic Metals (ASX:ADT) and Champion Iron (ASX:CIA) may be worth a look, as Trading Central’s data tells us their shares are giving off a bullish signal, indicating their shares may rise from Friday’s close.
It's been an eventful week as the ASX reshuffles its deck. But not all eyes are on the domestic market, as key events unfold around the U.S. Presidential election and the booming tech sector loses a touch of its charge.
In this week’s wrap, Jessica covers:
- (0:37) The Sectors report: Oil falls and Energy retreats
- (0:48) Rio Tinto (ASX:RIO) gains 5% as investors back copper
- (0:57) Two things to consider with the current pullback
- (1:48) Consumer & business sentiment rebounds
- (2:27) Three things to look out for next week
- (4:47) The S&P ASX20 reshuffle - Coles (ASX:COL) joins, Suncorp (ASX:SUN) ousted
- (5:34) Appen (ASX:APX) & Fisher & Paykel Healthcare (ASX:FPH) join the S&P ASX100
- (5:48) Five key stocks that joined the S&P ASX200
Aussie investors are expecting a negative session with the futures eyeing a 1.3% fall at the open. So far this week, the market is down 0.3% and is heading for its fourth weekly pull back.
Markets attempted to rally overnight but the U.S. tech pull back returned, as investors questioned how expensive U.S. stocks are based on the earnings they generate.
What to watch today:
- Cleanaway Waste(ASX:CWY) goes ex- dividend today, along with Argo Global Listed Infrastructure (ASX:ALI), The Environmental Group (ASX:EGL), Grange Resources (ASX:GRR), Prominence (ASX:PRM), Sequoia (ASX:SEQ) and VEEM (ASX:VEE). All transferring the dividend right to shareholders.
Local trading ideas:
- Fertilizer and explosive company, Incitec Pivot (ASX:IPL) was upgraded by UBS from a hold to a buy, with a $2.40 target.
- Medical software company Pro Medicus (ASX:PME) was downgraded from a buy to a hold by Bell Potter with a $26.50 price target, implying 2% upside from yesterday’s close at $25.98.
- Saracen Mineral (ASX:SAR), Musgrave Minerals (ASX:MGV) and Tesora (ASX:TSO) may be worth a look, as Trading Central’s data tells us their shares are giving off a bullish signal, indicating their shares may rise from yesterday’s close.
The Aussie share market is set to lift 1.3% at the open as investors look to buy back into the market, given it’s now back at late June prices.
What to watch today:
- CSL (ASX:CSL) goes ex-dividend today, transferring the dividend right to shareholders. So if you’ve been looking to buy CSL, today could be your day, as companies generally trade lower on days they go ex-div. Other companies going ex-div include: Independence Group (ASX:IGO) and South32 (ASX:S32).
- Sky TV (ASX:SKT) released its financial year results today, showing a 35% jump in revenue.
Local trading ideas:
- Bell Potter restamped internet service provider, Uniti Group (ASX:UWL), as a buy. Bell Potter reduced its price target by 20% to $1.75, however that still implies almost 36% share price growth in a year.
- Afterpay (ASX:APT) may be worth a look too, as Trading Central’s data tells us its shares are giving off a bullish signal, a ‘key reversal bar’ pattern, indicating its downward trend has likely broken and its shares may rise from yesterday’s close of $74.05. APT is a Bell Potter buy with a $99.10 target, Morgan Stanley backs APT with a $101 target.
- ArchTIS (ASX:AR9), a cybersecurity company, is also giving off a bullish signal according to Trading Central’s charting. AR9 shares have already rallied over 200% this year, with the company working with the Australian Government and the defence force.
The Nasdaq officially entered correction territory, collecting a 10% loss over the last three trading days. What was noteworthy was that Tesla shares fell 21% - their biggest drop on record - after Tesla was snubbed from being added to the S&P500. Other tech darlings that have pulled markets to all high, this year like Apple and Microsoft both took another hit, losing 6.7%. This explains why the indices retreated, as tech stocks are the largest part of the market. The Nasdaq fell, 4.1% while the benchmark S&P500 ended 2.9% lower.
Commodities:
- Gold gained a touch of shine, rising US$10 overnight to US$1,943
- Oil extended its drop, falling 7% to US$36.76
What else to watch:
- The Aussie share market put on 1.4% on Monday to Tuesday, but looks like it could turn south today – as the futures suggest a 1.6% or 98-point fall following Wall Street’s pull back.
- Companies going ex-dividend, i.e. transferring the dividend right to shareholders today, include: Adairs (ASX:ADH), Brambles (ASX:BXB), Nine Entertainment (ASX:NEC), Australian Finance Group (ASX:AFG), Accent Group (ASX:AX1).
- Yesterday, we saw business confidence levels improve more than expected in August – today we will learn how consumers are feeling.
Trading Ideas:
- JP Morgan upgraded Fortescue Metals (ASX:FMG) from a neutral (hold) to an overweight as iron ore prices has surged to a six-year high. JP Morgan projects 9% dividend yield over the next three years.
- GrainCorp Ltd (ASX:GNC) was maintained as a Bell Potter hold stock with a $4.85 target, implying a 8% lift over the next year.
- Newcrest Mining (ASX:NCM) may be worth a look, as Trading Central’s data identified its shares are giving off a bullish signal, indicating its price may move higher off yesterday’s close of $31.48, to $35.10 - $36.00.
U.S. and Canadian markets closed overnight for Labour Day, rendering a silent night. London’s market rose 2.4%, German and French markets followed off the back of economic cyclical stocks like autos leading the gains.
Commodities:
• Gold steady at US$1,935
• Oil fell further below US$40, losing over 5% in the last 2 sessions, now trading at US$39.07.
• Copper trades at US$3.05, its highest since June of 2018, driven by Chinese demand.
The Australian Dollar:
• The AUD tracks lower at 72.7 U.S. cents, holding a near two-year high.
What to watch today:
• The Aussie share market is expected to rise for the second day, with the futures suggesting a 0.4% gain, or a lift of 25 points. Yesterday, the market rose 0.3%. Not enough to recover from the market’s fall last week, marking it’s third fall in 3 weeks.
• The U.S. futures will be under scrutiny as they attempt to rebound from Thursday and Friday’s fall, in which the Nasdaq lost 5.3% - it’s biggest fall in 5 months.
• Many companies are going into ex-dividend from here on in. Today, Austal (ASX:ASB) BlueScope (ASX:BSL), Jumbo Interactive (ASX:JIN), and Northern Star (ASX:NST) all go ex-dividend.
• Business confidence numbers are out for the month of August, expected to remain very weak.
Trading ideas:
• QBE (ASX:QBE), Australia’s second largest insurer, was reiterated as a Bell Potter buy with a $11.90 target.
• Northern Star Resources (ASX:NST), Sandfire Resources (ASX:SFR), and Champion Iron (ASX:CIA) may be worth a look. Trading Central’s data identified all three of the stocks are showing bullish signals, indicating their prices may move higher off yesterday’s close, according to standard principles of technical analysis.
Looks like it could be a quiet day as U.S. and Canada’s markets are closed for public holidays this evening Aussie time. The local market will get to react to having Victoria’s lockdown extended, with the Aussie futures earlier suggesting a 0.6% fall at the open.
A ray of sunshine came over the U.S. with employment conditions improving in July. This was more than expected with the unemployment rate falling to 8.4% from 10.2% in July, as many returned to retail and hospitality jobs. But until the pandemic is over, employment is expected to remain weak.
The Australian dollar trades at 72.8 U.S. cents, holding a near two-year high.
What to watch today:
- Companies going ex-dividend: St Barbara (ASX:SBM), Sonic Health Care (ASX:SHL), ASX (ASX:ASX) and Bega Cheese (ASX:BGA).
- Myer (ASX:MYR) is due to release its full year results today.
- On Friday it was announced that MYR will be removed from the ASX100 on the 21st of September. Other companies removed include Regis Healthcare (ASX:REG) and SG Fleet Group (ASX:SGF), while companies that are thriving online were added the ASX100. This includes Appen (ASX:APX) and Temple & Webster (ASX:WEB).
- Coles (ASX:COL) and Fortescue Metals (ASX:FMG) were added to the top 20 ASX index, while Scentre (ASX:SCG) and Suncorp (ASX:SUN) were ousted. Really reflecting of the fact that supermarkets and miners are doing well in the pandemic, while property and banking stocks are not.
- On the economic side of things, Services sector data is out today for August and ANZ jobs ads are out.
Local trading ideas:
- Sonic Healthcare (ASX:SHL) was upgraded by UBS from a sell to a neutral, while increasing SHL’s price target to $32.10.
- NOVONIX (ASX:NVX), Proteomics International (ASX:PIQ) and Kingsgate Consolidated (ASX:KCN) may be worth a look, as Trading Central identified all three of those stocks are showing bullish signals, indicating they may move higher according to standard principles of technical analysis.
The hustle and bustle of reporting season is over, but the Aussie share market continues to twist and turn as Australia officially entered its first recession in 30 years. Aussie tech stocks also came under pressure this week as investors feared increased competition following PayPal's entry into the buy now pay later market.
In this week’s wrap, Jessica covers:
- (0:40) The Aussie Tech sector and the U.S. downturn
- (1:15) Afterpay (ASX:APT) falling and Lendlease (ASX:LLC) rising
- (2:28) Key themes emerging in the market - the China-ore love story
- (4:15) The first Australian recession in 30 years
- (4:28) Changes in spending and saving habits
- (5:10) Sectors and stocks to watch: Consumer staples & Coles (ASX:COL), Healthcare & CSL (ASX:CSL), Tech & Life360 (ASX:360)
It will be a day of red for the Aussie share market bracing for a fall of 1.95% at the open.
Just a day after the benchmark S&P500 and tech-heavy Nasdaq hit brand-new record highs, U.S. equities tumbled overnight, seeing their biggest drop in months as investors locked in profits. Despite the better than expected economic news with jobless claims falling more than expected, investors took the opportunity to cash in on the stocks that have been driving the market higher over the last five months.
What to watch today:
- Keep an eye on U.S. futures that have calmed down a bit, earlier they were indicating heavy selling would continue in the U.S. this evening.
- This evening in the U.S., monthly payroll data is out for August.
Local trading ideas:
- Life360 (ASX:360) was reiterated as a top Bell Potter buy overnight, increasing its target to $7, implying 64% share price growth from yesterday’s close.
- Toll road operator Transurban (ASX:TCL) was upgraded by UBS from a hold to a buy with a $15.50 target.
- ReadyTech (ASX:RDY) is showing a "Bullish flag" chart pattern according to Trading Central’s data, which tells us the stock may rally from yesterday close of $1.93 to $2.19 to $2.25, over 5 days according to standard principles of technical analysis.
The Aussie share market should see a lift of 0.7% at the open, making a nice addition to yesterday 1.8% gain.
Wall Street had another smashing night with the benchmark S&P500 and tech-heavy NASDAQ hitting brand new record highs.
The AUD fell to 73.35 U.S. cents, dragged by weaker than expected Aussie GDP data yesterday.
What to watch today:
- After learning the Aussie economy shrank 7% from April to June, more than the 6% forecast, the Tourism Minister is now pressuring states and territory to open their boarders, saying the government will lose $55 billion this year if borders remain shut.
- On an economic front, import and export data is out for July, known as the balance of trade. The market is expecting a $5.4 billion surplus, meaning we’re expected to see more goods exported.
- Companies to keep an eye on: Fortescue Metals (ASX:FMG), BHP (ASX:BHP), Rio Tinto (ASX:RIO) and CSL (ASX:CSL).
- This evening in the U.S., import and export figures for July will be released.
Local trading ideas:
- Afterpay (ASX:APT) had its buy rating upgraded by Bell Potter, giving it a price target of $99.10, implying 20% share price growth from yesterday’s close of $82.50.
- Midway (ASX:MWY), Australia’s biggest Woodfibre processor and exporter, was given a sharp upgrade from a hold to a buy by Bell Potter with a $1.25 price target, implying 36% share price growth. Midway was upgraded following its improvement in cashflows, reduction in debt, and that pulp prices reached the bottom of their cycle.
- Boral (ASX:BLD), Australia’s largest supplier of building and construction materials was reiterated as a UBS buy with a $4.30 price target.
Records were smashed in the U.S. overnight for two key reasons: (1) U.S. factory activity in August saw its biggest expansion since November 2018 and (2) video conferencing company, Zoom, reported a 360% jump in revenue, pushing its shares up 41%. The S&P500 ended 0.7% higher, closing at brand new record, while the Nasdaq soared 1.4% also breaking its prior record.
Commodities:
- Gold lifted by US$2 compared to yesterday, hitting US$1,979
- Oil trades steady atUS$42.76 after encouraging manufacturing numbers came through, however U.S. oil supply fell for the sixth week
What to watch today:
- Aussie share market should see a lift today, futures are suggesting at 0.4% gain
- China suspends barley imports from CBH, claiming there were pests in a shipment.
- Economic front: GDP data is out today, showing how much the economy shrank from April to June. Estimates suggest that GDP shrank 6% in the second quarter, which means we will officially enter a recession for the first time in 30 years.
- The Australian dollar took a breather but holds two-year high territory, 73.74 US cents as the U.S. dollar came back in favour.
- BHP listed in New York gained 3.1% overnight, so you’d think the ASX listed BHP could follow.
As for Trading ideas:
- Zip (ASX:Z1P) was downgraded to a sell by Citi, giving it a price target of $6.90. Yesterday Z1P fell 13% to $7.99. However its outperformed the market of late, rising over 35% in the last month. The entry of PayPal increases concerns over the medium-term – in particular, Zip’s acquisition of Quadpay could go head to head with PayPal’s pay in four. Hence Citi downgraded Zip to a sell.
- Aristocrat Leisure (ASX:ALL) was reiterated as a UBS buy, while dropping its target to $29.60. The most upside for Aristocrat comes from online with 35% digital growth expected in the second half of the year.
- Silver Lake Resources (ASX:SLR) hasformed a bullish "continuation wedge" chart pattern according to Trading Central’s technical analysis. This indicates SLR shares could rise from yesterday’s close of $2.23 to $2.70 - $2.85 over the next 18 days according to standard principles of technical analysis. Macquarie has a $2.60 price target for SLR.
The Australian dollar has continued to soar, hitting a new two-year high overnight, 73.75 US cents. The reason for that is that the U.S. dollar continues to retreat, as inflation is now being encouraged to rise to over 2%, while interest rates are likely to remain at record lows for some time. Overnight, U.S. indices closed mixed, with the top 30 stocks, the Dow Jones falling 0.8%. The Nasdaq meanwhile gained 0.7%, supported by Apple shares rising 3.4%, and Amazon and Intel rising over 1% each.
The month of August marked great significance as both the broader S&P500 and Dow rose 7% - their best gain since the 1980's. This came as the ASX200 closed higher for the 5th month, up 2.24% - the best return since 2009.
Commodities:
- Gold holds steady where it was yesterday at US$1,974
- Oil fell 0.4% to US$42.82.
What to watch today:
- Aussie futures set to lose 0.96%, or 58 points at the open
- The RBA meets today – rates tipped to remain on hold at 0.25%
- BHP listed in New York lost 1.4%, Rio similarly fell by 1.2%
Trading ideas:
- Temple & Webster (ASX:TPW) shares soared 18% yesterday to a record all time high – $9.69 after delivering results that were much stronger than expected. Its sales have risen 161%, and Bell Potter have increased its price target to $11.40.
- PointsBet (ASX:PBH) shares fell about 7% yesterday, but it managed to remain in record high territory at $13.03. Bell Potter have upgraded the stock’s buy rating, and increased the price target to $18.40.
- Sezzle (ASX:SZL) shares fell 9.4% yesterday to $10.27, after reporting its loss sank from $4.8m to $8.2m in the half year to June 30. However, its active merchants and customers increased 220-340%. Ord Minnett increased Sezzle’s price target to $11.80.
The Aussie futures are suggesting a 0.7% fall at the open despite U.S. stocks shining on Friday. This really reflects how differently we have been performing to the U.S. market of late, given their market is mainly tech stocks and ours is heavily made up of banks and miners.
The Australian dollar has scaled to its highest level in two-years to US$0.736, with the U.S. dollar continuing to fall. It has continued to drop since the U.S. Federal Reserve said it would let inflation rise to over 2% and keep interest rates at record levels.
What to watch today:
- The market looks like it will close higher for August, its fifth positive month.
- Economic data will come back into focus this week with the RBA meeting tomorrow and GDP data out on Wednesday, with Australia to officially enter a recession for the first time in almost 30 years.
- Bubs Australia (ASX:BUB) reports results today and Zip Co (ASX:Z1P) holds it AGM.
Local trading ideas:
- Intellectual property business, QANTM Intellectual Property (ASX:QIP) was reiterated as a Bell Potter buy, while the broker decreased QIP’s target price to $1.60, implying 44% share price growth from Friday’s close.
- Buy now pay later group Spilitit (ASX:SPT) is giving off a bullish trend according to Trading Central’s standard technical analysis principals. Keep in mind SPT is not yet covered by a lot of brokers. However according to Trading Central analysis, SPT shares may rise from $1.83 to $2.35 - $2.45 over the next 50 days.
We saw 35 companies report this week, the busiest reporting season week in August. Most results came in line or beat expectations, while a handful of reports dragged the chain.
In this week’s wrap, Jessica covers:
- (0:6) Reporting Season's final dash
- (0:16) Sectors: Tech shines, while Utilities dampen
- (0:5) Who beat, who met, and who missed expectations?
- (2:49) The reporting season big picture
- (3:18) Results to watch next week: Bubs Australia (ASX:BUB) and Cooper Energy (ASX:COE)
- (3:45) Ex-dividend dates coming up including: Ansell (ASX:ANN), Steadfast Group (ASX:SDF) and Amcor (ASX:AMC)
The Aussie share market is eyeing a 0.2% fall at the open today.
It was a monumental day in the U.S. on Thursday as the Federal Reserve unveiled a new framework to let inflation run above its 2% goal, while it would keep interest rates lower for longer. This will encourage wage growth and encourage people back into the work force, while also helping businesses keep credit costs low. This news sent treasury yields higher, which lifted financial stocks like JP Morgan and American Express.
Oil lost about US$0.40 to US$43.04 as one of the strongest hurricanes in years made landfall in the heart of the Gulf of Mexico’s oil and gas production.
Companies reporting today:
- Australian Finance Group (ASX:AFG), Boral (ASX:BLD), Costa Group Holdings (ASX:CGC) and Harvey Norman (ASX:HVN).
What to watch today:
- Keep an eye on BHP (ASX:BHP) and Rio Tinto (ASX:RIO), as both of their UK and U.S. listed entities closed lower overnight.
Local trading ideas:
- Accent Group (ASX:AX1) was reiterated as a Bell Potter buy overnight, increasing AX1’s price target to $1.85. That implies 21% share price growth in a year, from yesterday’s close.
- City Chic Collective (ASX:CCX) was reiterated as a Bell Potter buy, increasing CCX’s price target to $3.95. That implies 19% share price growth in a year, from yesterday’s close. Bell Potter sees significant upside in its expansion into the U.S. and thinks it will benefit from the online shift.
- UBS reiterated data centre and cloud business NEXTDC (ASX:NXT) as a buy with a 12-month price target of $14.15. UBS expects returns to increase and has modelled earnings will continue to grow for the next five years, while its debt to equity will decrease.
The Aussie share market is eyeing a 0.3% lift today at the open, which will rub out some of yesterday’s 0.7% fall.
Last night U.S. manufacturing goods orders rose 11.2% in July, recovering from the sharp fall in March and April. Sentiment also got a kick as COVID-19 vaccine hopes were lifted when Moderna posted promising results from a small trial of patients.
What to watch today:
- Afterpay (ASX:APT) just reported full financial year results. Earnings (EBITDA) came in at $44.4 million in the year, stronger than its own expectations of $43 million. APT’s price could jump to about $94 at the open today with brokers expected to upgrade their target prices given its expansion into Europe and the U.S., Morgan Stanley’s the most bullish at $101.
Local trading ideas:
- MTS shares formed a pattern that indicates it may rise from yesterday’s close of $2.99 to $3.26 - $3.32 over the next 9 days, according to standard principles of technical analysis. Metcash’s results showed strong sales momentum and Citi expects this to continue, which is why MTS is a Citi buy with a $3.50 price target.
- Jewellery business Lovisa Holdings (ASX:LOV), was upgraded by Bell Potter with the broker bumping up its price target to $8.35, implying 14% growth from yesterday's close of $7.30. With trading, building and revenue growing despite the pandemic, it looks like the business is gaining momentum as expected.
- Car dealership business A.P. Eagers Automotive (ASX:APE), was downgraded from a buy to a hold by Bell Potter with the broker increasing its price target to $9.50, indicating its share price will only rise 6% from yesterday's close of $8.96.
The Aussie share market opened 0.6% lower in the first 10 mins of trade, as the futures predicted. The market continued to fall in the first hour - with investors digesting weaker than expected financial year report cards, leaving the market sitting 1% lower at 11am.
On the downside:
- Financial software and advice provider, Bravura (ASX:BVS) is one of the worst performers on the market today – its shares are down 15% dragging BVS almost back to its COVID-19 low. BVS reported a 22% jump in profit but the market is focused on the uncertainty of its new sales.
- Whitehaven Coal (ASX:WHC) is down 8%, on the back of full year results that were largely in line with estimates.
On the upside:
- Waste business, Cleanaway Waste Management (ASX:CWY) is the best performing stock so far this session up 8.5% after reporting its revenue rose 2% to $2.33 billion in the year, while all divisions made a profit, beating market expectations.
- Fintech business, HUB24 (ASX:HUB) is up 6% to $16.26, after hitting a record all-time high earlier today – as Credit Suisse and Citi upgraded the stock overnight, Citi giving HUB a $17.40 target. HUB’s financial results were out yesterday, showing much stronger inflows into the financial platform than expected, something Credit Suisse expects will continue.
- We are also seeing oil stocks like Oil Search (ASX:OSH) and Cooper Energy (ASX:COE) trading higher after the oil price rose to its highest level in five months US$42.45 on the back of storm-driven output cuts.
Trading ideas:
- Ship builder, Austal (ASX:ASB) was upgraded by Citi after it handed down its full financial year results – showing an improvement in profitability. Citi upgraded ASB’s earnings estimates by 10%, has a buy rating on the stock and a target of $4.50.
- Fortescue Metals (ASX:FMG) is now being sold around $18.50, as there’s downside risk to the iron ore price. FMG has strong free cash flows and is focused on returning surplus cash to shareholders.
Moving to overseas, sentiment is high, for two key reasons, (1) COVID-19 cases are continuing to fall over the month, and (2) the U.S. and Chinese officials reaffirmed the phase one trade deal is on track.
If you look at the U.S. futures - they’re indicating U.S. equities will mostly open positive, indicating the S&P500 and Nasdaq will rally off Tuesday’s record closes.
The futures are looking at a gain of 0.6% for Aussie equities - a nice addition to yesterdays 0.3% lift, as well as the 35% rise from the COVID-19 low. Overnight in the U.S., the S&P and the Nasdaq reached brand new record closing highs, following the FDA’s approval of the use of plasma as a treatment for COVID-19 patients. Furthermore, positivity was instilled by Trump’s work to fast-track the AstraZeneca/Oxford University COVID-19 vaccine. This positive sentiment helped the S&P500 gain 1%, rising above 3,400 for the first time.
Over to commodities, gold fell to US$1,937 as global equities surge from the potential COVID-19 vaccines. Oil similarly fell 0.5% due to an impending tropical storm threatening the Gulf Coast.
Companies reporting today
- Ansell (ASX:ANN), which has been front and centre with PPE distribution. Blackmores (ASX:BKL) the vitamin maker, City Chic Collective (ASX:CCX) the online and U.S. women’s clothing company, and Nanosonics (ASX:NAN) – the infection prevention company.
- Additionally, oil companies; Oil Search (ASX:OSH) and Ampol (ASX:ALD) are on today, while port and logistics company QUBE Holdings (ASX:QUB), and Propel Funeral Partners (ASX:PFP) are set to report too.
Trading ideas:
- Virgin Money (ASX:VUK) is showing a bullish ‘hammer signal’ using standard technical analysis from Trading Central.
- CBA (ASX:CBA) may fall from yesterday's close of $68.95 to the range of $60.75 - $62.25 over the next 34 days according to standard technical analysis from Trading Central. This is why Bell Potter has downgraded CBA from a buy to a hold with a $78.00 price target. UBS targets $74.70.
- Afterpay’s (ASX:APT) buy rating was upgraded by Bell Potter yesterday following the announcement that it will buy Spanish based European buy now pay later company Pagantis.
The Aussie futures are eyeing a fall of 0.2% at the open, despite U.S. stocks on Friday scaling to another fresh record high, with the S&P500 up 0.3% and the Nasdaq up 0.4%.
Trump announced he’s considering fast tracking AstraZeneca’s vaccine before the election, while he also authorised plasma treatment in COVID-19 patients. On the economic side, green shoots continued to sprout as the U.S. service sector grew at its quickest pace in 17-months.
What to watch today:
- Afterpay (ASX:APT) reported that it’s expanding into Europe.
- Companies reporting this week: Fortescue Metals Group (ASX:FMG), Nearmap (ASX:NEA), nib (ASX:NHF), St Barbara (ASX:SBM), Super Retail Group (ASX:SUL) and Chorus (ASX:CNU).
Local trading ideas:
- Inghams (ASX:ING) buy rating and price target was upgraded by Bell Potter to $4.10, implying 21% share price growth from Friday’s close. Profit was in line with forecasts and no guidance was given.
- MyState (ASX:MYS) was reiterated as a Bell Potter buy while dropping its price target 9% to $4.10, mainly as a result of not paying a final dividend which drops its payout ratio. What’s important is it didn’t cancel the dividend due to performance but to conserve capital. Bell Potter expects 11% share price growth from Friday’s close.
- Car cooling system company, PWR Holdings (ASX:PWH), had its buy rating and price target upgraded by Bell Potter, giving it a price target of $5.25 after it delivered much stronger results than forecasted last week. Although it didn’t given guidance, PWR is expecting a strong rebound in FY21.
The Aussie share market has slipped 0.1% this week (Mon-Thur), its first fall in three weeks as investors sift through 30 company reports - the busiest reporting season week so far.
In this week’s wrap, Jessica covers:
- (0:21) Seven companies that beat market expectations
- (0:33) WiseTech Global (ASX:WTC) sky rockets 38% after reporting
- (1:10) 16 companies that reported in-line
- (1:33) Seven that missed market expectations
- (1:54) Three emerging themes worth thinking about
- (3:22) What to consider if you want to generate above average returns
- (3:51) Over to the U.S.: Apple becomes a US$2 trillion company
- (4:43) What to expect from Fortescue Metals (ASX:FMG), Woolworths (ASX:WOW) & Afterpay (ASX:APT) next week
The Aussie share market is expected to gain 0.2% at the open, meaning the ASX200 could end slightly higher this week as it’s tracking 0.1% lower Monday to Thursday.
Overnight, U.S. weekly unemployment claims soared back to 1 million, this was far more than expected. Despite that, U.S. stocks bounced back from their prior day’s fall, with investors focused on maximising returns amid the record low interest rate environment.
What to watch today:
- Companies reporting: Alumina (ASX:AWC), BWX (ASX:BWX), Mayne Pharma Group (ASX:MYX), Suncorp Group (ASX:SUN), Healius (ASX:HLS), Inghams (ASX:ING) and Redbubble (ASX:RBL).
- In terms of economic news, we’ll get a preview of manufacturing and services data for August from CommBank, with both gauges expected to have eased as Victoria remains in hard lockdown.
Local trading ideas:
- UBS reiterated Tassal (ASX:TGR), Origin Energy (ASX:ORG) and Pro Medicus (ASX:PME) as a buy following their results yesterday.
- Bell Potter upgraded Pro Medicus (ASX:PME) from a hold to buy, with a price target of $28.50. Yesterday it fell 2.5% to $24.68 after delivering weaker than expected profit. However going forward, strong revenues and earnings are expected in FY21 as there are no other competitors in the medical streaming technology space and the company is continuing to invest $7m - $8m in R&D each year to maintain this tech advantage.
- Perpetual (ASX:PPT) delivered a 20% drop in profit yesterday in line with expectations. On the negatives, it didn’t flesh out details about its U.S. fund manager acquisitions and cost guidance is not clear. However on the positives, it’s expanding its high net worth (private client business). Bell Potter downgraded PPT’s price target to $43.80 but maintained its buy recommendation.
- The ASX (ASX:ASX) is showing that it’s formed a technical bullish uptrend, what’s known as an ‘upside break’ according to Trading Central’s charting. ASX is a UBS sell with a $75 target, it was also reiterated as a Citi sell.
Aussie futures are suggesting a retreat of 0.3%, which will trim some of yesterday’s gain of 0.7% and the week to date gain of 0.7%. The S&P500 scaled to a brand new record high, its second in two straight days before falling 0.4%. The Nasdaq met the same fate, scaling to a record before turning negative in the final few hours. Meanwhile, Apple became the first U.S. company to reach a market cap of $2 trillion, doubling its valuation in two years.
In commodities and FX, the U.S. dollar rose, which saw gold lose 1.6%, down to US$1,939. The oil price fell 0.2% to US$42.76. The Aussie dollar fell 1% and hit 71.85 US cents – falling from its fresh high.
What to watch:
• Afterpay (ASX:APT) upgraded its guidance levels expecting EBITDA to be $43 million, that’s almost double what APT previously expected.
Companies reporting today:
• Qantas (ASX:QAN) just reported its profit dived to a $2 billion after tax loss in 2020 financial year, a 334% fall on last year’s profit.
• Star Entertainment (ASX:SGR) just reported a full year net loss after tax of $95 million after falling 148%.
• Wesfarmers (ASX:WES) the owners of Bunnings, Kmart and Officeworks also just reported results
• Other companies which have reported include Perpetual (ASX:PPT), Domain (ASX:DHG), Medibank Private (ASX:MPL), and South32 (ASX:S32).
Trading ideas:
• Ingenia (ASX:INA) is showing that it’s formed a technical short-term bullish uptrend, according to Trading Central’s charting. Goldman Sachs backs INA as a buy with a $5.40 target.
• BHP (ASX:BHP) was reiterated as a UBS buy with a $40 target.
• ANZ (ASX:ANZ) was reiterated as a Bell Potter buy following its quarterly update, while its price target increased to $20.
In today’s morning bell, Jessica discusses:
- U.S. markets (0:24)
- Commodities and FX update – (1:19)
- All about Afterpay (ASX:APT) – (1:49)
- Companies reporting today: Qantas (ASX:QAN), Star Entertainment (ASX:SGR), Wesfarmers (ASX:WES), Perpetual (ASX:PPT), Domain (ASX:DHG), Medibank Private (ASX:MPL), and South32 (ASX:S32)– (2:57)
- Trading ideas: Ingenia (ASX:INA) – (4:14), BHP (ASX:BHP) - (4:38), ANZ (ASX:ANZ) (4:57)
Overnight U.S. stocks erased their COVID-19 losses, knocking the top off the previous record with the S&P500 rising 0.2%. This is following the U.S. Treasury Secretary saying Trump wants to move forward with more economic stimulus.
The fall of the U.S. dollar has helped the Aussie dollar gain 1% this week and overnight it hit 72.40 U.S. cents, its highest level since February last year.
The Federal Government inked a deal to produce a COVID-19 vaccine with AstraZeneca. We know CSL is already in talks with AstraZeeneca to develop the vaccine, so keep your eyes peeled on CSL (ASX:CSL).
Companies reporting today: CSL (ASX:CSL), Inovcare (ASX:IVC), Brambles (ASX:BXB), Amcor (ASX:AMC), Dominos Pizza (ASX:DMP), Tabcorp (ASX:TAH), Dexus (ASX:DXS), Stockland (ASX:SGP) and Vicinity Centres (ASX:VCX)
ANZ (ASX:ANZ) reported a strong rebound in the third quarter which was a stark differennce to Westpac (ASX:WBC) that reported yesterday.
Keep a watch on Treasury Wine Estates (ASX:TWE) and Orora (ASX:ORA), which are expecting further downside today. This is following the announcement of China's Ministry of Commerce kicking off an investigation into Australian businesses allegedly dumping wine at discounted prices.
Local trading ideas:
- Monadelphous' (ASX:MND) buy rating and price was upgraded after its results yesterday revealed it has a brighter future.
- Westpac (ASX:WBC) was maintained as a hold by Bell Potter, even though the bank scraped its final dividend.
- Australia’s largest miner, BHP (ASX:BHP) was maintained as a buy by UBS with a $40 price target.
The Aussie share market looks like it will attempt to erase some of yesterday’s 0.8% fall, with the futures suggesting a lift of 0.5% at the open.
Overnight the U.S. stocks ended mostly higher, with the NASDAQ hitting another new all-time high after rising 1%. Broad sentiment was high as U.S. homebuilder levels climbed to their highest points in 21 years, supported by record-low interest rates which boosted building demand.
What to watch today:
- On the economic front, the RBA meeting minutes will be released.
- Companies reporting: BHP (ASX:BHP), Coles (ASX:COL), Cochlear (ASX:COH) and Westpac (ASX:WBC).
- BHP (ASX:BHP) reported that its underlying attributable profit fell 1% to US$9.06 billion. At a first glance, it looks like that’s in line with Citi’s expectation, but weaker than what the market was expecting. Total dividends for the year fell from US$1.23 to US$1.20, including a US55¢ final dividend.
- Coles (ASX:COL) reported full year results with profit better than expected from continuing activities up 7% to $951 million.
- Westpac (ASX:WBC) cancelled its interim dividend and reported a quarter cash profit of $1.3 billion.
Local trading ideas:
- JB Hi-Fi (ASX:JBH) announced strong results yesterday but was downgraded by Bell Potter from a hold to a sell with a $44.00 target. Despite JB Hi-Fi and The Good Guys delivering double-digit sales growth on the back of COVID-19, the stock is now looking expensive at 20 times earnings, that’s why it was downgraded to a sell. Yesterday JBH rocketed up 4.9% to $49.60.
- Altium (ASX:ALU) also reported better than expected result yesterday. However, ALU did allude to slowing growth for the next five years, which is why Bell Potter reiterated ALU as a sell with a $31.25 target. Yesterday it rose 1.3% to $33.92.
- Imdex (ASX:IMD) earnings were in line with expectations, but net profit was below expectations due to higher depreciation costs. Bell Potter reiterated the stock as a hold and increased its price target to $1.38. Yesterday it gained 2.9% to $1.42.
The benchmark S&P/ASX200 looks set to start the week in the red with the futures suggesting a 0.95% drop at the open. This follows a reasonably underwhelming finish to the week on Wall Street, with stocks closing flat on Friday.
The Gold price fell 1% to US$1,949.80 an ounce on Friday night, this led to the precious metal having its worst week in almost six months.
What to watch this week:
- With the oil price falling, keep an eye on energy producers like Santos (ASX:STO) and Woodside Petroleum (ASX:WPL).
Companies reporting this week:
- The companies reporting today include, WAAAX stock Altium (ASX:ALU), Bendigo & Adelaide Bank (ASX:BEN) and oil and gas production company Beach Energy (ASX:BPT).
- Consumer goods retailer JB Hi-Fi (ASX:JBH) will be releasing its full year results, its share price will be on watch today following the release. Goldman Sachs analysts expect the retailer to report sales of $8.03 billion, this is compared to its guidance of $7.86 billion.
- Other companies reporting this week, include BHP (ASX:BHP), Coles (ASX:COL) and Westpac (ASX:WBC) tomorrow. On Wednesday, look out for the second biggest company on the ASX, CSL (CSL) who reports, and on Thursday, Wesfarmers (ASX:WES) reports.
Local trading ideas:
- On Friday, National Australia Bank (ASX:NAB) provided a limited 3Q 20 trading update. Bell Potter believes NAB has the foundations in place to cope with COVID-19. They forecast a final FY20 dividend of 20¢ and FY21 interim and final dividends of 40¢ each. Bell Potter’s price target remains at $19.90 price target and their Buy rating also remains unchanged.
- Bell Potter has increased investment management company Praemium’s (ASX:PPS) price target by 5% to 62 cents and maintains its Buy rating on the stock. Praemium reported last Friday. It’s FY20 EBITDA of $14.2m exceeded Bell Potter’s $13.8m estimate. Bell Potter believes PPS has delivered a good result in a difficult environment. Specifically, it is benefitting from increased investment in its Australian business. The company has gained scale and has a material merger with Powerwrap (ASX:PWL) if it is successful with its bid.
The Aussie share market rose 1.4% (Mon-Thu) however, momentum is slowing with investors focused on earnings and dividend growth for 2021.
In this week’s wrap, Jessica covers:
- (0:39) Employment rises more than expected in July. What's next?
- (1:13) The U.S. reports: S&P500 a shade off its record high
- (1:45) Aus earnings season: Banks to see declines & Miners to deliver
- (2:10) Reporting season wrap so far: CBA, Telstra & Transurban report
- (3:00) Stock watch: Treasury Wine Estates (ASX:TWE) guzzles up 18%
- (4:00) Mesoblast (ASX:MSB) falls Mon-Thu, then rockets after FDA vote
- (5:49) BHP (ASX:BHP), Coles (ASX:COL) and Westpac (ASX:WBC) all set to report next week
The Aussie share marked is eyeing a flat start to today’s session, after rising 1.4% Monday to Thursday. The lack of gas behind us today, comes as global markets closed mixed overnight, while U.S. futures are now suggesting a slight gain tonight.
In terms of economic news, we saw green shoots emerge in the U.S. showing its economy is clawing back. U.S. weekly job claims rose less than expected. What’s key is the number of those filing for benefits is now under 1 million for the first time since the pandemic started.
What to watch today:
- On the economic front, the RBA Governor will give a speech later today and New Home sales numbers are out for July.
- On the company news side, we mentioned Mesoblast (ASX:MSB) yesterday, well it’s back in focus today with the FDA advisory committee underway voting on MSB product’s efficacy in treating graft versus host disease in children with blood cancer, so keep an eye on the FDA’s vote due Friday 14th. MSB is a speculative buy for Bell Potter with a $6 target.
- Companies reporting today: Baby Bunting Group (ASX:BBN) and Adacel Technologies (ASX:ADA), both Bell Potter buys will report results. Other companies reporting including Newcrest Mining (ASX:NCM), Abacus Property Group (ASX:ABP) and Charter Hall Retail REIT (ASX:CQR).
Local trading ideas:
- Breville Group (ASX:BRG) was downgraded from a buy to a hold by Bell Potter with a $26.00 price target. UBS also downgraded BRG but expects its share price to continue to grow to $29.50. Breville has a strong balance sheet and is continuing to expand into Europe as planned. It also delivered a better than expected financial year result despite COVID-19.
- Macquarie downgraded AMP’s (ASX:AMP) price target to $1.30 following its financial results being handed down. While Bell Potter again went out on a limb, maintaining its buy rating and actually increased AMP’s price target to $2.60, expecting 70% share price growth.
The Aussie share market is set to gain 0.7% at the open, which should erase yesterday’s fall of 0.1%. Tech stocks on Wall Street rebounded rising 2.1%, with the S&P500 in striking distance of a record high. The UK market rose 2%, with the other major indices following. A big reason for this is global COVID-19 cases are continuing to fall.
What was notable in commodities was that the oil price jumped 2% to US$42.56, its highest level since early March after U.S. oil supply dropped.
What to watch today:
- Australian unemployment data is out for July, it is expected to worsen from 7.4% to 7.8% last month.
- Companies reporting today: AGL Energy (ASX:AGL), AMP (ASX:AMP), Breville (ASX:BRG), Evolution Mining (ASX:EVN), Goodman (ASX:GMG), Telstra (ASX:TLS), QBE (ASX:QBE), Treasury Wine (ASX:TWE) and Woodside Petroleum (ASX:WPL).
Local trading ideas:
- Mesoblast (ASX:MSB) was reiterated as a Bell Potter speculative buy with a $6.00 target.
- Bell Potter downgraded CBA (ASX:CBA) from a buy to a hold with a $78 target.
- WiseTech (ASX:WTC) was downgraded by Citi to a sell.
The Aussie share market is eyeing a rise for the third straight day, a lift of 0.2%, after the ASX200 hit a two-month high yesterday.
Russia has claimed it has given regulatory approval for the world’s first COVID-19 vaccine. This news saw gold fall 5% to US$1,931, with silver falling 13% and copper down 0.8%. So the odds are stacked, gold stocks expected to fall with heavy weights likely to see some profit taking too.
Overnight, the broad U.S. indices stocks fell into negative territory in the final hours of trade with the S&P500 losing 0.8%, ending 7-days of gains, but still holding onto its yearly gain, while the Nasdaq underperformed, down 1.7%
Companies reporting today:
- Commonwealth Bank of Australia (ASX:CBA) - reported a 12.4% increase in its statutory profit to $9.6 billion.
- Transurban (ASX:TCL) reported a loss of $153 million.
- Computershare (ASX:CPU)
- Magellan (ASX:MFG)
- Mineral Resources (ASX:MIN)
- Seek (ASX:SEK) reported full year results with revenue weaker than expected, which UBS reiterated as a buy.
Local trading Ideas:
- Ramsay (ASX:RHC) is showing a strong bullish uptrend and is likely to rally along with Australian Pharmaceuticals (ASX:API) and Arena REIT (ASX:ARE), all according Trading Central’s charting and standard technical analysis.
The Aussie share market put on a show yesterday rising 1.8% to a three-week high, and today the futures suggest the market will see a flat start, falling 0.05% at the open.
What to watch today:
- The RBA minutes will be released, which should reveal the details of how much money the central bank injected into the financial system, when the RBA purchased the Australian Government Securities earlier in August. The RBA did that to provide the government with capital and to also drop the bond yield to its target of 0.25%.
Companies reporting today:
- Challenger (ASX:CGF)
- Coronado Global Resources (ASX:CRN)
- James Hardie Industries (ASX:JHX)
- Janison Education (ASX:JAN)
- Shopping Centres Australasia Property Group (ASX:SCP)
Local trading ideas:
- Footwear business Accent Group (ASX:AX1) is showing a bullish uptrend according to Trading Central’s charting. Their chart suggests the stock could rise from yesterday’s close of $1.35 to $1.68 - $1.76 over 31 days. It’s a Bell Potter buy with a $1.80 price target.
- Bell Potter upgraded mining equipment business Mader Group's (ASX:MAD) buy rating and target to $1.22, implying a 42% share price growth from yesterday’s close price on the back of growth in the iron ore and gold industries.
- Following Aurizon Holdings (ASX:AZJ) providing its financial results, Citi has reiterated the stock as a buy, but it dropped AZJ’s target to $5.15 due to a lack of transparency in the outlook for coal.
The Aussie share market is eyeing a lift of 0.7% at the open after global equities ended mostly on positive ground on Friday, as the U.S. reported early signs of an economic recovery.
The U.S. economy added 1.8 million jobs in July, smashing through expectations that only 1.4 million people gained a job. Meanwhile, traders and investors looked past the lack of fresh economic stimulus, with the White House and Democratic party not yet being able to agree on a new weekly payment to replace the $600 per week federal unemployment benefit that expired at the end of July.
Companies reporting today:
- Aurizon Holdings (ASX:AZJ) reported a 28% jump in its net profit after tax in the full year and also launched a $300 million buy back to return equity to shareholders.
- GPT Group (ASX:GPT) handed down their results, reporting a $519.1 million loss for the first half of the year, with its retail property valuations falling 10.5% as at 30 June.
- James Hardie Industries (ASX:JHX) reports their financial results today.
Local trading ideas:
- Flight Centre Travel (ASX:FLT) is showing a bullish signal according to Trading Central’s charting. On Friday, Flight Centre closed 6.3% up at $10.63 and Trading Central believes FLT’s share price may rise to between $12.70 - $13.20 in 25 days according to standard principles of technical analysis.
- UBS reiterated Insurance Australia Group (ASX:IAG) as a buy with a $6.10 price target. Despite IAG's outlook being impacted by headwinds, UBS sees value in IAG. FY21 will be a tough year for underlying profits, with recovery on the horizon post COVID-19. That’s where IAG should have greater ability to restore profit growth, through stronger repricing. So that’s IAG a UBS Buy.
The Aussie share market is set to open flat this morning, following U.S. shares shaking off a slow start with the Nasdaq finishing above 11,000 for the first time in history.
The RBA statement on Monetary policy will be released at 11:30am today and the China trade balance for July will also be released. Tonight, U.S. July nonfarm payrolls will be released, which will shine further light on the employment situation in the U.S..
Gold extended its record rally for the fifth day in a row, with more indecision from U.S. lawmakers regarding a second COVID-19 stimulus package combined with a soft U.S. dollar, continued to support gold moving towards the US$2,100 mark.
Companies reporting today:
- Charter Hall Long Wale REIT (ASX:CLW)
- Insurance Australia Group (ASX:IAG)
Bell Potter Trading ideas:
- Life360 (ASX:360) is rated as a Buy by Bell Potter, yesterday the stock closed at $3.90, rising 8% from Wednesday.
- Looking at the small cap Agricultural REIT Vital Harvest (ASX:VTH), it is rated by Bell Potter as a buy. It recently provided second half distribution guidance of 1.5c, exceeding the Bell Potter forecast of 1.25c, putting this company on a historical cash yield of over 6% based on yesterdays close of $0.79c.
Aussie equities are eyeing a 0.5% lift at the open, following a positive session overnight. We saw U.S. stocks rise on the back of Disney revealing it has 100 million streaming subscribers and COVID-19 vaccine hopes.
Medical device company, Johnson & Johnson have struck up a $1 billion deal with the U.S. government to manufacture 100 million doses of its COVID-19 vaccine candidate, if it proves successful. Following this news, its share price rose 0.8%.
What to watch today:
- ResMed (ASX:RMD), they announced their fourth quarter fiscal 2020 earnings today. The highlights included a revenue increase of 9% to $770.3m and a net operating profit increase of 84% compared to the prior year period. The strong result is largely due to strong ventilator demand during the period.
- Energy producers, like Beach Energy (ASX:BPT) and Woodside Petroleum (ASX:WPL) could push higher today following the lift in the oil price. Both stocks closed 0.7% lower yesterday.
- And with the gold price once again hitting a new record overnight, up 1.5% to US$2,053 an ounce, keep an eye on gold miners like Northern Star Resources (ASX:NST) and Saracen Mineral Holdings (ASX:SAR).
Local trading ideas:
- Centuria Capital Group (ASX:CNI) is showing a bullish signal according to Trading Central’s charting. Yesterday, Centuria closed 5.5% up at $1.83 and Trading Central believes the stock’s share price may rise to between $1.89 - $1.93 in 24 days according to standard principles of technical analysis.
- Fortescue Metals Group (ASX:FMG), Bell Potter has lifted FMG’s price target by 17% to $12.50, but have lowered their recommendation of the stock from a Hold to a Sell following strong share price appreciation. A near term catalyst for FMG includes the release of its FY20 financial results and declaration of its final FY20 dividend on the 24th of August. The stock goes ex-dividend likely in early September.
The Aussie share market is eyeing a fall of 0.6% at the open, as traders bid up stocks in global markets on the hope of a second Federal Reserve stimulus package.
The major exchanges in the U.S. all pushed higher overnight with the S&P500 up 0.36%, it is now less than 3% off its pre-pandemic record highs in February this year.
Companies reporting today:
- ALE Property Group (ASX:LEP) reports its full year results today.
Local trading ideas:
- The Funeral Services Provider Invocare (ASX:IVC) is rated by Bell Potter as a buy. As a market leader in the sector, Invocare has faced significant headwinds from COVID-19 related gathering restrictions. IVC reports its H1 2020 results on the 19th of August. Its major competitor, Propel Funeral Partners (ASX:PFP) provided the market with a trading update back in May, which showed an increase in their average revenue of 8%. Invocare has been sold off heavily since stage 4 COVID-19 restrictions have come into place in Victoria and is now trading at a near 7 year low.
- Life360 (ASX:360) is a mobile app in the U.S. and is available internationally. The midcap is rated as a buy by Bell Potter. Like Afterpay (ASX:APT), 360 has strong network effect characteristics, which is why Bell Potter expects the next catalyst for the stock will be when Life360 reports on August 20.
The Australian share market looks set to rise 1.4% at the open, marking the second trading day for August.
Overnight Microsoft shares lifted 5.6% to a brand-new record high, supported by U.S. President Trump calling on Microsoft to buy TikTok.
What to watch today:
- The RBA will meet today with rates expected to remain on hold at 0.25%. While the focus will be on further bond buying and if that will kick off again, particularly as Victorian COVID-19 restrictions tightened to level 4 with a curfew in place.
- The Federal Government will introduce a $1,500 payment to workers in Victoria who are required to self-isolate.
Companies reporting today:
- BWP Trust (ASX:BWP)
Local trading ideas:
- Bell Potter reiterated Tabcorp Holdings (ASX:TAH) as a buy following its solid FY20 result. Its shares are up 61% from the COVID-19 low.
- Magellan Financial Group (ASX:MFG) was reiterated as a UBS hold, with a target price of $56.70. Yesterday MFG closed 0.3% higher at $61.16. Despite growing its inflows, UBS says maintaining inflows is becoming increasingly capital intensive as its business enters a more mature growth phase.
- Cleanaway Waste Management (ASX:CWY) is showing a bullish uptrend according to Trading Central’s data. Its chart is showing a bullish signal, ‘by an inside bar’ chart, suggesting CWY’s stock price may rise from the close of $2.12. UBS has the stock as a hold with a $2.15 target.
The Aussie share market is set to open flat this morning with a fall of 0.2% expected at the open, this comes despite a positive end on Wall Street on Friday.
Across the ocean, European stocks posted their first monthly drop since March amid fears of a second COVID-19 wave.
What to watch today:
- With Victoria declaring a ‘State of Disaster’ after a spike in COVID-19 cases, keep an eye on the stocks that are likely to be impacted. For example, Coles (ASX:COL) could see a lift today following reports of panic buying, while on the flipside Crown Resorts (ASX:CWN) could come under pressure, given its Melbourne casinos and hotels are unlikely to re-open until mid-September.
- Keep an eye on energy producers including Santos (ASX:STO) and Woodside Petroleum (ASX:WPL), following the oil price jumping higher.
- At one point on Friday night, we saw the gold price break above US$2,000 an ounce for the first time on record. Keep an eye on gold miners like Newcrest Mining (ASX:NCM) and Northern Star Resources (ASX:NST) today.
Companies reporting this week:
- On Tuesday, BWP Trust (ASX:BWP) reports.
- On Wednesday, Resmed (ASX:RMD) and ALE Property Group (ASX:LEP).
- On Friday, Insurance Australia Group (ASX:IAG) reports .
Local trading ideas:
- Following Nickel Mines (ASX:NIC) releasing its June 2020 quarter report, Bell Potter has Nickel Mines as its top pick in the Diversified Metals & Mining sector. Bell Potter maintains its Buy rating on the stock and has a price target of $1.07.
- Analysts at Goldman Sachs believe Goodman Group’s (ASX:GMG) share price is overvalued and the broker has a sell rating on the stock. GMG shares closed 0.5% lower on Friday to $16.93. Goldman Sachs however has a price target of $11.25 on the property company’s shares. It believes the market is pricing in an unrealistic earnings per share growth rate of ~9% per annum between FY 2020 and FY 2024. They believe a growth rate of 6% per annum is more realistic.
The Aussie share market rose for the 4th month, up 33% from its COVID-19 low. We saw Australia slip into deflation, while on the commodity front, all that glittered was gold.
In this week’s wrap, Jessica covers:
- (0:16) Star stocks: ALS (ASX:ALQ) +34% & Orocobre (ASX:ORE) +33%
- (0:45) Stocks to consider as the gold price glistens
- (1:55) Inflation hits rock bottom - biggest fall in history
- (2:25) Rent takes a plunge: also a historical record
- (2:56) Inflation rebound themes to consider: childcare & fuel/oil
- (3:57) Rio Tinto (ASX:RIO) & Fortescue Metals (ASX:FMG) results
- (5:30) Next week: Resmed (ASX:RMD) reports, RBA meets
- (6:17) Retail stocks to watch: Temple & Webster (ASX:TPW), Michael Hill (ASX:MHJ) & Harvey Norman (ASX:HVN)
The Aussie share market is eyeing a fall of 0.5% at the open, following a mixed session on overnight markets with the Dow falling 0.9%, the S&P500 down 0.4%, while the Nasdaq pumped up 0.4%. But what’s noteworthy is the Nasdaq futures are suggesting a 1% gain on Friday. So in afterhours trade, the ETF tracking the Nasdaq 100 (QQQ) rose 1% and the ETF tracking the S&P500 (SPY) rose 0.9%. So keep an eye on their Aussie counterparts today, the ETF on the ASX that tracks the Nasdaq 100 is (ASX:NDQ).
Overnight, the U.S. officially entered a recession with second quarter GDP falling 32.9%, following the 5% drop in Q1. The fall was not as bad as the expected 34.1% drop however, it was the worst fall in history. This saw people reshuffle their portfolios, chasing companies upgrading their earnings.
What else to watch today:
- On the economic side, private sector borrowing known as private sector credit is out today.
Local trading ideas:
- Bell Potter reiterated CBA (ASX:CBA) as a buy with a price target of $78.00, implying 7% share price growth from yesterday’s close price of $73.01.
- Janus Henderson (ASX:JHG) delivered a solid June quarter update, Bell Potter reiterated JHG’s buy rating and increased its target to $42.50. That implies 36% growth from yesterday’s close of $31.21. Bell Potter also upgraded its earnings per share estimates by 2-3% with June quarter profit hitting US$104.1 million, smashing through expectations.
- Following IOOF Holdings’ (ASX:IFL) disappointing quarterly report that raised a number of issues that were not properly addressed in the update, Bell Potter reiterated IOOF as a sell, dropping its target price to $4.20.
The Aussie share market is eyeing a gain of 0.9% at the open, following a positive night for U.S. equities and commodities.
Overnight in the U.S., the Federal Reserve kept interest rates on hold at 0.25% as most expected.
Companies reporting today:
- CIMIC (ASX:CIM) – half year results
- Fortescue Metals (ASX:FMG) – quarterly production
What to watch today:
- Rio Tinto (ASX:RIO) reported half year results after market close yesterday with its earnings dropping less than UBS expected.
- Macquarie (ASX:MQG) holds its AGM today.
- Building permits are out for June, expected to recover from -16% and show a rise of 1.5%. So watch building supplies companies like CSR (ASX:CSR) and Brickworks (ASX:BKW).
- In the U.S. tonight, we’ll learn how much the economy fell in the second quarter, with growth estimated to fall from -5% in Q1 to -34.1% in Q2.
Local trading ideas:
- Bell Potter upgraded family tracking and safety app, Life 360’s (ASX:360) buy rating and price target to $5.20, implying 60% share price growth from yesterday’s close price of $7.99. This month its shares recovered from its COVID-19 losses after gaining 59%. Life360 delivered maiden positive quarterly cash flows, a US$6.9 million turnaround due to tight cost controls and resilient subscription numbers during the lockdowns.
- Bell Potter also upgraded Aussie car dealership giant, A.P Eagers’ (ASX:APE) buy rating and price target to $9.00, implying 13% share price growth from yesterday’s close price of $33.61. APE held its AGM yesterday, announcing first half profit before tax of $40.3 million, which was stronger than expectations. Its corporate debt was $7.6 million, far less than expected, emphasising APE’s strong management.
- Following APRA’s capital management guidance released yesterday, easing restrictions around paying dividends, Bell Potter reiterated ANZ (ASX:ANZ), CBA (ASX:CBA) and NAB (ASX:NAB) as buys, reiterating holds for Westpac (ASX:WBC), Bendigo & Adelaide Bank (ASX:BEN) and Bank of Queensland (ASX:BOQ).
The Aussie share market is eyeing a fall of 0.4% at the open. U.S. equities fell back into the red overnight with lawmakers debating the COVID-19 relief plan that was partly unveiled yesterday.
Companies reporting today:
- Rio Tinto (ASX:RIO) – expect results after market close
- Unibail-Rodamco-Westfield (ASX:URW)
- Independence Group (ASX:IGO) – quarterly production
- Janus Henderson (ASX:JHG) – quarterly earnings
What to watch today:
- For an economic pulse check, we’ll learn what Aussie inflation is at. Inflation is expected to fall from 2.2% to -0.4% in Q2 on a year-on-year basis, reflecting zero wage growth in the private sector and pay cuts in the public sector.
Local trading ideas:
- Bell Potter upgraded betting company PointsBet’s (ASX:PBH) speculative buy rating and price target to $7.60, implying 31% share price growth from yesterday’s close price of $5.80. Yesterday it fell almost 8% but is tracking 18% higher this year. With TAB outlets being closed and limited access to pokies, PBH has a bullish outlook. PBH recently received a permit to operate in Illinois, which will add to its newly created programs in Michigan, Indiana and New Jersey. PBH is a buy, but is classed as speculative given it is making a loss.
- Bell Potter upgraded Temple & Webster’s (ASX:TPW) buy rating and price target to $9.70, implying 18% share price growth from yesterday’s close price of $33.61. Yesterday TPW charged almost 6% higher after it announced full-year revenue jumped 74%.
- Bell Potter upgraded Virgin Money UK (ASX:VUK) from a hold to a buy, increasing its target to $2, implying 13% share price growth from yesterday’s close at $1.77.
The Aussie share market is set to gain 0.4% at the open, a nice addition to yesterday’s 0.3% gain.
It was another action-packed night with the gold price continuing to climb, U.S. equities clawing back and the Republican party unveiling parts to their COVID-19 relief plan, including a 70% wage replacement of sorts.
Companies reporting today:
- Credit Corp (ASX:CCP) - Full year
- G.U.D Holdings (ASX:GUD) - Full year
- Iluka Resources (ASX:ILU) - 2Q20 Prod
Local trading ideas:
- Bell Potter upgraded Emeco Holdings’ (ASX:EHL) buy rating and price target to $1.60, implying 62% share price growth from yesterday’s close price of $0.99. The bullish outlook comes as EHL reported solid FY20 results in line with expectations, with profit up 23%. EHL also unveiled a stronger than expected FY21 outlook for earnings.
- Bell Potter upgraded fund manager Perpetual’s (ASX:PPT) buy rating and price target to $45.00, implying 32% share price growth from its last close at $33.61. It comes as PPT announced the 75% purchase of U.S. based fund manager who manages US$44 billion.
- Ahead of Rio Tinto (ASX:RIO) releasing their results tomorrow, UBS reiterated its hold rating and price target of $102 for RIO, implying its shares will fall from yesterday’s close of $102.89. UBS says with commodity prices being slower, earnings are tipped to fall 6% to US$4.6 billion.
- Following HUB24’s (ASX:HUB) fourth quarter trading update, Citi maintained its buy rating and $14.40 target for the stock.
The Aussie share market is eyeing a fall 0.5% at the open, following a red finish in the U.S. on Friday.
Gold prices hit brand new record highs of US$1,898, on the back of US-China tensions and lingering COVID-19 fears.
What to watch this week:
- The RBA Assistant Governor is speaking via webinar at 10am. Catch that on the RBA’s website.
- Australian inflation data will be released on Wednesday.
- U.S. GDP data will be released on Thursday.
- This week will be a really telling week for markets with Apple, Amazon and Facebook reporting results which will need to justify their record high valuations.
Reporting season:
- Credit Corp (ASX:CCP) on Tuesday.
- Rio (ASX:RIO) on Wednesday.
Trading ideas:
- After Mineral Resources (ASX:MIN) shares rose about 47% this year, seeing minimal COVID-19 impacts and increasing its iron ore shipment by 53% in the year, Bell Potter downgraded the company from a buy to a hold, following its outperformance. However, Bell Potter also said there is uncertainty in the iron ore price, as well the increased tension with US/China that could weigh on Mineral Resources.
- UBS increased Insurance Australia’s (ASX:IAG) buy rating and price target to $6.50 with UBS being bullish on insurance premium rates. However, UBS downgraded IAG’s earnings for FY21E by -15%.
- Citi reiterated Aristocrat Leisure (ASX:ALL) as a buy with a $30 target.
- Citi picked Austal (ASX:ASB) as its key buy in the small caps with a $4.23 target.
The rocky road continues with the Aussie share market on the up, but hitting bumps along the way. With COVID-19 still a concern both domestically and in key international markets, strategic investing continues to be critical.
In this week’s wrap, Jessica covers:
- (0:11) Two steps forward, one step back - the Aussie share market hits a 4-week high before falling back
- (1:16) Stocks on watch: Resolute Mining (ASX:RSG) up 20%, while TPG Telecom (ASX:TPG) falls 10% amid roaming data losses
- (1:44) Macro outlook: COVID-19's impact on the Australian economy
- (2:30) What the stimulus package means for the economy
- (3:20) Taking advantage of the gold rush
- (4:48) Working At Home trading ideas: Tesserent (ASX:TNT), Vocus (ASX:VOC) and Wesfarmers (ASX:WES)
The Aussie share market is eyeing a 0.9% fall at the open, following a volatile session overnight in the U.S. after the release of disappointing unemployment data.
U.S. weekly jobless claims came in at 1.4 million for last week, which marks the 18th straight week that initial claims totalled more than 1 million.
The Oil price fell 2.1% to US$41.03 a barrel. Given this, we can expect Energy producers like Oil Search (ASX:OSH) and Woodside Petroleum (ASX:WPL) to come under pressure today. Traders were selling oil amid concerns that further spikes in COVID-19 cases could hurt demand.
What to watch today:
- With the tech-heavy Nasdaq index tumbling overnight, keep an eye on Australian tech shares, such as Altium (ASX:ALU) and Appen (ASX:APX), as Australia’s leading tech shares have a tendency to follow the lead of their U.S. counterparts.
- Gold miners including Evolution Mining (ASX:EVN) and Newcrest Mining (ASX:NCM) could be on the rise again today after the gold price surged higher on the back of stimulus hopes.
- Mining services company, Mineral Resources (ASX:MIN) is due to report production numbers for the fourth quarter. Mineral Resources closed yesterday 1.1% lower to $24.52, so keep an eye on that stock today.
- Gold mining company, OceanaGold (ASX:OGC) is due to report production numbers for the second quarter.
Local trading ideas:
- Consumer goods retailer, JB Hi-Fi (ASX:JBH) is showing a bullish signal according to Trading Central’s charting. Yesterday JB Hi-Fi closed 2.5% higher at $44.27, but Trading Central says it could hit between $49.25 to $50.50 in 30 days according to standard technical analysis.
- Goldman Sachs believes the recent weakness in CSL’s (ASX:CSL) share price could be a buying opportunity for the stock. Goldman Sachs retains its buy rating for the stock and has a price target of $326. After doing a deep-dive on plasma collections, it doesn’t believe there is anything to worry about for the biotherapeutics company.
The Aussie share market is eyeing a 0.1% lift at the open, bracing for the Government’s mid-year Economic and Fiscal update with estimates suggesting debt swelled to 9% of GDP. Investors are also weighing up a positive finish on Wall Street, while Europe closed lower with oil stocks leading the decline.
In the U.S., the Government agreed to pay Pfizer and BioNTech $1.95 billion to produce 100 million COVID-19 vaccines if their candidate is safe and effective. Washington is considering extending the COVID-19 unemployment benefit from September to December, and dropping it to $400 a week.
On the commodities front, Oil fell slightly to US$41.90, maintaining its March high. The Gold price gained 1.3% to US$1,865, its highest level since September 2011 and Silver hit a near 7-year high.
What to watch today:
- The Aussie dollar holds its 15-month high with the USD.
- Quarterly results are due out today for Evolution Mining (ASX:EVN), Galaxy Resources (ASX:GXY), Newcrest Mining (ASX:NCM), Northern Star Resources (ASX:NST), Santos (ASX:STO), Syrah Resources (ASX:SYR) and Megaport (ASX:MP1).
- Face masks are compulsory in Victoria as of midnight last night.
Local trading ideas:
- After Lynas (ASX:LYC) handed down its quarterly report, UBS reiterated Lynas as a buy, increasing its target to $2.70. Yesterday LYC closed 2.4% lower at $2.08, but they are still tracking 92% up from their COVID-19 bottom. UBS cut EPS estimates for FY21 due to weaker demand in the automotive industry.
- OZ Minerals (ASX:OZL) handed down its quarterly results yesterday and UBS reiterated OZ Minerals as a buy, increasing its price target to $15.00. Yesterday OZL shares gained 4.2% to $4.24 and have gained 28% so far this year. UBS thinks there is more upside following yesterday’s better than expected results.
The Aussie share market is eyeing a 1% fall at the open, following the 2.6% gain yesterday on the ASX which took the market to its highest level since the 6th of March. The Aussie futures are pointing to a dreary open despite European equities hitting four-month highs and U.S. equities mostly pushing higher.
Across the ocean, the European Union agreed to the 750 billion Euro recovery package.
What to watch today:
- OZ Minerals (ASX:OZL) is due to report production numbers for the second quarter.
- Washington lawmakers are coming under pressure to extend the $600 per week federal unemployment benefit ending at the end of September.
Local trading ideas:
- Bell Potter reiterated Suncorp Group (ASX:SUN) as a buy with a $10.50 price target. Yesterday Suncorp Group closed 2.1% higher at $9.24. In terms of COVID-19 impacts, Suncorp expects these to be broadly neutral on FY20.
- After BHP (ASX:BHP) handed down its quarterly report, UBS reiterated BHP as a buy with a $40 target. Yesterday BHP closed 1.1% up at $38.80. Overall with lower guidance for FY21 results, UBS forecast a 6% reduction in underlying earnings.
- Footwear business Accent Group (ASX:AX1) is showing a bullish signal according to Trading Central’s charting. Accent Group is backed by Bell Potter as a buy with a $1.80 target given its online sales grew 150% from April to June.
The Aussie share market is eyeing a 0.7% lift at the open, following a positive night in the U.S. on hopes of further economic stimulus there.
Across the ocean, UK’s Oxford University with AstraZeneca reported a strong immune response in a large early-stage human trial, according to medical journal The Lancet.
What to watch today:
- The RBA Governor will give a speech later today and the RBA minutes will be released.
- The Government is expected to announce that JobKeeper and JobSeeker payments have been extended for another six months, but both payments will be reduced as the Government has found they could act as disincentives to work as the economy recovery. This is on top of the new $2 billion job package that was announced to help the unemployed and school-leavers. So stay tuned to the Prime Minister and Treasurer’s announcements.
- Quarterly results today are due out for BHP (ASX:BHP) and Oil Search (ASX:OSH).
Local trading ideas:
- Following South32’s (ASX:S32) quarterly results being handed down, UBS reiterated the stock as a buy with a with a $2.60 target following yesterday’s close of 2.3% lower at $2.17. South32 ended FY20 better than expected, with yearly production records set by Brazil Alumina, Hillside Aluminium and Australian Manganese.
- Fleet leasing business Eclipx Group (ASX:ECX) had a cracking day on the ASX yesterday up 7.3% to $1.40 after announcing the sale of Right to Drive for up $26.5 million, to be completed on 17 August 2020. UBS reaffirms Eclipx Group as a key buy with a $1.45 target, with upside to earnings.
- Bell Potter upgraded Catapult Group (ASX:CAT), a wearable software athlete tracker company, with a $1.50 target. Yesterday it closed 11.4% higher at $1.42 after delivering FY20 earnings stronger than expected, also generating free cashflow of $9 million which was well ahead of the estimated $100,000.
Aussie shares are set for a flat start this week, following a mixed session on Wall Street last Friday, where the Nasdaq and S&P500 rose 0.3% each, while the Dow fell 0.2%.
With NSW eyeing another lockdown and Victoria in the thick of theirs, attention this week will be turned to Federal economic stimulus. We know the government plans to increase its support to small and medium businesses, giving access to cheap and part-guaranteed loans of $1 million from 1 October, an increase from $250,000.
What to watch this week:
- The RBA Governor on Tuesday will give a speech, and you’d expect bond buying or quantitative easing to be brought up.
- Thursday's economic statement - revealing record debt and huge deficit forecasts, driven by massive increases in spending, and falls in revenue. We’ll also get details of the further economic stimulus.
Trading ideas:
- A.P. Eagers (ASX:APE) - UBS initiated coverage of the automotive retailer, giving it a buy rating and price target of $7.90. On Friday it closed 0.5% up at $6.19. APE is the largest dealership group in Australia (with over 11% of new car market share) offering new and used vehicles, servicing, spare parts and financing service.
- Integrated Research (ASX:IRI) - Bell Potter has downgraded the software provider from a buy to a hold with a $4.25 target. On Friday it rose 4.4% to $4.00, and it’s collectively gained about 20% this year. Bell Potter forecasts high single digit percentage growth in revenue and low double digit percentage growth in NPAT in both FY21 and FY22.
- Service Stream (ASX:SSM) - Bell Potter also downgraded the engineering infrastructure company from a buy to a hold with a $2.05 target. On Friday it closed 1.3% lower at $1.86. Bell Potter expects there to be about 9% upside in the stock but then expects things could dampen due to operational pressures from COVID-19 restrictions.
With COVID-19 changing our daily behaviour, several rebalancing and trading opportunities have surfaced. Add in the six key economic indicator and commodity price movements this week - and there's plenty for investors to consider. In this week’s wrap, Jessica covers:
- (1:59) Three stocks benefiting from the economic recovery
- (2:15) Recessionary outperformers slump: Avita Therapeutics down 15%
- (2:35) Where to consider increasing exposure to in light of the recent $2 billion jobs package
- (3:08) As OPEC eyes a production lift in August, the oil price braces for heightened volatility
- (3:26) Reading the new market: rebalancing ideas for your portfolio
- (4:24) Strategic trading ideas: Collins Foods (ASX:CKF), Coles (ASX:COL) and Super Retail Group (ASX:SUL)
The Aussie share market is eyeing a 0.3% lift at the open.
Yesterday we had mostly encouraging economic news with the Aussie employment rate rising more than expected.
U.S. industrial and manufacturing activity beat expectations, but overnight U.S. weekly unemployment claims unexpectedly rose, spooking investors and giving them an excuse to take recent profits off the table.
Trading ideas:
- UBS increased Audinate’s (ASX:AD8) buy rating and price target to $7.80, yesterday it closed 1.5% lower at $5.30. This doesn’t take away from its 118% gain from the COVID-19 low.
- Ahead of CBA’s (ASX:CBA) full financial year results being released on Wednesday 12 August, Bell Potter rose CBA’s price target to $78.00, yesterday it closed 0.1% lower to $72.64. CBA shares are up 34% from their COVID-19 bottom.
- Life 360 (ASX:360) had its buy rating and price target upgraded by Bell Potter to $4.80. Yesterday it closed 5.2% higher at $3.03, giving it a total gain of 89% from its COVID-19 low.
The Aussie share market is eyeing a 0.3% lift at the open, which will be a nice addition to this week’s 2.3% gain.
Following better than expected economic news, industrial production rose 5.4% in June quarter, much more than expected, spelling its biggest rise since 1959. Meanwhile New York manufacturing numbers came out, also much stronger than expected, showing the biggest gain since 2018. All of this supports the V-shape economic recovery.
What to watch today:
- It’s Aussie employment data day. 113,000 jobs are expected to be added in June, which could mark an encouraging recovery from the 228,000 jobs lost in May. On the flip side, the unemployment rate is also expected to rise to 7.4%.
- Later this evening U.S. retail sales data is out, which is expected to rise again.
Trading ideas:
- UBS increased Woodside Petroleum's (ASX:WPL) buy rating and price target to $27.00, seeing upside in its multi-billion dollar growth projects. Yesterday Woodside announced second quarter revenue fell 30% due to LNG prices, that was weaker than expected, which is why it’s shares fell 2.2% to $20.96.
- Bell Potter rose Afterpay’s (ASX:APT) price target to $83.00. APT confirmed its services will now be available in Apple Pay and Google Pay wallets.
- Bell Potter reiterated Senex Energy (ASX:SXY) as a buy, increasing its target to $0.35.
The Aussie share market is expected to rise 0.5% at the open, after U.S. equities throttled ahead on COVID-19 vaccine hopes.
After market close Biotech giant Moderna announced its potential COVID-19 vaccine produced a strong immune response, neutralizing antibodies in all of the 45 patients in its early stage human trial. The U.S. futures are now suggesting a 0.9% rally when trade resumes this evening. That’s red hot news for Aussie investors, who closely follow what U.S. futures are doing as a sentiment indicator. So you could expect Aussie eco recovery stocks to follow Wall Street’s lead.
What to watch today:
Today consumer confidence data is out following better than expected NAB business confidence numbers out yesterday. Will confidence return to positivity and rise more than expected given the government cash handouts and superannuation withdrawals?
Trading ideas:
- Bell Potter upgraded Whitehaven Coal's (ASX:WHC) price target to $2.30, implying 51% growth, after the company delivered record results and that it will meet its production & sales guidance this year. UBS also reiterated it as a buy and increased its price target to $2.70.
- According to Trading Central's charts, AMA Group (ASX:AMA) is on a bullish uptrend, and it is also supported by fundamental research. Bell Potter backs the vehicle repair and accessory business AMA as a buy, recently increasing its price target to $0.85 after the company negotiated its service agreements with IAG and Suncorp.
- Looking at Trading Central's charts, Michael Hill's (ASX:MHJ) shares are suggested to be in a bullish uptrend. MHJ is also supported by fundamental research by Citi, which backs the jeweller as a buy with a $0.45 target.
The ASX200 is set to fall 0.8% at the open, trimming off some of yesterday’s 1% gain after U.S. equities turned positive for the year. The S&P500 hit its highest level since COVID-19 began before falling and losing those gains.
What to watch today:
- Whitehaven Coal (ASX:WHC) releases Q2 2020 production.
- NAB business confidence for June is out today with forecast to improve from May’s reading of negative 20 given payrolls in May and retail spending is recovering. Keep a close eye on stocks linked to the economic recovery like the big four banks, Suncorp (ASX:SUN), Auswide Bank (ASX:ABA), Goodman Group (ASX:GMG) & Centuria (CIP).
- NSW will cap the number of people allowed in pubs following an outbreak at the Crossroads hotel. This won’t affect the Clubs or Star City Casinos (ASX:SGR). Keep an eye on the biggest owner of pub properties ALE Properties (ASX:LEP).
- Westpac (ASX:WBC) names Michael Rowland as its new CFO, joining from KPMG.
Local trading ideas:
- UBS reiterated Oil Search (ASX:OSH) as a buy with a $4.30 price target.
- Bell Potter increased its buy rating and price target of Praemium (ASX:PPS) to $0.59 expecting a stellar FY22 on the back of an EPS lift.
- UBS reiterated Qantas (ASX:QAN) as a buy with a $4.60 price target, expecting an improvement in numbers from September. But keep in mind flights in and out of Melbourne represent 21% of Australian capacity and international flights are on hold. Given this, expect earnings to return in 2022.
The Aussie share market is eyeing a 1.6% gain at the open, which will help us recoup some of the 2.3% lost last week.
Millions of Australians will receive a second $750 payment from today, with the one-off cash payment going to eligible pensioners, carers and students, which will cost the government over $4 billion. Free childcare ends today after three months, while some parents will receive 100 hours per fortnight subsidised until October 4.
Despite COVID-19 cases in the U.S. rising to a record high, U.S. stocks charged ahead on Friday after Gilead reported its COVID-19 treatment candidate showed an improvement in clinical recovery and 62% reduction in the mortality rate compared to the level of care.
What to watch today:
- Expect stocks linked to the economic recovery to attempt a slight claw back following Wall Street’s lead.
- Tomorrow NAB (ASX:NAB) will report its business confidence for June, Consumer confidence data is out on Wednesday and unemployment data is out on Thursday with consensus expecting unemployment will lift from 7.1% to 7.4%, less than the RBA’s forecast of 10%. If data is better than expected, expect the market to rally along with banks and consumer discretionary stocks.
Local Trading ideas:
- UBS reiterated Nine Entertainment (ASX:NEC) as a buy with a $1.70 target, after the CFO announced his resignation after a family member passed away. At the same time, Nine announced its full year earnings (EBITDA) for FY20 should be $390-$410 million beating UBS’ expectations.
- Bell Potter increased its buy rating and price target of NAB (ASX:NAB) to $19.90.
- Bell Potter initiated coverage of Calix (ASX:CXL) as a speculative buy with a $1.10 target as it’s growing organic revenue amid its U.S. expansion into differentiated water treatments. All in all, Calix has five targets, from CO2 emissions in cement manufacture to commercialising its aquaculture and crop protection with a total combined market of $70 billion.
Though the Aussie share market appears to be recovering, it's not exactly been a smooth road in light of Victoria re-entering lockdown. That being said, investors should remember this is only the 4th pullback in 16 weeks.
In this week’s wrap, Jessica covers:
- (0:26) The rocky road to recovery: The ASX200's sluggish return
- (0:37) Tech sector leading the way: Up 2.7% (Mon-Thur)
- (0:53) Five gold stocks make the stock leader board
- (1:02) Gold glistens, Melbourne suffers & the RBA holds cash rate
- (2:19) Afterpay skyrockets (ASX:APT): sales up 120% year-on-year
- (4:40) Thematic Healthcare trading ideas: CSL (ASX:CSL), Sonic Healthcare (ASX:SHL), and Oncosil Medical (ASH:OSL) poised for a booster shot
The Aussie share market is eyeing a 0.4% fall at the open, going by the futures.
The resilient Nasdaq rose 0.5% to hit another new record high helped by Amazon rising over 3% to another record, with Microsoft, Apple and Google-parent Alphabet putting on at least 0.4% each. This has helped the Nasdaq gain 2.7% this week, while the S&P500 is higher by 0.3%
The World Health Organisation (WHO) has published new guidance saying COVID-19 may be transmitted through air particles in crowded and inadequately ventilated spaces, citing “choir practice...restaurants” and fitness classes as examples. Although the WHO says its findings are preliminary, you can’t rule out air transmission.
Local trading ideas:
- UBS rated Vocus (ASX:VOC) as a buy with a $3.60 target, based on valuation, but noted earnings catalysts are potentially negative. Yesterday Vocus closed 0.7% lower at $3.05.
- Bell Potter increased its buy target for Praemium (ASX:PPS) to $0.56 given the software platform looks set to buy listed platform provider PWL for $55.6 million, which will build scale and reinvigorated interest in the stock.
- UBS reiterated its buy rating for CSL (ASX:CSL), but dropped its price target to $331 given the disruptions to its plasma centres in America, due to COVID-19, with UBS expecting donations to fall 20% from April to September, but then pick up.
The Aussie share market looks set to bounce 0.9% higher at the open.
U.S. equities dusted off their knees and attempted to recoup their losses from the prior session. Stay at home stocks soared. Apple shares lifted 2.3% to a new all-time high after Deutsche Bank rose its price target, Microsoft followed up 2.2%, also hitting a new record high. These tech darlings helped the Nasdaq forget about the prior day’s slip, ending 1.4% higher at a brand new record high of 10,493 points.
What to watch today:
- After BHP rose 2% in London overnight, keep an eye on the Aussie listed BHP (ASX:BHP) and other majors like Fortescue Metals (ASX:FMG) and Rio Tinto (ASX:RIO).
Local trading ideas:
- UBS reiterated its buy rating on Independence Group (ASX:IGO) with a price target of $6.20. The Aussie miner reported stronger than expected preliminary copper and cobalt March quarter production results, while nickel production was closer to consensus it was lower than UBS forecasts.
- UBS reiterated its buy rating on Select Harvests (ASX:SHV) with a $7.75 target, while Bell Potter dropped its buy rating to a hold with a $6.10 target. The almond grower has been hit by wet weather which increased its costs allowing drying time, despite that, conditions are at their “best” in the last three years.
- Bell Potter upped its buy rating for dentist group Pacific Smiles Group (ASX:PSQ), increasing its target to $1.75. Pacific Smiles Group signed a 10 year deal with HBF that will accelerate its margin growth, effectively meaning its profits.
The Aussie share market looks set to drop 0.6% at the open, as the rocky recovery continues.
Yesterday we saw the Aussie share market end flat, failing to follow Wall Street’s record rally. But now it is like the boy who cried wolf, traders might be wishing they followed those gains yesterday, as overnight U.S. equities headed South.
Atlanta Federal Reserve said the U.S. economy recovery will be “bumpier” as COVID-19 cases continue to rise, with 2.93 million cases in the U.S..
What to watch today:
- Given the commodity rally, I’d be watching hard commodity miners and producers. On the iron ore front Fortescue (ASX:FMG) and BHP (ASX:BHP), have been reiterated as UBS buys. Citi also likes BHP and Goldman Sachs backs BHP as well, but sees the most upside in Rio Tinto (ASX:RIO).
Local Trading ideas:
- UBS reiterated its buy rating on Imdex (ASX:IMD) with a price target of $1.30, after the cloud-drilling and extraction company snapped up AusSpec for $8.5 million.
- Afterpay (ASX:APT) was given another big upgrade by Bell Potter, beefing up its buy rating and price target to $81.25. It comes as Afterpay announced it’s significantly de-risking the business, raising $800 million. They also have more than doubled its gross merchant value to $11.1 billion and customer numbers to 9.9 million, where the runway for further growth appears bright. Bell Potter upgraded revenue estimates by 3.8%, 5.6%, and 6.3% for FY20, FY21 and FY22 respectively. Bell Potter’s price target is $81.25 per share, while UBS overnight maintained its sell rating in the stock increasing its price target to $27.
- UBS maintained its hold rating on Magellan (ASX:MFG) with a $62.32 price target, after the fund manager shares have gained about 11% so far this year. UBS also noted Magellan has generated performance fees for the group $15 million ahead of expectations.
The ASX200 is set to strongly march forth today, after a positive session overnight. The Aussie futures are suggesting a 0.5% rebound, keeping in mind the Aussie market gained 2.6% last week and is now up 33% from its COVID-19 bear market bottom.
If you are looking for a massive trend to follow or invest in, consider the companies benefiting from the work from home shift across the globe.
In other news, Warren Buffett announced his first significant acquisition since COVID-19 began, buying natural gas and storage assets from Dominion Energy for $10 billion. And on the economic front, the U.S. Service sector which contributes the bulk of steam to the nation’s economic growth tally, showed the sector surprisingly grew.
What to watch today:
- The RBA meets today with interest rates to remain on hold at 0.25%, what the RBA says is it’s lower bound. But comments from the Governor will be closely watched as our economy seems to be picking up even before it’s entered a recession.
- From midnight tonight the NSW and Victorian border will be closed, for the second time in history. Agricultural transportation is not likely to be impacted as special permit holders and exemptions will be allowed to enter and exit.
Local trading ideas:
- Costume jewellery company Lovisa (ASX:LOV) stores are now opened. Bell Potter bumped up its buy rating and price target for Lovisa to $7.50 as its sales were 5% better than expectations with a strong balance sheet.
- UBS reiterated its hold rating on Mayne Pharma (ASX:MYX) after the pharmaceutical company entered into a long-term supply agreement with China based manufacturer for 13 new U.S. generic oral contraceptive products, including the five brand new products not previously marketed. UBS says the five new drugs, four with FDA approval have market sales of $500 million in the U.S., having the drugs made by China’s Novast will save Mayne Pharma US$3 - $5 million per year. UBS’s price target for Mayne Pharma is $0.44 and Bell Potter has them as a buy with a $0.55 target.
- UBS downgraded the ASX (ASX:ASX) from a hold to a sell with a $75 price target, saying although the landscape has changed and the ASX has been a beneficiary of market volatility, expect a round of second capital raising on the ASX. UBS is cautious the ASX’s other earnings streams are trending lower.
The ASX200 is expected to fall 0.6% at the open, keeping in mind the Aussie market gained 2.6% last week.
With Wall Street being closed on Friday for the 4th of July U.S. holiday, Aussie investors will be scouring around for news and leads. In this case, attention has been turned to Europe, where their stocks closed in negative territory on Friday. German car sales crumbled 40% lower in June to a 30 year low.
What to watch today:
- The Aussie Government announced $190 million in funding to boost our local recycling industry. The investment will go to new infrastructure to sort, process and re-manufacture materials such as mixed plastic, paper, tyres and glass. Some companies to keep an eye on are Sims Metal Management (ASX:SGI), Tox Free Solutions (ASX:TOX), Cleanaway Waste Management (ASX:CWY) and Bingo Industries (ASX:BIN).
- ANZ job ads are out today for June and are expected to show a 0.8% rise in June following a 0.5% lift in May. So if the gain is better than expected, keep an eye on consumer discretionary stocks like JB Hi-Fi (ASX:JBH), Afterpay (ASX:APT), Zip (ASX:Z1P), Harvey Norman (ASX:HVN) and Kogan (ASX:KGN).
Local Trading ideas
- Bell Potter initiated coverage of Macquarie Telecom (ASX:MAQ) saying the stock is a buy, with a $51.25 price target following its close on Friday at $45.30.
- UBS released a research report showing Afterpay (ASX:APT) is producing better than expected growth numbers in the U.S. and UK, hitting 1 million customers in England. UBS maintained its sell sceptic rating, Bell Potter has Afterpay as a buy and Goldman Sachs has it as a hold.
- On the smaller side of the market Bell Potter initiated coverage of Kazia Therapeutics (ASX:KZA), a company that’s aiming to treat Glioblastoma, a cancerous brain/spine tumour. Bell Potter has Kazia Therapeutics as speculative as it’s not producing earnings and is making a loss.
In a recovering market, thematic trading seems to be all the hype, with the Tech sector and its darling stock Afterpay (ASX:APT), setting all-time highs. Plus, with the market continuing its recovery, the idea of making lemonade from lemons seems to have gripped investors...
In this week’s wrap, Jessica covers:
- (0:06) What's driving the market gains?
- (0:35) Tech sector sets the trend with a near 7% WTD rise
- (1:02) Afterpay (ASX:APT) rises 20% WTD, Citi expects online & in-store use to continue
- (2:12) Mapping out a strategy: The shift to online education
- (3:09) Buy low, sell high: Opportunities in crashes
- (4:07) Iron ore exports surge
- (5:00) Trading ideas: IDP Education (ASX:IEL), G8 Education (ASX:GEM), BHP (ASX:BHP) and Rio Tinto (ASX:RIO) for consideration
The Aussie share market is tipped to rise 0.6% at the open. So far the ASX200 is on track to close off its best week in five weeks, after rising 2.2% Monday to Thursday.U.S. equities charged following a record rise in U.S. employment with 4.8 million jobs being added in June and the U.S. unemployment rate dropping to 11.1%, both significantly better numbers than expected.
What to watch today:
- U.S. markets will be shut on Friday for the 4th of July Holiday.
- Retail sales data is out for May with the market pricing in a 16.3% recovery following the 17.7% landslide in April.
Local Trading ideas:
- Bell Potter increased its price target for fund manager Janus Henderson (ASX:JHG) to $41.25, noting it's set to benefit from material mark-to-markets during the June quarter and from the ongoing share buyback the company has underway. Janus Henderson also has an attractive dividend with a 6.9% yield and is a buy for Bell Potter.
- Netwealth's (ASX:NWL) shares are already up 19% this year and given the market rallied over 16% in the June quarter, Netwealth's revenue and earnings are expected to be at the top of their guidance level as their assets would have increased. Bell Potter also upped Netwealth's buy rating and price target to $9.10.
- Webjet (ASX:WEB) was reiterated as a UBS buy following select destinations being open for leisure travel. UBS increased Webjet's price target to $5.35.
The ASX200 is eyeing a lift of 0.7% at the open.
The Aussie manufacturing industry surprisingly returned to growth phase for the first time in 8 months, bolstered by production and new order demand.
Investors will be watching the balance of trade which is out today. Balance of trade is the difference between exports and imports. The market is pricing in that the surplus will swell to $9 billion in May, up from $8.8 billion in March. So keep an eye on Australia’s biggest exporters like BHP (ASX:BHP), Fortescue Metals (ASX:FMG), Rio Tinto (ASX:RIO) and CSL (ASX:CSL).
Local Trading ideas:
- Lendlease (ASX:LLC) looks like its turning a corner putting the weaker than expected 2020 profit behind it, which fell heavily short of market expectations. According to UBS, Lendlease’s balance sheet is ripe for a better financial year this year, but investors might have to be patient for the acceleration of its $100 billion+ development pipeline and earnings to come to fruition. UBS ramped up Lendlease's to a buy with a price target of $15.50.
- Following fund manager Perpetual (ASX:PPT) snapping up Trillium, an Environment, Social & Governance (ESG) manager, catering for a growing market of investors who want to exclude investments such as fossil fuels from their portfolio, Bell Potter rose Perpetual (ASX:PPT) to a buy with a price target of $41.10.
- After Suncorp (ASX:SUN) announced an executive shake up, Bell Potter reiterated its buy for the QLD bank. Aside from that, 3% lower cash earnings across the horizon are expected, which is why Suncorp’s price target price dropped to $10.50.
The Aussie share market is eyeing a muted start with the futures suggesting a 0.1% fall at the open to kick off the new financial year and quarter. Yesterday the ASX200 ended the second quarter of the year up 16.7%, the best quarterly rise since 2009.
Wall Street wrapped up the June quarter on a high with the Dow Jones gaining 17.8%, the best quarterly gain since 1987.
What to watch today:
- Manufacturing data for June is out with the sector set to remain in contractionary phase. Building approvals are out and expected to fall 10% given the numbers are from May.
- COVID-19 restrictions ease heavily today in NSW with pubs and cafes to allow max capacity, weddings and public gatherings can have up to 20 people, funerals can have up to 50 people and community sport can kick off. So watch companies like Coca-Cola Amatil (ASX:CCL), Woolworths (ASX:WOW) and Coles (ASX:COL) with food and beverage demand to tick up.
- Alot of ETFs go ex-dividends today, including (ASX:VGS) a popular global investment, and (ASX:VAS) which invests in the ASX300.
Local Trading ideas:
- UBS rated KFC franchisee Colins Foods (ASX:CKF) as a buy following its stronger than expected results in this challenging environment. UBS upgraded its outlook suggesting its price will grow to $10.65.
- UBS reiterated IDP Education (ASX:IEL) as a long term growth stock with a $18.20 target.
- After Telstra (ASX:TLS) lifted mobile prices, UBS also reiterated the telco giant as a buy with a $3.70 target.
The Aussie futures are eyeing a 1.2% lift at the open. Today is the end of financial year, so it could be a volatile day. Wall Street clawed back half of its prior day’s losses on stronger than expected economic data.
After close of trade, Bank of America, Citi, and Goldman announced they’ll keep their dividends the same, following the Fed’s new stress test, while Wells Fargo will have to cut its quarterly dividends.
What to watch today:
- Private sector credit data is out.
- Colins Food (ASX:CKF) reports its full year results.
- There is lot of ex-dividends today, including tech ETFs (ASX:TECH), (ASX:FANG), (ASX:ROBO) and the biotech (ASX:CURE).
Local Trading ideas:
- UBS rated Brickworks (ASX:BKW) as a buy, initiating coverage of the Brickmaker, expecting its shares to grow to $17.10.
- Citi reiterated Coca-Cola Amatil (ASX:CCL) as a buy expecting 15% share price growth as drink consumption begins to fizz up.
- After Fisher & Paykel Healthcare (ASX:FPH) reported a 30% rise in net profit after tax, its highest growth rate in at least a decade. It also provided stronger than expected FY21 profit guidance levels 2% above consensus, given continued level of COVID-19 related demand. Citi reiterated the stock as a sell, however Fisher & Paykel Healthcare trades at 25 times earnings.
The Aussie futures are suggesting a fall of 1.6% at the open, with the U.S. futures currently down 0.5%.
There’s just one more sleep until the end of the financial year, with ASX portfolio adjustments to continue today and tomorrow. Local traders and investors will also be factoring in the poor finish in the U.S. on Friday. The overarching concern is COVID-19 cases are spiking with fears of mandated shut downs and concerns that the market rally was too soon.
What to watch today:
- A survey of U.S. Fund managers has found that they are holding 10% cash, that’s double the long term average. The fund managers also said they are investing in defensives, and technology for growth.
- Ampol (ASX:ALD) appointed Matthew Halliday as Managing Director and CEO.
- Fisher & Paykel (ASX:FPH) reports full year results.
Local Trading ideas:
- Air traffic and management Adacel Technology (ASX:ADA) was reiterated as a Bell Potter buy after the U.S. Army purchased over 60 Adacel simulators valued at US$2.8 million.
- Credit Suisse increased Qantas' (ASX:QAN) share price target to $3.00 after it fell about 13% last week after announcing $15 billion in cost savings over the next three idle years and then $1 billion a year in savings from FY23.
- GUD (ASX:GUD) was reiterated by Citi and Bell Potter as a buy given the rise in spare parts demand. GUD is also paying a fully franked dividend yield and is well above market average.
As major developed countries see debt-to-GDP soar 24% in just two months, the true impact of COVID-19 it seems is finally becoming clear. It's not all doom and gloom however, as opportunities are presenting themselves in the seemingly most unlikely of places - Tech.
In this month's wrap, Jessica covers:
- The economic snapshot reflects the grim reality of COVID-19 - (0:11)
- Sectors: Tech uncharacteristically healthy during economic woes - (1:03)
- Spotlight stock: Afterpay (ASX:APT) ^133%, claiming market leader - (2:07)
- Key themes: Tax loss selling, record spike in debt vs. eco growth & confession season kicks off - (2:33)
- Key analysts' top picks for the new financial year - (5:49)
The Aussie futures are eyeing a 1.2% charge at the open, but local end of financial year selling and the U.S. Fed’s big announcement will keep gains in check, with the U.S. futures already suggesting a hesitant open on Friday.
The U.S. Fed made a huge announcement that big banks will have to suspend share buybacks and cap dividend payments at their current level for the quarter. Dividends will only be allowed to be paid based on a formula of the bank’s recent earnings, as the Fed forecasts loan losses of $700 billion with unemployment hitting 19.5%, significantly pressuring banks.
Today investors will be watching the big banks as they are expected to see pressure following the Fed's announcement of rising debt levels. However, keep in mind many of our banks like CBA (ASX:CBA) have steady underlying income and balance sheets in good shape.
Local trading ideas:
- Following Dr Martens, Vans, Athlete’s foot and shoe business, Accent Group (ASX:AX1) reporting FY20 earnings up 10% compared to the same time last year following tight costs, focus on online sales and government support, Bell Potter increased its price target to $1.80.
- Citi increased its Newcrest Mining (ASX:NCM) valuation as production at the WA Havieron mine has been maintained. Newcrest has remained a Citi buy.
- Macquarie (ASX:MQG) was declared Bell Potter’s top pick for FY21, giving it has strong underlying earnings, keeping in mind if COVID-19 didn’t occur, it’s profit would have been gained 4%, instead of fallen 8%. Bell Potter targets that Macquarie will grow to $135.
The Aussie share market is eyeing a 1.6% fall at the open.
It’s the final countdown, just four trading days remains until the end of the financial year, so tax loss selling of those underperforming stocks is expected to continue.
What to watch today:
- CSL (ASX:CSL) announced it will buy an exclusive global license rights to commercialise an adeno-associated virus (AAV) gene therapy program.
- Qantas (ASX:QAN) entered into a trading halt pending capital-raising announcement.
- Oxygen companies and companies that will be needed with the second COVID-19 wave like Medical Developments International (ASX:MVP), small company ResApp (ASX:RAP) and ResMed (ASX:RMD).
Local Trading ideas:
- Select Harvest (ASX:SHV) is touted to possibly buy RFF’s Mooral almond orchard. Select Harvest was reiterated as Bell Potter buy.
- Sonic Healthcare (ASX:SHL) had it's EPS upgraded by 35% by Citi, with a fall expected next year. Bell Potter upgraded the stock to a buy, it’s also a buy for Citi.
- Qube (ASX:QUB) signed two leases with Woolies (ASX:WOW) in Moorebank. Qube’s balance sheet is very strong with cash of over $1 billion, Citi subsequently downgraded Qube from a buy to a hold.
The Aussie share market is eyeing a 3rd day of gains with the futures suggesting a 0.2% lift at the open after global equities charged and ratings agency Moody’s affirmed Australia’s AAA rating.
What to watch today:
- CSR (ASX:CSR) holds its AGM.
- Following the gold rush, keep an eye on gold companies like Gold Road Resources (ASX:GOR), Newcrest Mining (ASX:NCM), Northern Star Resources (ASX:NST), Evolution Mining (ASX:EVN), IGO Ltd (ASX:IGO) & St Barbara (ASX:SBM).
Local trading ideas:
- AMP (ASX:AMP) was reiterated as a buy by Bell Potter, increasing its target to $2.50 as AMP is set to receive $1.1 billion following the sales of its life insurance business on 30 June.
- Woolworths (ASX:WOW) was reiterated as a buy by UBS following the supermarket's stronger sales numbers announced yesterday, but weaker than expected profit.
- Perenti Global (ASX:PRN) mining services company was reiterated as a buy by UBS but it dropped its price target to $2.00.
- Citi reiterated Harvey Norman (ASX:HVN) as a buy with a price target of $4.60.
The Aussie share market is eyeing a 0.6% gain at the open after new records were made overnight with the oil price jumping over US$40 for the first time since March.
Investors will be watching:
- Energy companies like Santos (ASX:STO) which has lower debt than most of its peers, as well as Woodside (ASX:WPL) which has a lot of head room for an acquisition down the track.
- With copper moving higher, keep an eye on BHP (ASX:BHP) and Oz Minerals (ASX:OZL).
- On the economic front, manufacturing and services data is out for June, with the market expecting manufacturing activity will grow to a reading of 49.3.
Local Trading ideas:
- UBS upgraded James Hardie Industries (ASX:JHX) price target to $34, saying the building company is a key standout following earnings upgrades and better than expected U.S. sales in the first six weeks of Q1. For UBS, James Hardie Industries is a buy, meanwhile Citi also maintained its buy on the stock.
- Ramelius Resources Limited (ASX:RMS) was rated as a buy by Shaw and Partners. Whereas UBS' preferred gold buy is Independence Group (ASX:IGO) expecting its shares will grow to $6.00 with the price of gold tipped to reach US$2,000 in the not too distant future.
- Citi put out a note on Stockland (ASX:SGP) following the CEO’s retirement and after it estimated a 2H20 dividend of 10.6 which was 25% of its guidance levels. Citi expects further downside for Stockland and prefers Mirvac (ASX:MGR) for residential exposure for Goodman Group (ASX:GMG) on the commercial industrial side.
State and Federal Governments are divided over reopening the Australian economy with the World Health Organisation warning the pandemic is accelerating. This explains why the Aussie share market futures are suggesting a 1.3% fall at the open.
Today, investors will be watching:
- BHP (ASX:BHP) & Whitehaven Coal (ASX:WHC) following the coal price gain of 1.6%; and New Century Resources (ASX:NCZ) following the 1.5% uptick in zinc.
- The Federal Government is set to ramp up its spending on cyber security following an attempted hack into Australian networks. You could think about companies that could benefit or the ETF (ASX:HACK) which has already gained 14% this year.
- Metcash (ASX:MTS) full year results were announced. Food, liquor & hardware sales up in FY21 first seven weeks.
- Transurban Group (ASX:TCL) Q42020 sales are out. Transurban announced a reduced distribution of $0.16 per share for the next six months through June.
- Harvey Norman (ASX:HVN) goes ex-dividend today.
- The RBA Governor Phillip Low will be giving a speech at 10am.
Local trading ideas:
- UBS upgraded Adairs' (ASX:ADH) earnings per share following Adairs' sales guidance levels beating their forecasts. UBS gives Adairs a price target of $2.55.
- UBS upgraded Sigma Healthcare (ASX:SIG) price target by 15% to $0.61.
- Bell Potter upgraded AMA’s (ASX:AMA) price target to $0.85 after AMA performed better in terms of profitability and cash generation than management and market expectations.
The ASX200 rose 1.5% this week (Mon-Thur), continuing the COVID-19 claw back. With massive infrastructure investment planned in both Australia and the U.S., and global oil prices recovering from their virus induced hangover, investing and trading ideas continue to emerge from the woodwork.
In this week’s wrap, Jessica covers:
- Compare the pair: the U.S. vs the Australian outlook (0:11)
- High sentiment charges the Tech sector up 5.9% (1:13)
- Healthcare stocks lead the way however with Clinuvel Pharmaceuticals (ASX:CUV) & Healius (ASX:HLS) up over 20% each (1:22)
- Key themes: the infrastructure $1bn fast track package; oil price; and global equities poised to rise (1:41)
- Trading ideas: Boral (ASX:BLD), BHP (ASX:BHP) and NRW (NWH) are picks for thematic infrastructure trading (3:11)
- Trading the oil trend - stock ideas from the major investment banks (3:51)
- The case for U.S. corporate bonds, outperforming the ASX200 (5:13)
The Aussie share market is set for a hesitant start with the futures eyeing a dip of 0.1% at the open.
Investors will be watching:
- Splitit (ASX:SPT) rose over 100% after inking a deal with Mastercard. Pre-market trade suggests it could rally 8% at the open.
- Afterpay (ASX:APT) became the 22nd biggest company on the ASX, following the RBA announcement that cash payments continued to fall on the back of structural trends and COVID-19.
- Evolution Mining (ASX:EVN) cut its gold output guidance and flagged an impairment of up to $100 million.
- UK Retail sales data is out later with stores reopening this week, but online retail is expected to have pushed sales up 5% in May.
Local trading ideas:
- Seek (ASX:SEK) was upgraded to a buy by UBS with a target of $23, following yesterday’s weaker than expected rise in unemployment.
- Temple & Webster (ASX:TPW) was reiterated as a Bell Potter buy given its valuable offering online retail. Bell Potter targets 17% share price growth to $6.10.
- Following Westpac selling its Pendal (ASX:PDL) stake, the fund managers Pendal was reiterated as a Bell Potter buy given Pendals performance fees have grown more than expected.
The Aussie share market futures are suggesting a 0.6% fall at the open. This means we are likely to trim off the week-to-date gain of 2.53%.
COVID-19 cases continued to rise overnight in U.S. states like Arizona and Texas, some of the first to re-open. China has shut down all schools in Beijing and cancelled several domestic flights to slow down the spread of the second wave.
Investors will be watching the unemployment rate which is out at 11:30am. The market is expecting the unemployment rate to rise to 7%, with 125,000 expected to have lost their jobs last month. If these numbers are worse than expected or unemployment is near the 10% mark, like the RBA expects, the market will react negatively. If unemployment is better than expected showing our recovery is ahead of the curve, the market is likely to rally with cyclical stocks like banks, retailers and other consumer spending stocks to do well.
Local trading ideas:
- Imdex (ASX:IMD) was reiterated as buy by UBS with a price target of $1.30.
- Ansell (ASX:ANN) was downgraded to a hold by Citi and UBS, given its trading just under its all-time high. While Bell Potter has Ansell as a buy, given its strong balance sheet and room for acquisitions.
- Brambles (ASX:BXB) has a buy rating from Citi as timber prices have settled and transportation costs have continued to fall along with fuel costs.
- Carsales (ASX:CAR) is eyeing a earnings recovery this year with Morningstar saying it is undervalued but is maintained as a hold by UBS.
The Aussie futures are suggesting a 0.5% gain at the open following yesterday’s gain of 3.9%, the best daily gain in 10 weeks.
U.S. Retail sales skyrocketed 17.5%, 10% more than expected in May. Plus, U.S. President Trump is tipped to be drafting up a $1 trillion infrastructure plan for roads, rail and 5G, which will create jobs for the economy as well.
In Europe, a drug called dexamethasone has been discovered that drastically reduces the death rate of gravely ill COVID-19 patients.
Investors will be watching New Home Sales data for May, BHP (ASX:BHP) and CSL (ASX:CSL).
Local trading ideas:
- Macquarie (ASX:MQG) has been reiterated as a buy by Bell Potter with a price target of $135, implying a 19% share price growth.
- AMA (ASX:AMA) was reiterated as a UBS buy given increased traffic on the roads.
- UBS has reiterated Viva Energy (ASX:VEA) as a buy, increasing its price target to $2.30 following its gain yesterday of 16%.
The Aussie share market futures are suggesting a gain of 2.5% at the open, which will rub out yesterday’s fall of 2.2% and take the ASX200 out of bear market territory which it re-entered yesterday.
The Government says we will have to wait two years before the economy is back at preCOVID-19 levels. In that time, the Prime Minister says he’s targeting 3.75% annual economic growth until 2025. Despite the Government bolstering jobs and infrastructure, the OECD forecasts the Aussie economy will shrink 5% this year.
Investors will be watching Viva Energy (ASX:VEA) and Orora (ASX:ORA).
Local trading ideas:
- Bell Potter upgraded Propel Funeral Partners' (ASX:PFP) price target to $3.65 as the funeral business’ earnings guidance came in 7% ahead of expectations.
- Citi and Bell Potter reiterated Healius (ASX:HLS) as a buy following the $500 million sale of its medical centres.
- Centuria Capital (ASX:CNI) was reiterated as a UBS buy given: 1 - Continued strong demand for yield income in a low interest rate environment, which should growing CNI’s AUM. 2 - Its takeover of Augusta Capital which will grow its assets under management again. 3 - Centuria’s other listed entity Centuria Industrial REIT (ASX:CIP) has made it’s way into the ASX200. Yesterday Centuria Capital closed at $1.79 and UBS targets it to grow to $2.34.
The Aussie share market is eyeing a lift of 0.4% at the open following commodities rallying on Friday.
The Australia Prime Minister is expected to outline details of the Government's JobMaker plan, as well as increased spending on infrastructure projects including the expansion of BHP’s Olympic Dam in South Australia.
Investors will be watching Healius (ASX:HLS) and Select Harvest (ASX:SHV).
Trading ideas:
- Citi estimates there is a 85% downturn of global share markets, suggesting there will be more bad news to come. So in this instance, you might like to consider looking at short ETFs to hedge your portfolio. You could consider (ASX:BEAR), (ASX:BBOZ) and (ASX:BBUS).
- UBS has given Seven Group Holding (ASX:SVH) a price target of $19, expecting a 9.5% rise from Friday's close of $17.35. Macquarie increased its target to $19.10 and Credit Suisse increased its target to $20.35.
- Macquarie increased Santos' (ASX:STO) price target to $6.05.
With Australian and U.S economic data exceeding expectations, the Aussie share market found itself amidst a 3-month high mid-week. However, a second wave of COVID-19 cases emerging in the U.S has swung the market lower on Thursday and Friday.
In this week’s wrap, Jessica covers:
- COVID-19 in the U.S: Texas, Florida & Arizona report spikes in hospitalisation (0:33)
- Three standout stocks (1:22)
- How to play defence in your portfolio? (2:26)
- Two key themes to consider: The rise of online lockdown leisure and; putting the magnifying glass on the rally (3:33)
- Five lockdown trading ideas - thematic trading (5:36)
- Mitigating currency risk using a hedged US ETF (6:59)
The ASX200 is tipped to see heavy selling today, with the futures suggesting a 3% fall at the open.
The second COVID-19 wave hit with the first US states to reopen from lockdown reporting a surge in hospitalisations including Texas, Florida and Arizona.
Local trading ideas:
- Investors have been lining up to buy two Aussie short ASX ETFs before the open, (ASX:BEAR) and (ASX:BBOZ).
- Car dealership company A.P Eagers (ASX:APE) was upgraded again by Bell Potter with new vehicle sales in June expected to rise to the same levels as last year, given Aussies are less likely to jump on public transport and are more inclined to drive to work to.
- UBS increased its target for Qantas to $5.50 with domestic capacity to return to about half of pre-COVID flight levels by the end of next month.
- Testing laboratory business HRL (ASX:HRL) is growing its suite of services and released stronger than expected earnings guidance levels for FY20. Bell Potter maintained it as a buy and increased its price target, expecting 43% capital growth.
Aussie equities have gained for 7 straight days and closed at a new 3-month high yesterday, but the futures are suggesting a fall of 1% at the open following the S&P500 and the Dow losing 0.5% and 1% respectively overnight.
What to watch today:
- Kathmandu Holdings (ASX:KMD) received some heavy weight buy in, with fund managers Harbour Asset Management buying 8.3% of its shares.
- Newcrest Mining (ASX:NCM) announced positive drill results at its WA and Canadian mines with plans for expansion.
- Alliance Aviation (ASX:AQZ) entered a trading halt pending capital raising. Its shares have gained 221% from COVID-19 lows, hitting a new all time high.
Local trading ideas:
- Bell Potter upgraded intellectual property firm IPH’s (ASX:IPH) price target to $8.70 after the firm announced the purchase of a well established IP NZ business for $7.4 million. IPH is a Bell Potter buy, but Macquarie is more bullish with a $9.60 target.
- Bell Potter upgraded building and construction business Johns Lyng Group's (ASX:JLG) price target to $2.90 after JLG announced record job volumes in the second half.
- UBS reiterated WorleyParsons (ASX:WOR) as a buy with a $11.75 target after the company unveiled a new cost cutting project.
The ASX200 is eyeing a fall of 1.6% at the open following yesterday's gain of 2.4%, taking the total gain from the March lows to 36%.
Trading ideas for today:
- CSL (ASX:CSL) was reiterated by Citi as a buy with a price target of $334, while UBS targets $335. CSL’s recent success has been in 1- the acquisition of kidney treatment company Vitaeris, 2-the results of phase 2 clinical trial of for hereditary angio-edema (HAE), and 3 - CSL’s latest involvement in the development of a COVID-19 vaccine.
- Bell Potter upgraded Auswide Bank (ASX:ABA) to a buy, and increased its price target to $5.15
- Bell Potter downgraded Flight Centre (ASX:FLT) to a hold from a buy, noting its 96% gain from COVID-19 lows outpaces the company’s fundamentals.
- Macquarie raised City Chic Collective (ASX:CCX) price target by 20% to $3.25 from yesterday's close of $2.80. The plus size women’s retailer CCX, is also a Bell Potter buy as it has been having great online trade success.
Investors will be watching:
- NZ infrastructure company Infratil (ASX:IFT) announced it secured $250 million NZD from an Institutional Share Placement. So its shares could come under pressure once the new shares are placed onto market.
- Stockland (ASX:SGP) and Smartgroup (ASX:SIQ) hold their AGMs today
- In the US this evening, inflationary data for May is out ahead of the Fed’s Thursday interest rate decision, with rates tipped to remain at 0.25%.
Aussie equites are eyeing another stellar start to the week, and the 6th straight day of gains with the futures suggesting a 0.7% lift at the open. This lift will push the ASX200 above the 6,000-point milestone. In other smashing news, the Aussie dollar soared to a 11-month high, 70.17 US cents.
What to watch today:
- Air New Zealand (ASX:AIZ) announced plan to start earning healthy profits again, even though it may be 70% less than pre-COVID-19 levels.
- Wesfarmers (ASX:WES) announced Officeworks sales are up 28% in the second half, Bunnings rose 19%, Kmart sales rose 4% and Target which it’s winding down, sales walk 2% down.
- OFX Group (ASX:OFX) goes ex-dividend today so we could see some selling.
- NAB (ASX:NAB) business confidence for May
Local Trading ideas:
- UBS rated Fortescue (ASX:FMG) as a Buy with a $14.50 price target, as its overseas competitor, Vales has been ordered to suspend operations in Brazil.
- UBS rose Zip’s (ASX:Z1P) price target to $5.60 and downgraded the stock to a hold ahead of the Quadpay deal being executed.
- Integrated Research (ASX:IRI) was rated a Buy by Bell Potter. Its shares to grow 16% to $4.25, the business expected to benefit from the shift to working from home
- Credit Suisse expects Kogan’s (ASX:KGN) share price will fall to $11.82 following its share price surge of 211% from the March low.
The Aussie share market touches the 6,000pt milestone, hits a 13-week high, and collects a 32% gain from its COVID-19 bottom. Technical trend lines show that significant growth for the ASX200 could be around the corner.
In this week’s wrap, Jessica covers:
- The comeback from COVID-19 (0:15)
- All sectors rise, iron ore hits a 10-month high, pushing up Aussie export revenue & shares in the iron ore majors (0:40)
- Unibail-Rodamco-Westfield (ASX:URW) charges 33% after reopening centres in France, and it's likely to rally further (1:24)
- Three key themes: property developers/fund managers set for growth, a potential looming recession and the U.S triple threat? (2:30)
- How these key themes translate into trade ideas: a word on Centuria (ASX:CNI), CSL (ASX:CSL) and Qantas (ASX:QAN) (4:20)
Investors are tipped to lock in fresh profits with the futures eyeing a dip of 0.2% today after the ASX200 has gained 4% so far this week. The oil price nudged ahead to US$37.41 a barrel with OPEC mulling over extending their production cuts to boost the oil price. The gold price lost $5.90 in value, falling to $1,722. an ounce. Iron ore fell 1.6%, but the price of ore has gone up by 9.4% compared to last week, and it’s trading at $10 a tonne.
What to watch today:
- Kogan (ASX:KGN) just reported June quarter results with Gross Profit rising over 130% across 4QTD of the financial year, and active customers rising to 2 million, that means Kogan.com customers grew by 126,000 in May.
- Companies going ex-dividend include ALS (ASX:ALQ) and Infratil (ASX:IFT) and OFX Group (ASX:OFX) goes ex-div on Tuesday (remember if you buy shares before the ex-div date, you’ll be entitled to the upcoming dividend – which is why on the day ex-div date, shares are usually sold down).
Trading ideas:
- Afterpay (ASX:APT) was upgraded by Bell Potter overnight, with a $65.00 price target, after Bell Potter did a deep dive into profit prospects
- Beacon Lighting (ASX:BLX) Citi’s top small cap pick, got a big boost following the government’s HomeBuilder scheme. Its shares have gained 150% from COVID-19 lows.
- UBS initiated coverage of property group, Centuria (ASX:CNI) for the first time overnight, saying it’s the top buy pick for property fund managers.
In today's morning bell, Jessica discusses:
- Local markets - (0:00)
- Global markets - (0:14)
- What to watch today - (1:21)
- Trading ideas: Afterpay (ASX:APT) - (2:16), Beacon Lighting (ASX:BLX) - (2:30) & Centuria (ASX:CNI) -(3:06)
The ASX200 is eyeing a lift of 1.2% at the open. This week the Aussie share market has gained 3.2% so far and yesterday closed 31% up from its bear market bottom.
Trading ideas:
- Metals and mining company South32 (ASX:S32) was upgraded by UBS from a hold to a buy as the company is restarting its share-buy-back, returning money to shareholders.
- Citi reiterated Aurizon Holdings (ASX:AZJ) estimating 10% share price growth to $5.40, following the company maintaining its earnings forecasts and clearing a funding hurler.
- Citi also reiterated CSL (ASX:CSL) as a buy expecting 18% share price growth on the possibility that elevated flu sales could offset the drop in blood plasma donations.
What to watch today:
- Retail trade data is out for April with the market pricing in a fall of 17.9% following the gain of 8.5% in April. If the figure at 11.30am misses the expectation, keep an eye on discretionary spending stocks.
- Australia’s balance of trade data for April is out today. The market is pricing in that April’s trade balance will fall to a $7.5 billion surplus, so keep an eye on mining stocks like Fortescue Metals (ASX:FMG), BHP (ASX:BHP) and Rio Tinto (ASX:RIO).
- Magellan (ASX:MFG) just announced funds under management grew $1 billion to $98 billion in May with the group receiving new retail inflows in the month.
In today's morning bell, Jessica discusses:
- Local markets - (0:00)
- Global markets - (0:22)
- What to watch today - (1:33)
- Trading ideas: South32 (ASX:S32) - (2:52), Aurizon Holdings (ASX:AZJ) - (3:28) & CSL (ASX:CSL) - (3:44)
Find Bell Direct here:
Twitter: https://twitter.com/belldirect
Facebook: https://www.facebook.com/BellDirectAu...
LinkedIn: https://www.linkedin.com/company/bell...
Instagram: https://www.instagram.com/bell.direct/
Aussie shares look set to rise for the third straight day with the ASX200 expected to lift 0.5% at the open, ahead of Australia’s economic data being released.
Trading ideas for today:
- Following Zip Co’s (ASX:Z1P) 39% gain yesterday after announcing a 90% acquisition of a New York buy now pay later group, as well as raising capital with a major U.S firm, UBS rated Zip Co as a buy.
- Following Virgin Australia proceeding to the next stages of Administration with Bain Capital or Cyrus Capital, UBS says Qantas (ASX:QAN) looks more favourable and will likely see more demand with a target of $4.65.
- Aristocrat Leisure (ASX:ALL) was reiterated as a buy by Citi with a target of $30.10.
Investors will be watching GDP data which is out for the first time in 2020.
In today's morning bell, Jessica discusses:
- Local markets - (0:00)
- Global markets - (0:40)
- What to watch today - (1:36)
- Trading ideas: Zip Co (ASX:Z1P) - (2:14), Qantas (ASX:QAN) - (2:32) & Aristocrat Leisure (ASX:ALL) - (2:49)
Find Bell Direct here:
Twitter: https://twitter.com/belldirect/
Facebook: https://www.facebook.com/BellDirectAustralia/
LinkedIn: https://www.linkedin.com/company/bell-direct/
Instagram: https://www.instagram.com/bell.direct/
The Aussie share market is eyeing a 0.2% gain at the open as investors continue to focus on positivity and global economies reopening. In the U.S, travel and tourism stocks charged, helping the U.S benchmark indices kick off June on a high.
Trading ideas for today:
- Bell Potter upgraded Agribusiness Elders' (ASX:ELD) price target to $11.85, after the agriculture reporting season was better than expected.
- UBS today upgraded Adairs' (ASX:ADH) price target by 13% to $2.15. The stock was also recently upgraded by Goldman Sachs as buy with a target of $2.40.
Investors will be watching Brambles (ASX:BXB), Arena REIT (ASX:ARF) & the RBA meeting today with rates expected to hold at 0.25% given the economy is reopening.
In today's morning bell, Jessica discusses:
- Local markets - (0:00)
- Global markets - (0:13)
- What to watch today - (1:22)
- Trading ideas: Elders (ASX:ELD) - (2:40) & Adairs (ASX:ADH) - (3:06)
Find Bell Direct here:
Twitter: https://twitter.com/belldirect
Facebook: https://www.facebook.com/BellDirectAu...
LinkedIn: https://www.linkedin.com/company/bell...
Instagram: https://www.instagram.com/bell.direct/
A busy week is on the cards for Australian investors. The RBA is meeting tomorrow with rates to remain on hold, while on Wednesday, first quarter economic data is out for the first time this year, with the market pricing 1.4% growth for the quarter.
The Aussie share market is eyeing a subdued start to June, suggesting a 0.4% fall at the open following a cracking close for May, with the ASX200 up 4.7%, while US equities gained 4%.
What to watch today:
- Several states have relaxed their restrictions in ACT, Victoria, NSW. NSW pubs, clubs, cafes and restaurants can have up to 50 customers from today, so keep an eye on food and beverage companies like Costa Group (ASX:CGC), Bega (ASX:BGA), Woolworths (ASX:WOW) and Coles (ASX:COL).
Trading ideas for today:
- Citi raised Event Hospitality & Entertainment (ASX:EVT) price target 31% to $9.75 following its 60% gain off its COVID-19 lows.
- Citi downgraded Lovisa (ASX:LOV) to a sell. However it’s a buy for Bell Potter, as the costume jewellery company has a strong balance sheet.
- Bell Potter reiterated breast screening company Volpara Health Technology (ASX:VHT) as a buy.
- Appen (ASX:APX) reaffirmed its calendar year earnings guidance on Friday and Bell Potter and Credit Suisse downgraded the stock to a hold.
The Aussie share market moves out of bear market territory, hitting a 12-week high on news of further government stimulus and COVID-19 human trials kicking off. The Australian government downgraded JobKeeper dependency, seeing UBS increase its economic forecasts.
In this month's wrap, Jessica covers:
- The three key themes that evolved this month (0:52)
- COVID-19's worst performer now shines, Southern Cross Media (ASX:SXL) (1:15)
- Two stocks that charged after oil rebounded 81% (1:54)
- Three strategic ideas for next month (2:45)
- Six trading ideas as online retail is set to surge (5:01)
- Shedding infrastructure and REITs to trade 'working from home' stocks (6:08)
Today the Aussie share market is eyeing a 0.3% fall at the open. The ASX200 closed at a 12 week high yesterday, only 18% off its all time February high.
What to watch today:
- Machine learning & voice recognition company, Appen (ASX:APX) holds its AGM today
- Fruit & vegetable company, Costa Group (ASX:CGC) holds its AGM too
- Private capital borrowing numbers for April
- U.S President Trump's speech later tonight on the U.S-China tensions
Bell Potter trading ideas:
- Bell Potter upgraded Emeco’s (ASX:EHL) price target to $1.52, implying a 40% share price growth after it handed down strong full year earnings estimates despite COVID-19, beating many expectations.
- Graincorp (ASX:GNC) was reiterated as a buy by Bell Potter, increasing its price target to $4.85, implying a 14% growth from yesterday’s close after Graincorp’s earnings estimates for FY21 remain on the upside.
- WiseTech (ASX:WTC) was reiterated as a sell, with Bell Potter expecting its shares will fall to $17.50.
In today's morning bell, Jessica covers:
- Global markets - (0:00)
- Local markets - (0:52)
- What to watch today:
- Appen (ASX:APX) - (1:13)
- Costa Group (ASX:CGC) - (1:38)
- Private borrowing data for April - (2:00)
- Bell Potter trading idea: Emeco (ASX:EHL) - (2:22), Graincorp (ASX:GNC) - (2:48) & WiseTech (ASX:WTC) - (3:03)
Aussie share market futures are eyeing a 0.9% lift at the open, following global equities.
U.S and European markets rallied ahead overnight, despite Hong Kong being threatened as a financial hub and now no longer being autonomous from China.
Trading ideas for today:
- Bell Potter upgraded PointsBet (ASX:PBH) as a speculative buy, with a target of $7.00, implying a 31% share price growth from $5.35.
- Virgin Money (ASX:VUK) was upgraded by Bell Potter with a $1.90 price target, implying a 4% growth from yesterday’s close.
- Treasury Wines (ASX:TWE) was reiterated as a UBS buy with a $14.80 price target, implying a 52% growth from its close at $9.69 yesterday.
Investors will be watching:
- Companies going ex-dividend today - Orica (ASX:ORI), Qualitas (ASX:QRI), TechnologyOne (ASX:TNE) and Investec (ASX:IAP).
- Private capital spending data is out for the first quarter and is expected to fall 2.6% following the prior 2.8% fall.
- Senate Select Committee meeting on COVID-19 in Parliament at 10.00 am AEST
This week, the ASX200 has gained 5.1% and is now 19% off from the February all-time high. But today, the ASX futures point to some profit taking, suggesting a 1.1% fall at the open.
What to watch today:
- ALS (ASX: ALQ) - hands down its full year results
- AGMS: AMA Group (ASX:AMA) & Spark Infrastructure (ASX:SKI)
- Amcor (ASX:AMC) goes ex-dividend
- Aged care companu, Japara Healthcare (ASX:JHC) annoued $270-$300m write down/impairment
Trading ideas for today:
- Bell Potter rated Coca-Cola Amatil (ASX:CCL) as a buy, given its results yesterday and unprecedented cost cutting.
- Coronado Global Resources Inc (ASX:CRN) was upgraded by Bell Potter given its U.S mines are restarting production on 1 June.
Aussie investors will be looking to see if we can extend our rally with the ASX200 set to rise 0.8% today at the open. If we do, we will technically be almost out of a bear market, as the market would be 20% off its all-time February high.
Trading ideas for today:
- Bell Potter upgraded City Chic Collective’s (ASX:CCX) price target to $3.40, implying a 21% growth from its $2.82 close price yesterday.
- Select Harvests (ASX:SHV) delivered half year results with strong crop yield. Select Harvest was reiterated as a buy by UBS and Bell Potter following its half year results.
All eyes on Coca Cola (ASX:CCL), Unibail Rodamco Westfield (ASX:URL) & Amcor (ASX:AMC).
Aussies shares are eyeing a 1.2% rise at the open going by the futures, despite global equities closing mixed on Friday amid simmering China-U.S tension.
Two trading ideas for today:
- Bell Potter upgraded NAB (ASX:NAB) from a hold to a buy with a price target of $17.30, implying 12% yearly growth from its $15.32 close price on Friday.
- Australian Finance Group (AFG) issued over 12 million new shares onto the market following a capital raising and looking at Trading Central’s charts it’s showing more bullish signals.
Investors will be watching:
- Eclipx Group (ASX:ECX)
- China is seeking to impose a National Security law on Hong Kong, which threatens Hong Kong’s future as a regional financial hub.
- US futures are currently trading higher, suggesting a positive open when Wall Street opens. But if China imposes the law and Hong Kong retaliates, keep an eye on your ASX200, GEAR or BEAR holdings.
As global COVID-19 restrictions ease, the Aussie share market sees a continuation of its April-May bounce back. The oil price climbs to a 10-week high as drivers once again fire up their engines. Lastly, both U.S and Aussie equities enjoy 10-week highs, rising 3% and 2.7% respectively (Mon-Thu).
In this week’s wrap, Jessica covers:
- Energy sector charges up 8%, while Utilities drag 2% (0:44)
- NRW Holdings (ASX:NWH) sees a 44% uptick following record breaking results, with UBS and Citi backing further growth (0:58)
- Orocobre (ASX:ORE) shoots up 21% as the lithium carbonate price is tipped to shine (1:54)
- Buying the dip: Webjet (ASX:WEB) (2:27)
- The 10 momentum stocks to watch (2:52)
- What could move the market next week? (4:12)
- Bell Potter upgrades Afterpay (ASX:APT) following U.S success (4:31)
Aussies shares are eyeing a hesitant start today after U.S equities ended lower on Thursday, with investors taking profits and Amazon shares falling 2% after hitting an all-time high in the previous session.
Two trading ideas for today:
- Bell Potter upgraded Afterpay (ASX:APT) with a $51.50 price target after it announced it surpassed 5 million active U.S customers.
- AMA Group (AMA) was reiterated as a Buy by Bell Potter, with a $0.80 price target.
Investors will be watching: Wesfarmers (ASX:WES), Sydney Airport (ASX:SYD) & Macquarie (ASX:MQG).
Aussie shares are eyeing a 0.6% gain at the open, which means we could rise for the 5th straight day extending that new 6-week high set yesterday.
Records have been broken on Wall Street with Facebook and Amazon shares soaring to all-time highs.
A trading idea for today, Bell Potter has Australian Agricultural Co (ASX:AAC), as a buy with a price target of $1.40, implying a 26% share price growth in a year from yesterday’s close of $1.11.
Investors will be watching Aristocrat (ASX:ALL) & the pre-release Manufacturing and Services industry data that is out for May, which could move markets.
In today's morning bell, Jessica covers:
- Global markets - (0:01)
- Local markets - (0:40)
What to watch:
- Aristocrat (ASX:ALL) - (0:52)
- Manufacturing and Services data for May - (2:04)
- Bell Potter trading idea: Australian Agricultural Co (ASX:AAC) - (2:32)
Aussie equities yesterday popped to a 6-week high after gaining 1.8%, which saw the ASX200 settle 22% up from its March low. But today it looks like some of those profits will be trimmed as Aussie futures suggest a 1.5% fall at the open.
It comes as US shares fell into the red in the final hour of trade on the back of news reports that raised concerns about a potential COVID-19 vaccine from Moderna.
A trading idea for today, Bell Potter reiterated Avita Medical (ASX:AVH) as a speculative BUY, with a price target of $0.81, implying a 78% share price growth in a year from yesterday’s close of $0.455.
Investors will be watching BHP (ASX:BHP), Fortescue Metals group (ASX:FMG), Rio Tinto (ASX:RIO), Sydney Airport (ASX:SYD) & Australian Agricultural Co (ASX:AAC).
In today's morning bell, Jessica covers:
- Local Markets - (0:02)
- Corporate News - (0:35)
- Global Markets - (1:12)
What to watch:
- Australia's iron ore majors - (1:50)
- Sydney Airport (ASX:SYD) - (2:16)
- Australian Agricultural Co (ASX:AAC) - (2:27)
- Bell Potter trading idea: Avita Medical (ASX:AVH) - (2:59)
Aussie equities are set to set for a cracking trading day if you go by the futures, which are suggesting a 2% lift at the open.
The three keys reasons are:
- Moderna, another U.S company, is close to a COVID-19 vaccine after its trial treated 45 people.
- The U.S central bank chair said he was “highly confident” the economy will claw back from its pullback, but warned it may not fully recover until a COVID-19 vaccine is complete.
- The Chinese President vowed to share a COVID-19 vaccine once it’s available, he also pledged $2 billion towards the fight and also backed the World Health Organisation.
A trading idea for today, Bell Potter bumped up its price target for the agri-business Elders (ASX:ELD) to $11.75, implying a 14% share price growth in a year from yesterday’s close of $10.34.
Investors will be watching: James Hardie Industries (ASX:JHX), OFX Group (ASX:OFX), TechnologyOne (ASX:TNE), Adelaide Brighton (ASX:ABC), Atlas Arteria Group (ASX:ALX) & the RBA's meeting minutes.
In today's morning bell, Jessica covers:
- Local market - (0:03)
- Global markets - (0:47)
What to watch today:
- James Hardie Industries (ASX:JHX) - (1:38)
- OFX Group (ASX:OFX) - (1:38)
- TechnologyOne (ASX:TNE) - (1:44)
- Adelaide Brighton (ASX:ABC) - (1:48)
- Atlas Arteria Group (ASX:ALX) - (1:48)
- The RBA's meeting minutes - (1:55)
- Bell Potter trading idea: Elders (ASX:ELD) - (2:14)
- ETFs - (2:56)
Aussie equities are set to start the trading week in the right direction, with the futures eyeing a 0.6% lift at the open.
A trading idea for today, Bell Potter reiterated Cyclopharm (ASX:CYC) as a buy with a $1.77 price target, implying a 31% share price growth in a year from Friday's close of $1.35.
Investors will be watching Auckland International Airport (ASX:AIA) & Ramsay Health Care (ASX:RHC).
In today's morning bell, Jessica covers:
- Aussie futures (0:05)
- Overseas markets (0:26)
What to watch today:
- Auckland Health Care (ASX:AIA) (1:00)
- Ramsay Health Care (ASX:RHC) (1:36)
- A 'recovery steadily' later this year for the US economy (2:11)
- Bell Potter trading idea: Cyclopharm (ASX:CYC) (2:31)
The Aussie share market was eyeing a 0.9% gain at the open, but will need to rise 1.2% to claw back Monday to Thursday’s fall.
Milestones were reached overnight as the oil price saw its biggest jump in 2-weeks with U.S stockpiles falling while demand creeps ahead.
A trading idea for today, Bell Potter rose GrainCorp's (ASX:GNC) price target to $4.20, implying a 14% share price growth in a year from yesterday’s close of $3.67.
All eyes on Unibail-Rodamco-Westfield (ASX:URW), Star Entertainment (ASX:SGR), Coca-Cola (ASX:CCL), the iron-ore price, a new round of economic stimulus in the U.S & U.S retail sales numbers for April.
The Aussie share market futures are suggesting a fall of 1% at the open. Traders will absorb U.S and European equities pairing back and falling into the red, while the oil and gold price pushed ahead overnight.
A trading idea for today, Bell Potter rose Emeco's (ASX:EHL) price target to $1.40, implying a 37% share price growth in a year from yesterday’s close of $1.03.
Investors will be watching Graincorp (ASX:GNC), OceanaGold Corp (ASX:OGC), Xero (ASX:XRO) and Aussie unemployment data for April.
All eyes today are on CBA’s financial results and the unfolding tension between China and Australia, after Beijing banned importing beef from 4 Aussie abattoirs.
Looking at the futures, the Australian share market is set for a fall of 1.3% at the open.
A trading idea for today: Bell Potter rose Premier Investments' (ASX:PMV) price target to $18.50, implying a 21% share price growth in a year from yesterday’s close of $15.42.
Investors will be watching CBA (ASX:CBA) and Stockland (ASX:SGP).
The Australian share market is now officially back in bull market territory, after rising 1.3% yesterday, which takes the total rally from the March low to 20%. Today, the futures are suggesting that the market will fall around 0.4% at the open following a mixed session on global markets.
What to watch today:
- Packaging company, Amcor (ASX:AMC) just reported quarterly results noting its integration of its takeover of Bemis, is continuing ahead of expectations.
- Circuit board company, Altium (ASX:ALU) announced Coronavirus restrictions are likely to hit 4Q performance. ALU shares have gained 22% in weeks.
Reporting results today include:
- AusNet Services (ASX:AST)
- CSR Ltd (ASX:CSR)
- Incitec Pivot Ltd (ASX:IPL)
A very busy week is on the cards for Aussie investors this week, awaiting local business and consumer confidence, and unemployment numbers for April.
Kicking the week off, the Australian share market futures are eyeing a lift of 0.1% at the open. It comes as global markets pushed higher on Friday as the US unemployment numbers were better than economists expected with 20.5 million Americans losing their jobs last month, which was bleak but far better than the 21.5 million forecast.
Trading ideas for today, AMP's (ASX:AMP) price target was lifted to $2.15 by Bell Potter, implying its shares will grow over 50%. Elders (ASX:ELD) was also raised by Bell Potter to a price target of $10.30, implying its shares will grow by 13%.
Investors will be watching GrainCorp (ASX:GNC), Pendal Group (ASX:PDL) and CIMIC (ASX:CIM).
The Aussie share market sees its best weekly gain in five weeks, with the ASX200 gaining 2.3%, the All Ordinaries rising 2.4%, and the Small Ordinaries soaring 3.2% (Monday to Thursday). With the curve flattening, people are taking to the road, steadily increasing both oil demand and the oil price.
In this week’s wrap, Jessica covers:
- I.T leads the charge, up 10% in this week's sectors report (0:22)
- With a 35% rise, Afterpay (ASX:APT) leads the way, while NRW Holdings (ASX:NWH) heads in a different direction... down 8% (1:03)
- Afterpay & Tencent's future partnership? (1:32)
- What's ahead? CBA results, March home loans and unemployment data (2:30)
- What does Virgin Money (ASX:VUK) Macquarie (MQG) and IPH (ASX:IPH) have in common? - They're all featured Buy stocks by Bell Potter (3:47)
As a reminder, during this unique and uncertain time, Bell Potter research is now available to all Bell Direct clients. You can access the Bell Potter research bank here.
The Australian share market is tipped to nudge 0.1% higher at the open going by the futures. From Monday to Thursday the ASX200 gained 2.3%, so if the market holds these levels, the ASX200 will have made its best weekly gain in 5 weeks.
A trading idea for today, IPH (ASX:IPH) was reiterated as a Buy by Bell Potter, expecting share price growth of 17% to $8.50 in a year.
Investors will be watching APA (ASX:APA), News Corp (ASX:NWS) and Macquarie (ASX:MQG). The RBA will also be releasing its statement on monetary policy at 11.30am.
The Australian share market is sitting with a weekly gain of 2.6% as at Thursday morning before trade, however profits are expected to fall as the futures suggest a 0.9% drop at the open.
A trading idea for today is Altium (ASX:ALU). It had its price target lifted by Bell Potter to $37.50, which implies that the share price will grow 6.2% in a year.
Investors will be watching Rio Tinto (ASX:RIO), Orica (ASX:ORI), Macquarie (ASX:MQG) & Aussie March export data.
The Australian share market is eyeing a fall of 0.2% at the open going by the futures, with traders awaiting local retail data out today. On overnight markets, global equities, oil and gold all gaining ground.
A trading idea for today, A.P Eagers (ASX:APE) was reiterated as a Buy by Bell Potter. Bell Potter says we could see a behavioural shift as consumers are less likely to catch general public transport and more likely to want to drive a car.
Investors will be watching: Pushpay (ASX:PPH) & Genworth Mortgage Insurance (ASX:GMA).
The Australian share market is set to rise for the second straight day this week, with the futures suggesting a 0.3% gain at the open. This comes as Italy, Finland and some U.S States have eased their lockdowns, fuelling the oil price back above $21 a barrel.
Trading Idea: Westpac (ASX:WBC) was reiterated as a Buy by Bell Potter overnight following the bank's half year results yesterday.
Investors will be watching Kathmandu (ASX:KMD), James Hardie (ASX:JHX), Westpac (ASX:WBC) and the RBA meeting today.
The Australian share market is eyeing a soft start to the week with the futures suggesting a 0.1% fall at the open. It comes as US equities ended lower on Friday despite Gilead’s COVID-19 vaccine being approved by the US FDA and rolled out to patients in America.
Today investors will be watching Westpac (ASX:WBC), Afterpay (ASX:APT) and Fortescue Metals (ASX:FMG).
Building Permits/approvals are out for March with consensus expecting a 15% drop, following the 19% surge in Feb. All eyes will be on construction linked companies like Brickworks (ASX:BKW), Boral (ASX:BLD) and Adelaide Brighton (ASX:ABC).
The Australian share market is set for a breather today with the futures suggesting the ASX200 could fall 2.2% at the open following global equities.
Wall Street investors trimmed profits overnight as weaker economic data came out, while hopes are still high for a COVID-19 vaccine.
Today, investors will be watching Origin Energy (ASX:ORG), Austal (ASX:ASB), ResMed (ASX:RMD) & new home sales for March.
On Thursday, the ASX200 closed off the month up 8.8%, the best monthly gain on record since the data set began in 1993. Not bad... almost as good as the All Ordinaries clocking off the month with a 9.5% rise - its best result since 1988. Plus, the University of Queensland and Gilead make breakthroughs in potential COVID-19 treatments.
In this week’s wrap, Jessica covers:
- Four key reasons the markets rallied (0:35)
- Energy gets a boost, rising 12% in this week's sectors report (1:13)
- Stocks in the spotlight: (Mon-Thu) AP Eagers (ASX:APE) up 46% while ResMed (ASX:RMD) fell the most, down 6% (1:23)
- Are we back in bull territory? (2:35)
- Recalling a not-so-distant historical 20% rally in a bear market (3:12)
- Stock ideas: Bell Potter's list of 10 recovery stocks (4:01)
The Aussie share market is set for its best monthly gain since January this year. This week, the focus has been on the Banking sector, with some of the banks releasing their half-year results.
In this month's wrap, Jessica covers:
- IT leads growth sectors in this month's sector report (0:19)
- Stocks in the spotlight: Afterpay (ASX:APT) rises 51% & Metcash (ASX:MTS) slides 21% (1:11)
- HY results: Where will NAB (ASX:NAB) go from here & what to watch with Westpac (ASX:WBC) (2:19)
- The best of the banking sector (5:01)
- What to watch next week: RBA & trade data announcements
The Australian share market looks like it will re-enter a bull market this morning following a stellar night on overseas and commodity markets, as the world is closer to a vaccine for COVID-19. The Aussie futures are eyeing a lift of 2% at the open, so if the ASX200 does see that rally, the local market would have collectively gained 21% from its March lows which means we’ll be back in bull territory, as a bull market is defined as a gain of 20%.
Global markets rallied for three important reasons:
- US biotech tech company, Gilead revealed its trial cured over 50% of the patients with severe COVID-19, with a five-day dose of it's drug Remdesivir.
- COVID-19 cases are slowing in the U.S
- The US Federal Reserve pledge to keep rates as close to near zero to help the US economy.
Today, investors will be watching: ANZ (ASX:ANZ), Fortescue Metals Group (ASX:FMG), GPT Property Group (ASX:GPT), Mirvac (ASX:MGR), Qantas (ASX:QAN) and Woolworths (ASX:WOW).
This evening, all eyes will be on weekly jobless claims.
The Australian share market is eyeing a lift of 0.4% at the open according to the futures, despite a mixed session overnight. Aussie's investors attention today will be on local inflation data due out, Coles (ASX:COL) first quarter sales results and what the Fed announces.
US stocks saw selling overnight ahead of the US Federal Reserve’s announcement with the Nasdaq down 1.4%, the S&P500 ending 0.5% lower and the Dow Jones falling slightly by 0.1%.
Today, investors will be watching Coles (ASX:COL), Brickworks (ASX:BKW) and Select Harvest (ASX:SHV).
This evening all eyes will be on the U.S Federal Reserve decision.
The Australian share market looks set for a cautious opening if you go by the futures, with investors weighing up three key things:
- The Global equity rallying overnight
- The oil price swinging 25% lower to $12.93 on fears that worldwide storage will soon be at capacity
- Local earnings results due out today from Aussie companies
Looking at overnight markets, Wall Street charged ahead with their benchmark indices all gaining over 1%, on hopes of further lockdowns being lifted, while earnings news from Deutsche Bank and pharmaceutical Bayer helped fuel European equities higher and saw the German market gain over 3.1%.
Today, investors will be watching St Barbara (ASX:SBM), Saracen (ASX:SAR), Northern Star Resources (ASX:NST), Growthpoint Properties Australia (ASX:GOZ) and Mesoblast (ASX:MSB).
Aussie investors will be sifting through mixed results from global markets on Friday. They will also be turning their attention to local financial results due out this week, including NAB (ASX:NAB) which reported today, ANZ (ASX:ANZ) on Thursday with Coles (ASX:COL), Woolworths (ASX:WOW) and Qantas (ASX:QAN) set to announce quarterly updates this week.
The ASX200 eyed a 1.6% gain at the open going by the futures, this was helped by a lift in the oil price as well as Tech, Mining and Healthcare stocks on Wall Street.
It will be a busy week on Wall Street with Google parent Alphabet reporting quarterly numbers, along with Microsoft, Apple, Amazon and Facebook.
Today investors will be watching NAB (ASX:NAB) and MyState (ASX:MYS).
Though it's been a negative week for the Aussie share market, light seems to be at the end of the tunnel for some stocks. With the volatility index falling from its 9-year high to a 7-week low, the market is seemingly more tame. However with immediate threats subsiding, the question of when the consequences of COVID-19 will be fully realised is now on the table.
In this week’s wrap, Jessica covers:
- The sector report: defensive sectors hold fast (0:43)
- The stock report: as gold spikes, Regis Resources (ASX:RRL) sees an upturn (1:13)
- Gold shines on ETF leaderboard (3:49)
- Are we truly headed for the deepest recession in modern history? (5:26)
- Stock idea: a2 Milk (ASX:A2M) posts positive 3rd quarter results (5:52)
The Aussie share market is eyeing a gain of 0.2% going by the futures, which will be welcomed given the market has lost about 5% this week.
Sobering weekly unemployment data came out of the US last night, with total number of jobless claims over the past 5-weeks to 26 million which is 16% of the labor force.
Today, all eyes will be on: MyState (ASX:MYS), Australian Pharmaceutical Industries (ASX:API), Speedcast (ASX:SDA) and Air New Zealand (ASX:AIZ).
This evening, investors will be watching: in the U.S, new home sales and manufacturing and service data, while in the UK, March retail numbers.
Markets breathed a sigh of relief last night and clawed back some recent losses after the US President Donald Trump fired off a tweet that fueled the oil price to move higher.
Markets: The Nasdaq rose 2.8%, the Dow gained 2%. London’s FTSE had the most fire in Europe, rising 2.3%.
Commodities: Crude oil rised 22%, clawing back recent losses, settling at $14.23 while brent oil pumped up 20%. The gold price gained a bit of shine, rising to $1,736.90.
What to watch today: Oil and mining companies on the ASX after their US and European counterparts rose 3%, a2milk (ASX:A2M) after Citi upgraded its price target after a2milk rose its earnings forecasts, Evolution Mining (ASX:EVN) after it reported no material impact from COVID-19 and maintained guidance, and AMP (ASX:AMP) after it reported a mixed third quarter with loans rises while assets under management fell. Also watch US futures this afternoon as traders weigh up what to expect.
The Australian share market put the brakes on for the 3rd day, as US equities felt weak at the knees for their 2nd session. This follows oil price’s massive decline amid oversupply and crippled demand due to COVID-19 lockdowns.
Today, the oil price clawed back overnight and the Aussie share market is up 13% from its March lows meaning we are no longer in a bull market.
Companies on the ASX leaderboard: WiseTech (ASX:WTC), Pinnacle Investment Management Group (ASX:PNI) and Spark Infrastructure (ASX:SPK).
Stocks seeing the most selling: NRW Holdings (ASX:NWH), oOh!Media (ASX:OML) and Stockland (ASX:SGP).Investors are watching GPT Group (ASX:GPT) and Caltex (ASX:CTX).
The Australian share market is on for a cautious day of trade given the topsy-turvy evening and morning we had.
The Australian share market opened 0.6% lower then clawed back some of those losses and is tracking 0.2% lower with Healthcare, Utilities, Banks and Energy rising.
Overnight, the crude oil price collapsed, Virgin (ASX:VAH) entered voluntary administration and international markets somewhat held up with the Stoxx600 and the S&P500 gaining 0.7% and losing 1.8% respectively.
Investors will be watching: Metcash (ASX:MTS), APA Group (ASX:APA) and Praemium (ASX:PPS).
The Australian sharemarket is having a choppy start to the week and is tracking 1.4% lower before noon, erasing Friday's 1.3% gain. However, for the month of April, the market is still up 6.4%.
In Australia, investors will be watching: the Energy sector, Caltex (ASX:CTX), Fortescue Metals (ASX:FMG) and the Staples sector.
Looking at the biggest stock moves: AP Eagers (ASX:APE), Nine Entertainment (ASX:NEC), Domain (ASX:DHG) and Southern Cross Media (ASX:SXL).
With four consecutive weeks of growth, and the market gaining over 20% from its March lows, the bull market has technically set in. With all sectors up across the board, it seems Australian shares are steaming ahead for the short term. However, we look ahead to see what we could be in for based on historical data from the GFC.
In this week’s wrap, Jessica covers:
- A bull market amid a bear (0:23)
- All sectors up: Energy leading the way (0:39)
- Stocks in the spotlight: NRW Holdings (ASX:NWH) up 46.61% (0:59)
- Weekly changes: mixed coverage for Afterpay (ASX:APT) (3:20)
- Bell Potter stock recommendations & champion stocks (4:12)
- What to watch next week (6:11)
Australian share market wrap Friday 17 April, featuring best and worst ASX 200 performers and what to watch next week.
The Australian sharemarket gained 1.3% today. Over the week the market rose 1.9%, rising for the 4th straight week. So far this April, the market has gained over 8%. That’s THE best monthly gain in over 9 years.
In terms of Economic new out today: China’s Industrial production fell 1.1% in March on a YOY basis, while the market expected it to drop by 7%. Chinese economic growth fell by 9.8% in the first 3-months of the year. That fall was better than the 9.9% drop expected.
That's why we saw the ASX Industrial sector rise the most, up 4.5% today leading most sectors higher. While Consumer Staples gained the least with Treasury Wine Estates and Coca Cola shares fall.
Best performer: Mayne Pharma, (ASX:MYX) up 9% after getting ready to enter the U.S with a contraceptive pill that could produce $200 million a year in sales. Stockland (ASX:SGP) shares gained 8.5% after increasing its liquidity to combat reduced foot-traffic across its shopping centres. Worst performer: Coca Cola (ASX:CCL) losing 6.1% despite flagging $140 million in savings measures.
Aussie shares came under pressure at the open, falling 1.9%, following Wall Street and European equities which lost 2.2% and 2.3% respectively. With the risk-off environment returning, money flowed back into bonds and gold, pushing the gold price up 0.2%. Meanwhile, oil gained 1.7%, moving back above $20 a barrel.
Today, investors will be watching:
- Financials, Energy and Materials
- Woodside Petroleum (ASX:WPL)
- Contact Energy (ASX:CEN)
- Star Entertainment (ASX:SGR)
- Vista Group (ASX:VGL)
- Stocks bucking from COVID-19, Fisher & Paykel (ASX:FPH), Costa Group (ASX:CGC), Resmed (ASX:RMD), Metcash (ASX:MTS), Coles (ASX:COL), Chorus (ASX:CNU) and all defensive stocks
- The US dollar
The Australian share market looks like it could extend its bull market rally following the 1.9% rise yesterday, as Wall Street rallied overnight.
The COVID19 infection curve is flattening globally. And in the U.S, the 1st batch of quarterly earnings results came out overnight, with Johnson and Johnson results beating forecasts, while it raised its dividend, which boosted its stock over 4% higher. Earnings from the financial segment, like JPMorgan were below expectations though, but JPMorgan’s trading division revenue surged 32% to a record US$7.2b.
Gold fell 0.8%, to $1,758 an ounce. While Oil fell back to $20 a barrel as demand remains low. But that could all change as Trump plans to restart some U.S states on 1 May.
What to watch today:
1. Local IT stocks are expended to do well again today - buyers are already lining up to buy Altium (ASX:ALU) and Appen (ASX:APX) and Bravua (ASX:BVS) and Afterpay (ASX:APT).
2. Gold stocks which rallied 14% yesterday – like Northern Star (ASX:NST) look like they could see profit-taking.
3. Also look out for stocks are linked to the Chinese consumer – they could start to build moment given China 1st quarter import data yesterday showed their imports are rebounding
4. Also, keep an out for institutional buying. Under Research and Tools on Bell Direct, you can click Substantial holdings. Yesterday you would have seen Flight Centre FLT shares rose 16% yesterday after Credit Suisse and its associated entities increased their stake in the business – and now again overnight another investor- UBS – bought into the stock.
5. Infant formulae and goat milk business, Bubs Australia (ASX:BUB) are expected to rally after Bubs reported sales rose 67% in the quarter.
The Australian share market is continuing to rise of its March lows, pushing further into positive territory hitting a four week high, as the coronavirus outbreak appears to have turned a corner, while in the US - a level of uncertainty was removed as Bernie Sanders stood from the presidential race, while the oil price gained 4% to about $26 a barrel ahead of planned production cuts by OPEC later today. US equities ended higher overnight with the S&P500 up 3.4%.
In terms of the most valued stocks, CSL shares rose 2% it affirmed its profit guidance for FY20 of $2.11 to $2.17 billion. The big four banks are higher today with ANZ and NAB up the most over 3% with WBC following, while the best big four bank performer this year, CBA is up 1%.
The Property, Industrials, and IT sectors are up 4 to 5%. Investors also watching; Perenti Global (ASX:PRN) as NAB became a major shareholder, ooh! Media (ASX:OML) which gained for the second week (while it delayed its AGM due to COVID19), and Credit Corp (ASX:CCP) which has seen big institutional ownership changes. While Northern Star (ASX:NST) falls 3% on the gold price slip along with Independence Group (ASX:IGO)
The ASX rose for the second consecutive week, climbing 2.8% after last week's 4.7% rise. However, volatility is not expected to be over just yet. We look to the GFC for a textbook example of temporary rallies followed by further falls.
In this week’s wrap, Jessica covers:
- Aussies buying the dip: all ASX sectors make gains this week (1:45)
- Stocks in the spotlight: Vicinity Centres (ASX:VCX) up 22% (1:59)
- A word on utilising your super during COVID-19 (3:00)
- Dividend traps: re-evaluate before you fall behind the mark (4:16)
- Data driven stock ideas: using Bell Direct's Strategy Builder (5:00)
The ASX200 opened 1.9% lower, largely as expected with most sectors in the red, except Staples moving higher. It comes as US equities retreated overnight with oil slipping. We saw Europe stocks advance with the German Dax up 2.8% and London FTSE up 2.2% on hopes European COVID-19 cases have peaked, while the UK prime minster is now stable in ICU.
All eyes on Westpac (ASX:WBC), National Australia Bank (ASX:NAB), Australia & New Zealand Banking group (ASX:ANZ), Commonwealth Bank of Australia (ASX:CBA), Treasury Wine Estates (ASX:TWE) & Austal (ASX:ASB).
The Australian share market is expected to continue to rally at the open, with the futures suggested a 2.4% lift today.
Yesterday the ASX200, gained 4.3% as COVID-19 new cases slowed in Australia, while the energy sector led the charge following its biggest weekly gain in history.
Today further impetus behind us, as US equities surged over 7% higher with the new COVID-19 cases appearing to be slowing there. In Europe cases are slowing, helping the benchmark Stoxx600 end 3.7% up. Meanwhile, the Oil price has held above $26.30 despite losing 8% on uncertainty as to when these crude oil output cuts will come, to stabilise the market.
Investors will be watching: The RBA meets today for its April monthly meeting- with rates expected to remain on hold. Also keep your eyes out for Australian export and import figures, both of which are expected to have slowed in February. So I’d be watching some of Australia's biggest exporters, BHP (ASX:BHP), Fortescue Metals Group (ASX:FMG), Woodside Petroleum (ASX:WPL), CSL (ASX:CSL), packaging business Amcor (ASX:AMC), gold miner Newcrest Mining (ASX:NCM) and port company Qube (ASX:QUB).
The Aussie share market opened 2.1% higher in the first 30 mins of trade erasing Friday’s 1.7% loss. The energy sector is leading the advance today as it did last week on hopes of an oil price truce between Russia and Saudi Arabia.
What to watch this week economically and ASX upgrades/downgrades to watch as well including Ramsay Health Care (ASX:RHC) Graincorp (ASX:GNC), WiseTech (ASX:WTC). Companies cutting costs: McGrath (ASX:MEA), HT&E (ASX:HT1), Southern Cross Media (ASX:SXL). Meanwhile, Dexus (ASX:DXS) forms JV to buy Rialto Towers in Melbourne.
Global equities continue to take a hit as COVID-19 continues to spread. Financials and energy similarly fall. Is there a way forward for investors? Jessica looks at the smart investor's investment strategy and how a little planning, can go a long way.
In this week’s wrap, Jessica covers:
- Around the world in 60 seconds - a look at global equities (0:09)
- Defensive sectors continue to outperform (1:31)
- Fisher & Paykel Healthcare (ASX:FPH) best performing stock YTD (2:23)
- Golden stock tips: insights from Goldman Sachs (2:59)
- IDP Education (ASX:IEL) & CSL (ASX:CSL) in the buy-zone (4:29)
- 'Quality' & outperforming listed products to consider (5:33)
Aussie shares track 1.9% lower after the White House projected 100,000 to 240,000 COVID19 deaths in the U.S. The S&P500 lost 4.4%, but after Wall Street closed, its futures lifted, suggesting a bounce back. The energy sector charges for the second day as oil rises 5%.
IDP Education shares surged 22% after it raises more money than expected and assured investors it’s now adequately funded to navigate the coronavirus uncertain times.
Gold miners like Evolution Mining and St Barbara lift.
Bell Potter Research updates on Suncorp and Australian Pharmaceutical Industries.
Aussie shares kicked off the month and quarter up 3.4% on Wednesday 1 April at midday. Overnight markets were mixed with US equities down, while European equities made gains, gold fell to US$1,597 an ounce and oil rose 2% with US President Donald Trump and his counterpart, Vladimir Putin set to hold talks to stabilise energy markets.
All eyes on: Oil Search (ASX:OSH) up 18% as a Japanese fund manager increased their stake in the firm. Macquarie dropped its target price to $4.00, (It's trading around $2.81). Scentre Group (ASX:SGC) another stand-out, up 12% on securing extra funding to boost its liquidity position to $3.1 billion, while it announced it has $2.5b in bonds, plus other bank facilities maturing, which will help it navigate Coronavirus (COVID19)
Investors absorb better than expected economic data: Australian manufacturing data for March, taking the industry out of the contraction phase amid frenzy stockpiling. Plus building approvals were also better than expected in February, with VIC unit approvals surging.
Bell Potter Upgrades: Agribusiness Elders (ASX:ELD) reiterated as a buy. And Upgraded Johns Lyng Group (ASX:JLG) to a buy as its construction is listed as an “essential service”, company bookings lift.
The Aussie share market is having another positive day, rising 3.1% in the first 40 mins following yesterday’s 7% gain, best one day gain since 1980.
We also had positive leads from the get go. Wall Street started its trading week on positive ground, with the benchmark S&P500 up 3.4%.
Investors will be watching Credit Cord (ASX:CCP), Star Entertainment (ASX:SGR) and Nine Entertainment (ASX:NEC).
In February 2020, unemployment was low, and the share market was at an all-time high. Since then, we've seen the Aussie share market fall 30% from it's peak. Unsurprisingly in this risk off environment, defensive sectors are outperforming.
In this month's wrap, Jessica covers:
- Metcash (ASX:MTS) – cashes in on panic buying as top performing stock of the month (1:03)
- Can the past teach us something about the future? (1:45)
- What the data says – markets predicted to rebound next year (2:48)
- Using Bell Direct’s Strategy Builder tool to pick your next stock (4:06)
- Dollar cost-averaging investing strategy (5:14)
As the Aussie share market picks back up, global equities are expected to follow. However, we aren't out of the woods yet given the persistent pressure from travel bans and other precautionary measures.
In this week's wrap, Jessica covers:
- Stocks in the spotlight - Afterpay (ASX:APT) up 56% (0:40)
- Where are we headed? Global productivity down, but government stimuluses are picking up the pieces (1:41)
- Where to find the most upside (3:56)
- Healthcare stocks to watch (5:25)
- How to find 'quality' ETFs (7:35)
The futures are suggesting a small bounce of 0.87% or 39 points for the Aussie share market, even as the COVID-19 pandemic continues to spread.
We saw tens of thousands of out-of-work Australians try to claim unemployment benefits, causing lines hundreds of metres long at physical Centrelink locations and for the MyGov website to crash.
ASX-listed medical equipment maker, ResMed (ASX:RMD) have said they are looking to “double or triple” its output of ventilators, and scale up ventilation mask production more than tenfold, as the world scrambles to fight coronavirus.
Nick Scali (ASX:NCK) and baby furniture and equipment chain Baby Bunting (ASX:BBN) have reported positive sales momentum to date and a pickup in activity by Chinese suppliers.
On the flipside, jewellery retailer Michael Hill (ASX:MHJ) has decided to postpone its 1.5 cents per share interim dividend for six months.
The Aussie dollar buys 57 US cents.
The Aussie share market futures are suggesting a fall at the open of around 1.81%, despite the Prime Minister and Treasurer yesterday unveiling $66bn worth of measures to help cushion the blow from COVID-19.
Last night, Prime Minister Scott Morrison announced the drastic steps that will be taken in a bid to stop the spread of COVID-19. Pubs, clubs, cinemas, churches, places of worship and indoor sporting venues including gyms, will be shut down from midday today. While, restaurants and cafes would only be open for takeaway. As for schools, he said children ‘should go to school today' and that there was ‘no change’ to the health advice from authorities. He said parents who were concerned, have the right to keep their children at home.
US, stocks tried to rally on Friday, but weren’t successful, as we saw Wall Street end its most volatile week since 2008.
All eyes on Beach Energy (ASX:BPT), Woodside Petroleum (ASX:WPL), Newcrest Mining (ASX:NCM), St Barbara (ASX:SBM) and AP Eagers (ASX:APE).
As global borders shut down, companies are abandoning their earnings forecasts. Why? It seems people are coming to terms with the fact that COVID-19 could be around for a while. Governments and central banks meanwhile, attempt to combat the economic downturn.
In this week's wrap, Jessica covers:
- ASX down 28% YTD (0:42)
- Fisher & Paykel Healthcare sees boost amidst COVID-19 (1:21)
- Supermarkets projected by UBS to lift (1:49)
- Containing the blaze: the parts of the market most affected (2:32)
- A few ideas from Morningstar (4:00)
- Some ways to think about diversification (5:35)
The Aussie share market gained 2.7% in the first hour of trade and at around 1pm was sitting 4.4% higher. This was fuelled by a rally on overseas equities after Donald Trump signed a bill that expands paid leave for workers amid the coronavirus lockdowns, inking a stimulus package potentially worth US$1 trillion. We also saw the oil (WTI) price gaining 23%, its biggest one-day move ever.
Stand out stocks include Afterpay (ASX:APT), Cimic (ASX:CIM), Scentre (ASX:SCG), Mirvac (ASX:MGR), Goodman Group (ASX:GMG) and Corporate Travel Management (ASX:CTD).
The Aussie share market gained 2.6% in the first 30 minutes of trade, (but is now tracking 0.5% lower) fuelled by positive news in Europe as the European Central Bank (ECB) just launched a $750 billion stimulus package. Secondly- the market is rallying ahead of the Reserve Bank of Australia’s 2.30pm decision, with rates expected to be cut to 0.25%. Finally, for quantitative easing to be introduced - to inject new money into the economy to support businesses.
The only sector in the red earlier was the energy sector- as the oil price fell to a new 18- year low of US$22.45. Pressure remains on travel related stocks like Flight Centre (ASX:FLT) down 20%, and Corporate Travel Management (CTD) down 16% with Qantas stooping international flights later this month.
The Aussie dollar also hit a new 17 year low, 57.87 US cents. That’s where it last traded in January 2003. It’s bad for importers and great for our exporters.
Today, the Australian PM banned international travel and indoor gatherings of 100 people. He also called upon the stockpiling behavior to stop.
Yesterday, we heard that the Australian government pledged $715 million to support our airliners via refunds and waivers with $159 million of that being an upfront benefit. We also heard from some states and territories as to how they will support the workforce, which is why the Aussie share market gained 5.8%.
All eyes are on Virgin (ASX:VAH), Ramsay Health (ASX:RHC), Aristocrat Leisure (ASX:ALL), Mirvac (ASX:MGR) and Afterpay (ASX:APT).
More government stimulus is being planned in the U.S to combat coronavirus, with Trump weighing up a $1 trillion stimulus package that includes cash payments, support for small business and the airlines. The news helped the US benchmark indices take back half of what they lost from the day before.
Yesterday the ASX200 shed 9.7%, which wiped off the 4.4% Friday gain. It was also the market's biggest loss since 1987.
Countries are closing their borders and stocks continue to fall with Trump's words causing some Airlines bounce.
All eyes on Coca-Cola (ASX:CCL), Estia Health (ASX:EHE), New Zealand King Salmon (ASX:NZK), Cochlear (ASX:COH) and BHP (ASX:BHP).
Pressure is on the RBA to cut rates. After the US Central bank cut rates to zero, also launching a US$700 billion quantitative easing program, to offset the coronavirus economic impact. Meanwhile the Central NZ bank has cut its rate to 0.25%.
All eyes on Fortescue Metals (ASX:FMG), Challenger (ASX:CCF), Reject Shop (ASX:TRS), oOH!media (ASX:OML), Air New Zealand (ASX:AIZ), Downer (ASX:DOW), Dominos (ASX:DMP) and Crown Resorts (ASX:CWN).
A 20% fall from all-time highs puts the ASX back into a bearish hibernation. Given travel and tourism account for 15% of world GDP, it's no surprise that the COVID-19 pandemic is creating severe market dislocation.
The estimates however tell a different story; if corona can be contained, Australia may just avoid a technical recession.
In this week's wrap, Jessica covers:
- No need to panic - markets will recover (0:40)
- Citi's insights: attractive buys & ASX predictions (2:01)
- Sector sale! Energy's batteries run flat (3:48)
- A word from Buffett (5:38)
Currently the Australian share market is down 2.4%, that’s less than the expected 3.5% drop the futures expected and less than the drops around the world. The S&P500 in the US lost about 4.9%. While the oil price fell 4.8% as Saudi Aramco asked to raise output capacity.
In terms of the ASX sectors, the sectors that are outperforming the market are the staples, financials, telcos and IT. There are pockets of green as bargain hunters snap up stocks, which is why CIMIC (ASX:CIM) is up 2%, Woolworths (ASX:WOW) up 1% and WiseTech Global (ASX:WTC) up 3.4%.
The Australian share market futures are suggesting a 0.6% lift at the open, following the ASX200 rise of 3.1% yesterday.
The oil price has gained 10%, after suffering its sharpest fall since 1991.
All eyes on Webjet (ASX:WEB) and Newcrest Mining (ASX:NCM).
The biggest company in Australia goes ex div, CSL (ASX:CSL), as well as metals and mining company, OZ Minerals (ASX:OZL) and pallet business, Brambles (ASX:BXB).
We saw global equities enter bear markets overnight. US stocks fell 7.6% - its biggest loss since 2008, while European equities lost 7.4% and the Aussie share market shed 7.3% yesterday.
It all comes as oil prices fell 30% after OPEC’s talks failed and Saudi Arabia said it would boost oil production in a bid to increase its supply and market share.
Qantas (QAN) announced it's slashed international flights and roughs, cutting a quarter of international capacity for the next 6 months.
Newcrest Mining (NCM) rose 2.5% yesterday, outperforming the market and looking like it’s turned a corner from its February low.
Finally, the Australian dollar has recovered from its fall yesterday and is now 1.2% higher at 65.87 US Cents.
We saw the Aussie share market traverse through the week, collecting a 0.7% loss Monday-Thursday. Investors topped up on their bond exposure, pushing the 10-year government bond yield to new lows.
We saw blood plasma company, CSL gain 2.4% over the last four days, and also overtake CBA as the biggest company on the market.
In this week's wrap, Jessica covers:
Agri-businesses welcome boost after rains hit Eastern Australian (0:29)
Bega Cheese takes the cake in this week's best and worst (0:53)
Defensive sectors hold firm: Telcos push ahead 3% (1:24)
Where the market is YTD (1:53)
Why a diversified portfolio can cushion market impacts (2:15)
Yesterday the ASX200 fell 1.7% but it looks like we should erase that loss as the Australian share market futures were up 1.8% at the open.
All eyes on: Brambles (ASX:BXB), NEXTDC (ASX:NXT), NAB (ASX:NAB), Newcrest Mining (ASX:NCM) and trade data balance for January.
Global equities markets have rallied with US equities galloping 4% ahead, taking US stocks out of correction territory. Stocks were also boosted as the US services sector grew stronger than expected in February and payrolls also jumped more than forecast in Feb.
In breaking news, the Australian economy grew more than expected in Q4 up 0.5%, more than the 0.3% on the cards – also rising 2.2% year on year. That slightly lifted the market but the ASX200 is tracking 1% lower around noon.
US stocks moved back into the red, when the Fed Reserve made an emergency 0.5% rate cut to 1.25%. It was not expected, which is why their market fell about 3%. And now, US President Trump is also calling for rates to be cut again to make US exports cheaper.
All eyes on goldminers, banks & Nextdc (ASX:NXT).
All eyes are on the RBA today, awaiting that key decision at 2.30pm with the the RBA’s rate indicator tipping rates will be cut to 0.5%.
Overnight US stocks enjoyed their biggest bounce back since 2009 with investors buying the dip. We saw US stocks snap their seven day losing streak with monumental gains being seen across all the indices and oil which gained 6% as Russia pledged to cooperate with OPEC.
Aussie share market futures are suggesting the market will lift 1.1%/57 points. Yesterday the ASX200 lost 0.8% yesterday.
What else? Overnight Bell Potter upgraded Appen (ASX:APX), the machine and AI learning company from a Hold to a Buy, and expect its earnings for 2020 to come in higher than Appens’ forecast. Yesterday Appen closed 7% higher at $22.20.
The ASX loses 6%, the AUD sinks to an 11 year low, and U.S equities fall to a 12 week low as coronavirus pandemic speculation takes hold.
In this month's wrap, Jessica covers:
- Healthcare sector delivers the goods once again (1:25)
- IDP Education (IEL) rises 34% to be this years YTD stock darling (1:51)
- What's next? (4:14)
- Key investment principals to keep in mind during the coronavirus crisis (4:38)
US equities made a comeback overnight and the Nasdaq made green tracks for the first time in days.
The ASX200 closed lower for the 4th straight day losing 2.4%, which took the market back to early January levels and the futures are suggesting a 0.4% drop.
Companies reporting today: Bega Cheese (ASX:BGA), Flight Centre Travel (ASX:FLT), Ramsay Health Care (ASX:RHC), Nextdc (ASX:NXT), Link Administration (ASX:LNK), Adelaide Brighton (ASX:ABC), Costa Group Holdings (ASX:CGC) and Propel Funeral Partners (ASX:PFP).
Famous actor & World Health Organisation Ambassador Jet Li said overnight, coronavirus knows no borders. Coronavirus cases are on the rise in Europe and the middle East, while cases are steadying in China with factories coming back online like Toyota.
There is a lot of fear in markets which is why US equities tumbled to a 12 week low and money flowed into bonds, pushing their treasury yields to a record low.
Companies reporting: Invocare (ASX:IVC), Healius (ASX:HLS), Appen (ASX:APX), Polynovo (ASX:PNV) & Rio Tinto (ASX:RIO).
All eyes are on the world’s leaders, and what they say at the G20 meeting in Saudi Arabia. Finance ministers, along with central bank governors are headed to the country at the weekend to discuss the global economy, trade tensions and the coronavirus.
The Aussie futures are suggesting a 0.7% fall at the open, meaning we could be on for another day of profit taking.
Companies reporting today: Bluescope Steel (ASX:BSL), Cooper Energy (ASX:COE), Helloworld Travel (ASX:HLO), NIB Holdings (ASX:NHF), WorleyParsons (ASX:WOR) and Resolute Mining (ASX:RSG).
All eyes on US manufacturing data for February.
Commodities continue to bounce back from Coronavirus fears. While US equities tracked lower overnight with most of the losses coming in a sudden midday move, leaving traders and investors puzzled as to why US stocks were sold down and gold continued to hit new muli-year highs.
Currently the ASX200 futures are flat, suggesting we will search for direction at the open.
Companies reporting today: Ardent Leisure Group (ASX:ALG), Inghams Group (ASX:ING), Mayne Pharma Group (ASX:MYX), Orocobre (ASX:ORE), Platinum Asset Management (ASX:PTM), Rural Funds Group (ASX:RFF), Senex Energy (ASX:SXY) and Charter Hall Group (CHC).
Wall Street has done it again, hitting another record all time high with tech shares leading the charge after Apple erased its coronavirus losses after downgrading revenue.
The ASX200 futures are suggesting a lift of 0.2%.
Companies reporting today: Coca-Cola Amatil (CCL), Origin Energy (ORG), Perpetual (PPT), Qantas Airways (QAN), Star Entertainment (SGR), Santos (STO), Super Retail Group (SUL), Sydney Airport (SYD) and Galaxy Resources (GXY).
All eyes on Little Green Pharmaceuticals (LGP) and WiseTech Global (WTC).
Wall Street started its trading week mostly lower with the Dow falling for the third straight day, after Apple warned it won’t meet its revenue guidance as coronavirus slowed production and weakened demand in China.
Companies reporting today: Tabcorp (TAH), Crown Resorts (CWN), Domino's Pizza Enterprise (DMP), Fortescue Metals Group (FMG), Wesfarmers (WES) and WiseTech Global (WTC).
All eyes will also be on the wage price index.
We had a quiet session overnight given U.S markets didn’t trade as it was a public holiday for President's Day.
The Aussie shares market futures were 0.04% lower, suggesting a negative open.
Companies reporting today: Abacus Property Group (ABP), Ansell (ANN), APA Group (APA), BHP Group (BHP), Cochlear (COH), Emeco Holdings (EHL), IOOF Holdings (IFL), Monadelphous Group (MND), Netwealth Group (NWL), Oz Minerals (OZL), Scentre Group (SCG), ISelect (ISU), Coles Group (COL) and Sims Metals Management (SGM).
Breaking news: Apple released that it won't meet it's revenue guidance due to coronavirus suppressing supply and demand in China.
U.S stocks had a mostly upbeat session on Friday with the tech heavy Nasdaq closing at a new record high.
The Aussie shares market futures were 0.6% lower, meaning we could have a negative start to the week. On Friday the ASX200 rose 0.4% to 7,130 points, the second highest close on record.
Companies reporting today: Altium (ALU), Bendigo and Adelaide Bank (BEN), Brambles (BXB), GWA Group (GWA), Imdex (IMD) and QBE Insurance Group (QBE).
With positive sentiment now well and truly back in the market in the wake of the initial coronavirus scare, Jess looks back at historical market data from plagues of the past. The Aussie, U.S and European markets once again enjoyed record highs on not one, but two days this week. Could this be the roaring 20's once again?
In this week's video, Jessica covers:
- A retrospective look at disease market impacts - or lack thereof (0:48)
- The review of the century: the relentless ASX (1:03)
- The weekly sectors report: finance is back in black (1:37)
- The stock report: Breville boils its way to the top (1:53)
- Spotlight stocks: AMP, CSL and CBA all upgraded (3:08)
- What to look out for next week (5:37)
U.S investors trimmed profits off the table, which explains why Wall Street hit new record highs overnight, before closing in the red.
The Australian share market futures were flat (at 8.00am).
Companies reporting today: Baby Bunting Group (BBN), IPH (IPH), Mesoblast (MSB) and City Chic Collective (CCX).
All eyes on Goodman Group.
Investors buy the dip and US equities rebound. The Australian share market futures are suggesting a 0.6% gain.
Companies reporting today: Beach Energy (BPT), Challenger (CGF), Suncorp Group (SUN) and Transurban Group (TCL).
All eyes on: Home and investing lending data for December and business confidence for January.
Global equities pushed the pause button on Friday following concerns of the coronavirus' economic impact. In the US, a better than expected jobs report was released with 225,000 jobs added in January, while wages grew 3.1% year on year, also beating forecasts.
Companies reporting today: GPT Group (GPT), Charter Hall Long WALE Reit (CLW), Aurizon Holdings (AZJ) and JB Hi-Fi (JBH).
All eyes on: China inflation data is out for January, home lending data is out tomorrow for December and business confidence for January.
Global equities had a strong rally both overnight and yesterday, with Asia up the most, as China halved the tariffs on $75 billion of US goods, taking effect on February 14.
The Australian share market futures are suggesting a 0.13% gain after the ASX200 gained 1% yesterday.
Companies reporting today: REA Group (REA) and News Corp (NWS).
All eyes on the services sector.
US equites pushed ahead for the third straight day erasing the coronavirus losses, with the S&P500 closing at a brand-new record high.
The Australian share market futures are suggesting a 0.8% gain.
Companies reporting today: Dexus (DXS), Nick Scali (NCK) and Mirvac (MGR).
All eyes on retail sales for December.
Wall street is bouncing back with vengeance, with the tech heavy Nasdaq rising to a brand-new record high overnight. Big tech household names like Microsoft and Apple surged to all-time highs.
The Australian share market futures are suggesting a 0.6% gain after the ASX200 rose 0.4% yesterday.
Reporting season today: Centuria Industrial REIT (CIP), Centuria Metropolitan REIT (CMA), Genworth Mortgage Insurance (GMA) and Service Stream (SSM).
All eyes on RBA Governor speech at the National Press Club and reporting season companies.
Wall Street bounces back with investors seeing the market as a buying opportunity. The Aussie share market is eyeing a flat start.
Reporting season: BWP Trust (BWP) half year results, CIMC Group (CIM) full year, Janus Henderson (JHG) full year, and Shopping Centre Australia (SCP) half year results are out.
Today all eyes are on the RBA’s interest rate decision, reporting season companies and New Home Sales will be released by HIA for December.
The Australian share market is bracing for a heavy round of profit taking following the sharp losses on Wall Street with US equities falling 1.8% on fears the coronavirus could dent economic growth. Most asset classes are lower, bonds yield lower too as more money has flowed into treasuries, while gold has gained.
The Aussie futures suggest a 1.7% fall at the open which means we could fall below the 7,000 mark.
All eyes on the RBA meeting tomorrow and Link (LNK).
The Aussie share market gets the biggest start-of-year adrenalin shot in 3 decades. The ASX holds firm with less unemployment & higher inflation revealed in Australian economic data. The U.S follows suit. Plus; healthcare is up, but the stocks leading the charge aren't those in the eyes of the coronoavirus storm...
In this weeks Wrap, Jess covers:
How was this the best start to the year in 3 decades? (0:16)
The epedemic isn't causing a pandemic in the markets... (2:32)
Best sectors: Healthcare's up in coronavirus' wake (3:53)
Stocks report: Polynovo rides the skin repair wake, Nearmap nearly falls off the grid (4:53)
What can we expect? (5:53)
Wall Street made a massive late comeback, with the blue chip index recovering from its 244 points fall before ending 0.4% higher.
It comes after the World Health Organisation (WHO) declared the coronavirus that's killed 171 and infected 7,832 a global health emergency. The head of the organisation said he gave the declaration as the virus spread to other parts of the world, while he said there was no need to interfere with international trade or travel.
The Aussie share market futures are suggesting a 0.3% lift, after the ASX200 lost 0.3%closing at 7,008 points yesterday.
All eyes on ResMed (RMD), GUD Holdings (GUD) and Infigen Energy (IFN).
Global equities bounce back and the US gets better than expected economic news seeing Wall Street rebound from its worst drop since October.
The Aussie share market futures are suggesting a 0.6% lift, which should see us claw back up from yesterday's biggest loss of the year. Yesterday the ASX200 shaved off 1.4% closing under the 7,000 points for the first time in two weeks at 6,995 points.
All eyes on Treasury Wines Estates (TWE), Evolution Mining (EVN), Oz Minerals (OZL), Regis Resources (RRL) and Australian inflation data.
The Aussie share market futures are suggesting a 1.2% fall. Yesterday the market was closed for Australia day, while on Friday the benchmark index ASX200 closed flat, only gaining 0.4% on the week.
Global equity investors took profits off the table and flighted to traditional safe haven assets like gold and bonds, as the Coronavirus intensified. The death toll in China rose by 63 people since Friday, to 81 today, with 461 in a critical conditions and over 2,800 more cases globally, including in the US, France, Canada and here in Australia. Heavy selling in global markets was fueled by the uncertainty, particularly as China is the biggest driver of global growth.
All eyes on Auckland International Airport (AIA), Credit Corp (CCP) and Oil Search (OSH).