ASX 200 up 29 points to 7490 (0.4%).

• HIGH 7496 LOW 7463– Narrow range, lacklustre trade.

MAJOR MOVERS:

Winners: ZEL, VUL, PLS, CTT, INR, MCR, IMU

Losers: NHF, RBL, HUM, TPG, GEM, ALD, OML

• POSITIVE SECTORS: Tech. Healthcare. REITs
• NEGATIVE SECTORS: Telcos. Insurers
• BIG BANK BASKET: Grinding higher at $181.66
• ALL -TECH INDEX: Up 1.7% APT up 2.7%
• GOLD: Slips slightly to AUD $2495
• BITCOIN: US$50285 Kicks higher
• AUD: Firms to 71.58c
• 10-YEAR YIELD: Rallies to 1.09%
• ASIAN MARKETS: Tokyo up 1.83%, Hong Kong up 1.31%, China up 1.33%
• US FUTURES: Dow futures up 150. NASDAQ up 51

ASX 200 rallies 29 points to 7490 (0.4%) as a few bargain hunters appear despite NSW hitting high case numbers again. A bit of a mixed session with results and research in focus, NHF fell 11.0% after its CV19 affected results, GEM too in the doghouse on occupancy worries, down 5.7%, ALD bid for ZEL and dropped 4.8% whilst PGL rallied 14.6% on its numbers. Banks were better with the Big Bank Basket at $181.66 with iron ore miners continuing to see sellers, FMG down 4.3% and RIO off 0.5%. Base metal miners fared slightly better, S32 up 2.2% and PLS up 11.4% leading the lithium charge. Industrials were mixed with tech showing gains led by APT up 2.7%.

STOCKS ON THE MOVE

• ZEL +14.53% ALD takeover bid.
• VUL +13.80% BNP Paribas helping with DFS.
• PLS +11.39% no longer depressed.
• MCR +9.68% good drill results.
• DEG +6.85% buyers are back.
• SKO +8.03% low volume but trading update.
• NHF -11.03% results and CV19 impacts.
• SYA -4.00% SPP well supported.
• GEM -5.71% results underwhelm.
• HUM -6.22% rattled.
• RF1 -3.03% NTA unchanged at 343c.
• TWE -3.41% profit taking.
• SUL -4.62% ex dividend.
• TPG -5.78% broker commentary.
• ZEO -16.10% ASX please explain.
• AXE +19.76% bounce back.
• KLL +10.81% rethink on Beyondie SOP.
• COD +11.71% high grade assays confirm Bornite zone at Emmie Bluff.
• CWY -1.88% broker downgrades.
• Speculative Stock of the Day: IDT +24.55% more to say on MIPS mRNA vaccine candidate and readiness agreement with Government.

ANNOUNCEMENTS

• Reliance Worldwide (RWC) -1.52% reports FY underlying NPAT $211.9m versus expectations of $192.6m – based on eight estimates with a range of $183-200m. Revenue came in at $1.34bn, whilst adjusted came in at $349.2m – both ahead of expectations. Reported NPAT was $188.2m and the company declared a final dividend of 7cps (franked to 20%). That brings total divs for the year to 13cps. With regard to the outlook, the company noted that managing costs and supply chain issues will prove challenging, but that they will be able to pass prices on. In that vein, average prices in FY22 are forecast to be 6% higher than FY2021.
• Michael Hill (MHJ) +1.82% reports FY Statutory NPAT of $45.3m, well up on the $3.1m reported a year ago. Consensus NPAT was around $49m however, so it looks slightly short of expectations. Revenue came in at $556.5m vs expectations of $552.8m. Same-store sales grew 8.6% y/y. The company will pay a final dividend of 3cps.
• Latitude Group Holdings (LFS) +3.00% First half cash profit $120.9m vs year-ago $66.7m.Net interest income $400.9m vs year-ago $471.9m. Volume $3.64bn vs year-ago $3.45bn. ROE 19.1% vs year-ago 18.2%. H1 dividend 7.85cps. Expects 60-70% payout ratio for H2 around ~7.85cps. Latitude anticipates spending will recover quickly once restrictions are eased from lockdowns in AUS & NZ.
• Lynas Rare Earths (LYC) +3.48% Update on Malaysian operations; regulator extends operating license conditions deadline to March 2, 2022.
• Audinate Group (AD8) +0.48% Full-year EBITDA $3m vs consensus $2.8m. Revenue $33.4m vs consensus $33.4m as per July 8 preannounce. R&D expense $10.7m vs year-ago $9.1m. Observes a record backlog of sales orders for future months. Strong July result but Malaysia factory closure pushed fulfilment of some orders to future months. Good trading conditions were experienced during the start of FY22. COVID related risks now relate to global supply chain uncertainty and are impacting both Audinate and our customers in 1H22.
• PSC Insurance Group (PSI) +9.52% Full-year underlying EBITDA $72.0m vs guidance $68-73m. Revenue $224.6m vs year-ago $169.0m and consensus $207.8m. Full-year dividend 6.5cps. FY22 guidance: Expects underlying EBITDA $84-89m and underlying NPATA $54-58m.
• G8 Education (GEM) –5.71%First-half statutory profit $25.1m vs consensus $15.2m.Revenue $421.5m vs consensus $419.6m. Operating EBIT ex-items $38.9m vs consensus $44.4m. National Occupancy 68.0% vs year-ago 65.1%. COVID-related movement restrictions continue to impact revenue with $1.9m of fees waived in H1 to support families and retain enrolments. Net earnings impact was also not material in July 2021, with downside risk to earnings from August onwards, in light of tightening restrictions. Dividend payments are expected to recommence with a full-year CY21 dividend intended to be paid in CY22.
• Prospa Group (PGL) +14.57% Full-year profit -$9.5m vs year-ago -$24.9m and consensus –$9.1m. Revenue $117.7m vs year-ago $142.1m and consensus $117.6m. Originations $483.7m vs year-ago $447.5m. Total Impairment expense $27.3m vs year-ago $52.9m.
• Chorus (CNU) -2.92% has delivered FY EBITDA NZ$649m against expectations of NZ$644.6m – based on five estimates with a range of NZ$639-653m. NPAT came in at NZ$47m, short of expectations of NZ$49.4m. Revenue slightly beat, coming in at NZ$947m. The company declared a fully imputed final dividend of 14.5 cps, bringing the total for FY21 to 25 cps. CNU also announced FY guidance of EBITDA in the NZ$640-660m range, and FY22 initial dividend guidance of 26 cps.
• Charter Hall Group (CHC) +6.49% Full-year operating EPS $0.61 vs consensus $0.58. NTA per stapled security $4.91 vs year-ago $4.28. FY21 Distributions of 37.9cps. FY22 guidance: post-tax operating earnings per security of no less than 75.0cps. Distribution per security guidance is for 6% growth over FY21.
• Sonic Healthcare (SHL) -2.76% Full-year adjusted EBITDA $2.56bn vs consensus $2.59bn. Revenue $8.75bn vs consensus $8.95bn. Final dividend 55cps, 35.75cps franked. Not providing earnings guidance for FY2022 due to COVID-19 related unpredictability. The pandemic has the potential to cause fluctuations in both COVID-19 testing revenues and the base business, although the base business has become increasingly resilient to the impacts of pandemic waves. The underlying growth drivers for healthcare services remain unchanged. COVID-19 Delta variant is currently driving increases in COVID-19 testing revenues.
• Cooper Energy (COE) -2.44% Full-year underlying profit -$25.9m vs consensus -$18.7m. Revenue $131.7m vs year-ago $78.1m. Operating cash flow $8.1m vs year-ago $48.1m. FY22 guidance; expects underlying EBITDAX $60-70m vs FY21 $30.0m.

ECONOMIC NEWS/ BOND MARKETS

• An independent review on last years’ ASX outage has found “several key shortcomings in the project.” ASIC and the RBA have said that the trading system ‘was not ready to go live’. Back on November 16^th the ASX only managed to open for 30 minutes before crashing to a halt. The ASX said sorry and would sort out the issues in the recommendation.
• At the end of last week, 54% of ASX 200 companies had reported their results with just 35% of those providing clarity around their outlook, according to Morgan Stanley. The broker also suggested that the rally is losing steam and may be running into headwinds. Supply chain and freight costs have been consistently called out in industrial outlooks in results according to MS.

ECONOMIC DATA

• Nothing today.

CV19 NEWS

• New Zealand reported 35 new cases in the community. NSW has 818 new cases.
• US reports 1,000 deaths a day over the weekend. First time since March.

ASIAN MARKETS

• It’s all about ‘common prosperity’ as Xi Jinping talks more and more on the subject.

• China hits zero cases after one month of a harsh lockdown.
• The Hang Seng Tech Index climbed as much as 4.5%, the biggest jump since July, after a torrid week last week with an almost 11% fall.

• Kamala Harris touches down in Asia.
• LG Chem drops 11.1% on GM Volt recall as it plans to penalise LG.

US AND EUROPEAN NEWS

• European futures pointing to a solid 0.7% plus open.
• BoJO is hoping to hold G7 talks on Afghanistan. Invites China and Russia. Now G9.
• Biden pledges to evacuate every American trying to get out of Afghanistan.

And finally…

Clarence

“I hear voices. But I ignore them and just carry on killing.”

Interesting fact: a shark will only attack you if you’re wet.

Jimmy Carr: “If you could change one thing about yourself, what would it be? Sean Lock: “Well, obviously the front.”

XXX