The ASX 200 rose 11 points to 7296 (+0.2%) as results dominated on Super Thursday. US futures soft at close on Ukraine rumours, sparking some selling. Bank once again feeling the love with the Big Bank Basket rising to $181.37 (+0.4%) with CBA up 0.2% and WBC doing well up 0.9%. Other financials flat with CGF a winner post results rising 6.7%. Healthcare saw a bump as brokers warmed to CSL with another 5.1% rise. Industrials were mixed, WES down heavily on results, TCL better on traffic outlook. TAH doing well with a 4.1% rise on its numbers and TLS easing 4.2% on numbers. Miners were slightly better with iron ore stocks leading the way, BHP rose 1.4%, RIO up 1.2% and S32 beating expectations and up 1.1%. Energy mixed, WPL up 4.1% on its numbers but STO falling 1.7%. BPT rallied 1.7% after a down day yesterday. Lithium stocks a little depressed as Tesla effect wears off, PLS down 5.5% and LTR falling 5.2%. Gold miners better in spots, NCM up 1.5% and NST up 4.4% on numbers. Tech on the nose again, SQ2 down 6.4%, XRO off 3.0% and WTC falling 3.70%. The AllTech Index dropped 2.3%. In corporate news, plenty around with CUP falling 15.3% on a sudden loss of CEO/MD. On the economic front, better jobs numbers but still with a 4 in front with the headline rate at 4.2%. Asian markets mixed. 10-year yields ease to 2.19%.


End of Day Podcast – Thursday, February 17


Headlines

  • Winners: NWH, IPH, JDO, SYA, CGF, URW, CSL.
  • Losers: WES, CTT, RNU, INR, SQ2, DHG, NVX, PME.
  • Positive sectors: Banks. Iron ore. Gold miners.
  • Negative sectors: Tech. Industrials.
  • High 7357 Low 7282
  • Reports from Europe that Ukrainian rebels are being attacked with mortars.
  • European futures pointing to a 0.5% loss across markets.
  • Big Bank Basket: Rises to $181.37 (+0.4%)
  • All-Tech index: Down 2.2%
  • Gold: Rises to $2610
  • Bitcoin: Falls to US$43665
  • Aussie Dollar:  Rises to 71.80c
  • 10-Year Yield: Eases to 2.19%
  • Asian markets mixed Japan down 0.8%, China steady and HK down 0.7%
  • US Futures: Dow down 107 Nasdaq down 70

Stocks on the Move

  • NWH +15.36% results cheer.
  • IPH +9.19% results and presentation.
  • EBO +4.08% low volume move.
  • SGM +3.01% broker upgrades.
  • GL1 +11.36% appoints head of geology.
  • MAD +7.34% charms becoming apparent.
  • LRK +4.17% same CEO as yesterday. Some stability. Drink to that.
  • WES -7.48% biggest one day loss since the last one.
  • CTT -7.72% Shopify results weigh?
  • DHG -6.22% results weigh.
  • SQ2 -6.40% Block falls in US.
  • DUB -5.93% tech fallout.
  • CUP -15.34% change of CEO and MD. Suddenly.
  • CRR -10.00% placement.
  • IRI -9.23% half yearly results.
  • AXE -5.56% falls.
  • BCB -13.04% placement.
  • Speculative stock of the Day: Bulletin Resources (BNR) +56.52% good volume on high grade lithium mineralisation at Ravensthorpe. Up to 8.21% Li2O in rock chips from Big pegmatite. The strike extent of the Eastern Pegmatite Trend is 4km and remains unexplored and open to the north.

In the News

  • Origin (ORG) – $131m loss for H1 (v loss $183m). Revenue up 7%. “Economic disruptions” from COVID plus “challenging conditions in the electricity market, subdued demand and lower tariffs” to blame for the result. Dividend unchanged 12.5c. 2022 EBITDA guidance upgraded from $$1,850-2,150m to $1,950–2,250m.
  • The Star Group (SGR) – Omicron peaked in January – revenue up 7% in first six weeks of this year. H1 revenue down 23% – made a loss. No dividend.
  • Challenger (CGF) – Revenue up 15.5%. Net profit up 26.6%. Assets under management up 20%. Life sales up 44%. Company describes the results as “strong”. Dividend 11.5c up 21%. 
  • Tabcorp (TAH) – Profit down 5.5% on revenue up 2.2%. Dividend down 13%. Another COVID recovery play – “was significantly impacted by the retail lockdowns imposed in NSW and Victoria”. Conditions “improved once restrictions were lifted”.
  • South32 (S32) – Revenue up 32%. Profit up 10x. Dividend US 8.7c up from 1.4c. Capital management program increased. The yield will be over 6% this year.
  • Telstra Corp. (TLS) – first-half underlying EBITDA of $3.47bn missed consensus of $3.58bn. Management said the benefits from its T22 strategy are starting to show. The result reflected the second consecutive half of underlying growth. The ‘strong’ underlying result according to management reflected the pleasing execution of its T25 strategy so far.  Revenue of $10.89bn missed consensus $10.96bn. Fully franked interim dividend of 8c maintained, comprising a 6c ordinary and 2c special dividend. The $1.35bn buyback is expected to be completed this financial year. TLS reaffirmed guidance that was repeated in October last year. Sees underlying EBITDA between $7.0-7.3bn in FY22.
  • Wesfarmers (WES) – first-half underlying profit $1.21bn in line with consensus. The results had been slightly de-risked by January’s trading update. Disappointment from Kmart and Office word had been somewhat foreshadowed with the market expecting COVID related pressure to normalise in FY23. Revenue $17.76bn ahead of consensus of $17.37bn. Interim dividend of 80c down 9% from last year and slightly missed consensus of 83c. Retail conditions were hit in January with Omicron weighing on customer traffic and labour availability.
  • Transurban Group (TCL) – first half proportional EBITDA $805m vs year-ago $840m. Interim distribution of 15c in line with a year-ago 15c. COVID lockdowns in Melbourne and Sydney have weighed.
  • Woodside (WPL) – final dividend of $US1.05 a share after full-year net profit more than doubled to $US1.98bn ($2.75bn) and operating revenue increased 93% to $US6.96bn.
  • Origin Energy (ORG) – is bringing forward the closure of its only coal-fired power plant by seven years to 2025.
  • NRW Holdings (NWH) – upgraded earnings for the full-year to EBITA of $150m to $155mand kept revenue guidance at $2.4bn to $2.5bn.
  • MA Financial (MAF) – posted a full year dividend up 70% to 17c on earnings a share, up 21c to 22.3c for calendar year 2021. It reaffirmed guidance for underlying earnings a share to climb 10% in 2022.
  • Monash IVF (MVF) – increased its interim dividend despite reporting a fall in its net profit during the first half of the 2022 financial year. The company’s revenue rose 11.2% to $101m, while EBIT dipped 20.8% to $17.9m and profit slid 17.5% to $12.1m. Interim dividend to 2.2c up from 2.1c.
  • Codan (CDA) – best ever profits of $50.1m NPAT. Dividend of 13c up 24%.
  • Crown Resorts (CWN) – 34% growth in revenues to $778.6m with losses blowing out from $120m to $196.3m.
  • South32 (S32) – upped its capital management program, it will now return $US302m to shareholders by September 2. The miner increased the overall size of the program by $US110m to $US2.1bn. Dividend of US8.7¢ fully franked.
  • Beacon Lighting (BLX) – first-half revenue was flat at $151.3m. Dividend of 4.3¢ fully franked.
  • Whitehaven Coal (WHC) – revenues rose 106% to $1.4bn. $340.5m profit for the period compared to a $94.5m loss a year ago. Achieved a coal price of $202 a tonne for the period, a $121 increase from the $81 a tonne in the same period last year.
  • AUSTRAC tells Bell Financial Group (BFG) of potential AML/CTF compliance breaches.

Economic News/Bond Markets 

  • Labour force for January – The economy added up 12,900, CBA had expectations for 45k jobs to be added. Participation rate was 66.2% vs consensus 66.1%. Unemployment rate steady at 4.2%, in line with estimates. Forward indicators of the labour market remain very strong job advertisements up 4.4% in January 2022 to stand at 259,000, according to the National Skills Commission.
  • Hours worked plummeted 8.8%. About 100,000 people usually take a whole week of sick leave in January; this year, the figure was 450,000, or 3.4% of all employed people.
  • NSW and Victoria remove pretty much all CV19 restrictions.
  • ANZ has upped its house price forecast for Brisbane by 7% to 16%, close to double its earlier forecasts. The bank also upped Adelaide’s growth expectations by nearly four times to 11%. Sydney prices received a 3% upward revision to 9% although Melbourne prices were revised lower to 5% from 7%. National prices are expected to improve 8% overall.
  • $80m Lotto tonight. May not be in tomorrow.

Winter Olympics

Asian Markets

  • Singapore reaffirmed its 2022 economic growth forecast. GDP is projected to expand 3% to 5% this year. It also upgraded 2021 growth to 7.6%, from an earlier 7.2%.

US and European News

  • European futures pointing to a 0.5% loss across markets.
  • Short bets against ARK jumped to a fresh record of 11.4% of shares outstanding this week, according to data from IHS Markit. The Tuttle Capital Short Innovation ETF (SARK), which delivers the inverse of ARK’s performance, now has more than $US300m in assets.
  • Apple shareholders urged to vote against Cook’s package.
  • Volatility on US Treasuries at highest since March 2020.
  • Heineken CEO warns that inflation is ‘off the charts’.

And finally…

When your girlfriend comes home in a white suit, covered in bee stings and smelling of honey……

You know she’s a keeper.

Clarence

XXXX