ASX 200 continued to push higher in quiet trade finishing up 42 points at 7181 (+0.6%). Coordinated positivity in banks and resources saw the index close in on the 7200 level. The Big Bank Basket topped $187.10 (0.5%) with CBA close to an all-time high. NAB in favour, too up 0.5%, with QBE better by 2.7% on broker upgrades. MQG missed the memo down 0.9% with MFG up 0.4%. Healthcare better as CSL up 0.1% and FPH rising 2.5%. REITs did well too, GMG up 0.2%, SCG up 1.4% and VCX rising 0.8% despite recent CEO woes. Industrials firm but unspectacular. Tech is stuck in the slow lane, with the All Tech Index up 0.3%. Resources, though, were back in demand despite more CV19 cases in China. BHP rose 1.2%, RIO up 1.0% and MIN doing well up 2.8%. Lithium stocks were firm but again unspectacular, PLS up 3.4% and LTR roaring 2.5% better. Energy stocks though in demand with WDS going great, guns up 2.9% and coal stocks rallying hard on higher coal prices. WHC up 7.8% and NHC up 7.3%. Gold miners were uneventful. In corporate news, TNE rose 5.1% on some impressive numbers, VUK up 10.6% on results and buy back updates, AXE chopping higher on qubit news, up 21.8%. BST was worse with its AGM update falling 13.6% and 360 returned from a capital raising falling close to the placement price of 630c. Nothing on the economic front, Phil Lowe speaks tonight his specialist subject. How to forecast inflation and interest rates correctly. Meanwhile, Asian markets mixed on CV news, Japan up 0.7% HK down 0.4% and China up 0.8%. 10 -year yields are steady at 3.60%. Dow Futures up 11 points. NASDAQ Futures up 12 points.
- Winners: VUK, A11, WHC, NHC, YAL, TNE, RNU
- Losers: CTT, 360, SHV, AD8, A4N, SDR, ZIP, JIN
- Positive sectors: Banks. Iron ore. Lithium. Oil and gas. Coal.
- Negative sectors: Staples.
- High 7194 Low 7149 Narrow trading range. Thin volumes.
- Big Bank Basket: Closed up at $187.10(+0.5%)
- All-Tech index: Up 0.3%
- Gold better at $2637
- Bitcoin: Falls to US$15,830
- Aussie Dollar: Lower at 66.13c
- 10-Year Yield: Steady at 3.60%
- Asian markets: Japan up 1.2% HK down 0.7% and China up 0.8%
- US Futures: Dow up 11 Nasdaq up 12
- VUK +10.63% results and share buyback extension.
- WHC +7.81% NHC +7.25% coal prices higher.
- TNE +5.10% great results again.
- AUT +7.41% bonanza hits
- AXE +21.54% more good news on qubits.
- LRS +17.39% was written up a few days ago in the newsletter.
- GLN +6.23% strong flow rate.
- KAR -1.71% oil price weakness.
- SHV -4.63% results underwhelm.
- CTT -5.63% change of directors’ interest.
- 360 -5.35% placement at 630c.
- BST -13.60% worse and worse.
- IVZ -11.94% no new news.
- AVH -5.83% presents at a healthcare conference. PNV cap raise.
- SQ2 -3.22% crypto weakness.
- Speculative Stock of the Day: Besra Gold (BEZ) +47.50% exceptional high grade and bonanza grade intercepts at Bekajang. Indicates a significant ‘understory’ of mineral endowment. Honourable mention to NYM +12.90% on high grade intercepts at Rocky Gully REE prospect.
IN THE NEWS
- Select Harvests (SHV) Operations NPAT of $6.2m below consensus of $9.2m. The company noted a challenging year with lower-than-average almond pricing and severe weather conditions. The company forecasts a return to normal trading conditions in FY23.
- TechnologyOne (TNE) – Reported profit for the year with a 22% increase. SaaS annual recurring revenue also increased, by 43%, which the company has said “exceeded” targets. TNE has announced a special dividend of 2c as well as the final dividend of 1082c.
- Best & Less Group (BST) – Has provided an H1 trading update with like-for-like sales decreasing 7.7% year on year, while total sales have increased 22.8%. The company has also noted that there was a moderation in sales growth for the period with supply chain issues and a delayed start to summer weather. Outlook for the next half year looks much more favourable with the previous deferred sales expected to flow through and benefit the coming period.
- Macquarie Telecom Group (MAC) – Has reaffirmed guidance at AGM. Reported an 8.5% increase in revenue from the previous year.
- Telix Pharmaceuticals Limited (TLX) –announces that the first patient has been dosed in a study for glioblastoma therapy.
- Bapcor (BAP) – Provided an update at business investor day, with the outlook of positive market momentum and both trade and wholesale markets seeing robust growth. With only a temporary compression of margins and input costs increase.
- Life360 Inc (360) – Life360 announces the completion of an institutional placement for new Life360 CDIs to institutional investors to raise ~$50M. The placement was fully underwritten and will result in ~7.9M new CDIs being issued at $6.30 AUD.
- Jervois Global Limited (JRV) – Jervois Global Ltd announces they will receive A$0.5M funding from NSW Government to “advance testwork associated with underpinning a BFS for its 100%-owned Nico Young nickelcobalt project under the NSW Critical Minerals and High-Tech Metals Activation Fund, Stream 1”.
- IVE Group Limited (IGL) – IVE Group LTD provides a trading update at AGM and reconfirms FY23 guidance. Revenue momentum from FY22 and post-lockdown recovery has continued into the current year, with EBITA, NPAT & revenue all up year on year. Guidance provided on August 25, 2022, reconfirmed; EBITA A$105M, NPAT A$36M, and Capex A$14M.
- The Star Entertainment Group Limited (SGR) – The Star Entertainment Group Ltd provides YTD trading update at AGM. Gold Cost revenue up 32% on pre-COVID levels, Brisbane revenue up 9%, and Sydney revenue down 11%. Gearing at 2.7 times with undrawn facilities and cash reserves at $547m.
- Playside Studios (PLY) – Has announced a game development partnership with Meta Platforms (META.NASDAQ). The partnership is to develop and create a mixed-reality interactive software product.
- Calix (CXL) – In a trading halt as it looks like CEMEX has jumped the gun on a contract with CXL.
- Bluescope (BSL) – at the AGM the CEO said some “customer hesitancy” is showing up as distributors start cutting back the level of inventory they are carrying in the Australasian market as economic conditions tighten.
- Archer Materials (AXE) – announced that supercomputers have validated its CQ qubut material uniqueness.
- Speech by Philip Lowe, Governor – Price Stability, the Supply Side and Prosperity – at the 2022 Annual CEDA Dinner – Melbourne.
- New Zealand’s central bank is poised to raise interest rates by an unprecedented 75bps, accelerating its monetary tightening to get inflation under control.
- Looks like there has been a deal reached to subsidise EVs with tax breaks for plug ins as well as EVs.
- In China, there were 27,307 new cases recorded for Monday, just shy of the previous record 28,973 reached in April.
- The southern manufacturing hub of Guangzhou remains the epicentre of the current wave, reporting the bulk of the 8,588 infections in the broader Guangdong province.
US AND EUROPEAN HEADLINES
- Crypto brokerage Genesis warned of the risk of bankruptcy amid contagion from the rapid demise of Sam Bankman-Fried’s FTX empire. Coinbase has lost over a quarter of its value in the past four trading sessions as investors fear more fallout from FTX’s collapse.
- Sunak rules out Swiss-style trade deal with EU.
- Two Estonians accused of US$575mn crypto fraud.
- Goldman Sachs says West could end reliance on Chinese battery makers by 2030.
- Return of the Jedi at Disney with Bob Iger back in the Falcon.