Monday 3rd April – Australian Market Wrap | Beeks Downunder-Because not all financial news is boring!

ASX 200 closes up 45 points to 7223 (+0.6%) continuing on from last week’s rally. The energy sector led the market today, KAR up 6.5% after announcing production issues at Bauna and maintenence brought forward, WDS +2.7%, STO +2.5%, and BPT healthy +3.5%. Base Metals and Gold worst performers today, gold miners lagging NCM, AGG, and NST all off 1.8%, 0.4%, and 1.1%, respectively. Banks did well again today, TheBig Bank Basket up to $172.29 (+1%). CBA strong +1%, ANZ also in demand up 1.3%, WBC up 1.1% after completing the merger of BT’s personal and corporate super funds with Mercer Super Trust. Insurers mixed, QBE off 0.3%, while SUN better up 0.8%. Tech doing ok, All-Tech Index up 1.2%. WTC up 2.3%, XRO finding some support up 1.5%. Healthcare firm and defensives generally improved, CSL up 0.9%, and IMU flat. Lithium stocks took a hit, PLS off 3.6%, AKE slid 0.9%, and CXO down 1.7%. In corporate news, SHL up 0.8% after agreeing to buy Dianosticum for $307.9m, LKE surged 7.9% after reporting its DLE technology has produced lithium carbonate purity grades greater than 99.8%, NWL tumbled 7.5% on news FUA increased in March quarter but down $300 on pcp. On the economic front, the focus is on the RBA’s interest rate decision tomorrow at 2:30pm, hold seems to be the consensus then one more 25bps rate hike later this year. Asian markets are mixed, China up 0.5%, HK off 0.7%, and Japan up 0.7 %. 10-year yields down a touch to 3.3%. Dow futures up 5 points and Nasdaq futures falls 88 points.

HEADLINES

Winners: TYR, LKE, CTT, KAR, HGH, BOE, CTD, CXL
Losers: NWL, PMS, TER, SYR, BGL, RRL, AGY
Positive sectors: Banks. Oil and gas. Coal. REITs. Tech. Industrials.
Negative sectors: Iron ore. Gold miners. Lithium.
High 7246 Low 7187
Big Bank Basket Rallies hard to $172.29 (+1.0%)
All-Tech index: Up 1.2%
Brent Crude up 4.8% to US$83.73.
Gold unchanged at $2927
Bitcoin: Slips to US$27722
Aussie Dollar: Devil of a time 66.66c
10-Year Yield: Yields unchanged at 3.30%.
Asian markets: Japan up 0.7%, HK down 07% and China up 0.5%.
US Futures: Dow up 5 Nasdaq down 88

MAJOR MOVERS

LKE +7.87% independent verification of high-grade lithium carbonate.
CTT +7.27% luxury back.
TYR +8.01% media speculation on bid from Potentia.
KAR +6.54% investor presentation. Shut in and guidance.
CXL +5.27% good to see.
BPT +3.53% oil price strength.
PGF +2.62% NTA trading at a premium now.
LYC +4.42% bit of a recovery after nasty March.
88E +33.33% Hickory target reached.
JRV +18.18% change of director’s interest.
DRE +9.37% Carbonites deliver thick near surface REE results.
AGY -4.55% LRS -4.17% lithium depressed.
NWL -7.54% results disappoint.
Speculative Stock of the Day: OD6 Metals (OD6) +43.9% Good volume. Announced very high metallurgical recoveries up to 96% Rare Earth Elements (REE).

COMPANY NEWS

PYC Therapeutics Ltd (PYC) has announced that its drug candidate, PYC-001, is set to enter human trials in 2024 for the treatment of Autosomal Dominant Optic Atrophy (ADOA). The decision follows the successful completion of formal toxicological studies and non-clinical data showing promising results in patient-derived and animal models.
Mincor Resources NL (MCR) Wyloo has declared its A$1.40/share offer for Mincor Resources as the best and final, provided that there is no competing proposal. This decision comes after Mincor’s recent operations and guidance update on March 30th, in which Wyloo confirmed that it was unaware of the material information contained in the announcement.
Tietto Minerals Ltd (TIE) reports an NPAT of $17.6m vs half year ago $46.6m.
Fonterra (FSF) – Reduced its forecast for farmgate milk price range for 2023 season due to softer-than-expected short-term demand for its products. The price range has been lowered to NZ$8.00 to NZ$8.60 per kilogram of milk solids from the previous estimate of NZ$8.20 to NZ$8.80 per kg.
Telix Pharmaceuticals (TLX) applied for marketing authorisation in the UK for its Illuccix 25 micrograms kit used for PET imaging of prostate cancer, while a decentralised MAA application is also being filed for the EU.
Karoon Energy (KAR) – Bauna operations have shut down production due to a loss of containment incident associated with the high-pressure flare. Repairs were completed on March 30, but higher-than-expected flow rates prompted a full inspection and a planned July maintenance program to be brought forward, leading to the extension of the shutdown.
Coles Group (COL) – To purchase two milk processing facilities from Saputo Dairy Australia for approximately $105m. The facilities are located in Victoria and New South Wales, with each having the capability to process 225m litres of milk per year.
Westpac Banking Corporation (WBC) – Completed the merger of BT’s personal and corporate superannuation funds with Mercer Super Trust and sold its Advance Asset Management business to Mercer Australia. The completion of the sale and merger has added approximately 8 basis points to Westpac’s common equity Tier 1 (CET1) capital ratio.
Netwealth (NWL) – FUA increased by $3.4bn in the March quarter to $65.8bn, including $1.7bn of net inflows and $1.7 bn positive market movement.
Evolution Mining (EVN) expects to resume mining activities at its Ernest Henry operation in six weeks after a weather event on March 8 and will provide an update on the full impact of the event on its FY23 guidance with its March 2023 quarter results on April 20.
Sonic Healthcare (SHL) agreed to acquire Diagnosticum group of laboratories for €190m, funded by Sonic’s existing cash and debt facilities. Diagnosticum operates 15 laboratories across its regional geography and is expected to generate revenues of €65m in FY24.

ECONOMICS & OTHER NEWS

The value of new loan commitments for housing fell 0.9% to $22.6 billion in February 2023 (seasonally adjusted), after a revised fall of 2.4% in January, according to data released today by the ABS.

Building Approvals

Key statistics

The February 2023 seasonally adjusted estimate:

Total dwellings approved rose 4.0%.
Private sector houses approved rose 11.3%, while private sector dwellings excluding houses fell 9.5%.
The value of total building rose 19.7%.
The value of non-residential building rose 39.8%.

ASIAN MARKETS

Chinese Caixin Manufacturing PMI slows to 50 in March amid weak demand.
Chinese electric car brand Li Auto delivered more cars in March than Xpeng did in the first quarter, according to company releases.
BYD said it sold 264,647 purely battery-powered passenger cars in the first three months of the year, up more than 80% from a year ago. Hybrid passenger vehicle sales doubled from a year ago to 283,270 in the first quarter.

US AND EUROPEAN HEADLINES

European markets to open slightly higher. Oil prices the focus.
UBS will cut its workforce by between 20% and 30% after completing its takeover of Credit Suisse.