ASX 200 started the week down 16 points to 7263 (-0.2%) tracking the US markets as debt ceiling jitters continue. Banks weighed down the ASX today, Big Bank Basket fell to $170.32 (-0.9%), CBA the biggest loser down 1%, ANZ, NAB, and WBC all off -0.8%, -0.7%, and -0.8% respectively. Tech continued to rally, with the All-Tech index up 0.2%, XRO continued to climb up another 1.3%, after gaining 15% last week, WTC up 1.9%, ALU up 1.4%, and NXT gained1%. Energy sector performed well up 1% thanks to a surge in oil imports in China, which has almost hit a decade high, WDS, STO, and BPT all gained over 1%. Lithium stocks took a beating, AKE and PLS hammered, down 3.1% and 2.8% respectively. Gold miners eased, NST down 0.8% and NCM fell 0.3% Industrials were underwhelming. WOW off 0.4%, WES down 1%, and TLS slipped 0.6%. Healthcare and Insurers in positive territory, CSL +0.7% RMD +0.7%, QBE +1.2%, and SUN gained 0.9%. REITS slipping off 0.8%, GMG down 0.8% and VCX also down 2.7%. In corporate news, GTK surged 29.1% on results, specifically a 47% jump in sales. In contrast CCX fell 5.8% on a decline in sales. TYR plunged 16.1% after Potentia pulled its takeover offer. Nothing on the economic front. Asian markets are higher, Japan up 0.7% and HK up 1.3% with China stronger +0.1%. Australia 10Y yield 3.58%. Bitcoin up 0.88%. Dow Jones futures down 34 points and Nasdaq futures up 5 points.
- Winners: BRN, STX, MAD, LLL, KLS, NAN, NEU, WTC, TPW
- Losers: TYR, IMD, CBO, AX1, TIE, CTT, AGY, SYR
- Positive sectors: Tech. Oil and gas. Insurers.
- Negative sectors: Banks. Lithium. Base metals. REITS.
- High 7285 Low 7250 Narrow range. No conviction.
- Big Bank Basket: Falls to $170.32 (0.9%)
- All-Tech index: Up 0.2%
- Gold slips to $2972
- Bitcoin: Drifts to US$26741
- Aussie Dollar: Steady at 66.49c
- 10-Year Yield: Pushing higher to 3.59%.
- Asian markets: Japan up 0.7% and HK up 1.3% with China stronger +0.1%
- US Futures: Dow down 34 Nasdaq up 5.
- BRN +8.5% kicking again. No reason.
- STX +5.4% good volume too.
- MAD +3.8% low volume move.
- KLS +3.4% All Aboard.
- LLL +3.4% selected lithium plays doing well.
- BTH +15.00% board reveals bid.
- GTK +29.1% half yearly results briefing.
- WA1 +9.8% change in substantial holding from Tali Resources.
- EBR +10.5% CEO presentation. One to watch.
- TYR -16.6% No Potentia bid now.
- AX1 -5.8% out of fashion
- CTT -5.2% profit taking.
- SYR -4.6% rally short lived.
- RHY -12.5% backing and filling.
- 5EA -11.3% OSM to acquire US Lithium project.
- CBO -5.9% squashed.
- GLN -10.8% strongly supported placement raised $31.5m at 105c
- Speculative Stock of the Day: Wildcat Resources (WC8) +34.5%. Follows last week’s reinstatement after acquisition of LCT Pegmatite field in the Pilbara lithium province WA. The acquisition is the Tabba Tabba Tantalum Mine and Lithium -Tantalum project.
- Silver Lake Resources (SLR) – Revised $722m cash and scrip offer for St Barbara’s (SBM) Gwalia gold mine, surpassing Genesis Minerals’ (GMD) bid.
- AFT Pharmaceuticals (AFP) – Announces a maiden dividend after reporting record revenue of NZ$156.6m, with operating profit slightly lower than the previous year. The company declared a dividend of NZ1.1c per share.
- Infratil (IFT) – 28% decrease in NPAT for the year ended March 31, with operating revenue increasing from the previous year.
- BlueScope (BSL) – BSL and New Zealand government will jointly fund approximately $NZ300m for the construction of an electric arc furnace at the New Zealand Steel works.
- Tyro Payments (TYR) – Potentia has decided not to proceed with its proposal to acquire Tyro Payments, despite engaging in due diligence and extensive negotiations for eight months.
- City Chic Collective (CCX) – 15.2% decline in group sales for the 45 weeks to May 14 compared to the previous year. The company plans to accelerate its inventory unwind, particularly in the EMEA market, aiming to improve cash flows and reduce its inventory balance to below $100m by the end of FY23.
- Bigtincan Holdings Ltd (BTH) acknowledges receiving a confidential, non-binding offer from Siris Capital Group at around 80c. BTH board does not believe it is in the best interests of shareholders to pursue the Siris Proposal. Clearly not serious at all.
- Gentrack (GTK) – Reports a net profit of $NZ7.9m and a sales increase of 47.7% for H1, with sales guidance of $NZ157m to $NZ160m for FY23.
ECONOMIC & OTHER HEADLINES
- The government will now regulate the BNPL sector as a ‘credit product’. The government said the checks would be “scalable”, but it remains unclear what actual practices will be needed to satisfy the new requirements.
- Clearance rates across Australia’s capital cities rose to a 15-month high over the week to Saturday despite auction volumes increasing. The 75.3% preliminary clearance rate across the six capitals rose from the previous week’s 74.4% initial reading (revised down to 70.7% subsequently).
- Sydney volumes and clearances both rose, with a 78.2% preliminary rate – the country’s highest – up from the previous week’s 76.2%, and scheduled auctions lifting to 762 from 650.
- In Melbourne, the preliminary clearance rate of 74.4% was down on the previous week’s preliminary 75.7%, with the number of scheduled auctions up 12% to 834.
- There were 592,059 participants in the NDIS as of March, according to the National Disability Insurance Agency’s (NDIA) latest quarterly report.
- Japan’s core machinery orders, a leading indicator of capital spending, fell 3.9% month-on-month in March, missing expectations for a 0.7% increase. On an annual basis, private-sector machinery orders declined by 3.5% in March, reversing from February’s 9.8% growth.
US AND EUROPEAN HEADLINES
- European markets heading for a cautious opening.
- Biden back and talking to McCarthy. Debt ceiling has taken focus off Fed.
- Greece’s ruling New Democracy party stormed to victory in a parliamentary election on Sunday. Not quite enough to form government on its own. New Democracy took a commanding lead of 40.8%, trouncing the radical leftist Syriza, which governed from 2015 to 2019, and polled 20.1%.