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First Up

UPDATED 02/09/2025 09:27

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The ASX200 fell away after an ok first 30 minutes to end Monday, the first trading day of September, down 0.5%. The ASX started the new month on the wrong foot, dragged down by the big banks and major miners, while gold surged to a new all-time high following another post by Donald Trump – more on this later. The financials contributed over 50% of the index’s decline, again illustrating the influence of the “Big Four Banks”, ably assisted by the consumer discretionary and tech sectors contributed 20% apiece in a risk-off day for stocks.

Winners on the day were led by gold stocks, the consumer staples and utilities as investors started the month in a defensive mood.

Earnings season is in the rearview mirror, and it’s time to evaluate whether the winners can push higher, as we saw from Harvey Norman (HVN) yesterday, or whether some battered-up names offer compelling value. In most cases, the FY26 read-throughs will determine investors’ appetite for a particular stock. Ironically, consensus now points to ASX 200 earnings rising 4.5% in FY26, down from 5.4% a month ago. This is not a great outcome overall, yet we saw a very positive bias in terms of stock moves: 28 stocks in the ASX200 surged by over +20%, while only 5 fell to the same degree. Overall, a sign that there’s still cash out there looking for a home.

There’s been more takeover news as the ASX appears to shrink every month, with RPMGlobal (RUL) signing an exclusivity deed with Caterpillar after receiving a non-binding proposal to acquire all of the RPM shares and options on issue for AU$5 apiece by way of a scheme of arrangement. Shares of the company rose 23% by the close, hitting a fresh all-time high. This was excellent news for MM, which holds RUL in our Emerging Companies Portfolio.

Overseas markets were quiet overnight, with US markets closed for Labor Day. The German DAX closed up +0.6% and the EURO STOXX 50 +0.3%. The S&P 500 and Nasdaq 100 futures contracts advanced 0.2%, with cash trading in US stocks and Treasuries closed for the Labor Day holiday.