Author: james Carter
- The ASX 200 opened near its highs, only to fade and close off its lows, down 78 points (-1.5%) to 5,018.
- The bank sector led the weakness today, with Westpac (WBC) being the weakest link, ending 2.6% lower at $30.20.
- The broader commodities sector also experienced the sea of red as South32 (S32) dropped 7.5% lower to $1.545.
- The diamond in the rough today was Seven West Media (SWM) up 6.5% to $0.74 after announcing a $75m buyback to its investors.
- There were other hidden gems today – Regis Resources (RRL) rallied 3.6% higher to $1.59 and telco, Vocus Communications (VOC) up 1% at $6.21.
Best Sector – Consumer Staples
Interest Rates & China are in the news but NZ is interesting!
- The ASX 200 was again very volatile today after a strong start. The market finished up 25 points (+0.5%) to 5,096.
- The banks were generally strong with the exception of Commonwealth Bank (CBA) which closed down 58c (-0.8%) to $74.55 after it reported that its capital raising was completed, raising $5.1b. Westpac Bank (WBC) was the strongest today, up 1.6% to $30.99 whilst National Australia Bank (NAB) closed up 1.2% to $30.54.
- Macquarie Bank (MQG) climbed $1.77 (+2.3%) to $77.57 on news that it expects a 40% profit in the first half ending September.
- Cardno (CDD) rallied 15% higher after one of its substantial shareholder; Crescent Capital Investments Pty Ltd announced its intention to make a proportional off-market offer to acquire 1 of every 2 shares held by CDD (other than itself) for a consideration of $3.50/share.
Best Sector – Utilities
Yesterday’s price action in our markets suggested the US markets would be down significantly overnight. Instead the DJI was up 76 pts and S&P500 up 10 pts! More evidence that investors need to stand back from these markets and pick the right opportunities.
- The ASX 200 played its usual game of weakening early in the session, to then trade in positive territory by lunch. From there it drifted and closed points or 0.5% higher at 5,071.
- The banking sector was quiet after earlier weakness when Commonwealth Bank (CBA) requested a trading halt to its shares prior to the market opened. It was reported that they have brought forward the retail book build by one day. It’s understood that 50% of shareholders didn’t take up their entitlement.
- National Australia Bank (NAB) managed to scrape into the black, up 1c to $30.34, while the remaining of the big four were slightly down. Australia New Zealand Bank (ANZ) down 13c to $27.52 and Westpac Bank (WBC) down 26c to 26.5c$26.5
- The miners were mixed with RIO Tinto (RIO) out shining the pack, up $0.73 (+1.4%) to $52.00. BHP Billiton (BHP) conversely was very quiet, drifting from positive to negative, then remaining negative later in the day, closing down 13c to $23.79.
- The oil stocks were sold down even though there was a pickup in the oil price over night. Woodside Petroleum (WPL) and Oil Search (OSH) were both down. WPL closed at $28.60 down 1.9% and OSH was down 1.6% $7.45.
Best Sector – IT
Well, another wild night on the US markets after impressive upwards moves in stock prices across the Asia Pacific yesterday and then into Europe and early US. Last night the Dow fell 239 points after being up 172 points early in the day and up an impressive 390 points the previous day! Readers will note that while we have been positive our markets we have also been calling for a reasonable degree of choppiness / volatility as the markets attempt to absorb the conflicting world news stories.
- Just when investors felt that the recent selling was over, the fear factor rolled back into play. The ASX 200 shed 2.4% to 5,095.
- All Major sectors contributed to the red sea, with the Energy sector being the weakest link as expected. Woodside Petroleum (WPL) lost 2.6% at 29.13, while Santos (STO) was down 5.1% at $4.43
- In the Banking sector, National Australia Bank (NAB) disappointed the most, down 3.5% to $30.18.
- As expected, Woolworths (WOW) and its joint venture partner in Master’s injected more provided further capital ($90m)… will this be the turning point? WOW closed -2.2% at $24.76.
The market has been looking for signs of confidence and they arrived yesterday in Asia Pacific time then carried through to European and US markets. Australian equities rallied strongly yesterday (almost 1.7%) aided by strong US Futures and a solid China market but it was the Energy Sector rallying over 4% that really caught the eye.
- The ASX 200 was up across the board today, finishing on its high at 5,211, up 106 points (+2.1%).
- The banking sector performed very strongly today. Australia New Zealand (ANZ) was up 3.7% to $28.54, Commonwealth Bank (CBA) up 3.4% to $76.72 and National Australia Bank (NAB) +3.5% to $31.27, whilst Westpac Bank (WBC) was the shining star, up 4.2% to $31.81.
- The miners too, were well bought, despite BHP Billiton (BHP) Ex. Dividend today (85.71c), BHP finished down just -5c to $24.65. RIO Tinto (RIO) closed +$1.28 (2.6%) to $51.51. Fortescue Metals (FMG) pushed up strongly during the day to a high of $2.15, however only managed to finish 8c higher (+4.1%) to $2.04.
- The Australian dollar (A$) was strong, which obviously added to the strength in our market. The A$ rose back above US70c and is currently a little off its intraday high at US70.54c.
Best Sector – Financials
- The ASX 200 managed to move into the black from the get go and generally remained that way, before getting stronger towards the end of the day. The market finished up 85 points (+1.7%) to 5,115.
- The energy sector showed the way as expected this morning, with the announcement that Woodside Petroleum (WPL) made a takeover bid for Oil Search (OSH). WPL has offered 0.25 shares for every OSH share. Subscribers received a live trading alert on accumulating an energy stock today.
- The banks were also widely sought after, with the banking index up 2.0%. Australia New Zealand Bank (ANZ) closed up 83c (+3.1%) to $27.53, Commonwealth Bank (CBA) closed up $1.85 (+2.6%) to $74.17, National Australia Bank (NAB) was up 59c (+2%) to $30.20 and Westpac (WBC) closed up 72c (2.4%) to $30.52.
Best Sector – Energy
Really bullish, there's more to go in the reflation rally
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