- Markets @ Midday: Listen here at lunchtime or find all Market Matters Podcasts on Spotify.
A quiet end to a solid week for stocks, chalking up a positive move to kick off FY26. The FY25 trend of buying certainty at any price has taken a (slight) knock, with sectors and stocks representing better value attracting more flows this week. We think this is a theme that has legs, and as we suggested this morning, fund managers and momentum traders have been overweight the “Certainty Trade” for around 18 months; it will take more than a few days to unwind.
- The ASX200 rose +7pts/+0.08% closing at 8603 – a new all-time (closing) high.
- Consumer Discretionary (+0.81%), Property (+0.77%) and Healthcare (+0.72%) led the line today.
- Materials (-0.97%) gave back some of yesterday’s ~3% outperformance, Energy (–0.22%) and Industrials (-0.12%) dragged.
- Positive week for Iron Ore prices, the first in a long time, amid China’s renewed focus on supply-side reform, which could boost steel-mill margins and lift demand.
- Iron ore futures are up +2.2% for the week, with Singapore iron ore futures rising to $96.75 a ton.
- This kicked off a solid increase in the Iron Ore miners shares this week, and while BHP Group (BHP) -1.38%, Rio Tinto (RIO) -1.32% were weaker today, Fortescue (FMG) +0.43% ended up, and the group enjoyed their best week in recent memory.
- Another big block through Worley (WOR) +0.99% today, 3m shares, equivalent to 0.6% of float worth $40m trading at a 1.4% premium to this morning’s price, implying this is a buyer led transaction. It looks like WOR has moved from having a seller overhang, now to a buyer looking to pay a premium = bullish
- Silk Logistics (SLH) +23.26% jumped following news the ACCC would not oppose the pending takeover offer from DP World at $2.14 per share.
- Cleanaway Waste Management (CWY) +0.73% rose after the ACCC approved of its acquisition of Contract Resources stating it wouldn’t materially lessen competition.
- Citi provided some views on Domino’s (DMP) +2.17% today after this week’s big decline post CEO exit, saying “While we appreciate how honest and genuine the executive chairman was, we’ve come away from this afternoon’s company conference call incrementally more cautious around the outlook for Domino’s”
- Magellan (MFG) +0.42% reported total FUM for June of $39.6 billion vs. $39.3 billion m/m, with only $200m of net outflows, and importantly, no insto outflows – a big milestone for MFG.
- Monadelphous (MND) +1.05% lifted on news it had secured a $100 million contract with Technip Energies for commissioning of Shell’s LNG projects in W.A.
- ARB Corporation (ARB) +3.84% was upgraded to a buy rating at Citi, citing rate cuts and new product opportunities to fuel growth. We like this stock, and think it has a great runway for turnaround.
- Pro Medicus (PME) +0.16% was flat despite Bell Potter and Macquarie downgrading the stock on valuation concerns.
- G8 Education (GEM) -3.52% continued its multiday slide after allegations of misconduct against a former employee were revealed earlier in the week.
- Gold rose US$16/oz during the session, trading around $US3342/oz at our close.
- Mixed trading in Asia, Hong Kong down -0.8% though China and Japan both trading +0.2% higher.
- US Futures are all mildly lower, down around 0.3%.
