Archives: Reports
We are making multiple changes to the Flagship Growth Portfolio.
We’ve edged into what we see as the ‘deep value’ space, already buying a few beaten up stocks in Elders (ELD), Lendlease (LLC) and Magellan (MGF), looking for turnarounds to unfold on the stock specific level – encouragingly all of these positions are showing a small paper profit with an average of +5.5%.
A solid day for the ASX as reporting threw up some more interesting candidates from a broad cross-section of industries, some hits, misses and a few in between, while we saw some action amongst the energy stocks with Crude breaking higher and Coal prices finding some support.
We currently hold two property positions in our Active Income Portfolio which are unloved and priced accordingly while in our Growth Portfolio, we only hold Goodman Group (GMG) which is regarded by many as more of a growth play. Investors remain scared of property and other cyclical sectors however we think this pain, or at least the vast majority of it, is now priced in and we should be increasing our attention towards identifying the opportunities.
Shares started slowly today but found their mojo into the afternoon, finishing near highs on the back of strength in the banks. There was little change ahead of inflation data coming out of China mid-morning, but when that passed without concern, the focus returned to CBA’s record result.
The theme through most of 2023 has been the strong getting stronger and vice versa and this is playing out early this reporting season with buyers showing no interest in buying dips after a disappointing result – not classic bull market price-action but very befitting of one of the most hated bull markets in history. This morning will see a big test for the financials with investors needing to digest Commonwealth Bank (CBA) and Suncorp (SUN) results this morning.
The day started well with some reasonable buying across most major sectors however by midday, things had taken a turn and optimism was thin on the ground. A mixed bag from companies that reported results ahead of Commonwealth Bank (CBA) out with numbers tomorrow morning – we’ll cover them as they land.
Although it often gets less attention, what to avoid is as important as what to buy and with MM looking for a major rally in bonds/pullback in yields the performance baton is likely to change hands a few times during the 2H. Following moves which caught our attention over recent sessions we thought today was an ideal time to revisit 3 sectors we are cautious towards due to their defensive nature &/or preference for a higher interest rate environment.
A subdued start to the week with the ASX edging lower, void of any real impetus in either direction. A bank holiday, no influential companies reporting and a softer night on Friday in the States saw local investors sit largely idle, with winners and losers split evenly across the main board.
When all of the news went into the mixing pot bonds continued to follow the MM roadmap with US 2-Years slipping to 4.76%, well below both their July 5.1% high and the current Fed Funds target range of 5.25%-5.5%, on the equities front, we saw some weakness flow through from reporting season which was compounded by strong moves from some stocks ahead of their reports.
