Archives: Reports
The ASX200 advanced another +0.85% last week, closing less than 1% below its all-time high. The upside momentum has slowed slightly but investors appetite remains into any semblance of a dip. Over the week only 5 of the 11 sectors advanced but gains of more than 2% by the real estate and financial sectors was more than enough to offset dips of over 1% by the tech and consumer discretionary names. The week was company dominated with economic news relatively thin on the ground
We wrapped up a huge FY24 reporting period today, and while the market finished the month up just ~0.3% inclusive of dividends, there were some incredible moves under the hood, as outlined in the tables below. For now, we must respect the trend, and if we do get a scenario of lower interest rates, yet economies hold up, equities should do very well – a glass-half-full view to end a huge month for markets and MM content!
Artificial Intelligence (AI) has often been the market’s focus over recent years, and never more so than yesterday after Nvidia (NVDA US) posted its second-quarter results. In summary, the world’s most famous AI play produced US$30 billion revenue in the quarter, its adjusted earnings per share (EPS) rose by 152%, and it is planning a US$50 billion share buyback, but the stock still fell over 6%, with “great” not being good enough after the stock’s parabolic gains over the last year.
A softer session for the ASX today, though once again, strong buying of the dip played out with the index finishing ~30 points up from the lows, moving inline with US Futures that tracked higher during our time zone after initial weakness prompted by an afterhours sell-off in Nvidia.
The FANG+ Index is a good gauge of the health of the aptly named “Magnificent Seven” stocks, which have lifted US indices higher over the last twenty months. The recent ~21% sharp pullback illustrates that even the most robust pockets of the market retrace when they get ahead of themselves, i.e. positions become “crowded” leaving fresh buying scarce at best. We don’t believe the advance is over, but it’s maturing, which is likely to see the weaker members start/continue to struggle.
The ASX opened firmly on the backfoot and selling intensified post a hotter than expected monthly inflation read at 11.30am, down ~60pts at the lows before a consistent/impressive grind back up to par by the close – the buy the dip mentality remains in play!
The ASX200 surrendered early gains on Tuesday to close down -0.2%, with over 60% of the main board ending the session lower. It was a rare day of weakness for the banks and strength in the resources, but as we often say, the market can’t go up without the banks. The “Big Four” slipped an average of -0.7% while Bendigo (BEN) tumbled -4.2% following their average FY24 result on Monday, i.e. after surging over +30% year-to-date, the market expected more.
A big day of reporting across Market Matters Portfolios with some hits and a few misses, particularly amongst the smaller companies. Overall, it felt like the market lost some steam after a squeeze higher in early trade. While calling tops is fraught with danger, we wouldn’t be surprised to see some consolidation from here.
