Viewpoint: Bullish
The ASX200 slipped lower yesterday, as we come into Friday “the song remains the same” with the local market very happy to simply rotate around the 7300 area whatever the macro / market news that crosses our screens. In what was a quiet session during an even quieter few weeks for stocks a few points did catch my attention:
JD.com (JD US) is an online direct sales company in China. The Company offers a wide selection of products through its website and mobile applications. JD.com sells appliances, computers, digital products, communication products, garments, books, and household items to consumers and vendors.
This ETF has a meaningful ~20% exposure to Afterpay (APT) but we still like it over the coming months although our target area around the $26 level is now likely to take longer to be achieved while APT remains under pressure.
Our International Portfolio was in the correct US bank overnight as Wells Fargo (WFC) rallied while Bank of America (BAC US) fell following 2nd quarter earnings. A further drift lower by US bond yields following Jerome Powell’s speech didn’t help the sector e.g. US 10-years retreated back under 1.35%.
Overnight saw another firm session for most US Indices but the small cap Russell 2000 Index was the standout exception falling -1.6%, local investors should be mindful that the ASX is regularly more correlated to this and European indices as opposed to the S&P500 which is heavily influenced by the US tech sector.
Intellectual property firm IPH has been catching my eye over recent weeks and yesterday it tested its 2021 high, a part franked yield ~3.6% is clearly attractive to many in today’s environment.
SKI charged out of the blocks yesterday finally closing up +7.8%, best on ground for the day and at it highest level since mid-2019 proving that action can even unfold in the often regarded most boring end of town. The Australian was touting another takeover was looming and the price action certainly endorsed these rumours, the numbers certainly look ok for such a move:
The ASX200 enjoyed a solid Wednesday in the face of some negative leads as US stocks drifted lower and the local BNPL space was clobbered courtesy of Apple (AAPL US) – more on this later. Under the hood we saw ongoing mean reversion with the likes of Crown (CWN) and HUB24 Ltd (HUB), who both reside in the MM Flagship Growth Portfolio bounce strongly after struggling over the last few weeks i.e. pretty much a continuance of the trend across recent months.
IPH Limited is an Australia-based holding company. The Company provides intellectual property (IP) services in the Asia-Pacific region. It offers a range of IP services and products to a diverse client base including companies, multi-nationals, universities, public sector research organizations, foreign associates and other corporate and individual clients. It operates through three segments: Intellectual Property Services Australia & New Zealand; Intellectual Property Services Asia, and Adjacent Businesses. It operates an intellectual property services group, comprising a network of member firms working in eight IP jurisdictions and servicing more than 25 countries. The group includes AJ Park, Applied Marks, Griffith Hack, Pizzeys and Spruson & Ferguson, and the autonomous timekeeping business, WiseTime.
PPS +14.95%: the investment platform company saw its shares trade to a 2 year high today after announcing more positive flow numbers. Funds Under Administration (FUA) hit a record $41.7b with inflows of $1.2b in the quarter. The key for these platforms is scale – with flattish cost bases, top line growth has a leveraged impact on profits.
