Viewpoint: Bullish
It’s been reported in AFR Street Talk overnight that Klarna has acquired a ~4% stake in Zip Co. Klarna is massive (CBA is a shareholder), an unlisted market leader in Instalment/BNPL payments in the Northern Hemisphere and has the capital to swallow Zip with minimal effort. Zip competes with Klarna across numerous markets and with ZIP stock ~8% short, a potentially strong quarterly coming (next week) we could see some fireworks here
Yesterday saw the local market rally +0.9% more than recovering the losses on Tuesday, the growth names led the line following US indices overnight who embraced the drift in US bond yields i.e. Tech & Healthcare. The stock and sector rotation continues while the ASX200 remains basically unchanged since the start of June, below are some of the names catching our eye for both good and bad reasons:
The Flagship Growth portfolio owns a number of contractors which are currently showing a loss on paper.
The integrated marketing and printing business has been a weak link in the Income Portfolio (as well as the Emerging Companies Portfolio), hurt particularly hard through Covid, however the stock more recently has been a quiet achiever rallying nearly 7 fold since March 2020.
Right on cue after our positive comments towards the Oil Sector yesterday OSH jumped out of the blocks to be the ASX200’s top performer gaining +4.6%.
European indices are drifting lower in a very similar manner to the ASX maintaining their strong historical correlation.
The $US kicked higher yesterday after drifting early, the result being fairly aggressive pullbacks in the likes of crude, copper and gold – as we anticipate further upside from the greenback MM is holding back from increasing our exposure to the resources although gold stocks do appear to be forming a base.
Yesterdays was all about the RBA with a little NSW COVID news thrown into the mix with neither feeling particularly bullish for stocks. Tuesday saw weakness pick up steam throughout the day with the market closing on its lows down -0.7%.
NVIDIA (NVDA US) designs, develops, and markets three dimensional (3D) graphics processors and related software. The Company offers products that provides interactive 3D graphics to the mainstream personal computer market.
SRG Global (SRG) operates as a construction services company. The Company constructs skyscrapers, bridges, dams, structures, transport infrastructures, and oil and gas projects, as well as offers drilling support, civil engineering, and industrial maintenance services. SRG Global serves customers worldwide.
