Viewpoint: Bullish
The Australian market retreated on Tuesday with heavyweights BHP, CBA, and CSL all closing lower during another lacklustre session that saw over 60% of the mainboard retreat but only 2% of the ASX200 moved by over 5%. The markets are enveloped in negative sentiment yet the Australian market is only ~3.5% below its all-time high as investors await the perceived “inevitable correction”. However, as we’ve been saying if too many people are overweight cash and looking to buy dips such moves are usually shallower than expected.
US stocks and bonds both edged higher on Monday ahead of some major earnings this week including Netflix, Tesla, and Johnson & Johnson yet markets are extremely comfortable at current levels with the VIX (Fear Gauge) dipping under 17%. Analysts expect earnings to decline for the 2nd straight quarter logging the steepest quarterly decline since 2020, by definition, this leaves room for surprises on the upside as we saw from the banks last week.
Worley is a $8bn global engineering, advisory, and project management services company with a key sector focus in the energy, chemicals, and resources sectors. In late February WOR delivered a strong earnings report while stating that it expects FY23 earnings to be broadly consistent with consensus.
At a glance some subscribers may have thought NHC plunged -9.5% yesterday but the stock traded ex-dividend 40c fully franked reducing the decline to just -0.9%. Overall a solid performance in our opinion considering coal exports through Newcastle have just endured their slowest first quarter since 2019 due to the combined hindrances of wet weather and ongoing labour shortages.
