AU Morning Wrap: ASX rallies 1%, real estate and tech in the lead

Wall Street Summary
US stocks rose for a second day after GDP data showed the economy contracted for a second straight quarter. Treasury yields retreated in a sign bond traders think the slowdown will compel the Fed to reassess the current steep trajectory for interest rates.

The $S&P 500 Index(.SPX.US)$ climbed 49 points or 1.21 per cent. The $Dow Jones Industrial Average(.DJI.US)$ put on 332 points or 1.03 per cent. The $Nasdaq Composite Index(.IXIC.US)$ added 130 points or 1.08 per cent.

AU Market Watch
Australia's S&P/ASX 200 is set to rise at the open after getting a strong lead from Wall Street, even as new data showed the U.S. economy contracted for a second quarter in a row. ASX futures are up by 1.0%.

Australian shares opened higher this morning. The $S&P/ASX 200(.XJO.AU)$ gained 1.17 per cent to 6970 as of 10:14 am.

Australian government bond yields dropped to their lowest in three months after another quarterly contraction in the US economy reinforced fears of a looming global recession.

The three-year government bond yield fell to 3.1 per cent, the lowest since early May. It has shed 27 basis points this week. The 10-year rate eased to 3.11 per cent, a level last touched on April 28. It has dropped 22 basis points this year in a yield curve steepening. The gap between the 2-year and 10-year shrank to 38 basis points, from 58 basis points on Monday.

Stocks to Watch
$Sezzle Inc(SZL.AU)$: Buy-now-pay-later stock Sezzle reported its 2Q earnings for FY 2022 with total income up 6.8% year-on-year to reach US$29.3 million.

$Pointsbet Holdings Ltd(PBH.AU)$: Bookmaker PointsBet reported a 28 per cent increase in net win to $755.2 million in the fourth quarter of FY 2022, and a net win margin of 9.2 per cent, above last year's 8.7 per cent.

$Prospa Group Ltd(PGL.AU)$: Non-bank lender Prospa posted record full-year EBITDA of about $12 million driven by business growth and tech investments. It originated $246 million in loans in the last quarter of its financial year, up 35 per cent from the previous period. Its revenues jumped 61 per cent to $54 million against the same period in FY 2021.

$Origin Energy Ltd(ORG.AU)$: Origin Energy on Friday recorded a 103% rise in its fourth-quarter revenue from its stake in the Australia Pacific LNG (APLNG) project due to a surge in realised prices for liquefied natural gas (LNG) and oil.

Ex-dividend: $PARTNERSGG UNITS(PGG.AU)$

Dividends paid: $James Hardie Industries PLC(JHX.AU)$, $Plato Income Maximiser Ltd(PL8.AU)$, $Rural Funds Group(RFF.AU)$, $Steamships Trading Co Ltd(SST.AU)$

Commodities
• Iron ore futures rallied 10% to US$118.3.
• Oil prices were volatile thanks to the push and pull of a second consecutive contraction for the US economy and reports that OPEC will likely keep production steady.
• Gold is making a push towards US$1,800 as recession risks further validate the view that the Fed will need to slower its pace of tightening.

Source: Dow Jones Newswires, AFR