ASX Weekly Report for 5 Feb to 9 Feb 2024

Moomoo AU 發表了文章 · 02/11 19:29

Global equity markets mostly rose again last week with the S&P 500 from the US rising above the key 5000 level for the very first time. The index closed up 1.34% at 5026.61. $SPDR 標普500指數ETF (SPY.US)$

The Dow Jones Index rose 0.39% and the Nasdaq gained 3.56% as the US earnings season outperformed expectations. Around 67% of the top 500 US companies have reported their earnings to December and over 79% have reported better than expected. Average earnings growth is c8% compared to the forecast of 4.5% at the beginning of earnings season.

Also supporting the market were comments from Fed Chairman Powell that interest rate cuts were not imminent but nonetheless likely this year however market projections of six rate cuts were unlikely. The US appears to be experiencing growth with low inflation and heading for a ‘soft’ landing.

China’s stockmarket also rose sharply last week (up 4.97%) as the country headed to it’s famous Lunar New Year celebrations. Earlier in the week authorities announced further stimulus and support for its stockmarket including a curb on short-selling and further State investments. It is also replacing the head of it’s stockmarket regulator. China shares have lost around 30% of their value since mid-2021 and the bounce this week could prove to be a major turning point for the embattled market.

Japan’s shares rose 2.04% for the week, European markets gained 0.18% and Hong Kong lifted 1.37%.

In Australia the RBA met to consider its interest rate settings. It decided to leave rates on hold but comments from the Governor Michelle Bullock were somewhat hawkish as she explained that it is possible we may see further rate hikes. Few economists believe we will see further rate hikes and the RBA is playing a delicate game having waited way too long to begin raising rates almost 2 years ago. It will be keen to avoid a similar mistake when cutting rates.

Complicating the consumer spending scenario are the changes to the Stage Three tax cuts that have been announced and that will put more money in the hands of the consumer after June 30 as well as the phenomenon that is Taylor Swift, whose Australian tour starts later this month.

Studies on economic activity have suggested as much as $US4.6 billion of spending in the US is as a result of the Swift tour. In some cities where she performs hotel and restaurant bookings have hit record levels. The RBA will undoubtedly follow closely the spending of the Swifties, as Taylor Swift fans are known!

Australia’s S&P/ASX200 actually fell slightly this week (-0.79%) with the All Ordinaries Index also dropping 0.59%.

The Australian Dollar rose slightly to $US0.6526, Gold closed up at $US2039 an ounce and Iron Ore was flat at $128.75. Oil gained 5.99% to $US76.61 a barrel.

Australian 2 year bonds rose 3 basis points to 3.805% while 10 year bonds rose 7.8 basis points to 4.16%.

In the individual equity market sectors Energy (-3.44%) and Materials (-3.03%) were the worst performing sectors along with Consumer Staples (-1.73%) and Consumer Discretionary (-0.93%).

Health Care was the best performing sector rising 1.32% followed by IT (+0.91%) and Financials (+0.73%).

CBA continued to defy its critics rising for the 14th week out of the last 15. It closed at a record closing high of $116.24 up 0.37% for the week. With over 50% of it shareholders classified as ‘retail’ the stock is being re-rated as we enter a benign credit environment and with hundreds of million dollars of bad debt provisions potentially able to be put back straight to the bank’s bottom line. $CommBank (CBA.AU)$

Read CommBank's earnings preview here.

Shares in Silver Lake Resources fell 15.4% last week on news that its merger with Red 5 had been called off.

Nick Scali share jumped 21.66% last week on the back of stronger than expected earnings. $Nick Scali Ltd (NCK.AU)$

Luxury online retailer Cettire gained 28.62% as it revealed strong trading conditions and an increase in profitability. Revenue increased a phenomenal 90% over the previous corresponding period (pcp). $Cettire Ltd (CTT.AU)$

News Corporation saw its net income nearly double in the second quarter as subscription and digital revenues soared. It’s shares rose 6.73%. $News Corp (NWS.AU)$

Bionic ear implant provider Cochlear rose 4.34% as the company upgraded earnings guidance for 2024. $Control Bionics Ltd (CBL.AU)$

Santos fell 7.34% after energy giant Woodside announced that it is walking away from its potential $80 billion merger. $Santos Ltd (STO.AU)$

Each week we seem to report on more senior executives leaving iron ore miner Fortescue Minerals. This week another two have left the company, taking the tally to more than 14, including the Head of European Operations after only 10 months. The Company Secretary also announced he was stepping back. Fortescue shares lost 4.94%. $Fortescue Ltd (FMG.AU)$

Uranium stocks have taken a breather from their stellar run including Boss Energy that tumbled 14.40% last week.

In the week ahead we will be watching earnings releases for some of Australia’s leading companies including: JB HiFi (Mon), Seven West (Tues), AMP, CBA Seven (Wed), Origin, TWE, WES (Thur), ASX, QBE (Fri). $AMP Ltd (AMP.AU)$ $CommBank (CBA.AU)$ $Origin Energy Ltd (ORG.AU)$ $Treasury Wine Estates Ltd (TWE.AU)$ $Wesfarmers Ltd (WES.AU)$ $ASX Ltd (ASX.AU)$ $QBE Insurance Group Ltd (QBE.AU)$

In economic news we will be watching the US CPI for Jan (Tues), Australian Consumer Confidence for February (Tues), Business Conditions (Tues) and Japan GDP growth for the December quarter (Thur).

Check out this week's earning calendar here.

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