The Overnight Report: Gassed Up

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(
    [0] => Array
        (
            [0] => ((BPT))
            [1] => ((WDS))
            [2] => ((STO))
            [3] => ((FMG))
            [4] => ((CRN))
            [5] => ((WHC))
            [6] => ((NHC))
            [7] => ((BEN))
            [8] => ((NHF))
            [9] => ((RHC))
            [10] => ((CSL))
            [11] => ((BSL))
            [12] => ((ORG))
            [13] => ((SHL))
            [14] => ((SUL))
        )

    [1] => Array
        (
            [0] => BPT
            [1] => WDS
            [2] => STO
            [3] => FMG
            [4] => CRN
            [5] => WHC
            [6] => NHC
            [7] => BEN
            [8] => NHF
            [9] => RHC
            [10] => CSL
            [11] => BSL
            [12] => ORG
            [13] => SHL
            [14] => SUL
        )

)

This story features BEACH ENERGY LIMITED, and other companies.
For more info SHARE ANALYSIS: BPT
The company is included in ASX200, ASX300 and ALL-ORDS

By Greg Peel

One-Trick Pony

Australia’s was the first (major) global market to respond to news over the weekend Russia had shut down the Nord Stream gas pipeline to Europe indefinitely due to a “leak”, which Europe fears implies “for the duration”.

The result was a 4.0% jump yesterday in the ASX200 energy sector, on the implicit flow-through to LNG export prices.

Beach Energy ((BPT)) rose 5.5%, Woodside Energy ((WDS)) 4.3% and Santos ((STO)) 3.1%.

The move for the sector countered, for the index, any weakness on offer from Wall Street’s fall on Friday night on news of said pipeline.

But energy was aided and abetted by a 1.9% gain for materials, net of Fortescue Metals ((FMG)) going ex-dividend and falling -4.6%. A bounce in the iron ore price drove the big miners higher while a bounce for gold, on lower US bond yields, pushed up gold miners. But the big moves were posted by the coal miners.

If you don’t have gas what can you burn for power? Coronado Resources ((CRN)) topped the ASX300 with a 7.5% jump, while ASX200 members Whitehaven Coal ((WHC)) and New Hope Corp ((NHC)) saw 6.5% and 5.7% gains.

Utilities joined in slightly, up 0.2%, while the only other sector to close in the green on the day was old reliable staples, also up 0.2%.

Financials fell -0.4%, with both Bendigo & Adelaide Bank ((BEN)) and nib Holdings ((NHF)) going ex, while healthcare dropped -0.6% with Ramsay Health Care ((RHC)) going ex.

Consumer discretionary lost -0.5% and real estate -0.7% ahead of today’s expected 50 point rate hike from the RBA.

Eighteen of the top twenty ASX300 gainers were materials or energy stocks, whereas the losers offered an assortment.

In economic news, Australia’s corporate profits and wages rose above expectation in the June quarter, leading economists to suggest upside risk to their GDP forecasts.

Company profits rose 7.6%, led by a 14% gain for mining (which includes energy) and only a 1% gain for non-mining. Wages rose 3.3% – the largest quarterly move since 2008 – compared to 1.9% in the March quarter.

Inventories only rose 0.3%, having risen 3.6% in March, reducing fears of companies being stuck with unmovable stock.

Without any overnight lead from Wall Street, our futures are up 8 points this morning.

There’s another sizeable list of ex-dividends today, including CSL ((CSL)).

Commodities

European natural gas futures traded up as much as 35% in last night’s session before settling back to gains in the twenties. There is no one price – each country has its own market. The move comes as Europe and the UK desperately try to store enough gas ahead of the northern winter, and Russia’s latest move has increased the odds of winter gas rationing.

Welcome aboard Liz Truss.

OPEC-Plus, which includes Russia, met last night and made good on its threat to cut crude oil production. However, the cut of -100,000 barrels per day is seen as small. Enough, however, to send oil prices 2-3% higher in America’s absence.

Meanwhile, a lack of rain in China is impacting on hydro power generation, and thus metal smelting.

The Aussie is up 0.3% at US$0.6800.

Today

The SPI Overnight closed up 8 points.

The rate that stops the nation is due at 2.30pm.

Today brings the June quarter current account, including the terms of trade.

Aside from CSL, stocks going ex-dividend today include BlueScope Steel ((BSL)), Origin Energy ((ORG)), Sonic Healthcare ((SHL)) and Super Retail ((SUL)).

The Australian share market over the past thirty days…

For more detail go to FNArena's Australian Broker Call Report, which is updated each morning, Mon-Fri.

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