Daily Market Reports | Feb 12 2024
This story features WOODSIDE ENERGY GROUP LIMITED, and other companies. For more info SHARE ANALYSIS: WDS
World Overnight | |||
SPI Overnight | 7595.00 | 0.00 | 0.00% |
S&P ASX 200 | 7644.80 | + 5.60 | 0.07% |
S&P500 | 5026.61 | + 28.70 | 0.57% |
Nasdaq Comp | 15990.66 | + 196.95 | 1.25% |
DJIA | 38671.69 | – 54.64 | – 0.14% |
S&P500 VIX | 12.93 | + 0.14 | 1.09% |
US 10-year yield | 4.19 | + 0.02 | 0.41% |
USD Index | 104.14 | + 0.08 | 0.08% |
FTSE100 | 7572.58 | – 22.90 | – 0.30% |
DAX30 | 16926.50 | – 37.33 | – 0.22% |
By Greg Peel
No Thrill Ride
It was a dozy old Friday for the ASX200 with the index trading up 16 points at its high and down -11 at its low, to close up 5. The local market found no impetus from a flat Wall Street close overnight.
The lack of interest carried through Friday night. The S&P500 closed up 0.6% but our futures were unchanged on Saturday morning.
There were nevertheless some large moves among some sectors.
Energy was the worst performer (-1.3%) after Woodside Energy ((WDS)) fell back a bit following its relief rally based on abandoning merger talks with Santos ((STO)).
Healthcare rose 1.0% with Cochlear ((COH)) up another 5.9% post guidance upgrade.
Technology gained 1.2% after being relatively quiet of late.
Utilities fell -0.8% after the froth came off post AGL Energy’s ((AGL)) strong result and subsequent rally.
Materials was a mixed bag (-0.3%), balancing a strong result and guidance upgrade from Boral ((BLD)), which had that stock up 8.3%, and steep falls for high-flying uranium stocks after the uranium spot price took a dip for once led by a weaker than expected result from Canada’s Cameco.
Boss Energy ((BOE)) fell -12.7% and Paladin Energy ((PDN)) fell -7.0%.
Lithium miner Liontown Resources ((LTR)) nonetheless won the day in jumping 10.4% ahead of a potential return of interest from Gina Reinhart.
The turnaround for the index from the low to the high came as the RBA governor testified to parliament, suggesting the CPI did not need to come all the way back to 2.5% before rate cuts would be considered. Nor does services inflation need to return to 2-3%.
The excitement didn’t last long given economists have been assuming such this year, and continue to forecast the first cut coming towards the end of the year. August is still in the frame for some, but others are more inclined to assume November.
China is now closed for a week so things will be quieter among commodity prices and our market in general. Earnings reasons ramps up this week so the micro will take centre stage.
Wall Street is becoming less influential as it pushes higher on Mega Tech gains.
Across the Line
Having touched the 5000 level for only the blink of an eye on Thursday night, the S&P500 comfortably closed above that level on Friday night for the first time. The index has now doubled since the covid low in 2020.
The Nasdaq did not quite reach 16,000, which it first hit at the end of 2021. The Nasdaq has only recovered losses booked in 2022 to get back towards the high.
Driven, of course, by the Mega Techs, and more specifically by AI. Although having seen the market breadth which picked up late last year diminish in early 2024, breadth appears now to be returning. The Russell small cap added another 1.5% on Friday night.
Attributed with pushing the S&P500 over the line were revisions to recent CPI results. The headline increase in December was lowered to 0.2% from 0.3%.
That said, the December core rate was left unchanged at 0.3% and the November result was revised up to 0.2% from 0.1%. Wall Street liked it anyway. The US two-year bond yield rose 3 points to 4.49% to its highest level since December.
The S&P500 has risen in 14 of the past 15 weeks. The last time that happened was in 1972. It has happened 13 times since the index was introduced in 1957.
Wall Street will look ahead now to the January CPI result on Tuesday night.
Commodities
Spot Metals,Minerals & Energy Futures | |||
Gold (oz) | 2033.00 | – 0.50 | – 0.02% |
Silver (oz) | 22.54 | + 0.38 | 1.71% |
Copper (lb) | 3.70 | – 0.04 | – 0.99% |
Aluminium (lb) | 1.00 | + 0.00 | 0.13% |
Nickel (lb) | 7.25 | + 0.06 | 0.82% |
Zinc (lb) | 1.05 | – 0.03 | – 3.11% |
West Texas Crude | 76.46 | + 2.43 | 3.28% |
Brent Crude | 81.83 | + 2.51 | 3.16% |
Iron Ore (t) | 129.07 | + 2.04 | 1.61% |
Weakness continued in metal prices on Chinese concerns, but with China now closed for the week, the action should diminish.
The oils continue to tick higher on geopolitical risk.
The Aussie is up 0.4% at US$0.6516.
The SPI Overnight closed unchanged on Saturday morning.
The Week Ahead
As the US earnings season tapers off into its long tail, the local earnings season begins to ramp up this week. Reporters today include Aurizon Holdings ((AZJ)), Beach Energy ((BPT)) Car Group ((CAR)) and JB Hi-Fi ((JBH)).
From the macro perspective, the US January CPI release on Tuesday will add more to the “when” question regarding the first Fed rate cut. The PPI follows on Wednesday.
The US will also see retail sales, industrial production housing starts and consumer sentiment.
China will be closed all week for the New Year holiday.
Japan is closed today, ahead of its December quarter GDP release on Thursday, along with the UK GDP.
In Australia we’ll see the NAB business and Westpac confidence surveys tomorrow, along with January jobs on Thursday.
It’s a busy week next week at both the macro and micro levels.
FNArena's Corporate Results Monitor: https://fnarena.com/index.php/reporting_season/ (with calendar).
The Australian share market over the past thirty days…
Index | 09 Feb 2024 | Week To Date | Month To Date (Feb) | Quarter To Date (Jan-Mar) | Year To Date (2024) |
---|---|---|---|---|---|
S&P ASX 200 (ex-div) | 7644.80 | -0.71% | -0.47% | 0.71% | 0.71% |
BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS | |||
APE | Eagers Automotive | Downgrade to Neutral from Buy | Citi |
CSR | CSR | Downgrade to Hold from Add | Morgans |
Downgrade to Sell from Buy | UBS | ||
GUD | G.U.D. Holdings | Downgrade to Neutral from Buy | Citi |
NWS | News Corp | Upgrade to Outperform from Neutral | Macquarie |
PPM | Pepper Money | Downgrade to Neutral from Buy | Citi |
PWR | Peter Warren Automotive | Downgrade to Neutral from Buy | Citi |
For more detail go to FNArena's Australian Broker Call Report, which is updated each morning, Mon-Fri.
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CHARTS
For more info SHARE ANALYSIS: AGL - AGL ENERGY LIMITED
For more info SHARE ANALYSIS: AZJ - AURIZON HOLDINGS LIMITED
For more info SHARE ANALYSIS: BLD - BORAL LIMITED
For more info SHARE ANALYSIS: BOE - BOSS ENERGY LIMITED
For more info SHARE ANALYSIS: BPT - BEACH ENERGY LIMITED
For more info SHARE ANALYSIS: CAR - CAR GROUP LIMITED
For more info SHARE ANALYSIS: COH - COCHLEAR LIMITED
For more info SHARE ANALYSIS: JBH - JB HI-FI LIMITED
For more info SHARE ANALYSIS: LTR - LIONTOWN RESOURCES LIMITED
For more info SHARE ANALYSIS: PDN - PALADIN ENERGY LIMITED
For more info SHARE ANALYSIS: STO - SANTOS LIMITED
For more info SHARE ANALYSIS: WDS - WOODSIDE ENERGY GROUP LIMITED