By Greg Peel
Earnings in Focus
Wall Street was flattish on Friday night heading into the long weekend, leaving the local market to focus more specifically on the day’s earnings results yesterday. Results were, as ever, a mixed bag, leaving the ASX200 to bang around all day in a tight range, ultimately going nowhere.
That said, it was up the banks to hold the fort, rising 0.9% as all but two other sectors fell on the day, with staples and industrials closing up less than 0.1%.
Bendigo And Adelaide Bank Ltd (ASX:BEN) reported yesterday and closed up 1.9%. If a small regional can cope in current banking conditions then it should be good news for the majors. The sector has nevertheless spent a week trying to get over the Commonwealth Bank Of Australia (ASX:CBA) result.
Standing out amongst the poorly received results yesterday were those of NIB Holdings (ASX:NHF), down -11.6% after offering no guidance, Bluescope Steel Ltd (ASX:BSL), down -10.0% after downgrading its outlook, and A2 Milk Company Ltd (ASX:A2M), down -8.6% on weaker sales during Chinese lockdowns. Mind you, a2 Milk shares had rallied 6.3% the day before. Charter Hall Group (ASX:CHC) also disappointed (-6.1%).
Perenti Global Ltd (ASX:PRN) scored a contract win ahead of its result release this morning, and gained 7.6%.
Aside from a solid response to Australian Clinical Labs’ ((ACL)) result, up 12.5% but not in the ASX200, yesterday’s winners lent more to subsequent broker assessments of results released on Friday.
Inghams Group Ltd (ASX:ING) jumped 11.7%. Qbe Insurance Group Ltd (ASX:QBE) added another 3.7%. PWR Holdings Ltd (ASX:PWH) clawed back 4.4%.
Sector moves reflected big name stock price moves to a great extent. Real estate fell -1.0% on Charter Hall. Materials (flat) managed to balance out BlueScope and big falls for lithium and Uranium Futures miners against small gains for the big miners.
Pilbara Minerals Ltd (ASX:PLS) apparently upset the lithium apple cart by auctioning off lithium hydroxide via an over-the-counter commercial model rather than the BMX auction system it had been using.
Discretionary fell -0.4% because Wesfarmers Ltd (ASX:WES) went ex.
With Wall Street closed overnight, today will again be a session of focusing on result releases. Today brings the biggie – BHP Group Ltd (ASX:BHP). Will it disappoint on dividends?
Also reporting today are the likes of Coles Group Ltd (ASX:COL), Seek Ltd (ASX:SEK), Tabcorp Holdings Ltd (ASX:TAH) and Stockland Corporation Ltd (ASX:SGP).
The futures aren’t waiting for any results. With no Wall Street and mild strength in European markets, they’re down -29 points this morning.
Commodities
News is the US is looking to impose a 200% tariff on imports of Russian aluminium, as the West sets to roll out a new wave of sanctions. Russia is the second biggest global producer behind China, and Chinese inventories are reportedly low.
Base metal prices had a bit of a run ahead of China’s covid policy about-face, but any surge in Chinese construction activity has been slow to arrive – punctuated by the Lunar New Year – and base metal prices have been quietly sliding for a month.
Bit of a change of heart last night, and perhaps some short-covering.
The Aussie is up 0.6% at US$0.6913.
Today
The SPI Overnight closed down -29 points or -0.4%.
What are traders afraid of? Today’s earnings results? The minutes of the February RBA meeting, due today?
The world will provide flash estimates of February PMIs today.
Aside from earnings reporters noted above, today’s list of ex-dividends includes Computershare Ltd. (ASX:CPU), Endeavour Group Ltd (ASX:EDV) and Magellan Financial Group Ltd (ASX:MFG).
"The Overnight Report: Eye On Dividends" was originally published on FNArena.com and was republished with permission.