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Saturday 22

September, 2018 7:56 AM



CommSec Daily Report Thursday

CommSec Daily Report Thursday

Aussie shares are improving at lunch for just the third time in ten sessions despite the closure of US markets last night for a holiday.

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05.07.2018 12:49 PM

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Aussie shares are improving at lunch for just the third time in ten sessions despite the closure of US markets last night for a holiday. The ASX 200 is up by 0.5 per cent or 31pts to 6215 and is being led higher by the big banks.

While local stocks hit 10.5 year highs less than a fortnight  ago, the market has somewhat plateaued in what has been directionless trade so far this financial year. Tomorrow, billions in tariffs are expected to kick in for both the US and China. This includes $34bn on US imports into China and $50bn from the US on Chinese imports.

While most sectors are lifting, the major banks are pushing equities up most, followed by Telstra (TLS) together with gold and energy stocks. The price of oil is hovering around fouryear highs on a decline in US oil stockpiles last week and concerns relating to Iranian oil supply.

Woolworths (WOW) is up 0.75 per cent. Caltex (CTX) is paying the supermarket chain a one-off payment of approximately $50m to extend its fuel agreement for 15 years. Under the agreement, CTX and WOW will work together to rollout a co-branded food/petrol offering across 250 Caltex sites. CTX will operate the fuel stations and will pay WOW a royalty. WOW is still looking at either spinning off or selling its petrol business. CTX shares are up 2 per cent.

Rail freight operator, Aurizon (AZJ) is up 0.25 per cent despite news that workers will be going on strike due to failed negotiations over wages and work conditions.

Domino’s (DMP) is down 8 per cent following a downgrade from a major broker who highlighted some weakness in its Japanese business which it expects to hit profits. Keep in mind DMP shares have surged by 30 per cent in four months.

Bellamy’s (BAL) is down by 7 per cent after a broker cut its share price target for the Tasmania based infant formula maker citing challenges with short-term Chinese regulatory approval. A2 Milk (A2M) shares are edging a little higher. Earlier in the week it extended an agreement with Synlait for the supply of milk used in its products for an additional two years.

1.3bn shares have changed hands so far today worth $1.7bn. 519 stocks are up, 445 down and 359 are flat.

US markets come back online tonight after the 4 July holiday. The Federal Reserve’s Board minutes will be a highlight together with ADP employment statistics for June and an update on US trade.

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