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Friday 14

December, 2018 6:47 PM



CommSec Daily Report Tuesday

CommSec Daily Report Tuesday

The Australian sharemarket is barely hanging on to gains at lunch on Tuesday...

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27.11.2018 12:28 PM

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The Australian sharemarket is barely hanging on to gains at lunch on Tuesday, with the ASX 200 up 0.1 per cent thanks to modest gains across most sectors and follows solid gains in the US last night. The big picture remains little changed however, with local stocks down by more than 10 per cent since early October. The G20 Summit which kicks off on Friday in Argentina will be the major event of the week. Hopes of trade dispute progress between the US and China while far from certain could be well received by investors.

Commodity prices were mostly lower overnight which is a weight on some resource stocks. Iron ore slumped by 6.1 per cent to US$64.70/t. China has relaxed its stance towards winter production cuts while China’s demand for steel is a bit lower than expected. Fortescue (FMG), Rio Tinto (RIO) and BlueScope (BSL) are under pressure.

BHP Billiton (BHP) is bucking the trend, lifting by 0.5 per cent. The world’s largest miner said it may have found a potential new iron ore, copper and gold deposit in South Australia near its Olympic Dam operations.

The price of oil rose strongly last night by 2.4 per cent but follows an 8 per cent slump on Friday. The gains are helping the recently heavily sold energy stocks. Santos (STO) which has just completed its $2.15bn acquisition of Quadrant Energy is up by 1.7 per cent.

The results of a weekly consumer confidence survey showed that sentiment remains robust heading into the key Christmas trade period for retailers. Sentiment rose by 0.7 per cent over the past week to be above the long-term average. A strong job market, lower fuel prices and a slightly firmer Australian dollar may be helping.

Harvey Norman (HVN) is standing out among the retailers, lifting by 1.8 per cent. While it announced a slight fall in sales in Australia at its AGM, global sales have improved by 3 per cent between July and November.

The Banking Royal Commission continues which is keeping the market’s attention on the financials. National Bank (NAB), AMP, ANZ and Bendigo & Adelaide Bank (BEN) are all set to face questioning this week. The majors have slipped into negative territory on Tuesday despite a better start.

1.1bn shares have changed hands so far, worth $1.8bn. 457 stocks are up, 408 down and 336 are unchanged.

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