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ASX recovers to flat as Sydney lockdown smashes travel

Daily Market Update

ASX fights back, COVID winners back as lockdowns extended, oil at three-year high

The ASX 200 (ASX: XJO) overcame a negative lead to finished broadly flat on Monday.

COVID-19 outbreaks in almost every state barring Victoria have sent the market back into the realm of 2020’s top trades.

  • On the one hand, travel and tourism-facing stocks suffered, with Qantas Airways Limited (ASX: QAN) falling 4.0% and Flight Centre Travel Group Ltd (ASX: FLT) down 3.4%.

    On the other hand, COVID-19 beneficiaries including online furniture retailer Temple & Webster Group Ltd (ASX: TPW) and Kogan.com Ltd (ASX: KGN) jumped 10.2% and 6.6%, respectively. This is clearly sentiment driven with both having fallen heavily as comparable sales figures came into focus.

    On the more sustainable side, Wesfarmers Ltd (ASX: WES) and Woolworths Group Ltd (ASX: WOW) continue to gain, up 1.3% and 2.9% respectively, with staples like groceries likely to sustain beyond the short-term.

    ASX coal miners were hit hard by a Chinese spokesperson suggesting that the supply crunch of the commodity in China was set to ease.

    The announcement highlighted the growth of renewable energy in the country along with the increase in domestic production as key reasons behind the expected price reduction.

    Oil rises, Metcash delivers, another gold miner disappoints

    The oil price hit a three-year high overnight as a lack of investment in supply combines with an expected recovery in demand.

    Despite the jump, Santos Ltd (ASX: STO) finished just 0.7% higher and remains below 2020’s high.

    Costa Group Holdings Ltd (ASX: CGC) shares fell 1.6% after settling the institutional portion of its placement, whilst junior gold miner Gold Road Resources Ltd (ASX: GOR) fell 7.4%.

    The miner downgraded production guidance due to disruptions at its processing plant, sending its costs higher and once again proving the poor hedge that miners can be.

    Metcash Limited (ASX: MTS) was the standout of the day, delivering a 40% increase in the dividend after a record year.

    The company reported a 9.9% increase in revenue to $14.3 billion and a 27% increase in profit to $252 million as the pandemic pulls it out of a decade-long malaise.

    Alcohol and hardware sales were the key contributor, with earnings up 22% and 62% in these divisions, and supported the purchase of another 15% of Total Tools for $59.4 million.

    The final dividend was 9 cents per share, taking the full-year payout to 17.5 cents but sending the share price just 0.8% higher.

    Tech takes the mantle, another trillion dollar winner, Facebook avoids court

    US markets were positive overnight, with the technology sector gaining 1% as the reflation trade peters out.

    The S&P 500 added 0.2% but the Dow Jones fell 0.4% after a number of countries around Europe and Asia banned British travellers amid a surge in COVID-19 cases in the country despite their solid level of vaccination. Cruise operators and airlines both sank on the news. 

    Facebook Inc (NYSE: FB) was the news of the day, with the share price jumping 4.2% and becoming the third company to reach a market cap of US$1 trillion.

    The surge came as the company had anti-monopoly cases against them dropped in the US, ensuring their dominance of ads is set to continue.

    The US markets are nearing one of their best half years in history with just three days of trade remaining, with the S&P and Nasdaq having hit 32 and 18 new records this year alone.

    Industrials, property push ASX lower, RBA hikes again, Woolworths guides to higher sales

    The local market fell sharply on the back of an unexpected 0.25 per cent interest rate increase by the Reserve Bank of Australia. The news took the cash rate to 3.85 per cent, adding more pressure to household balance sheets and came despite most experts suggesting hikes had come to an end. The hardest hit…

    Drew Meredith | 3rd May 2023 | More
    ASX boosted by the energy sector, Origin upgrades outlook, Best & Less gets a bid

    The local sharemarket finished 0.4 per cent higher on Monday, buoyed by the energy and utilities sectors, which gained 1.3 and 1 per cent, despite the oil price continuing to fall. The sector was buoyed by an earnings upgrade from Origin Energy (ASX:ORG) which sent shares 0.5 per cent higher with AGL Energy (ASX:AGL) also…

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    Upbeat start to week – and month – likely for Aussie market

    After a strong session for global markets on Friday, Australian shares will take a positive lead into the new week – and month. The Australian benchmark index, the S&P/ASX 200, added 16.5 points, or 0.2 per cent, on Friday, to 7,309.2, but eased 53 points, or 0.7 per cent over the week. ASX futures trading…

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