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Heavyweights outperform to lift ASX

Daily Market Update

ASX hits four day high, gold shining again, growth bubble stalling 

The ASX200 hit a four-day high, finishing 0.6% to the positive on Tuesday; showing the short-term focus of the market at the moment.

The energy and materials sectors were the biggest contributors, jumping by 1.6% each.

  • For energy, it was the case of oil prices hitting another medium-term higher overnight, sending the likes of Woodside Petroleum (ASX:WPL) 2.1% higher.

    This came despite the company effectively writing off its large investment in the Kitimat LNG in Canada, costing US$60 million just to exit the asset.

    Gold bullion has been the story of the week, moving closer to US$1,900 per ounce as both inflation concerns and volatility increase, Evolution (ASX:EVN) finished 4.9% higher. 

    As has been proven time and again in the commodities sector, a rising price does guarantee strong returns.

    But this wasn’t enough to save fellow ASX miner Santa Barbara Ltd (ASX: SBM), which fell 9.0% after downgrading production guidance and flagging higher costs per ounce than expected.

    2020’s popular tech names including Redbubble (ASX:RBL), down 4.2%, and Kogan (ASX:KGN) continue to struggle to keep up with growth expectations.

    James Hardie set to resume dividends, Nuix says sorry

    Building products supplier James Hardie (ASX:JHX) fell 4.5% after warning that inflation pressures are beginning to build in their supply chain.

    As highlighted in this column, these are self-inflicted by a business sector that cut orders and inventory during the pandemic and is now seeking to ramp up quicker than what is possible.

    The company cited cost pressures in their pulp, pallet, and freight costs which are expected to be a US$150 million headwind to profit.

    It did report a 9% increase in profit for the half, to US$262.8 million on the back of a 12% increase in sales to US$2.9 billion.

    In a positive move, dividends are set to resume in November after being on hold since the pandemic.

    Improvement is being made at what could be the worst IPO in recent memory, Nuix Ltd (ASX:NXL), which jumped 11.5% today.

    Talking to investors, both the Chair and CEO said sorry, taking responsibility for the fact that the company may not have been prepared for ASX-listed life. They committed to improving governance and transparency in their pursuit of a share price recovery.

    Global markets continue to slide, Walmart’s upbeat forecasts, oil falls

    US markets fell across the board on Tuesday, the Dow Jones and S&P500 leading the market lower, both falling 0.8% as housing figures and oil prices dragged down the consumer and energy sectors.

    On the one hand, it was talk of a new US-Iran Nuclear deal suggesting the supply of oil would improve, meanwhile there was a 9.5% month-on-month fall in housing starts in April. The economy is clearly looking more mixed than headlines results suggest.

    Walmart (NYSE:WMT) finished 2.2% higher after upgrading guidance for the remainder of the financial year, as early sales showed a continued recovery.

    Comparable sales increased 6% in the quarter, excluding fuel, and up 16% when compared over the last two years rather than just the COVID-19 impacted comparables. Online sales were 37% higher, suggesting the transition to digital is continuing to pay off. 

    Despite upgrading guidance, management flagged higher wage costs and inventory issues as threats to the recovery along with the need to keep winning new customers.

    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…

    Drew Meredith | 2nd May 2023 | More
    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…

    James Dunn | 1st May 2023 | More