Home / Daily Market Update / Worst session in three weeks as ASX slips 0.7%

Worst session in three weeks as ASX slips 0.7%

Daily Market Update

Tech sell off weighs on ASX, Challenger downgrades earnings, Latitude finally lists

The ASX200 (ASX:XJO) moved further from a record close as a weak global lead and a bevy of early earnings updates sent the market 0.7% lower.

The only highlight was the telecommunications sector which added 0.2%, with IT and healthcare falling over 1% each as valuation concerns linger.

  • Challenger Financial Group (ASX:CGF) which provides annuities and distributes a series of investment funds, fell by over 15% after management downgraded earnings guidance to the lower end of their $390 to $440 million range.

    The group cited an unexpected decline in credit spreads as a key influence, with the returns on their statutory fund falling compared to the fixed rate annuity payments they are contracted to make.

    Despite the short term weakness, the company reported it had reached $100 billion in assets and delivered a record 9.2% growth in its Life book for the quarter. 

    Consumer lending group Latitude Financial (ASX:LFS) finally listed on the ASX, a slimmed down version of the company it was 18 months ago, with the company closing at $2.70 after listing at $2.6 on a $2.6 billion valuation.

    A recent pivot into BNPL has supported customer growth and complements their core personal lending, credit card, and car loan divisions.

    Afterpay continues to roll, Hub24’s record inflows, Rio’s best start to a year

    Afterpay Ltd (ASX:APT) has flagged a potential US listing as the group’s overseas operations finally exceed their Australian income.

    Management reported a 104% increase in sales to $5.2 billion for the quarter, with US sales up 211%, and UK sales up 277%, key drivers of the strength.

    Active customers increased by 75% to 14.6 million, with active merchants also hitting 85,800, a 77% gain on this time last year; evidencing the exceptional growth this company is achieving. Shares fell 0.8% on the news.

    Investment platform Hub24 delivered record inflows of $1.9 billion, up 41% on 2020 levels with the company reaching assets of $51.4 billion; shares fell 2.6%.

    Rio Tinto has recorded its strongest start to the year since 2018, shipping 77.8 million tonnes of iron ore in the first three months, amid calls that the iron ore price could hit US$200 per tonne on weaker Brazilian output.

    Popular online furniture outlet Temple and Webster (ASX:TPW) has shown no signs of slowing down, reporting a 20% increase in April sales on the back of a 112% increase in revenue on this time last year. The group now has over 750,000 active customers, with shares jumping 1.5%.

    Markets fall on virus, earnings concerns, Netflix underdelivers, Apple launches new iMac and iPads 

    Global markets retreated overnight, pushed lower by surging virus cases as investors await more clarity as earnings season hits full gear this week.

    Energy and financials led the fall, pushing the Dow Jones down 0.8%, the S&P500 -0.7%, and the Nasdaq 0.9%. 

    Apple Inc (NYSE:AAPL) shares fell 1.3% despite announcing the first redesign of their iMac desktop in close to a decade.

    The group also launched a new iPad, both to include the TSMC designed chips replacing their long history with Intel. The stay-at-home trade sent iPad sales up 30% each quarter but investors are clearly wary of whether this can continue.

    Netflix Inc. (NYSE:NFLX) also disappointed adding just 4 million subscribers, well below the 15.8 million it gained for the same period in 2020 powered by the pandemic.

    Management highlighted the pull forward impact of the pandemic but reported a quarterly profit of US$1.71 billion, doubling from $542.2 million in the year before. Shares were down heavily in after-hours trading.

    Gucci was a rare highlight, with consumers sending comparable sales up 25% for the quarter as spending pivots from electronics and homewares to fashion.

    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