The Match Out: A strong GDP can’t stop the ASX from sliding away

The daily Match Out for Wednesday 6 September with James Gerrish of Market Matters.
James Gerrish

Market Matters

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The ASX drifted lower throughout the day with no meaningful leads from overseas indices, and better-than-expected economic growth was ignored with some investors potentially guilty of considering September's negative seasonal reputation.

  • The ASX 200 finished Wednesday down -57pts/-0.78% at 7257.1 – near the day’s lows, from bullish to bearish in 24 hours!
  • The Energy sector was best on the ground advancing +1.1% while the other 10 sectors all ended the day lower.
  • Tech (-1.51%) and Industrials (-1.31%) were the weakest links while Consumer Services also fell (-1.29%).
  • Australia’s economy is growing faster than expected with the GDP expanding +0.4% in the second quarter, up from +0.2% in the previous quarter and +0.3% that was expected.
  • Bond yields edged higher on the news but again the $A paid no attention to a theoretically good number.
  • The ASX drifted lower through the day after the release as the need for interest rates to be higher for longer gained traction with investors.
  • NSW Treasurer announced that coal royalties will be hiked by +2.6% from July’24, the first such move in 15 years in an effort to boost the ailing economy – the important takeout being the acknowledgement that we need coal power for longer.
  • The net bullish news for coal sent related stocks higher with New Hope (ASX: NHC) +0.5% and Whitehaven (ASX: WHC) +0.47% both enjoying the announcement and its implications.
  • Orora (ASX: ORA) tumbled -12.44% on its first day of trading since announcing a $1.2 billion capital raise to fund the Saverglass deal.
  • Macquarie Group (ASX: MQG) fell -3.8% after pushing back its asset sales into the 2H putting a brake on short-term profits.
  • Qantas Airways (ASX: QAN) rallied another +1.1% post-Alan Joyce as the company enters a new era with customers back in focus, it’s about time!
  • Altium (ASX: ALU) caught our eye in the loser's enclosure falling almost 4.4% on no obvious news although the day did have a “profit-taking” feel about it.
  • ResMed (ASX: RMD) -2.8% on concerns from UBS around Ozempic weight loss drug and a rising number of competitors.
  • Iron Ore was up just over 1% in Asia, as it continues to defy the bears with the Futures trading ~US$119/mt
  • Gold hardly moved throughout the Asian session trading at US$1953 at our close.
  • Asian stocks were firmer but nothing dramatic, Hong Kong was up +0.2%, Japan +0.60% and China fell -0.20%
  • US Futures are all down circa -0.10%

ASX 200 Intraday

ASX 200 Daily

Broker Moves

  • Premier Investments Cut to Neutral at JPMorgan; PT A$25.50
  • Woolworths Group Raised to Neutral at JPMorgan; PT A$38.40
  • JB Hi-Fi Raised to Overweight at JPMorgan; PT A$52
  • Harvey Norman Cut to Underweight at Morgan Stanley; PT A$3.50
  • Cochlear Cut to Underweight at Morgan Stanley; PT A$240
  • TNC AU Rated New Speculative Buy at Morgans Financial Limited
  • PolyNovo Rated New Add at Morgans Financial Limited; PT A$1.88
  • Webjet Raised to Hold at Jefferies; PT A$7

Major Movers Today

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James Gerrish
Portfolio Manager
Market Matters

James is the Lead Portfolio Manager & primary author at Market Matters, a digital advice & investment platform with over 2500 members that offers real market intel & portfolios open for investment. He is also a Senior Portfolio Manager at Shaw and...

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