The Match Out: ASX pinned to 7400, Tech catches a bid, EML Payments rockets on CBI news

James Gerrish

Market Matters

Another quiet day on the index level, any strength was sold, weakness bought and overall the market finished flat, however there was a lot more happening under the hood. At a sector level, IT stocks bounced back strongly from recent weakness, materials also rallied and that supported MM’s current positioning, while the Financials and Staples sectors were both weak.

  • The ASX 200 finished +7pts/+0.11% today at 7407.
  • IT Stocks were strong, finishing up 2.4%.
  • EML Payments (ASX: EML) +31.27%, rocketed today on a surprisingly positive regulatory update – Harry covers below.
  • NRW Holdings (ASX: NWH) +8.44%, held its AGM and they reconfirmed revenue guidance with a higher degree of certainty, plus talked a big order book.
  • Market Matters Weekly Video Update: This week Harry and James talk about the rationale for buying Fortescue Metals (ASX: FMG), why we like AGL Energy (ASX: AGL) for the Income Portfolio and our view around Aussie Broadband (ASX: ABB) with some discussion around timing an entry. Click Here to View or visit your Dashboard Here.
  • Kogan.com (ASX: KGN) was sold off on soft commentary at their AGM today.
  • Gold was up in Asia, -$US3 to trade $US1792 at our close.
  • January Iron Ore Futures rose around 2% today in Asia.
  • Asian markets were mixed, Nikkei +0.54%, Hong Kong marginally up just 0.1% while China was down -0.10% at the time of writing.
  • US Futures are higher, S&P 500 Futures the standout, up 30bps.

ASX 200

EML Payments (ASX: EML) $3.61

EML +31.27%: the payments company got a boost today after updating the market around the regulatory issues in Ireland. The PCSIL business was in the firing line from the Central Bank of Ireland earlier this year for money laundering issues and has been working with the regulator since to resolve it. Today’s update suggests the bulk of the work has been completed and the CBI is now allowing the business to grow again. It’s only around 25% of the company’s revenue yet the stock was hit closer to 50% since the announcement.

MM remains bullish and long on EML in the Emerging Companies portfolio.

EML Payments (EML)

NRW Holdings (ASX: NWH) $1.735

NWH +8.44%: rallied today after the mining and civil construction services company said its order book is expected to grow to at least $4.4 billion, while they also maintained revenue guidance of $2.4b to $2.5b, but with a higher degree of certainty. While mining services stocks have their challenges, labour being only one of them, trading on around 8x FY22 earnings while yielding 6% + now with some earnings certainly we think NWH should be trading with $2 in front of it in short order.

MM is bullish on NWH.

NRW Holdings (NWH)

Broker Moves

  • Webjet Raised to Add at Morgans Financial Limited; PT A$6.60
  • Australian Vintage Cut to Hold at Morgans Financial Limited
  • Deterra Rated New Buy at Canaccord; PT A$5.10
  • SCA Property Cut to Equal-Weight at Morgan Stanley; PT A$2.95
  • Charter Hall Retail Cut to Underweight at Morgan Stanley
  • Newcrest Rated New Buy at Jefferies

Major Movers Today

Have a great night

James, Harry and the Market Matters Team.

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Portfolio Manager
Market Matters

James is Portfolio Manager & Primary Author at Market Matters, a daily investment report with over 2500 subscribers that offers real market insight. He is also Senior Portfolio Manager within Shaw and Partners heading up a team that manages...

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