The Match Out: Bank dividends offset healthcare strength, US Inflation in focus

The daily Match Out report for Wednesday 10 May with Market Matters' James Gerrish.
James Gerrish

Market Matters

Another day of intra-session buying on the ASX which battled back from early session lows to close marginally down. The headline index move was largely a result of ex-dividends from NAB and BOQ, NAB’s dividend alone is worth ~10pts to the index. There was a pretty muted reaction to last night’s Federal Budget with no clear winners from a sector point of view, though Healthcare was probably the main beneficiary from the markets perspective. The focus tonight will be on US Inflation numbers which will have big ramifications on whether the Fed is near an end to its tightening cycle.

The ASX 200 finished down -8pts / -0.12% at 7255

  • The Healthcare sector was best on ground (+0.96%) while Real Estate (+0.34%), Consumer Discretionary (+0.22%) and Tech (+0.2%) were the other sectors in the black.
  • Financials (-0.54%) and Telcos (-0.38%) the weakest links.
  • Uranium stocks were strong today on the back of a report from Bank of America talking up the Global X Uranium ETF (NYSE: URA), Paladin (ASX: PDN) seeing the biggest move of the large caps, up +8.45. This will be in focus in tomorrow’s Morning Report
  • SRG Global (ASX: SRG) +4.17% upgraded earnings guidance, including the recent acquisition of Asset Care. More on that below
  • Dicker Data (ASX: DDR) +6.12% hit a ~3-month high on a positive quarterly update last night. 1Q Revenue for the computer hardware & software company was up 15% on 1Q22 with margins continuing to improve.
  • CSR (ASX: CSR) -2.56% reported FY numbers which were slightly ahead of consensus, EBIT of $330m vs $319 expected. Guidance was mixed though with the building products division continuing to do well, margins expected to remain at the current and a backlog of work providing good growth support, however, Aluminium is expected to fall into a loss in FY24.
  • Portfolio Manager James Gerrish joined Ausbiz today to talk about the budget’s impact on the ASX today – Click Here to watch.
  • US Inflation data tonight will be watched closely, Expectations are for the headline figure to come in at +0.4% MoM vs +0.1% last month, while Core is expected in line with the last print at +0.4% MoM.
  • Iron Ore was ~0.15% higher in Asia while Coal prices slide a further -0.5%.
  • Gold softened in Asia, down -0.3% settling $US2028 at our close.
  • Asian stocks were weak today, Nikkei -0.4% holding up the best while Hong Kong fell -0.5% and China -1.40%.
  • US Futures are all up, S&P and Nasdaq both ~0.15% higher.  


SRG Global (ASX: SRG) 75c

SRG +4.17%: the engineering and contracting company upgraded FY23 EBITDA guidance by ~8% today, largely on the inclusion of the recently acquired Asset Care business from ALS. The new division is expected to contribute $4.5-5m in EBITDA, while there was a slight upgrade to the performance of the rest of the business with the company tightening the guidance range to $79-80m We spoke to management today, and they were very pleased with the progress of the integration of the acquisition saying cross-sell opportunities had already presented themselves and is expected to be incrementally positive over the next few years.

SRG Global (ASX: SRG)

Broker moves

  • Centuria Capital Rated New Buy at Barclay Pearce Capital
  • Janus Henderson GDRs Raised to Neutral at Credit Suisse
  • Monadelphous Raised to Neutral at Citi; PT A$12.80

Major movers today

Have a great night

The Market Matters Team

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James Gerrish
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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