The Match Out: Market takes a backward step to end a solid week
A softer session to end a positive week for the ASX with the first full week of local reporting proving to be okay. Energy rallied back today, and so too did the telcos while property lost some of yesterday’s lustre.
- The ASX 200 finished down -38pts/ -0.54% at 7036
- The Energy sector was best on ground (+2.31%) while Communications (+0.29%) & Staples (+0.20%) ended higher.
- Property (-2.01%) and IT (-1.80%) the weakest links.
- For the week the ASX 200 put on 0.24%, with more clarity around future interest rate policy certainly helping.
- Oz Minerals (OZL) +35.84% is the star for us following a takeover tilt from BHP while we also own St Barbara (SBM) -14.86% which fell on production numbers.
- eCommerce stocks catching some attention today, a theme that has been building for a while after a woeful 12 months. Think Temple & Webster (TPW) +5.91% and even Adore Beauty (ABY) +5.17% finding some (rare) love.
- TPG Telecom +2.79% also caught my eye today, this has been a quiet achiever in our Flagship Growth Portfolio – we still like it.
- Aussie Broadband (ABB) +3.66% also looks interesting here – worth keeping on your hitlist.
- IAG +1.08% higher on a solid FY22 update, showing better than expected insurance margin + guidance maintained.
- Iron Ore was down ~1% in Asia
- Gold was flat at ~US$1790
- Asian stocks were higher, Hong Kong +0.44%, Japan +2.63% while China was up +0.07
- US Futures are all up, around +0.20%
Insurance Australia Group (IAG) $4.66
IAG +1.08%: the insurance company reported FY22 numbers today which was largely as expected given some numbers had been pre-reported. Earnings were light with Cash Net Profit After Tax (NPAT) at $213m well blow consensus at $239m.
The 5c final dividend was also below market expectations however the stock rallied on an improving outlook. The positive was higher than expected reported insurance margin which improved substantially in the second half.
They maintained Gross Written Premium (GWP) growth at mid-to-high single digits and reported insurance margins to grow to 14-16%. Earnings will also be supported by higher interest rates. A typical sort of IAG update, this year wasn’t good but next year will be better!
Sectors This Week
Stocks This Week
- MACA Cut to Hold at Canaccord; PT A$1.03
- Arena REIT Cut to Neutral at Macquarie; PT A$4.74
- Eagers Cut to Underperform at Jefferies; PT A$9.25
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The Match Out: Market slides ahead of public holiday, US Fed to hike rates tonight, probably by 0.75%
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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...