ASX at eight-day high, most S&P500 companies top earnings est’: Aus shares 0.3% higher at noon

Market Reports

by Jessica Amir

The Australian share market clawed back from its loss yesterday and is trading at an eight-day high, and now less than 0.8 per cent off fresh all-time highs hit earlier this month (5 July 2019). 

We had positive leads from US equites on Monday, with the Nasdaq rising the most, extending this year’s gain on the index to 23 per cent (year-to-date). According to FactSet, of the 15 per cent of the S&P500 companies that have reported results, the majority (78.5 per cent) have topped analysts’ expectations. And of course, the world still awaits the US Fed’s interest rate decision at its month-end meeting.

The S&P/ASX 200 index is 0.3 per cent higher or 23 points up at 6,714. On the futures market the SPI is 0.3 per cent higher.

Broker moves

Citi Research says Flight Centre Travel (ASX:FLT) is the top pick for the research house in the Australian large cap retail space and it has maintained its buy rating with a 12-month price target of $49.20. Citi says there is the opportunity to close 77 Flight Centre stores amid the Flight Centre’s brand consolidation. Citi sees profit before tax upside of $7 million which could come from closing some of the 950 Flight Centre branded stores in Australia. Shares in Flight Centre Travel (ASX:FLT) are trading 2.2 per cent higher at $44.92.

Company news

Fortescue Metals Group (ASX:FMG) says China steel margins have moderated and it’s focus has moved to input costs. FMG. has highlighted that Chinese steel mill profits are driving iron ore price spreads. FMG FMG has also noted the increased demand for lower iron products from the region. Shares in Fortescue Metals Group (ASX:FMG) are trading 0.6 per cent lower at $8.85 at noon. Year to date, FMG (ASX:FMG) shares are up 111 per cent.

After St Barbara (ASX:SBM) completed the purchase of TSX listed, Atlantic Gold Corporation for $780 million, the gold miner hired Steven Dean, the former chairman and chief executive officer of Atlantic Gold, to its board (effective 23 July 2019). The mining exec has worked as the President of Teck Resources, (TSX:TECK.A and TECK.B, NYSE:TECK). Teck is Canada's largest diversified resource company, and the the largest producer of metallurgical coal in North America. Shares in St Barbara (ASX:SBM) are trading 0.3 per cent lower at $3.53 at noon.

Best and worst performers

The best-performing sector is S&P/ASX Consumer Discretionary, adding 0.8 per cent, while the worst performing sector is S&P/ASX Materials, shedding 0.2 per cent.

The best performing stock in the S&P/ASX 200 is Aveo Group (ASX:AOG), rising 5.1 per cent to $2.04, followed by shares in Bellamy's Australia Limited (ASX:BAL) and Nearmap (ASX:NEA).

The worst performing stock in the S&P/ASX 200 is Domain Holdings Australia Limited (ASX:DHG),dropping 6.9 per cent to $2.85, followed by shares in Regis Resources Limited (ASX:RRL) and Resolute Mining Limited (ASX:RSG).

Asian markets

Japan’s Nikkei has risen 0.8 per cent taking this year’s gains to 10.5 per cent, Hong Kong’s Hang Seng has lost 0.01 per cent (this year it’s up 9.7 per cent), and the Shanghai Composite has added 0.06 per cent (this year it’s added 17 per cent). 

Commodities and the dollar

Gold is trading at US$1,419 an ounce.
Iron ore price fell 2.1 per cent to US$118.33, still holding around five-year highs.
Iron ore futures are pointing to a fall of 0.3 per cent.
One Australian dollar is buying 70.29 US cents.