Healthcare sector sees biggest gain a year: Aus shares close 0.4% higher

Market Reports

by Jessica Amir

It was a positive day of trade for the Aussie share market rising 0.4 per cent. We had positive leads from the get go today as US equities erased their losses from the prior session, on Donald Trump pushing back the new 10 per cent tariff on $300 billion of Chinese goods to December 15, instead of September 1.

Several key items were also removed from the China tariff list altogether, from cell phones, laptops, video game consoles and some clothing products, shoes and “certain toys.” That saw Apple's shares jump 4.2 per cent, Best Buy soared 6.5 per cent. As for the major indices, the S&P500 rose 1.5 per cent, the Dow added 1.4 per cent, and the Nasdaq shone the most, up about 2 per cent as Apple shares jumped on the tariff news.

Turning back home, the Aussie dollar against the US remains at multi-year lows trading at March 2009 levels. And most of the sectors on the ASX finished in positive territory with the healthcare seeing its biggest gain in a year, hitting a fresh high earlier in the session. We saw CSL (ASX:CSL) shares gain 6.6 per cent on their results, while the lower AUD is also helping that business as well. While iron ore major Pilbara (ASX:PLS) hit a month high, showing positive momentum after trading at late 2017 levels.

At the closing bell the S&P/ASX 200 index closed 27 points higher to finish at 6,596. Now 4.1 per cent away from the new all-time high hit late July 2019.

Futures market

Dow futures are suggesting a fall of 30 points.
S&P 500 futures are eyeing a fall of 3 points.
The Nasdaq futures are eyeing a fall 3 points.
And the ASX200 futures are eyeing a 0.8 per cent rise.

Economic news

The seasonally adjusted Wage Price Index (WPI) rose 0.6 per cent in the June quarter 2019 (according to fresh data from the Australian Bureau of Statistics (ABS). That was more than the 0.5 per cent the market was expecting. Meanwhile, through the year, wages rose 2.3 per cent, in line with expectations.

Company news

Aveo (ASX:AOG) has entered into a scheme implementation deed to be taken over by BidCo and TopCo, entities of Brookfield for $1.27 billion. Aveo shareholders stand to receive total cash of $2.195 per security (including the FY19 annual distribution of 4.5 cents per security. Welcome news for shareholders as the takeover is a multiple of 29 times its FY19 EV/ unaudited EBITDA. Shares in Aveo Group (ASX:AOG) closed 5.5 per cent higher at $2.12.

Pact Group Holdings (ASX:PGH) reported a swing into negative-result -territory on higher raw material costs, higher energy costs and weaker demand. As a result, its FY18 net profit after tax of $74 million tumbled to a 2019 FY net loss after tax of $290 million. The board also scraped a final dividend, (while last year its final dividend was 11.5 cps). Shares in Pact Group Holdings (ASX:PGH) closed 16.9 per cent lower at $2.31.

CSL (ASX:CSL) shares hit an all-time high after it reported an 11 per cent jump in its net profit to US$1.9 billion on the back of growth in its largest antibody (anti-infection) portfolio immunoglobulin. It fuelled total earnings per share to rise 16 per cent. Group revenue also rose 11 per cent to US$7.9 billion on the back of increased demand for its blood-based therapies, while demand for seasonal flu vaccines also bolstered sales.

Betting giant, Tabcorp (ASX:TAH) reported its NPAT grew over 100 per cent for the year ending 30 June, hitting $365.5 million, accelerated by digital lotteries growth of 74 per cent.

National Australia Bank (ASX:NAB) released its third quarter trading update, with $1.70 billion in unaudited statutory net profit and $1.65 billion in unaudited cash earnings. That’s a 1.0 per cent lift cash earnings growth compared to the same quarter last year and is in line with Citi estimates.

Best and worst performers of the day

The best performing sector was Health Care, adding 4.5 per cent while the worst performing sector was REITs, shedding 0.9 per cent.

The best performing stock in the S&P/ASX 200 was Eclipx Group (ASX:ECX), rising 7.2 per cent to close at $1.55. Shares in CSL (ASX:CSL) and Pilbara Minerals (ASX:PLS) followed higher.

The worst performing stock in the S&P/ASX 200 was Pact Group Holdings (ASX:PGH), dropping 16.9 per cent to close at $2.31. Shares in Saracen Mineral Holdings (ASX:SAR) and Northern Star Resources (ASX:NST) followed lower.

Asian markets

Japan’s Nikkei has gained 1 per cent, Hong Kong’s Hang Seng has gained 0.6 per cent and the Shanghai Composite has gained 0.6 per cent.

Commodities and the dollar

Gold is trading at US$1,502 an ounce.
Iron ore price is trading 5.2 per cent lower at US$89.25.
Iron ore futures are pointing to a rise of 2.2 per cent.
Light crude is US$1.87 up at US$56.72 a barrel.
One Australian dollar is buying 67.92 US cents.

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