Volatility appears to be the new norm, as US treasury yields fall, along with most global bonds and international markets around the world fall.
Overnight we saw the Dow Jones snap its three-day up trend, falling 0.7 per cent, with the S&P500 down the most (0.8 per cent) and the Nasdaq down 0.7 per cent as well. Nevertheless, the US market and the Aussie market have recovered a large chunk of Wednesday 14 August’s loss, which fuelled our loss on Thursday 15 August (when the benchmark S&PASX200 shed 2.9 per cent).The local bourse has mostly erased yesterday’s market lift of 1.2 per cent, after losing 1.1 per cent earlier. Now, the ASX200 is about 5.9 per cent off the all-time high of late July.
The Aussie dollar remains low, at 67.82US or thereabouts which is boding well for the mining sector, but even materials are mostly lower, while gold players like Newcrest Mining (ASX:NCM) are up 0.5 per cent, with Saracen (ASX:SAR) up 2.5 per cent.
The S&P/ASX 200 index is 0.9 per cent or 58 down at 6,488. On the futures market the SPI is 1.2 points lower.
Citi came out today after BHP’s (ASX:BHP) reported yesterday, with the research house Citi, saying the mining heavyweight’s result was a modest miss, but FY20 should be better. Despite reducing FY20E EPS 9 per cent on higher costs in Copper and QLD coal, Citi forecasts underlying profit of $11.9 billion given higher iron ore prices. Citi’s 12-month target price is $39.00. Year-to-date is shares are up 4 per cent, year-on-year its up 9 per cent. Its trading at $35.66.
Australia's largest gaming and entertainment group, Crown Resorts (ASX:CWN) reported attributable net profit fell 28.1 per cent in the financial year 2019, compared to the 2018, hitting $401.8 million (in actual terms) blaming subdued market conditions and drop in VIP revenue. Revenue also slipped, falling 5 per cent to $2.9 billion. Dividends remained stead, a final dividend of $0.30 cents per share was declared (total full year dividend was 60 cents per share). VIP program play revenue in Australia, fell 26.1 per cent to $38.0 billion. Shares in Crown Resorts (ASX:CWN) are trading 0.3 per cent higher at $11.4 at noon. Year-to-date its shares are down 3.6 per cent
Novated leasing, salary packaging and fringe benefits tax admin and management company, McMillan Shakespeare (ASX:MMS) reported its attributable profit rose to $63.7 million, while its underlying net profit after tax and acquisition amortisation (UNPATA) fell 5 per cent $88.7 million in the financial year ending 30 June 2019. Group revenue saw an uptick of 0.8 per cent to $549.7 million, with its new novated lease sales outperforming the market. Shares in McMillan Shakespeare (ASX:MMS) are trading 16.7 per cent higher at $15.32 at noon. Year-to-date to its shares are 10 per cent higher. Over the longer term, its shares are up 17.8 per cent over five years.
Best and worst performers
The best-performing sector is S&P/ASX Health Care, losing 0.1 per cent, while the worst performing sector is S&P/ASX Consumer Staples, shedding 1.8 per cent.
The best performing stock in the S&P/ASX 200 is Mcmillan Shakespeare Limited (ASX:MMS), rising 16.7 per cent to $15.32, followed by shares in Carsales.com (ASX:CAR) and Wisetech Global Limited (ASX:WTC).
The worst performing stock in the S&P/ASX 200 is The a2 Milk Company Limited (ASX:A2M), dropping 14.1 per cent to $13.74, followed by shares in Nearmap Ltd (ASX:NEA) and Iluka Resources Limited (ASX:ILU).
Japan’s Nikkei has lost 0.5 per cent, Hong Kong’s Hang Seng has shed 0.2 per cent and the Shanghai Composite has lost 0.1 per cent.
Commodities and the dollar
Gold is trading at US$1,505 an ounce.
Iron ore price fell 0.5 per cent to US$87.94
Iron ore futures are pointing to a fall of 4.3 per cent.
One Australian dollar is buying 67.86 US cents.