Australian shares closed higher on the day, energy and gold stocks offsetting losses from the banking and tech indexes, while investors awaited a central bank rate decision to combat pressures from soaring inflation.
At the closing bell, the S&P/ASX 200 was 0.34 per cent or 23.50 points higher at 6852.20.
FuturesThe Dow Jones futures are pointing to a rise of 81 points.
The S&P 500 futures are pointing to a rise of 7.25 points.
The Nasdaq futures are flat.
The SPI futures are pointing to a rise of 19 points when the market next opens.
Best and worst performersThe best-performing sector was Energy, up 3.97 per cent. The worst-performing sector was Communication Services, down 0.90 per cent.
The best-performing stock in the S&P/ASX 200 was Coronado Global Res
(ASX:CRN), closing 7.45 per cent higher at $1.73. It was followed by shares in Whitehaven Coal
(ASX:WHC) and Paladin Energy
(ASX:PDN).
The worst-performing stock in the S&P/ASX 200 was Imugene
(ASX:IMU), closing 8.16 per cent lower at $0.23. It was followed by shares in PointsBet Holdings
(ASX:PBH) and Life360
(ASX:360).
Macro Summary: Australia/New ZealandCentral banksRBA expected to hike by another 50 bp: The RBA is expected to raise the cash rate by another 50 bp to 2.35 per cent on 6 September (Bloomberg). Recent data has backed the case that consumer spending remains buttressed by strong financial buffers and low unemployment, giving the RBA the confidence to proceed with another outsized rate hike. However, economists have argued that the pace of tightening will slow thereafter given headwinds from inflation, rising interest rates (and the time lag between rate hikes and higher mortgage repayments), and falling house prices.
EconomyBest August month for Australian new car sales since 2017: Financial Review cited data from the Federal Chamber of Automotive Industries (FCAI), which showed a 17.3 per cent y/y increase in new vehicle sales in August. It was the strongest August for new car sales since 2017, attributed to an improvement in supply and resilient consumer demand.
More than $42b in dividends set to flow through to Australian investors: The Australian flagged the potential stimulatory effect of more than $42b in dividends that are being sent out this month. The article highlighted how the payments are set to bolster household balance sheets and provide consumers with additional spending firepower after retail sales climbed in July by the most in four months.
PropertyAustralia's banks lowering lending rates to new borrowers, even as RBA tightens: Financial Review highlighted how Australia's banks are still competing for borrowers by lowering the standard variable rate for new customers, even as the RBA continues with its tightening cycle. RateCity shows 24 lenders, including all four big banks, have reduced at least one variable rate for new customers. Still, that is not translating to credit growth after recent data showed a marked slowdown in the value of new home lending in July.
GovernmentAustralian government may make multi-employer bargaining compulsory: Financial Review noted the Australian government has not ruled out making multi-employer bargaining compulsory, despite business groups at last week's Jobs Summit being left with the impression it would be opt-in. Negotiations on multi-employer bargaining are slated to begin this week with the government aiming to prepare legislation by Christmas.
Australian dataQ2 business inventories +0.3 per cent vs consensus +1.5 per cent and +3.2 per cent in Q1
Company profits +7.6 per cent vs consensus +4.5 per cent and +10.2 per cent in Q1
July final retail sales +1.3 per cent m/m vs preliminary +1.3 per cent and +0.2 per cent in June
August ANZ job ads +2.0 per cent m/m vs revised (1.0 per cent) in July
August AIG construction index 47.9 and 45.3 in July
Asian marketsShares in the Asia-Pacific are trading mixed on Monday as the US dollar is strengthening sharply in Asia trade. Oil prices have risen more than 2 per cent ahead of an OPEC+ meeting slated to take place 5 September. The G7 reached an agreement to put a cap on Russian oil prices over the weekend.
Hong Kong’s Hang Seng index has fallen 1.28 per cent, leading losses regionally. In Japan, the Nikkei 225 and the Topix index are both fractionally higher.
The Shenzhen Component in mainland China has dipped 0.472 per cent, but the Shanghai Composite has risen slightly.
China’s Caixin Services Purchasing Managers’ Index came in at 55.0, compared with July’s print of 55.5.
In South Korea, the Kospi has shed 0.3 per cent. MSCI’s broadest index of Asia-Pacific shares outside Japan is 0.66 per cent lower.
Company newsKingwest Resources
(ASX:KWR) has announced that infill drilling completed by BML at the Selkirk Deposit has further confirmed the high-grade nature of the gold mineralisation. The Selkirk Deposit is a discrete gold project in the Menzies Gold Project with a Mineral Resource Estimate (MRE) of 11,500 oz. The MRE remains open at depth. The infill drilling was required prior to completing an updated MRE, an optimised pit shell and mine planning. Kingwest CEO Ed Turner commented that “BML is making good progress as we move towards recommencing production at Selkirk and these drill results give us more confidence in the resource as well as underpinning support the proposed cut back of the pit. The recommencement of commercial mining at Menzies after more than 20 years since open cut mining finished is significant and we expect this to be the first of a number of mining operations at Menzies that should deliver attractive short and medium-term cash inflow to KWR.” Shares closed 9.68 per cent higher at 6.6 cents.
Great Boulder Resources
(ASX:GBR) has announced new drilling results from the Side Well Gold Project in Western Australia. Great Boulder’s Managing Director Andrew Paterson commented: “This spectacular result is the highest-grade intersection and the highest individual gold assay drilled to date at Side Well. “It demonstrates that we’ve not yet closed off this high-grade vein area, which sits in the northern end of Mulga Bill containing many of the highest-grade intersections in the project." Shares closed 3.09 per cent higher at 10 cents.
Tamboran Resources
(ASX:TBN) has announced a significant upgrade to the Contingent Resources at the EP161 tenement in the Beetaloo Basin, which is operated by Santos. The unrisked gross best estimate for contingent resources has been increased by 164 per cent to 1.6 trillion cubic feet and follows the confirmation of successful flow results from the T2H and T3H wells. According to the company, the updated flow rates represent “a material derisking of the Beetaloo Basin” and that “both wells exceed what Tamboran believes to be the commerciality threshold for their assets in the Basin”. The company also commented that its 100 per cent owned and operated Maverick well in EP136 remains on track to be spudded shortly. Shares closed 4.26 per cent higher at 24.5 cents
Commodities and the dollarGold is trading at US$1711.77 an ounce.
Iron ore futures are pointing to a rise of 4.28 per cent.
Light crude is trading $1.82 higher at US$88.69 a barrel.
One Australian dollar is buying 67.89 US cents.
