Market Wrap: Aus shares close 0.7% higher

Market Reports

by Clive Tompkins

Despite weak leads from the US, the Australian share market performed strongly today.

The local bourse spent the entire day in positive territory and has finished 0.7% higher. It was boosted by the performance of big banks – with all four finishing stronger today.

The market was dragged down slightly by a number of companies that posted disappointing financial results today. In particular, companies in the Mining and Energy sectors (such as Caltex, Monadelphous and Oil Search) have reported lower profits due to the downturn in commodity prices.

The S&P/ASX 200 index closed 39 points up to finish at 5,554.

The value of trades was $5.5 billion on volume of 801 million shares at the close of trade. The top three stocks by value were CBA, BHP and TLS

On the futures market the SPI is 28 points up.

Economic news

The ANZ-Roy Morgan consumer confidence index has rose 3.6% to 121.8 last week. This is a 3-year high, and certainly the highest reading since November 2013. Households’ views on the 12-month economic outlook, and confidence towards their own finances have also risen strongly.

Company news

Oil Search Ltd (ASX:OSH) has reported an 89% slide in net profit after tax. In the first half ending 30 June 2016, its profit was US$25.6 million (compared to US$227.5 million in the same period last year). The company declared an interim dividend of just $US0.01 cent per share, unfranked. The company says sales volumes increased, but total revenue dropped 33% due to “materially lower” commodity prices. Shares in Oil Search closed 0.81 per cent down at $7.38.

Monadelphous Group (ASX:MND) has reported its net profit fell 37% to $76 million in the full year ended 30 June 2016. The company says this was due to a downturn in commodity prices, and its customers in the Energy and Resources sectors focusing on reducing capital expenditure.

Kogan.com Ltd (ASX:KGN) has reported better-than-expected results. The company’s sales revenue of $211.2 million beat its pro forma forecast by 5.4%, and was boosted by its recent acquisition of Dick Smith.

Prime Media Group Ltd (ASX:PRT) reported a net loss of $93.5 million, and its revenue fell 7.7% to $238.8 million in the 2016 financial year. The company says it remained under revenue pressure due to declining audience numbers for regional TV.

Best and worst performers

The best performing sector for today was Healthcare – adding 1 per cent to close at 22,086.

The worst performing sector was Energy, losing 0.4 per cent to close at 8,698 points.

The best performing stock in the S&P/ASX 200 was Bellamys, rising 5.29 per cent to close at $14.94. Shares in Whitehaven Coal and Bluescope Steel also closed higher.

The worst performing stock was Monadelphous, dropping 17.75 per cent to close at $8.99. Shares in Worely Parsons and Syrah Resources also closed lower.

Commodities

Gold is trading at $US1,339 an ounce.
Light crude is $1.70 down at $US47.41 a barrel.
The Australian dollar is buying $US0.7642.
 

Are you a 708 sophisticated investor?

A sophisticated investor is defined under Section 708 of the Corporations Act (net assets of $2.5 million or annual incomes in excess of $250,000).

They are eligible to receive information regarding wholesale investment opportunities that are not available to regular or retail investors.

Please subscribe if you would like to be alerted to these types of opportunities.