Intra day profit taking, but ASX holds 7-month high: Aus shares close 0.4% higher

Market Reports

by Jessica Amir

The Australian share market hit a new 7-month high today, but failed to maintain the new high with intraday profit taking capping gains.

Most of the sectors of the market rallied today with the smaller tech sector leading the way after Afterpay (ASX:APT) and Zip Co (ASX:Z1P) rose 2.2 per cent and 11 per cent respectively. 

At the closing bell the S&P/ASX 200 index closed 0.4 per cent or 25 points higher, to finish at 6,271.

Wall Street has continued to build on its strongest start to the year in 3 decades. On Friday, the S&P gained 0.7 per cent, hitting a new 4 month high, while the Nasdaq gained 0.8 per cent with Amazon shares rising 2 per cent on plans to open a low-price grocery chain

Futures

Dow futures are suggesting a gain of 125 points.
S&P 500 futures are eyeing a rise of 11 points.
The Nasdaq futures are eyeing a gain of 44 points.
And the ASX200 futures are eyeing a 10 point rise tomorrow morning

Local economic news

Inventories fell according to the Australian Bureau of Statistics (ABS) latest Business Indicators publication for the December quarter. Inventories fell 0.2 per cent in the quarter in seasonally adjusted terms, while over the year, it rose 1 per cent. This data is a direct input to Wednesday’s economic growth figures.

Dwelling approvals fell in January 3.2 per cent in January in trend terms, while total dwellings rose 2.5 per cent in January in seasonally adjusted terms with the most approvals seen in WA (28.8 per cent). Dwelling approvals are a leading indicator for home building.

Company news 

Bubs Australia (ASX:BUB) clarified the terms of the supply agreement with Tatura Milk Industries. This agreement is for converting fresh goat milk directly from farm gate into infant formula in one step. The deal is for an initial 3 years with the possibility of extending the terms. Shares in Bubs Australia (ASX:BUB) shares gained 10.7 per cent today, closing at $0.62.

Oil and gas developer, Oil Search (ASX:OSH) announced its net profit rose 13 per cent to US$341 million in 2018, when compared to the prior year. The result came despite lower production on the back of the PNG Highlands earthquake in February 2018. OSH expects 2019 full year production guidance to be in a range of 28 – 31.5 mmboe.

Collection House (ASX:CLH) has reached a binding agreement to acquire the entire Purchase Debt Ledger (PDL) and other selected assets (including plant & equipment, intellectual property and the Sydney lease) from ACM Group for $40.3 million, with settlement expected by the end of March. The new business is tipped to contribute $5.5 million to EBIT in FY20.

Crown Resorts (ASX:CWN) and its joint venture partner, Schiavello Group had their planning extension denied, by the Victorian Government, for the proposed One Queensbridge project has been rejected

Best and worst performers of the day

The best performing sector was S&P/ASX Consumer Staples adding 1.2 per cent while the worst performing sector was S&P/ASX Utilities, shedding 0.7 per cent.

The best performing stock in the S&P/ASX 200 was, Bellamy's Australia (ASX:BAL), rising 12 per cent to close at $9.89. Shares in Bingo Industries (ASX:BIN) and Fortescue Metals Group (ASX:FMG) followed higher. It follows Fortescue (ASX:FMG) issuing better than expected results to the market with report season wrapping up last week.

The worst performing stock in the S&P/ASX 200 was Evolution Mining (ASX:EVN), dropping 5.6 per cent to close at $3.40. Shares in Lynas Corporation (ASX LYC)and St Barbara (ASX:SBM) followed lower.

Asian markets

Japan’s Nikkei has added 1.2 per cent, Hong Kong’s Hang Seng has added 1.2 per cent and the Shanghai Composite has gained 2.6 per cent.

Commodities and the dollar

Gold is trading at $US1,296 an ounce.
Iron ore price rose 3.1 per cent to US$87.92
Iron ore futures are pointing to a rise of 1.9 per cent.
Light crude is $1.42 lower at US$55.80 barrel.
One Australian dollar is buying 70.92 US cents.