Borrowing misses expectations: Aus shares 0.6% lower at noon, but 1% off 11.5-year highs

Market Reports

by Jessica Amir

The Australian share market is trading lower for the second day in a row, but it’s still trading in a 1 per cent range of the new 11.5-year highs the market hit last week (24 and 26 April 2019).

Most of the sectors are the red and about four sectors have lost 1 per cent or more at noon. Meantime The S&P 500 hit a new all-time high after rising 0.11 per cent at 2,943 on the back of about 78 per cent of company’s reporting results that beat expectations. While we also saw the tech heavy Nasdaq hit a new all-time high after rising 0.2 per cent to 8,162.

The S&P/ASX 200 index is 38 points or 0.6 per cent lower at 6,322. On the futures market the SPI is 40 points lower.

It seems local traders and investors are perhaps taking profits and also absorbing the news that private sector credit grew 3.9 per cent over the year to the close of March, missing expectations of a 4.3 per cent rise, after it grew 5 per cent over the same time last year.

Company news

Owner and operator of retail brands including Rebel Sport, Supercheap Auto, BCF, Super Retail Group (ASX:SUL) has reported a 4.4 per cent growth in sales over the 43 weeks to 27 April 2019, compared to the prior corresponding period. The largest sales growth came from Macpac, which saw total sales rise 17.8 per cent in the period. The company’s MD and CEO Anthony Heraghty presented at the Macquarie Bank Australia Conference, after having started in the CEO hot seat on 20 February 2019. He confirmed his focus areas for his first 100 days, which included simplifying the company’s operating model to remove duplication. Super Retail Group (ASX:SUL) shares are trading 2.92 per cent higher at $8.63 at noon. Year-to-date its shares are trading 25 per cent higher.

Domain Holdings Australia (ASX:DHG) also had its CEO and MD present at Macquarie Australia’s Conference. Jason Pellegrino highlighted home loans, insurance and utilities connections as being ‘key development initiatives’ for business growth and competitive positioning. He says, that’s because the average home loan is refinanced every 4 years, and that yields about $5,000 for the business. Whereas, the annual transaction frequency for insurance and utilities, has yields of around $200 and $150 respectively. If you compare that to the $800 million property listing market, where the average property is sold once in every 10 years, the available yield for the company ranges from $180 to more than $2,000. Shares in Domain Holdings Australia (ASX:DHG) are trading 6.2 per cent lower at $2.74 at noon. Year-to-date its shares are trading 22 per cent higher. Over the year its shares are 11 per cent lower.

IPOs

Pengana Private Equity Trust (ASX:PE1) started trading today. The listed investment trust investing in global private equity, floated with an issue price of $1.25, opened at $1.24 and its trading at $1.24.

Best and worst performers

The best performing sector is S&P/ASX 200 Health Care, adding 0.04 per cent, while the worst performing sector is &P/ASX 200 Energy shedding 1.4 per cent.

The best performing stock in the S&P/ASX 200 is Aveo Group (ASX:AOG), rising 5.7 per cent to $2.04, followed by shares in Super Retail Group Limited (ASX:SUL) and Afterpay Touch Group Limited (ASX:APT).

The worst performing stock in the S&P/ASX 200 is Domain Holdings Australia (ASX:DHG), dropping 6.2 per cent to $2.74, followed by shares in Viva Energy Group Limited (ASX:VEA) and OohMedia (ASX:OML).

Asian markets

Japan’s Nikkei is not trading due to a national holiday, Hong Kong’s Hang Seng has lost 0.3 per cent and the Shanghai Composite has gained 0.2 per cent.

Commodities and the dollar

Gold is trading at US$1,282 an ounce.
Iron ore price rose 0.5 per cent US$94.05
Iron ore futures are pointing to a rise of 0.9 per cent.
One Australian dollar is buying 70.42 US cents.