Green shoots on potential trade deal: Aus shares 0.4% higher at noon

Market Reports

by Jessica Amir

Green shoots for the US and Asian markets as Trump says China sincerely wants a trade deal.

Overnight in the US, Wall Street made somewhat of a rebound, with the Nasdaq rising 1.3 per cent and the S&P 500 rising 1.1 per cent, after respectively losing 3 per cent and 2.6 per cent on their prior session (on Friday).

Most local sectors are trading higher except, REITs, Energy and Staples which are lower.  Gold briefly hit a 6-year high on heightened global trade and economic risks, but pared these gains in later trading. The oil price eased on the potential for officials from the US and Iran to meet on the 2015 Nuclear deal. The Reserve Bank Deputy Governor Guy Debelle is speaking at the Economic Society of Australia (ACT) lunch in Canberra at 12pm AEST.

The S&P/ASX 200 index is 0.4 per cent or 23 points up at 6,463. On the futures market the SPI is 0.4 per cent or 23 points higher.

Broker moves

Citi has analysed Wesfarmers (ASX:WES) results, maintaining its sell rating of the stock with a 12 month price target of $33.80. Wesfarmers full year results were announced this morning with solid earnings, supported by Bunnings, amid a challenging market. WES delivered continuing operating EBIT growth of 2.3 per cent YOY growth and in-line with Citi’s expectations (of $2.8 billion result). Its final dividend of 78cps came in 4 per cent below Citi’s expectations (81cps). It's trading at $38.72

Company news

A leader in infection control, Nanosonics (ASX:NAN), reported its full year result to 30 June 2019 with record sales of $84.3 million, that’s a rise of 39 per cent on the same time last year. Globally, the business has now installed 20,930 units, and that has risen 18 per cent (on pcp). NAN has expanded its distribution agreement with GE covering Nordic countries, Iberia plus additional distributor partners in Israel, Switzerland and Kuwait. Profit after income tax grew 137 per cent higher to $13.6 million, while its earnings before interest and tax saw a massive 260 per cent surge to $15.5 million. Shares in Nanosonics (ASX:NAN) are trading 27.1 per cent higher at $6.23 at noon.

Rural Funds (ASX:RFF) released an unbiased report from EY following the short seller, Bonitas Research reported released on 6 August, which caused RFF’s shares to drop 42 per cent on that day, as Bonitas alleged the value of RFF’s business was zero. EY’s independent investigation found ‘the assertions contained within the document are not substantiated’. It follows that RFF also rejected the claims made and RFF’s MD David Bryant rebutted the report in a webinar - rejecting each of the claims made. Clayton Utz will commence legal action against Bonitas Research LLC for its deliberate and malicious publication of the document. And as promised, RFF delivered its financial results today as well. Results showed growth in net assets value per share, from $1.68 to $1.80 on an adjusted basis. Profit after tax grew $33.4 million from $29.895 million in the 12 month to 30 June 2019, compared to the same time last year. RFF shares have recovered from the bulk of the heavy fall on 6 August and today its shares are trading 3 per cent higher at $2.07 at noon.

IPOs

Software-as-a-service company, AppsVillage Australia (ASX:APV) started trading today. It issued shares at $0.20 and started trading on the ASX at $0.27 and is currently trading at $0.255.

Best and worst performers

The best-performing sector is S&P/ASX Info Tech, adding 2.3 per cent, while the worst performing sector is S&P/ASX Consumer Staples, shedding 0.3 per cent.

The best performing stock in the S&P/ASX 200 is Nanosonics Limited (ASX:NAN), rising 27.1 per cent to $6.23, followed by shares in Afterpay Touch Group Limited (ASX:APT) and Reliance Worldwide Corporation Limited (ASX:RWC).

The worst performing stock in the S&P/ASX 200 is Speedcast International Limited (ASX:SDA),dropping 24.9 per cent to $1.27, followed by shares in Inghams Group Limited (ASX:ING) and Northern Star Resources Ltd (ASX:NST).

Asian markets

Japan’s Nikkei has added 1.2 per cent, Hong Kong’s Hang Seng has slip 0.1 per cent and the Shanghai Composite has added 0.8per cent.

Commodities and the dollar

Gold is trading at US$1,529 an ounce
Iron ore price fell 3.3 per cent to US$84.91
Iron ore futures are pointing to a fall of 2.1 per cent.
One Australian dollar is buying 67.73 US cents.
 

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter with Prime7 and Win News.