ANZ suspends dividend as profit plunges: ASX poised to open higher

Market Reports

by Rachael Jones

The Australian share market looks set to open higher this morning. US markets higher mixed as President Donald Trump says he wants the Food and Drug Administration to move “as quickly as they can” to approve the antiviral drug remdesivir as a treatment for the coronavirus. Facebook shares rose as much as 10 per cent after the company reported its first-quarter results showing revenue up 18 per cent at $17.74 billion. They have 2.99 billion monthly users across its family of apps, compared to 2.89 billion in the previous quarter. The Australian dollar continues to rise against the US dollar and had an overnight peak of 65 cents.

Local economic news 

The Reserve Bank releases the Financial Aggregates publication today. APRA releases banking data also today. And the ABS releases the second of the inflation indicators on Thursday: International Trade Price indexes. The data covers measures of export and import prices.

Markets

Wall Street closed higher yesterday: The Dow Jones Industrial Average gained 2.2 per cent to close 24,634 the S&P 500 added 2.7 per cent to 2940 and the NASDAQ closed 3.6 per cent higher at 8915.

European markets closed higher: London’s FTSE added 2.6 per cent, Paris gained 2.2 per cent and Frankfurt closed 2.9 per cent higher.

Asian markets closed higher: Tokyo’s Nikkei was closed, Hong Kong’s Hang Seng added 0.3 per cent and China’s Shanghai Composite added 0.4 per cent.

Taking all of this into equation, the SPI futures are pointing to a 2.01 per cent gain.

Yesterday, the Australian share market closed 1.5 per cent higher at 5393.

Company news 

The ANZ (ASX:ANZ) today announced a Statutory Profit after tax for the Half Year ended 31 March 2020 of $1.55 billion, down 51 per cent on the prior comparable period. This decline was driven primarily by credit impairment charges of $1.674 billion that included increased credit reserves for COVID-19 impacts of $1.031 billion. The valuation of investments in Asian associates was impaired by $815 million, largely due to the impact COVID-19 is having in those markets. Return on Equity decreased to 4.7 per cent. ANZ’s Board also determined it will defer its decision on the 2020 Interim Dividend until there is greater clarity regarding the economic impact of COVID-19. Shares in ANZ (ASX:ANZ) closed 6.1 per cent higher at $16.66 yesterday.

Currencies

One Australian Dollar at 8:00 AM was buying 65.58 US cents, 52.60 Pence Sterling, 69.91 Yen and 60.31 Euro cents.

Commodities

Iron Ore has added 0.04 per cent to US$82.50
Iron Ore futures suggest a 0.5 per cent fall.
Gold has dropped $8.80 to US$1713 an ounce.
Silver has fallen $0.01 to US$15.32 an ounce.
Oil was up $2.72 to US$15.06 a barrel.