The Australian share market opened higher and is now tracking 0.7 per cent higher at noon. The Real Estate Invest Trust sector is leading the charge. All of the sectors, except for Health Care are on the rise this morning.
S&P/ASX 200 index
The S&P/ASX 200 index is 36 points higher at 5,400. On the futures market the SPI is 36 points higher.
Local economic news
The Reserve Bank of Australia has released a statement on monetary policy this morning. It expects Australia’s GDP to contract over the first half, mostly in the June quarter and says we are likely to see a decline of around 10 per cent from peak to trough. It warned that there is expected to be a large increase in the unemployment rate – perhaps peaking at around 10 per cent. Total hours worked are likely to contract by around 20 per cent over the first half of 2020. It noted that following very sharp declines in March, equity prices have since recovered around half the losses, but remain volatile. It reaffirmed its commitment not to increase the cash rate target until progress is being made towards full employment and it is confident that inflation will be sustainably within the 2–3 per cent target band. It is interesting to note that the RBA’s projections assumed that most restrictions would be lifted by the end of the September quarter, aside from the limits on very large public gatherings. It also assumed that international border closures would continue until the end of the year.
Macquarie has upgraded Pushpay Holdings (ASX:PPH) to an outperform, with a 12 month price target of NZ$6.42. The broker suspects Pushpay’s guidance for the 2021 financial year to be conservative, considering the momentum in digital products. Shares in Pushpay Holdings (ASX:PPH) are trading 0.2 per cent lower at $6.03 at noon.
Media giant, News Corporation (ASX:NWS) has reported a net loss of around $1 billion for the third quarter, a far cry from the $23 million income we saw in the third quarter of 2019. The company has seen a 2 per cent decline in third quarter EBITDA compared to the prior year. EBITDA was $242 million compared to $247 million in 2019. Revenue for the quarter was down 8 per cent year on year to $2.27 billion. The loss is largely caused by the $1.1 billion impairment charges related to a write-down of goodwill and intangible assets at Foxtel and the reclassification of News America Marketing to assets held for sale. Shares in News Corp (ASX:NWS) are trading just over 3 per cent higher at $16.01 at noon.
Investment bank and financial services company, Macquarie Group (ASX:MQC) has slashed its final dividend in half after released analysis for the year ending 31 March 2020. The bank will issue a partially franked dividend of $1.80 per share, compared with last year's payout of $3.60 per share. The company reported an 8 per cent drop in net profit compared to the previous year, bringing the figure to $2,731 million. Return on equity was down 18 per cent year on year. Operating expenses were broadly in line with the previous year. Shares in Macquarie Group (ASX:MQC) are trading 3.8 per cent higher at $103.34 at noon.
Best and worst performers
The best-performing sector is Real Estate Investment Trusts, adding 2.3 per cent, while the worst performing sector is Health Care, shedding nearly 1 per cent.
The best performing stock in the S&P/ASX 200 is AP Eagers (ASX:APE), rising 8.3 per cent to $4.94, followed by shares in REA Group (ASX:REA) and Pilbara Minerals (ASX:PLS).
The worst performing stock in the S&P/ASX 200 is Iluka Resources (ASX:ILU),dropping 4.1 per cent to $7.28, followed by shares in Alumina (ASX:AWC) and Polynovo (ASX:PNV).
Japan’s Nikkei has is tracking 1.4 per cent higher, Hong Kong’s Hang Seng is nearly 1 per cent higher and the Shanghai Composite is trading 0.6 per cent higher.
Commodities and the dollar
Gold is trading at US$1,718 an ounce.
Iron ore price is flat at US$84.35.
Iron ore futures are pointing to a rise of 2.5 per cent.
One Australian dollar is buying 65.32 US cents.