Lynas (ASX:LYC) NPAT up over 900%: Aus market down 1.8% over week

Market Reports

by Katrina Bullock

Aussie shares dropped in early trade and tracked sideways for most of the afternoon to end 2.4 per cent lower. The Information Technology sector led the losses today, with none of the sectors managing to advance.

The S&P/ASX200 index

At the closing bell the S&P/ASX 200 index closed 161 points lower to finish at 6,673.

Over the week, the market has lost 121 points or 1.8 per cent.

Futures market

Dow futures are suggesting a fall of 129 points.
S&P 500 futures are eyeing a dip of 14 points.
The Nasdaq futures are eyeing a fall of 98 points.
And the ASX200 futures are eyeing a 172 point fall on Monday morning.

Economic news

Today the Australian Bureau of Statistics published data on business conditions and sentiment for February. The survey data shows that 41 per cent of businesses were significantly impacted by Covid-19 restrictions during the month and that their cash on hand may not cover more than three months of operations.

The Reserve Bank of Australia also released private sector credit data for the month of January today. Private sector credit rose 0.2 per cent month on month and was up 1.7 per cent year on year.

Broker moves

Credit Suisse rates Qantas Airways (ASX:QAN) as an underperform with a price target of $3.90. Qantas's 2021 first-half result outpaced consensus by 7 per cent. But the broker notes that the domestic recovery was delayed 3 months due to state border closures and that fleet renewal demands and tougher domestic competition continue to weigh on the airline. Shares in Qantas Airways (ASX:QAN) are trading almost 2 per cent lower at $5.00.

Company news

Highway healthy meal provider, Oliver’s Real Food (ASX:OLI) has been forced to suspend trading today. The ASX forced the suspension saying its financial condition is inadequate to quote its securities. This comes on the back of the company reporting a $1.8 million loss for the half. Shares in Oliver’s Real Food (ASX:OLI) are trading 6.4 per cent lower at $0.06.

Shares in Lynas Rare Earths (ASX:LYC) jumped almost 6 per cent today after the company released its financial results for the half year. Net profit was up more than 9 fold compared to the prior corresponding period and rose to $40.6 million. Revenue rose 12 per cent year on year to $202.5 million, bolstered by record sales in the December quarter. EBITDA jumped 82 per cent to $80.6 million over the year. In light of the strong results, the Lynas Board has resolved to repay the Australian Jobkeeper subsidy and the Malaysian wage subsidy received during the first half. The bump in share price also follows an executive order from US President Joe Biden yesterday requiring federal agencies to conduct 100-day reviews of critical supply chains - many of which use rare earths as an input. Great news for Lynas which is the only major producer of separated rare earth materials outside of China. Shares in Lynas Rare Earths (ASX:LYC) rose 5.7 per cent higher to $5.98 today.

Lithium chemicals producer Orocobre (ASX:ORE) has suffered a net loss of US$29.1 million for the first half.

Litigation funder Omni Bridgeway (ASX:OBL) reported a $153.3 million loss in the first half, forcing it to take its interim dividend off the table.

COG Financial Services (ASX:COG) has published its financials for the half year to 31 December 2020. Underlying NPATA rose 140 per cent during the half to $10.1 million.

Buy now, pay later player Sezzle (ASX:SZL) has seen its net loss soar to $US31.9 million for the year ended 31 December 2020.

Wall Street

Wrapped up our four trading days this week lower: The Dow Jones fell 0.3 per cent, the S&P 500 lost 2.02 per cent and the tech heavy Nasdaq lost 5.8 per cent.

Best and worst performers of the day

All the sectors closed in the red. The sector with the fewest losses was Industrials, shedding 1.01 per cent, while the worst-performing sector was Information Technology, shedding 5.3 per cent.

The best-performing stock in the S&P/ASX 200 was AMP (ASX:AMP), rising 7.5 per cent to close at $1.50. Shares in Silver Lake Resources (ASX:SLR) and Lynas Rare Earths (ASX:LYC) followed.

The worst-performing stock in the S&P/ASX 200 was Orica (ASX:ORI), dropping 18.1 per cent to close at $12.56. Shares in Service Stream (ASX:SSM) and Afterpay (ASX:APT) followed.

Asian markets

Lower. Japan’s Nikkei has lost 3.2 per cent, Hong Kong’s Hang Seng has lost 2.4 per cent, and the Shanghai Composite has lost 1.8 per cent.

Commodities and the dollar

Gold is trading at US$1,768 an ounce.
Iron ore rose 0.9 per cent to US$174.24. Its futures are pointing to a rise of 1.9 per cent.
Light crude is 72 cents down to US$58.33 a barrel.
One Australian dollar is buying 78.32 US cents.