Jobless rate falls to 5.5%: ASX tracking 0.9% higher at noon

Market Reports

by Melissa Darmawan

Text-only (non-video) report.

The Australian sharemarket opened higher with a broad-based advance led by Information Technology and Property sectors making a U-turn from yesterday’s decline. Bucking the trend are the Materials and Energy sectors with the likes of BHP (ASX:BHP) dropped 2 per cent, Rio Tinto (ASX:RIO) down 1.2 per cent and Fortescue Metals (ASX:FMG) tripped 0.7 per cent with its futures pointing to a further fall. On the banking front, CBA (ASX:CBA) has outshined its peers up 2.3 per cent followed by ANZ (ASX:ANZ), Westpac (ASX:WBC) and NAB (ASX:NAB) all notched higher by over 1 per cent. The best performing stock is EML Payments (ASX:EML) pivoted from yesterday’s plunge, up 13.4 per cent while the worst performer is Nuix (ASX:NXL) as they reverse their gains from Tuesday’s high following their investor presentation. Oil Search (ASX:OSH) down 2.8 per cent and Woodside Petroleum (ASX:WPL) skid 1.2 per cent as oil prices fell by 3 per cent. To the gold players who've lost their shine as Resolute Mining (ASX:RSG) tumbled 6.9 per cent and Evolution Mining (ASX:EVN) down 0.4 per cent. At noon, the S&P/ASX 200 is 0.98 per cent or 67.90 points higher at 6999.60. The SPI futures are pointing to a rise of 53 points.

Local economic news

Australia’s jobless rate fell from 5.6 per cent to 5.5 per cent in April continuing the momentum in the labour force recovery. The participation rate fell from 66 per cent from 66.3 to around its pre-pandemic levels.

Company news

Agricultural company Nufarm (ASX:NUF) reports a 20 per cent rise in revenue in their first half for FY21 with their EBITDA jumped 118 per cent compared to same period a year ago.

Australia’s national flag carrier Qantas (ASX:QAN) has provided a full-year outlook suggesting that the company is projected to record a loss of over $2 billion for FY21 due to pandemic restrictions.

Gold player Evolution Mining (ASX:EVN) has finalised the transaction for the takeover of Battle North Gold for $366 million, following the successful completion of a scheme of arrangement.

Broker moves

Macquarie rates Afterpay (ASX:APT) as an outperform with a target price of $120. The upgrade from neutral follows a buy now pay later survey in the US where the broker observed limited brand loyalty among its peers. The results estimated that 70 per cent of users would prefer to sign up with a different BNPL rather than switch stores. The broker believes this increases the importance of having a large two-sided network of merchants/users of which Afterpay ranks the highest among its peers. The survey results noted the terms of brand perception with PayPal ranked first followed by Affirm then Afterpay. The broker upgrades its rating from a neutral and retains its target price at $120. Shares in Afterpay (ASX:APT) are trading 5.29 per cent higher at $91.04.

Best and worst performers

The best-performing sector is Information Technology, up 3.70 per cent. The worst-performing sector is Materials, down 0.86 per cent.

The best-performing stock in the S&P/ASX 200 is EML Payments (ASX:EML), trading 13.21 per cent higher at $3.17 followed by shares in Afterpay (ASX:APT) and Altium (ASX:ALU).

The worst-performing stock in the S&P/ASX 200 is Nuix (ASX:NXL) trading 11.20 per cent lower at $3.25 followed by shares in Flight Centre Travel (ASX:FLT) and Iluka Resources (ASX:ILU).

Commodities and the dollar

Gold is trading at US$1872.39 an ounce.
Iron ore is 3.70 per cent lower at US$216.16 a ton.
Iron ore futures are pointing to a fall of 6.90 per cent.
One Australian dollar is buying 77.36 US cents.

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