Jobless rate at 4.2%, Part-time jobs surge: ASX up 0.7% at noon

Market Reports

by Melissa Darmawan

A mixed jobs report on a busy day of earnings has seen the Aussie market lift to a 4-week high, continuing from its buoyant session yesterday. Investors focused on earnings after reading dovish Federal Reserve meeting minutes which pared losses on Wall St before jitters emerged on the lack of clarity around Russia’s comment on troops pulling back from the Ukraine border.

CSL lifts healthcare sector as #1

CSL (ASX:CSL) shares soared 4.9 per cent to $276.63 after several broker upgrades pushing the healthcare sector as the best performing sector.

Credit Suisse noted that the blood collecting giant’s profit came in 18 per cent ahead of consensus forecasts. The broker cited that Behring’s improved cost management and a stronger performance in the Sequius division which makes flu vaccines, helped buoy the outcome. While sales for Behring were impacted by a 15 per cent fall in volume, this was offset by a strong performance in other key products from Idelvion, Kcentra, and Haegarda.

In the losers corner, consumer discretionary is the worst performer by 2.5 per cent, weighed down by Wesfarmers (ASX:WES). The company posted a 12.7 per cent fall in its interim profit to $1.2 billion and trimmed its dividend by 9 per cent after pandemic related challenges continue to weigh. Losses in the share price have accelerated by 6.4 per cent to $51.39.

Tech shares weigh, Telstra drags sector lower

Technology sector is also a laggard as the second worst performer by 2.2 per cent. A couple of drags to mention are Block (ASX:SQ1) down 5.4 per cent at $150.67 and Codan (ASX:CDA) down 5.2 per cent at $8.39.

Communication services and utilities are the others in the red with the rest of the sectors trading higher. Telstra‘s (ASX:TLS) first half earnings haven taken a hit, blaming one-off reduction payments from the national broadband network. Shares are trading 3 per cent lower at $3.95.

Part time employment surges, jobless rate steady

As for the jobs report, the mixed results saw the jobless rate steady at 4.2 per cent with the participation rate edging higher to 66.2 per cent in January from the month before as per the Australian Bureau of Statistics. This sent Australian bonds rallying, while the Aussie dollar edged lower from 72 cents this morning to 71.98 US cents.

There were 12,900 new jobs added to the economy, pulling back from the 64,800 new jobs in December. However the interesting point of the report was that part-time employment increased by 30,000 people from 23,300 people in December. Hours worked fell 8.8 per cent in January amid Summer holidays and the Omicron wave which ripped through the nation that saw millions of Aussies in isolation leading to staff shortages.

After a week of commentary from the Reserve Bank, yesterday deputy governor Guy Debelle said that an interest rate rise in the next 12 months is possible, but not inevitable. However, economists think otherwise with rate hikes as soon as June are expected. The central bank believes that the uptick in inflation would abate and was prepared to be patient to be sure.

Across the major players leading in their respective sub-groups, BHP (ASX:BHP) is up 2.5 per cent at $48.49, National Australia Bank (ASX:NAB) is up 0.9 per cent at $30.90, Woodside Petroleum (ASX:WPL) is up 2.9 per cent at $27.40.

SPI futures - rise

Meanwhile, Asian markets are mixed, China market is in the green while Japan’s Nikkei and Hong Kong Hang Seng are having a slow start amid US futures pointing to a fall.

At noon, the S&P/ASX 200 is 0.7 per cent or 47.4 points higher at 7,332.

The SPI futures are pointing to a rise of 31 points.

Company news

Woodside Petroleum (ASX:WPL) more than doubled annual profit and hiked its dividend, thanks to buoyant oil and LNG prices. Its pending $40 billion merger with BHP Petroleum is on track to boost the producer into a global giant this year. Shares are on the move, up 2.9 per cent at $27.41.

Shares in Whitehaven Coal (ASX:WHC) are trading 1.1 per cent lower after the miner unveiled a buy back up to $400 million, after surging thermal coal prices helped the company achieve a record half-year result. The share price is sitting at $3.04.

Wesfarmers (ASX:WES) has posted a 12.7 per cent fall in its interim profit to $1.2 billion and trimmed its dividend by 9 per cent after pandemic related challenges continue to weigh. Shares have taken a dive, down 5.8 per cent at $51.72.

Meanwhile, embattled gaming group Crown Resorts’ (ASX:CWN) losses have accelerated to $196.3 million reflecting pandemic related challenges and a class action. However the gaming operator did accept a $8.9 billion takeover bid from American private equity firm Blackstone this week. Shares are trading 0.1 per cent lower at $12.55.

Sequoia Financial Group (ASX:SFG) has posted a 51 per cent surge in revenue to $79.1 million, a 57 per cent increase in net profit after tax to $2.6 million during the first half of the financial year.

Best and worst performers

The best-performing sector is healthcare, up 2.8 per cent. The worst-performing sector is consumer discretionary, down 2.3 per cent.

The best-performing stock in the S&P/ASX 200 is IPH (ASX:IPH), trading 6.7 per cent higher at $8.82. It is followed by shares in Sims (ASX:SGM) and Tabcorp Holdings (ASX:TAH).

The worst-performing stock in the S&P/ASX 200 is Lifestyle Communities (ASX:LIC), trading 6.8 per cent lower at $17.20. It is followed by shares in Wesfarmers (ASX:WES) and Pro Medicus (ASX:PME).

Commodities and the dollar

Gold is trading at US$1871.30 an ounce.
Iron ore is 3.0 per cent higher at US$140.30 a ton.
Iron ore futures are pointing to a fall of 1.1 per cent.
One Australian dollar is buying 71.98 US cents.

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