ASX News LIVE | ASX to Rise; S&P 500 hits 32nd Record High this Year

The ASX 200 closed up +0.28% to 7,739.9 in a relatively subdued and rangebound day that saw seven of the elven sectors gain today.

Technology was today’s biggest beneficiary, with Wisetech gaining nearly 2%, while Xero was up +1.43%.

Of the tech midcaps, Nuix was a standout, gaining nearly +7% in the session today.

Mining also had a stronger day, as Iron ore futures in Singapore climbed to $US110.70 per tonne, boosting major miners, with broad gains seen by the mega caps.

BHP up +1%, Fortescue gained +1.5%, and Rio Tinto was up +1.3%.

In other news, May retail trade data exceeded forecasts, increasing by 0.6% compared to an expected 0.3%. The ABS said the higher figure was likely due to heavy discounting by retailers.

Despite the overall market gains, Liontown Resources was a major underperformer today, falling by -5.5%. Chalice Mining was the wider ASX’s worst stock today, down nearly -18%, while Cettire bounced off recent falls, gaining +12.35%.

The ACCC has given the green light for the Australian Banking Association (ABA) to give $50 million to struggling cash transport business Armaguard.

Armaguard is now Australia’s last remaining security cash transport, but even with a monopoly, the company has struggled to stay afloat.

But major banks and retailers who handle large sums of cash still need its services, so in a deal penned last week they have agreed to support the company in exchange for future guarantees it will not abuse its monopoly position.

The deal will mean, ANZ, NAB, Westpac, Commonwealth Bank, Coles, Woolworths, Wesfarmers, and Australia Post will contribute to the $50 million fund.

The ACCC commented today saying:

“We consider that the financial assistance to Armaguard increases the likelihood of a more sustainable supply of wholesale cash distribution services as well as access to cash by businesses and members of the public across Australia,” acting ACCC boss Mick Keogh said.

The latest retail data for May was just released this morning, showing a slight uptick, according to the ABS.

Retail sales rose by +0.6% in May, up from a 0.1% gain in April and a 0.4% in March.

This was above the consensus expectations of a 0.3% gain for this month, which the ABS said was due to heavier discounts by retailers, saying:

“Retail turnover was boosted this month by watchful shoppers taking advantage of early end-of-financial year promotions and sales events,” said the ABS’s Robert Ewing.

 

“Retail businesses continue to rely on discounting and sales events to stimulate discretionary spending, following restrained spending in recent months.”

Despite the increased retail turnover, underlying spending was relatively flat for the month, meaning its still a long road ahead for major retailers in this economic environment.

From here, Australia’s economy is on a tough road. We’ve written about it in our latest report on what stocks thrive when things are looking tough.

Read more on Australia’s decade of decimation here.

The ASX 200 is up by +0.31% around midday, at 7,742.2, as the mining and energy sector carries the markets today.

Of the larger mining caps, BHP +0.90%, Fortescue is up +1.3%, South32 gained nearly 3%.

While in energy stocks, ASX coal producers continue to gain as the Grosvenor coal mine fire continues to burn in Queensland.

Whitehaven Coal +1.28%, Yancoal +0.43%, while mega cap Woodside Energy gained +0.65%.

In economic news, the market shrugged off the latest May retail trade data, which showed a 0.6% improvement above the consensus 0.3%.

In company news, lithium hopeful Sayona Mining has appointed former Adani country head and BHP veteran Lucas Dow as CEO today.

While Booktopia has been placed in voluntary administration after failing to secure funding.

Online book retailer Booktopia [ASX:BKG] has been placed in voluntary administration, ending the ongoing saga since mid-June when the company halted its shares and began searching for more funding.

McGrathNicol has been appointed to manage the administration and assessment of its business for the next steps.

The first meeting with creditors will take place on Monday, 15 July.

The company share’s were last traded at 4.5 cents after falling 70% in the past 12 months.

Infrastructure company APA Group’s [ASX:APA] stock price is down by -0.5% to $7.91 this morning, following its announcement of an anticipated $145 million non-cash impairment for its Moomba Sydney Ethane pipeline (MSEP).

The MSEP is a single-user pipeline, used to transport ethane to plastics manufacturer Qenos, which recently entered into voluntary administration and announced that it does not expect to restart its manufacturing facility.

Qenos was the only customer with demand for ethane to be transported along the MSEP, and so the company will now look at alternative uses, such as converting for natural gas. However, they said it would take some time to assess the options.

This projected impairment is expected to write off the pipeline’s book value, which is approximately 1% of APA’s market cap.

Good morning. Charlie here,

The ASX 200 is set to rise as Australian shares follow Wall Street higher. Comments from Fed chairman Jerome Powell have eased bond yields and sent US equities higher as he said the ‘disinflationary path is intact’ as the Central Bank had made ‘quite a bit of progress’ in reducing inflation.

Traders read this as ‘expect cuts this year’, pushing tech stocks higher. 6 of the Magnificent 7 rose to catch up with Nvidia, which fell -1.3% overnight.

The S&P 500 closed above 5,500 for the first time ever as it reached its 32nd record high this year.

As J Powell’s comments were instrumental in easing bond yields, which had jumped 18bps in recent sessions and gave stocks room to run, let’s look at some other comments that weren’t as well publicised from the meeting. Notably, this comment:

‘Because the US economy is strong, we have the time to make sure we get this right.’

This was said as the latest job figures for the US showed job openings and hires unexpectedly ticked higher in May, rising to 8.1 million, up from 7.92 million.

The change wasn’t huge, but it was a movement in the opposite direction than many had expected, as economists look for signs of weakness in the labour market.

This second comment from Powell betrays the cautious approach the Fed is likely to take from here, meaning cuts are unlikely to come anytime soon.

On the ASX, we’ve seen commodity prices ease slightly overnight, with oil retreating from its two-month high, so expect some retracement from booming energy stocks from yesterday, while tech could recover from its prior selloff.