AU Morning Wrap: ASX sinks 2%, led lower by tech

Wall Street Summary
US stocks tanked after Fed Chair Jerome Powell blew away any lingering hopes of a "pivot" in the war on inflation. Powell told a gathering of central bankers the US's commitment to crushing inflation by raising rates was "unconditional", even it meant pain for the economy – and by extension, stock prices.

The $S&P 500 Index(.SPX.US)$ dived 141 points or 3.37 per cent. Just five stocks resisted the selling. The $Dow Jones Industrial Average(.DJI.US)$ shed 1,008 points or 3.03 per cent. The $Nasdaq Composite Index(.IXIC.US)$ gave up 498 points or 3.94 per cent.

AU Market Watch
Futures trading suggests the S&P/ASX 200 will open 104 points or 1.48 per cent lower this morning. Brutal though that sounds, it is a scratch compared to damage on Wall Street on Friday.

Australian shares opened lower this morning. The $S&P/ASX 200(.XJO.AU)$ lost 1.86 per cent to 6971.7 as of 10:14 am.

Stocks to Watch
$Fortescue Ltd(FMG.AU)$: Fortescue Metals Group declared a fully franked final dividend of $1.21 a share, to be paid September 29, after reporting a full-year net profit of $US6.2 billion.

$Mineral Resources Ltd(MIN.AU)$: Mineral Resources has reported underlying EBITDA of $1 billion for the year ended June 30, down 46 per cent on the prior corresponding period (pcp). Underlying earnings after tax were $400 million. Statutory net profit after tax was $351 million, down 72 per cent on the pcp, and revenue fell 8 per cent to $2.4 billion. Operating cash flow was $344 million.

$Charter Hall Retail REIT(CQR.AU)$: Charter Hall Retail REIT upgraded earnings for 2022-23 following some sizeable transactions, including this morning's $120 million Z Energy deal in New Zealand. The REIT now expects 2023 earnings per unit of no less than 28.7¢, up from 28.6¢. Distribution guidance was upgraded to a floor of 25.8¢ up from 25.7¢.

$Aussie Broadband Ltd(ABB.AU)$: Aussie Broadband forecast financial 2023 revenue in the range of $800 million to $840 million, and an EBITDA margin of 10 per cent to 10.5 per cent. The EBITDA margin improves from 7.2 per cent and excludes integration costs from the Over the Wire acquisition. Over the first eight weeks of 2022-23, Aussie Broadband gross sales less churn were 15,332.

$The a2 Milk Co Ltd(A2M.AU)$: A2 Milk has announced it intends to undertake a capital return of up to $NZ150 million through an on-market share buyback which is expected to commence towards the end of September. The company’s revenue for FY22 increased 19.8 per cent to $NZ1.4 billion. EBITDA rose 59 per cent to $NZ196.2 million.

Ex-dividend: $Ansell Ltd(ANN.AU)$, $Challenger Ltd(CGF.AU)$, $Coronado Global Resources Inc(CRN.AU)$, $Gale Pacific Ltd(GAP.AU)$, $Hansen Technologies Ltd(HSN.AU)$, $Ingenia Communities Group(INA.AU)$, $Pengana Capital Group Ltd(PCG.AU)$, $Pinnacle Investment Management Group Ltd(PNI.AU)$, $SIV Capital Ltd(SIV.AU)$, $VGI ASIAN FPO(VG8.AU)$, $Worley Ltd(WOR.AU)$

Commodities
• Iron ore futures rose 0.2% to US$105.4 a tonne, up 0.6% last week. "Chinese traders saw their stocks of the 5 major steel products continue declining during August 19-25, but the total volume fell at a slower pace of -1.7% week-on-week, as against the -2.8% week-on-week decline seen in the prior week," Mysteel reported.

• Oil prices briefly dipped on weaker-than-expected US economic data and the Fed's commitment to hiking into a possible recession. Still, Brent crude managed to rally back up to the psychological US$100 level.

• Gold tumbled thanks to a more hawkish-than-expected Powell speech which pushed Treasury yields higher.

Source: Dow Jones Newswires, AFR