AU Morning Wrap: ASX Falls; A2 Plunges 10%
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• US stocks finish lower last week, deepening August slump
• ASX falls; Iress shares sink; Premier soars 10%
• Stocks to watch: Iress, a2 Milk, Premier Investments
- Moomoo News AU
• US stocks finish lower last week, deepening August slump
• ASX falls; Iress shares sink; Premier soars 10%
• Stocks to watch: Iress, a2 Milk, Premier Investments
- Moomoo News AU
Wall Street Summary
Major U.S. stock indexes shed more than 2% this week, deepening their August slump, while Treasury yields touched their highest levels in years.
U.S. government bond yields on Friday fell back from Thursday's multiyear highs, but remained lofty enough to make investors think twice about betting on stocks to maintain this year's surprising rally.
The $Nasdaq Composite Index(.IXIC.US$, packed with rate-sensitive technology stocks, fell 0.2% on Friday. The $Dow Jones Industrial Average(.DJI.US$ rose about 26 points, less than 0.1%, while the $S&P 500 Index(.SPX.US$ declined less than 0.1%. Every segment of the S&P 500 ended the week lower.
AU Market Watch
The Australian sharemarket fell 0.2 per cent, or 11.9 points to 7137.3 at the opening bell, amid a busy morning of company results.
The information technology sector was the worst performer, led by sharp loss in Iress. Its shares plunged 19 per cent after it suspended its interim dividend following the completion of its plan to sell its managed funds administration business.
Infant formula group The $The a2 Milk Co Ltd(A2M.AU$ tumbled 10 per cent after it warned that its key China market this year will be more challenging with a further double-digit decline in value expected due to fewer newborns.
Plumbing supplies group $Reliance Worldwide Corp Ltd(RWC.AU$ sank 6.9 per cent after it said that a fall-off in new housing starts in Australia in the June half put its Australian operations under pressure.
Insurance giant $Insurance Australia Group Ltd(IAG.AU$ dropped 1.4 per cent even as it flagged even more premium rises are to come, after reporting a jump in profits.
$Premier Investments Ltd(PMV.AU$ surged 10 per cent following an announcement that chief executive Richard Murray will step down after almost two years at the helm.
Stocks to Watch
$Westpac Banking Corp(WBC.AU$: Westpac Banking Corp, Australia's third-largest lender, on Monday posted a quarterly cash profit of A$1.8 billion ($1.15 billion), as increased competition for home lending squeezed margins.
Australia's major banks have all flagged stiff competition in the mortgage space, along with higher expenses as inflationary pressures weigh.
$NIB Holdings Ltd(NHF.AU$: Health insurer NIB has lifted underlying operating profit 11 per cent to $263.2 million and announced a final dividend of 15¢ per share in the 2023 financial year.
The final dividend is up nearly 40 per cent, from the 11¢ in the 2022 financial year, and takes the distribution for the full year to 28¢.
$Charter Hall Group(CHC.AU$: Property fund manager Charter Hall expects to deliver a 6 per cent increase in its distributions in the coming year, confident it can weather a choppy commercial property market and the impact of rising rates.
The fund manager reported operating earnings of $441.2 million for fiscal 2023, equivalent to 93.3¢ per security, down from 115.5¢ the previous year.
Its statutory profit after tax was $196.1 million – a figure which reflects changes in portfolio values – down 78.5 per cent on the $911.1 it booked the previous year. Full-year distributions totalled distributions of 42.5¢.
$IRESS Ltd(IRE.AU$: Financial software and data firm Iress will sell its managed funds administration business to US software giant SS&C Technology for $52 million.
Iress said it will use the proceeds of the sale to pay down its debt and also plans to divest its platforms business to focus on its core operations. "As outlined to the market in April, we are committed to reducing costs, driving growth in our core Australian businesses, and managing our portfolio of non-strategic assets for value and the releases of capital," chief executive Marcus Price said.
The company also suspended its interim dividend while it completes its transformation plan. For the first half of 2023, Iress reported EBITDA of $29.4 million, down 55 per cent on the corresponding period, while revenue increased 2 per cent to $315.3 million.
The company reported a net loss of $139.8 million. For the second half of calendar 2023, Iress expects revenue growth will be softer and underlying EBITDA will be broadly flat, due to cost headwinds, reduced market trading volumes and broader macro uncertainties.
Listing: None
Source: Dow Jones Newswires, AFR
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