Live ASX News Today
ASX ends lower for 5th session on miners’ rout, posts worst weekly loss since January
Australian shares ended lower for the fifth straight session on Friday, paring opening gains, led by sell-off in material, tech and energy stocks. The slump in commodity prices coupled with concerns about economic growth dented market sentiment. The extension of lockdown in Sydney by a month following record rise in COVID-19 cases also kept investors sidelined. In the past 24 hours, New South Wales (NSW) reported 642 new local COVID-19 cases.
The ASX200 closed 3.70 points lower at 7,460.90. Earlier today, the index opened flat and gained as much as 0.6% to hit an intraday high of 7,512. Over the past five sessions, the index dropped 2.2% amid persistent fall in commodity prices, marking its worst weekly performance since January 2021.
The equity market witnessed mixed trading as seven of 11 sectoral indices ended higher. The utilities sector emerged as the best performer with 1.36% gain. It was followed by consumer staples, which gained 1.2%. Among others, A-REIT, consumer discretionary, telecom and health care ended higher with modest gain.
Meanwhile, material sector extended decline for the second day, falling 1% on drop in commodity price. The spot price of iron ore plunged 15% in overnight trade, amid a slump in demand for the steelmaking material. The concerns about rising coronavirus, tapering of Federal Reserve's stimulus, and tightening of property policy in China also dragged iron prices lower.
Some of the other worst performing sectors include energy, information technology, financial and industrial.
Among the individual stocks, e-commerce player Redbubble (ASX: RBL) emerged as biggest percentage gainer for the second day, surging 16% on robust earning. Some of the other top gainers were poultry producer Inghams Group (ASX:ING), winemaker Treasury Wine Estates (ASX:TWE) and e-retailer Kogan.com (ASX:KGN).
Meanwhile, hearing implant maker Cochlear (ASX: COH) topped the losers chart by falling over 7%. Some of the other worst performers were miner Lynas Rare Earths (ASX:LYC) and gold miner Pilbara Minerals (ASX:PLS).
Felix (ASX:FLX) launches new strategic module
Cloud-based enterprise Software as a Service (SaaS) company Felix Group Holdings Ltd (ASX:FLX) shared on Friday that it will be expanding its procurement management platform with the launch of a new, highly strategic Procurement Schedule module.
The Company elaborated in the announcement that the Procurement Schedule provides complete visibility and control over procurement programs and performance.
The release stated that Procurement Schedule built in close collaboration with one of country’s largest contractors and other industry leaders and is a tailored solution for organisations to connect critical project planning, scheduling and tracking data with their key sourcing processes. The module is now live across the first cornerstone customer, active across telecommunications, infrastructure, construction and natural resources.
FLX closed 5.128% lower at AU$0.205 per share today.
Data#3 (ASX:DTL) delivers a record full year result
Australia-based IT services provider Data#3 Limited (ASX:DTL) shared its results for the financial year ended 30 June 2021.
- The Company stated Revenue is up 20.3% to AU$1.96 billion, with public cloud up 36.2 % to AU$791.6 million.
- NPBT is up 8.4% to AU$36.9 million.
- NPAT is up 7.5% to AU$25.4 million.
- Basic EPS is up 7.5% to 16.51 cents per share.
- Total fully franked dividend up is7.9% to 15.0 cents per share.
- The Company also reported a strong balance sheet with no borrowings.
The stock DTL ended the session at AU$5.480 per share, up 12.295%.
Titomic (ASX:TTT) sells TKF1000 to research organisation TWI UK
Public company Titomic Limited (ASX:TTT) shared today that it has received a purchase order from UK-based TWI of approximately AU$2.28 million to supply a TKF1000 System which will be shipped in May 2022.
TWI is a research and technology organisation in the UK and this purchase is funded by the Aerospace Technology Institute. This will become the basis of TWI’s overarching Cold Spray Additive Manufacturing Project, due to be completed before the end of 2022.
The TKF1000 will allow TWI’s Industrial Members to join a portfolio of projects under the umbrella of the Cold Spray AM Project, as they develop and validate manufacturing opportunities while providing a unique competitive advantage to the UK aerospace industry.
The stock TTT was spotted trading 3.947% higher at AU$0.395 per share at 2:40 PM AEST.
Netwealth (ASX:NWL) delivers NPAT growth of 23.9%
Financial services firm Netwealth Group Limited (ASX:NWL) closed 8.005% higher at AU$15.380 per share today. The share rise can be attributed to the FY2021 financial result that the Company announced.
The Net profit after tax (NPAT) of the provider of investment management services has increased by 23.9% to AU$54.1 million for the year. The Company's total income has also grown by 16.9% to AU$144.9 million in the current financial year.
In view of the Company's good performance in FY21, the Group has declared a 9.5 cent fully franked final dividend. This has bought the total dividend for FY21 to 18.56 cents.
The announcement said that Netwealth is recognised as the fastest growing platform, with its market share of 4.6%, up 1.0%. Besides, for FY21, the Group has recorded a high EBITDA margin of 54.8%.
Furthermore, in the latest Plan for Life platform market update for March 2021, the Company recorded the most significant quarterly FUA net inflows of AU$2.3 billion, the highest net industry fund flows for the ninth consecutive quarter.
Airtasker (ASX:ART) records 38% revenue growth in the FY21
Australia’s leading online marketplace Airtasker Limited (ASX:ART) shared the FY21 results today, which stated robust growth in revenue growth of about 38%.
Key highlights of the FY 21 result:
- The FY21 results suggest revenue of $26.6 million which has exceeded the prospectus forecast of $24.5 million and up 38% year-on-year.
- Gross Marketplace Volume (GMV) of AU$153.1 million exceeded prospectus forecast of $143.7 million and up 35% year-on-year.
- UK marketplace accelerated with GMV up 232% year-on-year and 93% quarter-on-quarter.
- Underlying pro forma EBITDA of AU$0.0 million compared with AU$(4.0 million) in FY20.
- Positive operating cash flow of AU$5.5 million surpassed prospectus forecast of AU$0.1 million.
- Cash on hand of AU$45.9 million is ready to be invested into accelerating international expansion.
ART stock closed 1% up at AU$1.010 per share on the ASX today.
Pental (ASX:PTL) to acquire Hampers with Bite (HWB)
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Branded home and hygiene product developer Pental Limited (ASX:PTL) shared on Friday that it has struck a deal to buy Hampers with Bite Pty Ltd (HWB).
HWB is a Melbourne-based online hamper and gifting specialist.
Highlights of the acquisition:
- Founded in 2004, HWB reported sales revenue of approximately AU$24 million and EBITDA of approximately AU$5.1 million in FY21.
- The acquisition is likely to be immediately EPS accretive and is consistent with Pental’s stated strategy.
- Estimated combined Group FY21 pro-forma underlying EBITDA of AU$17.1 million from net sales revenue of AU$149 million.
- Pental has a strong balance sheet position to execute the Acquisition with AU$12.7 million in cash on hand and no debt.
- Total proposed Acquisition consideration is a maximum of AU$28.3 million.
- Completion of the Acquisition is likely to happen in mid-September 2021.
The stock PTL traded 4.545% higher at AU$0.460 per share at 12:30 PM AEST.
Iron ore dips to eight-month lows after hitting record highs in May
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Iron ore prices dipped to eight-month low levels on Thursday over concerns on rising coronavirus, tapering of Federal Reserve's stimulus, and tightening property policy in China.
- Iron Ore Fine China Import 63.5 percent grade last traded 9.84% down at US$142 per tonne on Friday at 10:23 AM AEST. The prices slumped nearly 10.41% on a YTD basis.
- Iron ore prices hit record-high levels, just three months ago on surging demand from the Chinese steel industries and a tight supply.
- However, the country's steel production is expected to fall in the second half of 2021, especially due to strict property policy affecting construction industry and the country's move to curb carbon emission.
- The metals market has also been weighted by the concerns that Fed may soon start curbing massive stimulus that helped drive prices, last year.
ASX ends lower for fourth session; what fueled sell-off in stock market?
Australian shares ended in red for the fourth consecutive session, albeit paring more than half of early losses, crossing below its 20-day moving average. The market sentiment was dented by weak global cues and sharp sell-off in material and energy stocks, owing to fall in commodity price. The concerns over record rise in COVID-19 cases and possible tapering in US economic stimulus also kept investors sidelined.
The ASX200 dropped 37.50 points or 0.50% to close at 7,464.60. Earlier today, the index opened lower and declined nearly 1% to hit an intraday low of 7,429.
The equity market witnessed mixed trading as six of 11 sectoral indices ended higher. The material sector declined the most and settled 3.3% lower. It was followed by energy, which dropped 2.3% Among others, A-REIT and utilities closed lower with over 1% loss.
Meanwhile, consumer discretionary sector emerged as biggest gainer, rising 1.54%. Some of the other best performing sectors were health care, industrial, telecom and information technology.
Investors also reacted to Australia’s jobless data, which dropped surprisingly to a 12-year low in July. The drop in unemployment rate was largely due to people falling out of the labour force as lockdowns in NSW and Victoria limited their ability to look for work.
The date released by Australian Bureau of Statistics (ABS) showed the jobless rate fell to 4.6% in July, but analysts warned that the actual picture of job market would become clearer from August and September data. Economists believe that the economy will contract sharply in September quarter.
Resolute (ASX:RSG) expects to recognise non-cash impairment in 2021 half-yearly results
Resolute Mining Limited (ASX:RSG) shared today that it anticipates to recognise a non-cash impairment charge in the range of US$165 – US$175 million in the Company’s 2021 half-year results. The results are scheduled to be released on Friday, 27 August 2021.
The expected impairment charge is a result of:
- The Company has assumed gold prices to come down, reflecting a 5-10% reduction in the short to medium term compared to the assessment carried out in December 2020.
- The Company held current cost, processing and recovery assumptions constant, without including expected improvements over the life of mine, in line with applicable accounting standards.
- An increase in the risk-free rate underpinned the applicable weighted average cost of capital used in the impairment assessment.
RSG closed 2.106% down at AU$0.465 per share today.
ASX snaps losing streak but COVID-19 woes remain; Redbubble jumps 10%
Australian shares snapped a four-session losing streak to climb as much as 0.6% by Friday afternoon, but worries about rising COVID-19 cases remained. The concerns about economic growth knocked sentiment after lockdown was extended in Sydney until the end of September. The decision was taken after New South Wales (NSW) reported 642 new local COVID-19 cases in the past 24 hours.
The ASX 200 was currently trading 20.40 points or 0.27% higher at 7,485 by lunch. The index opened on flat note and rose as much as 0.6% to reclaim psychological level of 7,500. In the past five session, the index has declined 1.9% amid a slump in commodity prices.
Investors also reacted to corporate earnings with some big player such as Sydney Airport, Cochlear, SelfWealth, PWR Holding, Ingham Group, TPG Telecom, Stockland and Smartgroup announcing their earnings results this morning.
On the sectoral front, ten of the eleven sectors were trading in green zone. The consumer staples was the best performer with 1.7% gain, followed by consumer discretionary, which rose 1%. Among others, utilities, A-REIT, financial, health care, energy and telecom also witnessed surge in buying activities.
Bucking the trend, material sector continued to stay under stress, owing to fall in iron ore price. The spot price of iron ore nosedived near 15% on Thursday, amid slump in demand for the steel-making material. In the material space, index heavyweight BHP Group (ASX: BHP) extended fall for the fourth session, falling over 4%.
The top gainer on ASX pack was e-commerce player Redbubble (ASX: RBL), which rallied 10.4% on robust earnings. On Thursday, the stock rallied over 18% after the global online marketplace reported 58% growth in sales revenue for FY21 financial year. Gross profit jumped 66% per cent to AU$223 million, while earnings before interest, taxes, depreciation and amortisation (EBITDA) zoomed up by a massive 930% to AU$53 million.
Some of the other notable gainers were poultry producer Inghams Group (ASX:ING), wine maker Treasury Wine Estates (ASX:TWE), e-retailer Kogan.com (ASX:KGN) and intellectual property services business IPH (ASX: IPH).
On the flip side, civil and mining contractor NRW Holdings (ASX:NWH) topped the losers chart with 5.6% loss. The stock surged 17% in previous session after reporting robust earnings for 2021 financial year.
Some of the other worst performers were global metal recycling firm Sims Ltd. (ASX:SGM), miner Lynas Rare Earths (ASX:LYC), hearing implant maker Cochlear (ASX: COH), and gold miner Pilbara Minerals (ASX:PLS).
Crude oil slips to three-month lows on rising coronavirus concerns
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Crude oil prices have slipped to a point last seen in May as investors pull back against the weakening global demand amid rising COVID-19 cases and rising US dollar.
- October delivery Brent Crude oil futures last traded at US$66.51 per barrel, whereas October delivery WTI crude oil futures traded 0.31% up at US$63.70 per barrel as of 20 August 2021 at 9:52 AM AEST.
- The crude oil rallied during the first half of 2021 but the prices have plummeted nearly 15% since the beginning of July.
- The new wave of Delta variant of coronavirus has sapped the demand for crude oil due to travel restrictions.
- Both the oil benchmarks have declined consecutively for the sixth day in a row, the longest losing streak after February 2020.
- Adding to that, the US dollar reached to the nine-month high level on Thursday, making greenback oil more expensive for other currency holders.
Sydney Airport (ASX:SYD) sees passenger decline of 36.4% in 2021 half year
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Sydney Airport (ASX:SYD), an international gateway that connects to more than 90 destinations around the world, shared its half year results and July 2021 traffic performance on Friday.
- Sydney Airport had six million passengers for the half year, a decline of 36.4% on the prior corresponding period (pcp).
- International passengers declined by 91.0% on the pcp, domestic passengers declined by 3.1% on the pcp.
- Loss after income tax expense of AU$97.4 million for the half year.
- EBITDA of AU$210.8 million, down 29.8% on the pcp.
- Net operating receipts (NOR) of AU$1.8 million, down 98.0% on the pcp.
- Tight cost control resulted in operating expenses1 of AU$74.2 million, down 7.8% on pcp.
- First half disciplined capital investment of AU$65.2 million focused on critical projects.
- Strong balance sheet with AU$2.9 billion of liquidity as at 30 June 2021.
The company also informed that it is excited to welcome 12 new luxury brands in 2022, all on long-term deals. In May 2021 also, Sydney Airport announced that it will reach Net Zero emissions by 2030.
The stock SYD was spotted trading 0.194% up at AU$7.735 per share today.
Humm Group (ASX:HUM) FY21 profit rises 121%, shares gain on ASX
Humm Group Limited (ASX:HUM) shared its full year 2021 results today.
- Humm has shared in its FY21 report that Cash Net Profit After Tax (NPAT) is AU$68.4 million, up 121.1% on pcp.
- The statutory NPAT stands at AU$60.1 million, up 160.2% on pcp.
- HUM’s active customer numbers grew 19.7% on the prior comparative period to 2.7 million.
- Buy Now Pay Later (BNPL) volume in FY21 was AU$1,034.9 million, up 31.3% on pcp
- The total number of app downloads in FY21 was 1.2 million, up 75.8% on pcp.
- The Commercial and Leasing volume for FY21 was AU$540.3 million, up 55.6% on pcp.
The stock closed 4.255% higher at AU$0.980 per share today.
ASX 200 trades positive after a flat opening
On the last day of the week, Australian shares have opened the session on a flat note. The ASX 200 is down by a mere 2.4 points after four straight sessions of losses this week. A steady rise in local COVID-19 cases have kept investors from becoming optimistic this week and capped their risk sentiment.
Crude oil fell to its lowest levels since May 2021, due to surging COVID-19 cases worldwide and the prospect of a looming Federal Reserve taper lowered risk appetite. The Dow Jones fell 66.59 points or 0.19% to 34,894.11, while the S&P 500 was 0.13% up to 4,405.79. The NASDAQ Composite closed the session 0.11% up, at 14,541.79.
Coming to the market breadth, seven out of the 11 sectors are trading higher today, with IT sector leading the pack with a 0.16% gain. Materials sector is down by 0.55%.
Stockland Corporation Limited (ASX:SGP) returned to profit in FY21, recording a statutory profit of AU$1.1 billion over the loss of AU$21 million in FY20. The profit also includes revaluation uplift of AU$432 million as its logistics, life sciences and technology portfolio recorded strong gains.
Cochlear (ASX:COH) posts a record sales revenue of A$1,493 million in FY21
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Healthcare giant Cochlear Limited (ASX:COH) shared its financial Results For the year ended June 2021 on Friday.
The Company shared that it has achieved record sales revenue of AU$1,493 million driven by a combination of marketshare gains, market growth and rescheduled surgeries from COVID shutdowns.
Other key highlights:
- Cochlear implant units increased 15% to 36,456, with developed markets up around 20% and emerging markets up around 10%. Compared to FY19, cochlear implant units increased 7%.
- Statutory net profit of AU$327 million includes AU$59 million in patent litigation?related tax and other benefits and AU$31 million in innovation fund gains after?tax.
- Underlying net profit rose 54% to AU$237 million.
- Underlying net profit margin of 16% was well above last year but below 18% longer?term target.
- A final dividend of AU$1.40 brings full year dividends to AU$2.55 per share, an increase of 59%.
- FY22 net profit guidance of AU$265?285 million, a 12?20% increase on underlying net profit for FY21.
ASX Buzzing Stocks: Cochlear, EROAD, Vista Group, Aspen
The Company shared that its balance sheet is strong with operating cash flows sufficient to fund investing activities and capital expenditure whilst delivering dividends to shareholders.
The net cash increased AU$108 million to AU$565 million, the ASX release stated.
The stock COH however, opened 5.717% down at AU$241.450 per share on the ASX.
Aspen (ASX:APZ) successfully completes equity raising of A$23.2 million
Aspen Group (ASX:APZ) shared on 20 August 2021 that it has completed institutional placement on Thursday, 19 August 2021 and has raised AU$23.2 million. The real estate Company has issued 17.455 million new APZ securities at an issue price of AU$1.33 per New Security.
As per the ASX release, the New Securities will settle on Tuesday, 24 August 2021, with allotment and normal trading to occur on Wednesday, 25 August 2021.
ASX Buzzing Stocks: Cochlear, EROAD, Vista Group, Aspen
The New Securities will rank equally with existing APZ securities and will be entitled to the distribution for the half year ending 31 December 2021.
Aspen confirms that, the Placement is within Aspen’s existing 15% placement capacity and accordingly securityholder approval is not required.
The stock APZ was spotted trading last at AU$1.510 per share on the ASX.
SelfWealth (ASX:SWF) delivers record growth in FY21
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Fintech firm SelfWealth Limited (ASX:SWF) shared its full year results for the FY21 financial year, with record growth across all key performance metrics.
- The Company recorded revenue up by 135% in FY21 to AU$18.4 million, up from AU$7.8 million in FY20, driven by a 105% increase in Active Traders.
- Active Traders increased by over 5,000 and the Company announced an important milestone
of achieving 100,000 Active Traders on 10 August.
- The Company indulged in diversified revenue streams as the US trading was launched in December 2020 and was adopted by 29% of total Active Traders within the first six months.
- The operating cash flow with the Company stands at AU$1.1 million in FY21, up from AU$147,000 in FY20.
- The Company boasts of a scalable business model as the gross profit margin rose from 33.4% in FY20 to 41.4% in FY21.
- Operating expenses increased by 41% on revenue growth of 135%.
- When it comes to investing in future growth, recently the Company has done a capital raise to build technology and product development team. Also, it has expanded marketing activities and investment in data and analytics capabilities.
The stock SWF traded last at AU$0.365 per share on the ASX.
Why Western Areas (ASX:WSA) shares gaining attention today?
The share price of Western Areas Ltd (ASX:WSA) gained 12.298% to trade at AU$2.785 per share at 1:50 PM AEST today as the Company responded on media reports in relation to a potential transaction involving Western Areas.
Western Areas stated that it is in preliminary discussions with IGO Limited in relation to a change of control proposal and the basis upon which engagement and due diligence between the parties could proceed.
The Company mentioned that this is quite an initial stage of discussions and there is no declaration regarding any transaction or the terms and conditions of any transaction.
Western Areas also said that it will keep the market updated.
Over The Wire (ASX:OTW) earnings up 35%
Over the Wire Holdings Limited (ASX:OTW), the telecommunications, cloud and IT solutions provider, shared a robust rise in recurring revenues. The Company has also shared that it has begun to experience the full benefit of recent investments across its integrated solution platform.
- The Company has achieved growth of recurring revenue by 38% to AU$103.2 million and delivered strong positive operating cashflows.
- The EBITDA rose from AU$17.4 million to AU$23.5 million, rising 35%.
- The Company has successfully achieved a customer retention rate of 97.8%.
- OTW has completed the acquisitions of Zintel, Fonebox and Digital Sense.
- OTW has also become a Tier 1 voice provider following the completion of a multi-year Carrier Interconnect project.
- Moreover, the commencement of the investment program is supposed to significantly upgrade the Company’s core network (SuperCore).
- Also, the board has declared a final dividend of 2.225 cents per share fully franked, taking the full-year payout to 4.0 cents per share.
The OTW stock was spotted trading at AU$4.490 per share at 1:50 PM on the ASX.
Vista’s (ASX:VGL) Movio signs multi-territory agreement with Vue International
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Vista Group International Ltd (NZX:VGL) (ASX:VGL) has announced today that Movio, a comprehensive film industry firm of Vista and Vue International have entered into a new three-year agreement to use the cinema campaign and data analytics platform of Movio - Movio Cinema.
According to the release, the deal brings together and replaces previous Movio agreements with Vue International’s cinemas across Europe covering all of Vue International’s key European territories; UK/Ireland, The Netherlands, Italy, Germany, and Poland, with Denmark expected to follow during the term.
ASX Buzzing Stocks: Cochlear, EROAD, Vista Group, Aspen
Vue International is a leading global cinema operator, managing the most distinguished brands in major European markets and Taiwan, spanning 9 countries, 226 sites, and 1,997 screens. Vue was looking for merging its territories with a single provider to accomplish the advantages of scale across Movio’s product features, services and commercials.
The concerned deal also enables the Company for entering new regions.
Meanwhile, the stock VGL traded last at AU$2.050 per share on the ASX.
EROAD (ASX:ERD) partners with Seeing Machines
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Transportation technology services company EROAD (ASX:ERD) (NZX:ERD) shared on Friday that it has struck a strategic deal with Seeing Machines, a vision-based monitoring technology firm that enables machines to see, understand and assist people.
The ASX release stated Seeing Machines’ world-leading Guardian technology utilises face and eye tracking algorithms to detect fatigue and distraction, allowing proactive intervention before a risky driving incident occurs.
ASX Buzzing Stocks: Cochlear, EROAD, Vista Group, Aspen
The assimilation of this technology with EROAD will give operators a single tool for managing video telematics making it easier for fleet managers to prioritise actionable insights from data as well as developing a greater understanding of the risks associated with their fleet and coach drivers. Earlier, there two separate managing systems to do the same.
With an aim to make roads safer and more sustainable, EROAD is working towards developing technology solutions to manage vehicle fleets, support regulatory compliance, improve driver safety and reduce the costs associated with operating a fleet of vehicles and inventory of assets.
Meanwhile, on the ASX, the stock ERD traded last at AU$5.900 per share.
Fatfish (ASX:FFG) surges 11% on funding for BPNL businesses in Southeast Asia
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Tech venture investment firm Fatfish Group Limited (ASX:FFG) has raised AU$8 million of fresh funding from US-based fund Arena Investors L.P. (Arena Investors). FFG will use the fund to boost its BNPL and fintech businesses, including rolling out its retail Buy-NowPay-Later (BNPL) business in Southeast Asia.
Funding will be via convertible notes that convert at a fixed price of seven cents per share, an 18% premium to the prior day closing price. FFG has an existing strategic long term funding deal with Arena Investors. With the New Funding deal, Arena Investors will provide an immediate AU$8 million in cash consideration to FFG. The Convertible Notes have a tenure of 12 months and will carry a coupon rate of 1% per annum. These will be convertible into ordinary shares of FFG at the request of Arena Investors.
FFG is actively building BNPL and digital lending services in Southeast Asia. Some of its businesses include Smartfunding, an online lending platform; Pay Direct, an online payment gateway etc. Current funding will further expand FFG’s business in the region.
FFG shares were trading 13.559% up on ASX at AU$0.067 as of 19 August 2021, 1:15 PM AEST.
ASX 200 to open higher despite Wall Street closing mixed
The Australian shares are expected to end the week on a positive note despite US shares closing mixed overnight. However, a steady rise in domestic COVID-19 cases may cap risk sentiment. The ASX 200 may open 39 points or 0.5% higher on Friday after falling 0.5% lower at 7,464.6 on Thursday.
Adairs, Cochlear, Cleanaway, Inghams, Stockland, Sydney Airport Group and TPG Telecom are a few firms that would be releasing their earnings on Friday.
On Wall Street, the Dow Jones fell 0.2%, the S&P 500 climbed 0.1%, and the NASDAQ rose 0.1%. The surge in coronavirus Delta cases across US dented prospects of early recovery of economy, with recent economic data painting a weak picture.
Meanwhile, the minutes from Federal Reserve’s July meeting strengthened expectations that the central bank may roll back stimulus before year's end barring some unpleasant economic surprise.
National unemployment rate falls by 0.3 percentage points: ABS
The Australian Bureau of Statistics shared the latest employment details on 19 August 2021 as per which the seasonally adjusted employment in Australia rose by 2,000 people in June and July. Also, the hours worked declined by 0.2%.
The ABS stated that the changes happened in the labour market in June and July impacted the national figures hugely. In NSW, the whole labour force reduced by around 64,000 people. Also, hours worked in NSW fell by 7%.
Key takeaways from ABS release:
- The national participation rate declined by 0.2 percentage points to 66% and the unemployment rate fell by 0.3 percentage points.
- The underemployment rate rose for the second straight month, up 0.4 percentage points to 8.3% in July.
ASX trims losses to 0.5%; BHP, Mineral Resources, IGO hammered
Australian shares continued to trade lower by afternoon, albeit erasing half of early losses, led by sharp sell-off in blue-chip mining stocks such as BHP, Rio Tinto, Fortescue, and Mineral Resources. The weak cues from Wall Street and fall in commodity prices also weighed on market sentiment, while record spike in COVID-19 cases also left investors jittery. In the last 24 hours, NSW reported 681 new local inflections, a new daily record for the state.
The ASX 200 was currently trading 35.40 points or 0.47% lower at 7,466.70 by lunch. Extending losses for the fourth straight session, the index opened lower today and declined as much as 1% to hit a low of 7,429.
On the sectoral front, eight of the eleven sectors were trading in red. The material sector was the worst performer with over 3% loss, owing to fall in iron ore price. Iron ore slumped 4.6% overnight to US$153.39 a tonne. In the material space, index heavyweight BHP Group (ASX: BHP) was the worst performer, followed by Rio Tinto Group (ASX: RIO) and Fortescue Metals Group (ASX:FMG).
Material sector was followed by energy, which dropped 1.8% due to slip in crude oil prices. The oil prices have also softened with Brent crude dropping 2.4% to US$67.41 per barrel, while US oil fell 3.1% to US$64.52 a barrel.
Among others, A-REIT, consumer staples, utilities and telecom witnessed selling pressure.
Bucking the trend, consumer discretionary sector emerged as the best performer with 0.8% gain. Information technology and health care sector also saw spurt in buying activity.
Civil and mining contractor NRW Holdings (ASX:NWH) topped the gainer’s chart by rising nearly 14%. Some of the other notable gainers were telecom service provider Chorus (ASX: CNU), financial services firm Netwealth Group Ltd (ASX: NWL), gaming and entertainment firm Star Entertainment Group (ASX:SGR) and travel firm Corporate Travel Management (ASX:CTD).
On the flip side, tech firm Codan (ASX: CDA) emerged as top loser, falling 8.7%. Some of the other top laggards were mining firm Mineral Resources (ASX:MIN), metal and mining group IGO (ASX: IGO), iron ore miner BHP Group (ASX:BHP) and royalty company Deterra Royalties (ASX:DRR).
Tin skyrockets on stocks shortage and surging demand
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Tin prices skyrocketed to record levels amid surging demand of the metal in electronic gadgets and portable devices and supply disruptions.
Three-month tin on the London Metal Exchange (LME) last week touched US$35,955 per tonne, surpassing the highest level last seen in 2011.
Currently tin is trading around US$35,400 per tonne, relatively 74.26% up year-till-date.
Tin is a silver malleable metal, extensively used in soldering and for coating other metals to stop corrosion.
Myanmar, Peru, Thailand, Bolivia, Malaysia, China, and Indonesia are among the leading producers of tin.
The demand for tin surged after the lockdowns last year that recorded a boom in the sales of digital and smart devices.
At the same time, supply disruptions in Asia and Africa due to the impacts of coronavirus created additional supply deficit in the market.
Supply has also suffered due to power rationing and drought conditions in China's Yunnan province.
Crude oil slips on surging COVID-19 cases
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Crude oil prices inched lower on the sixth consecutive day on Wednesday due to rising coronavirus cases across the globe and investors’ concern over fuel demand outlook.
- October delivery Brent Crude oil futures traded 0.12% up at US$67.36 per barrel, whereas October delivery WTI crude oil futures traded 1.35% down at US$64.33 per barrel as of 19 August 2021 at 10:30 AM AEST.
- Both the oil benchmarks were under pressure due to the rise in the Delta variant of coronavirus. Several countries have re-imposed lockdowns and travel restrictions.
- As per the U.S. Energy Department data, US crude oil inventories tumbled 3.2 million barrels last week to land at 435.5 million barrels.
- On the flip side, gasoline demand rises modestly by 9.5Mbpd, roughly 1% less than the levels last seen in 2019.
- Adding to that, the US crude oil production continued its steady run with 11.4Mbpd in the last week.
- The demand for crude oil is expected to rise at a slower pace in the remaining 2021 because of surging COVID-19 cases, stated by the International Energy Agency.
AstraZeneca to change vaccine’s name to Vaxzevria in Australia
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The touted vaccine for COVID-19, AstraZeneca, will be undertaking a name change in Australia in order to make it simpler for ‘vaccinated’ people to travel internationally.
The vaccine manufacturer has declared that the vaccine will now be known as Vaxzevria and this is just a part of a global name-change plan to make sure that people who have received the jabs are able to move internationally swiftly when borders open up.
The pharma company has stated that the rebranding programme has been started in the European Union and this renaming planned in Australia will just add the ongoing uniform branding plan.
It should be noted that AstraZeneca has been in news since it led the vaccination rollout in Australia when a couple of deaths were linked to the name of the vaccine and the pharma company.
The company stated that there is no difference in the vaccine even after the name change and it is the same product which is being made at the CSL labs in Australia.
The vaccine has also got the emergency authorisation from the World Health Organisation.
Venture (ASX:VMS) books first shipment at Riley Iron Ore Mine, shares skyrocket on ASX
Venture Minerals Limited (ASX:VMS) shared on Thursday that commissioning of the Wet Screening Plant at the Riley Iron Ore Mine has been completed. The Wet Screening Plant is now fully installed and completely operational. As a result, 24-hour processing is now on, and the first stage of steady state production has been achieved.
The Company suggested that completion of commissioning of the Wet Screening Plant has facilitated constant ore transport from the Riley Iron Ore Mine to the Port of Burnie. The haulage and port services agreement with Qube was recently signed and activated.
The AX release said that iron ore production from the Plant commissioning phase, along with present steady state production, has given a chance to Venture to charter its first bulk carrier vessel with a capacity of 46,000 tonnes from a key international shipping operator.
The stock VMS was spotted trading 23.493% higher at AU$0.102 per share at 11:00 AM AEST.
ASX 200 opens lower; local miners accelerate fall
The Australian benchmark, the ASX 200 has opened in red as Wall Street ended lower overnight. The index was 0.43% down or 32.3 points lower at 7,469.8 at the open. A correction in commodity prices is also weighing on the local miners while a steady increase in the country's COVID-19 infections is making the markets jittery.
As of 10:30 AM AEST, the ASX 200 has fallen further to 7,440.8, shedding 0.82% or 61.3 points. The ASX All Ordinaries Index has also taken a hit of 0.73% or 56.9 points to 7,713.8.
Over The Wires Holdings Limited (ASX:OTW) has clocked a 29% increase in FY21 revenue to AU$112.7 million, however, the net profit has come down to AU$3.4 million, from AU$5 million last year. A one-time AU$3.9 million amortisation charge was the major hit to the profit figure.
Origin Energy (ASX:ORG) makes a loss of A$2,291 million
The Utilities focused firm Origin Energy Limited (ASX:ORG) shared its 2021 full-year results on Thursday.
The Company has announced a statutory loss of AU$2,291 million for the entire year ended 30 June 2021. This mainly comprises AU$2,247 million of non-cash charges including impairments and a deferred tax liability.
Hot Stocks: Newcrest Mining, Treasury Wines, Origin Energy
The Company reported underlying profit of AU$318 million is suggestive of lower commodity prices both in the Energy Markets and Integrated Gas divisions.
Company’s Free Cash Flow remained robust at AU$1,140 million driven by a high cash conversion in Energy Markets due to lower working capital requirements and lower interest and tax payments.
Origin has shared a strong cash flow enabled debt reduction of AU$519 million and allowed investment in growth and dividends to shareholders at the same time.
The ORG board has determined an unfranked final dividend of 7.5 cents per share.
Energy Markets: Underlying EBITDA for Energy Markets was AU$991 million, down 32% on the prior year. Total customer accounts rose by 30,000. This mainly was triggered by expansion in broadband, community energy services and gas.
Integrated Gas: Integrated Gas Underlying EBITDA was AU$1,135 million, a 35% reduction on the prior year.
The stock ORG traded last at AU$4.370 per share on the ASX.
Newcrest Mining (ASX:NCM) delivers record returns at Cadia mine and in FY21 results
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Newcrest Mining Limited (ASX:NCM) has approved the Cadia PC1-2 Pre-Feasibility Study and will now commence the Feasibility Stage and Early Works Program. It has also delivered record profit, free cash flow and a 129% increase in final dividend in FY21.
Cadia PC1-2 Pre-Feasibility Study
NCM has approval for funding of AU$120 million for Early Works Program at Cadia, which are to begin from December 2021 quarter. The PC1-2 Pre-Feasibility Study has estimated total capital expenditure of AU$1.3 billion and an after-tax Internal Rate of Return (IRR) of 21.5%. It has a 17-year mine life from its first production. Feasibility Study has now commenced.
NCM achieved gold production of 2.1 million ounces and a record copper production of 142.7 thousand tonnes in FY21. It earned a record statutory and underlying profit of AU$1.2 billion, up 80% and 55%, respectively. The annual free cash flow was AU$1.1 billion and a record AISC margin of 49% in FY21. NCM also had a strong balance sheet with a net cash position of AU$176 million as of 30 June 2021.
Hot Stocks: Newcrest Mining, Treasury Wines, Origin Energy
NCM shares last traded at AU$25.270 on the ASX.
PointsBet (ASX:PBH) selected as NFL approved sportsbook operator
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Corporate bookmaker PointsBet Holdings Limited (ASX:PBH) is now National Football League's (NFL) approved sportsbook operator (ASO) for upcoming 2021 season.
PBH will thus have sponsorship opportunities and brand visibility from its' unique integrations across various TV and digital assets, including NFL, owned networks and other media partners. PBH also gains use of official NFL data, enhancing its' customer experience. As per ASX release, this selection acts as cornerstone for PBH to provide the fastest and most comprehensive in-play betting experience worldwide.
Earlier this year, PBH announced that NFL and future Hall of Famer Drew Brees officially has joined the team as a brand ambassador. Brees is this season entering a broadcasting career with NBC Sports – PBH's official sports betting partner, and this will deepen the NBC Sports and PBH relationship.
NBC Sports will also provide PBH full year, multi-platform media and marketing opportunities for all of its events.
PBH shares traded last at AU$10.280 per share on the ASX.
Austin (ASX:ANG) approves major APAC Manufacturing Investment
Mining equipment design and manufacturer, Austin Engineering Limited (ASX:ANG) shared today that it has commenced a AU$6.5 million capital investment to transform and automate its design and manufacturing facilities at its major Asia Pacific centres in Perth and Indonesia.
The CAPEX program will feature a new manufacturing flow approach with increased automation, custom jigs, fixtures, workstations and a standardised manufacturing approach to building product. Austin will still be able to provide customised engineering solutions and products to its customers while leveraging the benefits of a production flow line. In particular, Austin sees major benefits to its truck body product offering, which comprises nearly 70% of Austin’s annual revenues.
As per the release, the expected payback period is twelve months post-implementation, with the majority of benefits to be realised in FY2023. However, the Company expects, incremental benefits will be achieved during the latter months of FY2022.
Funding for the plans will be done via operating cash flows and surplus asset sales.
Meanwhile, the stock traded last at AU$0.192 per share on the ASX.
Treasury Wines (ASX:TWE) survives China taxes, marks NPAT up 2%
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Treasury Wine Estates Limited (ASX:TWE), on 19 August 2021, shared its annual 2021 financial result, with NPAT up 2% to AU$250 million and EPS up 2% to 34.7 cents per share.
TWE reported EBITS of AU$510.3 million, in line with the prior year, and EBITS margin 0.6 ppts higher to 19.9%.
Hot Stocks: Newcrest Mining, Treasury Wines, Origin Energy
The Company shared that the F21 EBITS of AU$510.3 million was quite in line with the prior year despite Mainland China EBITS declined by $77.3 million. Also, EBITS margin rose 0.6 ppts to 19.9% and EBITS increased 3% on an organic basis.
The Company’s announcement stated that NSR per case rose across all regions, triggered by regular premiumisation and consumer-led portfolio expansion, with the Luxury and Premium portfolios now contributing 77% of global NSR, up from 71% in F20.
Also, TWE reported a full year cash conversion 100.8%, with Net Operating Cashflow 4%.
TWE shared, a strong, flexible balance sheet and investment grade credit profile has been retained, with Net Debt down AU$376.5 million in F21 to AU$1,057.7 million.
The Wine manufacturer has declared a final dividend of 13.0 cents per share, fully franked. This is a straight rise of 62.5% on F20 final dividend.
Meanwhile, operations wise, in F21, TWE delivered strong growth in the $10-30 Premium portfolio in the Americas, EMEA and ANZ regions, led by 19 Crimes, Pepperjack, Squealing Pig, Beringer Brothers and Matua. These positive growth trends were moderated by ongoing global pandemic disruptions, higher COGS and significantly reduced shipments to Mainland China following the introduction of import duties on Australian wine.
Also, TWE informed that starting from 1 July 2021, it will be adopting a new business model under three brand-led portfolio divisions – Penfolds, Treasury Premium Brands and Treasury Americas.
The stock TWE traded last at AU$12.690 per share on the ASX.
Australian share market to fall after Wall Street declines
The Australian shares are expected to open lower on Thursday after Wall Street and crude oil declined as July monetary policy meeting minutes showed that US Federal Reserve officials eye taper by year-end. In addition, a fall in commodity prices may exert pressure on the domestic miners, while a steady rise in the country's COVID-19 cases could negatively impact market sentiment. ASX-listed firms such as Newcrest, Evolution and South32 would be releasing their earnings report on Thursday.
The ASX 200 is expected to open 51 points or 0.7% lower this morning after ending down 0.1% at 7,502.1 points on Wednesday. On Wall Street, the Dow Jones dropped 1.1%, the S&P 500 fell 1.1%, and the NASDAQ tumbled 0.9% lower.
The minutes revealed that Fed officials expected that the central bank’s monthly debt purchases could ease this year if the economy continued to improve on expected lines. While a section of officials also believed that the fast spread of the coronavirus Delta variant may temporarily delay the full reopening of the economy.
While ongoing spread of Delta variant has triggered concerns that the global economic rebound may get delayed, turmoil in Afghanistan and fresh crackdown on tech sector in China added worries. According to data released on Wednesday, US homebuilding declined on a higher-than-expected rate in July.
Following the release of Fed minutes, US Treasury yields also fell and benchmark 10-year notes dipped to 1.2634%.