Home / In Practice / Financial Planner’s morning report – Friday

Financial Planner’s morning report – Friday

Sharemarkets around the world capitulated on Thursday as concerns of a second wave of the Coronavirus hit the US, the S&P 500 shedding (SPX:IND) 5.9% with only one constituent, grocery retailer Kroger’s Inc. (NYSE:KR) posting a positive return.
In Practice

Second wave……

Sharemarkets around the world capitulated on Thursday as concerns of a second wave of the Coronavirus hit the US, the S&P 500 shedding (SPX:IND) 5.9% with only one constituent, grocery retailer Kroger’s Inc. (NYSE:KR) posting a positive return.
The Dow Jones Industrial Average (DOW:IND) fell over 1,800 points or 7.1%, driven down by the likes of Bank of America (NYSE:BAC) and Goldman Sachs (NYSE:GS) off 10% and 9% respectively. The story was much the same in Europe with the Stoxx 600 down 4.1%.
Expect the Australian banking sector, including the Commonwealth Bank of Australia Ltd (ASX:CBA) along with consumer facing businesses like Webjet (ASX:WEB) to be hit heavily at the open.
On the positive side, gold continued to rally as US COVID-19 deaths exceeded 111,000, hitting USD$1,740, whilst the slide in the AUD back down to $0.68 should offer some protection for the ASX 200 (ASX:XJO).

All streaks must come to an end

The ASX 200 felt the immediate brunt of US weakness, leading global markets down 3.1%, with the financial sector experiencing the strongest falls, National Australia Bank Ltd (ASX:NAB) off 6% alone.
Global gold miner Newcrest (ASX:NCM) was one of the few bright spots on an otherwise difficult day adding nearly 6%. Kogan Ltd (ASX:KGN) and JB Hi-Fi Ltd (ASX:JBH) remain the bright spots of the Australian consumer sector, with the latter reporting 20% growth in Australia like for like store sales and 23% growth at The Good Guys whitegoods retailer for the five months to 31 May, predicting profit will increase 20-22% for the financial year.
Just as the AFL season got off and running with the lowest scoring game in recent history, Seven West Media (SWM) announced they have renegotiated their agreement with the association, extending for a further two years but saving some $87 million in 2020 and 2021. With signs of a second wave, here’s hoping the manage to keep the season afloat.

Everyone needs to eat

After highlighting Uber Technologies Inc. (NYSE:UBER) aggressive approach to profitable home delivery app Grub Hub (NASDAQ:GRUB), their European counterpart Just Eat Takeaway appears to have beaten them to the bunch, acquiring the business in an all-scrip deal valued at $7.3 billion; the stock was up 4%.
Tesla (NASDAQ:TSLA) quickly became the most valuable car manufacturer in the world, passing Toyota with a capitalisation of $190 billion, yet to us it is abundantly clear the company is anything but car manufacturer at this stage of its life.
Redflow (ASX:RFW) a unique Australian company producing a series of portable batteries to aid the world’s transition to a lower carbon economy announced sales were up 166% but announced a capital raising amid the Coronavirus shutdown; an interesting one for the real risk takers.
Finally, despite increasing volatility in sharemarkets, a flood of unrented apartments and huge rental discounts is likely to reduce the attractiveness of property for many years to come, with shares to benefit.
 
The daily report is written by Drew Meredith, Financial Adviser and Director of Wattle Partners.




  • Print Article

    Related
    Higher inflation, recession more likely: Franklin Templeton

    Late July news of the Federal Reserve (Fed) increasing interest rates another 0.75% and a second negative quarter of economic growth (GDP) has created an uncertain environment for investors going forward. Adding to these concerns is China’s economic slowdown and Europe’s energy shock.  Stephen Dover, Chief Market Strategist, at the Franklin Templeton Investment Institute presents…

    Stephen Dover | 15th Aug 2022 | More
    Jones looks to shorten exam, improve ethics code

    Once the Quality of Advice Review is done, the new financial services minister has asked Treasury to look at updating the Code of Ethics and assessing the viability of a shortened adviser exam.

    Tahn Sharpe | 15th Aug 2022 | More
    AZ NGA dives into supply chain with Virtual Business Partners tie-up

    The Italian-backed group has teamed up with one of AMP’s largest advice businesses to take a major stake in the back-office services provider. It’s the first time AZ NGA has ventured beyond advice and accounting investment.

    Tahn Sharpe | 15th Aug 2022 | More
    Popular
    1
    Advisers urged to tread carefully with ‘wholesale investor’ status
    Staff Writer | 28th Jul 2022 | More
    2
    Top hedge fund award goes to L1 Capital
    Greg Bright | 13th Dec 2021 | More
    3
    MAX Award winners and the new world outside
    Greg Bright | 13th Jun 2022 | More
    4
    INDepth with Andrew Lockhart from Metrics Credit Partners
    The Inside Adviser | 30th Jun 2022 | More