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

Financial Planner’s morning report – Tuesday

The ASX 200 (ASX:XJO) followed a negative lead from Wall Street, falling 1.5%, albeit on lower volumes amid the beginning of school holidays. The market traded as low as 2.2% throughout the day, with chronic underperformers in the property sector like Unibail-Rodamco-Westfield (ASX:URW) seeing significant tax loss selling as 30 June nears.
In Practice

Markets

The ASX 200 (ASX:XJO) followed a negative lead from Wall Street, falling 1.5%, albeit on lower volumes amid the beginning of school holidays. The market traded as low as 2.2% throughout the day, with chronic underperformers in the property sector like Unibail-Rodamco-Westfield (ASX:URW) seeing significant tax loss selling as 30 June nears.
With a single day of trade remaining, the market is off 13% for the financial year, the worst since 2009. US and European stocks recovered on better than expected economic data, with the S&P 500 erasing its June losses, finished up 1.5% and the Dow Jones Industrial Average up 2.3%. The driving force was twofold, record pending home sales, with contracts signed growing 44% in May, and the hope for additional stimulus from the Federal Reserve.
Boeing Co. (NSYE:BA) was the highlight, up 14% after test flights of the 737 Max were approved. In Europe, it was the financial sectors pushing higher behind the likes of Germany’s Commerzbank (DE:CBKG), with the Eurostoxx 600 up 0.6% due to their strong relative performance against the US in reopening the economy.

The next CSL?

Fisher & Paykal Healthcare Ltd (ASX:FPH) continues to stake a claim as the new CSL Ltd (ASX:CSL), rallying 6.8% on Monday after reporting a 37% improvement in profits. FPH manufacturers ventilators and benefited from a 300% increase in sales to hospitals resulting in an 18% jump in revenue for the year ended 31 March.
The result was a 15% increase in the dividend, sending the 2020 gains to 60%. As Qantas Ltd (ASX:QAN) fell below its capital raising price, off 5.0%, Regional Express Holdings Ltd (ASX:REX) added 17.0% after confirming its intention to enter the Melbourne-Sydney-Brisbane route. As highlighted previously, there is simply too much uncertainty in the travel sector to warrant an investment, and I’m surprised the QAN raising started with a $3 not a $2.
Finally, Lotto operator Jumbo Interactive Ltd (ASX:JIN) fell 13.2% despite announcing a new 10 year deal with Tabcorp Holdings Ltd (ASX:TAH) in Queensland, with investors seemingly disappointed in stepped fee increases to 4.65% in 2023.

Renewables getting interesting

The renewable energy sector has become more interesting by the day, with UAC Energy and Iberdrola in a bidding war for Infigen Energy Ltd (ASX:IFN), the takeover offer now hitting $0.89 cents per share. The wind farm operator joins the now Federation and Minderoo owned Windlab (ASX:WND) in the hottest sector of the moment.
Whilst the transition to a lower carbon economy has been heavily impacted during the COVID-19 crisis, trillions of dollars in stimulus, particularly across Europe and Asia, has been specifically targeted at the sector as Government’s embark on ‘Green New Deals’ and seek to exit the crisis stronger than before.
We enter the final day of trading for the financial year in a very different place to where it started, with central banks once again determining the outlook for investors. With some complacency creeping into markets, it’s my view that investors should be considered substantial changes to their investment strategy as we enter uncharted territory.
 
The daily report is written by Drew Meredith, Financial Adviser and Director of Wattle Partners.




  • Print Article

    Related
    A great way to play the booming natural gas market

    Longreach taps into the LNG market supported by projects in Texas & Oklahoma.

    Ishan Dan | 11th Aug 2022 | More
    ASIC levy review targets adviser ‘time-lag’ issue

    The review will consider “the consequences of time lags between regulatory action and cost allocation”, the terms of reference states.

    Tahn Sharpe | 11th Aug 2022 | More
    AMP Advice to ‘break even’ by 2024 as losses soften

    The institutional provider’s AUM and profit lines stayed red in 1H22, but positive signs emerged.

    Tahn Sharpe | 11th 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
    5
    Quality of advice review focused on advisers, not consumers
    Drew Meredith | 11th Jul 2022 | More