Market Insights – 10/03/2020

Market Insights – 10/03/2020

Market Insights

10th March 2020

Top Stocks

CODE PRICE MOVEMENT   CODE PRICE MOVEMENT
CBA $69.15 -13.62%   NAB $20.14 -18.13%
BHP $27.55 -16.74%   TLS $3.48 3.57%
WBC $19.52 -16.01%   WES $37.89 -4.80%
RIO $80.77 -6.78%   CSL $295.96 -0.89%
ANZ $20.27 -16.96%   WOW $37.47 -0.69%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUSTRALIAN DOLLAR IS BUYING

All Ords

5,822.40

-7.40%

 

US Dollar

0.6583

Dow Jones

23,851.02

-7.79%

 

Euro

0.5751

FTSE-100

5,965.77

-7.69%

 

GB

0.5016

Nikkei 

19,698.76

-5.07%

 

Yen

67.2680

Commodities

Oil (WTI)

41.370

-9.65%

Gold

1,675.800

0.20%

Iron Ore

90.120

-1.04%

Major Market Announcements

– Wall Street suffered its biggest one-day loss since the 2008 financial crisis on Monday and recession worries loomed large as tumbling oil prices and ongoing coronavirus fears prompted investor panic on the anniversary of the U.S. stock market’s longest-ever bull run.

– The continued spread of COVID-19 across the world has administered a shock to the global economy, with material impacts already felt on both the supply and demand side. Yet while central banks and governments appear ready to take further measures, it is not yet clear whether they will be enough to counteract market headwinds.

– As if there wasn’t enough global uncertainty already, a likely price war has broken out over the price of oil. The OPEC+ alliance between Saudi Arabia and Russia to prop up oil prices collapsed over the weekend, with both countries expected to ramp up production in a stunning reversal of policy. Brent crude futures, which had traded as high as $US65 a barrel as recently as January, plunged from $US45 a barrel on Friday to around US$32 at 1451 AEDT on Monday. The ASX energy sector had plummeted 19 per cent, more than twice the dive of any other sector.

Market Update

The Australian share market has lost almost $140 billion in Monday’s trade, amid the economic fallout from the coronavirus and an oil price war.

At the same time, the Australian dollar briefly tumbled to just above 63 US cents — the lowest level since the global financial crisis — in what currency strategists have called a “flash crash”.

Overall, it has been the worst day of trade since October 2008, when the GFC took a turn for the worse, and the rout is hammering share portfolios and superannuation balances.

The share market tumbled more than 5 per cent in early trade but plummeted again over lunchtime.

But stocks tumbled further at the close with the ASX 200 index losing 7.3 per cent or 456 points to close at 5,761.

That is a paper loss on Monday of $137 billion, with $413 billion lost since the market’s record high on February 20 of 7,197.

The All Ordinaries index plummeted by 7.4 per cent or 465 points to end at 5,822.

What A Long Weekend

THREE DAYS CAN SOMETIMES BE A LONG TIME

A DEADLY COMBINATION – OIL WAR and CORONAVIRUS

Well as if we did not have enough going on around the World with the Coronavirus effects on share markets. Over the weekend the pure uncertainty of what the future holds was added to what might be determined an Oil “war” with up to a 30% drop in oil prices around the globe and hence a big flow on to oil company share prices and a flow on to other companies.

Essentially, what happened is that Russia did not want to reduce production of oil as suggested by the governing body OPEC in preparation for an expected drop in demand in light of the Coronavirus. This destabilised the energy market and Saudi Arabia decided to cut its oil prices. The market reacted.

On Monday, Australian markets fell in the order of 7% and America did likely last night (our time) on top of the recent turmoil.

With the risk of repeating what we wrote about at the end of February. Please see below updated figures for the 9 days since.

Always looking not less than one year to keep things in perspective – Clients asset holdings within portfolios in typical Diversified (70% growth assets) could be expected to be approximately still slightly up or slightly down (depending on their exact asset mix) where they were at the end of February 2019. Until recently it had been a great year and some markets definitely got ahead of themselves. For clients who are more defensive with say 50% in Growth Assets then as of now they should be still up slightly, again depending on their exact mix of assets.

Overall, we believe the big issue is still the Coronavirus and once we get any sort of positive news whether decline in numbers worldwide, containment is working or of course scientists have a proven vaccine available for mass production we know that markets will react positively both quickly and significantly.

At Plus 1 Group we are available at any time to discuss issues of this nature with due regard to your investments or financial planning generally.

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

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T: (03) 5833 3000
F: (03) 5831 2988
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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 10/03/2020

Market Insights – 02/03/2020

Market Insights

2nd March 2020

Top Stocks

CODE

PRICE

MOVEMENT

 

CODE

PRICE

MOVEMENT

CBA

$81.78

-6.65%

 

NAB

$25.10

-7.28%

BHP

$33.60

-11.42%

 

TLS

$3.43

-7.80%

WBC

$23.64

-7.84%

 

WES

$40.65

-8.28%

RIO

$87.27

-10.49%

 

CSL

$309.44

-7.08%

ANZ

$24.83

-7.83%

 

WOW

$38.80

-9.15%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUSTRALIAN DOLLAR IS BUYING

All Ords

7,230.40

-0.34%

 

US Dollar

0.6595

Dow Jones

28,992.41

-0.78%

 

Euro

0.6091

FTSE-100

7,403.92

-0.44%

 

GB

0.5091

Nikkei 

23,386.74

-0.39%

 

Yen

73.4393

Commodities

Oil (WTI)

45.210

-2.33%

Gold

1,587.300

-3.21%

Iron Ore

86.580

-0.14%

Major Market Announcements

– Vermont Senator Bernie Sanders may be surging in the polls ahead of Super Tuesday, but some on Wall Street have made their own conclusions on what November will bring: four more years of President Donald Trump.

– The uncertainty surrounding the containment of the coronavirus and how the US markets will again react will have Australian investors “twitchy” when the sharemarket reopens on Monday. AMP Capital’s chief economist, Shane Oliver, forecast a dip on the ASX200 index of about 1 per cent following a slight fall in the futures over the weekend.

– Federal stimulus measures worth up to tens of billions of dollars are needed economists say as they warn more Australian companies are likely to announce profit warnings due to coronavirus.

– Flight Centre has slashed its full-year profit guidance amid the worsening impact of the coronavirus outbreak on the travel sector and as its first-half profit plunged. 

– Jetstar workers have agreed to a pay deal following strike action that forced the Australian budget airline to ground dozens of flights. The agreement comes after a year-long industrial battle for ground crew that led to a fresh round of strikes last month, forcing the airline to ground 48 flights across Australia.

Market Update

The Australian sharemarket has suffered its worst day in over four years, closing the day at a six-month low amid a growing panic the coronavirus outbreak will trigger a global recession.

The S&P-ASX 200 index finished on Friday down 216.7 points, or 3.25 per cent, at 6441.2, while the all ordinaries index plummeted 225.9 points, or 3.35 per cent, to 6511.5.

For the week, the ASX 200 lost 697.8 points, or 9.77 per cent, for its second-worst string of losses, exceeded only by a 15.65 per cent dive in October 2008 during the global financial crisis.

Since hitting an all-time high of 7197.2 last Thursday, it has declined for six-straight days, losing 756 points, or 10.5 per cent.

That means it is now in official correction territory, having suffered a drop of more than 10 per cent from a recent highs.

Friday’s 3.25 per cent dive was the worst since a 3.8 per cent, or 195-point drop on September 29, 2015.

“Today felt like panic selling,” said Pepperstone head of research Chris Weston.

“Whether this was a capitulation or there is more to it, this felt different“ from the substantial declines earlier in the week, Mr Weston said.

“The rug got pulled from the market today. The ferocity of the selling isn’t something we have seen for a long long time,” he said.

Every sector was down at least one per cent and most fell over three, with the tech sector the worst hit, down 4.71 per cent as Afterpay plummeted 9.1 per cent to a one-month low $33.17.

The mining sector suffered the second-biggest losses, falling a collective 4.67 per cent as mining giant BHP dropped 4.5 per cent to a one-year low of $33.60, Rio Tinto fell 3.5 per cent to a five-month low of $87.27 and Fortescue Metals declined 6.4 per cent to a more than two-month low of $10.08.

Gold miners were not immune from the carnage, with NewcrestNorthern Star and Saracen all plunging between 8.0 and 9.8 per cent.

Woolworths dropped 3.5 per cent to $38.80 and Wesfarmers dropped 2.9 per cent to $40.65.

Among the big banks, Commonwealth and NAB both dropped 3.1 per cent, to $81.78 and $25.10, respectively, while ANZ dropped 2.7 per cent to $24.83 and Westpac fell 2.8 per cent to $23.64.

Harvey Norman was the biggest ASX200 loser, falling 14.1 per cent to a nine-month low of $3.71 after announcing its first-half profit had been hit by bushfires as stores in regional areas closed temporarily.

Just 14 companies among the ASX300 gained on Friday, while another six were flat.

The Aussie dollar meanwhile was dropped further, hitting an 11-year low of US65.16¢, having declined 1.6 per cent against the greenback this week and 7 per cent so far this year.

The Aussie was buying US65.22¢, down from US65.50¢ at the market close on Thursday.

Looking forward, IG market analyst Kyle Rodda said that markets were most concerned about the spread of the coronavirus in the world’s largest economy, the US, following the infection of a California woman this week.

Mr Rodda said there was a good chance there could be more coronavirus cases in reported in the US over the weekend, while Chinese factory data set to be released on Saturday (Australia time) would deliver the first good read on how the outbreak had affected the world’s second-biggest economy.

“It’s going to set up an interesting Monday morning, when trading conditions become a little thin — especially if the news flow delivers a few shockers,” he wrote in a note.

Last Week’s Upheaval In Share Markets Around The World

WE HAVE VOLATILITY AS THE ORDER OF THE DAY

Firstly, it is important to once again stress that when investing in shares the price we pay for a better return than cash based investments is the RISK that capital values will fluctuate (both upwardly and downwardly). Nothing new here.

The last week was a GOOD REMINDER that what can come about (from an unexpected left field) that might affect markets. Who would have thought that before Christmas 2019 the headlines of the day in early 2020 would be:

*World Health Threat
*New Virus spreads around the World
*Pandemic
*Ships Quarantined
*Travel thwarted
*People Isolated

It is a little bit like – one of those things we say like anything can happen and probably will.

Last week there were strong indications that the coronavirus spread outside China is widening.  Hence MARKETS REACT. Again, nothing new there.

None of us know where this will all go and how far reaching. Of course, we would all hope and pray such disease will not be a Spanish Flu in World War 1 times where 50 million people worldwide died. At that time Australia was one of the very few countries not affected due to our geographic location. As we all know this time the whole World is a lot closer with advances in travel etc.

Share markets over 20 to 30 plus years have provided returns of approximately 10% to 12% per annum (income and capital growth). If we want to limit the higher downs in the market (and ups for that matter) then we can do this by diversity of investments, time in the market and regular investing into the market. But any exposure to growth assets will always come with VOLATILITY sometimes which can be extreme.

Looking Back Exactly One Year from Friday 28 February 2020

As we always say NEVER LOOK LESS THAN 1 YEAR and generally take a 7 year plus view in shares.

Keeping things in perspective the Australian Share market (Capital Growth alone, and Combined Dividends and Capital Growth) and US Share Market (S&P 500) over the year ending 29 Feb 2020 has performed as follows including highlighting the recent dip:

The coming weeks will be interesting indeed.

At Plus1 we are available at any time to discuss issues of this nature with due regard to your investments or financial planning generally.

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

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Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 10/03/2020

Market Insights – 24/02/2020

Market Insights

24th Febraury 2020

Top Stocks

CODE PRICE MOVEMENT   CODE PRICE MOVEMENT
CBA $88.80 -2.19%   NAB $27.41 0.37%
BHP $38.22 -0.73%   TLS $3.74 -0.80%
WBC $25.81 0.27%   WES $46.02 1.14%
RIO $97.69 0.14%   CSL $336.40 0.81%
ANZ $27.24 2.29%   WOW $43.45 1.57%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUSTRALIAN DOLLAR IS BUYING

All Ords

7,230.40

-0.34%

 

US Dollar

0.6595

Dow Jones

28,992.41

-0.78%

 

Euro

0.6091

FTSE-100

7,403.92

-0.44%

 

GB

0.5091

Nikkei 

23,386.74

-0.39%

 

Yen

73.4393

Commodities

Oil (WTI)

53.310

-0.58%

Gold

1,630.000

1.46%

Iron Ore

86.150

0.31%

Major Market Announcements

– U.S. stocks sold off and the Nasdaq had its worst daily percentage decline in about three weeks on Friday as a spike in new coronavirus cases and data showing a stall in U.S. business activity in February fueled investors’ fears about economic growth.

– Mayne Pharma says it is repositioning itself into the areas of women’s health and dermatology after posting a $17.5 million half-year loss amid strong competition in the US generic drug market. Mayne’s revenues for the six months to December 31 were down 17 per cent to $227.2 million compared with the same period in 2018.

– British media group ITV Studios is in talks with Seven West Media about buying the in-house production business that makes Home and Away and My Kitchen Rules.

– A triple whammy of bushfires, floods and the coronavirus outbreak will hit takeover target Village Roadshow’s earnings in the second half. The theme park and film production company flagged the impact on Friday as it told investors its Gold Coast theme parks, which include Wet ‘n’ Wild, Sea World and Paradise Country, were doing well and the momentum had continued into January.

But bushfires, a two-day closure due to floods and a drop in international tourists due to the coronavirus outbreak would likely reduce earnings before interest, tax, depreciation and amortisation by $3 million, its said.

– A Queensland coroner is poised to hand down his long-awaited findings from the inquest into the deaths of four people on a ride at Dreamworld more than three years ago.

Cindy Low, Kate Goodchild, her brother Luke Dorsett and his partner Roozi Araghi died in October 2016 when a water pump on the Thunder River Rapids malfunctioned at the theme park.

Confronting evidence emerged during six weeks of evidence in 2019 and Coroner James McDougall will deliver his findings on Monday in the Brisbane Magistrates Court.

Police recommended no criminal charges against Dreamworld staff over the fatal incident, but the coroner could still recommend prosecutions or substantial fines for the company and its executives.

– A multi-billion-dollar Federal Government program to deal with traffic congestion has become the latest scheme at the centre of pork-barrelling accusations. Labor claims the Coalition’s Urban Congestion Fund unfairly benefited the government ahead of last year’s federal poll.

Opposition infrastructure spokeswoman Catherine King said Labor’s analysis of the way the money had been spent showed 83 per cent of the funds went to Government and marginal Labor seats.

Market Update

The Australian share market is expected to decline when it opens this week due to fears coronavirus is spreading across Asia and will increasingly impact global economic activity.

United States and European markets fell on Friday on the back of increasing concerns over COVID-19 as more companies face disruptions and issue profit warnings.

“People are increasingly concerned about the number of cases outside of China particularly in places like Korea and Japan,” AMP Capital chief economist Shane Oliver told AAP.

“There’s a concern that if there are more cases in Asia that will further hit global economic activity.”

The Dow Jones fell 227.6 points or 0.8 per cent at the close on Friday and the S&P 500 declined 1.1 per cent while European shares shed 0.6 per cent.

As a result, futures trading in Australia has declined 47 points or 0.7 per cent.

Dr Oliver expects the local market will open down more than 40 points on Monday after hitting a record high on Thursday despite the global jitters over COVID-19.

Local construction data out on Wednesday for the December quarter will probably show a fall, the economist predicts.

Business investment figures to be released on Thursday are more likely to be mixed but still soft overall. Both sets of figures will be watched closely because they’ll suggest how GDP performed in the December quarter.

Credit data published on Friday could be boosted by the pick-up in housing lending.

Reporting season continues domestically with Rio Tinto and Woolworths among those to reveal their earnings this week.

Dr Oliver says if the results are better than feared it could again help support the Australian market.

The benchmark S&P/ASX 200 index closed 0.3 per cent lower at 7,139 on Friday but recorded its third weekly gain benefiting from company earnings and domestic expectations for monetary stimulus.

Share Watch

Hunting for Income: Consider your options. . 

With interest rates likely to be lower for longer, investors are seeking yield from potentially riskier investments.
Record-low interest rates pose a challenge for income-oriented investors. That challenge is particularly acute for those living off the income from cash investments.

Although, shifting from cash to a different asset class involves much more than just switching to a higher-yielding investment. It’s important to take a whole-of-portfolio view as not all risk is the same.

Your Risk Profile and Asset Allocation is one of the most important factors we consider when deciding on suitable investments for you. Once this has been worked through, we recommend an investment strategy based on your appetite for risk, in doing so, we will endeavour to spread your investments across various sectors in order to best diversify your portfolio. 

The purpose for investing and your timeframe for your investment objectives are also important in determining the best asset mix for you. The below table sheet outlines how investment markets have behaved over the past 30 years.

As can be seen for the above table, shares generally return around 10% (income and growth) on average per year. Constructing a portfolio with a mix of all of the above asset classes, plus sector exposure within each asset class will provide you with a good spread of investments for the longer-term return. 

In life, time can be a great healer for a broken heart. In investments, it can equally work wonders for the health of your portfolio.

Contact our office for a free financial planning consultation.

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 10/03/2020

Market Insights – 17/02/2020

Market Insights

17th Febraury 2020

Top Stocks

CODE

PRICE

MOVEMENT

 

CODE

PRICE

MOVEMENT

CBA

$90.99

7.38%

 

NAB

$27.35

5.84%

BHP

$38.65

0.65%

 

TLS

$3.77

-0.53%

WBC

$25.70

2.76%

 

WES

$45.65

-0.41%

RIO

$97.65

-0.36%

 

CSL

$331.19

2.64%

ANZ

$26.61

2.03%

 

WOW

$43.14

0.33%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUSTRALIAN DOLLAR IS BUYING

All Ords

7,227.10

0.31%

 

US Dollar

0.6719

Dow Jones

29,398.08

-0.09%

 

Euro

0.6195

FTSE-100

7,409.13

-0.58%

 

GB

0.5155

Nikkei 

23,687.59

-0.59%

 

Yen

73.9720

Commodities

Oil (WTI)

52.090

1.42%

Gold

1,578.000

0.59%

Iron Ore

85.140

-0.33%

Major Market Announcements

– The S&P 500 ended modestly higher on Friday following strong earnings from Nvidia and a report late in the session that the White House was considering a tax incentive for Americans to buy stocks.

– Nearly half the applicants using a new Federal Government scheme to purchase a property with a deposit of as little as 5 per cent are planning to buy outside Sydney, Melbourne or Brisbane. The Government today released the latest data on the uptake of its First Home Loan Deposit Scheme, which launched at the beginning of this year.

– New Zealand’s manuka honey is a worldwide hit – now an ASX-listed health and wellness company is hoping its Meluka honey from a 30,000-year-old tea tree plantation in northern NSW can become an iconic Aussie brand.

– BHP says it is ordering a feasibility study of the proposed $16 billion Scarborough gas field off the coast of Western Australia. BHP owns a 25 per cent stake in the massive LNG project, which is being developed by BHP’s joint venture partner Woodside Petroleum. BHP says the feasability study is the third and final phase required to finalise a proposal for a final investment decision. The project is expected to be submitted for the BHP board of directors for a final investment decision around the middle of this year, which first LNG targeted for 2024.

Market Update

A Sizzling Summer for Stocks..

Australian share markets have had a roaring start to 2020, with sizeable gains driven by momentum stocks, especially in IT and healthcare. Yet while companies like CSL are undoubtedly impressive, a closer inspection reveals some troubling nuances to the growth story, calling into question the high expectations imposed by a growth-starved market.

It wasn’t just temperatures that sizzled in Australia through January. The ASX200 was also on fire, starting the year with a 4.98% gain for the month. In fact, temperatures across all of the physical, political, economic and listed company divides in Australia have been rising: CSL keeps hitting record highs in rising markets and outperforming on down days; the direct and indirect impacts of the coronavirus have occupied much attention; and horrific fires lit the eastern seaboard throughout the Australian summer, reinforcing the pace and quantum of changes in the energy mix required because of global warming and its consequences.

The wrinkles in CSL’s billion dollar growth story
CSL has been a stunning performer, and not just through the past year when it has put on 70% – adding $60bn in market capitalisation. It’s been a good company we have been happy to invest in for many years. Our inimitable colleague Mr Conlon heavily invested in CSL when it acquired Aventis Behring in 2003, to the extent that the Schroders Australian equity funds were collectively the second biggest holders of equity in the company. While Aventis Behring was purchased at less than inventory value, the group today trades at almost 50 times inventory value. By vertically and horizontally integrating through that time, the quality of the business has improved materially; but the question remains for investors as to what extent that has increased the value of the group.

CSL is a relatively mature competitor in a mature industry. For example, flu vaccines have been a large part of CSL’s EBIT growth in the past few years. Today they comprise 15% of revenues, in an industry growing at 2.5% in 2019. Although CSL has been winning share, we doubt competitors like GSK and Sanofi will allow this to keep occurring. This, however, is critically important for CSL; its EBIT has grown by US$1bn in the past four years to $2.5bn, which in itself makes the forecasts for a further US$1bn of growth in the next several years appear plausible.

Equities outlook
The bifurcation of stocks by multiple within the ASX continues to be extreme. Most IT stocks trade at more than 40 times earnings, as do most healthcare companies. Globally, IT has been such a strong performer that its share of global market indices is now almost 25% – the same level as in the telecommunications, media, and technology (TMT) bubble days of 1999 and early 2000. Of course, global profits are much higher for IT stocks than they were then, which is not the case with almost all of the big names in Australian IT. It may be that they ultimately grow into it – but, as we detailed in our June 2019 commentary, an investor in Computershare in 1999 took 17 years to get back to the share price they invested at, and in the meantime the company’s profits grew tenfold.

Unashamedly, we currently continue to skew our portfolios towards lower-multiple sectors of the market, where we accept lower earnings growth. This is simply because the risks attached to such investments are usually copious but visible, and not related to valuation, which remains the biggest risk of all.

Share Watch

Is your portfolio heavily weighted in Australian Blue Chip Shares? Which can provide great dividends and franking credits! If you already have this established and are looking to further diversify your portfolio, consider the following Exchange Traded Fund (ETF)

BetaShares Australian EX20 Portfolio Diversifier (ASX: EX20)

EX20 provides a simple, cost-effective way to obtain exposure to a passively-managed diversified portfolio of Australian shares, excluding the largest 20 stocks by market capitalisation.

Advantages;

– A core portfolio holding providing broad market exposure
– Exposure to 174 Australian companies 
– Instant diversity in an Australian Equities portfolio and reduce portfolio concentration to individual securities or market sectors
– Complements and/or alternative to investments with active fund managers  

Contact our team for a personalised review of your portfolio, or to discuss establishing a portfolio. 

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

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Professional Standards Legislation logo
Platinum Xero Partner
MYOB logo
Quickbooks logo

Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 10/03/2020

Market Insights – 10/02/2020

Market Insights

10th Febraury 2020

Top Stocks

CODE PRICE MOVEMENT   CODE PRICE MOVEMENT
CBA $84.80 0.77%   NAB $25.92 2.25%
BHP $38.77 1.95%   TLS $3.79 0.00%
WBC $25.01 0.44%   WES $45.55 1.67%
RIO $98.43 1.82%   CSL $320.03 3.40%
ANZ $26.03 3.09%   WOW $42.72 3.39%

Market and Exchange Rates

MAJOR FOREIGN MARKETS   AUSTRALIAN DOLLAR IS BUYING
All Ords 7,121.40 -0.38%   US Dollar 0.6661
Dow Jones 29,102.51 -0.94%   Euro 0.6084
FTSE-100 7,466.70 -0.51%   GB 0.5166
Nikkei 23,827.98 -0.19%   Yen 73.0590

Commodities

Oil (WTI)

50.260

-1.47%

Gold

1,558.000

0.28%

Iron Ore

80.960

0.85%

Major Market Announcements

– Wall Street fell from record levels on Friday after a four-day rally as investors digested the monthly U.S. jobs report and braced for the next coronavirus developments, but stocks still posted solid gains for the week.

– The Reserve Bank has kept its word and left its growth forecast unchanged through to the end of the year, while continuing to insist the GDP hit from bushfires, drought and coronavirus outbreak will be short-lived.

– Shell has signalled plans to build its first utility-scale solar farm in Australia, part of a global push into the power business and cleaner energy. The oil and gas major on Friday said a 120 megawatt solar farm at Wandoan in Queensland is expected to be completed in early 2021.

– BHP Group is starting to feel the impact of the coronavirus on its business with the mining giant in talks with its Chinese customers to delay shipments of copper concentrate as plants are shutdown around the nation.

– REA Group has recovered from an early share price dive after flagging hopes that a population-driven demand for housing will help it recover from a first-half affected by a building activity and listing downturn. The realestate.com.au owner said on Friday profit from core operations for the six months to December fell by 13 per cent to $152.9 million amid challenging market conditions.

Flight Centre says the coronavirus outbreak will make it difficult to achieve its fiscal 2020 profit guidance. The travel services provider said the virus was affecting its early second-half travel patterns, particularly in Asia. The company had previously pegged its underlying profit before tax forecast for fiscal 2020 at between $310 million to $350 million. Managing director Graham Turner said it was too early to predict the virus’s overall impact.

Market Update

The Australian sharemarket has snapped its three-day winning streak, with broad losses across most sectors despite Wall Street setting new record highs overnight.

The S&P-ASX 200 index finished Friday down 26.6 points, or 0.38 per cent, at 7022.6, while the broader all ordinaries index fell 27.3 points, or 0.38 per cent, to 7121.4.

“Bit of a weak finish to the Australian market, unable to keep going on the midweek rally we had after three straight days of gains,” said CommSec market analyst James Tao.

Energy was the worst-performing sector, falling 1.7 per cent after China’s largest LNG importer declared force majeure on LNG contracts and refused to take delivery on them.

Beach Energy was down 4.0 per cent, Woodside Petroleum fell 1.5 per cent and Santos dropped 1.7 per cent.

The heavyweight mining sector was also down, with BHP falling 2.0 per cent to $38.77, Rio Tinto down 0.7 per cent to $98.43 and Fortescue Metals down 3.3 per cent to $10.85.

Goldminers gained as the price of the precious metal moved over $US1,560 an ounce, with Northern Star up 3.2 per cent, Newcrest gaining 0.5 per cent and Evolution up 0.8 per cent.

Gold Road Resources was the best performing ASX200 component, climbing 9.3 per cent to a five-month high of $1.58.

In the banking sector, Commonwealth Bank was up 0.7 per cent to $84.80, while the other four big banks were lower.

ANZ dropped 0.3 per cent to $26.03, NAB dipped 0.1 per cent to $25.92 and Westpac fell 0.6 per cent to $25.01.

News Corp’s ASX-listed shares gained 3.2 per cent to $21.82 despite a four per cent dip in second-quarter earnings.

Realestate.com.au owner REA Group, of which News Corp owns 62 per cent, gained 3.1 per cent after its half-year earnings slid less than expected given the weak housing market.

Flight Centre fell 2.4 per cent to $39.75 after the online travel operator announced that the coronavirus outbreak was affecting travel patterns, particularly to Asia, making it hard to achieve its fiscal 2020 earnings guidance.

Outdoor retailer Kathmandu jumped 17.6 per cent to a five-year high of $3.54 after announcing same-store sales were up 1.5 per cent in the 26 weeks ended January 26.

Biotron jumped another 25 per cent to 12.5 cents following Thursday’s 22 per cent rise, which came after the small Sydney biotech company announced it was testing the use of its compounds against coronaviruses, including the deadly Wuhan strain.

The Australian dollar meanwhile dipped to a three-day low after the Reserve Bank left growth forecast unchanged through to the end of the year, despite threats from the bushfires, drought and coronavirus outbreak.

The Australian dollar was buying 67.17 US cents, down from 67.59 US cents at the close of the market on Thursday.

Looking forward, earnings season will kick off in earnest next week, with Wednesday and Thursday in particular looking like big days on the reporting calendar.

CBA, CSL, Downer and IAG are among the companies reporting on Wednesday, while AMP, NAB and Telstra report on Thursday.

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.

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Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide

Market Insights – 10/03/2020

Market Insights – 3rd February 2020

Market Insights

3rd Febraury 2020

Top Stocks

CODE

PRICE

MOVEMENT

 

CODE

PRICE

MOVEMENT

CBA

$85.26

1.86%

 

NAB

$25.86

1.13%

BHP

$39.40

1.52%

 

TLS

$3.84

0.52%

WBC

$25.12

0.48%

 

WES

$45.21

0.69%

RIO

$98.77

1.68%

 

CSL

$312.05

-2.18%

ANZ

$25.75

0.59%

 

WOW

$41.84

4.84%

Market and Exchange Rates

MAJOR FOREIGN MARKETS

 

AUSTRALIAN DOLLAR IS BUYING

All Ords

7,121.20

0.18%

 

US Dollar

0.6689

Dow Jones

28,256.03

-2.09%

 

Euro

0.6030

FTSE-100

7,286.01

-1.30%

 

GB

0.5075

Nikkei 

23,205.18

0.99%

 

Yen

72.5515

Commodities

Oil (WTI)

51.550

-2.49%

Gold

1,584.100

0.96%

Iron Ore

92.900

-0.50%

Major Market Announcements

– Wall Street’s major averages tumbled more than 1.5% on Friday, sealing its worst week in six months, as the spreading coronavirus outbreak, coupled with sluggish U.S. economic data and a mixed batch of corporate earnings, fueled concerns about global growth.

– The coronavirus is expected to hit Australian sectors exposed to the Chinese market, including tourism, education and retail, the hardest. Investment bank UBS on Friday published a report exploring the implications of the virus — which has killed 213 people — that estimated a two-month halt on China package tours could cost Australia at least $1 billion in services exports.

– Seven West Media has delayed payment for major flagship program Big Brother as shares in the television network slumped to fresh record lows ahead of its half-year financial results. The return of the hit reality-TV show, which previously aired on Ten, was announced at the company’s annual “Upfronts” event last year. The program will cost between $20 million and $30 million to make, according to production sources, and will launch before the Tokyo 2020 Olympics in winter.

– Australian wine companies and grape growers have called for a $103 million federal government investment to lift exports, increase wine-tourism and protect the economic prospects of an industry hit by drought and bushfires. The local industry has also warned that removing the right of Australia to use the term Prosecco wine, which it says the European Union is pushing for as part of a free trade deal, would have a “devastating” impact and threaten its viability.

– The Murray-Darling Basin’s “cop on the beat” says the impact of floodplain harvesting in northern New South Wales will be “front and centre” as part of his inquiry into interstate water-sharing rules.

Market Update

Australia’s share market is expected to “play follow the leader with the US” markets and open with a dip after Wall Street paused to take profit following a record-breaking start to the year.

The Dow Jones was down 603 points or 2.1 per cent, the S&P 500 fell 58 points or 1.8 per cent and the NASDAQ was down by 148 points or 1.6 per cent at the close on Friday.

“We expect to see declines in the order of that magnitude when the Australian market opens on Monday,” CommSec chief economist Craig James told AAP on Sunday.

“The futures are pointing to a fall of 119 points or 1.7 per cent at the start of trade

“We’re going to play follow the leader with the US,” he said.

Mr James said investors were also watching the coronavirus and its impact across the globe.

“The markets seem to have digested the news fairly well

“I don’t think investors are getting too gloomy

“They still believe the coronavirus and the sort of steps being made around the world are going to make this more of a short term dislocation rather than longer-term,” he said.

Despite this, Mr James said the Chinese travel bans will have a significant short term impact on the Australian economy.

However, he attributed Friday’s falls to a “pause” for profit-taking following a positive start to the year.

“Investors didn’t’ want to get too far ahead of themselves,” he said.

The ASX has held up better than most markets around the world, however.

“One reason may be the lower Aussie dollar may be providing a degree of support of export markets,” he said.

The week ahead kicks off with “super Monday” when data on Australian home prices, building approvals and job adverts will be released.

The Reserve Bank board meets on Tuesday. This will be followed by bank governor Philip Lowe’s speech on Wednesday and the quarterly statement of monetary policy on Friday.

“It’s certainly Reserve Bank-centric over the week,” Mr James said

US employment figures will be released on Friday.

“There is a lot to digest,” he said

Share Watch

Resmed Inc. (ASX: RMD) is a global company involved in the development, manufacturing, distribution and marketing of medical devices and cloud-based software applications that diagnose, treat and manage respiratory disorders including sleep disordered breathing, or SDB, chronic obstructive pulmonary disease, or COPD, neuromuscular disease and other chronic diseases.

ResMed released a very impressive result on the final day of the month, for the three months ended December 31, ResMed reported revenue growth of 13% to US$736.2 million. This took its half year revenue to US1,417.2 million, which was up 14% over the prior corresponding period.

Things were even better further down the income statement thanks to its ever-improving margins. This was thanks primarily to the benefits from product mix changes and manufacturing and procurement efficiencies.

ResMed reported net operating profit growth of 26% to US$197.8 million for the second quarter. For the first half, net operating profit came in 22% higher than the same period last year at US$368.9 million.

What we like about ResMed;

– Return on Equity (ROE) 21.59% (ROE is considered to be a measure of how effectively management is using a company’s assets to create profits.

– Excellent Earnings Per Share (EPS) growth forecast; EPS reflects how much money a company makes for each share of its stock.

The healthcare industry, in general, is growing significantly. One key factor driving this growth is demographic trends of aging populations in many parts of the world. As individuals age, they’re more likely to need healthcare products and services.

If you would like further information please contact us on 03 58 333 000

All Ordinaries (XAO) 5 Day Chart

Disclaimer: The advice provided is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.

Open Hours

Monday to Friday
8:00am to 5:00pm

Closed Public Holidays

Plus 1 Group logo

If you need to get us documents quickly, access remote support, or the MYOB Portal click the button above.

Contact Us

27 Welsford Street
Shepparton, VIC 3630

T: (03) 5833 3000
F: (03) 5831 2988
Email Us

CPA Logo
Professional Standards Legislation logo
Platinum Xero Partner
MYOB logo
Quickbooks logo

Sentinel Wealth Unit Trust T/As Plus 1 Wealth Advisors (ABN:11 408 695 672) is an Authorised Representative of Sentinel Wealth Managers Pty Ltd
(ABN: 73 108 328 294) AFS Licence 322211 | Financial Services Guide