Markets at a glance 26 August

Around the grounds

It’s green on screen for the Australian share market to start the week as miners lead broad-based gains and positive momentum continues from FOMC Chair Jerome Powell’s Jackson Hole speech on Friday, where he all but confirmed an interest rate cut in September.

Rate-sensitive financials are also on the rise, with the ‘Big Four’ up between 0.5% and 0.8%, while the miners are getting a leg up from gains in underlying commodity prices. Chinese iron ore futures on the Dalian Commodity Exchange are up, while energy stocks have jumped over 1% on rising oil prices.  

Looking ahead, Australian investors are watching and waiting for key inflation figures released on Wednesday, and a deluge of corporate earnings.

The Australian dollar meantime is up a tick against the US dollar to start the week.

In the news

Pilbara Minerals (ASX: PLS) has reported an 86% drop in annual underlying profit after tax as lower average realised sales price for lithium took a bit out of the bottom line. It comes as the price of the key metal for manufacturing electric vehicle batteries tumbles on the back of oversupply from China and a softening of electric vehicle (EV) adoption rates.

The average price for lithium fell 74% in fiscal 2024, taking the price down to $1,176 per tonne.

Australian listed shares of Endeavour Group (ASX: EDV) have sunk after the Hotel business company’s NPAT slips over 3% in FY24 on the back of an increase in finance costs. Sales though were higher, with a final dividend of 7.5 cents per share, in line with last year’s payout.

The stock is up over 6% YTD, as of last close.

And shares of Australian listed Bendigo and Adelaide Bank (ASX: BEN) have tumbled as the regional lender posts a 2.6$ fall in fiscal 2024 cash earnings as its consumer division saw heightened competition. The stock is up 28.2% this year, as of last close.

On the flip side, Shares of Kogan.com (ASX: KGN) have jumped after the online retailer swung back to black in fiscal 2024 reporting adjusted net profit of AU$21 million, compared with a AU$4.3 million loss the previous year.

Revenue was also higher, with a final dividend of 15 cents per share declared. The stock is down around 17% this year as of last close.

Shares of Ramelius Resources (ASX: RMS) have touched a four-year high as the gold miner reports a 250% surge in full year net profit after tax, on a 40% jump in revenue from ordinary activities, underpinned by a record gold price.

Stock is up 24% YTD, as of last close with a final dividend of 5 cents per share declared, higher than the 2-cent payout last year.

It’s a similar story for shares of Aussie Broadband (ASX: ABB), marching higher by over 12% to hit a six-week high as the company posts a near 22% surge in FY24 net profit on a near 27% rise in revenue. The company has also proposed an inaugural dividend of 4 cents per ordinary share.

The stock is down 20% YTD, as of last close.  

Looking ahead, Woolworths (ASX: WOW) and Coles (ASX: COL) are expected show a challenging outlook for the supermarkets when they release earnings, as consumers deal with high mortgage rates and sticky inflation.

Going global

Rounding it out on the global stage, Tokyo’s Nikkei 225 has started the week on the back foot as a stronger yen weighed on sentiment. The Japanese currency has rallied to a three-week high against the greenback after FOMC Chair Jerome Powell’s speech at Jackson Hole on Friday where he flagged ‘the time has come’ for the US central bank to start its rate cutting cycle.

The big dollar is languishing at 13-month lows against the euro and has sagged to 2022 lows against sterling.

Looking ahead, traders unanimously expect the Fed will kick off its rate cutting cycle on September 18, with odds of a super-sized 50-basis point cut sitting around 36.5%, according to the CME’s FedWatch Tool.

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