Markets at a glance 14 January
Around the grounds
It’s rally on for the S&P/ASX200 as the local share market looks set to snap a three-day losing streak as miners and energy companies give the bourse a boost. Iron ore prices surged overnight to climb above a two-week high, supporting the heavy weight mining index, revised on hopes of more stimulus from top buy China.
Energy stocks have also extended yesterday’s gains as the price of oil tracks higher on expectations wider U.S. sanctions on Russian oil would force buyers in India and China to seek other suppliers. Financials are also higher as investors eagerly await local employment data later in the week for further clues on the Reserve Bank of Australia’s policy stance.
The gold plays however are bucking the broader trend, snapping five sessions of gains to fall around 0.5% as the price of bullion slips.
In the news
Let’s get to some of the company news in today’s trade. Australian listed shares of Premier Investments (ASX: PMV) are again in the doldrums as the brokers swoop in flagging cost concerns for the Australian retailer, sending shares tumbling to a fresh one-year low.
Citi saying the company’s dismal half-year trading update was due to higher-than-expected costs of doing business, the broker has trimmed the price target to AU$30 from AU$36 a share, with a ‘neutral’ rating retained.
Morgan Stanley meantime is warning of an earnings downgrade driven by lower gross margins to stimulate demand and lack of growth in Smiggle. Target cut to AU$37.50 from AU$39.50, ‘overweight’ rating retained.
The stock is down around 13.5% so far this year.
Meantime, Mesoblast (ASX: MSB) shares have slumped coming out of a trading halt after the as the company completes a private placement to raise AU$260 million. The AU$2.50 per share issue price represents an 11% discount to the stock’s last close.
MSB shares are down over 15% YTD, including today’s move.
On the flip side, shares of Star Entertainment Group (ASX: SGR) are having a blockbuster session, up as much as 14% after a major shareholder based in Macau further increased voting power in the company to 6.52% from 5.52%. The stock has recovered from falling to a record low on Friday but is still down over 34% as of last close.
Elsewhere, shares of CAR Group (ASX: CAR) have jumped to touch a one-month peak as the online vehicle marketplace provider confirms it will exit its Australian Tyres business, following what it called difficulty in achieving sustainable profitability in a ‘highly competitive’ tyre retail and wholesale market.
The stock is up nearly 8% YTD, including today’s move.
Finally, to the smaller end of town and Australian listed shares of City Chic Collective (ASX: CCX) have soared as much as 25% as the company says global sales revenue jumped over 3% in the 26 weeks ending December 29, compared with a year earlier. The stock is up 12.2% this year, including today’s moves.
Going global
Rounding things out on the global stage, it’s a down day for Tokyo’s Nikkei 225, as investors ditch semiconductor-sector stocks after the U.S. government said it would further restrict artificial intelligence (AI) chip and technology exports. The index is headed for a fourth session of losses, down around 4% since January 7th.
U.S. futures meantime are steady as they come back online ahead of the Wall Street session while lofty ten-year Treasury yields continue to underpin the dollar and traders await tomorrows’ inflation print.
Investor nerves though remain high after a bumper payrolls report at the end of last week sent yields surging and decreased the market odds of multiple rate cuts from the FOMC this year. Traders are also worried whether inflation could pick up as a result of incoming President Trump’s policies on tariffs, migration and taxes.
Elsewhere in forex markets, the greenback continues to hover near two-year highs, while the euro remains steady and the Yen has inched away from the near six-month low it touched last week.
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