Between the Bells

Week-to-date the ASX200 is down 0.6% with real estate taking the biggest hit, while utilities remain strong. However, on Friday real estate was the best performing sector, rising 1.5%, while materials and energy suffered from a downturn in commodity prices. 

BNPL company Zip (ASX:ZIP) had good start to the new financial year, rebounding 9%, after the company was the worst performing stock in June, dropping 50% of its value during the month. Meanwhile the decline in commodities saw the major mining stocks and energy producers drop in price. Liontown Resources (ASX:LTR) was down the most, and Woodside Energy (ASX:WDS) and Mineral Resources (ASX:MIN) followed. Fortescue Metals (ASX:FMG), Newcrest Mining (ASX:NCM) and BHP Group (ASX:BHP) also dropped about 3%, while the other miners saw heavier losses. 

The most traded stocks by Bell Direct clients on Friday were Sims (ASX:SGM), Beach Energy (ASX:BPT) and Wesfarmers (ASX:WES). 

US equities rallied, the Dow Jones gained more than 300 points or 1%, the S&P500 also gained 1% and the tech-heavy Nasdaq closed 0.9% higher. 

What to watch today:

• The SPI futures are suggesting our local market will jump 1.5% at the open this morning. 
• The RBA is widely expected to raise rates by 0.5% tomorrow, so investors may be cautious while awaiting tomorrow’s announcement. 
• In commodities, oil and gold are both trading flat, while iron ore has dropped 4%. So watch BHP and FMG today after the pullback in the iron ore price. 
• Watch payment company Block (ASX:SQ2). The New York listed Block share price rebounded from recent selling, so its ASX-listed shares are expected to follow. And the positive trading session for the Nasdaq may see a positive day for the ASX tech sector as well. 
• In economic data, ANZ’s data on job advertisements for June will be released, and home loan data for May will be released, both at 11:30am AEST. 

Trading Ideas:

• Bell Potter have upgraded their rating on Capricorn Metals (ASX:CMM) from a Hold to a Buy and have lowered their price target from $3.90 to $3.70. Bell Potter nominate it as the preferred gold exposure in an environment of rising costs and a rangebound gold price. 
• Trading Central have identified a bullish signal in Qube Holdings (ASX:QUB), indicating that the stock price may rise from the close of $2.83 to the range of $3.10 to $3.16 over 17 days, according to the standard principles of technical analysis. 

The closing bell has rung for the 2022 financial year, and the Aussie share market finished with a loss of 10.2%, the third negative return this past decade. This was in comparison to the impressive 24% return the market delivered during the 2021 financial year.

In this week’s wrap, Sophia covers:

• (0:55) The 2022 financial year wrap: winners & losers
• (2:16) Why Evolution Mining (ASX:EVN) dropped 30% this week
• (2:38) Collins Foods (ASX:CKF) lifts after robust sales growth 
• (2:46) The most traded stocks & ETFs by Bell Direct clients
• (3:26) What to expect from the RBA's upcoming July meeting

Our local market closed lower yesterday, down 0.9%, snapping its four-day winning streak, with the benchmark ASX200 index on track to finish its worst month since March 2020.

Eight of the eleven industry sectors were in the red, with the real estate sector coming under the most pressure, as many property stocks went ex-dividend yesterday. Meanwhile, financials, consumer staples and the energy sector managed to post small gains.

One of the best performers was Star Entertainment Group (ASX:SGR) after the company appointed Robbie Cooke as its new CEO and Managing Director. This comes after Tyro Payments (ASX:TYR) announced that Mr Cooke would be stepping down from his role as CEO and Managing Director at Tyro, after nearly five years of leadership. Star Entertainment Group lifted 3.3%, while Tyro fell 17%. And one of the worst performers was Carsales.com (ASX:CAR), which fell about 10%, after returning from its trading halt. The business has successfully raised $842m from its institutional entitlement offer to help fund its acquisition of US-based online vehicle marketplace called Trader Interactive.

The most traded stocks by Bell Direct clients yesterday were Fortescue Metals (ASX:FMG), ANZ (ASX:ANZ) and Charter Hall Long WALE REIT (ASX:CLW).

In the US, stocks struggled for direction, after heavy falls in the previous session as investors weighed up fresh signs of a looming economic slowdown. So the market closed mixed. The S&P500 and Nasdaq closed slightly lower, while the Dow Jones finished the day up 0.3%.

What to watch today:

• Following the mixed session in the US, our local market is set to open flat if you go by the SPI futures.
• Moving to commodities, oil prices dipped, snapping its three-day winning streak with tight supply worries not enough to outweigh concerns about a weaker global economy. The WTI Crude oil price currently trades at US$109 a barrel. The gold price fell slightly, trading at US$1,818 an ounce, and the spot iron ore price is trading up 2.5% at US124 a tonne.
• Australian industrial company, CSR (ASX:CSR) is holding its AGM today.
• If you hold KMD Brands (ASX:KMD), Kelly Partners Group (ASX:KPG) or Plato Income Maximiser (ASX:PL8), you will receive your dividend payment today.
• There are a number of ETFs going ex-dividend today, including ETF Securities’ FANG ETF, i.e. Facebook, Amazon, Netflix, Google, as well as ETF Securities’ ACDC ETF, which offers investors exposure to the EV megatrend.

Trading Ideas:

• Bell Potter has maintained its Speculative Buy rating on Liontown Resources (ASX:LTR) with a $2.87 price target. LTR has announced a Final Investment Decision (FID) for its flagship hard-rock lithium project in Western Australia, which Bell Potter believes highlights the LTR team’s strong capability in advancing Kathleen Valley in a market experiencing volatility. The company is also in a strong strategic position in a market for lithium facing supply shortages. At its current share price of $1.12, this implies 156% share price growth in a year.
• Trading Central has a bearish signal on Nine Entertainment (ASX:NEC) indicating that the stock price may fall from the close of $1.90 to the range of $1.56 - $1.62 in the next 8 days according to standard principals of technical analysis. 

The benchmark ASX200 index posted its fourth consecutive day of gains, up 0.9% at the close. The strongest sectors were energy, utilities and materials, gaining over 3%, while the consumer discretionary sector declined.

Mining stocks advanced as oil futures rallied higher on reports that the G7 Nations are wanting to lift output, however Saudi Arabia is reluctant. Energy producers including Woodside Energy (ASX:WDS) and Beach Energy (ASX:BPT) were among the best performers, as well as the iron ore majors BHP Group (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals (ASX:FMG). And gold miners were also in the green, recovering from the heavy falls we saw in gold stocks the previous session.

Leading the ASX200 was Collins Foods (ASX:CKF). The KFC merchant released its full year results which saw strong gains in NPAT and sales. CKF closed 11.5% higher.

The most traded stocks by Bell Direct clients yesterday were Link Administration (ASX:LNK), Amcor (ASX:AMC), Commonwealth Bank (ASX:CBA) and Woodside Energy (ASX:WDS).

Overseas, European stocks closed slightly higher, although investor sentiment continues to struggle. Also, consumer confidence in Germany is projected to slide to a new record low in July. In New York, US equities declined with all three major benchmarks closing in the red. The benchmarks were rising earlier in the session, however turned direction after a disappointing consumer confidence index reading that came in below estimates. The Dow Jones closed down 1.6%, the S&P500 down 2%, while the Nasdaq dropped 3%.

What to watch today:

• The local market is set to drop 1.26% at the open this morning, according to the Bloomberg SPI futures. This follows the decline in equities in the US overnight.
• ASX tech stocks took a hit yesterday, and are looking to decline further today, following the Nasdaq’s lead. The Nasdaq moved toward its lowest three-month period since 2008.
• In commodities, oil has rebounded, now trading around US$111 per barrel. Gold is trading lower, while iron ore has rallied on solid demand prospects, amid easing COVID restrictions in China’s major cities.
• Watch Carsales.com (ASX:CAR) as its due to return from a trading halt this morning. The company has raised $1.2 billion at a 14.5% discount to its share price.
• Watch Megaport (ASX:MP1) amid speculation that the company is a potential takeover target.
• There are over 30 stocks going ex-dividend. Remember this often sees shares fall as investors take their profits.

Trading Ideas

• Bell Potter maintain a Speculative Buy rating on 4D Medical (ASX:4DX), a software company commercialising its patented imaging platform. They’ve just signed a 3-year contract with I-MED Radiology Network which is the largest medical imaging provider in Australia. And the contact is for the provision of XV Technology which involves imaging systems for lung functions. Bell Potter raised their price target from $0.63 to $0.65, and at its current share price of $0.46, this implies 41.3% share price growth in a year.
• Trading Central have identified a bullish signal in CSL Limited (ASX:CSL), indicating that the stock price may rise from the close of $274.03 to the range of $292 to $295 over 18 days, according to the standard principles of technical analysis.

Our local market closed started the new trading week and final week of the financial year with a solid gain of 1.9%, supported by a strong rebound in bank stocks. 

All eleven industry sectors posted gains, with the financials, energy, tech, and consumer discretionary sectors all gaining more than 2%. 

Imugene (ASX:IMU) jumped a massive 46% after the company reported positive survival rates amongst advanced gastric cancer patients treated with HER-Vaxx. Also performing well were lithium stocks like Core Lithium (ASX:CXO), Liontown Resources (ASX:LTR), Lake Resources (ASX:LKE) and Allkem (ASX:AKE). While the worst performers yesterday included Evolution Mining (ASX:EVN), Northern Star Resources (ASX:NST) and Ramelius Resources (ASX:RMS).

The most traded stocks by Bell Direct clients yesterday were Sims (ASX:SGM), Woolworths (ASX:WOW) and CSL (ASX:CSL). 

In the US, all three benchmarks started the new trading week in the red, with tech and consumer names coming under pressure, while the energy sector managed to gain 2.8%.   

What to watch today:

• Following the negative session in the US, our local market is set to open slightly lower this morning if you go by the SPI futures.
• KFC owner, Collins Foods (ASX:CKF) is set to release its full year results for 2022 today. No guidance has been given, but the market will be looking for further growth after its positive first-half report.  
• In commodities, oil prices traded higher on the prospect of even tighter supplies, as the Group of Seven nations examine a new package of actions aimed at increasing pressure on Russia over its war in Ukraine. 
• The gold price fell on a weaker dollar as recession fears continue. 
• The nickel price took a hit, dropping 6.8% and the spot iron price is trading lower at US$116 a tonne.  
• If you hold Champion Iron (ASX:CIA) or GQG Partners (ASX:GQG), you will receive your dividend payment today.
• Bindi Metals will be debuting on the ASX today. It will be trading under the ticker code BIM.

Trading Ideas:

• Citi have upgraded its rating on Iluka Resources (ASX:ILU) from a Sell to a Buy and have maintained its price target at $10.25. The upgrade is due to its share price correction and Citi’s view that China’s property starts are now near their low. At its current share price of $9.25, this implies 13.5% share price growth in a year.
• Trading Central has a bullish signal on Aristocrat Leisure (ASX:ALL) indicating that the stock price may rise from the close of $34.80 to the range of $39.75 - $40.75 in the next 43 days according to standard principals of technical analysis.  

Week-to-date the ASX200 rebounded 1.6% and gained 0.8% on Friday. Lithium shares such as Allkem (ASX:AKE), Liontown Resources (ASX:LTR) and Pilbara Minerals (ASX:PLS) all gained, as well as Vulcan Energy (ASX:VUL) after announcing its brought on board Stellantis, the European automotive manufacturing giant, as its second largest shareholder. And tech stocks made strong gains on Friday. It was the best performing sector, up 6%, with family app Life360 (ASX:360) and BNPL company Zip (ASX:ZIP) leading the ASX200, up 22% and 25% respectively. The tech rally followed the jump in US tech shares the previous session. 

The most traded stock by Bell Direct clients was Lake Resources (ASX:LKE), which rebounded 15% on Friday, after falling 55% Monday to Thursday, following the departure of the company’s CEO. Lake Resources was the worst performing stock of the week, down 49% Monday to Friday. Also highly traded on Friday was Chalice Mining (ASX:CHN), Westpac (ASX:WBC), Amcor (ASX:AMC) and BHP Group (ASX:BHP). 

European stocks had their best session in over three months and US equities also made a strong comeback. All three major US benchmarks rallied. The Dow Jones added more than 800 points, up 2.7%, the S&P500 closed 3% higher at the close, and the tech-heavy Nasdaq also rallied 3% higher.

What to watch today:

• The Australian share market is looking optimistic following the positive session in New York. The SPI futures are suggesting a lift of 1.6% at the open this morning. 
• In commodities, oil has dropped further, now trading around US$106 a barrel with expectations of a slowdown in demand and the production shutdown in Libya, making it more difficult for OPEC to meet the production targets. Meanwhile the price of gold is higher, while iron ore is in the red. 
• Metcash (ASX:MTS) is set to report its earnings today.

Trading Ideas: 

• Bell Potter maintain their Buy rating on Nufarm (ASX:NUF) and have lowered their price target from $7.85 to $6.65. There has been a material rerating in global crop protection and domestic peer trading multiples in recent weeks, and Nufarm hasn’t been immune to the sell off, however Bell Potter continue to see the stock as better placed to navigate a normalisation in Australian crop conditions than its peers. At its current share price of $4.99, the price target implies 33% share price growth in a year.
• Trading Central have identified a bullish signal in Woolworths Group (ASX:WOW), indicating that the stock price may rise from the close of $35.46 to the range of $37.60 to $38.10 over 23 days according to the standard principles of technical analysis. 

The Aussie share market managed to gain 0.8% this week (Mon-Thu), regaining some of the heavy losses experienced last week. This comes despite US recession concerns continuing to weigh down on global markets. 
 
 In this week’s wrap, Sophia covers:

• (2:30) A stock to consider given the current energy crisis
• (3:21) PointsBet (ASX:PBH) gains after landing $94m investment
• (3:54) Why Lake Resources (ASX:LKE) fell a hefty 55%
• (5:02) The most traded stocks & ETFs by Bell Direct clients
• (5:18) Three economic news items to watch out for

Our local market closed slightly lower yesterday, down 0.2% or 15 points to 6,508, despite the rebound we saw over on Wall Street. 

The market was mixed. The utilities sector pushed 2.1% higher, supported by gains in APA Group (ASX:APA). Energy stocks also rallied, like Woodside Energy (ASX:WDS), Beach Energy (ASX:BPT) and Santos (ASX:STO). Meanwhile tech and consumer discretionary stocks led the losses came under pressure. 

The best performing stock was Coronado Global Resources (ASX:CRN), which managed to add 7.5% - despite its slump on Tuesday, after the Queensland government announced that there would be increased royalties on coal sales. Also performing well was Ampol (ASX:ALD) following Morgan Stanley retaining its overweight rating and lifting its price target to $39. On the flip side, the worst performers included St Barbara (ASX:SBM), Core Lithium (ASX:CXO) and Lake Resources (ASX:LKE), all down over 13%. Also, Crown Resorts (ASX:CWN) announced news that it had received regulatory approval to start its gaming operations at the Crown Sydney casino, but as the stock is no longer listed on the Aussie market as of last week, following its approval to be taking over by US firm Blackstone, the market couldn’t react.

The most traded stocks by Bell Direct clients yesterday was Stanmore Resources (ASX:SMR), Lake Resources (ASX:LKE), Amcor (ASX:AMC) and Seven West Media (ASX:SWM).

In the US, all three benchmarks closed slightly lower, in a choppy session as markets struggled to sustain a rebound from earlier in the day. 

What to watch today:

• If you go by the SPI futures, our local market is set to open 0.36% higher. 
• Economic news wise, S&P Global Manufacturing and Services Flash PMI for June will be released. This is a forward-looking estimate of the Purchasing Manager’s Index, exemplifying economic trends in the manufacturing and services sectors.
• In commodities:
  • Oil prices came under pressure as investors worry that rate hikes by the US Fed could push the US economy into a recession, therefore dampening demand for fuel. 
  • The gold price pushed higher given these renewed fears of a recession – therefore boosting the safe-haven’s appeal. 
  • The spot iron ore price is currently trading at US$117 a tonne, that’s down 20% from its previous highs in early June. So keep watch of iron ore miners like BHP Group (ASX:BHP) and Fortescue Metals (ASX:FMG). 
• Leo Lithium will be debuting on the ASX today. It will be trading under the ticker code LLL.

Trading Ideas:

• Citi have maintained its Buy rating on BHP Group (ASX:BHP) with a price target of $50. At BHP’s current share price of $41.03, this implies 22% share price growth in a year. 
• Trading Central has a bearish signal on Aurizon Holdings (ASX:AZJ) indicating that the stock price may fall from the close of $3.75 to the range of $3.33 - $3.41 in the next 28 days according to standard principals of technical analysis.  

After what was a seven-day losing streak, Australian shares closed 1.4% in the green yesterday, with a rally in mining and energy stocks. Energy and financials were the best performing industry sectors. The 4 major banks all gained over 2%. 

The top performing stocks were PointsBet Holdings (ASX:PBH) and Paladin Energy (ASX:PDN), while the worst performer was Lake Resources (ASX:LKE). The lithium developer was added to the ASX200 on Monday and was performing very well, up 185% the past year. Yesterday however, LKE crashed 28%, after the surprising announcement that the company’s CEO and Managing Director, has left the company and the former CEO made no comments. 

Bell Direct clients were selling LKE yesterday. Lake Resources was the most traded stock. Clients were also trading ANZ, Core Lithium (ASX:CXO) and Whitehaven Coal (ASX:WHC). 

US equities made a comeback overnight, with all three major benchmarks closing with gains. This follows the US markets worst weekly loss in 2 years, as investors assessed aggressive policy tightening by the Federal Reserve and rising chances of a recession. The Dow Jones gained more than 600 points or 2.15%, and the S&P500 and the Nasdaq each gained 2.5%. 

What to watch today:

• Following New York, the Australian market is set to open higher today. The SPI futures are suggesting the local market will rise 0.75% at the open this morning. 
• In commodities, the price of oil is trading flat. Persistent concerns about tight oil supply continue to outweigh fears of an economic slowdown. The gold price is under pressure amid elevated Treasury yields and a strong US dollar. And iron ore tumbled to around US$115 a tonne, its lowest level since last December. This fall comes due to persistent COVID outbreaks in China, as well as global rate hikes, raise concerns about demand. 
• Fisher & Paykel Healthcare (ASX:FPH) is set to go ex-dividend. 
• Odette Six Metals (ASX:OD6) will list on the ASX today. 

Trading Ideas:

• Bell Potter maintain a Speculative Buy rating on PointsBet Holdings (ASX:PBH). The corporate bookmaker yesterday announced the placement of 38.75 million shares at an issue price of $2.43 per share to SIG Sports Investments, who will become the largest shareholder in the company, and the placement will raise $94.2 million for PointsBet. The company also announced they’ve entered an agreement with a company called Nellie Analytics, to provide sports analytics and quantitative modelling services. Bell Potter have lowered their valuation from $6 to $5.25. At PBH’s current share price of $2.78, this implies 88.8% share price growth in a year. 
• Trading Central have identified a bullish signal in Nearmap (ASX:NEA). Indicating that the stock price may rise from the close of $1.03, to the range of $1.26 to $1.32 over 15 days, according to the standard principles of technical analysis. 

Our local market started the new trading week in the red, extending its losses from last week, to close down 41 points, or 0.6% to 6,433. That marks seven straight days of losses for our market. 

The biggest laggard on the market was the energy sector, which declined 5.2%, after oil prices dropped on Friday on worries that interest rate hikes by major central banks could cut energy demand. While the major banks closed in positive territory, outperforming the broader share market.

The best performing stock was Pointsbet (ASX:PBH) after the betting company secured a $94 million investment from SIG Sports. That makes the US investment firm PBH’s largest shareholder. Also performing well was Pinnacle Investment Management (ASX:PNI) and bio-tech company, Imugene (ASX:IMU), both up more than 7%. Meanwhile, the worst performing stocks included lithium producers like Lake Resources (ASX:LKE), uranium miner, Paladin Energy (ASX:PDN) and coal miners like New Hope Corporation (ASX:NHC) and Whitehaven Coal (ASX:WHC).

The most traded stocks by Bell Direct clients yesterday included Lake Resources (ASX:LKE), BHP Group (ASX:BHP) and Fortescue Metals (ASX:FMG). 

The US market was closed for the Juneteenth Federal holiday, so let’s look across the sea at how European markets performed. The FTSE index lifted 1.5% as financials and energy rebounded. The German Dax closed 1.1% higher and the French CAC jumped 0.6%. 

What to watch today:

• If you go by the SPI futures, our local market is set for a positive day. The futures are up 0.7% or 45 points. 
• Economic news wise, at 8am AEST, the RBA will be releasing to the media their review of the yield target. Following this, at 10am, Governor Phillip Lowe, will speak about inflation and monetary policy at an event in Sydney and finally, the RBA will also release the minutes from its June meeting at 11:30am. These are all important, as they may give us a sense on how aggressive the RBA will be on raising rates as well as what could happen in the next few months
• In commodities:
  • Oil prices edged lower on Monday, amid concerns about slowing global economic growth. 
  • Gold extended its losses as a rise in the US dollar weighed on bullion demand, with the US market holiday expected to lead to thin trading during the day. 
  • The spot iron ore price is trading down at US$125 a tonne. 
• Peter Alexander owner, Premier Investments (ASX:PMV) and chartered accounting company Kelly Partners Group (ASX:KPG) are set to go ex-dividend today. 
• If you hold Virgin Money UK (ASX:VUK), Coronado Global Resources (ASX:CRN) or Oceania Healthcare (ASX:OCA), you will receive your dividend payment today. 

Trading Ideas:

• Bell Potter have maintained its Buy rating on software company, Altium (ASX:ALU), however with a reduced price target, from $41.25 to $34. At its current share price of $25.49, this implies about 33% share price growth in a year.
• Trading Central has a bearish signal on Origin Energy (ASX:ORG) indicating that the stock price may fall from the close of $5.45 to the range of $3.60 - $4 in the next 98 days according to standard principals of technical analysis.