Between the Bells

Australian shares closed at a one month high on Friday with gains mostly in the Financial and Technology sectors. 

On Wall Street, the Dow Jones closed at a record for the first time since mid- August, as investors moved out of Tech stocks and into blue chips. The S&P500 edged slightly lower, down 0.1%, while the Nasdaq fell 0.8%, after disappointing earnings reports from Intel and Snap. 

This morning, the SPI futures are suggesting the ASX200 will rise 0.4% at the open, extending last weeks advance. 

What to watch today:

• Companies set to go ex-dividend today include Clover Corporation (ASX:CLV), Jupiter Mines (ASX:JMS) and New Hope Corporation (ASX:NHC). 
• ASX listed buy now pay later stocks – the RBA has reviewed Retail Payments Regulations and have suggested modifying the BNPL providers ‘no-surcharge’ rule. Some BNPL stocks that may be affected include Afterpay (ASX:APT), Zip (ASX:Z1P), and Splitit (ASX:SPT). 
• The oil price is trading 1.5% higher at US$83 a barrel.
• Gold is higher, however trimmed early gains to trade as the US dollar cut losses now that the Fed is ready to begin tapering. 
• Coal is trading 15% below its all-time high and the seaborne iron ore price is trading lower at US$122.  

Trading ideas:

• Bell Potter maintain their BUY rating on Pantoro Limited (ASX:PNR) with an 11% higher price target of $0.30 (previously $0.27), after a strong quarter report. PNR last closed at $0.21, implying 42.9% share price growth in the year. 
• And bullish charting signals have been identified in Frontier Digital Ventures (ASX:FDV), Laybuy Group Holdings (ASX:LBY) and Prescient Therapeutics (ASX:PTX), according to Trading Central. 

The Aussie share market is on track to close higher for the third straight week, supported by gains in both the Financial and Real Estate sectors. 
 
 In this week’s wrap, Sophia covers: 

• (0:58) Why Nickel Mines (ASX:NIC) advanced 11% higher
• (1:54) The impact of Q3 earnings & positive job data in the US
• (3:04) An update on coal plus the Evergrande situation
• (3:45) The most traded stocks by Bell Direct clients
• (4:46) Four economic news items to watch out for 

Watch the weekly wrap here.

Yesterday, the ASX200 gained 38 points or 0.5%, which marked the fourth gain in the last five days. All sectors closed in the green, apart from the Energy and Consumer Staples sectors. 

In the US, the Dow Jones surged to a new all-time high, the S&P500 notched its sixth straight day of gains, while the Nasdaq closed slightly lower. 

Following the decent night on Wall Street, the futures are suggesting the Aussie share market will open 0.16% higher this morning.

What to watch today:

• There are several companies reporting today, they include Alumina (ASX:AWC), Brambles (ASX:BXB), Woodside Petroleum (ASX:WPL), Cimic Group (ASX:CIM), Megaport (ASX:MP1), Mirvac Group (ASX:MGR), and Rhipe (ASX:RHP).
• AGMs today include Wesfarmers (ASX:WES), likely to also provide a trading update at the event, Transurban (ASX:TCL), Crown Resorts (ASX:CWN), APA Group (ASX:APA), as well as Endeavour Group (ASX:EDV), Auckland International Airport (ASX:AIA) and Magellan Financial Group (ASX:MFG).
• The most traded stocks yesterday by Bell Direct clients included BHP (ASX:BHP) which traded slightly higher yesterday after the company managed to outbid Australian billionaire Andrew Forrest’s Wyloo Metals to buy Canadian nickel miner Noront Resources. The company’s chief executive stated that BHP’s offer delivers certainty of value to Noront shareholders via an all-cash offer. Another most traded stock was Whitehaven Coal (ASX:WHC). Its share price tumbled 7.9% yesterday after China’s state planner, the National Development and Reform Commission (NDRC) said that they were looking to clamp down on surging coal prices.
• The oil price continues to trade at 7-year high territory, lifting 1.1% to US$83.89 a barrel. This comes after US crude stockpiles fell and inventories at the nation’s largest storage site hit their lowest level in three years.  The gold price is currently trading 0.7% higher at US$1,781 an ounce. And the sea borne iron ore price is trading slightly higher at US$123 a tonne.

Trading ideas:

• Bell Potter has reiterated its BUY recommendation on oil and gas exploration and production company, Beach Energy (ASX:BPT) with an increased price target of $1.65 (previously $1.62). BPT is currently trading down 20% YTD and yesterday closed 3.7% lower, which implies 14.6% share price growth. 
• Bullish charting signals have been identified in Panoramic Resources (ASX:PAN), Airtasker (ASX:ART) and Bapcor (ASX:BAP), according to Trading Central.

US stocks travelled higher overnight, boosted by stronger than expected earnings. 

This morning, the Aussie share market is set to open higher, with the futures suggesting a rise of 0.7%. 

What to watch today: 

• In company news, Atlas Arteria (ASX:ALX) reported a 9.7% jump in toll revenue in the quarter, as traffic is picking up. 
• Gold stocks to watch include Evolution Mining (ASX:EVN) which reported higher than expected production in the quarter and OZ Minerals (ASX:OZL) which announced copper production is tracking in line with guidance, while it expected gold production to increase. The copper price is also trading at a record all-time high. 
• Flight Centre (ASX:FLT) is set to hold its AGM today. 
• The oil price hit a new 7-year high overnight at US$83, after rising 0.7% overnight and 30% in two months. Watch Australis Oil & Gas (ASX:ATS) and Global Energy Ventures (ASX:GEV). Also watch this week’s best performing energy stocks, including Beach Energy (ASX:BPT) which is up 3.5% and Whitehaven Coal (ASX:WHC) which is up approximately 2%. 

Trading Ideas: 

• The owner of Autobarn, Midas and Burson Autoparts, Bapcor (ASX:BAP) was reiterated as a Citi BUY stock with an increased 12-month target price of $8.75, implying 14% share price growth from yesterday’s close.
• Bullish charting signals have been seen in Imugene (ASX:IMU), Lake Resources (ASX:LKE) and Nearmap (ASX:NEA), according to Trading Central. 

The Aussie share market is set to open higher, with the futures suggesting a fall of 0.3%. 

What to watch today: 

• Stocks exposed to China will be a focus today, as Chinese industrial production and economic growth both slowed more than expected. Australian companies such as commodity giants BHP (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals (ASX:FMG), who export to China, would have noticed less commodity sales. 
• In company news, BHP (ASX:BHP), Northern Star Resources (ASX:NST) and Stockland (ASX:SGP) are set to report quarterly numbers. 
• BHP (ASX:BHP) announced the proposed merger of its Petroleum business with Woodside Petroleum (ASX:WPL) will likely go ahead in November 2021, creating a global top 10 energy company. Most analysts have BHP as a HOLD, except Macquarie who have BHP as a BUY with a 12-month price target of $56. 
• Oil holds its new 7-year high at US$82.29, and the price of platinum has risen 2%. Watch Zimplans (ASX:ZMI), Challice Mining (ASX:CHN) and Podium Minerals (ASX:POD). Palladium is up almost 3%, so you could also watch CHN, Liontown Resources (ASX:LTR) and Impact Minerals (ASX:IPT). 

Trading Ideas: 

• Bell Potter reiterated Temple and Webster (ASX:TPW) as a HOLD with a 12-month price target of $12.75. 
• Bullish charting signals have been identified in Mayne Pharma (ASX:MYX), Centaurus (ASX:CTM) and Emyria (ASX:EMD) according to Trading Central. 

US equities rose on Friday and closed higher for the third straight week. 

This morning, the Aussie share market is set to open higher, with the futures suggesting a rise of 0.4%. 

What to watch today: 

• Stocks that could benefit from the reopening of the economy will be in focus today, as vaccine certificates for international travel will be available from Tuesday ahead of the easing of international travel restrictions. 
• Hard commodities such as metal and energy commodities are in the green, while soft commodities such as cotton, beef, poultry and hogs are lower. 
• The oil price pushed higher to a new 7-year high, trading at US$82.28. 
• Temple and Webster (ASX:TPW) provided an updated EBITDA in the first half of the year, due to a “strong tailwind of ongoing adoption of online shopping”, fuelled by structural shifts from COVID-19. TPW will be investing more into online marketing, with the goal of becoming the largest online retailer for furniture and homewares. TPW is a Bell Potter HOLD stock. 
• In global economic news: 
  • Flash PMI surveys (performance indicators of the services and manufacturing industries) will be released this week for Australia, the US, the UK and the Eurozone. 
  • China’s central bank will decide this week if it will provide economic support. 
  • Also out this week: US housing data, UK retail data, Eurozone consumer confidence, and China’s third quarter GDP. 
  • Australia’s service sector data for October will be released on Friday. 

Trading Ideas: 

• Bell Potter reiterated Eagers Automotive (ASX:APE) as a BUY stock with a price target of $18.75, implying 28% share price growth in a year. 
• Bullish charting signals have been identified in Breaker Resources (ASX:BRB), Rumble Resources (ASX:RTR) and Challenger Exploration (ASX:CEL) according to Trading Central. 

The Aussie share market flatlined on a weekly basis, as unemployment data rocked the boat, meanwhile on the positive side, business confidence and new home sales rose. 
 In Jess' final weekly wrap, she covers: 

• (0:37) Financials hit the most after Aussie economy loses more jobs than expected
• (1:21) Fintech investment platforms stealing the show after reporting record flows
• (3:45) Why there's an increased appetite for infant formula stocks
• (5:57) US third quarter earnings reports ramping up - what to expect
• (6:47) Why next week's Services sector preview will be one to watch

Watch the Weekly Wrap in video here.

Yesterday, the ASX200 posted its first gain for the week as Tech shares rallied. 

In the US, all three benchmarks closed in the green, with the Dow rallying over 500 points, the S&P500 lifting 74 points and the Nasdaq up 250 points. Better-than-expected earnings reports were released from three major banks, as well as Walgreens and UnitedHealth. Also adding to the positive market sentiment was a lower-than-anticipated number of weekly jobless claims. 

Following the broad rally on Wall Street, the recovery in megatechs and the advance of base metals, oil, and gold; the futures are suggesting the Aussie share market will open 0.64% higher this morning.

What to watch today:

• In economic data, yesterday, the unemployment rate worsened from 4.5% to 4.6%. This was better than the 4.7% forecast. A total of 138,000 lost their jobs, while monthly hours worked increased by 15 million hours. 
• Today, keep watch of BHP (ASX:BHP) and Rio Tinto (ASX:RIO)  after its US listed shares jumped in line with commodities. BHP was up 3.9% and RIO gained 3.2%. RIO is also set to release its quarter report today.
• Companies going ex-dividend today include Harvey Norman Holdings (ASX:HVN) and Rhipe (ASX:RHP). While, Treasury Wine Estates (ASX:TWE) and BNPL stock Splitit (ASX:SPT) hold their AGMs today.
• The most traded stocks by Bell Direct clients yesterday, they included Strickland Metals (ASX:STK) which rose over 23% yesterday after the company discovered a high-grade zinc-lead at its Iroquois prospect in WA. Another most traded stock was a2Milk (ASX:A2M) which rose 4% yesterday. The catalyst behind A2M’s rise has been the release of one of its smaller rivals Bubs Australia’s (ASX:BUB) first quarter update.
• The oil price continues to trade at 7-year high territory, lifting 1% to US$81.49 a barrel. This comes after top oil producer Saudi Arabia dismissed calls for additional OPEC supply and the International Energy Agency stated that rising natural gas prices could boost demand for oil. 
• The gold price also traded higher, rising to a one-month high. A dip in the US dollar and bond yields led to investors turning to bullion as an inflation hedge. The uranium price jumped above US$48 a pound, moving closer to its 9-year high hit last month. And the seaborne iron ore price traded slightly higher at $US122 a tonne. 

Trading ideas:

• Bell Potter has initiated coverage on hardware company, Coventry Group (ASX:CYG) with a BUY recommendation on the stock and a $1.90 price target. 
• Bullish charting signals have been identified in Ioneer (ASX:INR), IDT Australia (ASX:IDT) and Hastings Technology Metals (ASX:HAS), according to Trading Central.

The Aussie share market is set to open higher, with the futures suggesting a rise of 0.3%, with a focus on tech and growth stocks as bond yields have slightly fallen. 

What to watch today: 

• In economic news, employment data for September will be released at 11:30am AEDT. The market expects unemployment to worsen from 4.5% to 4.7%, and 100,000 jobs to be lost. 
• The iron ore price has fallen 3.7% to US$124.17 after one of China’s biggest property developers missed a bond coupon payment. Expect BHP (ASX:BHP), Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG) and other iron ore players to lose traction today. 
• Oil holds a 7-year high at US$80.61 a barrel, while the price of lithium carbonate nears its record all time high. And coal is getting closer to its all time high as flooding in China is causing further supply concerns. 
• Soft commodities are rallying including cotton, beef, poultry and hogs. 
• Whitehaven Coal (ASX:WHC) is set to report and Redbubble (ASX:RBL) will provide a trading update today. 

Trading Ideas: 

• Bubs Australia (ASX:BUB) was upgraded by Bell Potter from a HOLD to a BUY, with an increased price target of $0.65, implying 30% share price growth in a year. Meanwhile, Citi has BUB as a HOLD. Bubs Australia (ASX:BUB) shares rose 38% after reporting a 96% jump in revenue year on year, to $19 million. Bubs Infant Formula’s gross revenue increased over 120% year on year. Similarly, Adult Goat Milk Power’s gross revenue grew 100% on the prior year. This is due to China’s sales rising 156% year on year and contributing 53% to quarterly gross revenue. 
• Resolute Mining (ASX:RSG), Calidus Resources (ASX:CAI) and Electro Optic Systems (ASX:EOS) according to Trading Central. 

The Aussie share market is set to rise 0.2% and possibly erase yesterday’s fall of 0.26%. 

What to watch today: 

• The price of coal edged back closer to its record and nickel hit a one month high, while aluminium hit a 13-year high. Stocks to watch include coal companies Whitehaven Coal (ASX:WHC), Coronado (ASX:CRN), and New Hope (ASX:NHC), nickel stocks Western Areas (ASX:WSA), and Nickel Mines (ASX:NIC), and aluminium stocks Alumina (ASX:AWC), South32 (ASX:S32) and Rio Tinto (ASX:RIO). 
• The iron ore price in China fell 4.5% to US$129 and oil set a new 7-year high rising over US$80 a barrel after jumping 1.5%. 
• Commonwealth Bank (ASX:CBA) and Southern Cross Media (ASX:SXL) hold their AGMs today. 
• Gowing Bros (ASX:GOW) goes ex-dividend today and EQUINOX (ASX:EQN) is due to list today. 

Trading Ideas: 

• Bell Potter reiterated their BUY rating on Life360 (ASX:360) with a $10.75 price target, implying 23% share price growth in a year. 
• Citi downgraded Zip (ASX:Z1P) from a BUY to a HOLD on the back of lower customer growth in the US and has decreased its price target to $7.40. 
• Bullish charting signals have been identified in Splitit (ASX:SPT), Damstra (ASX:DTC) and CleanSpace Holdings (ASX:CSX), according to Trading Central.