Between the Bells

The Oil price hit a 7-week high this week supporting the market, however Friday's losses in early trading confirms we're still on shaky ground. Plus, Uranium stocks are in the spotlight as Australia is set to build nuclear powered submarines.

In this week’s wrap, Jessica covers: 
- (0:33) Energy stocks charging as the Oil price jumps 5%
- (1:37) Why the market is bracing for further volatility this month
- (2:51) Pilbara Minerals (ASX:PLS) hitting an all-time high after selling lithium at a record price
- (4:19) Four Uranium stocks to watch
- (6:06) Four of the most traded stocks this week
- (6:47) Economic announcements to be across next week

Yesterday, the ASX200 lifted 0.6% despite mixed employment figures. The unemployment rate fell to a 12-year low of 4.5% in August, from 4.6% in July. The drop is believed to be attributed to the participation rate falling 2.4% as Australians gave up looking for work during lockdown and therefore weren’t counted as unemployed.

In the US, the market was mixed. We saw the Dow Jones & S&P500 down about 0.2%, while the Nasdaq was able to gain 0.1%. US investors digested mixed economic readings released on Thursday. August retail sales exceeded the market’s expectations and rose 0.7% from the month prior. Meanwhile, first-time jobless claims last week came in at 332,000, which was higher than the forecasted 320,000.

Following a mixed session overnight in the US, the Aussie share market is set to fall 0.24% if you go by the futures.

What to watch today:

• Australia’s new partnership with the US and UK will continue to be in focus today as countries and individuals voice their opinion on this strategic alliance. And the uranium price is now trading at a 9-year high, after lifting 8% to US$48.55. In the last month, the uranium price has lifted a huge 60% and yesterday, some ASX uranium stocks made big gains, including Deep Yellow (ASX:DYL), up 8% and 92 Energy, up nearly 9%.
• Companies going ex-dividend today include Carsales.com (ASX:CAR) and National Tyre & Wheel (ASX:NTD).
• The most traded stocks by Bell Direct clients yesterday, included Fortescue Metals (ASX:FMG). Its share price continued to come under pressure, falling 3.2% yesterday, as Chinese steel cuts speed up. Local lithium player, Ioneer (ASX:INR) was another highly traded stock at Bell Direct. INR shares fell 18% yesterday after the company announced a new joint venture with a multinational precious metal miner Sibanye Stillwater, with INR raising additional funds at a 70% higher price than when it undertook a capital raising via a placement in March. This further supports how red hot the lithium market is.
• The oil price remained steady after hitting that 7-week high yesterday. This comes as the threat to US Gulf crude production from Hurricane Nicholas receded. The gold price fell 2.2% driven by a rise in the US dollar, while the iron ore price continued to plunge, falling 3.4% to about US$120 a tonne. 

Trading ideas:

• Bell Potter has maintained its BUY recommendation on death care servicer Propel Funeral Partners (ASX:PFP) and has increased its price target by 9% to $4.65 (previously $4.25). PFP fell about 1% yesterday to $4.05, which implies about 15% share price growth. 
• Bullish charting signals have been identified in Elixir Energy (ASX:EXR), James Hardie Industries (ASX:JHX) and Technology Metals Australia (ASX:TMT) according to Trading Central.

US stocks rebounded from prior losses, with energy stocks leading the gains after the oil price increased 3%. US stocks are 1.3% away from an all-time high. 

Investors are bracing for further volatility, as it is the end of the quarter and options expire on September 17. 

The Aussie share market is set to open higher, with the futures suggesting the market will rally 0.4%, and the focus on employment data ahead. 

What to watch today: 

• Unemployment data for August will be released today at 11:30am AEST. Unemployment is expected to grow from 4.6% to 4.9%. If the data is weaker, expect selling pressure. Watch banking and consumer spending stocks. 
• Uranium stocks are in focus today. The US President, the Australian Prime Minister, and the UK Prime Minister, announced a new partnership with Australia, to build nuclear powered submarines. Historically, this is the first partnership of its nature. Prime Minister Scott Morrison said that the three nations will work together over the next 18 months, to determine the best path forward, to get the wheels into motion, and examine “nuclear stewardship responsibilities” in Australia. Therefore, uranium stocks to watch include Paladin (ASX:PDN), Deep Yellow (ASX:DYL), 92E Energy (ASX:92E), Devex Resources (ASX:DEV) and Energy Resources of Australia (ASX:ERA). Also watch ship builder Austal (ASX:ASB). 
• Watch the lithium sector, after Australian produced lithium from Pilbara Minerals (ASX:PLS) was sold at a record amount. 
• Oil stocks are in focus, as oil is trading at a 7-week high at US$72.65. Meanwhile, iron ore fell again, down 3% to US$122, after China’s construction investment fell 3.2% from January to August, and China’s steel output fell to a 17-month low in August after tightening property restrictions. 
• Companies going ex-dividend today include Sky City, (ASX:SKC) and Spark NZ (ASX:SPK). 
• The most traded stocks by Bell Direct clients yesterday included Metalhawk (ASX:MHK). MHK shares rose 13% and the day prior its shares rose 264%. Metalhawk is a gold and nickel explorer in Western Australia. Sayona Mining (ASX:SYA) was also a highly traded stock yesterday. SYA shares rose 13% as the lithium sector remains under the spotlight. 

Trading Ideas: 

• South32 (ASX:S32) was upgraded as a Citi BUY, with an increased target from $3.50 to $3.80, implying 13% share price growth in a year. 
• Bullish charting signals have been seen in Pilbara Minerals (ASX:PLS), Perseus Mining (ASX:PRU) and Challenger Exploration (ASX:CEL) according to Trading Central. 

Overnight, the three major US indices closed lower. 

Following Wall Street, the futures are suggesting the Aussie share market will fall 0.6% this morning, as investors adjust their portfolios ahead of the end of the quarter. 

The Aussie share market is approximately 3% off a record high, with the market falling twice over the last 18 months. In September, companies go ex-dividend and investors sell stocks after collecting dividends. 

What to watch today: 

• At the end of the quarter, investors take profits from well performing stocks. Tech stocks are down the most this week, however the tech sector is one of the best performers this quarter. On the other hand, investors top-up on stocks that underperformed. Energy stocks this week are the best performers, up 5.7%, however energy is one of the worst performers this quarter. 
• The lithium sector is in the spotlight as Pilbara Minerals (ASX:PLS) sold spodumene lithium at a record price. 
• The oil price rose 0.4% to US$70.73, the gold price is steady above US$1,805, while the iron ore price fell again, down 1.5% to US$124. Some analysts believe the iron ore price will bottom at US$115. Additionally, the coal price is at a record high, and Goldman Sachs increased its price target for thermal and metallurgical coal. 
• In economic news, yesterday business confidence improved, and today consumer confidence data will be released at 10:30am AEST. In addition, yesterday the RBA Governor said that the official cash rate won’t increase until 2024. However, corporate interest rates will rise after the RBA stop bond buying in February next year. 
• Companies going ex-dividend today include: CIMIC (ASX:CIM), Costa Group Holdings (ASX:CGC), and Lovisa (ASX:LOV). 

Trading Ideas: 

• Agriculture and real estate business Elders Ltd (ASX:ELD) was reiterated as a Bell Potter BUY rating with a $13.75 target, implying 18% share price growth in a year. 
• Bullish charting signals have been identified in Origin Energy (ASX:ORG), Pure Hydrogen (ASX:PH2) and Fletcher Building (ASX:FBU), according to Trading Central. 

In overseas markets, European markets closed in the green after a week of losses, due to a strong economic recovery in the euro zone. US equities overnight closed mixed. 

Yesterday the ASX200 recovered late, rising 0.25% at the close. Mining stocks pushed the market higher. The energy sector also benefited from the rising oil prices due to Hurricane Ida. And the four major banks closed mixed.

Today, following US equities, the SPI futures are suggesting the ASX200 will open 0.2% lower. 

What to watch today:

• In economic news, Business Confidence data for August will be released today at 11:30am AEST. Business confidence fell to negative 8 points in July from 11 points in June. Forecasts expect August data to fall to negative 13, dragged down by lockdowns, in particular NSW currently. Additionally, the RBA Governor Phillip Lowe will give a speech at 1pm on Delta, the economy and monetary policy.  
• Sydney Airport (ASX:SYD) following the company receiving a third takeover proposal from a consortium of IFM Investors. The offer is higher than the previous two SYD recently rejected, offering $8.75 cash per SYD share. The offer values Sydney Airport at $23.6 billion, and SYD closed 4.6% higher yesterday. 
• Companies going ex-dividend today include: Absolute Equity (ASX:AEG), Breville (ASX:BRG), Glennon Small Companies (ASX:GC1), Newscorp (ASX:NWS), Inghams Group (ASX:ING), and PSC Insurance Group (ASX:PSI). 
• The most traded stocks by Bell Direct clients yesterday included BHP (ASX:BHP), iShares S&P 500 ETF (ASX:IVV) and Computershare (ASX:CPU). 
• The price of oil is trading 1.4% higher at US$70.68 a barrel. The gold price rose 0.3%, while copper fell over 2%. And iron ore is trading 2.6% lower at US$129.66 a tonne. 

Trading ideas:

• Citi has a BUY rating on Ardent Leisure (ASX:ALG) with a $1.80 price target. ALG own and operate a leisure portfolio of over 100 assets across the US, Australia and NZ, such as Dream World and White-Water World. Citi’s expected share price return is 13.9%. ALG closed more than 5% lower yesterday.
• Bullish charting signals have been identified in Incitec Pivot (ASX:IPL), American Pacific Borates (ASX:ABR) and PropTech Group (ASX:PTG), according to Trading Central.

The major US indices closed lower on Friday and today, the futures are suggesting that the Aussie market will follow Wall Street and fall 0.4%. 

What to watch today:

• The focus will be on travel and tourism stocks as the QLD and NSW border reopens.
• Monash Uni and CSIRO have developed a battery that can allow electric buses and trucks to travel from Melbourne to Sydney without recharging. The duo also said the innovation could be ready in a decade and also work in agricultural drones – with lithium batteries needing to be light weight. So keep an eye on lithium majors like Orocobre (ASX:ORE), Pilbara Minerals (ASX:PLS) and small cap stocks like Lake Resources (ASX:LKE) & Vulcan Energy Resources (ASX:VUL). 
• The oil price rebounded 2% and rose 0.5% on the week.  
• The nickel price hit a fresh 7-year high and gold went the other way, and fell below US$1,800 as the safe haven USD rose .
• The iron ore price fell again, losing 0.5% to US$133 a tonne – getting very close to where some analysts think the iron ore price will bottom at US$115 before slowly rebounding.
• Companies going ex-div today include: HUB24 (ASX:HUB), Healius (ASX:HLS), Chorus (ASX:CNU).  
• Economic news this week includes business confidence on Tuesday, consumer confidence on Wednesday and employment data on Thursday.

Trading ideas:

• Bell Potter put out a banking note this morning reiterating BUY ratings for three of the big banks, calling CBA, ANZ and NAB a BUY, while WBC is a HOLD. 
• Bell Potter maintained S2 Resources (ASX:S2R) as a Speculative BUY stock with $0.18 target, implying 84% share price growth in a year. 
• Bullish charting signals have been identified in archTIS (ASX:AR9), Mach7 Technologies (ASX:M7T), and Viva Leisure (ASX:VVA), according to Trading Central

Historically the most negative month for both global and Aussie equities, this September was no different. The market pulled back 2% this week (Mon-Thu) with all sectors in the red.

In this week’s wrap, Jessica covers: 

• (0:32) What's behind the plunging iron ore price
• (1:49) Technology One (ASX:TNE) rising 9% after being upgraded by analysts as a 'BUY'
• (4:13) Why it's worth exercising caution with UK exposed stocks
• (4:57) Three outlier stocks that rose over 20% after delivering on strategy
• (6:01) Four stocks Bell Direct customers are watching closely
• (6:48) Why all eyes will be on banks and travel & tourism stocks

Watch the Weekly Wrap in video here.

Wall Street extended its losses overnight, with all three major indices closing in the red. The S&P500 down 0.5%, the Dow Jones down 0.4% and the tech heavy Nasdaq down 0.3%. 

Yesterday the ASX200 closed 1.9% lower, with equity sell offs across the market, after the NSW Government announced a roadmap out of lockdown.

Today, despite US equities falling, the SPI futures are suggesting the ASX200 will open 0.3% higher. 

What to watch today:

• Consumer Inflation Expectations for September will be released this morning at 11am AEST. Inflation expectations deceased from 3.7% in July, to 3.3% in August. Forecasts expect it to fall to 3.2%. 
• Companies going ex-dividend today include: Argo Global (ASX:ALI), Ariadne Australia (ASX:ARA), Base Resources (ASX:BSE), Cleanaway Waste Management (ASX:CWY), Sequoia Financial (ASX:SEQ) and WiseTech (ASC:WTC). 
• The most traded stocks by Bell Direct clients yesterday included ANZ (ASX:ANZ), Flight Centre (ASX:FLT) and Fortescue Metals (ASX:FMG). 
• The oil price has fallen 2.2% and is trading at US$67.80 a barrel, pressured by China’s decision to release crude oil reserves to the market, to lower domestic prices, stabilising domestic supply and demand. 
• Copper is trading 0.5% lower and the iron ore price has fallen 1.3% and is trading at US$133.80 a tonne.  

Trading ideas:

• Bell Potter maintain their BUY rating on Envirosuite (ASX:EVS), and have removed their Speculative rating. Bell Potter also increased their price target on EVS to $0.20, after the company’s positive development of a proof-of-concept contract they entered last week with Western Australia’s Water Corporation.  
• Bullish charting signals have been identified in Viva Leisure (ASX:VVA), Pengana Private Equity Trust (ASX:PE1: and Omni Bridgeway (ASX:OBL), according to Trading Central. 

On Wall Street, both the Dow Jones and S&P500 closed lower for the third straight session. The Nasdaq also fell 0.6% as tech shares like Facebook, Apple, Netflix, and Alphabet, all closed lower. 

US investors will be watching the latest weekly jobless claims data, set to be released Thursday morning, which will give a greater look at the employment picture. 

Following a negative session overnight in the US, the Aussie share market is set to follow suite, with a fall of 0.47% if you go by the futures.

What to watch today:

• In economic news, the ABS will publish its weekly payroll jobs and wages data for the fortnight to August 14, and RBA Deputy Governor, Guy Debelle will deliver an online address tonight at the Asian Securities Industry & Financial Markets Association Compliance Week conference.
• On the COVID-19 front, another half a million Pfizer vaccines have left the UK bound for Australia as part of a vaccine swap, set to arrive in less than one week since the deal was announced last Friday. The federal cabinet also discussed last night the changes required to lift Australia’s overseas travel ban as early as November, which should be announced in the next few days. Keep an eye on travel stocks like Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Webjet (ASX:WEB).
• Companies going ex-dividend today include Auswide (ASX:ABA), Monadelphous (ASX:MND), Nine Entertainment (ASX:NEC), Pro Medicus (ASX:PME), South32 (ASX:S32) and Vita Group (ASX:VTG).  
• The most traded stocks by Bell Direct clients yesterday included Fortescue Metals (ASX:FMG), Zip (ASX:Z1P) and Flight Centre (ASX:FLT). 
• The oil price climbed about 1%, following slow US output after Hurricane Ida. Producers in the Gulf are still struggling to restart operations nine days after Ida swept through the region. 
• The gold price dipped to a two-week low as the dollar extended its gains, while the iron ore price continued to plunge, falling another 2.5% to US$135.56 a tonne.
• Uranium continues to trade at an 8 year high, lifting 3.5% to US$40.

Trading ideas:

• Bell Potter has maintained its BUY recommendation on leading beauty and wellness company BWX (ASX:BWX) and has increased its price target by 7% to $6.10 (previously $5.70). BWX fell about 1% yesterday to $4.85, which implies about 26% share price growth. 
• Bullish charting signals have been identified in Cobalt Blue (ASX:COB), Medlab Clinical (ASX:MDC) and K-TIG (ASX:KTG), according to Trading Central.

Wall Street returned from its public holiday long weekend, with US stocks beginning the week mostly in the red. 

The Aussie share market is set to open lower, with the futures suggesting a fall of 0.4%. 

What to watch today: 

• Australia’s vaccine passports will rollout from next month, as proof of vaccination status overseas. Upon return from travel, Australians will be allowed to home quarantine. Keep an eye on travel and tourism stocks such as Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Webjet (ASX:WEB). 
• The aluminium price eased from its decade high, falling 0.2%. Watch Alumina (ASX:AWC), South32 (ASX:S32) and Rio Tinto (ASX:RIO). 
• The iron ore price fell 4% to US$138.83. However, the technical indicators are suggesting that iron ore has been oversold. Although further selling pressure is expected in the short term, the technical indicators and the long term fundamentals, suggest iron ore could hit the bottom soon. 
• The copper price fell 1.3%, while the oil price fell to a two week low at US$68.40, as Saudi Aramco cut its selling price by $1, on the back of new lockdowns across Asia. 
• Companies going ex-dividend today include Adairs (ASX:ADH), Medibank (ASX:MPL) and Seek (ASX:SEK). 
• One of the most traded stocks by Bell Direct clients yesterday was Mineral Resources (ASX:MIN), which fell approximately 4%. Yesterday MIN announced it sold all its major holdings in lithium stock Pilbara Minerals (ASX:PLS). MIN also has several Western Australia mining operations in iron ore and lithium. Bell Potter recommends MIN as a BUY with a price target of $54.70.
• In economic news, yesterday the RBA kept interest rates at 0.1% and extended its bond buying program. The RBA is set to buy $4 billion of bonds in a program ending 11th November. This program has now been extended until mid-February 2022. This means tech stocks will be attractive. This quarter, tech stocks have increased almost 10%. In addition, the RBA believes the Australian economy will bounce back by the second half of 2022 and catch up most of the lockdown losses. 

Trading Ideas: 

• TechnologyOne (ASX:TNE) was upgraded as a BUY stock by Bell Potter, increasing its price target by 28% to $12.50, implying 17% share price growth in a year. 
• Bullish charting signals have been identified in Challice Mining (ASX:CHN), Jervois Global (ASX:JRV) and Elixir Energy (ASX:EXR), according to Trading Central.