Between the Bells

This morning the futures are suggesting the Aussie share market will rise 0.9%. 

What to watch today: 

• It’s confirmed that Brisbane will host the Olympics in 2032. This means infrastructure will be built over the next 11 years to cater for the Olympic Games. Investors should watch engineering stocks such as Cimic (ASX:CIM) and Downer (ASX:DOW). Also watch construction stocks including Brickworks (ASX:BKW), Adelaide Brighton (ABC) and Boral (ASX:BLD). 
• The oil price jumped 4% overnight, trading above US$70 – and likely to push higher.
• The iron ore price fell 0.5%, copper rose 0.4% and the coal price eased from its decade high, falling 1.3%. 

Trading Ideas: 

• Beach Energy (ASX:BPT) was upgraded by Bell Potter with a new $1.85 price target, implying 52% share price growth in a year. BPT is a BUY stock for Bell Potter, Macquarie and Credit Suisse. 
• James Hardie (ASX:JHX), Redbubble (ASX:RBL) and Coda Minerals (ASX:COD) are all giving off bullish charting signals, according to Trading Central. 

It was a positive session across European and US markets, with all major indices closing with gains. 

The Aussie share market is set to open higher with the futures suggesting a 0.7% rise to 7,210 points. 

What to watch today:

• Keep an eye on Oil Search (ASX:OSH). The company’s share price jumped, after they rejected a takeover bid with Santos (ASX:STO). While OSH’s share price jumped 6.3% yesterday, Santos closed almost 5% lower. 
• Afterpay (ASX:APT) is looking to set up its own Financial Services License. APT announced their Money By Afterpay App rollout plan, which is the company’s new money and lifestyle app. This app is looking to be launched to customers in October. 
• In local COVID-19 news, South Australia has joined NSW and Victoria in lockdown. At 6pm yesterday, Adelaide entered a weeklong lockdown as the delta variant spreads. The NSW Government also announced a weeklong lockdown for parts of the Central West. 
• Retail Sales Data for June will be released today at 11:30am AEST.
• Tonight at around 6:30pm AEST it will be decided if Brisbane is successful in the bid to host the Olympic Games in 2032. 
• The oil price is up 1.3%, following yesterday’s crash, trading at US$67.00. 
• Coal continues to trade higher, while the gold price is trading 0.1% lower.
• Woodside Petroleum (ASX:WPL) was the most traded stock by Bell Direct clients yesterday. The stock was under pressure yesterday, as the oil price also tumbled. 
• Australia and New Zealand Bank (ASX:ANZ) was in the green yesterday and was also one of the most traded, after the bank announced a $1.5 billion buy-back. Its shares closed with a 0.6% gain yesterday at $27.32. 

Trading ideas:

• Bell Potter maintain their BUY recommendation on Senex Energy (ASX:SXY) with a $3.75 price target. Senex provide leverage to Australia’s gas market, where supply deficits are supporting high prices. SXY closed at $3.18 yesterday, implying 17.9% share price growth in a year. 
• Bell Potter also maintain their BUY recommendation on Elders (ASX:ELD) at a $13.75 price target. The stock closed with a 3.2% gain yesterday at $11.68, implying 17.7% share price growth in a year. 
• Bullish charting signals have been identified in Dropsuite (ASX:DSE), Telix Pharmaceuticals (ASX:TLX) and Australian Ethical Investment (ASX:AEF), according to Trading Central.  

It was a volatile session over on Wall Street. The Dow Jones tumbled more than 700 points, that was its largest drop since October last year. This comes as the delta variant is spreading, causing COVID-19 cases in the US to rebound this month.

What to watch today:

• Today, the Aussie share market is set to drop sharply at the open, 1% lower, amid Wall Street retreating, oil collapsing and US Treasury yields sliding. 
• The RBA Meeting Minutes will be released at 11:30am today AEST. Given NSW and Victoria are in lockdown, and the RBA previously flagged it will reduce the amount of bonds it buys from November, many are now expecting the central bank to flip on that decision and increase support again. 
• Today, BHP (ASX:BHP) is set to report its fourth quarter FY21 production numbers and Sydney Airport (ASX:SYD) will release its June 2021 sales.  
• The most traded stocks yesterday by Bell Direct clients, were Evolution Mining (ASX:EVN) which fell nearly 9% yesterday, after several investment houses trimmed their targets to EVN’s share price including Morgan Stanley & Credit Suisse. Also, we saw Bell Direct clients trading energy services group Valmec (ASX:VMX), its shares jumped 25% higher yesterday after the company received an acquisition offer. 
• The oil price fell more than 6% lower, below US $70 a barrel, after OPEC ministers agreed to increase oil supply from August and as the delta COVID-19 variant threatens global demand.
• Coal prices continue to track upwards, trading at almost $150 a tonne. 
• While the iron ore price continues to trade around US$219.

Trading ideas:

• Bell Potter has maintained its BUY recommendation on Australia’s largest accident repair group, AMA Group (ASX:AMA), with a decreased price target of $0.65 (previously $0.70). AMA closed about 1% lower yesterday to $0.52, which implies about 24% share price growth. 
• Bell Potter also maintained its BUY recommendation on Cooper Energy (ASX:COE) with a price target of $0.45. The stock closed about 4% lower yesterday to $0.24, which implies a massive 86% share price growth. 
• Bullish charting signals have been identified in Deterra Royalties (ASX:DRR), Mirvac Group (ASX:MGR) and Mayne Pharma Group (ASX:MYX) according to Trading Central.

Please note: Given the current restrictions in Sydney, we will be delivering our market updates via audio format. We will revert back to the usual video format once restrictions ease. We thank you for your understanding. 

The Aussie share market is set for a negative start to the week. The futures are hinting a 0.5% pull back, following all three US major indices closing lower. 

Watch to watch today: 

• Given the increased restrictions in Melbourne and Sydney, Australia is likely to see economic activity fall in the September quarter by 1.4% from July to September. 
• Sydney’s new restrictions include a pause on all construction, with 250,000 construction workers told they cannot work. Additionally, non- essential retail stores are closed and Sydney’s public transport has been halved with timetables reverting to Sunday schedules. 
• As the construction industry takes a big hit, watch Boral (ASX:BLD), Brickworks (ASX:BKW), CSR Limited (ASX:CSR), and CIMIC (ASX:CIM) and Fletcher Building (ASX:FBU).  
• Energy stocks are expected to make strong rebounds this week, while banking will pull back. 
• Commonwealth Bank (ASX:CBA) are offering loan deferrals and Westpac (ASX:WBC) are offering interest free temporary overdrafts. 
• Brisbane may potentially host 2032 Olympics. The announcement will be made on Wednesday. This will be positive news for infrastructure, engineering, travel and tourism and hospitality stocks. 
• The iron ore price rose 0.5%, copper rose 2.4% and coal prices surged to almost $150.00 a ton, to their highest level in a decade. 

Trading Ideas: 

• Citi has reiterated Afterpay (ASX:APT) as a HOLD with a $125.00 price target. 
• Neometals (ASX:NMT), archTIS (ASX:AR9) and Strike Resources (ASX:SRK) are all giving off bullish charting signals, according to Trading Central. 

Despite lockdowns, Aussie investors have been keeping busy, buying into sectors that will do well on the other side of COVID-19. Plus, local Buy Now Pay Later (BNPL) stocks lost their mojo after the industry got a shake-up.

In this week’s wrap, Jessica covers:

• (0:17) Post-lockdown optimism helps the Utilities sector rise the most
• (0:37) Spark Infrastructure Group (ASX:SKI) lifting 17%, after receiving a fresh vote of confidence
• (1:01) The companies set to benefit as exports to China and the iron ore price surge
• (2:52) The impact of Apple's plan to enter the BNPL industry
• (4:02) An in-depth look at bullish lithium stock: Orocobre (ASX:ORE)

Yesterday growing COVID-19 concerns across the nation weighed down on the market, as well as news that China’s economic growth for the second quarter was slightly below expectations of 8% growth, it rose 7.9%. 

Today, the futures are suggesting the Aussie share market will open 6 points lower. 

What to watch:

• Melbourne entered a sudden 5-day lockdown, while NSW Premier Gladys Berejiklian says she expects todays reported cases to be higher than yesterdays. 
• The unemployment rate fell to 4.9%. This is the lowest unemployment rate in a decade. However, labour force figures in the coming months will be interesting and we can expect some volatility given the data will include the current NSW lockdown. 
• Travel stocks continue to come under pressure. While most of the travel stocks closed in the red yesterday, today we will all be watching Sydney Airport (ASX:SYD)’s share price, after the company formally rejected the takeover offer of $22 billion from a consortium of infrastructure investors.
• Telstra (ASX:TLS) is on watch off the back of competition with Optus in an auction for low- band spectrum coming up in November. Low- band spectrum allows company’s such as Telstra to carry mobile data across greater distances in regional Australia, which is important for Telstra to reach regional communities. 
• The oil price is down 2.4%, the gold price is edging 0.1% higher, while iron ore is currently trading 0.3% higher at US$218. 
• One of the most traded stocks yesterday by both Bell Direct and our advised clients was Westpac (ASX:WBC). WBC was recently downgraded to a HOLD by Bell Potter, with an increased price target of $26.50. After a large jump in impairment benefits, Westpac closed 1.1% lower yesterday, falling the most out of the 4 major banks. 
• Bell Direct clients were also trading Fortescue Metals (ASX:FMG). The past week has seen confidence in iron ore miners, as well as the broader resources sector. Yesterday FMG closed over 2% higher at $25.72, nearing its January all-time record high of $26.40. 

Trading ideas:

• Bell Potter maintain their BUY recommendation on technology company Life360 with an increased price target of $9.25 (previously $7.75). Life360 closed yesterday at $7.83, implying just over 18% share price growth in a year. 
• Bell Potter also maintain their BUY recommendation on Whitehaven Coal (ASX:WHC), with an increased price target of $2.50, with optimism in the current strength in thermal coal markets. WHC closed yesterday at $2.07, implying 21% share price growth in the year. 
• Bullish charting signals have been identified in Magnis Technology (ASX:MNS), Brainchip (ASX:BRN) and Rhythm Biosciences (ASX:RHY), according to Trading Central. 

According to US Federal Reserve Chair, Jerome Powell, inflation “will likely remain elevated in coming months” before “moderating.” 

Apple shares jumped 2.4% after reports that the company had ramped up production of its next-generation iPhones by 20%.

This morning, the futures are suggesting the Aussie share market will dip slightly, about 0.14% or 10 points.

What to watch today:

• Locally, on the COVID-19 front, NSW lockdowns were extended an additional two weeks until Friday the 30th of July. Western Australia impose an immediate border change with Victoria. This requires anyone arriving into WA from Victoria having to self-quarantine for 14 days and be tested on arrival. This comes as Victoria recorded a spike in local COVID-19 cases yesterday. With this in mind, continue to watch travel stocks, such as Flight Centre (ASX:FLT), Qantas (ASX:QAN), Sydney Airport (ASX:SYD) and Webjet (ASX:WEB), which will continue to come under pressure. 
• There are two new threats in the local Buy Now Pay Later market. Firstly, Apple has been working on a new service, dubbed internally as Apple Pay Later, that will allow its users to pay for any Apple Pay purchase in instalments over time. Secondly, PayPal have scrapped its late payment fees altogether, a fee that Afterpay managed to profit $70 million dollars’ worth in 2020. The news weighed down on the local tech sector, which fell 2.7%. Zip (ASX:Z1P) and Afterpay (ASX:APT) were hit the most, both down about 10%. Apple’s entry now casts doubt over Afterpay’s US push, which is believed to be one of its main growth initiatives. So continue to keep an eye on local BNPL stocks today. 
• In economic news, consumer confidence data was released yesterday, and the index gained 1.5%, holding up despite the sharp fall in NSW. This comes as both Victoria and WA recorded strong bounce backs from COVID-19 related disruptions in June. 
• Today, investors will get an update on the unemployment rate. Currently 5.1%, with expectations that this will fall to 5%.  
• The oil price traded lower after reports that Saudi Arabia and the United Arab Emirates had reached a compromise that should unlock an OPEC deal to boost global oil supplies. 
• The gold price rose about 1%. 
• The iron ore price fell about 0.15% from its record high level yesterday. 

Trading ideas:

• Bell Potter has upgraded its recommendation on Nufarm (ASX:NUF) from a HOLD to a BUY with a price target of $5.30. The stock closed up 0.67% to $4.51, which implies about 17% share price growth.  
• Syrah Resources (ASX:SYR), Ecograf (ASX:EGR) and Orocobre (ASX:ORE) are all giving off bullish charting signals according to Trading Central.

The Aussie share market is set to open higher, with the futures suggesting the market will rise 0.06%.

What to watch today: 

• NSW Premier Gladys Berejiklian is expected to announce an extension of Sydney’s lockdown. Yesterday the government announced that small and medium NSW businesses will be eligible for weekly cash payments of up to $10,000. Workers affected will receive $375 to $600 a week. 
• Consumer confidence data for July will released today. This data is expected to be weak as lockdowns continue. 
• The iron ore price rose up 0.4% to US$218, hitting a record all time high. The iron ore price has gained 40% this year, amid surging demand for steel from India.
• Flight Centre’s (ASX:FLT) shares rose 1.7%. That’s its biggest share price jump in seven days. It wasn’t enough to move FLT out of the range it’s been trading in since May – under the $16 mark. Most brokers think FLT will stay around these levels till restrictions ease. 

Trading Ideas: 

• Adacel Technologies (ASX:ADA) was reiterated as a Bell Potter BUY with a $1.25 price target, implying 28% share price growth in a year. 
• Ioneer (ASX:INR), NOVONIX (ASX:NVX) and Carbon Revolution (ASX:CBR) are all giving off bullish charting signals according to Trading Central. 

The Aussie share market is set to rise 0.3%, with bank stocks set to rally following Wall Street. 

What to watch today: 

• Today the Federal Government will be announcing financial support for the NSW lockdown. 
• The iron ore price rose 0.7% overnight to US$217.00. The iron ore price is being supported by an increasing demand for steel globally. Watch iron ore stocks such as BHP (ASX:BHP). 
• In economic news, Business Confidence data for June and Home Sales data will be released today. 
• The most traded stocks by Bell Direct clients yesterday were CSL (ASX:CSL) and Mineral Resources (ASX:MIN). 

Trading Ideas: 

• Citi has a SELL recommendation on Wesfarmers (ASX:WES), with a $45.00 price target. Citi expects WES shares to fall 22%. Meanwhile, Credit Suisse recommends (ASX:WES) as a HOLD stock, downgrading their price target from $58.03 to $57.23. 
• Vulcan Energy Resources (ASX:VUL), 4dMedical (ASX:4DX), and Fisher and Paykel Healthcare (ASX:FPH) are all giving off bullish charting signals, according to Trading Central. 

The Aussie share market is set to rally 1.1% or 76 points. 

Watch to watch today: 

• Traders are cautious as Sydney’s lockdown could possibly be extended until mid-August. Meanwhile, restrictions in Western Australia have ended. 
• The oil price (WTI) rose 2.2% on Friday, to its highest level since 2019. Oil stocks will likely charge up today. 
• The iron ore price fell 0.3% to US$216.00, however it is now back in record territory. In New York on Friday, BHP rose 1.4%, so Aussie iron ore stocks could follow. 
• In economic news, building permits for May are out today, business and consumer confidence data will be released tomorrow and Wednesday, and unemployment figures for June will be released on Thursday. 

Trading Ideas: 

• De Grey Mining (ASX:DEG) is a Bell Potter Speculative BUY stock, with an increased price target to $1.71, implying 36% share price growth in a year. 
• Citi has downgraded its price targets on both Afterpay (ASX:APT) and Zip Co (ASX:Z1P), amid increased global competition. Afterpay’s target has been reduced to $125.00, and Zip Co’s target has been reduced to $10.25. 
• Vmoto (ASX:VMT), Macarthur Minerals (ASX:MIO) and Unibail-Rodamco-Westfield (ASX:URW) are all giving off bullish charting signals according to Trading Central.