Between the Bells

This week, investors have been weighing up localised lockdowns and travel bubbles reopening, which put travel and tourism stocks back in the spotlight.

In this week’s wrap, Jessica covers: 

• (0:15) Industrials in a league of their own, up 4.5%
• (0:28) Sydney Airport (ASX:SYD) flies up 34%, after receiving a $22 billion takeover offer. What could move SYD next?
• (1:47) Pfizer vaccine imports set to triple, and investors in travel stocks love it
• (2:57) Earnings forecasts are being upgraded & why this is good news
• (4:30) Two travel stocks to consider: Qantas (ASX:QAN) & Flight Centre (ASX:FLT)

It was a volatile session over in the US, amid global economic recovery concerns. 

Japan declared a state of emergency in Tokyo, with its upcoming Olympics to be held with no spectators.

Also causing recovery concerns is the rebound in cases due to the COVID-19 variants many countries are currently experiencing. 

This morning the Aussie share market looks set to end the week lower, with the futures suggesting the market will fall 0.66% at the open. 

What to watch today:

• Zip (ASX:Z1P) saw its share rise as much as 15% yesterday amid speculation that rival Swedish BNPL provider, Klarna had acquired a 4% stake in the business. 
• Seven West Group (ASX:SWM) climbed 4% higher after it took its stake in building materials company Boral (ASX:BLD).  
• RBA Governor Lowe spoke yesterday to the Economic Society of Australia, where he reiterated the central bank’s position that conditions for a rate rise will not be met until 2024. 
• NSW COVID-19 cases hit a record 38 new cases yesterday, with the Federal Government pledging an extra 300,000 doses of vaccines to be distributed to NSW, noting that this won’t affect supplies for other states. Australia now sits at about 8% fully vaccinated, and 25.72% of the population having their first dose. 
• The oil price is trading up about 1.5% to US$73 a barrel, following positive US inventory data, which showed a much bigger drop than expected in crude and gasoline inventories. 
• The gold price eased around US$1,800. 
• The iron ore price fell 0.82% to US$216.

Trading ideas:

• Bell Potter has maintained its BUY rating on telemedicine company Doctor Care Anywhere (ASX:DOC) with a price target of $1.70. DOC closed 2% higher yesterday to $0.90, which implies about 93% share price growth in a year. 
• Lynas Rare Earths (ASX:LYC), BUBS Australia (ASX:BUB) and MyDeal.com.au (ASX:MYD) are all giving off bullish charting signals according to Trading Central.

The Aussie share market is set to open higher, with the futures suggesting a modest lift of 0.2% or 11 points. 

What to watch today: 

• The NSW Treasury estimates that Sydney’s three week lockdown will cost the NSW economy $2.5 billion, with hospitality hit the hardest. Long term investors could take advantage of stocks pulling back as a result. Watch Endeavour Group (ASX:EDV). 
• The RBA Governor will give a speech on the labour market and interest rates today at 12:30pm AEST. 
• The oil price (WTI) briefly hit a new six year high before pulling back to US$72.00. 
• The iron ore price rose 0.2% to US$214.00. 

Trading Ideas: 

• Speciality chemical business DGL Group (ASX:DGL) was reiterated as a Bell Potter BUY with an increased price target of $1.65, implying 18% share price growth in a year. DGL was listed this year on the ASX. 
• Medadviser (ASX:MDR), Ingenia (ASX:INA) and Altium (ASX:ALU) are all giving off bullish charting signals according to Trading Central. 

Yesterday, the RBA held the cash rate at 0.1%, where it is likely to stay until 2024. After the announcement, the Aussie share market continued to fall until the close, ending 53 points lower.

Today, the Aussie share market is set to open flat. The futures are suggesting a fall of 11 points or 0.2%, down to 7,162 points. 

What to watch today:

• Sydney Airport (ASX:SYD) has seen a lot of movement this week. On Monday, SYD’s share price jumped almost 34% after they announced an all cash $22.6 billion buy out offer from infrastructure investors.
• Mineral Resources (ASX:MIN) announced they will be drilling its own natural gas supply in Perth. The project aims to provide energy security for the company’s future mining operations at a lower cost. Yesterday MIN closed 0.4% higher. 
• NSW Premier Gladys Berejiklian is set to extend the current lockdown, originally set to end this Friday. 
• The oil price is trading 1.9% lower, gold is trading 0.2% higher and the iron ore price is trading 2.4% higher. 
• The most traded stocks by Bell Direct clients were Woodside Petroleum (ASX:WPL), Brainchip (ASX:BRN), and Australia and New Zealand Bank (ASX:ANZ). 

Trading ideas:

• Bell Potter have upgraded their recommendation on Uniti Group (ASX:UWL) from a HOLD to a BUY, with an increased price target of $3.60 (previously $3.20).
• Citi have a BUY recommendation on Ramsay Heath Care (ASX:RHC) with a $76 price target.
• Bullish charting signals have been identified in Cyprium Metals (ASX:CYM), Dropsuite (ASX:DSE) and CleanSpace Holdings (ASX:CSX) according to Trading Central. 

The Aussie share market is set to rise 0.3% or 19 points, ahead of the RBA meeting today. 

What to watch today: 

• The RBA meeting minutes will be a huge focus today, given the lockdowns across the nation. The RBA previously committed to buying $200 billion of bonds, in the aim of keeping corporate interest rates low and supporting borrowing by businesses. Investors will be watching whether the RBA reduces buying bonds, as this will increase interest rates for companies borrowing. 
• Tech stocks could see selling pressure today. Watch Afterpay (ASX:APT), Zip Co (ASX:Z1P), Appen (ASX:APX) and Altium (ASX:ALU). 
• Banking stocks will be in the spotlight today and could see profit taking this week, amid the RBA’s announcement. 
• The Australian Banking Association (ASX:ABA) today announced an independent review of the Banking Code of Practice, aiming to ensure banks meet consumer and community expectations. 
• The oil price jumped to US$76.00, its highest in almost 3 years. This is due to a gas leak that caused a fire in the Gulf of Mexico, as well as the cancellation of a meeting with OPEC and other oil producers. 
• The copper price rose 1.6%. 

Trading Ideas: 

• Ardent Leisure (ASX:ALG) was reiterated as a Citi BUY stock, with a $1.30 price target, implying 33% share price growth in the year. 
• Inoeer (ASX:INR), Scentre Group (ASX:SCG) and Strike Energy (ASX:STX) are all giving off bullish charting signals according to Trading Central. 

The Aussie share market is set to start the week flat. 

As COVID-19 cases in NSW increase, many are questioning if Sydney’s two week lockdown will be extended on Friday. 

What to watch today: 

• The Trans -Tasman bubble will resume today. Residents from South Australia, ACT, Tasmania and Victoria will be allowed to travel to New Zealand, provided they have not visited a designated hotspot. 
• In company news, Tabcorp (ASX:TAH) announced it is to demerge its Lotteries and Keno into an ASX listed business. The gambling industry has been successful amid the rise of lockdown leisure, which supports (ASX:TAH) shares. (ASX:TAH) shares are up 33% this year. Other gambling companies to watch include Aristocrat Leisure (ASX:ALL) and Jumbo Interactive (ASX:JIN). 
• In economic news, the RBA are set to meet tomorrow. 
• On Thursday, the US Fed are set to release their last meeting minutes. 
• The iron ore price rose 0.3% to US$212.00. On Wall Street, BHP (ASX:BHP) and Rio Tinto (ASX:RIO) traded higher. The Aussie listed stocks are expected to follow. 
• The gold price rose 0.3% to US$1,787. 
• The oil price traded at US$75.00, at its highest level since October 2018. 
• The copper price rose 1%. 

Trading Ideas: 

• Imdex (ASX:IMD) was reiterated as a Bell Potter BUY with a $2.35 target, implying 18% yearly upside. 
• Transurban (ASX:TCR), Syrah Resources (ASX:SYR) and Musgrave Minerals (ASX:MGV) are all giving off bullish charting signals according to Trading Central. 

Step aside EOFY volatility, August reporting season is just around the corner, and it's looking like it's going to be a showstopper. Plus there's a new tech darling in town, and it's got the attention of some big celebrity names...

In this week’s wrap, Jessica covers:

• (0:22) Telcos stealing the show up 2.3% following Telstra's (ASX:TLS) announcement
• (1:02) Staples back in vogue: Metcash (ASX:MTS) reporting record sales
• (1:57) EOFY rebalancing pushing two stocks to the top of the leaderboard
• (2:37) Why Collins Foods (ASX:CKF) fell 13% despite record earnings
• (3:52) A new celebrity stock? The rise of Life360 (ASX:360)

The Aussie share market is set to rebound, with the futures suggesting a 0.4% lift to 7,205 points. 

US equities had a positive run, with all three major benchmarks closing higher. 

What to watch today:

• Zip (ASX:Z1P) announced their partnership with fintech company Propell Holdings (ASX:PHL), making the company the first BNPL service on the Propell platform. Yesterday Zip’s share price rose 1.7% and Propell’s share price jumped just over 42%. 
• Increases in superannuation payments came into effect yesterday, bumping up from 9.5 to 10%. This sees an additional $233 in super accounts for 6.7 million Aussies. 
• New home loan data will be released at 11:30am AEST. 
• Keep an eye on travel stocks as Sydney, Perth, Brisbane and Darwin are in lockdown and state borders have also been closing.
• The oil price rose 2.1% and is trading at US$75 a barrel. The gold price is up 0.4%, copper is down 1.1% and the iron ore price is trading 1.3% lower.
• CSL Limited (ASX:CSL) was one of the most traded stocks by our advised clients yesterday. The conflicting news headlines regarding health precautions for young people taking the AstraZeneca vaccine have correlated to CSL’s fall.
• Bell Direct clients were also trading Australia and New Zealand Bank (ASX:ANZ), Nuix (ASX:NXL), and BetMakers Technology (ASX:BET). 

Trading ideas:

• Bell Potter maintain their BUY recommendation on The a2 Milk Company (ASX:A2M) and maintain their $8.50 price target, with confidence in the company’s long-term potential in their distribution points in China. 
• Bell Potter also maintain their SELL recommendation on infection prevention company Nanosonics (ASX:NAN), due to likely downgrades from its $130 million consensus revenue for FY22. 
• Bullish charting signals have been seen for Fenix Resources (ASX:FEX), Red River Resources (ASX:RVR) and Humm Group (ASX:HUM), according to Trading Central. 

The Aussie share market closed out its best financial year in over 30 years on Wednesday, with shares rebounding despite a negative start to the week’s trading.

This morning, the Aussie share market looks set to start the New Financial Year slightly lower, with the futures suggesting the market will open down 0.08%. 

What to watch today:

• In economic news, Australia’s Balance of Trade data for May will be released today at 11:30am AEST.
• On the COVID-19 front, the Prime Minister has extended no-fault indemnity insurance to GPs who administer the AstraZeneca vaccine to younger age groups. So far, 26% of Australians have received their first dose. With only 3.47% fully vaccinated.
• The oil price rose on Wednesday, trading at about US$73.55 a barrel, after data showed US crude stockpiles were shrinking and an OPEC report foresaw an undersupplied market this year. 
• The gold price rose 0.45%, still on track for its worst month in more than 4 years. 
• The iron ore price continues to trade at US$214.00.

Trading ideas:

• Bell Potter has a BUY rating on location-based information technology company Life360 (ASX:360), increasing its price target by 11% to $7.75 (previously $7.00). That’s a 15% premium to the share price. 
• Bell Potter also has a BUY rating on technology-based translation services business Straker Translations (ASX:STG), with a price target of $2.40. STG closed about 2% down yesterday, which implies 24% share price growth.
• Prospect Resources (ASX:PSC), Musgrave Minerals (ASX:MGV) and Clinuvel Pharmaceuticals (ASX:CUV) are all giving off bullish charting signals according to Trading Central.

US equities reached a new record high yesterday. 

US American house prices grew 14.9% in April, beating expectations. 

This morning the Aussie share market is set to open higher, for the final day of the financial year. 

What to watch today: 

• Across Australia, capital cities are in lockdown and states are closing their borders, contributing to the markets pull back form its record high. As panic buying takes off again, Woolworths (ASX:WOW) shares are up 4% and Metcash (ASX:MTS) shares are up 6%. As COVID-19 testing increases, healthcare stocks are also doing well, including Sonic Healthcare (ASX:SHL) which is up 3%. 
• Today marks the final day of the Financial Year. During this time, investors often take profits from stocks doing well, and buy underperforming stocks. With this in mind, Redbubble (ASX:RBL) and Kogan (ASX:KGN) are down 30% this year, however both shares rose 5% this week to date. Other stocks to consider include: Zip (ASX:Z1P) and Collins Food (ASX:CKF). 
• NSW small businesses will be able to apply for grants for lost revenue as a result of lockdowns. Commercial businesses are also being encouraged to negotiate rent prices. 
• A ban on exporting mixed plastics will come into play tomorrow. Watch Amcor (ASX:AMC) and Pact Group (ASX:PGH). 
• The iron ore price fell 0.4% to US$214.00, gold fell 0.1% to US$1,761.00, nearing an 11 week low, and the oil price is back over US$73.00. 

Trading Ideas: 

• Alpha HPA Ltd (ASX:A4N), was reiterated as a Bell Potter Speculative BUY with an increased $0.83 target, implying 63% yearly upside.
• FYI Resources (ASX:FYI), Chimeric Therapeutics (ASX:CHM), and Advanced Human Imaging (ASX:AHI) are all giving off bullish charting signals according to Trading Central.