Between the Bells

The ASX200 posted a gain of 0.82% (Monday – Thursday) this week, led by strength for tech, financials, and industrial stocks. Our local market also took strong lead from Wall Street’s Trump rally that saw the S&P500 hit a fresh record.

In this week’s wrap, Grady covers:

• (0:10): tariff announcements in Trump’s first days back in office
• (2:19): why financials & gold stocks rallied this week
• (3:57): the best & worst performing stocks on the ASX200
• (4:59): the most traded stocks & ETFs by Bell Direct clients
• (5:29): economic news items to watch out for.

In the US today on Wednesday the Trump 2.0 fuelled rally extended into the midweek session, sending the S&P500 to a fresh all-time high, up 0.61%, while the Dow Jones rose 0.3% and the Nasdaq ended the day up 1.28%. Strong corporate earnings results are also fuelling the strength in equities with Netflix jumping over 9% after surpassing 300 million paid memberships inQ4, while Procter & Gamble added nearly 2% on earnings topping expectations.

In Europe overnight, markets closed mostly higher on strong corporate earnings results in the region which boosted Germany’s DAX to an all-time high again on Wednesday with a gain of 1.01%. The French CAC rose 0.86%, but, in the UK, the FTSE 100 ended the day down just 0.04%. Sportswear giant Adidas rose 6% on the German index on Wednesday after sales grew by 19% in Q4 results.

Across the Asia region on Wednesday markets closed mixed led by China’s CSI index falling 0.93% as President Trump signalled his plans to impose a 10% tariff on China. Hong Kong’s Hang Seng also fell 1.72% on Wednesday while South Korea’s Kospi index rose 1.15%, and Japan’s Nikkei ended the day up 1.58%.

The local market closed the midweek session 0.33% higher, extending on Tuesday’s gains as 7 of the 11 sectors ended the day higher. Our big miners came under pressure yesterday though after US President Donald Trump said he was considering a 10% tariff on China which Australia is reliant on for key commodity trade.

Technology shares rose on Wednesday after Netflix posted its biggest quarterly subscription gain ever in afterhours trade in the US, fuelling investor hopes for broad growth in the tech sector on an earnings front.

Woodside shares fell almost 2% yesterday after the oil and gas producer released the most recent quarterly results including production falling 3% due to weaker seasonal demand.

Bub’s Australia soared 22.5% on Wednesday after the infant formula producer reported a sharp turnaround in 1H earnings with the company achieving EBITDA of $2.9m following a $6.8m loss in the PCP.

What to watch today:

• Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.35%.
• On the commodities front this morning, oil is trading 0.1% higher at US$75.97/barrel, gold is up 0.48% at US$2757/ounce and iron ore is flat at US$101.21/tonne.
• The Aussie dollar has further strengthened overnight to buy US$0.62, 98.29 Japanese Yen, 50.76 British Pence and NZ$1.11.

Trading Ideas:

• Bell Potter has increased the 12-month price target on Paladin Energy (ASX:PDN) from $10.50 to $10.70 and maintain a buy rating on the uranium producer following the release of a second quarter update including operational gains at its Langer Heinrich Mine in Namibia with production of 640 thousand pounds which beat BPe and C1 costs of US$42.3/pound which fell below BPe which was a welcome result.
• And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU) following the formation of a pattern over a period 85-days which is roughly the same amount of time the share price may rise from the close of $2.83 to the range of $3.25 to $3.35 according to standard principles of technical analysis.

Wall St was closed overnight due to the Martin Luther King Jr public holiday whilst Donald Trump was inaugurated as the 47th president of the United States.

Over in Europe, markets closed slightly higher as investors react to Donald Trump being sworn in as the US president. The STOXX600 closed 0.05% higher with mining stocks leading gains up 1.2%. Germany’s DAX rose by 0.42%, the French CAC jumped 0.31% and over in the UK the FTSE100 climbed 0.18%.

Locally yesterday, the ASX200 rose by 0.45% with most major sectors closing in the green. Gains were led by the information technology and real estate sectors which rose by 1.13% and 0.78% respectively. This was offset by the energy sector which fell by over half a percent by the closing bell.

What to watch today:

• The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.34% at market open this morning.
• On the commodities front this morning,
   
  • Oil is trading 1.83% lower at 76 US dollars and 45 cents a barrel as markets reacted to Donald Trump’s pledge to expand domestic crude production. 
  • Gold is trading 0.18% higher at 2705 US dollars an ounce and iron ore is trading 0.72% higher at 101 US dollars and 21 cents a tonne.

Trading Ideas:

• Bell Potter maintains a buy rating on Genusplus Group (ASX:GNP) and keeps an unchanged 12-month price target of $3.10. The buy rating has been maintained by Bell Potter as GNP has been awarded a new $140m contract by Ausgrid for sub-transmission line works at the Hunter-Central Coast Renewable Energy Zone project. The contract award is material and bolsters GNP’s orderbook in the medium term, hence the buy rating is maintained.
• And Trading Central has identified a bullish signal on Beacon Lighting Group (ASX:BLX), indicating that the share price may rise from the close of $3.05 to the range of $3.60-$3.70, on a pattern formed over 70 days, according to the standard principles of technical analysis.

Wall St closed higher on Friday to post the firstly weekly gain across the three major averages for the year as the big tech rally resumed momentum. The Dow Jones rose 0.78% on Friday and 3.7% for the week, the S&P500 added 1% on Friday and 2.9% for the week, and the Nasdaq ended Friday’s session up 1.51% and added 2.5% for the week. In Europe on Friday the positive investor sentiment extended into the European region buoyed by a strong rally for mining stocks. The STOXX 600 rose 0.68%, Germany’s DAX added 1.35%, the French CAC gained 0.98%, and, in the UK, the FTSE100 ended the day up 1.35%. Across the Asia markets on Friday it was a mixed session as strong economic data in China boosted investor sentiment in the region. China’s CSI index rose 0.31% on Friday after fresh GDP data showed the Chinese economy expanded by 5% YoY and retail sales rose 3.7% which beat expectations. Hong Kong’s Hang Seng rose 0.21% on Friday and Japan’s Nikkei fell 0.31% at the closing bell. Locally on Friday, the ASX200 took lead from Wall Street’s losses overnight to post a 0.2% loss on Friday as the financials weighed on the key index. The pullback followed the ASX200 rising 1.4% on Thursday so for the week the key index still managed a gain of 0.2% last week.

On an economic data front on Friday, we had the highly anticipated retail sales, industrial production, and GDP readings out of China. The Chinese economy expanded 5.4% in Q4 which was above the 5% forecast and above the 4.6% recorded in Q3 which is a welcome sign of material recovery in the region post pandemic. Retail sales further supported the recovery story with a rise of 3.7% in December which beat the 3.2% economists were expecting and is a sharp rise from the 3% reported in November. And Industrial production in the region also rose 6.2% in December on an annual basis which also exceeded expectations and was a sharp rise from the 5.4% reported in November. Overall, the economic growth in China is finally starting to show signs of material turnaround and this boosted the iron ore price and stocks with exposure to the region on Friday.

The winning stocks on the ASX200 on Friday were led by Megaport rallying 10.10%, Liontown Resources rising 9.5% and Lovisa adding 7.73%. And on the losing end REA Group fell 2.71%, TPG Telecom lost 2.4% and JB Hi-Fi ended the day down 2.15%.

Insignia Financial is the talk of the M&A world right now as Bain Capital and CC Capital fight to acquire the nearly 200-year-old Aussie wealth management company. Shares in Insignia rose 6% on Friday after CC Capital increased its takeover offer to a value over $3bn or $4.60/share, above the $4.30/share Bain matched earlier this week. How this one plays out will be very interesting but it’s no wonder why CC and Bain want to acquire Insignia as the purchase will give the acquirer a market leadership position in Australia’s over $4tn superannuation market. And Telix Pharmaceuticals rose 4% on Friday after the cancer imaging and therapy pharmaceuticals company received approval from Europe’s Marketing Authorisation Application for its prostate cancer imaging agent Illucix which already has FDA and TGA approval. This further expansion into Europe broadens the company’s revenue runway for its leading agent Illucix.

What to watch today:

• Ahead of the first trading session of the new trading week the SPI futures are anticipating the ASX will open the new day up 0.34%.
• On the commodities front this Monday morning, oil is trading 1.02% lower at US$77.88/barrel, gold is down 0.5% 2700.99/ounce and iron ore is up 0.72% at US$101.21/tonne.
• The Aussie dollar is buying US$0.61, 96.85 Japanese Yen, 50.88 British Pence and NZ$1.11.

Trading Ideas:

• Bell Potter has reduced the 12-month price target on Lynas Rare Earths (ASX:LYC) from $7.70 to $7.20 and maintain a hold rating on the rare earths producer following the release of a 2nd quar

The ASX200 has seen a modest 0.4% gain (Mon – Thurs), recovering from a chopping start to the week. While early trading was marked by mixed signals, the release of the latest US inflation data added optimism to global markets. 

In this week’s wrap, Grady covers: 

• (0:23): implications of the inflation reading on the Fed’s monetary policy
• (0:52): how Australia’s employment figures impact the economy
• (1:43): key areas of focus for the upcoming earnings season 
• (4:20): the best & worst performers on the ASX200 this week
• (5:12): the most traded stocks by Bell Direct clients 
• (5:39): economic news items to watch out for. 

Wall St closed higher overnight after the latest US inflation report showed that core inflation slowed in December. The Dow Jones rose by 1.65%, the S&P 500 jumped 1.83% and the tech-heavy Nasdaq closed 2.45% higher.

US Core inflation data was released last night and came in unexpectedly lower than the forecast of 0.3% month on month to 0.2% in December.

Over in Europe, markets closed higher following the release of UK and US inflation data. The STOXX600 snapped a 3-day losing streak ending the day 1.3% higher with all major sectors closing in the green. Gains were led by retail stocks which rallied by 2.7%.

Locally yesterday, the ASX200 fell by 0.22% by market close. Losses were led by the information technology and communication services sectors, which fell by 1.25% and 1.21% respectively. This was offset by the consumer discretionary sector which rose by 0.19% by market close.

What to watch today:

• The Australian share market is set to open higher, with the SPI futures suggesting a rise of 1.27% by market open this morning.
• In terms of economic data, Australian unemployment data will be released at 10:30 this morning with a forecast of 3.9%, the same as its previous result.
• On the commodities front this morning,
   
  • Oil is trading 3.83% higher at 80 US dollars and 45 cents a barrel after underlying inflation in the US triggered bets of lower rates by the Fed this year 
  • Gold is trading 0.76% higher at 2695 US dollars an ounce and iron ore is trading 1.29% higher at 99 US dollars and 99 cents a tonne.

Trading Ideas:

• Bell Potter maintains a buy rating on Coronado Global Resources (ASX:CRN) and has a 12-month price target of $1.45. With a current share price of $0.75, this indicates a share price growth of 95% over the next 12-months, hence the buy rating is maintained.
• And Trading Central has identified a bullish signal on Pacific Current Group (ASX:PAC), indicating that the stock price may rise from the close of $11.92 to the range of $12.31-$12.39, on a pattern formed over 13 days, according to the standard principles of technical analysis.

Wall St closed mixed again on Tuesday as investors await key inflation data out in the region on Wednesday US time and following the release of a lighter-than-expected producer price index report. The Dow Jones rose 0.52%, the S&P500 gained 0.11% and the tech-heavy Nasdaq ended the day down 0.23%. The US PPI index which measures wholesale inflation increased just 0.2% in December which was below the 0.4% economists were expecting and indicates inflation is continuing to cool in the US.

In Europe overnight, markets in the region closed mixed with the STOXX 600 falling 0.08% while the UK’s FTSE 100 shed 0.28%, but in Germany the DAX rose 0.7% and in France, the CAC ended the day up 0.2%.

Across the Asia region on Tuesday, markets mostly rose, tracking investor moves in the US out of tech stocks and into other areas of the market. Hong Kong’s Hang Seng rose 1.9% on Tuesday, South Korea’s Kospi Index gained 0.31%, and China’s CSI index added 2.63%, but Japan’s Nikkei was the outlier with a fall of 1.83% yesterday.

The local market rose 0.48% on Tuesday despite global market turbulence on Monday. Rising bond yields and strength in the US economy spooked investors late last week with concerns the Fed will not cut rates again at least in the near-term, but locally, investor optimism has risen early in the week to send the key index higher for the last 2-days.

The energy and materials sectors did most of the heavy lifting yesterday driven by a rally for oil and iron ore prices on favourable outlook on a global scale.

Westpac consumer confidence data out yesterday for January indicated consumer pessimism persists with a decrease of 0.7%, following on from the 2% decrease in December. While the reading is a second decline in consumer sentiment, the level is still above that from a year ago and signals consumers are expecting a gradual improvement in conditions in 2025.

Star Entertainment Group once again led the gains on Tuesday with a gain of 12% at the closing bell despite the embattled casino operator being around 6-weeks away from collapse with just $79m left in the bank. Investors were buying in again yesterday after a mystery Macau businessman continued buying up shares in the stock with another 28m purchased by Xingchun Wang yesterday.

And in the retail space City Chic shares rose over 11% as investors welcomed the plus size fashion retailer’s first half trading update including strong sales over the holiday period, reduced inventory and a return to profitability.

The winning stocks on the ASX200 yesterday were led by Ingenia Communities Group rallying 13.05%, Star Entertainment Group rising 12% and Polynovo adding 6.4%.

And on the losing end Life360 fell 3.3%, West African Resources lost 3.12% and HMC Capital ended the day down 2.45%.

What to watch today:

• Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX will open the day up 0.07%.
• The Aussie dollar has further weakened overnight to buy US$0.61, 97.79 Japanese Yen, 50.79 British Pence and 1 NZ$1.11.
• On the commodities front this morning, oil has retreated 1.42% to trade at US$77.68/barrel, gold is up 0.08% at US$2670/ounce and iron ore is up 0.64% at US$98.72/tonne.

Trading Ideas:

• Bell Potter has maintained a spec buy rating and 12-month price target of $1.30/share on Opthea (ASX:OPT) following the release of Phase 3 trials baseline data being released leading to confidence in the company’s sozinibercept combination therapy in diabetic macular edema as the Phase 3 patient populations are broadly similar to those included in the previous Phase 2b trials. The analyst is also confident with Opthea’s cash runway with $130m in the bank.
• And Trading Central has identified a bearish signal on SkyCity Entertainment (ASX:SKC) following the formation of a pattern over a period of 98-days which is roughly th

Wall St closed mixed to start the new trading as investors shift out of tech stocks and into the industrials sector of the market. The Dow Jones rose 0.86%, the S&P500 gained 0.16% and the tech-heavy Nasdaq ended the day down 0.38%. Rising bond yields also pressured equities at the start of the week as investors shift to the relatively safer returns of bonds over equities when bond yields rise.

In Europe overnight, markets in the region closed lower amid rising bond yields and a soaring USD. The STOXX 600 fell 0.55% on Monday, Germany’s DAX lost 0.41%, the French CAC fell 0.3% and, in the UK, the FTSE100 ended the day down 0.3%.

Across the Asia region on Monday, markets closed lower taking lead from Wall St on Friday and on the back of key economic data being released out of China. China’s imports rose 1% in December, which significantly topped economists’ expectations of a 1.5% decline while exports jumped 10.7% YoY which was also above the 7.3% rise markets were expecting. China’s CSI index fell 0.3% on Monday, Hong Kong’s Hang Seng lost 0.73% and South Korea’s Kospi Index ended the day down 1.04%.

The local market started the new trading week lower, ending the day down 1.2% as negative sentiment on the rate front in the US filtered into our local market on Monday. A stronger-than-expected jobs report out in the US on Friday dampened hopes of rate cuts out of the Fed anytime soon, which sparked the broad sell-off in Australia yesterday.

Department store giant Myer tumbled over 23% yesterday after the retailer released an ‘in-line’ trading update with flat growth amid challenging trading conditions during the high interest rate environment. The update dragged down shares in Premier Investments too by 16% as Premier is the largest shareholder in Myer.

Meanwhile Insignia Financial rallied 2.43% after Bain Capital moved to match its takeover bid to that of CC Capital’s $4.30/share as the race to take over one of Australia’s leading wealth providers heats up.
And Novonix tumbled almost 10% on Monday after the US Department of Energy didn’t permit the battery materials producer access to specific tax credits to make it eligible for an additional loan to fund its Tennessee facility.

What to watch today:

• Ahead of Tuesday’s session on the ASX the SPI futures are anticipating the local market will open the day up 0.45%.
• On the commodities front this morning oil is trading 3% higher at US$78.89/barrel, gold is down almost 1% at US$2660/ounce and iron ore is flat at US$98.09/tonne.
• The Aussie dollar has slightly strengthened overnight against the greenback to buy US$0.61, 96.90 Japanese Yen, 50.64 British Pence and NZ$1.11.

Trading Ideas:

• Bell Potter has increased the 12-month price target on Lynas Rare Earths (ASX:LYC) from $7.50 to $7.70 and maintain a hold rating on the rare earths producer ahead of the release of the company’s 2QFY25 report on 17th January. The analyst is looking for commentary on ramp up and production guidance across the business given weaker than anticipated Rare Earth prices but increases the price target due to their blended forward EV/EBITDA picking up a greater portion of FY26.
• And Trading Central has identified a bullish signal on Ramelius Resources (ASX:RMS) following the formation of a pattern over a period of 22-days which is roughly the same amount of time the share price may rise from the close of $2.18 to the range of $2.46 to $2.52 according to standard principles of technical analysis.

Wall St closed sharply lower on Friday as a hot job report out in the US dampened expectations for further interest rate cuts out of the Fed this year. The Dow Jones fell 1.63%, the S&P500 lost 1.54% and the tech-heavy Nasdaq ended the day down 1.63%. In December US payrolls grew by 256,000 which was well above the 155,000 economists were expecting. While this strong jobs report is good to signal a robust economy, it is not good for market sentiment on the rate cut front as a strong labour market leads to higher income and consumer spending which in-turn drives inflation.

The negative market sentiment flowed into the European region on Friday with markets in Europe also closing the day lower. The STOXX 600 fell 0.83%, Germany’s DAX lost 0.5%, the French CAC slid 0.79% and, in the UK, the FTSE100 ended the day down 0.86%. Eurozone bond yields also rose on Friday which pressured equities in the region.

Across the Asia region on Friday, markets mostly fell as real household spending in Japan declined 0.4% YoY in November while average real household income rose 0.7% in the same period. Japan’s Nikkei fell 1.05%, China’s CSI index lost 1.25%, Hong Kong’s Hang Seng fell 0.95% and South Korea’s Kospi Index ended the day down 0.24%.

Locally on Friday the ASX200 fell 0.42% as all sectors aside from materials stocks ended the day in the red, led by financials stocks declining 1.17%. The miners had a much-needed relief rally following days of depreciation on the back of a rise in the price of iron ore, while the banks took the biggest hit on broker downgrades within the sector. Star Entertainment Group fell a further 15.8% on Friday, extending heavy losses into a third session as investor concerns grow over the future of the embattled casino operator.

Insignia Financial on the other hand rallied over 2% on reports a 3rd bidder, Brookfield, is weighing up a bid for the superannuation and wealth giant.

What to watch today:

• Ahead of the first trading session of the new week the SPI futures are anticipating the ASX will open the day down 0.86% tracking Wall St losses on Friday.
• On the commodities front this morning, oil is trading 3.6% higher at US$76.57/barrel, gold is up 0.6% at US$2685/ounce, and iron ore is flat at US$98.09/tonne.
• The Aussie dollar has further weakened to buy 61.48 US cents, 97.00 Japanese Yen, 50.35 British Pence and 1 New Zealand dollar and 11 cents.

Trading Ideas:

• Bell Potter has downgraded the rating on Avita Medical (ASX:AVH) from a speculative buy to a speculative hold and have reduced the price target on the company from $4.60 to $3.50 after the company updated its guidance for FY24 with Q4 revenue now expected at US$18.4m which is well below the previously issued guidance range of US$22.3m to $24.3m amid a weaker response than expected from the recent launch of Recell Go.
• And Trading Central has identified a bullish signal on JB Hi-Fi (ASX:JBH) following the formation of a pattern over a period of 23-days which is roughly the same amount of time the share price may rise from the close of $96.40 to the range of $101.75 to $103.00 according to standard principles of technical analysis.

Join Grady in the first Weekly Wrap of 2025. The ASX200 advanced 0.95% in the first trading week of the year (Mon – Thurs). Economic data was released this week, which saw inflation cooling, increasing the likelihood of an RBA rate cut in February. However, a strong labour market and persistent inflationary pressures may lead the RBA to hold rates steady.

In this week’s wrap, Grady covers:

• (0:38): what the latest CPI reading means for markets
• (1:42): how retail sales performed over the Black Friday sale period
• (2:25): what to except from the RBA’s next meeting
• (4:05): how the ASX200 performed this week so far
• (4:53): the most traded stocks & ETFs by Bell Direct clients
• (5:20): economic news items to watch out for.