Christmas has come early for the bank’s shareholders with the decision to slightly increase the 2024 dividend – despite a single-digit decline in the net profit and cash earnings.
Beating the market benchmark is never easy, with 72 per cent of Australian actively managed global equity general funds trailing the S&P World Index in the six months to June 30, 2024. Domestic equity funds performed slightly better, albeit against a significantly lower bar set by the S&P/ASX 200 Index.
Gold miners lift market, Orica, NAB deliver strong reports, News sinks
The local market was buoyed by an unexpected surge in the price of gold, which moved beyond US$1,700 per ounce once again. The result was a 2.5 per cent gain in the materials sector offsetting losses in eight of the remaining sectors with St Barbara (ASX:SBM) and Regis (ASX:RRL) the highlights, up 13 and 12.7 per cent respectively. The driver appears to be the near collapse of crypto trading platform FTX, which sent traders back into the safe haven commodity. Shares in National Australia Bank (ASX:NAB) fell 1 per cent despite reporting an 8 per cent increase in cash profit on a 9 per cent jump in revenue. The dividend was increased after the company managed to grow lending by 9.3 and deposits by 13.3 per cent over the last 12 months. The market was clearly concerned about the continued rise in costs and narrower net interest margin, which fell to 1.65 per cent. That said, management remain confident in the quality of their growing lending book. In a sign of the opportunity in Asia, China’s inflation result came in at just 2.1 per cent, well below expectations.
News Corp publishing drags, Whitehaven cuts production, Orica flags energy pressure
Shares in News Corp (ASX:NWS) were the worst on the market today, falling 11.2 per cent after the company reported a 75 per cent fall in profit to just US$66 million. The detractor was the book publishing businesses, hit by higher input costs, and the strength of the USD which impacted on the large UK and Australian businesses. Digital media remains the standout, jumping 19 per cent, while Foxtel profit grew by just 3 per cent. Shares in Orica (ASX:ORI) outperformed, gaining 7 per cent, despite the company requesting the government step in to deal with surging gas prices. Management delivered a 52 per cent increase in profit on a near 30 per cent increase in revenue, resulting in a 30 per cent increase in the dividend. The driver has been exceptional demand for commodities. Shares in Whitehaven (ASX:WHC) were at the other end of the spectrum, falling 8.5 per cent, after cutting production guidance due to flooding and weather issues that had impacted production and transportation.
Markets hit on crypto, mid-term uncertainty, Disney delivers downgrade
All three US benchmarks were hit by a confluence of factors overnight, with each down more than 2 per cent. This was led by the Nasdaq, which fell 2.5 per cent, as concerns in the crypto flowed into selling in the stock market. The Dow Jones fell 2 and the S&P500 2.1 per cent as results of the US mid-term elections have offered little in the way of clarity. The bigger news remains in the cryptocurrency sector as everything from Bitcoin to Solana is sold off amid a liquidity crunch at several of the sectors largest platforms. The Solana coin is down more than 70 per cent this week and 40 per cent overnight on concerns that key holders may be forced to sell their positions. This is flowing into markets by forcing investors in both assets to liquidate. Shares in Tesla (NYSE:TSLA) fell by more than 6 per cent after confirming that Elon Musk had sold a further US$4 billion worth of shares. But all eyes were on Disney (NYSE:DIS) which fell 13 per cent after delivering an earnings downgrade. The company managed the strongest 12 month period since 1996 but guidance suggesting sales growth of just 10 per cent shocked investors.
