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.
RBA spurs market to gain, Mineral Resources rockets, Nuix jumps
The local market was buoyed to a significant 1 per cent gain for the week, following a strong day on Friday.
The 0.7 per cent gain was driven by the energy and materials sector which gained 1.1 and 3.3 per cent respectively on news of a potential split of Mineral Resources (ASX:MIN).
Rumours that the company could divest their lithium business from their iron ore operations sent the stock up 13.6 per cent and 21.8 for the week.
This buoyed the broader mining sector with Pilbara (ASX:PLS) and Lake Resources (ASX:LKE) both gaining more than 20 per cent.
The iron ore price was also boosted by an unexpectedly low Chinese inflation print with Fortescue (ASX:FMG) gaining 6.1 per cent, with the materials sector up 5.1 per cent over the five days.
Shares in Nuix were suspended after the company jumped 24 per cent despite any news from the company while Ramsay (ASX:RHC) dropped 1.3 per cent on the cancellation of their asset sale.
The group has ended discussions on the sale of their Malaysian joint venture at a value of US$1.35 billion.
The consumer staples sector was the rare detractor falling 1.2 per cent on Friday.
US market surges, tech drives rally, DocuSign, Kroger beat
All three US benchmarks posted strong gains to finish the week along with solid results over the five days.
Led by the technology sector, Meta Platforms (NYSE:META) gained 4.4 per cent and supported a 2.1 per cent gain in the Nasdaq.
It was a similar story for the S&P500 and Dow Jones, which finished 1.5 and 1.2 per cent higher respectively, with the energy sector contributing to the latter.
Retailer Krogers (NYSE:KR) was a standout, with the company reporting a 9.3 per cent increase in sales, or 5.2 per cent excluding fuel, with profit also nearly doubling to US$731 million.
Importantly same store sales growth was more than 5 per cent suggesting the retailer remains well supported despite inflationary pressures.
Speaking on inflation and expectations are now for a contraction in the monthly price rise in August when figures are released next week.
DocuSign (NYSE:DOCU) shares also gained 10 per cent after the company reported a 22 per cent jimp in revenue to US$622 million and upgrading full year expectations.
Over the week the Nasdaq led the way despite global interest rate hikes, gaining 4.1 per cent, with the S&P500 and Dow delivering 3.6 and 2.7 per cent in a sharp turnaround.
RBA hikes to slow, China remains immune, tech takeovers accelerate
It was a week of rate hikes across the world with the Reserve Bank, Bank of Canada and ECB all delivering super-sized increases, however, a speech from Governor Lowe may have changed the narrative.
Commentary made at an industry event suggested that the pace of rate hikes may well be slowing and finally giving some consideration to the lagged impact of rate rises on the highly leveraged Australian consumer.
While the rest of the world is fighting off record levels of inflation, China’s CPI increased just 2.5 per cent year on year in August, well below expectations and once again reflecting the vertically integrated nature of the economy.
China remains among the most undervalued regions in the world with the most supportive policy settings.
News this week that Tyro (ASX:TYR) was under offer and rumours around Nuix have reiterated one of the challenges of the post-pandemic malaise for technology companies.
That being the risk that these companies are acquiried at significantly lower valuations than their previous highs.
