The ASX 200 trades 10 points (-0.13%) lower at 7655 at 3.15pm AEDT.
With US markets closed overnight for the Presidents’ Day holiday, the ASX 200 was left to its own devices today, taking its lead from earnings reports and a hawkish set of RBA meeting minutes.
The minutes showed that at its February board meeting, the RBA considered two options – hiking rates by 25 basis points (bp) or keeping the cash rate on hold at 4.35%. The RBA’s decision to leave rates unchanged “centred on the observation that the risk of inflation not returning to the Board’s target within a reasonable timeframe had eased.”
Based on the high cost of inflation not returning to target within the envisaged timeframe, “members agreed that it was appropriate not to rule out a further increase in the cash rate target.” The Australian interest rate market remains uninterested in talk of additional RBA rate hikes, and instead has 35bp of easing priced for 2024.
Today’s market movements
Mining sector
It was mining heavyweight BHPs’ turn in the earnings spotlight today. BHP reported a 6% increase in revenue to US$27.2 billion but an 86% dive in statutory profits to US$927 million after writing off its Nickel West assets and taking a US$3.2 billion charge in relation to the Samarco dam failure. Cushioning the blow, the company paid a US$0.72c dividend, more than the $0.70c the market expected.
- BHP: -1.11% to be trading at $45.53
- Rio Tinto: -2.80% to $127.30 ahead of its earnings report tomorrow
- Fortescue: – 1.97% to $27.87 and its due to report on Thursday
Other stocks
- Sims Metals: -9.37% to $13.17
- Humm Group: -20.86% to $0.55c
- Baby Bunting: – 12.53% to $1.64 after their earnings reports disappointed.
- Sonic Health Care dived 7.76% to $29.24 after its half-year profit fell 47% to $202 million, and as the company lowered its full-year guidance “as the impact of the Covid pandemic” dissipated.
Earnings season star
Yesterday’s earnings star A2 Milk fell 1.94% to $5.57, following a raft of broker downgrades. Today’s earnings season star was wealth manager Hub24, whose share price surged 7.49% to $40.34 after reporting record net inflows of $ 7.2 billion in the year’s first half.
Banking sector
Away from earnings reports, the share price of ANZ has fallen 2.74% to $27.72 after a court overruled the ACCC to approve its $4.9 billion takeover of Suncorp’s banking division.
- Macquarie: – 0.82% to $190.44
- CBA: -0.09% to $117.02
- NAB: + 0.87% to $33.46
- Westpac: + 2.36% to $25.83 following a broker upgrade
ASX 200 technical analysis
The decline from early February’s 7703 high to last Tuesday’s 7489 low unfolded in three waves, usually indicative of a corrective or countertrend move. As such, providing the ASX 200 remains above last week’s 7489 low, expect a retest and break of the 7703 high with a scope to 7900.