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Thanks to another big improvement for US markets last night,Aussie shares are off to a better start with the ASX 200 up 0.5 per cent at lunch. This makes it the local market’s fifth straight gain, takes the index above 6000pts and has hit a three-week high in the process. Over the past couple of weeks equities have been building up momentum, largely making up for the terrible start to the month which was triggered by volatile US markets.
The telcos are a touch lower, due to Telstra (TLS) slipping by ~0.2 per cent while a handful of stocks trading ex-dividend are also under pressure. Elsewhere however, most other sectors are lifting at lunch. The banks are up ~0.5 per cent while mining heavyweights BHP, RIO and BlueScope (BSL) are higher.
Well over 90 per cent of companies set to post their results this month have already done so, with mixed outcomes. A record 94 per cent reporting half year results have made a profit while a little less than 60 per cent have improved earnings (below long-term/10- year average). 86 per cent of companies will pay investors a dividend, with 75 per cent deciding to increase their payments.
Most companies out with their results today are lifting. This includes Caltex (CTX), Iluka Resources (ILU), Cabcharge (CAB) and Costa Group (CGC).
Caltex (CTX) is up 4.4 per cent after beating its annual guidance slightly with its results. Replacement Cost Operating Profit – analysts’ preferred measure of underlying earnings – rose 18 per cent to $621m over FY17. This figure accounts for/excludes the impact of volatile oil prices. This was ahead of guidance for a result between $600-$620m. CTX plans to end its current franchise system for petrol stations, expected to spend as much as $120m to buy the franchised stores back in the next couple of years.
Iluka (ILU) is up 4.7 per cent. While it has posted a loss of $171.6m in FY17, it had a significant impairment charge of $185m. ILU expects the mineral sands market to remain positive in 2018. Cabcharge (CAB) is down 0.1 per cent. The taxi payment co. posted a smaller HY loss of $5.1m ($106.8m loss a year earlier).
Costa (CGC) is up 9.5 per cent after Australia’s largest grower of fruit and vegetables said it expects profits to lift 25 per cent over the year (previously 20 per cent earnings growth). CGC continues to make acquisitions, buying berry and avocado producers.
Consumer confidence rose by 2.3 per cent last week according to results from the latest weekly consumer sentiment survey out this morning. Recovering sharemarkets could be making some feel a little more settled. Harvey Norman (HVN), Myer (MYR) and Premier Investments (PMV) are higher.
1.5bn shares have changed hands worth $2.7bn. 541 stocks are up, 478 are down and 381 are unchanged.
Published by CommSec