A 5 day winning streak for local shares has come to end on Wednesday following declines for US stocks overnight. US indices retreated as participants responded to comments made by Federal Reserve Chairman Powell. At the close the Dow Jones was lower by 299 points or 1.2%. The S&P 500 index was down by 1.3%. And the Nasdaq lost 91 points or 1.2%. The ASX 200 opened trade with a 17 point loss, before trading at a 30 point deficit at the worst levels of the morning.
Telecoms led the losses at lunchtime, followed by Property Trusts and Materials. Solid losses for Financials were also a feature of the weakness for the broader market. Only several sectors managed to advance over the morning led by Consumer Staples, Industrials and Materials. Participation over the morning was above average with around 1.6 billion transactions being measured by the ASX valued at $2.6 billion. At lunch 498 shares were higher, 594 were lower and 361 were unchanged.
Harvey Norman (HVN) shares were marked down aggressively after reporting 1H18 results. The retailer reported a 19% fall in net profit after tax (NPAT) to $207.7 million, while revenue declined 7% to $650.4 million on sales of $3.93 billion, which marked an increase of 5.3%. The weaker than expected reported results reflected losses in joint ventures and property revaluations which were lower the previous year, in addition to contracting margins in its Australian operations. A short time ago HVN shares were 14% or 68 cents lower at $3.90
Ramsay Health (RHC) shares fell 4% or $2.96 to $64.85 after reporting 1H18 results. The private hospital operator said revenue in the period rose 30% to $4.4 billion. Underlying NPAT was 7.5% higher at $288 million and EBIT was $470.4 million, an increase of 1.5%. RHC said it expects the operating environment in Australia to remain positive, while Europe will remain challenging. The group reaffirmed its full year earnings per share guidance for growth of 8% to 10%. RHC declared a fully-franked interim dividend of 57.5 cents, up 8.5% on the previous corresponding period. The record date for the payment is 7 March 2018 with payment to be made on 29 March 2018.
Shares in Bega Cheese (BGA) were lower by 4% or 35 cents at $6.98 after reporting EBITDA growth of 46% to $51.7 million and profit after tax growth of 31% to $20.6 million. The “headline” results included factors such as corporate costs associated with the recent acquisitions. Accounting for these results, underlying EBITDA rose 65% to $70.1 million and profit after tax growth increased 77% to $36.6 million. Revenue during the period rose 13.5% to $705.2 million, helped by the acquisition of Bega Foods, strong sales volumes of dairy ingredient products and increased volumes through retail and branded food service channels. BGA declared a fully franked interim dividend of 5.5 cents per share, which will be paid on 28 March 2018.
In economic news the RBA released its monthly Private Sector Credit figures for January. Total lending or credit rose 0.3% to be up 4.9% over the year. Lending for housing rose 0.5% to be up 6.2% in the last 12 months. Personal credit fell 0.1% to be down 0.9% in annualised terms and business lending was 0.5% lower, to be up 3.4% higher for the year. The January RBA credit data was slightly below market expectations. Annual credit growth at 4.9% is at its lowest point since May 2014. Weaker investor lending and business lending are weighing on overall demand for credit.
Published by CommSec