Aussie shares are off to a better start, with the ASX 200 lifting by 0.1 per cent despite hefty losses for some financial stocks. Following last night’s Federal Budget, local equities are improving for the eighth time in nine days and remain near their best levelsin three months.
President Trump decided to pull the US from the Iran nuclearaccord which was introduced in 2015 in a bid to reign in nuclear facilities in exchange for lifting sanctions. This means the US plans to reimpose sanctions on Iran in six months. The accord still remains in place however between Iran and five other countries (UK, France, Russia, China and Germany).
Energy stocks are lifting today despite a pullback in the price of oil. Santos (STO) and Woodside (WPL) are up strongly.
Last night’s Federal Budget included some measures aimed at pleasing voters ahead of next year’s election. While the document rarely moves the sharemarket in a big way the focus was on tax reform and infrastructure spending. Over the short-term, modest tax cuts of up to $10/week (~$530/year) for low and middleincome taxpayers received some attention. This will not be paid out each payday but instead the benefit is a tax offset at the end of the year. Consumer confidence however hit 13-week highs yesterday according to a weekly survey. Despite this, JB Hi-Fi (JBH) and Harvey Norman (HVN) are losing ground on Wednesday.
The $25bn in new infrastructure spending on roads, rail and public transport seems to be providing a modest boost to some construction and building products businesses. Transurban (TCL), Adelaide Brighton (ABC) and James Hardie (JHX) are up slightly.
Commonwealth Bank (CBA) is down 3.4 per cent and is the main weight on the broader market after its $2.35bn quarterly cash profit was ~$50m below last year’s result. Expenses rose,while margins and assets under management went backwards.
Greencross (GXL) is down 20 per cent after the operator of vet clinics delivered a profit warning blamed on fewer visits. Godfreys (GFY) is down 5 per cent after backing the $13m ($0.32/share) cash takeover offer for the retailer launched last month.
Incitec Pivot (IPL) is down 3 per cent after the fertiliser and explosives maker disappointed with its half year results which slumped by 95 per cent on one-off charges.
Reece (REH) is surging by 15 per cent after raising $248m from institutional investors to help pay for the $1.9bn acquisition of US plumbing company Morsco.
1.2bn shares have changed hands so far today, worth $2.3bn. 540 stocks are up, 450 are down and 367 are flat. Published by CommSec