Australian shares are lifting for just the second time in seven sessions, with gains from property stocks and CSL Limited (CSL) leading the market higher. The ASX 200 is up by 0.25 per cent at lunch on the first day of a new quarter and financial year following firmer commodity prices and a positive lead from Wall Street.
The start of a new month ushers in plenty of economic data and this week is no different. On Tuesday the Reserve Bank (RBA) is likely to keep interest rates on hold for a 23rd straight month. Investors in retail stocks will keep track of the latest May retail spending data from the Bureau of Statistics. Offshore, US-China-European Union trade tensions will remain in focus ahead of the Independence Day holiday in the US on Wednesday and the key jobs growth data on Friday.
In company news, Sigma Pharmaceuticals (SIG) is the biggest mover, slumping by 37 per cent after warning of lower profits and being unable to renegotiate a key contract with My Chemist/Chemist Warehouse Group. SIG now expects EBIT of around $75 this year but anticipates earnings to drop to between $40m – $50m in FY20.
EBOS Group (EBO) is surging by 5 per cent after winning the tender to act as the exclusive third party distributor of pharmaceutical products to over 400 Chemist Warehouse stores in Australia from July 2019. The initial agreement will last for five years with the potential for a three-year extension.
Village Roadshow (VRL) announced the sale of its Wet’n’Wild Water Park in Western Sydney to Spanish firm Parque Reunidos for $40m. VRL aims to use the funds to pay down debt and expects a $25m hit to its FY18 earnings.
CIMIC (CIM) is one of the best, gaining 3 per cent after winning a $480m contract to do work on coal mines in Queensland. This will include drilling and blasting work.
The latest China Caixin Manufacturing PMI was largely inline with expectations, easing just slightly from 51.1 to 51.0. A reading above 50.0 indicates manufacturing industry expansion.
1.2bn shares have changed hands so far today worth $1.9bn. 607 stocks are up, 404 down and 364 are unchanged.
Published by CommSec