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Aussie shares are being led higher by the banks, with the ASX 200 up 0.9 per cent or 57pts to 6,119. Despite the gains, this has been a rocky start to the new month and season. Yesterday was the best day in five weeks for local shares but this followed the worst day in around five weeks a day earlier. Global markets offered a positive lead overnight, with US stocks up 1.5 per cent while European stocks rallied for the first time in five sessions.

Mining and energy stocks are underperformers on Thursday due to softer gold and oil prices together with BHP trading exdividend. The price of oil slumped by 3 per cent overnight despite a larger than expected decline in US oil stockpiles. While this usually would push oil prices higher, the market seemed to overlook the report because of Hurricane Laura’s impact on inventories. Production was intentionally curtailed ahead of its arrival. The price of gold slumped by 1.7 per cent while iron ore was a standout, surging by 2.1 per cent thanks to solid Chinese demand, positive steel margins (which encourages steel mills to produce) and could remain well supported ahead of China’s winter which generally results in government restrictions to control pollution.

BHP, the world’s largest miner, is down by 1.9 per cent or 73 cents as it trades ex-dividend. BHP will pay eligible investors a 76.5c final dividend on 22 September. Starpharma (SPL) has received a $1 million award by the Medical Research Future Fund to expedite development and commercialisation of its novel SPL7013 antiviral nasal spray for COVID-19. SPL shares are up 4.5 per cent.

New Zealand based casino operator, Skycity (SKC) is up 7.3 per cent following the release of its FY20 results. SKC posted a NZ$235.3m net profit over the year (lowered guidance to NZ$234- NZ$236m on 20 August). SKC will not pay investors a final dividend, however intends to pay a dividend in 2021.

Austal (ASB) confirmed delivery of its third ship to the US Navy this year. This marks the 24th ship in ~10 years. The US is its largest market. ASB shares are still down 11 per cent Year-to-Date. The ASX 200 is down 8.5 per cent Year-to-Date.

Buy-now-pay-later companies are off to a much better start after being punished all week. While most of the majors are improving today, Zip Co (Z1P), Openpay (OPY) and Sezzle (SZL) have slumped by ~20 per cent this week. News of PayPal’s decision to enter the BNPL space in coming months, with a ‘Pay in 4’ offering in the US putting the sector on edge. PayPal’s market capitalisation is around 15 times the size of Afterpay (APT), has close to 200 million active accounts and generated ~US$1.5bn in profit over the past three months alone. All the Australian listed BNPL stocks posted losses in their results last month.

3.6bn shares have changed hands so far today worth $4bn. 730 stocks are up, 472 down and 349 are unchanged.

Published by CommSec