Aussie shares had a relatively quiet start to the session but are trading at intraday highs at lunch, with the ASX 200 up 0.5 per cent to 6,562. This not only recoup’s Monday’s losses but pushes shares back to around 11.5 year highs. Equities seemed to lift a little further after the RBA minutes flagged further rate cuts this morning.
Telcos are the only losers, easing by just 0.1 per cent while healthcare stocks, Commonwealth Bank (CBA) and Coles (COL) are standing out. Coles (COL) is up 3.9 per cent and has hit a record high after unveiling a refreshed strategy which includes $1bn in cumulative costs savings over the next four years. COL expects to slow the rate of its brick and mortar network expansion and better cater its store offerings to the demographics of each region. COL made its ASX debut in November 2018 after splitting from Wesfarmers (WES).
BlueScope (BSL) is down 0.5 per cent after lowering its earnings guidance due to weaker US steel margins. Margins in North America have been mostly impact by softer steel prices. It now expects profits to lift by around 6 per cent (previously 10 per cent growth flagged). BSL announced the extension of its buy-back program however which seemed to soften the blow.
Macmahon (MAH) announced a $48m acquisition of a goldmining contractor in WA called GBF Undergound Mining.
Another underwhelming weekly sentiment survey was released this morning, highlighting that Australians are still cautious shoppers. Myer (MYR) is down 3.5 per cent. Potential rate cuts in coming months however could result in some extra spending dollar for mortgage holders.
The RBA cut the cash rate for the first time in close to three years a fortnight ago. The minutes from that meeting were released this morning at 11.30am AEST and have essentially confirmed that further easing is on its way. The central bank said that further easing is more likely than not, that lower rates are unlikely to risk a pick-up in borrowing and won’t risk a sharp inflation lift. CBA considers a rate cut in August and another in November as possible.
1.8bn shares have changed hands so far today worth a well above average $4.4bn. 548 stocks are up, 499 down and 409 are flat.
Published by CommSec