The Aussie market is edging lower at lunch on Wednesday after a fairly flat start to the session. The ASX 200 is down 8 points at 7105 after swinging between small gains and losses. There has been another deluge of companies reporting profit results today which has prompted market moves.
The muted start is mostly due to a major constraint from the Commonwealth Bank (CBA), which is down 3% as it trades ex-dividend. The bank is taking 15 points off the ASX 200 index alone. CBA will pay a $2/share dividend on 31 March 2020. Another big four bank, Westpac (WBC), is also in the red with a fall of 0.5% after releasing a quarterly update. WCB expects to incur more expenses over FY20 mostly due to risk management and is already facing costs of $140 million (pre-tax) due to insurance claims from recent bushfires/hailstorms. Mortgage delinquencies remained contained and stable.
The IT sector is significantly underperforming as a number of tech stocks disappoint on earnings numbers. Logistics software firm Wistech Global (WTC) is slumping 21% even with strong growth for earnings over the first half. Revenue jumped 31% and EBITDA rose 29% but the concern is over a downgrade to its FY guidance on the coronavirus impact. Payment solutions firm, EML Payments (EML) is also down 10% despite reporting record first half revenue and earnings (EBITDA).
A number of high profile companies have helped to overcome declines from bank and tech names. Iron ore miner Fortescue Metals (FMG) is 1.1% higher after delivering record first half revenue on an elevated iron ore price. Wesfarmers (WES) is rallying 3% after total revenue lifted 6% to $15.2 billion with sales improving for Bunnings, Kmart and Officeworks. WES also announced it sold ~$1 billion worth of Coles Group (COL) shares. COL is down 4%. Domino’s Pizza (DMP) is also 12% higher with the pizza chain’s first half profit jumping 29% allowing it to increase its interim dividend. Online travel business, Webjet (WEB) has advanced 6.2% on a 24% rise in 1H20 revenue. Headline profit was down due to a $44 million hit from the collapse of Thomas Cook.
The AUD buys 66.88 US cents after Dec qtr wages data grew in-line with expectations at 0.5% with annual growth of 2.2%. So far, 1.4b units have traded worth $4.3b with 480 stocks higher, 485 lower and 376 unchanged.
Published by CommSec