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28/08/19
       
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The tech sector led the Australian share market higher on Tuesday, after Donald Trump said trade talks with China would resume and he was hopeful for a deal.

The benchmark S&P/ASX200 index finished Tuesday up 31.1 points, or 0.48 per cent, to 6,471.2 points, while the broader All Ordinaries was up 34.6 points, or 0.53 per cent, to 6,565.6 points.

The gains came after Trump said at the G7 summit of world leaders in France that Beijing had offered to resume negotiations and he thought they wanted to make a deal "very badly" - although China's foreign minister said he was unaware of any such offer.

Tech stocks were the biggest gainers, collectively up 3.2 per cent, with Afterpay Touch gaining 7.8 per cent to $25.87 ahead of its earnings report on Wednesday.

Logistics software company Wisetech Global gained 3.6 per cent to hit an all-time high of $34.50 and Appen gained 3.8 per cent to $24.71.

Wesfarmers gained 1.1 per cent to $39.10 after announced its full-year profit had more than quadrupled to $5.51 billion, including gains of $3.2 billion from the spinoff of Coles and other divestments.

Nanosonics soared 32.6 per cent to an all-time high of $6.50 after announcing its profit before tax tripled to $16.8 million on increased sales of ultrasonic probe steriliser devices.

Communications company Speedcast fell 32.9 per cent after declaring a $175 million statutory net loss and cancelling its dividends.

Strike Energy soared 89.7 per cent and Warrego Energy 67.6 per cent after the junior oil and gas explorers said their West Erregula-2 exploration well had made a "staggering" gas discovery 230km north of Perth.

Gold miners fell as gold prices eased to $US1,530 an ounce on the decrease in trade tension, with Evolution down 5.1 per cent, St Barbara down 5.9 per cent and Northern Star down 6.6 per cent after making a $243 million off-market takeover bid for WA gold miner Echo Resources.

Echo shares were up 30 per cent to 32.5 cents.

Elsewhere in the sector BHP gained 0.8 per cent to $34.95, Rio Tinto was up 1.2 per cent to $83.76 and Fortescue Metals gained 5.3 per cent to $7.55.

The financial sector was up 0.5 per cent, with Commonwealth up 0.5 per cent to $77.15, NAB up 0.9 per cent to $27.30, ANZ up 0.4 per cent to $26.38 and Westpac flat at $27.62.

AMP was up 1.5 per cent to $1.66 and after the market closed S&P lowered its rating on the company by one notch, reflecting the divestment of AMP Life.

Inghams fell 17.1 per cent to $3.35 after the poultry giant said its efforts to optimise its processing network had faltered due to higher demand and costs were continuing to mount.

Caltex Australia fell 4.6 per cent to a two-month low of $24.66 after reporting a 54 per cent decline in first-half profit.

Rival Viva Energy dropped 6.2 per cent to a fresh six-month low of $1.97.

 
International Markets

Wall Street has slipped, weighed down by financial stocks as a deepening of the Treasury yield curve inversion raised US recession worries and uncertainty over any progress in trade negotiations between the US and China took a toll.

US stocks initially advanced, building on Monday's bounce, as President Donald Trump forecast another round of talks with Beijing. China's foreign ministry, however, reiterated on Tuesday that it had not received any recent US telephone call on trade.

The Dow Jones Industrial Average on Tuesday fell 120.93 points, or 0.47 per cent, to 25,777.90; the S&P 500 lost 9.22 points, or 0.32 per cent, to 2,869.16; and the Nasdaq Composite dropped 26.79 points, or 0.34 per cent, to 7,826.95.

Financial shares, which tend to weaken in lower-rate and soft economic environments, lost 0.72 per cent, while the defensive utilities sector led advancing groups, edging up 0.14 per cent.

The S&P 500 has lost nearly 4 per cent in August on worries over the impact of the intensifying US-China trade war on the slowing global economy and corporate profits, along with uncertainty around the pace of US interest rate cuts from the Federal Reserve.

With the next Federal Reserve meeting scheduled for mid-September, investors are gauging the strength of the US economy for clues on where rates are headed. The release next week of the government's closely watched monthly jobs report and manufacturing data will give investors factors to consider before the policy announcement.

Among individual stocks, Johnson & Johnson shares rose 1.44 per cent after an Oklahoma judge said the drug-maker must pay $US572.1 million ($847 million) for its part in fuelling the US opioid epidemic, a sum that was substantially less than what investors had expected.

Philip Morris International shares fell 7.76 per cent after the tobacco-maker said it was in talks with Altria Group to combine in an all-stock merger of equals. Altria's shares were down 3.95 per cent.

Shares of JM Smucker tumbled 8.18 per cent after the packaged food-maker cut its full-year earnings forecast and missed estimates for quarterly profit and sales.

Source: Morningstar
 
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