Weekly ASX Share Trading Wrap Up

Weekly ASX Share Trading Wrap Up

Last week, Australian shares managed to shake off concerns from several high-profile names in the US surrounding the stock market, the economic outlook and the nation’s health response. The market’s indecisiveness was underscored by the split in economic data that fared better-than-expected compared with that which came in worse-than-expected. By the end of the trading week, however, the ASX 200 recorded a gain of 0.3%, finishing on 5,404.80 points.

 

Which shares excelled?

Gold stocks continued their stellar run of late, with the precious metal at one point rising nearly 3% during the week to momentarily touch US$1750/oz. In turn, all the usual gold producers got a boost out of the move, with the sector led higher by the likes of Saracen Mineral Holdings (ASX: SAR), St Barbara (ASX: SBM), Regis Resources (ASX: REG), Silver Lake Resources (ASX: SLR) and Newcrest Mining (ASX: NCM).

Elsewhere, Pushpay Holdings (ASX: PPH) backed up its best-performing rally from the week prior with another strong showing, this time gaining 8.8%. The move comes on the back of the company’s recent full-year results, which drove the share price higher by more than 50% across just a few trading sessions.

Ansell (ASX: ANN) had a standout week, with the company’s shares rising 8.1%. Although no news was released to the market, the stock has found favour since it reaffirmed its guidance at the beginning of April, with shares now trading in line with their pre-COVID and all-time high. Also moving sharply higher in the absence of any announcements was Orora (ASX: ORA), which climbed 7.5%.

There were trading updates issued by Breville Group (ASX: BRG) and Amcor (ASX: AMC), both of which were received positively by the market. In the case of Breville, its shares rose 7% after it reported strong trading and took the initiative to refinance its debt and raise more than $100m in fresh equity from the market. Meanwhile, Amcor’s 3Q 2020 results showed adjusted EBIT rose by 6.9% in constant currency terms. The company also committed to pay a dividend, something that many other stocks have deferred in recent times. Shares in AMC increased by 5.8% for the week.

The market was also supported by solid gains among some of the index’s blue-chip heavyweights, including Ramsay Health Care (ASX: RHC), up 5.3%, Brambles (ASX: BXB), up 4.6%, Telstra (ASX: TLS), up 4.6%, Fortescue Metals Group (ASX: FMG), up 4.2%, and Cochlear (ASX: COH), up 3.6%.

 

 

Which shares dragged on the market?

Each of last week’s hardest-hit stocks were sold down sharply despite no price-sensitive news being announced to shareholders. Yancoal (ASX: YAL) shares slid 11.6%, Challenger (ASX: CGF) dived 10.9% and Unibail-Rodamco-Westfield (ASX: URW) shed 10.4%. In the case of URW, the stock touched a new all-time low as shareholders grow wary of the impact that COVID may have on consumer spending and the viability of many retail stores in the short-to-medium term.

Earlier in the week, Incitec Pivot (ASX: IPL) announced its half-year profit results, with revenue for the period rising 6% to $1.85bn. However, offsetting that result was its decision to abandon a dividend and raise $600m from institutional and professional shareholders at an 8.7% discount to the last trading price at the time. In addition, the company is also running a separate $75m equity raising for retail holders. By the end of the trading week, IPL shares had declined 10%.

Shares in Boral (ASX: BLD) tanked 8.7% following the company’s trading update. In its announcement, the building materials supplier advised the market that it has faced temporary closures and substantial disruptions in some jurisdictions, leading to a decrease in revenue and margin compression.

Xero (ASX: XRO) was another company that took a hit in the wake of its results announcement, despite the fact that the tech darling achieved its first full-year profit. Overshadowing the achievement was the company’s outlook, where management pointed towards a much more difficult FY21 amid COVID-19, with early trading conditions across April already signalling some impact. The stock tumbled 8.5%.

Rounding out our coverage, some of the other shares subject to large falls last week were Tilt Renewables (ASX: TLT), down 9.4%, IOOF Holdings (ASX: IFL), down 9%, Polynovo (ASX: PNV), down 8.2%, plus Domain Holdings Australia (ASX: DHG), Scentre Group (ASX: SCG) and Worley (ASX: WOR), with the trio each losing 7.7% of their market caps.

 

 

This week’s trading outlook

After a volatile trading session in the US on Friday night, ASX futures managed to jump higher, with the local market poised to open modestly higher when trading resumes in the week ahead.

Nonetheless, one of the emerging developments was news that the US is said to be amending export rules that would block the sale of certain semiconductors to Chinese company Huawei, a move that could escalate trade tension between the nations and influence market sentiment.

The week ahead will feature less economic news to keep an eye on, with the RBA minutes due on Tuesday, followed by manufacturing and services data on Thursday. In the US, housing starts, jobless claims, plus manufacturing and services PMI data will be monitored closely. China, meanwhile, will hold its annual congress meeting later in the week, where some analysts expect the country may unveil new moves to stimulate its economy.

Macquarie Group (ASX: MQG) will trade ex-dividend on Monday morning courtesy of the $1.80 dividend per share (40% franked) that it recently declared. Later in the week, Pendal (ASX: PDL) is also expected to trade ex-dividend having previously declared a partially-franked dividend of $0.10 per share.

There will also be a series of earnings results unveiled, including from Elders (ASX: ELD) on Monday, Technology One (ASX: TNE) and James Hardie (ASX: JHX) on Tuesday, plus Aristocrat Leisure (ASX: ALL) on Thursday. Each of these stocks are likely to see an increase in volume following their reports, which could be something that sharp-eyed traders assess.

 

We’ll be back next week with another Weekly ASX Trading Wrap Up – until then, have a great week!

 

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