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Morning Bell 24 February

Paulina Peters
February 24, 2022

The Aussie share market managed to advance 0.6% yesterday. Nine of the eleven industry sectors posted gains, with the tech sector advancing the most. On the flip side, the real estate sector and utilities sector posted small losses.

On the ASX200 leaderboard, HUB24 (ASX:HUB) lifted nearly 10% off the back of its solid half-year results. The investment advice company experienced a record inflow of funds during the half, and an increase of 80% in its group underlying EBITDA. Macquarie maintained its Outperform rating on HUB and stated that the company is now its preferred exposure among wealth platforms. And a few tech stocks performed well, including Tyro Payments (ASX:TYR), as well as Life360 (ASX:360) and Zip (ASX:Z1P), who are both set to report today. Meanwhile, Domino’s Pizza (ASX:DMP) was the worst performer, plummeting 14% after its half-year results showed that its underlying net profit had plunged 5.3% to $91.3 million. This was short of Bell Potter’s and consensus’ expectations of $96m. Bell Potter have retained its HOLD rating with a 27% reduction in its price target to $95.

The most traded stocks by Bell Direct clients yesterday included AVZ Minerals (ASX:AVZ), BrainChip (ASX:BRN) and Woodside Petroleum (ASX:WPL).

In the US, the S&P500 closed lower for the fourth straight session, the Dow was down over 400 points and the Nasdaq declined more than 2% with the market is struggling to find direction given the Russia-Ukraine tensions.

In line with the negative session over on Wall Street, the futures are suggesting the Aussie share market will open 1.3% lower this morning.

What to watch today:

  • In commodities, the oil price is currently up, trading around US$92 a barrel. The gold price is up about 0.6% to US$1,907 an ounce. The palladium price is up 5%, so keep watch of ASX stocks like Chalice Mining (ASX:CHN) and Liontown Resources (ASX:LTR). And the seaborne iron ore price is trading around US$143 a tonne.
  • Reporting season:
    • Firstly, Rio Tinto (ASX:RIO) released its results after market close yesterday, announcing a record financial result and total dividend of US247cps. So keep watch of RIO when the market opens.
    • We’ll also hear from several travel stocks, including Qantas (ASX:QAN), Flight Centre (ASX:FLT) and Auckland International Airport (ASX:AIZ).
    • Tech stocks like Zip Co (ASX:Z1P), Appen (ASX:APX), Altium (ASX:ALU) and Life360 (ASX:360) are also set to report, as well as Blackmores (ASX:BKL) and Iluka Resources (ASX:ILU).
  • Bell Potter expects Appen (ASX:APX) to deliver NPAT of US$41m, while consensus is expecting $US39.6m.
  • Aristocrat Leisure (ASX:ALL) is holding its AGM today.
  • There are a several companies going ex-dividend today also, including BHP Group (ASX:BHP), Challenger (ASX:CGF), OZ Minerals (ASX:OZL), Whitehaven Coal (ASX:WHC) and Woodside Petroleum (ASX:WPL).

Trading Ideas:

  • Bell Potter have maintained its BUY rating on Coronado Global Resources (ASX:CRN) with a price target of $1.65. Bell Potter noted that the speed of CRN’s balance sheet repair has been remarkable and its strong cash generation at record met coal prices will likely hold up until at least mid-2022.
  • Trading Central has a bullish signal on Steadfast Group (ASX:SDF), indicating that the stock price may rise from the close of $4.92 to the range of $5.28 – $5.36 in the next 19 days according to standard principals of technical analysis.

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