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The Morning Report is updated each weekday morning and is freely available to all site visitors. It provides a brief snapshot of both overnight global financial markets and the local share market from the previous day, including top 5 and bottom 5 movers, open corporate actions, and upcoming dividends. Also provided are quotes on indices, commodities and currencies, plus an Economic Diary.

30.07.2021

The Morning Report

Overnight global markets, Aussie market wrap, and research updates


Updated: Friday 30/07/2021.

GLOBAL MARKET WRAP

The S&P 500 rose 19pts overnight to close 0.4% higher at 4,419, breaking new record highs as disappointing US economic data overnight suggested the Federal Reserve may be slower to tighten monetary policy support. The Materials sector was the strongest performer (+1.1%). The US 10-year treasury yield rose 4bps to 1.27%, while the USD Index fell 0.5% to 91.86 this morning.

Amazon.com (AMZN) reported 2Q21 results this morning with revenue of $US113.1 billion, up 27% year-on-year but below estimates of US$115.2 billion, and EPS of US$15.12 vs estimates of US$12.30. Amazon Web Services was the standout of the result growing revenue by 37% in the quarter to US$14.8 billion, up from the 32% growth in the prior quarter and ahead of expectations. AMZN gave weaker than expected 3Q21 guidance, expecting revenue growth of 10-16%, citing tough year-on-year comparisons as they cycle through COVID-19 lockdowns last year. AMZN shares fell 7.2% in aftermarket trading to US$3,340.

Coronavirus update – The latest data from the World Health Organisation (WHO) showed the number of confirmed coronavirus cases was 195,886,929, rising by 595,149 yesterday. Tokyo has recorded 3,177 new COVID-19 cases yesterday, hitting a new daily record for the second day in a row as pressure begins to mount on the hospital system and increases concerns to the ongoing Olympic games.

US: The first estimate for 2Q21 GDP disappointed overnight coming in at a 6.5% annual growth rate, well below the 8.0% growth rate expected. Personal consumption expenditures grew strongly, posting an 11.8% annual growth rate, led by growth in services and nondurable goods. Jobless claims for the week 24 July came in at 400,000, above the expected 380,000 and down on the revised 424,000 in the week prior.

Eurozone: Economic sentiment rose to 119.0 in July, up from 117.9 in June and slightly ahead of the expected 118.7. GDP is expected to increase 1.5% in 2Q21, rebounding back slightly from the downwardly revised 0.6% contraction in the prior quarter, whilst the unemployment rate is expected to hold steady at 7.9% in June.

Canada: GDP is expected to fall 0.3% in May, as it did in April, which ended a streak of 11 consecutive monthly increases in GDP.

LOCAL MARKET WRAP

The ASX 200 rose 38pts yesterday to close 0.5% higher closing at 7,417, with the Information Technology sector the strongest performer (+2.6%). The SPI Futures Index is trading 7pts higher this morning at 7,338. The 10-year treasury yield was flat at 1.15% and the AUDUSD rose 0.3% to 0.7396 this morning.

Coronavirus update – The total number of cases rose by 260 yesterday to 33,732, with 2,857 active cases and 247 locally acquired cases. New South Wales have formally requested support from the Australian Defence Force to help them enforce COVID-19 restrictions within the state, as it recorded a record high 239 new COVID-19 cases yesterday.

Iress Limited (IRE) yesterday held an investor day outlining new medium-term growth targets to more than double NPAT by 2025, with potential for further upside. IRE has given base case FY25 targets of $766-806 million in revenue which represents 7-8% growth pa on FY20 revenue, $240-250 million in segment profit in constant currency at 9-10% pa growth, and NPAT of ~$120 million, representing 15% pa growth. IRE also announced an on-market share buyback of up to $100 million, as well as advising they received a $15.30-15.50 takeover offer from EQT Fund Management in which the IRE Board rejected. IRE shares rose 13.9% to close at $14.25.

Unibail Rodamco SE (URW) yesterday reported 1H21 results significantly impacted by COVID-19 with the Group’s centres closed for 68 days on average vs 67 days in 1H20. Net rental income was €785 million, down 22.4% on 1H20 on a like-for-like basis, with adjusted recurring EPS down 30.4% to €3.24. Proportionate portfolio valuations fell slightly to €54,966 million, down 2.4% on the €56,314 million at 31 December 2020. URW noted that although on-going roll out of vaccines is progressing well, COVID-19 impacts will continue into 2H21 and hence will not provide FY21 guidance. URW shares fell 0.7% to close at $5.79.

 

ASX 200 TOP MOVERS

Company Name Close Price Change (%)
IRESS Ltd (IRE) $14.25 13.9
Polynovo Ltd (PNV) $2.27 7.1
Zip Co Ltd (Z1P) $6.94 5.8
Nickel Mines Ltd (NIC) $1.10 5.7
Regis Resources Ltd (RRL) $2.62 5.6

ASX 200 BOTTOM MOVERS

Company Name Close Price Change (%)
Pointsbet Holdings Ltd (PBH) $11.29 -4.5
Redbubble Ltd (RBL) $3.64 -3.7
Stockland Corporation Ltd (SGP) $4.33 -2.5
BWP Trust (BWP) $4.07 -2.2
GPT Group (GPT) $4.63 -1.9

ECONOMIC DIARY

Country Event Date AEST
Japan Unemployment Rate 30/07/2021 09:30
Japan Industrial Production 30/07/2021 09:50
Australia PPI 30/07/2021 11:30
Australia Private Sector Credit 30/07/2021 11:30
Germany GDP 30/07/2021 18:00
Eurozone CPI 30/07/2021 19:00
Eurozone GDP 30/07/2021 19:00
Eurozone Unemployment Rate 30/07/2021 19:00
Canada GDP 30/07/2021 22:30
United States Employment Cost Index 30/07/2021 22:30
United States Personal Income and Outlays 30/07/2021 22:30
United States Chicago PMI 30/07/2021 23:45
United States Uni of Michigan Consumer Sentiment 31/07/2021 00:00
United States Baker Hughes Oil Rig Count 31/07/2021 03:00
China CFLP Manufacturing PMI 31/07/2021 11:00
Japan Markit/Nikkei Manufacturing PMI 02/08/2021 10:30
Australia Melbourne Institute Inflation 02/08/2021 11:00
Australia ANZ Job Advertisements 02/08/2021 11:30
China Caixin Manufacturing PMI 02/08/2021 11:45
Germany Markit/BME Manufacturing PMI 02/08/2021 17:55
Eurozone Markit Manufacturing PMI 02/08/2021 18:00
United Kingdom Markit/CIPS Manufacturing PMI 02/08/2021 18:30
United States Markit Manufacturing PMI 02/08/2021 23:45

OPEN ASX 200 CORPORATE ACTIONS

NameCODEEVENTLonsec RecommendationCLOSING DATE
Evolution MiningEVNShare Purchase PlanUnder Review20/08/2021
Metcash LtdMTSOff market buy-backNA13/08/2021

Members can view the latest Corporate Action Journal in the "Latest Research" section for details on Lonsec's recommendations on these corporate actions.

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