Between the Bells Bell Direct

Wall St closed higher overnight as traders lifted Federal Reserve rate cut expectations. The Dow Jones closed 0.46% higher, the S&P 500 ended the trading session over 1% higher and the tech-heavy Nasdaq closed 1.19% in the green.
Over in Europe, markets closed higher following the release of softer-than-expected US jobs data. Germany’s DAX rose 0.96% and the French CAC and the FTSE 100 both gained nearly half a percent.
Locally yesterday, the ASX200 closed 0.70% higher with the majority of the sectors closing in the green. The real estate and utilities sectors led gains, rallying 1.73% and 1.24% respectively. This was offset by the industrial sector which fell 0.18%.
What to watch today:
The Australian share market is set to open higher with the SPI futures suggesting a rise of 0.49% at market open this morning.On the commodities front this morning,
 Oil is trading 0.75% higher at 78 US dollars and 70 cents a barrel after Saudi Arabia rose crude prices for Asian customers, suggesting confidence in global energy demand. Gold is trading 0.98% higher at 2323 US dollars an ounce and iron ore is trading 0.04% lower at 118 US dollars and 3 cents a tonne.Trading Idea:
Bell Potter maintains a buy rating on GrainCorp (ASX:GNC) despite slightly lowering its 12-month price target to $9.20. The buy rating is maintained by Bell Potter after the outlook for GNC is shifting towards the 2024-25 crop and potential La Nina development and what this means for FY25 earnings. Improved east coast prospects have emerged at a period when Northern Hemisphere crop conditions have arguably deteriorated and would be typically viewed as favourable for accumulation margins and oilseed basis.

Wall street closed higher on Friday bolstered by a softer-than-expected jobs report which boosted investor hopes of rate cuts in the near future. The Dow Jones rose 1.18%, the S&P500 added 1.26% and the tech-heavy Nasdaq climbed 1.99% on the rate cut optimism.
Non-farm payrolls indicated 175,000 jobs were added to the U.S. economy in April, which was well below the 240,000 economists were expecting and the US unemployment rate rose to 3.9% from 3.8% for the month. Wages data also came in below expectations which is a strong sign inflation is becoming less sticky as wages inflation has been a key point of stubborn inflation over the last year. Apple shares rose almost 6% on Friday after the tech giant announced a near US$110bn share repurchase and beat analysts’ expectations for 1st quarter results.
Over in Europe on Friday, markets closed higher to round out a negative week as investors responded to corporate earnings results. The STOXX600 ended the day up 0.44%, Germany’s DAX added 0.6%, the French CAC rose 0.54%, and in the UK, the FTSE100 ended the day up 0.51%.
In Asia on Friday markets ended the week in positive territory led by Hong Kong’s Hang Seng rising 1.48%.
Locally on Friday, the ASX200 rose 0.55% as every sector ended the day in positive territory led by consumer discretionary stocks rising just shy of 2% while reit stocks added 1.55%. Block was the best performing stock locally rising 9.83% after the payment platform posted impressive quarterly results that exceeded analysts’ expectations including gross profit rising 22% year-on-year to US$2.09bn.
Gold miners came under pressure locally on Friday amid the sliding price of the precious commodity with evolution mining falling 5.57%, while Ramelius Resources fell 2.04% and Regis Resources declined 1.91%.
Diversified financial house Macquarie fell on Friday after the company released full year results including net profit falling 32% while net operating income declined 12% over the year. Macquarie attributed the fall in key results to a sharp decline in the commodities and global markets business, and a fall in the Macquarie Asset Management business division.
What to watch today:
Ahead of the first trading session for the new trading week, the SPI futures are expecting the ASX to open Monday’s session up 0.3% on the back of Wall Street’s jobs-driven rally on Friday.Looking at commodities this morning, oil is trading 1.22% lower at US$77.99/barrel, gold is down 0.13% 2301.30/ounce and iron ore is down 0.04% at US$118.03/tonne.AU$1.00 is buying US$0.66, 101.08 Japanese yen, 52.68 British pence and NZ$1.10.Trading Ideas:
Bell Potter has increased the 12-month price target on Nickel Industries (ASX:NIC) from $1.50 to $1.54 and maintain a buy rating on the nickel producer following the company’s release of its March quarter production from its Rotary Kilm Electric Furnace operations including production of 31,840 tonnes of contained nickel and cash costs below Bell Potter’s forecasts. The company faced impacted mining production from its Hengjaya Mine however, mixed hydroxide precipitate production increased 16% which ramped up towards nameplate capacity. Bell Potter’s analyst sees tailwinds are increasing in CY24 once mining permit delays are overcome.

This week's US earnings season was a mixed bag of highs and lows in the market spotlight. Pfizer soared despite COVID vaccine sales dip, while PayPal and Pinterest showed tech potential. Yum Brands stumbled, despite Taco Bell's digital surge. Coca-Cola beat expectations but grappled with inflation and market shifts.
In this week’s wrap, Sophia covers:
• (0:29): Pfizer’s strong quarter despite COVID dip
• (1:05): PayPal’s profitability focus against tech giants
• (1:46): Pinterest exceeding expectations, contributed by investments in AI
• (2:42): Taco Bell’s digital surge
• (2:54): Coca-Cola’s key highlights & weaknesses
• (4:46): the most traded stocks & ETFs by Bell Direct clients
• (5:16): economic data to watch next week.

US equities closed mixed overnight after the Federal Reserve kept rates on hold at 5.25% – 5.5% and ruled out that the central bank’s next move could be a hike. While the Dow Jones closed higher off the back of the Fed’s announcement, the broader market finished lower after a volatile trading session. During the session the S&P500 was up 1.2% before closing 0.34% lower, and the tech-heavy Nasdaq had climbed 1.7% before closing 0.33% lower.
What to watch today:
The Australian market is set to open 0.07% lower this morning, following heavy losses yesterday across all industry sectors. The ASX200 closed yesterday’s trading session down 1.23%, with energy and materials weighing down on the market the most.
The market will also be watching NAB’s share price today. The bank released its half-year results this morning and announced it will buy back up to $1.5 billion of its own stock as profit at the lender came in line with expectations. Cash earnings declined 13% to $3.55 billion in the six-month period ending March 31.
Also today, continue to watch Qantas shares following a data breach on the airline’s app yesterday. Qantas passengers were seeing details of other customers on their app, including the name, flight details and loyalty points. QAN declined 1.2% yesterday.
Also watch Woolworths (ASX:WOW) after the supermarket sold down its stake in Endeavour (ASX:EDV). Woolworths may see an uptick today after closing in the red yesterday, after announcing the $468 million Endeavour sell down, which offset a broad market sell-off. Endeavour Groups (ASX:EDV) share price is looking bullish today, so keep watch of Endeavour as well.
The market will also be watching NAB’s share price today when the bank releases its half-year results. Goldman Sachs are expecting the bank to declare an 81cps full franked interim dividend, down 2.4% on last year’s interim dividend.
In commodities,
Oil is trading more than 3.4% lower at US$79 per barrel, the lowest price in over a month as a rebound in US crude stockpiles supported supply of a ceasefire in the Middle East.Gold is trading higher, advancing more than 1.3% to $2,321 per ounce, but remaining near the low levels seen about a month ago, as US traders digest the latest Fed meeting.And iron ore is steady at US$110 per tonne.And in economic news, balance of trade data for March will be released at 12:30pm today.
Trading Ideas:
Bell Potter maintains their Buy rating on Aeris Resources (ASX:AIS), after the multi-mine copper-gold production and exploration company released its March quarterly report. Bell Potter have increased their 12-month price target from $0.23 to $0.30, and at the current stock price of $0.25, this implies 17.6% share price growth in a year.And Trading Central have identified a bearish signal in Sigma Healthcare (ASX:SIG) indicating that the stock price may fall from the close of $1.25 to the range of $1.08 - $1.12 over 35 days, according to the standard principles of technical analysis.To receive more insights and research that is available exclusively to Bell Direct clients, open your Bell Direct account here.

Wall Street tumbled on Tuesday to close out a losing month following the release of the latest inflation related data and ahead of the Fed’s latest interest rate decision out on Wednesday US time. The S&P500 fell 1.57%, the Dow Jones lost 1.5% and the tech-heavy Nasdaq tumbled 2.04%. For the month of April, the three key indices are set to post a notable loss. Higher-than-expected wages data has raised investor concerns of the rate cut outlook out of the Fed. For the first quarter, the employment cost index which measures wages and benefits, climbed 1.2% which was above economists’ expectations of a 1% rise.
Across the European markets overnight, markets closed in the red to record their first negative month since October as investors assessed the latest slew of earnings results. The STOXX600 fell 0.6% on Tuesday, Germany’s DAX lost 1.03%, the French CAC declined 0.99% and, in the UK, the FTSE100 closed Tuesday’s session down just 0.04%. 
 
In Asia overnight, markets closed mostly higher as investors assessed factory activity figures out of China which came in at an expansion to 50.4 in April compared to 50.8 in March which beat economists’ expectations but indicated a slower pace of activity expansion in the world’s second largest economy. Japan’s Nikkei closed flat, Hong Kong’s Hang Seng index rose 0.09%, and South Korea’s Kospi index rose 0.17%.
 
The local market has started the week on a green run, with the key index closing Tuesday’s session up 0.35% led by consumer discretionary and real estate stocks, which are two of the rate sensitive sectors. Lithium miners and explorers got a much-needed boost yesterday on a rise in the price of lithium carbonate, which sent Arcadium Lithium to the top of the ASX200 winners with an 8.4% rise, while IGO rose 7.3% and Liontown Resources added 2.9%.
 
Investors got a boost from Australia’s retail spend data coming out yesterday for March indicating a 0.4% fall in consumer spend, which was well below the 0.2% rise economists were expecting. Retail spend is a key driver of inflation and this reading is a key supporting factor for the RBA to realise some key inflation drivers are easing, which supports the notion to maintain rates at the current level instead of considering another rate hike.
 
Earnings season continues in Australia for the latest quarter which saw investors respond with mixed reactions on Tuesday. Australian fuel supplier and producer Ampol fell 3.3% after reporting a 21% drop in its Lytton Refiner Margin and a 7.3% decline in refinery production over the last three months.
 
What to watch today:
Ahead of the midweek trading session here in Australia the SPI futures are expecting the ASX to open the day down 1.20%, tracking the global sell-off overnight.On the commodities front this morning, oil is down 0.92% at US$81.96/barrel, gold is down 1.61% at US$2295/ounce and iron ore is up 0.35% at US$110.54/tonne.AU$1.00 is buying US$0.65, 102.26 Japanese Yen, 52.05 British Pence and NZ$1.10. 
Trading Idea:
Bell Potter has downgraded Telix Pharmaceuticals (ASX:TLX) from a buy to a hold and maintain a $14.50 price target on the leading cancer imaging and therapy agent pharmaceuticals company following the release of an outstanding 1Q24 revenue growth and a major inflection point approaching for the company through its first therapeutic asset being a crucial piece of the long-term value proposition. The downgrade to a hold is simply due to valuation as the share price has been on a run recently, and this is the first downgrade since Bell Potter first initiated coverage of the company in 2021.

Wall Street opened the new trading week higher as investors prepare for a big week of corporate earnings results and the latest Federal Reserve meeting. The Dow Jones rose 0.38%, the S&P500 added 0.32% and the tech-heavy Nasdaq gained 0.35%. Tesla jumped more than 15% on Monday after overcoming a hurdle for its self-driving technology in China, while Domino’s Pizza gained more than 5% after reporting earnings that beat analysts’ expectations.
 
Across European overnight, markets closed mixed as investors assessed key earnings, company updates and inflation data out in the region. The STOXX600 rose 0.1%, Germany’s DAX fell 0.24%, the French CAC lost 0.29%, and, in the UK, the FTSE100 ended the day up 0.14%. The driver of Germany’s sell-off was the latest preliminary inflation reading coming in at an annual rate of 2.4% for April, which is a 0.6% rise from March and up 2.3% year-on-year. Dutch medical device giant Philips soared 29% on Monday after the company agreed to a $1.1bn settlement in a U.S. case regarding the recall of some of the company’s products that treat sleep apnoea.
 
Across Asia on Monday, markets closed mostly higher as the Japanese yen strengthened and ahead of key economic data out in the region today including China’s official purchasing managers index for April. Japan’s Nikkei rose 0.81% on Monday, Hong Kong’s Hang Seng index rose 0.54%, and China’s CSI 300 rose 1.11%.
 
The local market kicked off the new trading week in positive territory on the back of strong corporate earnings results that impressed investors in addition to taking strong lead from the US rally that ended last week on a high. The ASX200 closed Monday’s session up 0.81% with every sector ending the day in the green. Embattled casino operator Star Entertainment Group (ASX:SGR) rallied over 2% on Monday after the company announced Chairman David Foster has stepped down from his role, with the board appointing board member Anne Ward to replace Mr. Foster as the company looks to overcome recent challenges. Weak annual recurring revenue in Megaport’s (ASX:MP1) latest update led to investors selling out on Monday which sent the share price down over 5%, despite the IT company upgrading FY24 EBITDA guidance. Australia’s retail sales data is out today with the market expecting a 0.2% rise in March from February which would be a slight decline from the 0.3% reported in February and will provide another indicator that inflation is easing as consumer retail spend is a key driver of inflation.
What to watch today:
Ahead of Tuesday’s trading session in Australia the SPI futures are expecting the ASX to open the day up 0.16% tracking global gains overnight.On the commodities front this morning, oil is trading 1.2% lower at US$82.72/barrel, gold is down just 0.08% at US$2335.86/ounce and iron ore is up 0.44% at US$110.16 per tonne.AU$1.00 has strengthened to buyUS$0.66, 102.54 Japanese Yen, 52.36 British Pence and NZ$1.10. 
Trading Ideas:
Bell Potter has maintained a buy rating on Coventry Group (ASXCYG) and raised the 12-month price target on the leading Australian industrial supply and services group after the company announced the acquisition of Steelmasters which is Australia and New Zealand’s third largest specialty fastener distributor, for an upfront cash consideration of NZ$45m. Coventry is funding the acquisition with a fully underwritten $25m two-tranche institutional placement and after receiving strong support from investors, upsized the raising to $30m.Trading Central has identified a bullish signal on Pilbara Minerals (ASX:PLS) following the formation of a pattern over a period of 53-days which is roughly the same amount of time the share price may rise from the close of $3.96 to $5.00 to $5.20 according to standard principles of technical analysis.