ASX Market Wrap: MinRes Hits Transport Troubles

Good Evening,

Welcome to Equity Espresso’s Market Recap. Today, MinRes and Wisetech continue to hog the headlines while a technology CEO sells $67m worth of shares. We don’t say the word tariff plus; we look at whether it pays to be diversified across different geographies. Let’s jump in:

Market Wrap

The S&P/ASX200 index ended Wednesday down 32.1 points (-0.41%), snapping a three-day winning streak as markets experienced a rollercoaster session. After opening lower, stocks staged a midday recovery that briefly pushed the index into positive territory, fading in afternoon trading as selling pressure returned. The decline saw eight of eleven sectors finish in negative territory by the closing bell.

It was a broad-based sell-off, with Utilities (-1.58%), Real Estate (-1.34%), and Industrials (-0.99%) the biggest losers. Health Care (+0.54%) was the standout, thanks to rises from CSL (+1.20%) and Pro Medicus (+0.26%).

Mineral Resources (-4.43%) temporarily suspended haulage on its Onslow road following a WorkSafe WA notice after the sixth jumbo road train crash on its Pilbara iron ore network. This latest incident occurred Monday near the Ken's Bore mine, where two of three trailers rolled and spilled iron ore, with no injuries reported. MinRes says that alternate routes using contractor vehicles are being used to maintain operations, with no impact expected on FY25 guidance. The accident intensifies the scrutiny of the 147-kilometre private road that began operations in October and is crucial for meeting MinRes's iron ore shipment targets. The company previously announced $230 million in repairs for the crumbling road, triggering investor concerns about the viability of the $3 billion Onslow project.

Now, onto the other ASX heavyweight whose CEO may struggle a governance test. Wisetech Global (-2.10%) provided an update on its partial findings of an independent review concerning now Executive Chair Richard White's behaviour, with the findings stating the co-founder made misleading and “not fully transparent” representations about his relationship with two staff members.

Dicker Data (-1.29%) CEO David Dicker offloaded $67.2m worth of shares to fund his final divorce settlement instalment and other personal funding needs. A2 Milk (-2.70%) shares fell on a broker downgrade, while short interest in Dominos (-1.97%) continues to climb. There were 13 companies trading ex-dividend, which you can find here. We take a look at market returns for 2025 so far and why it would have paid to be less exposed to the U.S. and Australia.

Outlook

Wall Street futures for Wednesday’s session are slightly higher for the Nasdaq (+0.14%) and S&P 500 (+0.09%).

It’s a busy evening of economic data tonight. The Eurozone CPI will be reported for February, which is expected to rise 2.4% annually. Meanwhile, the U.S. Federal Reserve will meet to decide on interest rates, which are expected to be held between 4.25% and 4.5%. Locally, we will get employment data for February tomorrow, and the Unemployment rate is expected to remain at 4.1%.

Wall Street

The stock market took a downturn on Tuesday, ending a two-day winning streak. The Dow Jones (-0.62%) fell, while the S&P 500 (-1.07%) dropped by over 1%, bringing it close to correction territory at 8.6% below its February high. The Nasdaq (-1.71%) experienced the largest decline of 1.71%.

Investors were cautious ahead of the Federal Reserve's policy announcement tonight, where interest rates are expected to remain unchanged. Markets anticipate about 60 basis points of cuts this year, though Fed officials have signalled they want to see how President Trump's tariff policies affect economic data before making any changes.

Tesla (-5.34%) shares fell, taking month-to-date losses to 23%, following China’s rival Zeekr's free rollout of an advanced driver-assistance system. RBC Capital Markets lowered its price target amid reduced expectations for Tesla's self-driving pricing. Alphabet (-2.34%) shares slid after Google said that it signed a definitive agreement to acquire cloud security startup Wiz for $32 billion in an all-cash deal.

Economic Data

• Canada’s Inflation jumped to 2.6% in February 2025, up from 1.9% the previous month. This was the highest rate in eight months, sharply above market expectations of 2.2% and ahead of the Bank of Canada's forecast of 2.5%.

• The Bank of Japan (BoJ) kept its key short-term interest rate at around 0.5% during its March meeting, maintaining it at its highest level since 2008 and in line with market expectations.

• U.S. Industrial Production rose by 0.7% in February 2025, the third consecutive month of increases, surpassing market expectations of 0.2%.

• U.S. Housing Starts soared by 11.2% month-over-month to a seasonally adjusted annualised rate of 1.501 million in February 2025, above 1.35 million in January and forecasts of 1.38 million.

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Company Spotlight

❗️ASX Company Announcements

A snapshot of some of the companies out with news today

• Imugene Limited has received FDA Fast Track Designation for azer-cel, its allogeneic CAR T-cell therapy treating relapsed/refractory diffuse large B-cell lymphoma (DLBCL). This status enables expedited development and review, potentially accelerating regulatory timelines.

• WiseTech Global's independent Board Review has found that Co-Founder and Executive Chair Richard White made "inaccurate and incomplete disclosures" concerning personal relationships with a company employee and an individual associated with a supplier. According to findings released by Seyfarth Shaw, Mr. White's representations to the Board were "not fully transparent and candid" and "misleading about personal matters."

• Opthea requested a voluntary suspension of its shares pending the announcement of Phase 3 clinical trial results for its neovascular macular degeneration treatment. Trading of shares will resume either when the results are announced or by Monday morning's market open.

• Imricor Medical Systems shares have been suspended following Monday's trading halt as the company prepares to announce details of a proposed capital raising.

• Webjet Group forecasts stable EBITDA performance through FY25 and FY26 despite planning significant investments, including approximately $15 million in FY26. As its product mix evolves, the company anticipates revenue margins will gradually moderate to 8-9% by FY30. EBITDA margins are expected to compress temporarily during the investment phase before exceeding current levels by FY30.

• Mineral Resources suspended haulage on its Onslow Iron road on Monday after a sixth jumbo train crash near Ken's Bore mine in the Pilbara region. The company is working with WorkSafe WA on risk mitigation while continuing operations via contractor vehicles on alternative routes. No injuries occurred in the latest rollover, which is under internal investigation. MinRes expects to resume normal operations without affecting its 2025 volume guidance.

• Capricorn Metals has closed its remaining 55,000/oz of gold forward sale hedge contracts through a bilateral transaction with Macquarie Bank. This increases the company's exposure to spot market gold prices, currently at record highs.

• Myer reported flat sales of $1.8 billion for the first half of FY25, with its bottom line dropping 40%. Issues at its Ravenhall distribution centre caused $12 million in lost earnings as stock remained trapped and online fulfilment moved to stores. Comparable sales rose just 0.8% amid store closures.

• Dicker Data Chair and CEO David Dicker has sold 8,302,417 shares (4.6% of issued capital) at $8.10 per share. Proceeds will fund Dicker's final divorce settlement payment and address other personal financial requirements.

• Goodman Group has completed its Share Purchase Plan, announced on February 19, 2025. It raised approximately $5.1 million by issuing 152,057 new stapled securities at $33.50 per security.

Headlines

🦘 Local News

• Australia is projected to miss its 2029 housing target by approximately 462,000 homes, according to a new report commissioned by the Property Council of Australia and released on Tuesday.

• Australian Foreign Minister Penny Wong confirmed on Tuesday she had raised concerns with China regarding anonymous letters sent to Melbourne residents offering a HK$1 million ($130,000) reward for information about Kevin Yam, an Australian citizen and Hong Kong pro-democracy activist wanted by Hong Kong authorities for his role in 2019 anti-government protests.

• Meta Platforms will expand its independent fact-checking program in Australia to detect and remove false content and deepfakes before the May national election.

🌎️ Around The Globe

• Amazon plans to cut approximately 14,000 managerial positions by early 2025, representing a 13% reduction in its global management workforce.

• Germany's parliament approved a €500 billion ($548 billion) spending package with 513 votes for and 207 against on Friday. The package is awaiting final approval from the legislative body.

• GM and Nvidia have formed a strategic partnership. The automaker will use Nvidia's A.I. services and products for its next-generation vehicles, driver-assistance systems, and factories.

• Rippling has sued competitor Deel, alleging corporate espionage through an insider at Rippling's Ireland office who accessed confidential information like sales leads and pricing strategies over a thousand times.

• Siemens plans to cut over 6,000 jobs globally, or about 2% of its workforce, due to weak demand and increasing competition from China and within Germany.

• Solana removed a controversial ad titled "America is Back — Time to Accelerate" following significant backlash. The 2-minute, 38-second video featured a character named "America" in therapy for "rational thinking syndrome," with content critics described as pro-Trump, "anti-woke," and mocking gender identity.

🤖 All About AI

• OpenAI is beta testing ChatGPT Connectors, allowing ChatGPT Team users to link their Slack and Google Drive accounts for better-informed responses. Initially available to select users, the feature will expand to platforms like Microsoft SharePoint and Box, enabling ChatGPT to access internal business information.

Deep Dive

Does It Pay To Be
Diversified or Concentrated?

It’s an age-old market question: do you concentrate and let your winners run? Or take profits and prop up your laggards and smooth out volatility. The answer to the question will depend on who you ask.

We wrote a full-length article on the topic, which you can read here.

Diversification can come from many places:

• Sector

• Risk Appetite (Growth vs. Income)

• Geography

• Market Cap

If you look at pure market returns (ignoring the volatility and heartache you would have experienced along the way), it would have paid to be in U.S. equities, particularly Technology. For those real risk-takers, exposure to Bitcoin would have yielded even better returns.

Diversification is often considered a safer, long-term investment strategy. It is recommended for retail investors, pension funds, and institutional investors looking for steady, compounded growth with lower volatility. 

Concentration is favoured by high-conviction investors who believe they can pick superior stocks and outperform the market. Warren Buffett, Charlie Munger, and Carl Icahn supported concentration, arguing that true wealth is built by betting on a few great businesses rather than diversifying into mediocrity.

Diversification across different geographies has paid off so far in 2025. While we focus mostly on Australian and U.S. companies when discussing stock markets, some countries and sectors worldwide have seen strong gains in 2025.

We’ll zoom out now and look at the 10-year performance of each major indices/commodity to see how they’ve performed and where (in hindsight) you should have been invested.

The Takeaway?

If you concentrated in the correct areas (hindsight is 20/20), you made out like a bandit investing in the U.S. Asia showed mixed performance but overall was positive if you avoided China, and Europe significantly lagged the market. Remembering the popular superannuation disclaimer that past performance is not an indicator of future performance. So, where should you be looking for the next 5 years? Here are some of the popular arguments you’ll see written:

• The Contrarian: Europe and China's recent underperformance means they are due to outperform, which we are seeing in 2025 so far. Even in the last few days, China and Germany have announced fiscal stimulus to help boost the economy.

• The bigger gets bigger: U.S. tech continues to grow and provide outsized global returns, helped by the new A.I. wave, which the U.S. is perfectly positioned for. This, coupled with Donald Trump's ‘pro-America’ agenda to raise tariff taxes, cut government spending, and lower income taxes, will result in America outperforming.

• The Money printer: Governments will continue to print excessive money (quantitative easing, fiscal stimulus, etc.), so the purchasing power of fiat currencies will continue to decline. Gold has preserved its value over centuries, acting as a safe haven during high inflation or currency crises. Unlike fiat currencies, which can be printed infinitely, Bitcoin has a fixed supply and is designed to be deflationary.

You can access the full article here.

Brokers

📊 Broker Deep Dive

Following the February 2025 reporting season, SunRice (ASX:SGLLV) has maintained its strategic position amid mixed industry performance. While four peer companies saw EPS upgrades and four experienced downgrades since December 2024, SGLLV's share price declined only 2% compared to the peer group average of 6%.

The company's growth strategy focuses on branded FMCG acquisitions (recently including pet food operator SavourLife) and organic expansion. It is supported by infrastructure capable of handling one million paddy tonnes across two Australian harvests, supplemented by multi-region global sourcing.

Despite projecting strong 11% CAGR EPS growth from FY23 to FY26 and pursuing a 2030 revenue target of $3.0 billion (implying ~8% CAGR growth), SGLLV trades at significant discounts to peers - 25% below average FY25 EV/EBITDA and 48% below average PER. RaaS maintains its DCF valuation at $13.90 per share (representing a $900 million market cap), well above the October 2024 stated Net Tangible Assets of $7.72 per share.

You can access the report below:

Daily Broker Moves

1. Ord Minnett has downgraded a2 Milk Co. to a Hold rating while maintaining its $7.70 target following an 11% price surge driven by Chinese birth stimulus speculation. Despite the stock outperforming the broader market by 60% since February, the broker remains sceptical about long-term birth rate policy impacts.

2. Bell Potter has upgraded Alcidion Group to Buy from Hold while maintaining its 11c target after the company finalised its largest contract to date with North Cumbria Integrated Care NHS Foundation Trust.

Broker Forecasts

1. Fitch Ratings has reduced its U.S. growth forecast to 1.7% for 2025 and 1.5% for 2026, down from previous projections of 2.1% and 1.7%, respectively. The downgrade primarily reflects anticipated inflation increases from the new administration's tariff policies on imports.

Markets

Commodity Prices

Bonds

Forex

Global Health Check

A Little Extra

 ⬇️ Short Data

Top 10 shorted stocks on the ASX - as of March 13

The Insiders

Director buying and selling.
On-market and Off-market trades only.
Net Buy/Sell positions from February 27 - March 17

💵 Dividends

Companies who traded ex-divided today

1. LGI

2. Brisbane Broncos

3. Macmahon Holdings

4. Peet

5. Auckland International Airport

6. Genesis Energy

7. Perenti

8. Helia Group

9. Cti Logistics

10. Enero Group

11. Shriro Holdings

12. Pepper Money

13. Briscoe Group Australasia

The Last Word

DISCLAIMER: Please note that the information provided in this newsletter is for educational purposes only and should not be considered financial advice. It is not intended to encourage you to buy/sell assets or make economic decisions. We strongly recommend conducting your own research before making any investment.