ASX Brushes off High Inflation

Markets bounced on Friday, gaining back some of the losses of Thursday after the higher-than-expected inflation report. The ASX200 finished the day 25.50 pts, or 0.34% higher to end another positive week at 7,493.80 pts. The ASX200 ended the week 0.79% higher and is up 6.79% so far in 2023.

Energy stocks were the biggest laggards on Friday, with the sector down 1.8 per cent on the day with coal stocks leading losers. New Hope (ASX:NHC) fell by 9.0 per cent to $5.84, and Whitehaven dropped by 6.6 per cent to close at $8.44.

There were 8 of the 11 sectors which ended the day in the green. The Consumer Staples sector was the best performer, increasing by 1.23%, followed by Tech which rose by 1.2%. On the other side of the coin was Energy which fell by 1.84%, followed by the Health Care sector which dropped by 0.27%

Megaport and Liontown Resources were the best-performing companies on the index, increasing in value by 7.22% and 5.19% respectively.

Quick Singles

• ResMed (ASX: RMD) reported a 16% increase in revenue alongside strong earnings growth in the United States and the expansion of its business model into Germany. Shares ended the day 2% higher closing the week at $33.65.

• High inflation hasn't deterred investors from piling back into risk-on assets, with Bitcoin rising above US$23,000. Bitcoin is now up almost 40% in the last months. Ethereum has also followed suit, increasing by 34% in the last month to trade at just over $1,600.

• Tesla shares rose by more than 10 per cent on Thursday after the EV car company released Q4 and FY22 earnings in after-hours trading on Wednesday. Tesla shares by a further 12% on Friday to end the week at US$177.58

US Economic News

In the week ending January 21st, the number of Americans submitting new claims for unemployment benefits decreased by 6,000 from the previous week's downwardly revised total to 186,000, the lowest amount since April and much below the forecasted 205,000.

The cost of orders received by US manufacturers of goods intended to last at least three years, known as durable goods orders, increased 5.6 per cent month over month in December 2022.

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Top Story

Fortescue shipments rise in Q2

Fortescue Metals Group (ASX: FMG) ended the week strongly following the release of its second-quarter and first-half production update. Fortescue reported that it delivered 49.4 million tonnes of iron ore in the three months ending December 31. This contributed to a 4% increase in half-year shipments to a new high of 96.9 million tonnes.

This was done at a cost of US$17.17 per wet metric tonne in the second quarter of C1 (wmt). Whilst this was up 12% year on year, it was a 3% improvement over the first-quarter figure of US$17.69 per wmt. For the quarter, Fortescue charged an average of US$86.93 per dry metric tonne (dmt), representing an 88% discount to the benchmark 62% fines iron ore price.

While no earnings figures were provided in the update, Fortescue revealed that its cash balance increased by US$700 million to US$4 billion during the quarter. Fortescue shares traded flat on the day, closing at $22.49.

Movers and Shakers

✅Biggest Winners

Origin Energy Ltd. (ASX: ORG) share price was up 0.7% to $7.37 after providing the market with an earnings outlook. Origin said that it expects Energy Markets EBITDA to be in the range of $600 million and $730 million, excluding for any impacts from the introduction of the legalised coal cap. This earnings guidance is higher than the previous guidance of between $500 million to $650 million.

Tyro Payments Ltd (ASX: TYR) share price increased by 4% to $1.56 following the news that Tyro has offered Potentia access to conduct due diligence as part of a takeover offer This follows a potential recent non-binding takeover offer of $1.60 per share. Despite the fact that this offer was rejected, Tyro appears to be anticipating a better offer.

❌ Biggest Losers 

Newcrest Mining Ltd (ASX: NCM) fell 2.3% to $22.42 per share. Whilst there was no news from the company, the drop may have been caused by a broker update from UBS. In the update, UBS said that the gold miner's quarterly update did not particularly impress its analysts. As a result, the broker has reduced its earnings forecasts and valuation. UBS has maintained its neutral rating but lowered its price target to $21.00.

Clean Seas Seafood (ASX:CSS) reported half-year sales revenue of A$34.2 million, a 10% increase from FY22 which sent the company's share price down by 3.3% to $0.59. In H1 FY23, Clean Seas sold a staggering 1,526t of Kingfish at an average price of A$22.43/kg, resulting in an 11% increase in farmgate revenue to A$26.9 million from A$24.3 million in H1 FY22.

Small-Cap of the Day

Dreadnought Expansion

At its Mangaroon project in Western Australia, Dreadnought (ASX:DRE) has expanded the current strike of the Yin Rare Earth Element (REE) Ironstone Complex by approximately 30 per cent, bringing the total distance to around 43 kilometres.

Beginning in February or March of 2023, drilling will get underway on both the Yin Ironstone Complex and the C1-7 carbonatites. Dreadnought shares rose by 17% to $0.11 on Friday after the news

That's it from the team at ASX-News today. We hope you enjoyed our EOD wrap-up. Good night and happy investing!