☕️ ASX Flirts with All-Time High - REA's UK Gamble

Good Evening,

Welcome to Equity Espresso’s Market Recap.

The Australian share market edged higher on Monday, closing just shy of its record high, as gains in banking stocks counterbalanced losses in the Mining sector. The S&P/ASX 200 ended 0.2% higher at 8,109.9 points, with major banks driving the increase.

This upward movement in banking stocks was influenced by indications that interest rate cuts may be imminent in the United States. Data released over the weekend showed that the personal consumption expenditures price index, the U.S. Federal Reserve's preferred measure of inflation, rose by 0.2% in July, suggesting a potential monetary policy easing soon.

The Financials (+1.14%) was the best performer of the seven sectors to finish higher, with Commonwealth Bank (+1.63%), National Australia Bank (+1.26%), ANZ (+0.86%), and Westpac (+1.15%) all closing higher. Energy (+1.10%) stocks were amongst the best performers, as Woodside (+1.40%) and Santos (+1.11%) also contributed to the positive performance.

Corporate Earnings

• Bellevue Gold (-9.09%) reported its first annual profit of $75 million after starting production at its WA mine. The company generated $41 million in free cash flow in Q2 2024, producing 42,705 ounces of gold. Bellevue plans to increase production to 250,000 ounces annually by FY28.

• Imugene's (+9.68%) shares rose after the company reported promising results from a cancer treatment trial. The company's Phase 1b trial showed complete responses in two patients with relapsed/refractory diffuse large B cell lymphoma.

• REA Group (-5.28%) shares fell after the company confirmed reports that it is exploring a potential acquisition of Rightmove, the UK's leading property platform, for over $9 billion. Rightmove's stock surged 23% in early trade on the London Stock Exchange.

• Woolworths Group (+0.39%) is selling its remaining 4.1% stake in Endeavour Group through a block trade at $5.23 per share, generating $383 million. The proceeds will be used to acquire the outstanding 35% of PFD Food Services Pty Limited.

• Star Entertainment Group shares were suspended from trading today because they did not publish their full-year results last week.

Wall Street

Wall Street stocks rose on Friday, with the Dow Jones (+0.55%) achieving its second consecutive all-time closing high. The NASDAQ (+1.13%) led gains, boosted by Tesla (+3.80%) and Amazon, while the S&P 500 (+1.01%) also advanced.

The positive momentum was fueled by fresh U.S. economic data that strengthened expectations of a modest interest rate cut by the Federal Reserve in September. U.S. consumer spending showed solid growth in July, indicating financial strength alongside moderate price increases.

According to CME Group's FedWatch Tool, money markets now suggest a 70% chance of a 25 basis point rate cut in September, with the probability of a larger 50 basis point cut decreasing to 30% following Friday's data release.

S&P500 Sector Performance

Economic Data

• China General Manufacturing PMI rose to 50.4 in August 2024 from 49.8 in July, above market forecasts of 50.0.

• Indonesia's annual inflation rate was 2.12% in August 2024, matching market expectations and staying within the central bank's target range of 1.5 to 3.5%.

• U.S. Core PCE prices rose by 0.2% from July 2024, in line with market expectations and consistent with the 0.2% increase in June.

Sponsor

The Rising Demand for Whiskey: A Smart Investor’s Choice

Why are 250,000 Vinovest customers investing in whiskey?

In a word - consumption.

Global alcohol consumption is on the rise, with projections hitting new peaks by 2028. Whiskey, in particular, is experiencing significant growth, with the number of US craft distilleries quadrupling in the past decade. Younger generations are moving from beer to cocktails, boosting whiskey's popularity.

That’s not all.

Whiskey's tangible nature, market resilience, and Vinovest’s strategic approach make whiskey a smart addition to any diversified portfolio.

Schedule a call with a Vinovest advisor to learn more.

Quick Singles

🌎️ Around The Globe

• Apple is partnering with Bharti Airtel, India's second-largest telecom, to boost its content services. The deal offers free music and video streaming to many of Airtel's 281 million customers, potentially significantly expanding Apple TV+ and Apple Music's user base.

• A Blackstone-led consortium, including the Canada Pension Plan Investment Board, is close to acquiring Australian data centre company AirTrunk for A$20 billion.

• China has threatened severe economic retaliation against Japan if it restricts chipmaking equipment sales to Chinese firms. This complicates U.S. efforts to limit China's technology access and raises concerns about potential Chinese restrictions on critical minerals for Japan's automotive industry.

• Disney and DirecTV failed to renew their distribution agreement, resulting in over 11 million DirecTV subscribers losing access to ESPN, ABC, and other Disney-owned networks.

• Intel's CEO Pat Gelsinger and top executives are preparing to present a restructuring plan to the board to streamline operations and revise capital expenditure. The strategy includes potentially selling off non-core businesses like the Altera programmable chip unit to reduce costs and refocus the company's resources on core operations.

• Yelp has filed an antitrust lawsuit against Google, alleging the tech giant abuses its monopoly in search to dominate local search and advertising markets. Following a recent federal ruling against Google's search practices, the lawsuit claims that Google manipulates search results to favour its local offerings over competitors like Yelp.

Markets

ASX Company Movers

Commodity Prices

Bonds

Forex

Global Health Check

ETF Prices

🔍️ ETF Watch

Want to see how one of your ETFs compares to the rest?

Reply to this e-mail and tell us an ETF or two you want to be included in the tables below.

Australian Index

Australian Sectors

Global Indices & Sectors

Global Strategy

Property & Infrastructure

Fixed Income

Mixed Assets

*1-year, 3-year and 5-year returns are calculated as of July 31 2024.

The Last Word

How are we doing?

We always love hearing from our readers and are constantly seeking feedback.

• How are we doing with Equity Espresso?

• Is there anything you’d like to see more of or less of?

• Which aspects of the newsletter do you enjoy the most?

Hit reply and say hello - or leave us feedback in the poll below:

If you enjoyed this newsletter, forward this e-mail to a friend.

If you’re that friend, subscribe here.

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 research before making any investment.