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Welcome to Equity Espresso’s Daily Recap. 

The Australian share market had a late afternoon rally after spending the morning in the red, climbing for the fourth straight session with the ASX 200 index closing 10.2 pts. or 0.13% higher to 7,663.0.

It was a mixed day from a sector standpoint, with Consumer Staples (+2.15%) the biggest positive mover, with Coles (+5.8%) shares rallying after reporting a 3.7% lift in first-half sales to $22.27 billion. The Technology (+1.26%) sector was another to move higher as WiseTech’s (+7.00%) stellar run continues notching up an all-time share price today after it reported positive earnings last week. The Real Estate (-0.77%) and Utilities (-0.74%) fell the most of the five sectors to end in red.

Iron Ore prices continue to fall, with Singapore futures dropping by over 3.0% to four-month lows of US$119.50/t. Aussie miners seemed unaffected as BHP Group (+0.16%) and Rio Tinto (+0.45%) both rose while Fortescue (-1.19%) dropped slightly. The gold price continues to waver, currently trading at just over US$2,030. Bitcoin prices hit a two-year high on Tuesday, crossing US$57,000 on signs of heavy institutional buying. Ethereum also hit a two-year high of US$3,200 today.

In company news:

• Reece (+18.31%) was the best performer on the ASX200, hitting an all-time high share price of $28.50. The building and bathroom supplies company increased profits in the first half by $24% to $224 million, despite only a 2.5% lift in revenue to $4.53 billion.

• Coles Group (+5.5%) reported an 8.4% fall in first-half profit to $589 million as sales increased by 3.7% to $22.27 billion. Supermarket revenue increased by 4.9%, but margins contracted to 5.1% from 5.3% a year earlier.

• G8 Education (+11.6%) increased full-year profits to $56.1 million from $36.6 million a year earlier, thanks to a revenue lift. Occupancy levels for the year were 70.2% - slightly down from 70.4%.

• Woodside Energy (+0.9%) shares rose slightly after underlying net profit fell to US$3.32 billion in 2023 from US$5.23 billion in the prior year, dragged down by lower prices across all products.

• City Chic (-11.6%) shares fell after reporting a four-fold loss increase to $21 million during the first half of FY24, declaring an underlying EBITDA loss of $7.5 million.

• ZIP Co. (-14.4%) fell despite turning around losses from last year to deliver a Net Profit of $73 million during the first half of the fiscal year. Transaction volumes were up to 10% to $5 billion as the number of merchants accepting Zip as payment climbed to 76,200.

Wall Street

U.S. stocks ended Monday slightly lower as investors turned an eye to a busy week of economic data that could shape the Federal Reserve's decision-making about interest rate cuts. One of the vital data points includes January's personal consumption expenditures price index, which is seen as a gauge of inflation. The S&P 500 lost 19.27 pts, or 0.38%, to finish at 5,069.53, while the Nasdaq lost 20.57 pts, or 0.13%, to 15,976.25.

In company news, Berkshire Hathaway’s Class B shares fell slightly after it reported a 17% jump in operating earnings to $37.35 billion. Berkshire holds $167.6 billion in cash at the end of the fourth quarter.

Economic Data

• Japan’s Annual Inflation Rate fell to 2.2% during January - down from 2.6% in December, the lowest point since March 2022.

• Japan’s Core Annual Inflation rose to 2.0% in January from a 2.3% gain in December, the lowest mark since March 2022.

• U.S. New Home Sales rose 1.5% to 661,000 during January, missing market expectations of 680,000

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Quick Singles

🌎️ Around The Globe

• Chinese state-owned planemaker COMAC will conduct flying displays of its C919 and ARJ21 jets in five Southeast Asian countries as it looks to lay the groundwork for future international sales.

• Hackers working for the 'Blackcat' ransomware gang were behind UnitedHealth's outage in their technology unit, which has delayed prescription deliveries for six days.

• Accounting service company H&R Block has been accused of deceptive marketing tactics by the U.S. regulator, including making it unreasonably difficult to downgrade services.

• AT&T will issue a $5.00 credit to “potentially impacted” wireless customers following a 12-hour network outage that left customers without service last Thursday.

• BYD is taking luxury EVs to new levels with its Yangwang U9, which it introduced Sunday with a sticker price of $233,450.

• JPMorgan Chase chief executive Jamie Dimon sold 821,778 shares in the bank, valued at around $150 million.

• HMD, the maker of Nokia phones, is partnering with Mattel to create a retro-style Barbie flip phone.

• Tyler Perry revealed he halted an $800 million studio expansion after seeing OpenAI’s Sora, predicting job losses in the entertainment sector with the advancements in AI.

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A Little Extra

📉 Going Down?

Top-10 shorted stocks on the ASX - as of February 21

🗂️ Broker Ratings

1. Adairs (ADH) - Upgrade to Add from Hold (Morgans)

2. Michael Hill (MHJ) - Upgrade to Buy from Neutral (Citi)

3. Pilbara Minerals (PLS) - Downgrade to Sell from Neutral (Citi)

4. PeopleIN (PPE) - Downgrade to Hold from Add (Morgans)

5. Suncorp Group (SUN) - Downgrade to Neutral from Buy (Citi)

6. TPG Telecom (TPG) - Downgrade to Neutral from Outperform (Macquarie)

7. TPG Telecom (TPG) - Downgrade to Hold from Add (Morgans)

8. Waypoint REIT (WPR) - Downgrade to Hold from Add (Morgans)

👨‍💼 Director Transactions

What are the insiders doing? (On-market trade only)

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 financial decisions. We strongly recommend conducting your own research before making any investment decisions.