Market Open Lower as Traders Eye Q4 GDP Figures

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Welcome to Equity Espresso’s Daily Recap. 

The ASX started the new week on the back foot, despite beginning the day positively, with the ASX 200 index losing 9.8 pts. or 0.13% to finish at 7,735.80. Investors’ focus will turn to GDP data for Q4, which is set to be released on Wednesday and is expected to climb 1.5% YoY. An expected dip in business activity has added concerns that the GDP figure could fall short of estimates. Data from the ABS showed that inventories had declined 1.7% QoQ - the largest fall on record.

Seven sectors ended the day lower on the market today, with Health Care (-0.78%), Utilities (-0.77%), and Materials (-0.72%) the biggest fallers. Real Estate (+1.34%) and Technology (+0.92%). Goodman Group (+2.33%) continues to lead the REIT sector higher, while in the Technology sector, Wisetech Global (+1.39%) hit another all-time high share price, and Life360 (+7.52%) had another bumper session after a 38% spike on Friday.

In company news, Downer EDI (-1.20%) has responded to the pending shareholder class action by partly blaming KPMG for the accounting irregularities. Genex Power (+32.4%) soared to $0.24 after Japanese energy company J-Power made a $375 million bid to buy the Queensland-based renewables developer. Lake Resources (-11.1%) stock fell as it revealed plans to cut 50% of its non-core staff as the lithium miner battles with falling commodity prices of the battery metal. Cettire (-4.8%) shares dropped after founder and CEO Dean Mintz sold down 7.2% of the company.

The ABS said that Corporate Profits in Australia increased by 7.4% QoQ in Q4 of 2023, easily beating market estimates of +1.8% and shifting from a 1.6% fall in Q3. It was the strongest growth since Q1 of 2022, with profits rebounding for Miners (17.3% vs -7.5% in Q3),

Gold prices held their ground on Monday, trading at around US$2,080/oz after a 2% gain on Friday, underpinned by a decline in the U.S. dollar and treasury yields. Bitcoin rose for the second straight day to trade at around US$63,500, marching ever closer to its record high, driven by expectations of continued inflows into exchange-traded funds.

Wall Street

U.S. stocks finished higher on Friday, with the S&P 500 (+0.80%) and Nasdaq (+1.14%) closing at record highs, as technology stocks continued their positive rally on continued enthusiasm for artificial intelligence as Nvidia (+4.00%) notched another all-time high.

Hewlett Packard Enterprise stock rose 2.1% after reporting first-quarter earnings of 3 cents per share, beating analysts’ expectations. The technology company reported $6.76 billion in revenue, below forecasts of $7.11 billion. Dell Technologies stock rocketed more than 31% after posting fourth-quarter results that beat analysts’ estimates amid solid demand for its artificial intelligence servers.

Economic Data

• Australian Job Advertisements fell by 2.8% month-on-month in February after rising by 3.4% last month. It was the first drop in job ads since November 23, amid signs that the labour market is loosening as high borrowing costs slow the economy.

• Australian Dwelling Approvals fell by 1% month-on-month to 12,850 units on January 24, an improvement from the 9.5% drop in December but was well below the 4.0% gain expected.

• U.S. ISM Manufacturing PMI fell to 47.8 in February from 49.1 in January, below market expectations of 49.5, marking the 16th consecutive period of declines in manufacturing activity.

• Euro Area Consumer Price Inflation dropped to 2.6% year-on-year in February, down from 2.8% in January but remaining slightly above market expectations of 2.5%.

• Brazilian Gross Domestic Product was flat in Q4 of 2023, the same was Q3 which also reflected a stall. The latest quarter’s result was below expectations of a 0.1% increase.

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Quick Singles

🌎️ Around The Globe

• Elon Musk is suing ChatGPT-maker OpenAI and its CEO, Sam Altman, saying they abandoned the startup's original mission to develop artificial intelligence for the benefit of humanity and not for profit.

• Boeing is in talks to repurchase Spirit AeroSystems, a fuselage manufacturer it spun off in 2005. Spirit AeroSystems is connected to many of the recent issues with Boeing Max 737 planes.

• Oprah Winfrey is leaving WeightWatchers after almost ten years on the board. In December, she announced she added a weight-loss medication to her routine. The struggling company's shares fell over 18% due to competition from drugs like Wegovy and Ozempic.

• Blackrock spot bitcoin ETF, ‘IBIT’, hit $10 billion in assets Friday, hitting that milestone faster than any exchange-traded fund. The ETF hit the mark seven weeks after launching on January 11, hitting over $600 million in a single day alone last Thursday.

• Mark Zuckerberg, currently on a tour of Asia, is actively seeking collaborations with prominent tech leaders, including Samsung, to boost the development of AI chips.

• Japan's leading stock market benchmark reached a new high of 40,000 points on Monday, driven by corporate governance reform and attractive valuations.

• VanEck plans to launch a bitcoin exchange-traded fund on the ASX pending approval from regulatory authorities. The move follows increased interest after the U.S. SEC approved spot bitcoin ETFs.

   

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A Little Extra

📉 Going Down?

Top-10 shorted stocks on the ASX - as of February 27

🗂️ Broker Ratings

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