Good Evening,

Welcome to the ASX News Daily Recap.

Lost track of what happened on the market today?

Don’t stress. We’re here to catch you up.

Here’s a sample of what you may have missed:

1. 📶 Earnings Reports - AMP, AGL, Boral, Downer & More

2. 💊 A look at the Wegovy Wonder Drug

3. 👗 Cettire's luxurious leap

4. 🔥 Natural Gas heats up

5. 🍔 Wendy's down under!

The Recap

Earnings, Energy, and Eats:

A Triple Threat Recap

Markets kept their head above water for most of the day, with the ASX200 ending Thursday’s session up 0.2% or 19pts to 7,357.4. A busy start to the session, with several companies reporting before the market opened. We have you covered on all the movers today.

One of the more significant stories affecting global markets overnight was the price of European Natural Gas, which jumped by over 30%, sending our Energy (+2.27%) sector higher. Workers at Woodside and Chevron's liquefied natural gas facilities reportedly voted to strike yesterday, with concerns of disruptions sending the price of European Natural Gas higher:

Chevron and Woodside said they are holding talks with unions to avert strikes on gas platforms which supply three Australian liquefied natural gas plants.

Along with the Energy sector, Discretionary (+0.60%) and Healthcare (+0.50%) finished the day in the green, while Tech (-1.79%) was the bigger faller.

Rio Tinto & Djerriwarrh Investments fell by 2.8% & 3.9% respectively today after trading ex-dividend.

Baby Bunting, Charter Hall Social Infrastructure, Newcrest, Nick Scali and REA Group will report to finish the week tomorrow. By our count, we have over 55 companies reporting next week, so stay tuned, the coffee machine is going to be on overdrive!

ASX200 Stock Snapshot

Economic News

We reported yesterday that China’s CPI followed its Producer index into deflation - below is a visual of the steady decline of both indexes:

Wall Street

It was an up and down on the U.S. market, with the S&P500 starting the day as much as 30pts. lower, but then rose to be in the green by the afternoon before giving it all back to end the day down 0.70% to 4,437.7.

The Tech and Energy sectors weighed down the market. One of the 2023 winners, Nvidia, fell by almost 5%, while other giants, Tesla, Apple and Amazon, finished lower.

Oil futures reached an almost nine-month higher as concerns linger that a conflict escalation between Russia and Ukraine may choke off supply.

Walt Disney was the big name that reported earnings after-hours, beating expectations as the stock price rose 3%. The company said it’s raising the prices of its streaming services, with an ad-free subscription costing $13.99 beginning October 12, an increase of $3 per month. Subscribers did fall short of estimates, coming in at 146.1m vs. estimates of 154.8m

U.S. CPI gets reported at 10:30 pm AEST tonight, where economists are forecasting a 3.3% YoY rise for July. June’s CPI rise was 3.0%.

Other Earnings reports:

• Online gaming platform Robolox fell by a staggering 21% after missing estimates in its Q2 earnings report. Avg. Daily Active Users on the platform during the period were 65.5 million, an increase of 25% YoY.

• The Trade Desks stock price sunk in after-hours trade despite posting a 23% revenue rise to US$464.25 million, which was ahead of estimates.

• Wynn Resorts stock rose 2.5% on second-quarter results, topping expectations on the top and bottom lines. Wynn Resorts reported adjusted earnings of 91c p/s on revenue of $1.6 billion.

• Sony fell by as much as 6% on the Tokyo stock exchange after warning not to expect a recovery in the smartphone market until next year.

Sponsor

Are You Intrigued?

Staying informed about the world doesn’t have to be boring.

International Intrigue is a free global affairs briefing created by former diplomats to help the next generation of leaders better understand how geopolitics, business and technology intersect.

Get the most important geopolitical news and analysis in under 5 minutes, a daily briefing that you’ll actually look forward to reading.

Sign Up For Free Today

Markets

Index & Commodity Prices

Bond Prices

ASX By Sector

ETF Watch

Quick Singles

🪃 Local News

• American fast-food chain Wendy’s has secured a deal with global food franchisee Flynn Restaurant Group to build 200 Wendy’s stores in Australia starting in two years.

• Zip Co. will shuffle its C-suite, with current Australia and New Zealand (ANZ) chief executive Cynthia Scott appointed as the new group CEO. Zip co-founders Peter Gray and Larry Diamond will assume the roles of ANZ and U.S. CEOs, respectively.

• The ACCC has told Wesfarmer-owned Australian Pharmaceutical Industries (API) that it does not intend to conduct a public review of the proposed acquisition of Silk Laser Australia. API made a $3.35 per share bid for Silk Laser Australia in April 2023, valuing the company at $179 million.

• AMP Capital reported a statutory net profit of $261 million in H1 FY23, down from $469 million in H1 FY22, which included one-off gains from selling its domestic equities and SuperConcepts businesses. An interim dividend of 2.5c p/s was declared. AMPs platform and investment business saw net profit climb by 25.7% to $44 million. The financial advice business remains a loss maker, losing $25 million.

• AUB Group rose 6.2% after it upgraded FY23 underlying NPAT guidance to approx. $129 million. This result is 5.7% above the mid-point of the FY23 guidance range of $120 million to $124 million, announced on 18 May 2023.

• QBE Insurance fell slightly after reporting H1 FY23 NPAT of $400 million - up from $48 million, driven by investment income of $662 million. QBE saw premium growth of 10.2% in the half, which drove the group’s gross premium growth of 13%. The operating ratio did increase from 94.9% to 98.8%, reflecting “the impact of catastrophe costs which exceeded the first half allowance.”

🌏 Around The Globe

• Amazon is discussing becoming a cornerstone investor in Arm ahead of its IPO. The software and semiconductor company plans to list on the NASDAQ this September and aims to raise $8 billion - $10 billion.

• TikTok’s implementing some new changes for EU users in alignment with the EU Digital Services Act. Users will soon be able to switch off personalisation in the app, meaning their ‘For You’ and ‘LIVE’ recommendations will no longer be based on their activity.

• Coworking company WeWork could be on the verge of bankruptcy after warning yesterday that there was “substantial doubt about our ability to continue as a going concern,”

• U.S. publisher Politico reported that the Federal Trade Commission (FTC) is finalising its long-awaited antitrust lawsuit against Amazon, which could potentially break up parts of the company.

• Netflix quietly released an iOS app called 'Game Controller' that says it allows subscribers to play games on their TVs. Hold your horses, though; the app. states that the feature is still in beta, with no games released on your TV yet.

• U.S. President Joe Biden signed an executive order prohibiting new U.S. investments in China related to sensitive technologies like computer chips.

📧 Know someone who’ll enjoy this content? 📧

Forward them this email so they can subscribe

Deep Dive

Wegovy: The Game-Changing Drug with Dual Benefits

Novo Nordisk's anti-obesity drug, Wegovy, has been making waves, not just for its weight loss capabilities but also for its potential to reduce cardiovascular risks. Recent findings from a late-stage clinical trial revealed that Wegovy could decrease the risk of major cardiovascular events, such as heart attacks and strokes, by an impressive 20%.

This discovery is groundbreaking for several reasons:

• Beyond Weight Loss: Wegovy has shown it could potentially reduce heart disease, which remains the leading cause of death in the U.S. This positions the drug as more than just a solution for those looking to shed pounds but also a potential lifesaver.

• Insurance Implications: The drug's broader health benefits might push U.S. insurance companies to cover this medication. Many insurers have been hesitant to cover Wegovy due to its high cost – over $1,300 per month for weekly injections – and its classification as non-essential to overall health.

• Safety and Tolerance: While the full trial results are yet to be released, Novo Nordisk has indicated that the drug appears safe and well-tolerated, consistent with previous clinical trials.

Before we get ahead of ourselves, the study's results have not been peer-reviewed, and there are concerns about potential side effects, including abdominal pain, nausea, vomiting, and a link to pancreatitis.

Despite the challenges, the drug's potential is undeniable. With nearly half of U.S. adults battling obesity, a condition linked to numerous diseases, Wegovy's dual benefits could mark a significant step forward in public health.

Ischaemic heart disease was Australia's leading single cause of death, responsible for 17,331 deaths in 2021, about one in 10 of the total deaths. Males account for 10,371 (59.8%) deaths compared to 6,960 (40.2%) for females.

Movers and Shakers

✅ Biggest Gainers

• Boral Group was one of the bigger movers on the day, rising by 8.4% to $4.74 after reporting a significant uplift in FY23 earnings. Boral reported an underlying NPAT of $148.1 million, up 304%, which was ahead of expectations. Revenue was $3,460.6 million, up by 17%. Boral increased prices on quarrying products by 11% over the year. Cement prices were up 8%, Concrete 12%, and Asphalt was up 6%. New Chief Executive Vik Bansal said the results “show clear improvement across the entire business”. On a statutory basis, NPAT was $148.1 million for FY23, down against the prior year, which included $977.6 million of post-tax income from profit recognised on the North American Building Products business sale.

• A slowdown in retail spending doesn’t appear to affect online luxury retailer Cettire, who reported a 98% increase in FY23 sales revenue to $416.2 million. This came from $539.2 in gross revenue. Cettire said it increased its active customer base by 63% to 423,000, reporting that it achieved record quarterly net active customer additions in Q4. Cettire went on further to say that they had seen positive momentum into FY24, with sales revenue increasing by approx. 120% in July. “We are pleased by the early trading in FY24, with all our key markets performing strongly,” said CEO Dean Mintz. Cettire ended the day up 12% to $3.14.

🔻Biggest Fallers

• Downer EDI warned that market conditions will remain “challenging” over the next six months after the company reported an annual net loss of $386 million. Downer reported a final dividend of 8c p/s, down from 12c p/s a year earlier. The loss was impacted by $541.5 million (after-tax) of impairment charges primarily relating to goodwill in the utilities and facilities businesses. Underlying NPATA was $174.2m, 18.5% down on FY22. Shares ended the day 6.3% lower to $4.10.

• AGL shares fell by 3.1% to $11.22 after reporting a statutory loss of $1,264 million due to the previously flagged $680 million post-tax impairment charges relating to the carrying value of the Energy Generation Fleet cash-generating unit as it closes its thermal generation assets.

A Little Extra

📉 Going Down?

Top 10 shorted stocks on the ASX - as of 4th of August

1. Core Lithium (CXO) - 11.18%

2. Flight Centre (FLT) - 10.08%

3. IDP Education (IEL) - 9.53%

4. Syrah Resources (SYR) - 8.38%

5. JB Hi-Fi (JBH) - 8.09%

6. Select Harvest (SHV) - 7.84%

7. Pilbara Resources (PLS) - 7.71%

8. Brainchip (BRN) - 7.37%

9. Lake Resources (LKE.) - 7.23%

10. AMA Group (AMA) - 7.17%

📊Broker Ratings

What do the brokers have to say?

• IDP Education (IEL) - Downgraded to Underperform from Neutral (Macquarie)

• Sims (SGM) - Downgraded to Sell from Neutral (UBS)

📅 Economic Calendar

Data to keep an eye on this week

DISCLAIMER: None of the information provided in this newsletter should be constituted as financial advice. This newsletter is strictly for educational purposes only. It should not be taken as investment advice or a solicitation to buy or sell assets or make financial decisions. Please do your research.