Overseas Market Report – U.S. Stocks Finish Higher after Crude Jumps
U.S. stocks finished higher on Thursday, with the Dow rising for the fifth straight session to close in positive territory for 2016 for the first time this year.
The energy, materials and industrials sectors rose sharply, helped by soaring commodity prices. Crude-oil futures jumped above US$40 a barrel for the first time since 3 December, aided by hopes over reducing of output and a sharp drop in the U.S. dollar.
Initial U.S. unemployment claims rose by a smaller-than-expected 7,000 last week to 265,000. The four-week moving average rose by 750 to 268,000. Separately, the Labor Department said the number of jobs openings rose to a seasonally adjusted 5.54 million in January from 5.28 million in December.
The Philly Fed Index, which measures the strength of the Mid-Atlantic manufacturing sector, rose to 2.8 in March from -12.4 in February. Any reading over zero indicates an expansion, and this is the first positive reading in seven months.
At close the Dow was up 0.9%, the S&P 500 was up 0.7%, while the NASDAQ had lifted 0.2%.
For Australian ADRs listed on the NYSE, BHP Billiton rose 129 cents (4.96%) to $27.29, ResMed fell 130 cents (-2.27%) to $56.00, Telstra Corporation gained 17 cents (0.85%) to $20.18, Spark New Zealand rose 22 cents (1.95%) to $11.53 and Westpac gained 36 cents (1.45%) to $25.20.
At 8:00 AM (AEDT), the 10-year Treasury note yield was 1.90% and the 5-year yield was 1.37%.
Better-than-expected results and upbeat guidance sent shares of FedEx (FDX) up over 11%. The firm's earnings of US$2.51 per share were above the US$2.35 expected by analysts and revenue was also above views.
Shares of Williams-Sonoma (WSM) were down after the firm's fourth quarter marked the first time brand comps had fallen short of guidance since the recession. However, despite only capturing modestly positive brand comps, the firm was still able to drive earnings growth thanks to a disciplined cost structure and a stellar marketing strategy.
European markets were mixed Thursday.
The FTSE 100 was up 0.4%, while the French CAC 40 was down 0.5% and Germany's DAX was 0.9% lower.
Asian shares were also mixed.
The Shanghai Composite and Hang Seng each rose 1.2%, while the Nikkei 225 was off 0.2%. India's Sensex was flat.
Australian Market Report- Local Market Expected To Open Higher
Ahead of the local open, SPI futures were 24 points higher at 5,194.
Thursday 17 March – close. The Australian market opened higher, following the US Federal Reserve's decision to leave its rates unchanged. Shares traded consistently above the flat line, with the big four banks and miners leading the rally. Most sectors performed positively, with the exception of health care and telecommunication services. The Australian dollar appreciated against most major currencies.
The All Ordinaries added 50.70 points to 5,226.40 while the S&P/ASX 200 lifted 49.20 points to 5,168.20.
In This Issue
Argonaut Research | Northern Star (NST) | SELL
Northern Star (NST) provided an update on its Kanowna Belle (KB) operation, including drill results from Velvet, Millennium and other regional prospects. The outstanding results from Velvet enhance probability for it to be included in the mine plan, supporting KB’s ~125koz pa production profile from FY18 onwards. The drilling results from Velvet and other targets, including Millennium, Paradigm, White Feather and Six Mile continue to highlight the prospectively of NST’s tenements and the Company’s ability to deliver organic growth.
Myer Holdings (MYR)
Myer Holdings announced its results for the 26 weeks to 23 January 2016. Sales grew by 1.8% to $1,794.8m, up 3.3% on a comparable stores sales basis, driven by the wanted brands and enhanced service strategies. Operating gross profit was $694.1m with margin 187 basis points lower to 38.7%. NPAT was down 4.0% to $59.7m. Net operating cash flows improved by $19m as a result of effective working capital management including increased payables of $54m offset by higher inventory. The Board has determined an interim dividend of 2.0 cps fully franked to be paid on 5 May 2016 and record date is 29 March 2016. In 1H2016, capital expenditure was $27.8m compared to $47.6m in 1H2015 which included net cash capex of $10.0m spent on new stores. MYR soared 14 cents to $1.24.
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