Afternoon Report / Early joy fades (MYR)

By Market Matters 10 September 20

Early joy fades (MYR)

Market Matters Afternoon Report 10th September 2020


WHAT MATTERED TODAY

The session started with plenty of optimism as the index rode the buy the dip mentality seen overseas at the open. Early on the index reached 5955, or 77pts higher than the previous close on the back of broad buying. From there though it was largely one way with the gains handed back by around 3PM. Some buying was seen into the close but for the most part it was a disappointing turn out for local stocks after the positive signs early which closed nearly 50pts from the day’s high. Within the move today the selloff in the banks was probably most disappointing from an MM perspective. Without the big 4 the index will struggle. REITs were the weakest sector with those exposed to retail continuing to feel the weight of selling. Tech was best – unsurprising given it was the focus of buying overnight, and Nasdaq futures remained supported today. Materials were supported on iron ore stocks with Citi bank calling for the commodity to hold above $US100 in the short term.

Attention turns to jobless claims and PPI data out of the US tonight as the market looks for further indications of the recovery that is underway.

By the close, the ASX 200 was up 29pts / +0.51% to 5908.

Charts unavailable today due to technical issues.

CATHCING MY EYE

Myer (MYR) -17.65%: the fall from grace continues for Myer which today posted a $172m loss for FY20 as COVID, and an outdated business model took its toll. Sales fell ~15% as store closures being blamed for the bulk. As with all retailers, online was the strength posting 61% sales growth. Comparable same store sales fell 3.3% while margins also eased by 85bps. Retail has had a strange reporting season with quality models with a good online offering doing well while store focussed plays have clearly felt the brunt of COVID shutdowns. The development of Myer over the last few years will have to continue as it shifts away from onerous leases, poor layout and offering if it wants to survive the different retail world going forward.

BROKER MOVES 

·         PointsBet Raised to Neutral at Credit Suisse; PT A$10.50

·         Woodside Raised to Add at Morgans Financial Limited; PT A$23.40

·         Appen Raised to Neutral at Credit Suisse; PT A$30

·         Technology One Raised to Add at Morgans Financial Limited

·         AUB Group Rated New Positive at Evans & Partners Pty Ltd

·         Steadfast Rated New Positive at Evans & Partners Pty Ltd

OUR CALLS

No changes to the portfolios today.

Major Movers Today

Have a great night

James, Harry & the Market Matters Team

Disclosure

Market Matters may hold stocks mentioned in this report. Subscribers can view a full list of holdings on the website by clicking here. Positions are updated each Friday, or after the session when positions are traded.

Disclaimer

All figures contained from sources believed to be accurate.  All prices stated are based on the last close price at the time of writing unless otherwise noted. Market Matters does not make any representation of warranty as to the accuracy of the figures or prices and disclaims any liability resulting from any inaccuracy. 

Reports and other documents published on this website and email (‘Reports’) are authored by Market Matters and the reports represent the views of Market Matters. The Market Matters Report is based on technical analysis of companies, commodities and the market in general. Technical analysis focuses on interpreting charts and other data to determine what the market sentiment about a particular financial product is, or will be. Unlike fundamental analysis, it does not involve a detailed review of the company’s financial position.

The Reports contain general, as opposed to personal, advice. That means they are prepared for multiple distributions without consideration of your investment objectives, financial situation and needs (‘Personal Circumstances’). Accordingly, any advice given is not a recommendation that a particular course of action is suitable for you and the advice is therefore not to be acted on as investment advice. You must assess whether or not any advice is appropriate for your Personal Circumstances before making any investment decisions. You can either make this assessment yourself, or if you require a personal recommendation, you can seek the assistance of a financial advisor.  Market Matters or its author(s) accepts no responsibility for any losses or damages resulting from decisions made from or because of information within this publication. Investing and trading in financial products are always risky, so you should do your own research before buying or selling a financial product.

The Reports are published by Market Matters in good faith based on the facts known to it at the time of their preparation and do not purport to contain all relevant information with respect to the financial products to which they relate. Although the Reports are based on information obtained from sources believed to be reliable, Market Matters does not make any representation or warranty that they are accurate, complete or up to date and Market Matters accepts no obligation to correct or update the information or opinions in the Reports. Market Matters may publish content sourced from external content providers.

If you rely on a Report, you do so at your own risk. Past performance is not an indication of future performance. Any projections are estimates only and may not be realised in the future. Except to the extent that liability under any law cannot be excluded, Market Matters disclaims liability for all loss or damage arising as a result of any opinion, advice, recommendation, representation or information expressly or impliedly published in or in relation to this report notwithstanding any error or omission including negligence.