The ASX stocks the big brokers upgraded to buy this week, plus those they think have the most upside
Wed 31 Jul 24, 2:18pm (AEST)
Home
/
News
Market Wraps
/Evening Wrap: ASX 200 soars as August RBA rate hike evaporates into a haze of buying across tech, energy, and resources stocks
News
Market Wraps
/Evening Wrap: ASX 200 soars as August RBA rate hike evaporates into a haze of buying across tech, energy, and resources stocks
Market Wraps
Evening Wrap: ASX 200 soars as August RBA rate hike evaporates into a haze of buying across tech, energy, and resources stocks
Wed 31 Jul 24, 5:36pm (AEDT)
Stocks in article
The S&P/ASX 200 closed 139.1 points higher, up 1.75%.
The S&P/ASX 200 rose one hundred and thirty-nine point five points today.
It was so good I had to spelt it out.
I don't need to spell out to you just how important today's June CPI data was in sparking the celebrations. 0.2% quarter on quarter. That's the difference between the +0.8% quarterly change in prices across the Australian economy the CPI reflects, and the +1.0% change economist were forecasting.
Ecstasy and agony are often defined by very small margins in the stock market! I, and I'm sure you, don't care what the margin was...we will gladly take today's win!
Even better, if the technicals of today's session are anything to go by – i.e., a long white candle closing smack-bang on the high of the session, a record high close, as well as market breadth in the broader-based S&P/ASX 300 showing a near-unanimous 262 to 18 gainers versus decliners – in theory there should be plenty more wins to come. 🤔
It just doesn't get any better...and on that cheery note...
Let's dive in!
Today in Review
Wed 31 Jul 24, 4:32pm (AEST)
Enjoying the Evening Wrap? Sign up to get it sent directly to your inbox after every trading day.
Markets
ASX 200 Session Chart
The S&P/ASX 200 (XJO) finished 139.1 points higher at 8,092.3, 1.75% from its session low and smack-bang on its session high. In the broader-based S&P/ASX 300 (XKO), advancers beat decliners by a near-unanimous 262 to 18.
Both aspects are important because broad-based moves that close at the high of the session are more likely to be sustainable.
All 11 of the major ASX sectors were up today, and most of those sported gains in excess of the XJO’s 1.75%. The Information Technology (XIJ) (+2.5%) was the best performing sector today, it’s a high growth-high PE sector. It’s been suffering lately under the weight of a rotation out of these types of stocks in the US, and the prospect of higher interest rates locally. High PE stocks are discounted more punitively when rates go up – so today’s move demonstrates a great sigh of relief that the CPI data shouldn’t rile the RBA at its meeting next week.
Consumer Discretionary (XDJ) (+2.3%), Communication Services (XTJ) (+1.9%) are two other high-PE sectors, and the XDJ has obvious reasons to rejoice a lower likelihood of the RBA increasing rates again. Real Estate Investment Trusts (XPJ) (+1.9%) are the other key group of ASX stocks that rejoice in lower market rates (they’re usually big balls of debt!).
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
|---|---|---|---|---|---|
Appen (APX) | $0.750 | +$0.08 | +11.9% | +61.3% | -62.3% |
Charter Hall Group (CHC) | $12.68 | +$0.82 | +6.9% | +16.3% | +11.1% |
Kogan.Com (KGN) | $4.52 | +$0.28 | +6.6% | +7.1% | -28.8% |
Seek (SEK) | $21.97 | +$1.19 | +5.7% | +5.0% | -11.0% |
Harvey Norman (HVN) | $4.79 | +$0.24 | +5.3% | +14.6% | +27.1% |
Technology One (TNE) | $20.58 | +$1.01 | +5.2% | +12.4% | +29.4% |
GPT Group (GPT) | $4.63 | +$0.21 | +4.8% | +16.3% | +6.9% |
Nick Scali (NCK) | $15.69 | +$0.71 | +4.7% | +18.1% | +51.0% |
Data#3 (DTL) | $8.82 | +$0.39 | +4.6% | +6.8% | +17.9% |
Nuix (NXL) | $3.45 | +$0.15 | +4.5% | +12.7% | +128.5% |
JB HI-FI (JBH) | $69.65 | +$2.89 | +4.3% | +13.7% | +52.7% |
Homeco Daily Needs Reit (HDN) | $1.270 | +$0.045 | +3.7% | +9.0% | +5.4% |
Lovisa (LOV) | $34.94 | +$1.22 | +3.6% | +13.7% | +66.3% |
Stockland (SGP) | $4.60 | +$0.16 | +3.6% | +10.3% | +9.3% |
Adairs (ADH) | $2.19 | +$0.07 | +3.3% | +15.3% | +30.0% |
Premier Investments (PMV) | $33.14 | +$1.05 | +3.3% | +10.6% | +49.4% |
Dicker Data (DDR) | $10.22 | +$0.32 | +3.2% | +7.6% | +29.5% |
Super Retail Group (SUL) | $15.97 | +$0.47 | +3.0% | +17.9% | +32.6% |
Flight Centre Travel Group (FLT) | $22.21 | +$0.65 | +3.0% | +11.1% | -4.3% |
Xero (XRO) | $138.18 | +$3.93 | +2.9% | +3.5% | +13.1% |
Light & Wonder (LNW) | $164.86 | +$4.5 | +2.8% | +7.3% | +58.0% |
Wesfarmers (WES) | $73.65 | +$2.01 | +2.8% | +14.3% | +48.5% |
Life360 (360) | $16.56 | +$0.41 | +2.5% | +5.6% | +110.7% |
Codan (CDA) | $13.12 | +$0.32 | +2.5% | +10.0% | +73.8% |
Dexus (DXS) | $7.02 | +$0.17 | +2.5% | +8.8% | -14.2% |
Webjet (WEB) | $8.91 | +$0.21 | +2.4% | -0.3% | +14.1% |
Car Group (CAR) | $34.85 | +$0.82 | +2.4% | +1.4% | +42.8% |
ASX Technology, Consumer Discretionary, Communication Services, and Real Estate Investment Trusts stocks today
The other two sectors that beat the XJO’s performance today are hardly what you’d call “interest rate sensitive” – or all that sensitive to anything the RBA does, to be fair. Energy (XEJ) (+2.5%) was the second best performing sector today, and Resources (XJR) (+2.3%) was the third best.
It should be noted that base metals, for the most part, got belted yesterday, and crude oil was also sharply lower. I can see iron ore futures, gold and silver futures, and crude oil futures bouncing back a little in Asian trade – but net-net – I put to you today’s move wasn’t about commodity prices.
I suspect, and this is just a guess, it was more about general risk-on versus risk-off. The local bourse swung a deviation or two towards risk-on today, and the shorts in these two beaten down sectors took this as a sign to get out of town. Even if commodity prices are a bit lousy, rising tide and all ships sort of stuff – being short or underweight resources and energy probably got turfed in the too hard basket today.
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
|---|---|---|---|---|---|
Black Cat Syndicate (BC8) | $0.365 | +$0.035 | +10.6% | +17.7% | -12.0% |
Bannerman Energy (BMN) | $3.04 | +$0.24 | +8.6% | -2.3% | +85.4% |
Chalice Mining (CHN) | $1.145 | +$0.09 | +8.5% | -24.4% | -80.7% |
Vulcan Energy Resources (VUL) | $4.57 | +$0.34 | +8.0% | +17.8% | +4.1% |
Latin Resources (LRS) | $0.150 | +$0.01 | +7.1% | -14.3% | -56.5% |
St Barbara (SBM) | $0.225 | +$0.015 | +7.1% | +12.5% | -8.2% |
Coronado Global Resources (CRN) | $1.440 | +$0.085 | +6.3% | +7.5% | -13.5% |
Nickel Industries (NIC) | $0.855 | +$0.05 | +6.2% | +6.9% | +5.6% |
Deep Yellow (DYL) | $1.290 | +$0.07 | +5.7% | -1.9% | +89.7% |
Pilbara Minerals (PLS) | $2.93 | +$0.14 | +5.0% | -1.3% | -40.8% |
Boss Energy (BOE) | $3.65 | +$0.16 | +4.6% | -8.8% | +25.4% |
Mineral Resources (MIN) | $54.28 | +$2.3 | +4.4% | +1.2% | -24.5% |
Champion Iron (CIA) | $6.28 | +$0.25 | +4.1% | -3.4% | +7.5% |
Sandfire Resources (SFR) | $8.70 | +$0.34 | +4.1% | +1.3% | +32.0% |
Capricorn Metals (CMM) | $5.38 | +$0.21 | +4.1% | +12.3% | +21.4% |
Ramelius Resources (RMS) | $1.940 | +$0.075 | +4.0% | +3.2% | +53.4% |
Resolute Mining (RSG) | $0.650 | +$0.025 | +4.0% | +18.2% | +71.1% |
Deterra Royalties (DRR) | $3.99 | +$0.15 | +3.9% | -0.7% | -14.9% |
Liontown Resources (LTR) | $0.950 | +$0.035 | +3.8% | -0.5% | -65.2% |
Yancoal Australia (YAL) | $7.09 | +$0.23 | +3.4% | +1.0% | +38.7% |
Karoon Energy (KAR) | $1.865 | +$0.06 | +3.3% | +3.0% | -16.3% |
Fortescue (FMG) | $18.87 | +$0.59 | +3.2% | -12.5% | -13.0% |
Lynas Rare Earths (LYC) | $6.28 | +$0.19 | +3.1% | +2.4% | -4.3% |
Paladin Energy (PDN) | $11.41 | +$0.34 | +3.1% | -7.9% | +51.1% |
IGO (IGO) | $5.55 | +$0.15 | +2.8% | -1.4% | -61.2% |
Beach Energy (BPT) | $1.490 | +$0.04 | +2.8% | 0% | -7.7% |
Woodside Energy Group (WDS) | $27.60 | +$0.73 | +2.7% | -5.3% | -27.4% |
Rio Tinto (RIO) | $117.48 | +$2.82 | +2.5% | -1.8% | +0.7% |
Iluka Resources (ILU) | $6.06 | +$0.14 | +2.4% | -8.2% | -41.3% |
Santos (STO) | $7.99 | +$0.16 | +2.0% | +3.9% | +0.6% |
South32 (S32) | $3.07 | +$0.06 | +2.0% | -17.7% | -20.3% |
Newmont Corporation (NEM) | $73.65 | +$1.41 | +2.0% | +18.2% | 0% |
BHP Group (BHP) | $42.30 | +$0.76 | +1.8% | -2.0% | -7.6% |
Evolution Mining (EVN) | $3.93 | +$0.06 | +1.6% | +14.2% | +4.5% |
Northern Star Resources (NST) | $14.08 | +$0.2 | +1.4% | +9.7% | +21.7% |
Whitehaven Coal (WHC) | $7.72 | +$0.09 | +1.2% | -10.1% | +9.8% |
ASX Resources and Energy stocks today
ChartWatch
Gold Futures (Front month, back-adjusted) COMEX
Gold appears stuck in a trading range
The last time we covered gold was in ChartWatch in the Evening Wrap on 24 July.
In that update it was trying to hang onto the dynamic demand of the short term uptrend ribbon. Since then, it kinda has, and kinda hasn’t. It slipped the ribbon with a nasty supply-side candle on 25 July, only to bounce back to close back above it yesterday.
Today’s candle, still live, sees gold probing back towards that high from 24 July. A whole lot of work (and volatility) for a bit less than nothing. And so goes the gold chart until it can close on either side of what is becoming a very well defined trading range between 2351 and 2536.
It may be a case of “move along, there’s nothing to see here” until we can decisively close above 2536 = bull case = new highs = next leg up versus close below 2351 = bear case = probe next points of demand = potentially ends current long term uptrend.
I hope for my gold bug friends it’s the former, not the latter. 2399 is a key part of the equation now, I suggest that as long as gold continues to close above it, the short term bull case remains intact.
Clearly, anything above 2480.7 is supply. If we can start printing some white candles above there, particularly those closing on the high of their respective sessions – it would be an emphatic showing by the demand-side that they have the oomph to push on through to the other side.
The opposite, that is, black candle bodies and particularly long upward pointing shadows into 2480-2536 would demonstrate the supply side remains resolute in their intent to attack higher prices.
Silver Futures (Front month, back-adjusted) COMEX
A fledgling rally in silver has developed
The last time we covered silver was in ChartWatch in the Evening Wrap on 11 July. –
In that last update, silver was trying to form a “higher trough” after its strong rebound from 28.90 (note a contract roll since our last update means the prices have changed due to the customary back-adjustment process – all points of demand/supply remain valid, even though their price may have changed).
It never did form that higher trough, unfortunately, with the $32 point of supply proving too difficult for the demand side to overcome. The large black candle on 17 July sealed the seal for the supply side. Since then, it has been a procession of cascading excess supply. Until…
The long term uptrend ribbon did its job, that is, it offered dynamic demand. The candles out of the long term trend ribbon are encouraging – they appear to be manifesting a modest degree of excess demand.
The old 28.35-29.05 demand zone is likely to offer supply – we must watch the candles very closely in here. As long as they remain demand-side in nature (i.e. white-bodied and or downward pointing shadows), there’s every change we could see 29.63 tested. That point coincides with the upper end of the dynamic supply that is likely to be encountered at the coincident short term downtrend ribbon.
This fledgling silver really needs to get itself above there, and preferably, also very soon having transitioned itself back to rising peaks and rising troughs (i.e. demand reinforcement and supply removal).
There’s plenty of supply all the way up from here – so the demand side has its work cut out.
Looking at the bearish scenario, if the silver price closes below 27.45 (and this will likely mean below the long term uptrend ribbon also), then the long term uptrend would have transitioned to down. Ergo, silver bull run over.
Economy
Today
AUS Consumer Price Index (CPI) June Quarter
Headline: +1.0% q/q and 3.8% p.a. = As forecast (+1.0% q/q and 4.0% p.a. March)
Trimmed Mean: +0.8% q/q and 3.8% p.a. vs +1.0% q/q and +4.0% p.a. forecast (+1.0% q/q and +3.9% p.a. March)
AUS Retail Sales June
+0.5% vs +0.3% forecast and +0.6% in May
CHN Manufacturing PMI July
49.4 vs 49.3 forecast and 49.5 in May
CHN Non-Manufacturing PMI
50.2 vs 50.3 forecast and 50.5 in May
Later this week
Wednesday
19:00 EUR Core CPI Flash Estimate July (+2.8% p.a. forecast vs +2.9% p.a. June)
Thursday
00:00 USA Pending Home Sales June (+1.6% forecast vs -2.1% May)
04:00 USA Federal Reserve interest rate decision (no change forecast)
04:30 USA Chairman Powell Press Conference
21:00 UK BOE interest rate decision (forecast -0.25% to 5.0%)
Friday
00:00 ISM Manufacturing PMI July (49.0 forecast vs 48.5 previous)
11:30 AUS Producer Price Index (PPI) June Quarter (forecast +1.0% q/q vs +0.9% q/q forecast)
22:30 USA Non-Farm Employment Change July (+177k forecast vs +206k June); Average Hourly Earnings July (+0.3% m/m forecast vs +0.3% June); Unemployment Rate (4.1% forecast vs 4.1% June)
Latest News
Interesting Movers
Trading higher
+11.9% Appen (APX) - Continued positive response to yesterday's Q2 FY24 Quarterly Activity Report and Appendix 4C, upgraded to buy from hold at Canaccord Genuity and price target increased to $0.80 from $0.60
+11.2% Magnetic Resources (MAU) - No news since 26 July LJN4 Averages 4700 Ounces Per Vertical Metre From 100m, rise is consistent with prevailing short and long term uptrends 🔎📈
+8.6% Bannerman Energy (BMN) - No news since 26 July Quarterly Activities Report, possibly short covering contagion rally in beaten down resources and energy stocks
+8.5% Chalice Mining (CHN) - Presentation - Gonneville Project Site Tour
+8.0% Vulcan Energy Resources (VUL) - No news since yesterday's Corporate Presentation Q3 2024, rise is consistent with prevailing short and long term uptrends 🔎📈
+7.1% Latin Resources (LRS) - Latin Resources - Quarterly Presentation and Quarterly Activities/Appendix 5B Cash Flow Report, small bounce in lithium futures in China
+6.9% Charter Hall Group (CHC) - No news, strong rally in ASX real estate stocks today due to positive CPI developments
+6.7% Aura Energy (AEE) - Quarterly Activities/Appendix 5B Cash Flow Report
+6.6% Kogan.Com (KGN) - No news since 29 July Kogan.com - July 2024 Business Update
+6.3% Coronado Global Resources (CRN) - No news since 25 July Q2 FY2024 Quarterly Activities Report, rise is consistent with prevailing short term uptrend, long term trend is transitioning from down to up 🔎📈
+6.2% Nickel Industries (NIC) - Quarterly Activities Presentation and Quarterly Activities Report, closed back above both short and long term downtrends ribbons
+5.7% Deep Yellow (DYL) - No news since 29 July June 2024 Quarterly Activities Report, probably ditto with BMN
+5.3% Strike Energy (STX) - Spud of Booth-1
+5.2% Technology One (TNE) - Continued positive response to yesterday's Investor Day announces TAM of $13.5B and $1B ARR by FY30, upgraded to outperform from sector perform at RBC Capital Markets and price target increased to $24.00 from $20.00
Trading lower
-7.5% Jupiter Mines (JMS) - June 2024 Quarterly Activities Report, fall is consistent with prevailing short term downtrend, falling peaks and falling troughs, threatening to close below long term downtrend 🔎📈
-4.8% Meteoric Resources (MEI) - No news since 26 July Institutional Placement of $27.5 Million and Launch of SPP, fall is consistent with prevailing short and long term downtrends 🔎📈
-2.6% Brainchip (BRN) - No news, fall is consistent with prevailing short and long term downtrends 🔎📈
-2.2% Baby Bunting Group (BBN) - No news, fall is consistent with prevailing short and long term downtrends 🔎📈
-1.2% Telix Pharmaceuticals (TLX) - Investor Conference Call - TLX250-CDx BLA Filing Update and BLA Filing Update for Renal Cancer Imaging Agent TLX250-CDx
Broker Notes
Aeris Resources (AIS)
Upgraded to outperform from neutral at Macquarie; Price Target: $0.26
AMP (AMP)
Retained at buy at Ord Minnett; Price Target: $1.25
Appen (APX)
Upgraded to buy from hold at Canaccord Genuity; Price Target: $0.80 from $0.60
ASX (ASX)
Retained at lighten at Ord Minnett; Price Target: $59.50
Australian Vanadium (AVL)
Retained at buy at Shaw and Partners; Price Target: $0.08
BHP Group (BHP)
Retained at buy at Citi; Price Target: $47.50
Retained at accumulate at Ord Minnett; Price Target: $45.00
Retained at neutral at UBS; Price Target: $43.00
Credit Corp Group (CCP)
Downgraded to neutral from outperform at Macquarie; Price Target: $18.01 from $18.32
Retained at add at Morgan Stanley; Price Target: $20.50 from $20.60
Challenger (CGF)
Retained at buy at Ord Minnett; Price Target: $7.80
Champion Iron (CIA)
Retained at buy at Jarden; Price Target: $7.58
Centuria Industrial Reit (CIP)
Retained at overweight at Jarden; Price Target: $3.65
Frontier Digital Ventures (FDV)
Retained at add at Morgans; Price Target: $0.66 from $0.71
Fortescue (FMG)
Upgraded to overweight from neutral at JP Morgan; Price Target: $23.00
Upgraded to add from hold at Morgans; Price Target: $23.00
Insurance Australia Group (IAG)
Retained at buy at Ord Minnett; Price Target: $8.10
IGO (IGO)
Retained at sell at Canaccord Genuity; Price Target: $4.80 from $5.00
Retained at neutral at Citi; Price Target: $6.00 from $6.80
Retained at buy at Jarden; Price Target: $8.30 from $8.53
Retained at neutral at JP Morgan; Price Target: $5.90 from $6.40
Retained at neutral at Macquarie; Price Target: $5.60 from $6.00
Retained at underweight at Morgan Stanley; Price Target: $5.05
Jumbo Interactive (JIN)
Retained at underweight at Jarden; Price Target: $15.20 from $15.40
Origin Energy (ORG)
Retained at buy at Citi; Price Target: $12.00
Retained at overweight at Jarden; Price Target: $11.00
Pointsbet (PBH)
Retained at overweight at Jarden; Price Target: $0.85
Perpetual (PPT)
Downgraded to neutral from outperform at Macquarie; Price Target: $22.80 from $27.50
Perseus Mining (PRU)
Retained at neutral at Citi; Price Target: $2.75 from $2.80
Retained at outperform at Macquarie; Price Target: $3.00
QBE Insurance Group (QBE)
Retained at hold at Ord Minnett; Price Target: $19.00
Ramsay Health Care (RHC)
Retained at neutral at Macquarie; Price Target: $50.10 from $53.35
Rio Tinto (RIO)
Retained at neutral at Citi; Price Target: $137.00
Retained at neutral at UBS; Price Target: $125.00
Ramelius Resources (RMS)
Retained at hold at Argonaut Securities; Price Target: $2.20
Retained at buy at Canaccord Genuity; Price Target: $2.80 from $2.70
Retained at buy at Ord Minnett; Price Target: $2.25 from $2.30
Retained at sector perform at RBC Capital Markets; Price Target: $2.50 from $2.40
Retained at buy at Shaw and Partners; Price Target: $2.73
RMA Global (RMY)
Retained at buy at Bell Potter; Price Target: $0.10 from $0.12
St Barbara (SBM)
Retained at outperform at Macquarie; Price Target: $0.28
Steadfast Group (SDF)
Retained at accumulate at Ord Minnett; Price Target: $6.85
Siteminder (SDR)
Retained at buy at Citi; Price Target: $6.15
Suncorp Group (SUN)
Retained at accumulate at Ord Minnett; Price Target: $18.20
Telix Pharmaceuticals (TLX)
Retained at buy at Jarden; Price Target: $22.55
Technology One (TNE)
Retained at add at Morgans; Price Target: $20.50
Upgraded to outperform from sector perform at RBC Capital Markets; Price Target: $24.00 from $20.00
Retained at buy at UBS; Price Target: $21.90
Treasury Wine Estates (TWE)
Retained at buy at UBS; Price Target: $14.50
Woodside Energy Group (WDS)
Retained at neutral at Citi; Price Target: $28.00
Computershare (CPU)
Retained at accumulate at Ord Minnett; Price Target: $29.15
Scans
Carl has over 30-years investing experience, helping investors navigate several bull and bear markets over this time. He is a well respected markets commentator who specialises in how the global macro impacts Australian and US equities. Carl has a passion for technical analysis and has taught his unique brand of price-action trend following to thousands of Aussie investors.
Get the latest news and insights direct to your inbox
Latest Articles
It’s time to sell ASX bank shares and buy resources says this major broker
Carl Capolingua · Fri 04 Oct 24, 1:22pm (AEDT)
Morgan Stanley: ASX 200 REITs to trend higher over the next 12 months
Kerry Sun · Fri 04 Oct 24, 12:28pm (AEDT)
Get free post-market insights with our Evening Wrap
Create an account to receive our concise, data-driven post-market recap, sent directly to your inbox, every day.
Along with the Evening Wrap, you'll join 100k+ investors who receive our Morning Wrap and Weekend Newsletter.
Subscribe Now Sign Up FreeAlready have an account? Log in
