Morning Bell 6 August

Paulina Peters
August 6, 2021

All three major US benchmarks pushed higher overnight. Energy and travel stocks bounced back ahead of Friday’s key jobs report, a key data point for the Federal Reserve as it considers when to tighten monetary policy.

Following the US, the Aussie share market is set to open ever so slightly higher, up 0.04% or 3 points to 7,423.

What to watch today:

  • Today, we have RBA Governor Phillip Lowe testifying at 9:30am AEST, followed two hours later by the RBA’s statement on monetary policy.
  • ResMed (ASX:RMD) announced its fourth quarter fiscal year 2021 results. RMD’s revenue increased by 6% to US$3.2 billion on a constant currency basis in comparison to the prior year period, and operating profit was up 12% on a non-GAAP basis. RMD closed yesterday at $37.18, trading at record high territory.
  • REA Group (ASX:REA) are set to report its financial year 2021 results. According to Goldman Sachs analysts, a 12% increase in REA’s revenue is expected as well as a 20% lift in EBITDA.
  • James Hardie (ASX:JHX) will be holding its AGM today.
  • The most traded stocks by Bell Direct clients yesterday: Fortescue Metals (ASX:FMG) after its share price came under pressure yesterday following the news that one of its contractors had returned a weak positive test result for COVID-19, which saw FMG’s share price fall 3.4%. However, it was later advised by the Department of Health, that the contactor had subsequently returned a negative test result. Also, Pinnacle (ASX:PNI, its share price lifted about 9% yesterday after reporting its financial year 2021 results, where the company’s net profit increased by more than 100% on the prior year.
  • The oil price lifted about 1.4%, the gold price dropped 0.4% overnight, and the iron ore continues to come under pressure, falling about 5.8% to US$171, now trading around 22% lower than its high last month.

Trading ideas:

  • Bell Potter has maintained its BUY recommendation on construction and engineering business, GenusPlus Group (ASX:GNP), with an increased price target to $1.30 (previously $1.25). Bell Potter believes its acquisition of selected Tandem Corp’s assets and contracts can drive several key strategic benefits including increased maintenance revenue, greater diversification of end markets and the ability to target work on Australia’s 5G rollout.
  • Bullish charting signals have been identified in Sezzle (ASX:SZL), HomeCo Daily Needs REIT (ASX:HDN) and Imdex (ASX:IMD) according to Trading Central.

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