Global markets continued to sell-off overnight after Trump hinted at the possibility of waiting another year before resolving the US-China trade rivalry. He signalled he has no deadline and that it would “probably be better to wait until the election for the China deal”.
The Reserve Bank of Australia kept the cash rate at 0.75% yesterday, with governor Philip Lowe saying the economy had passed a gentle turning point and that the board wanted more time to see how the current low rates played out.
Stock in Focus: Ooh! Media (OML:ASX)
OML upgraded its earnings yesterday, with the company now expecting full earnings of $138m-$143m (prev $125-$135m) – attributed to an improvement in advertising bookings for the fourth quarter which had helped offset a spending decline from earlier in the year.
oOh! reiterated the integration of its Commute business, previously known as Adshel, was on track, with $16m of cost synergies made in FY19 and more expected next financial year.
We currently have a BUY (High-Risk) rating on OML.
Members should look out for a full update on OML to be released in our weekly report.
Australia & New Zealand Market Movers
The Australian market sold off yesterday (ASX 200 index -2.19%) as a surprising expansion of the US's trade war wiped $45 billion from the local sharemarket on Tuesday, with the hawkish tone from the Reserve Bank of Australia following its decision to hold rates only adding to the market's pain.
The New Zealand market continued to retrace on Tuesday (NZX 50 index -0.65) as a revival in US trade protectionism added to pessimism among global investors. Local exporters were among the hardest hit as a stronger kiwi dollar combined with the souring sentiment. Meridian Energy rose as Meridian, Contact Energy and grid operator Transpower agreed to fast-track an upgrade to the lower grid to reduce any impact of a reduction in production if the Tiwai Point smelter were to close. Outside the benchmark index, Delegat Group told areholders at its annual meeting that it was on track to lift case sales and deliver an operating profit in line with expectations.
3 Things Markets Will be Watching this Week
- In NZ, the RBNZ is due to announce the new capital requirements for NZ banks and the ComCom due to release the final Fuel Study report.
- The Reserve Bank of Australia meets on Tuesday and markets expect the bank to keep interest rates on hold.
- Closely followed US payroll and manufacturing surveys are released this week.
Have a Great Day,