US markets (S&P 500 Index +0.3%) ended the overnight session up after starting in the red, ending a 3-day losing streak. Stock traders remained hesitant to make any huge bets ahead of Jerome Powell’s speech on Friday, which may provide clues on how hawkish the Federal Reserve will be in the face of mounting economic challenges.
Most sectors were up slightly, with energy and real estate leading gains, while tech and healthcare remained mostly flat.
European markets (Stoxx 600 Index, +0.2%) were also up as European gas prices rose another 8%, taking the Dutch benchmark to a fresh record close. UK gas prices show similar moves. The dire European gas situation has been spilling over into other markets, with US gas prices continuing to trade near record highs.
Wisetech Global (WTC.ASX)
Wisetech Global shares surged +12.8% yesterday, reaching its highest level since January recovering its losses for the year (which is impressive for a tech stock).
WTC delivered a solid result which was flagged earlier about a month ago, helped by extra demand amid supply chain disruptions. Wisetech’s guidance for 2023 was the main driver of the share price gains, where they anticipated the strong growth momentum will continue, forecasting revenue growth in 2023 of 20-23%, and operating earnings (EBITDA) growth of +21% to +30%.
WiseTech have always been priced at a sharp premium, but we remain comfortable as the company consolidates integrated logistics platforms globally. Recent headlines highlight the importance of global logistics and we have an upbeat view on the sector. Our BUY rating does come with a high-risk caveat due to the volatile nature of the stock, and we would wait for some price consolidation after this recent surge given the stock trades near all-time highs and has just jumped +68% over the last 2-months.
Australia & New Zealand Market Movers
The Australian market (ASX 200 Index, +0.5%) was up yesterday on a busy earnings day mostly filled with strong profit result beats.
Energy and tech were the best performing sectors, while consumer staples lagged.
Coles shares fell -4.6% as the supermarket giant struggles with inflation eating into margins and earnings for 2023.
The New Zealand market (NZX 50 Index, +0.1%) edged higher as strong results offset losses across the broader market.
Spark shares rose +1.5% after delivering a sound result, while the TowerCo sale meant the proceeds would be used to fund share buybacks and an +8% increase in dividend for the 2023 financial year – which was well received.
Ebos shares were up +1.3% on their result delivering on strong growth both organically and via its numerous acquisitions its made recently.
Scales was also up on a mixed result, as strength from its food ingredients business offset softness in its horticulture business with the shares up +3.9% for the day.
Things Markets will be Watching this Week
Monday
Australia: Earnings from Ampol, Cooper Energy, OoH! Media, and Star Entertainment.
New Zealand: Earnings from Freightways, Steel & Tube, and Property for Industry.
Tuesday
Global: US new home sales
Australia: Earnings from Ansell, Boral, Endeavour Group, Kogan, Scentre Group
New Zealand: Earnings from Heartland group, and Summerset.
Wednesday
Global: US Pending homes sales data, and Eurozone consumer confidence.
Australia: Earnings from Coles, Domino’s Pizza, G8 Education, Qantas, Tabcorp, and WiseTech Global.
New Zealand: Annual shareholder meeting by Fisher and Paykel Healthcare and earnings from Meridian Energy, Ebos and Spark.
Thursday
Global: US second quarter GDP and initial jobs claim data.
Australia: Earnings from Appen, Ardent Leisure, Blackmores, Costa Group, Flight Centre, and Pilbara Minerals
New Zealand: Retail sales data, and earnings from Air NZ, Sky City, and Sky TV.
Friday
Global: Japan CPI (inflation) data.
Australia: Earnings from Next DC, Ramsay Healthcare, and Wesfarmers
New Zealand: ANZ consumer confidence report, Earnings from Port of Tauranga, Tourism Holdings, and Delegat Group.