by Lauren Hayes
US equities held on to a two-day winning streak ahead of tomorrow’s midterm elections and the government’s latest report on consumer inflation, due Thursday. In local markets, there is no real leadership this morning, with the sectors mixed across the board. At noon, the S&P/ASX 200 is 0.44 per cent or 30.70 points higher at 6,964.40.
In economic news, NAB’s October monthly business survey shows conditions remained strong, albeit business confidence weakened. Business confidence fell 4 points to 0 index points, below the long-run average. NAB outlined confidence fell sharply in transport and utilities, along with mining, manufacturing, finance, business and property, recreation and personal services, and wholesale.
The SPI futures are pointing to a rise of 28 points.
Best and worst performers
The best-performing sector is Financials, up 1.11 per cent. The worst-performing sector is Industrials, down 0.17 per cent.
The best-performing stock in the S&P/ASX 200 is The Lottery Corporation (ASX:TLC), trading 4.77 per cent higher at $4.50. It is followed by shares in Pilbara Minerals (ASX:PLS) and The A2 Milk Company (ASX:A2M).
The worst-performing stock in the S&P/ASX 200 is James Hardie Industries (ASX:JHX), trading 13.09 per cent lower at $29.02. It is followed by shares in Sims (ASX:SGM) and Medibank Private (ASX:MPL).
Asian news
Stocks in the Asia-Pacific are so far trading higher this morning.
The Nikkei 225 in Japan has risen 1.25 per cent and the Topix is 1.1 per cent higher as investors digest the Bank of Japan’s summary of opinions of board members from its monetary policy meeting in October, when it left interest rates unchanged. This is in stark contrast to hawkish global peers that have taken on jumbo rate hikes.
In South Korea, the Kospi has gained 0.38 per cent.
Narrative spin and market direction
Narrative selection has been becoming an increasingly bigger issue for the market. When it comes to monetary policy, the dovish spin revolves around two things – the movement of the past peak rate hikes and more of an acknowledgement of the two-sided risks. However, the Fed is also signalling an upside risk to the terminal rate, which could further tighten financial conditions and make equity valuation mathematics more difficult. On the earnings front, strategists are highlighting outsized 2023 estimate cuts, playing into the broader earnings risk theme. However, there are thoughts that this is the kind of capitulation needed for more credible bounce attempts. In terms of inflation, hard data continues to highlight stickier services of price pressures, particularly around the shelter components. However, core goods are starting to soften, the housing slowdown is dominating the headlines and higher-frequency data is showing some reprieve for rental payments. When it comes to China zero Covid, officials say they are sticking with this policy, although there is some loosening at the margin and expectations for more reopening of the cities.
Company news
Antilles Gold (ASX:AAU) announced that it has received preliminary assays for three cored holes from a six hole program at El Pilar in central Cuba that was recently completed in September. The holes were located along 300m of strike on the gold-copper oxide deposit that appears to overlay a large copper-gold porphyry deposit. Antilles Gold’s Exploration Director, Dr Christian Grainger commented that the assays from the oxide deposit were consistent with the historic drilling results that were the basis for the Exploration Target Range reported to the ASX in July this year. Shares are trading 2.4 per cent lower at 4 cents.
Skyfii (ASX:SKF) announced that it has signed an agreement for the deployment of Skyfii’s restaurant operations solution across an initial eight McDonald’s restaurants in the USA. The initial three-year contract has a Total Contract Value of AU $2 million. Wayne Arthur, CEO of Skyfii commented: “The opportunity to partner with both Halverson Group and McDonald’s to create an industry-first solution that solves some critical pain points for such a large and globally recognised QSR brand is a privilege. I am exceptionally proud that as consumer behaviour continues to evolve and the needs of our customers change, Skyfii can advance its solution offering to provide valuable operational data analytics to help solve these pain points for our clients.” Shares are trading 43 per cent higher at 5 cents.
Lode Resources (ASX:LDR) announced a drilling update from the 100 per cent owned Webbs Consol Silver Project located in the New England Fold Belt in north-eastern New South Wales. The ongoing Phase II drill program at the Webbs Consol Silver Project has resulted in another two significant drill intercepts. In response, Managing Director, Ted Leschke commented: “Discovering near-surface high-grade mineralisation in six lodes to date demonstrates both the rich endowment and potential scale of the Webbs Consol mineral system. This has heightened our confidence in on-going exploration efforts”. Shares are trading 8.7 per cent higher at 13 cents.
AD1 Holdings (ASX:AD1) a technology company with a growing portfolio of market-leading software businesses, announced that Art of Mentoring (AoM) has made a record breaking start to the year in North America with total revenue up 126 per cent year on year, driven by unprecedented new business sales. AD1 anticipates new contract wins achieved in year-to-date FY23 will deliver an LTV of approximately $1.43 million, based on historical customer retention rates. In response, AD1 Holdings Chief Executive Officer Brendan Kavenagh said: “AoM has delivered strong performance since the beginning of FY23 with important new customer wins and the renewal of key contracts with existing customers. This has created great momentum throughout AoM and the AD1 Group and we are thrilled to keep this momentum going as we move forward into FY23.” Shares are trading 13 per cent higher at 2 cents.
Green Technology Metals (ASX:GT1) announced today a new discovery at its flagship Seymour Lithium Project in Ontario, Canada. The new discovery, Blue Bear, is located approximately 500m south-east of the Aubry Complex, on the Pye West Limb, and sits within the same current mine permitting and baseline study boundary. GT1 Chief Executive Officer, Luke Cox commented: “This is the first discovery at Seymour in over 50 years. To find a spodumene-bearing pegmatite under cover utilising classic geological and modern geophysical and geochemical techniques is testament to the abilities of the GT1 technical team and our exploration modelling.” Shares are trading 5 per cent higher at $1.05.
Commodities and the dollar
Gold is trading at US$1675.78 an ounce.
Iron ore is 0.1 per cent lower at US$87.95 a tonne.
Iron ore futures are pointing to a rise of 0.52 per cent.
One Australian dollar is buying 64.89 US cents.
