Morning Bell 11 November

Jessica Amir
November 11, 2020

The ASX200 is set to rise for the 5th day, eyeing a gain of 0.8% at the open.

With the announcement that Pfizer and BioNTech’s COVID-19 vaccine candidate is 90% effective, global markets have continued to push ahead, for the most part, on hopes of an economic recovery.

What to watch today:

– Keep airlines, travel stocks, engineering companies, property groups and banks on your radar. Companies to watch might include: Qantas (ASX:QAN), Corporate Travel Management (ASX:CTD), Flight Centre (ASX:FLT), Emeco (ASX:EHL), NRW Holdings (ASX:NWH), Suncorp (ASX:SUN), Auswide (ASX:ABA), Macquarie (ASX:MQG), Commonwealth Bank (ASX:CBA), ANZ (ASX:ANZ), Westpac (ASX:WBC), NAB (ASX:NAB), Ardent Leisure (ASX:ALG), Woodside (ASX:WPL) and Santos (ASX:STO).
– Coca-Cola (ASX:CCL) may be worth a look as the New York listed company rallied overnight.
– Company results out today: CBA (ASX:CBA), Eclipx Group (ASX:ECX), Ausnet Services (ASX:AST) and Recce Pharmaceuticals (ASX:RCE).
– AGMs today: Fortescue Metals (ASX:FMG), Bingo Industries (ASX:BIN) and Computershare (ASX:CPU).
– Consumer confidence data is out today. It is expected to show an improvement given rates were cut and the economy seems to be growing stronger than expected.

Local trading ideas:

– Bell Potter increased Flight Centre’s (ASX:FLT) Buy rating and target to $19.00, implying 21% upside as the travel industry looks brighter with a more effective vaccine potentially around the corner.
– Bell Potter reiterated Suncorp Group (ASX:SUN) as a Buy with a $10.20 price target, implying 12% upside.
– IDP Education (ASX:IEL), Dexus (ASX:DXS) and Spirit Technology (ASX:ST1) are all showing bullish charting signals according to Trading Central.

 

Read Transcript

A very good morning to you this Wednesday the 11th of November I’m Jessica Amir, market analyst with Bell Direct.

Well with the announcement that Pfizer and BioNtech’s COVID-19 vaccine candidate is 90% effective, global markets have continued to push ahead for the most part on hopes of an economic recovery plus we also have the election uncertainty behind us and many are expecting what’s called a SANTA RALLY expecting markets to kick on for the rest of the year and into January so money is definitely flying back into equities.

But what’s really key is something that has been unfolding of late, now this rotation into cyclicals away from tech names what does that mean will investors have been again buying pandemic battered stocks like airlines, engineering companies or companies and banks while reducing their holdings in high flying somewhat expensive tech names and state home stocks as well.

For example video conferencing company listed in New York their shares Zoom shares fell sharply again for the second straight day down 8% overnight.

Microsoft and Amazon losing 3% each overnight. Well Apple announced a bit of company news some good news for them again they’ve launched their first new Macs with their first ever Apple chips that’s what’s key there their first Apple chips.

Now that’s all Intel shares loads a bit of momentum.

As for outperforming stocks while Boeing charged up 5%, Chevron up almost 5% as well and the manufacturing company 3M lifted 3.5%.

As for how the broad indices finished well given tech makes up a big part of the U.S. market the broad S&P500 lost 0.1%, the tech heavy Nasdaq itself down 1.4% while the Dow Jones lifted 0.9%, the small cap index Russell 2000 again a standout outperforming up almost 2% earlier. Elsewhere oil continues its rebound it’s up 2%, gold has lifted 0.9%.

As for local trade well looks like the ASX is on for its fifth straight day of gain so futures were earlier suggesting a lift of 0.8%.

What to watch today again I’d keep an eye on airlines, travel stocks, engineering companies, property groups and banks keep them on your radar some companies to watch might include Qantas (ASX:QAN), Corporate Travel Management (ASX:CTD) and Flight Centre (ASX:FLT) which saw very strong gains yesterday.

Mining contracting groups as well might be worth a look like Emeco (ASX:EHL)and NRW holdings (ASX:NWH) as well as banks like Suncorp (ASX:SUN), Auswide (ASX:ABA), Macquarie (ASX:MQG) and of course the big four CBA (ASX:CBA), ANZ(ASX:ANZ), Westpac (ASX:WBC) and NAB (ASX:NAB).

And also keep an eye on Australia’s amusement park company Ardent Leisure (ASX:ALG).

In the energy side you might like to look at Woodside (ASX:WPL) and Santos (ASX:STO) and also the drink company Coca-Cola (ASX:CCL) may be worth a look, the New York listed version saw a bit of a strong kick overnight so could the ASX listed company CCL follow company results.

To look out for today include CBA as well as fleet leasing company Eclipx Group (ASX:ECX) as well as AST and RCE. AGMs says plenty Fortescue metals (ASX:FMG) will be in focus as well as Bingo (ASX:BIN) and Computershare (ASX:CPU).

Economic news out today consumer confidence data out expected to show an improvement given rates are cut and the economy is growing stronger than expected.

Trading ideas that could be worth a look Bell Potter again increased Flight Center travels buy rating and target to $19 and that implies 21% upside given the travel industry is looking brighter as the COVID-19 vaccine is potentially around the corner and speaking about Flight Center travel if you looked at its chart you’d see the 50-day moving average price for Flight Center is approaching the 200-day average and if the cross if this crosses it’ll signify a strong bullish uptrend from a charting perspective so keep an eye on flights and to travel.

Elsewhere Bell Potter increased Suncorps buy rating and target or maintaining it as a buy rather with a $10.20 target that implies 12% upside and lastly keep an eye on three stocks from a technical charting perspective IDP Education (ASX:IEL), Discus Property group (ASX:DXS) and Spirit Technology (ASX:ST1) all showing bullish charting signals and that’s according to Trading Central.

I’m Jessica here with Bell Direct stay safe happy trading.

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