Morning Bell 6 August

Paulina Peters
August 6, 2020

Aussie equities are eyeing a 0.5% lift at the open, following a positive session overnight. We saw U.S. stocks rise on the back of Disney revealing it has 100 million streaming subscribers and COVID-19 vaccine hopes.

Medical device company, Johnson & Johnson have struck up a $1 billion deal with the U.S. government to manufacture 100 million doses of its COVID-19 vaccine candidate, if it proves successful. Following this news, its share price rose 0.8%.

What to watch today:

  • ResMed (ASX:RMD), they announced their fourth quarter fiscal 2020 earnings today. The highlights included a revenue increase of 9% to $770.3m and a net operating profit increase of 84% compared to the prior year period. The strong result is largely due to strong ventilator demand during the period.
  • Energy producers, like Beach Energy (ASX:BPT) and Woodside Petroleum (ASX:WPL) could push higher today following the lift in the oil price. Both stocks closed 0.7% lower yesterday.
  • And with the gold price once again hitting a new record overnight, up 1.5% to US$2,053 an ounce, keep an eye on gold miners like Northern Star Resources (ASX:NST) and Saracen Mineral Holdings (ASX:SAR).

Local trading ideas:

  • Centuria Capital Group (ASX:CNI) is showing a bullish signal according to Trading Central’s charting. Yesterday, Centuria closed 5.5% up at $1.83 and Trading Central believes the stock’s share price may rise to between $1.89 – $1.93 in 24 days according to standard principles of technical analysis.
  • Fortescue Metals Group (ASX:FMG), Bell Potter has lifted FMG’s price target by 17% to $12.50, but have lowered their recommendation of the stock from a Hold to a Sell following strong share price appreciation. A near term catalyst for FMG includes the release of its FY20 financial results and declaration of its final FY20 dividend on the 24th of August. The stock goes ex-dividend likely in early September.
Read Transcript

Good morning this Wednesday the 6th of August.

I’m Paulina Peters a market analyst with Bell Direct, covering for Jess today.

Aussie equities are eyeing a 0.5% lift at the open if you go by the futures.

This follows a positive session overnight. We saw U.S. stocks rise on the back of mixed Disney earnings and COVID-19 vaccine hopes.

Despite reporting mixed results, Disney’s shares rose 8.8% with the company confirming that they now have 100 million paid subscribers across its streaming services, which include Disney+, Hulu and ESPN+.

Medical device company, Johnson & Johnson have struck up a $1 billion deal with the U.S. government to manufacture 100 million doses of its COVID-19 vaccine candidate, if it proves successful.

Following this news, its share price rose 0.8%.

The U.S. market ended with the Dow up 373 points, the S&P 500 closing higher for its fourth straight day, now just 2% from its February record, and the tech-heavy Nasdaq closing 0.5% higher.

Looking at commodities, the Oil price lifted more than 1% to a new five-month high following a larger than expected inventory drop.

The Brent crude was up 70 cents, or 1.6% to US$45.13 a barrel. And, the iron ore price is trading higher, up 1.3% to US$115.

What to watch today, well ResMed (ASX:RMD), they announced their fourth quarter fiscal 2020 earnings yesterday.

The highlights included a revenue increase of 9% to $770.3m and a net operating profit increase of 84% compared to the prior year period.

The strong result is largely due to strong ventilator demand during the period.

Energy producers, like Beach Energy (ASX:BPT) and Woodside Petroleum (ASX:WPL) could push higher today following the lift in the oil price.

Both stocks closed 0.7% lower yesterday.

And with the gold price once again hitting a new record overnight, up 1.5% to US$2,053 an ounce, keep an eye on gold miners like Northern Star Resources (ASX:NST) and Saracen Mineral Holdings (ASX:SAR).

Now to finish on two trading ideas, Centuria Capital Group (ASX:CNI) is showing a bullish signal according to Trading Central’s charting.

Yesterday, Centuria closed 5.5% up at $1.83 and Trading Central believes the stock’s share price may rise to between $1.89 – $1.93 in 24 days according to standard principles of technical analysis.

And finally, Fortescue Metals Group (ASX:FMG), Bell Potter has lifted FMG’s price target by 17% to $12.50, but have lowered their recommendation of the stock from a Hold to a Sell following strong share price appreciation.

A near term catalyst for FMG includes the release of its FY20 financial results and declaration of its final FY20 dividend on the 24th of August.

The stock goes ex-dividend likely in early September.

I’m Paulina Peters, with Bell Direct, Happy Trading.

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