Earnings results flow in apace

After a two-day drop caused by interest rate jitters in global markets before the Jackson Hole Economic Policy Symposium this weekend, the S&P/ASX 200 index ended Wednesday 36.3 points, or 0.5 per cent, higher at 6,998.1 points, while the broader S&P/ASX All Ordinaries Index gained 43.1 points, or 0.6 per cent, to 7,242.3.
 
Earnings results pouring in continue to be eagerly seized upon by investors, if good, while disappointments are being punished heavily.
 
Global logistics software leader WiseTech Global jumped $6.77, or 12.8 per cent higher, after reporting a 25 per cent rise in revenue, to $632.2 million, and a 72 per cent surge in underlying net profit, to $181.8 million.

WiseTech shares are now back to their highest level since the first week of January, before the worldwide tech sell-off hit the markets.
 
Mineral sands and rare earths miner Iluka Resources brought out a half-year result that the market liked, with net profit almost tripling, to $368.5 million, and the interim fully franked dividend more than doubling, from 12 cents a share to 25 cents.

In response Iluka shares leapt 93 cents, or 9.8 per cent higher, to close at $10.38.
 
Shares in Sonic Healthcare rose $2.05, up 6.2 per cent, to $35.24 after the global pathology group boosted its dividend by almost 10 per cent on stronger-than-expected cash generation from COVID-19 testing.

Revenue from Covid-19 testing increased 3 per cent, to $2.4 billion, in the year to June 30, representing more than a quarter of the group’s total revenue, which rose 7 per cent to a record $9.3 billion.

Net profit increased by 11 per cent to $1.5 billion, enabling Sonic to pay a fully franked dividend of 60 cents a share, up 9 per cent.
 
Supermarket giant Coles dropped 86 cents, or 4.6 per cent, to $17.84 after beating earnings expectations with a 4.3 per cent rise in net profit to $1.05 billion, on revenue that was up 2 per cent to $39.4 billion, but the market was disappointed with Coles saying it expects volumes to fall as inflation and rising interest rates bite into household budgets.
 
Payments company EML Payments plunged 11 cents, or 10.6 per cent, to 89 cents, after one of its businesses uncovered fraudulent activity, potentially costing the company up to $7.9 million.

At one point EML Payments was down by more than 15 per cent, at 85 cents, which was the stock’s lowest point since November 2015.
 
The energy sector was the biggest gainer on Wednesday, rising 2.8 per cent as natural gas prices surged and as Brent crude moved above $US100 a barrel for the first time in two weeks, on expectations of production cuts from OPEC+.
 
Woodside Energy gained 3.4 per cent, to $34.82, as it began construction on its Pluto Train 2 LNG project in Western Australia, while Santos added 2.1 per cent to $7.72 and Beach Energy lifted 1.2 per cent to $1.70.
 
White-hot Whitehaven, lithium stars lead miners higher
 
Of the heavyweight miners, BHP gained 1.1 per cent to $41.91, Rio Tinto eased 0.6 per cent to $97.10, and Fortescue Metals was up 0.4 per cent, at $19.12.

Lithium miners continued their strong run, with Pilbara Minerals gaining 20 cents, or 6.1 per cent, to $3.47 and Allkem adding 5.5 per cent to $13.88.

On the coal front, Whitehaven Coal added a further 1.9 per cent, to $7.90, ahead of its full-year earnings report on Thursday.

Whitehaven’s shares have tripled so far this year, to be the best performer of the S&P/ASX200 cohort.
 
Among the big banks, ANZ rose 1.6 per cent to $22.81, outpacing its big three peers, with Westpac up 0.1 per cent at $21.38 and CBA and NAB both up by 0.2 per cent, to $97.20 and $30.01 respectively.
 
US markets waiting on Jackson Hole
 
In the US, the broad S&P 500 index rose 12 points, or 0.3 per cent, to 4,140.8, with the 30-stock Dow Jones Industrial Average up 59.6 points, or 0.2 per cent, to 32,969.2, and the tech-heavy Nasdaq Composite up 50.2 points, or 0.4 per cent, to 12,431.5.

The rises broke a three-day decline in the Dow and the S&P 500, as investors await more clarity on the Federal Reserve’s fight against inflation, which should emerge from the central bank’s 46^th annual Jackson Hole symposium later in the week.

Brent crude gained US$1 to US$101.20 a barrel, gold is up 8 cents at US$1,752.11 an ounce and the Australian dollar is buying 69.07 US cents this morning.

Drew Meredith

Drew is publisher of the Inside Network's mastheads and a principal adviser at Wattle Partners.