US-Russia talks soothe market, Cannon-Brookes in AGL bid, Tyro tanks

The Australian sharemarket looked to be succumbing to overseas weakness on Monday, falling as far as 0.7 per cent before rebounding in the afternoon, to gain 0.2 per cent for the session.
 
On what was a massive day for reporting season all eyes were on Russia, with the US and Russia agreeing to talks in part due to the work of the French; markets rallied in response.
 
The utilities sector was the highlight gaining 3.8 per cent after it was announced that Brookfield and billionaire green investor Mike Cannon-Brookes were looking to buy the business for $7.50 per share and then shut down the coal-fired generators faster than expected; shares rallied more than 10 per cent on hope of a higher offer.
 
Telstra (ASX: TLS) was also in the headlines, gaining 1.5 per cent after announcing a partnership with TPG Telecom (ASX: TPG) that provides both groups with reciprocal access to each other’s networks.
 
It brings TPG into a clear second place and reduces capital investment pressure on Telstra.
 
Shares in Tyro tanked by more than 25 per cent after management confirmed that Omicron had significantly impacted transaction growth.
 
The company reported an increase in transactions of just 9.7 per cent and a doubling of their loss to $11.2 million.
 
Ampol petrol sales hit record, Sonic dividend up on COVID tests, Lend Lease struggles continue
 
Ampol (ASX: ALD) is benefitting from a bumper year of petrol sales, selling 22 billion litres, a new record in 2021.
 
The result was a profit of $560 million and a significant jump in the dividend to 41 cents per share.
 
The company is clearly seeing a tailwind of demand as public transport remains empty but only time will tell if this recent run can continue.
 
Lend Lease (ASX: LLC) were broadly flat after the companies again cut its dividend after revenue fell by more than 12 per cent to $4.6 billion.
 
The result was a $264 million loss, a $400 million turnaround from the previous year as profits become more difficult to extract in a supply-constrained and highly competitive construction sector.
 
Sonic (ASX: SHL) will return $500 million via an on-market buyback after reporting a 7 per cent increase in revenue to $4.8 billion, behind continued strength in COVID-19 testing in Australia. Profit jumped 22.1 per cent to $835 million.
 
OZ Minerals (ASX: OZL) remains on track for its net-zero plan after the company reported a 50 per cent increase in revenue to $2.1 billion on the back of a surging copper price.
 
Production volumes combined with solid cost control were the key drivers of the result in an environment where staffing is becoming increasingly difficult.
 
Presidents Day, US futures weaker, gold rally continues
 
US markets are closed for Presidents Day, which couldn’t come at a more opportune time given the impending meeting between Vladimir Putin and Joe Biden as the US seeks to resolve concerns around an invasion of Ukraine.
 
Futures markets are pointing towards a weaker day for global markets, with all three benchmarks down more than 1 per cent on concerns of what any threat of war would do to Russian oil supply.
 
Gold remains among the biggest beneficiaries of higher inflation and geopolitical risk, surging past USD$1,900 and nearing AUD$2,700 this week.
 
Alibaba (NYSE: BABA) fell again in Asian trading after the regulator flagged concerns about illegal and unscrupulous investments occurring in the metaverse in China.

Drew Meredith

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