FIVE at FIVE AU: ASX lifts today, but spends most of the week with its ‘head in the sand’
Published: 23:39 25 Jul 2024 EDT
The ASX is higher at around 1.30 AEST today.
The S&P/ASX200 had gained 68.40 points or 0.87% to 7,929.60, despite crossing below its 20-day moving average at time of writing. The index has lost 0.53% for the last five days, but sits 1.91% below its 52-week high.
The top-performing stocks in this index are Karoon Energy Ltd and Deep Yello Ltd, up 5.32% and 5.19% respectively.
Looking at the sectors, Utilities is the worst performed losing 0.59%. Consumer Staples was the only sector to dip, down just 0.16%. Most sectors were in the green with Materials (+1.58%), Real Estate (+1.40%), Healthcare (+1.32%) and Energy (+1.27%) the best performed.
Today’s gain bucks the pattern for most of the week.
The ASX200 finished 102 points (-1.29%) lower yesterday at 7,861 as all eleven sectors closed lower.
IG Markets analyst Tony Sycamore wrote: “While the free-falling AUD/USD has been the canary in the coal mine this week in terms of recognising the threats posed by the slowdown in China and risk sentiment more broadly, the ASX200 spent the first three days of this week with its head in the sand until yesterday's sell-off saw it close at a two-week low.”
As for small caps, the S&P/ASX Small Ordinaries (XSO) is 0.46% higher today to 3,006.70. Over the past five days, the index has lost 0.86%.
Alphabet earnings
This week Alphabet released another set of positive earnings.
"In Q2 2024, Alphabet delivered another earnings report with multiple beats, showcasing continued strength across its core business segments. Notably, Google Cloud achieved a significant milestone, surpassing $10 billion in quarterly revenues for the first time and generating $1 billion in operating profit, reflecting a remarkable 28.83% year-over-year growth,” wrote eToro market analyst Farhan Badami.
“Sundar Pichai, CEO of Alphabet, attributed the impressive results to the company's continued innovation and leadership in AI and cloud infrastructure. Pichai highlighted the strong performance of Google Search and the momentum in Google Cloud as key drivers of growth.
“Despite these strong financial results, Alphabet faced a setback in its strategic expansion plans. The company's bid to acquire the cybersecurity firm Wiz for $23 billion was declined, as Wiz opted to pursue an independent path towards an IPO.
The failed acquisition attempt also reflects broader challenges in the regulatory environment for big tech companies. With increasing scrutiny from regulators, large-scale mergers and acquisitions face significant hurdles.
“Alphabet's strong earnings report and continued innovation in cloud and AI position the company well for future growth. They have over $100 billion in cash, helping the company earn over a billion dollars in interest income for the quarter, proving that having substantial cash reserves and low debt in a high interest rate environment can be advantageous.
"For investors, Alphabet's solid financial health and robust revenue growth offer a positive outlook for the stock. Their continued growth in high-margin areas like cloud computing, coupled with effective cash management, positions it well for sustained long-term performance."
Five at five
Buru Energy validates Phase 1 development plan at Rafael with analysis of 3D seismic survey
Buru Energy Ltd (ASX:BRU, OTC:BRNGF) has gained increased confidence in its Phase 1 development plan for the Rafael discovery on the EP428 and EP457 licences in the Canning Basin of Western Australia after an analysis of 3D seismic survey data.
Empire Energy secures 10-year gas sales agreement with NT government to supply 25 TJ per day
Empire Energy Group Ltd (ASX:EEG, OTC:EEGUF) has locked in a binding, 10-year gas sales agreement with the Northern Territory Government to supply 25 terajoules (TJ) of gas per day from the Carpentaria Pilot Project in the Beetaloo Basin.
Cyprium Metals and Glencore join forces to accelerate Nifty copper production
Cyprium Metals Ltd (ASX:CYM, OTC:CYPMF) and mining giant Glencore International AG have collaborated to expedite the resumption of copper production from the Nifty copper complex in Western Australia 400km southeast of Port Hedland.
Piedmont Lithium (ASX:PLL, OTC:PLLTL) increases spodumene concentrate production by 23% in second quarter
Piedmont Lithium (ASX:PLL, OTC:PLLTL) Inc is nearing steady-state production at the jointly owned North American Lithium (NAL) spodumene concentrate processing plant, having shipped about 14,000 dry metric tonnes (dmt) of concentrate in the second quarter.
Horizon Minerals on track to develop Boorara project following positive ore reserve study
Horizon Minerals Ltd (ASX:HRZ) has just wrapped up its independent ore reserve study for the Boorara Gold Project, conducted by AMC Consultants. The study confirms a financially viable project, with a projected open pit mine design producing 1.24 million tonnes at a fully diluted grade of 1.24 g/t gold for a total of 49,500 ounces over an estimated 14-month mine life.
On your six
Investors are seeking the right answers to the wrong questions
Boston-based MFS investment management portfolio manager and global investment strategist Robert Almeida says: “We’re careening toward the point where fundamentals drive valuations rather than discount rates or maneuvers by policymakers. Central banks cannot fix businesses that are broken.” To combat this, investors need to ask the right questions around the terminal value of companies.
The one to watch
Tryptamine Therapeutics Begins Phase 2a Trial for IBS Treatment at MGH
Tryptamine Therapeutics Ltd (ASX:TYP) president and chief scientific officer Jim Gilligan joins Jonathan Jackson in the Proactive studio to discuss the company’s Phase 2a clinical trial at Massachusetts General Hospital (MGH) in the US, targeting the treatment of Irritable Bowel Syndrome (IBS).
