Finance groups impress, miners outperform

Steven Deare | February 8, 2022

Financial services giants have pleased investors with their earnings and helped produce a buoyant share market before the Commonwealth Bank gives its figures on Wednesday.

Macquarie Group and Suncorp earned support for how they have fared through coronavirus-challenged times and helped financial shares rise one per cent.

Miners however played a bigger role in the ASX performance. Heavyweights BHP and Fortescue each gained three per cent and Rio Tinto two per cent after China’s state planner called for faster infrastructure construction.

The price of iron ore, the miners’ key export for making steel, was up at about $US150 per tonne.

Materials and financial shares helped the ASX defy the lead from the US, where investors were still sulking about Meta’s poor earnings last week.

The benchmark S&P/ASX200 index closed up 75.9 points, or 1.07 per cent, to 7186.7 points on Tuesday.

The All Ordinaries index closed higher by 74.8 points, or 1.01 per cent, to 7489 points.

The Commonwealth Bank first-half earnings should influence market direction on Wednesday.

Stockbroker Morgans has forecast the key figures to be greater than last year. These include cash earnings of $4.32 billion and an interim dividend of $1.74 per share.

Meanwhile optimism appeared to linger after news on Monday that vaccinated foreign visitors will be welcome in Australia from February 21.

Travel shares were markedly higher, with Webjet and Flight Centre higher by seven and six per cent respectively. Regional airline Rex, a much smaller stock, rose nine per cent to $1.52.

The only share categories lower were technology and consumer staples.

Technology was weighed down by the US lead. Artificial intelligence software vendor Appen shed seven per cent to $8.25.

The biggest tech stock on the ASX, Afterpay owner Block, lost six per cent to $142.00.

In earnings news, Macquarie claimed a record third quarter, helped by its markets-facing businesses.

Macquarie Capital earnings helped offset a decline in the annuities divisions such as banking and financial services.

The stock was higher by three per cent to $201.57.

Insurer and bank Suncorp posted a near 21 per cent fall in first-half net profit after more insurance claims from natural disasters.

But the Queensland-based entity says its underlying business is strong, putting it in a “good” position in the second half of 2021/22.

Investors believed Suncorp and raised shares five per cent to $12.03.

The major banks were higher, with ANZ and Westpac faring best and rising one per cent each.

Shopping centre owner SCA Property Group raised first-half profit by 320 per cent thanks to increased valuations of its properties.

Funds from operations were up 30 per cent, helped by purchases of east coast sites and reduced coronavirus impacts.

The interim payout of 7.2 cents per unit was more than the 5.7 cents per unit paid at the same time last year.

SCA was higher by three per cent to $2.89.

IG Markets analyst Kyle Rodda noted the Aussie dollar had moved higher since Monday’s border decision.

The Australian dollar was buying 71.13 US cents at 1725 AEDT, higher than 70.86 US cents at Monday’s close.

ON THE ASX

* The benchmark S&P/ASX200 index closed up 75.9 points, or 1.07 per cent, to 7186.7 points on Tuesday.

* The All Ordinaries index closed higher by 74.8 points, or 1.01 per cent, to 7489 points.

* At 1725 AEDT, the SPI200 futures index was down five points, or 0.07 per cent, at 7079 points.

CURRENCY SNAPSHOT

One Australian dollar buys:

* 71.13 US cents, from 70.86 cents on Monday

* 82.17 Japanese yen, from 81.69 yen

* 62.31 Euro cents, from 61.98 cents

* 52.61 British pence, from 52.40 pence

* 107.20 NZ cents, from 107.01 cents.