ASX surrenders early lead to fall flat

ASX weakens, industrials gain as corporate activity booms, Chinese exports jump

The ASX 200 (ASX: XJO) weakened throughout the day to finish slightly lower than it started on Tuesday.

The majority of the weakness came from the energy, down 0.6%, and real estate sectors, down 0.9%. Woodside Petroleum Limited (ASX: WPL) and GPT Group (ASX: GPT) were among the hardest hit, falling over 1% each.

The ASX mining sector, including BHP Group Ltd (ASX: BHP), gained after Chinese exports jumped significantly more than expected, up 32% in June, quickening from a 28% annual growth rate in May.

Shares in Nearmap Ltd (ASX: NEA) continued to fight back against an earlier shorting attack with the company upgrading its profit result for the financial year.

Nearmap confirmed its annual contract value would be $133.8 million, ahead of the $132 million estimated just a few weeks ago. The Nearmap share price jumped 14.4% in response.

Shares in small-cap prepared meals group Youfoodz Holdings Ltd (ASX: YFZ) surged 77.5% to 90 cents per share after global competitor HelloFresh (ETR: EFG) lobbed a $125.3 million takeover bid. 

Youfoodz shares remain well below its $1.50 IPO price, likely leaving many shareholders underwhelmed.

Platinum tanks, iCar Asia under offer, almonds going nuts

Platinum Asset Management Ltd (ASX: PTM) was the worst among the large caps, dropping 8.3% after reporting assets under management had dropped by just $167 million to $23.5 billion.

Meanwhile, shares in competitor Magellan Financial Group Ltd (ASX: MFG) gained 2.5%.

Online car trading business iCar Asia Ltd (ASX: ICQ), which operates in South East Asia, jumped 60% after receiving a 55 cent per share takeover offer from Carsome Group. This is 10% ahead of the offer received in October last year.

Almond producer Select Harvests Limited (ASX: SHV) is benefitting from the growing drought across California.

Select Harvest, the world’s largest producer of almonds, delivered a market update announcing almond shipments to date are up 21.7% with forward commitments 34% ahead.

Management noted this was an ‘unprecedented pace’ with shipment records being set in 10 of the 11 months to date. Adding to this has been a price spike of 5-10%. SHV shares finished 16% higher on the news.

Personal lender Plenti Group Ltd (ASX: PLT), an investment in the Federation strategy, jumped 11.9% after reporting $83 million loan originations in June, a $1 billion annual run rate by comparison.

The loan book has increased to $757 million, 96% above 2020 and 23% above the March quarter. 

Inflation accelerates, US markets fall, bank profits double

All three US stock market benchmarks closed around 0.3% lower overnight, the Nasdaq down 0.4% after inflation continued to accelerate.

According to the initial release, inflation moved 0.9% higher in June, taking the annual pace to 5.4% from 5% in May, the fastest since 2008.

Once again, the cost of used cars contributed over one-third of the increase, but food, energy, and housing prices also contributed. The core, less volatile measure also increased 4.5% from 3.8%.

Goldman Sachs (NYSE: GS) profit doubled to US$5.5 billion for the quarter on revenue of US$15.4 billion as a boom in corporate activity and takeovers benefitted the group’s dealmakers.

The funds management division saw revenue double to over US$5 billion, overcoming a 32% fall in the group’s trading operations as lower volatility reduced the demand for hedging; shares fell 1.1% on the news.

J.P. Morgan (NYSE: JPM) delivered a similarly strong result, nearly tripling quarterly profit to US$11.9 billion despite an 8% fall in revenue, the bank benefitting from a reversal of pandemic-era loan writedown reversals.

J.P. Morgan’s investment banking fees rose 25% on the back of a series of major IPOs, trading revenue fell 30%, whilst the traditional bank saw a further 8% fall in interest income as low interest rates continue to bite; shares were 1.7% lower.