Market wraps 19th April 2022

Morning Bell - Paulina Peters

The local market advanced 0.6%, with nearly all sectors posting gains. The materials sector led the way, up an impressive 1.3%, while the financial sector was the only sector to post a loss.

Looking at the ASX200 leaderboard, travel stocks soared. Qantas (ASX:QAN) lifted 7%, its best performance since November 2020, as investors showed renewed confidence for this beaten down sector of the market. Meanwhile, the worst performer was Bank of Queensland (ASX:BOQ), down 6.3%, after the company reported results that disappointed the market and included cautions about a squeeze on margins.

The most traded stocks by Bell Direct clients last Thursday, they included Uniti Group (ASX:UWL), NAB (ASX:NAB) and Lake Resources (ASX:LKE).

Moving to the US, well it’s a big week of earnings for the market. Some big names reporting this week include Tesla, Netflix, United Airlines, Procter and Gamble, Johnson & Johnson, and American Express. On Monday however, all three benchmarks closed slightly lower with rising commodity prices heightening concerns about inflation. The 10-year Treasury yield also reached its highest level since late 2018, at one point trading at 2.8%.

What to watch today:

  • Despite the US market slightly falling, the futures are suggesting that the Aussie market is set to open 0.13% higher this morning. 
  • In commodities, the oil price rose off the back of outages in Libya deepening concerns over tight supplies. The gold price hit a one-month high on Monday, nearly reaching the $2,000 an ounce level, as concerns around the Russia-Ukraine conflict and rising inflationary pressure increased the appeal of the safe-haven asset. And the spot iron ore price is trading 2% higher at US$150 a tonne.
  • In economic news, the RBA will release its meeting minutes for April. The RBA noted that Australia's inflation has increased, and a further increase was expected, however, the board said it wanted to see actual evidence that the price level is sustainably within the 2 to 3% target range before it considers increasing interest rates.
  • Chartered accounting network company, Kelly Partners Group (ASX:KPG) is set to go ex-dividend today.

Trading Ideas:

  • Bell Potter have maintained its BUY rating on Allkem (ASX:AKE) with a trimmed price target, from $18.05 to $17.53. AKE’s current share price is $13.52 so this implies about 30% share price growth in a year.
  • Trading Central has a bullish signal on drilling services company, DDH1 (ASX:DDH), indicating that the stock price may rise from the close of $1.07 to the range of $1.13 - $1.15 in the next 40 days according to standard principals of technical analysis.