ASX 200 afternoon report: 14th of February 2023

The ASX 200 trades 16 points (+0.22%) higher at 7434 at 3.00 pm Sydney time.

After sprinting out of the starting gates, the ASX 200 erased over 40 points of early gains after the Westpac Consumer confidence fell by 6.9% in February in response to last week’s hawkish RBA meeting and cost of living pressures.

As noted by Westpac, “At 78.5, the latest Index read is a touch above the 78 read in November but below the low point of the GFC (79.0) and only slightly higher than when the COVID pandemic first hit in April 2020 (75.6). Prior to that, we need to go back to the deep recession in the early 1990s to find weaker Index readings.”

Highlighting an apparent disconnect between a pessimistic household sector and the optimistic business sector, the NAB business Confidence survey released an hour later rose 6 points to 6 in January, to be back around the long-run average.

IT sector

The IT Sector has gained, led by a rebound in Megaport.

• Megaport added 3.42% to $6.04
• Wisetech Global added 2.3% to $56.62
• Afterpay owner Block added 2.3% to $110.79
• Xero added 1.7% to $78.17
• Appen extended its decline following its earnings report yesterday, falling 6.76% to $2.62.

Healthcare sector

Healthcare heavyweight CSL gained 0.76% to $307.75 after its earnings report showed an 8% fall in net profit it $US1.62bn, offset by a 19% rise in revenues to $US7.19bn and a 36% increase in plasma collections.

Going the other way, Ansell fell 8.79% to $25.62 after it cut FY23 guidance as demand for its protective medical equipment continues to ease from pandemic highs.

Consumer Discretionary stocks

The share price of Star Entertainment which fell over 20% yesterday, fell another 12% today to $1.31 after reporting increased competition from Crown Sydney and compliance costs following the Bell and Gotterson Reviews.

Elsewhere there were gains for fellow consumer facing stocks including:

• JB Hi-Fi added +2.03%
• Nick Scali added +1.48%
• Harvey Norman added +1.48%
• Super Retail Group added +0.76%.

Financial sector

Reflecting on today's conflicting Consumer and Business confidence data, the big banks have had a mixed day.

• NAB added +0.64% to $31.58
• Westpac added 0.13% to $23.73
• ANZ traded flat at $25.70
• CBA fell 0.14% to $109.13.

Mining sector

The big mining stocks have traded sideways as iron ore prices continue to hold around $120 per tonne.

• Rio Tinto fell 0.46% to $121.74
• BHP fell 0.31% to $47.72
• Fortescue gained 0.14% to $22.17.

Technical analysis

For the past three weeks, we have suggested trimming longs in the ASX 200 ahead of a likely pullback. Last week’s retreat erased the prior two weeks’ gains and indicates that the pullback we had been calling for is underway (in the vicinity of 4-5%).

ASX 200 daily chart