ASX 200 afternoon report: August 31, 2023
Your ASX 200 afternoon report.
The ASX 200 trades 7 points (0.10%) higher at 7305 at 3.10 pm AEST.
ASX 200's strong recovery
A fortnight ago, the ASX 200 was down ~4.3% in August. However, after its thumping 2.5% rally this week, it is now down just 1.50% for the month. This week's rally has come on the back of a favourable tailwind from US equities, lower US bond yields, and a softer-than-expected Australian inflation number, which likely keeps the RBA on hold for a third month at 4.10% when it meets next week.
While it is tempting to think a new month will bring better fortunes, September is historically the worst month of the year for the ASX 200, with an average negative return of -2.29% over the past decade.
The bumpy conditions could start as early as tonight, with a raft of important economic data set to drop over the next 48 hours, including inflation reports in Europe and the US and a critical labour market report in the US tomorrow evening. The seatbelt fasten light remains switched on.
The ASX 200 market movement
Returning to the local market, while it was quiet at an index level, some fireworks were still left over at a stock level to sign off on a busy reporting season.
Mayne Pharma dived 18.95% to $3.85 after reporting a $317.4 million loss. City Chic fell 11.11% to 44c, extending its decline after it reported a $24 million loss yesterday. The share price of Harvey Norman gained 4.04% to $4.00 after it posted a higher-than-expected FY23 profit of $539.52 million.
Elsewhere, the iron ore miners were solid, led by Rio Tinto, which added 0.7% to $113.00, Fortescue added 0.33% to $21.49, and BHP added 0.25% to $4.83. After trading ex-dividend, energy giant Woodside and coal miner Whitehaven fell 4% and 9.23%, respectively.
The big banks are trading higher after another second night of soft economic data in the US, which has weighed down global bond yields. Westpac gained 0.94% to $21.93, ANZ added 0.90% to $25.27, Macquarie gained 0.64% to $178.24, and NAB gained 0.57% to $29.01.
It was a mixed day for lithium miners, with IGO gaining 5.68% to $13.98 after it reported a 13% increase in revenues to $1.02 billion and a 66% increase in NPAT to $549 million. Lake Resources gained 4.65% to 23c, while Galan Lithium fell 3.33% to 72c.
ASX 200 technical analysis
Besides a five-day trading window in late July/early August and two days in early July, the ASX 200 has spent the past five months trading sideways between 7370 and 7050ish. We expect that range to hold for a few more weeks before the ASX 200 makes its move.
ASX 200 daily chart
- TradingView: the figures stated are as of August 31, 2023. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Live prices on most popular markets
- Forex
- Shares
- Indices