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Morning Update: S&P/ASX 200 (INDEXASX:XJO) drops below 7,000

The wall of worry continues to pressure the Australian share market with the escalating conflict sending both the S&P/ASX200 (INDEXASX: XJO) share price and All Ordinaries (INDEXASX: XAO) share price more than 1% on Thursday.

Falling 1.4% and 1.3%, respectively, every sector finished weaker with utilities the ‘outperformer’ by dropping only 0.3% as Origin Energy Ltd (ASX: ORG) held ground gaining 0.1% after Grant Samuel increased its estimated valuation of the business.

Origin Energy share price

Telix Pharmaceuticals Ltd (ASX: TLX) share price fell by more than 10% after the company released results from a preliminary trial of its prostate cancer drug that didn’t live up to expectations.

On the positive side, gold miner Northern Star Resources Ltd (ASX: NST) benefitted from both the surge in demand for safe haven assets while also confirming production guidance for FY24; share prices gained more than 4% on the news.

The unemployment rate fell once again, hitting 3.6%, but in this case, it was due to another 13,000 leaving the work force altogether, rather than finding new jobs.

Weebit Nano jumps on chip deal: Woolworths PETstock deal snagged

Weebit Nano Ltd (ASX: WBT) which develops semiconductor memory technology announced a major commercial agreement with DB HiTek Co Ltd (KRX: 000990), one of the world’s largest foundries. While not disclosing the value of the deal, it represents a significant win for the group with share price gaining 6.8%.

Share prices in Woolworths Group Ltd (ASX: WOW) were dragged lower by the risk off sentiment, but Woolworths has seen progress in its acquisition of the PETstock franchise. After raising competition concerns, the group  announced plans to divest 41 stores and veterinary hospitals to ensure that the deal goes ahead as planned after Woolies purchased 55% of the company in 2022.

Woolworths share price

Furniture retail Nick Scali Limited (ASX: NCK) share price finished broadly flat after the company delivered a better-than-expected update to the market. September sales were down 5.4% on 2022 levels, much better than expected, and while store traffic has reduced by as much as 15%, conversion rates continue to improve.

The result expected to be a profit exceeding $40 million, comparing positively to the $38.6 million previously forecast.

Netflix jumps on subscriber gains: Tesla announces new launch

All three US benchmarks finished lower on Thursday, as comments from Federal Reserve chair Jerome Powell suggested that inflation remains too high but that bond yields may be slowing the economy and financial system enough. The result was a 0.8% fall in the Dow Jones Industrial Average (INDEXDJX: .DJI) share price, 0.9% in the S&P 500 (INDEXSP: .INX) share price and 1% in the Nasdaq Inc (NASDAQ: NDAQ) share price.

Strong employment data continues to feed through offering hope that a recession will be avoided, this time just 198k claimed unemployment benefits.

Netflix Inc (NASDAQ: NFLX) and Tesla Inc (NASDAQ: TSLA) were among the key earnings reports overnight with the former surging 10%.

Netflix share price

Netflix reported 8.86 million new subscribers during the quarter, 30% higher than estimates and a surge in ad-supported options, which now make up 30% of revenue.

Tesla share price on the other hand fell by 10% after the company announced the long awaited Cyber Truck would be ready by 30 November, but that it was unlikely to add to cash flow for several years.

The Golden Rules of Investing

We might be experts in retirement, but with combined financial advice experience of 35+ years, we’ve nearly seen it all. 

In mid-2023, our senior team at Wattle Partners Financial Planning put the finishing touches on a brand-new report “The Golden Rules of Investing“.

In this free report, we outline the key principles that determine all of the portfolio construction and investment decisions of Wattle Partners. Collated over decades, this paper should be seen as a work-in-progress, constantly under review in light of the ever-evolving nature of markets. 

You’ll find the free report on my Author page. Simply click the button below to view the Golden Rules.

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At the time of publishing, the author or their clients may have a financial interest in some of companies or securities mentioned.

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Wattle Partners is a financial advice firm, servicing clients around Australia, specialising in retirement planning (pre and post retirement). 

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