The Monday Report – 19 October 2020

Daily Market Reports | Oct 19 2020

By Greg Peel

Solid Week

It was a Friday kind of Friday on Friday as the ASX200 opened lower and continued to drift away to the close. It had been a strong week, providing an opportunity to lock in ahead of the weekend, and the index still managed to clock a 1.2% weekly gain.

There remains much to be concerned about globally. Here we’re still fretting over single-digit case-counts while countries across Europe are posting new record counts, including in the UK, where a no-deal Brexit is appearing ever more likely as well.

The daily case-count in the US is now more than double what it was at its lowest ebb, yet still this doesn’t seem to much worry Wall Street, which continues to put faith in a vaccine. Nor is stimulus a problem as (a) whoever wins the election will provide it and (b) if there is a vaccine by inauguration, it may not be needed.

One thing we know for sure is that international borders will be closed for a very long time. And look what happens when you let in bloody Kiwis.

All sectors closed lower bar two on Friday and those closing lowest were those having enjoyed a strong week.

Consumer discretionary rose 0.2%, aided by a solid trading update from GUD Holdings ((GUD)), which was worth 6.3% and silver on the winners’ board, with the bronze going to Super Retail ((SUL)) with 4.7% and just out of the medals, Corporate Travel Management ((CTD)), up 3.3% for some reason.

IT rose 0.3%, which is neither here nor there.

Gold medallist on the day was UR Westfield ((URW)), bucking the trend of weakness in the property sector (-2.1%) in rising 12.1% after an investor group declared it would oppose a proposal to sell EUR3.5bn worth of stock, which would include a sale by the former CEO.

Beyond property, energy (-1.1%), materials (-0.7%) and healthcare (-0.7%) were the worst performers having otherwise risen over the week, while the banks sat it out.

The worst performing stock was REIT GPT Group ((GPT)) down -4.7%. Also making that top five were Whitehaven Coal ((WHC)), back in selling mode down -3.8%, and Atlas Arteria ((ALX)), down -3.6% as France locks down once more.

The good news over the weekend is Melbournians can now travel 25km for a haircut and few more can attend regional pubs. Bad luck for other retailers, but it’s all slowly heading in the right direction.


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