Good Evening,

Welcome to Equity Espresso

We’re here to catch you up on all the day’s news in Australia and abroad.

Here’s a sample of what you may have missed today:

1. 👷‍♂️ Aussie Job Surge

2. 📈 Sticky U.S. Inflation

3. ☢️ Uranium Glows Brighter

4. 🛒 Myers Cautious Outlook

5. 🛫 NAB Waves Goodbye to Hong Kong

The Recap

ASX Gains Led by Materials Sector As Uranium Hits Record

The ASX200 index rose by 41.2 points. to close at 7,195.1 in a day dominated by Materials and Energy stocks. The Materials sector led the index as Iron Ore future prices crossed US$120.0 a tonne, which drove BHP (+0.8%), Fortescue (+4.1%) and Rio Tinto (+1.8%) all higher.

The Energy (+0.4%) sector also finished in the green as the oil price remained steady, with West Texas Intermediate trading near $US89 a barrel. Also contributing to the rise were Uranium companies, which rocketed today as the Uranium price rose to US$62.00 L/bs, its highest point since 2011. This was helped by a favourable report from the World Nuclear Association, which forecasts strong demand for the commodity through to 2040. More on Uranium in the ‘Biggest Winners’ section

Employment data come in slightly hotter than expected in August after a dip in July, as the unemployment rate remained steady at 3.7%.

Economic News

• Aussie unemployment remained steady at 3.7% for August, while employment rebounded with 64,900 jobs created, smashing forecasts estimates of 23,000. “The large increase in employment in August came after a small drop in July, around the school holiday period,” said Bjorn Jarvis, ABS head of labour statistics. The two-month average employment growth was around 32,000, similar to the average growth over the past year.

• The U.S. headline inflation increased by 3.7% compared to last year, exceeding the predicted rate of 3.6%. The Core Consumer Price Index (excluding food and energy) rose by 4.3% annually and 0.3% monthly, which was in line with the expected 4.3% but higher than the predicted 0.2%.

ASX200 Stock Snapshot

Wall Street

It was a mixed night for U.S. markets, with the Dow Jones finishing lower and the S&P500 & NASDAQ trading higher. The Utilities (+1.2%) and Consumer Discretionary (+0.9%) led the gains, while Real Estate (-1.03%) was the biggest laggard after a higher-than-expected inflation read strengthened the case of rate hikes by the Fed.

In company news, American Airlines tumbled 5.7% after it slashed its third-quarter profit estimates due to higher fuel prices and costs from a new pilot labour agreement. Low-cost carrier Spirit Airlines fell about 6.3% after cutting its summer profit estimates due to higher costs.

UBS upgraded car makers Ford and General Motors to a ‘Buy’ rating, with the stocks climbing 1.5% and 0.6%, respectively.

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Quick Singles

🪃 Local News

• The National Australia Bank has decided to close its office in Hong Kong, citing the preference for Shanghai, Singapore, and Tokyo as the primary regional centres to support its institutional banking clients in Asia. The bank currently employs approximately 50 staff members in Hong Kong's Wan Chai office, who were informed of the unexpected news during a meeting on Wednesday. NAB has not yet determined how many employees will be made redundant or offered positions at its other regional offices.

• Atturra and Cirrus both went into a trading halt today, pending the release of an update related to Atturra’s takeover of the IT services company.

• Sezzle confirmed that it will re-commence trading on the NASDAQ after being put on a trading halt on August 17 by the stock exchange due to an inadequate supply of publicly traded common stock. Since the halt, the number of eligible common shares available to trade has increased to 536,188.

• DownerEDI announced it has been selected to deliver the Planning Phase of the ADF’s proposed Woomera Redevelopment program in South Australia. Planning will commence this month, with the estimated value of the contract between $500 million - $750 million. The revenue will be split 50:50 between Downer and Joint Venture partners CPB contractors. Pending government and parliamentary approvals, the project will begin in early 2026 and is expected to be completed by early 2029.

• Ramelius Resources has increased its gold reserves by more than 20%. In its latest estimate, the miner increased its mineral reserves estimate by 23 per cent to 7.6 million ounces of gold.

• Sandifre has increased its finance facility from US$140 million to US$200 million to support the expansion of its Motheo copper mine in Botswana. The processing capacity of the mine will expand from 3.2Mtpa to 5.2Mtpa. (millions of tonnes per annum) by the end of the December qtr.

• Yellow Brick Road shares were placed in a trading halt pending an application to be removed from the ASX.

🌏 Around The Globe

• Ford plans to double the production of its F-150 pickup truck's hybrid version due to lower sales of its electric vehicles. The automaker aims to raise the sales of its V-6 hybrid model to around 20% in the U.S. during the 2024 model year.

• Meta-owned Threads is blocking searches related to COVID amid an uptick in infections, saying it temporarily won’t provide results that may contain “potentially sensitive content.”

• McDonald’s has said that by 2032, all U.S. locations will remove self-serve soda machines due to declining dine-in customers.

• Lyft announced a new feature that will help match female drivers with female passengers to improve safety and attract more women to the app.

• Amazon plans to boost wages for contracted drivers as part of a $400 million investment into its third-party delivery program. However, it didn’t confirm how much the pay would increase.

• Chip Designer Arm Holdings has priced its U.S. initial public offering (IPO) at $51 per share, valuing the company at $54.5 billion. Trading is set to begin on Thursday.

• BP CEO Bernard Looney resigned for failing to disclose details of past personal relationships with colleagues.

₿ Crypto Corner

• Co-founder of the fraudulent OneCoin cryptocurrency, Mark Greenwood, has been sentenced to 20 years in prison. Meanwhile, his partner and the so-called "Cryptoqueen Ruja Ignatova remain at large. The massive pyramid scheme amassed over $4 billion from millions of victims worldwide.

• The SEC has accused Stoner Cats, the organisation responsible for creating the NFT-driven cartoon project, of peddling unregistered securities during the NFT launch in 2021. Stoner Cats 2 LLC has agreed to a cease-and-desist order and will pay a $1 million civil penalty without accepting guilt.

Markets

Index & Commodity Prices

Bond Prices

ASX By Sector

ETF Watch

Newsletter Recommendation

Movers and Shakers

✅ Biggest Gainers

The price of Uranium crossed a 12-year high, continuing its recent upward trajectory, to trade at US$62/Lbs currently. The price of Uranium is now up by over 24% since March this year.

European power and U.S. utility companies are supporting the recent price hike due to decreasing energy inventory levels. European power companies' inventory levels have declined from 140 million pounds to an estimated 90 million pounds, while US utility inventories have decreased from 125 million pounds in 2016 to approximately 101 million pounds.

The drop is a result of power companies burning more fuel than they are purchasing, leading to a shortage in the market. This shortage is causing them to compete with fund buying, making the market even tighter.

Some of the ASX-listed companies with exposure to Uranium that rose today included Paladin Energy (+3.9%), Boss Energy (+8.8%), Deep Yellow (+8.2%) and Bannerman Energy (+10.8%).

🔻Biggest Fallers

The only significant downward movers on the index today were companies trading ex-dividend. Check out the extras section below to see which companies dropped the most.

Deep Dive

Myer's FY23 Results:
A Mixed Bag Amid Economic Challenges

The retailer announced its FY23 earnings today, which were previously highlighted in an August trading update. Both sales and profit have increased, but there was a slowdown in Q4 due to a weaker macroeconomic outlook.

Financial Highlights

• Sales of $3,362.9 million - 12.5% growth year-on-year.

• H2 sales grew by only 0.4% growth, with a slowdown in trading conditions during Q4, which the company attributed to macroeconomic factors.

• Net Profit After Tax (NPAT) was $71.1 million, which includes implementation costs and individually significant items amounting to $10.7 million.

• Group online sales were $690.5 million, making up 20.5% of the total sales. This was down 4.5% from the previous year, which can be attributed to mandatory store closures during Q1 of FY22, which forced consumers online.

• Fully franked final dividend of 1.0 cent per share, making the total FY23 dividends 9.0 cents per share, a significant increase from the 4.0 cents per share in FY22.

John King, Myer’s CEO, highlighted the company's multi-channel offer as a significant strength, with the online segment showing growth in the second half of the year. King also emphasised the company's strategic investments in store formats, technology, and merchandise, including introducing new brands like the Country Road Group and American Eagle.

Myer's Customer First Plan seems to be at the heart of its strategy. The plan has driven sales to their highest level since 2005, with total sales of $3.36 billion. The company's loyalty program, MYER One, has seen a growth of 720k new members, a 21.4% increase, resulting in a total of 4.2 million active members over the past year.

Myer remained cautious in its outlook:

“Like all retailers, we continue to remain cautious about the macroeconomic environment. However, we are pleased with our strong results at the half and the full year, and have a strong program of deliverables to roll out in FY24 as part of our customer-first plan,” Mr King said.

Daily Quiz

Test Your Knowledge

Yesterday’s Daily Quiz Question: Every Apple iPhone ad displays what time?

Answer: 9:41 AM. A tricky one, with only 23% getting it correct. 11:37 a.m. was the most popular answer, with 46% of the vote.

As was mentioned in the hint, the use of that exact time is in homage to Steve Jobs' announcement of the iPhone at MacWorld 2007.

A Little Extra

📉 Going Down?

Top 10 shorted stocks on the ASX - as of September 8

1. Pilbara Resources (PLS) - 10.33%

2. Flight Centre (FLT) - 9.76%

3. Syrah Resources (SYR) - 9.50%

4. Elders Limited (ELD) - 9.14%

5. IDP Education (IEL) - 8.22%

6. Core Lithium (CXO) - 7.70%

7. Brainchip (BRN) - 7.34%

8. Select Harvests (SHV) - 7.34%

9. Mesoblast (MSB) - 7.30%

10. LendLease Group (LLC) - 7.24%

📊Broker Ratings

What do the brokers have to say?

1. Baby Bunting (BBN) - Upgraded to Buy from Neutral (Citi). Target Price $2.30

2. Incitec Pivot (IPL) - Downgraded to Equal-weight from Overweight (Morgan Stanley). Target Price: $3.23.

👨‍💼 Director Transactions

What are the insiders doing? (On-market only)

💲Dividends

Companies trading ex-dividend today

📅 Economic Calendar

Data to keep an eye on this week

DISCLAIMER: None of the information provided in this newsletter should be constituted as financial advice. This newsletter is strictly for educational purposes only. It should not be taken as investment advice or a solicitation to buy or sell assets or make financial decisions. Please do your research.