Good Evening,

Welcome to Equity Espresso’s Daily Recap.

The Aussie market started the week positively, with the ASX 200 index edging up 0.20% or 15.8pts. higher to 7,789.10 following a positive lead from Wall Street on Friday and a flurry of company news.

Nine of the 11 major sectors finished higher, with Technology (+1.19%) and Utilities (+0.83%) leading the charge, while Energy (-1.24%) and Staples (-0.98%) stocks closed lower.

Coles (-1.22%), Woolworths (-0.28%), and Metcash (+0.51%) had mixed results today following an interim report from the former competition minister suggesting that the industry code of conduct should be made mandatory. The report proposed that major supermarkets with more than $5 billion in annual revenue should face significant fines if they fail to comply with the industry code of conduct. According to the report, companies could be fined up to A$10 million or 10% of their revenue if they do not comply with the code, which is currenlty voluntary.

Falling oil prices dragged the Energy sector lower, with WTI crude futures dropping by more than 2% to around US$85/bbl on Monday. Woodside Energy (-1.63%) was one of the bigger fallers, followed by Santos (-1.01%) and Ampol (-0.61%).

In company news, Life 360 (+16.80%) was the best performer on the ASX200 index after reporting that it had added 4.9 million net new users during the first quarter of FY24, taking its total monthly active users to 66.4 million as of the end of March. Qoria (+33.33%) shares spiked to close at $0.42 after the technology company rejected a takeover proposal from K1 Investment Management valued at $0.40 per share.

APM Human Services (-29.45%) took a tumble after providing a trading update stating that it anticipates Net Profit to be between $95 million and $105 million, falling below market expectations. APM also said that it had received a non-binding takeover offer from Madison Dearborn Partners for $1.40 per share, which currently owns a 29% stake in the company. APM shares closed at $1.145 per share.

Elders (-24.42%) shares plummeted after the company reported that first-half trading for FY24 was “significantly below expectations” due to the impact of El Niño, low farmgate prices, and sustained margin pressures. Underlying EBIT is expected to be between $120 million and $140 million for FY24, down from $170.8 million in FY23. Beach Energy (-15.04%) sank after it said it expects costs at its Waitsia gas plant to increase by $200 million following the discovery of quality-related problems at the site.

Ansell shares went into a trading halt today after the company announced the acquisition of Kimberly-Clark Corporation’s PPE business in a deal worth US$640 million. To partially fund the deal, Ansell will raise $400 million from institutional shareholders at $22.45 per share - a 6% discount to its last closing price of $23.89 on Friday. Retail holders will also be able to participate in a further $65 million capital raise.

Wall Street

U.S. stocks finished higher on Friday after a strong jobs report reinforced the view that the economy remains healthy despite the possibility of a delay in the rate rate-cutting cycle. The NASDAQ (+1.2%) was the best performer of the leading indices, followed by the S&P 500 (+1.1%) and the Dow Jones (+0.8%).

All the major S&P 500 sectors advanced, with Communication services (+1.61%), Industrials (+1.43%) and Technology (+1.38%) being the top gainers.

For the week, the Dow Jones fell 2.3%, the S&P 500 dropped 1%, and the Nasdaq declined 0.8%.

Markets are now pricing in around two rate cuts this year, down from three a few weeks ago, according to data from LSEG.

Tesla (-3.63%) stock fell after Reuters reported that the electric vehicle maker had scraped plans for a low-cost vehicle.

S&P500 Sector Performance

Economic Data

• The U.S. economy added 303,000 jobs during March, smashing forecasts of 200,000 and up from 270,000 in February. This was the highest mark in ten months.

• Canada’s Unemployment Rate rose to 6.1% in March from 5.8% the prior month and above forecasts of 5.9%. The reading is the highest since October 2021.

• Euro Area Retail Sales fell by 0.5% month-on-month in February after being unchanged in January, above estimates of 0.4% fall.

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Quick Singles

🌎️ Around The Globe

• Royal Bank of Canada has terminated the employment of Chief Financial Officer Nadina Ahn and appointed Katherine Gibson in her place. The change came after the bank became aware of allegations that she had an "undisclosed close personal relationship with another employee.”

• According to a report by Reuters, Tesla has cancelled its low-cost vehicle and will instead focus on self-driving taxis. In response, CEO Elon Musk tweeted, “Reuters is lying (again).” Meanwhile, Tesla announced that it will unveil its robotaxi on August 8.

• Samsung is planning to double its investment in Texas, according to a report by The Wall Street Journal. The expansion will include a new chip manufacturing facility, a packaging site, and a research and development space. This will bring the total investment in the state's chip-manufacturing sector to $44 billion.

• Alphabet is reportedly discussing making an offer for Hubspot, an online marketing software company currently valued at $33 billion. Should the deal go ahead, it would be Alphabets’s largest-ever acquisition.

• YouTube has warned that Open AI’s potential use of YouTube videos to train its text-to-video generator, Sora, would clearly violate its terms of service.

• Tesla is raising its compensation for artificial intelligence engineers to ward off poaching from other companies. Elon Musk says the competition for AI engineers is the craziest talent war he has ever seen.

• Zimbabwe is replacing its collapsing local currency with a new one backed by gold and foreign currencies, which it hopes will be more stable and help bring down inflation.

Markets

ASX Company Movers

Commodity Prices

Bonds

Forex

ETF Watch

Global Health Check

A Little Extra

📉 Going Down?

Top-10 shorted stocks on the ASX - as of April 2

📂 Broker Ratings

1. Bank of Queensland (BOQ) - Downgrade to Reduce from Hold (Morgans)

2. Capricorn Metals (CMM) - Downgrade to Underperform from Neutral (Macquarie)

3. Macquarie Group (MQG) - Downgrade to Sell from Neutral (Citi)
   

👨‍💼 Director Transactions

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

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