ASX 200 trims gains but holds above 8000; CBA's new high; ABB slumps; Lifestyle Communities dives

China GDP slows more than expected. Aussie Broadband dives. CBA's new intraday record: $133.30. Lifestyle Communities tanks on VCAT allegations. Rio, BHP rise on Canadian dealmaking reports. 

Global and local economic and political developments will keep investors on the go this week. Picture: Nikki Short

Welcome to the Trading Day blog for Monday, July 15. The ASX 200 index closed at a record high after rising 0.7 per cent to 8017.60 points.

The Aussie dollar is near US67.74c at 5.30pm AEST.

Updates

4:28 pm July 15, 2024

ASX 200 ends up 0.7pc at record high close

David Rogers

Australia's share market rises strongly for a third consecutive day.

The S&P/ASX 200 index ends up 58.3 points or 0.7 per cent at a record high daily close of 8017.6 after surging to 8037.3 in early trading.

Trading value was light amid NSW school holidays and a public holiday in Japan.

The local stock market continued to rise after US inflation data last week reinforced the cash for the Fed to start cutting interest rates, causing gains in most US stocks and a rotation away from tech giants. US stock index futures added to Friday's positive leads from Wall Street despite the assassination attempt on Mr Trump.

Broad-based gains were led by tech, consumer discretionary, and communications, with WisTech up 2.5 per cent, Wesfarmers up 2.1 per cent and Seek up 4 per cent. CBA hit a record high of $133.30 before closing up 0.8 per cent at $132.69.

James Hardie rose 2.5 per cent, Cochlear gained 2.4 per cent and RedMed rose 2 per cent. CSL closed up 0.6 per cent after rising 1.5 per cent in early trading.

Lifestyle Communities dived 18 per cent after noting that complaints from some homeowners were aired on the ABC.

China's GDP and retail sales were weaker than expected as China's Third Plenum meetings got under way. The meetings were due to conclude on Wednesday.

Fed chair Powell speaks at the Washington Press Club overnight.

1:49 pm July 15, 2024

ASX 200 trims rise to 0.5pc; CBA fades

David Rogers

Australia's share market trims half of its strong intraday rise to a fresh record high as the financials, materials and health care sectors cool.

The S&P/ASX 200 index is up 0.5 per cent at 8002.6 after rising to 8037.3.

Banks, iron ore miners and CSL account for most of the intraday fade.

CBA is up account 0.2 per cent after rising as much as 1.2 per cent.

Rio Tinto is up 0.1 per cent after rising as much as 1 per cent.

CSL is up 0.1 per cent after rising as much as 1.5 per cent.

1:26 pm July 15, 2024 Highlight

APM secures debt back-up as Madison talks continue

Valerina Changarathil

Services provider APM Human has lined up financing out to 2030 as talks with US-based 29 per cent shareholder Madison Dearborn Partners (MDP) to privatise the business for $1.3bn ($1.45 per share) continue.

APM has now signed a "committed letter" with Goldman Sachs for new facilities of up to $950m for the purposes of retiring its existing syndicated corporate facility. The new facilities provide APM with long term and flexible financing on similar terms to the MDP acquisition facility, which also includes additional funding capacity for APM’s future capital and growth expenditure, and working capital requirements up to $1.31bn.

"This commitment from Goldman Sachs enables APM to immediately extinguish and replace its existing facilities in the event the scheme (with Madison) does not proceed," the group told investors. If the scheme proceeds, the Madison acquisition facility will extinguish the existing facilities.

APM and MDP continue to work together in relation to key conditions precedent to the scheme, including regulatory approvals and customer contract consents, which "are progressing well". Shareholders will get to have a say on the deal in September with the independent board committee still recommending a yes vote in the absence of a superior bid and the independent expert's concluding the deal is in the best interests of APM shareholders. The IBC makes no recommendation in respect of the scrip alternative.

Executive chair Megan Wynne and chief executive Michael Anghie are also backing the MDP offer. A scheme booklet is expected to be dispatched to APM shareholders in August with financial results due on August 30.

12:44 pm July 15, 2024

ASX 200 up 0.9pc after fresh record high

David Rogers

Australian stocks continue to surge after last week's US inflation data.

US CPI and PPI data reinforced the case for US interest rate cuts, prompting some rotation from US tech giants that could finding its way into Australian stocks.

The S&P/ASX 200 is up 0.9 per cent to 8029.3 points after hitting a record high of 8037.3. It has soared 2.7 per cent in three days versus 0.7 per cent for the S&P 500.

Tech, communications, consumer discretionary, materials lead broad-based gains with WiseTech up 2.3 per cent, Seek up 3.7 per cent, Wesfarmers up 2.1 per cent and Fortescue up 2.4 per cent. Major banks rise 0.5-1.1 per cent led by NAB.

12:35 pm July 15, 2024

Cat Rock tips in millions for Cettire boost

Valerina Changarathil

Cettire's US-based investor Cat Rock Capital has now cornered a 15.4 per cent stake in the embattled online luxury retail group through its months-long prolific on-market purchases.

The group tipped in more than $3.4m on Thursday and Friday last week, closing off on the purchase of 4.96 million shares since June 5.

The group now controls 58.7 million shares – a substantial jump since November 2023 when it held 35.7 million shares, or about 9.4 per cent of the group run by reclusive entrepreneur Dean Mintz. Cettire last week tapped investment banker Jon Gidney as a non-executive director, amid a tough operating climate and jump in short-selling interest in the stock.

12:13 pm July 15, 2024

China GDP slows more than expected

David Rogers

China's economic growth slows a bit more than expected and retail sales are weaker than expected in the latest data released Monday.

June quarter GDP rises 4.7 per cent on-year versus 5.1 per cent expected while year-to-date GDP rises 5.0 per cent versus 5.0 per cent expected.

The annual growth rate of GDP is the lowest since the March quarter of 2023.

June retail sales rises 2.0 per cent on-year versus 3.4 per cent expected.

The annual growth rate of retail sales is the lowest since December 2022.

June industrial production rises 5.3 per cent versus 5.0 per cent expected.

June fixed assets ex-rural investment rises 3.9 per cent on-year as expected.

It comes as China's Third Plenum policy meeting starts Monday.

10:53 am July 15, 2024 Highlight

Lifestyle Communities tanks on VCAT allegations

Valerina Changarathil

Shares in mid-cap developer Lifestyle Communities are down nearly 8 per cent to $11.60 at 10.45am AEST after it rejected allegations made by some homeowners at its Wollert project in northwest Melbourne.

Lifestyle Communities said it has "been engaging" with the group of homeowners since February. The homeowners have "not been satisfied with our responses" and have made applications to the Victorian Civil and Administrative Tribunal (VCAT).

The group said it rejects the allegations made in relation to its deferred management fees in the VCAT applications and will defend them accordingly.

"Deferred management fees are permissible in all states except for South Australia. In Victoria, most land lease operators charge a deferred management fee," LIC told investors on Monday. "The group members that we met with acknowledged that they fully understood that the DMF was in their site agreements and was payable as a percentage of their resale price when they moved out."

10:39 am July 15, 2024

ASX 200 on track for 8,250 target: Betashares

David Rogers

The ASX 200 is likely to hit 8,250 points by year end, according to Betashares chief economist, David Bassanese.

"Being relatively cheap and unloved, the Australian market could become part of the ‘great rotation’ if global investors start to seek opportunities outside of US large cap technology stocks such as Nvidia," Bassanese says.

With increased signs of reduced inflation pressure in the US and Fed rate cuts expected to start soon, Bassanese says there's "still a chance the RBA could hold off hiking rates in August even if the CPI is again a bit higher than expected."

But he adds that a resumption in the disinflation process in Australia can’t come soon enough, lest the RBA risk tipping the economy over the edge.

"We can only hope the June quarter CPI in two and a half weeks’ time is benign," he adds.

Betashares forecast implies a further 2.7 rise from the current level.

The S&P/ASX 200 is up 1 per at a record high of 8035.4 at 1038am AEST.

10:29 am July 15, 2024 Highlight

Aussie Broadband slumps on Buddy details

Valerina Changarathil

Shares in internet services provider Aussie Broadband are taking a beating after the group updated investors on earnings guidance and forecast a $10m spend on its new digital 'challenger brand' Buddy, aimed at disrupting the value-seeking NBN market in Australia.

ABB shares have slumped 18.2 per cent to $2.92 at 10.25am AEST.

FY24 unaudited earnings before interest, taxes, depreciation and amortisation is tipped to come in at the top end of its guidance of $116m to $121m, including four months of contribution from Symbio.

In addition, ABB expects to invest approximately $10m in FY25 to support marketing, brand and set up/one-off related operating expenditure to support the Buddy launch. It expects Buddy will provide positive EBITDA contribution from FY27 onwards. Prior to the impact of Buddy Telco, the FY25 EBITDA guidance range is $135m-$145m, an increase of between 12 per cent and 20 per cent from the top of the FY24 guidance range. Including the impact of Buddy, EBITDA guidance is for $125m to $135m.

Capex guidance is $55m to $60m, inclusive of capitalised software development costs, and is about $8m lower due to excess capacity becoming available on the network following the migration of Origin customers.

Full year audited results are due on August 26.

10:22 am July 15, 2024

ASX 200 rises 0.9pc to record high

David Rogers

Australia's share market rises strongly to a record high for a second day running.

The S&P/ASX 200 index is up 0.9 per cent to 8031.7 points, exceeding expectations based on Friday's gains in global markets.

The health care, consumer discretionary and financials sectors lead broad-based gains as CSL climbs 1.3 per cent, Wesfarmers adds 1.7 per cent and major banks rise 0.8-1.4 per cent led by NAB. CBA jumps 1.2 per cent to a record high of $133.25.