The S&P/ASX 200 added 0.9 per cent at 12pm (AEDT) as the tech sector jumped 5.9 per cent and consumer discretionary added 2.6 per cent in a busy day for corporate profit reports.
The jobless rate for January jumped to 4.1 per cent in a slowdown that led traders to fractionally lift rate cut pricing.
“A higher jobless rate allows for greater consideration of a rate cut, and it means the economy is moving in line with expectations for inflation to slow,” said Sean Sequeira, chief investment officer at Australian Eagle Asset Management.
On the sharemarket, a $9.1 billion takeover bid for Altium at a premium close to 39 per cent helped push software peers Wisetech and Xero both up nearly 4 per cent. Altium’s shares soared 28 per cent to $65.82.
“It’s a big takeover premium at the higher end of top 100 takeovers in Australia,” said Mr Sequeira. “Usual premiums are around 20 per cent and this is much bigger, and it’s not like Altium’s been underperforming.
“It was designed as a knockout bid, noting Altium was bid for before and rejected. Altium’s management have worked with Renesas for a couple of years and this endorses management’s views they can build a platform to revolutionise printed circuit board manufacturing.”
BHP flagged what Citi called “big exceptional charges” for the first half of financial 2024, as it impaired the value of its West Australian nickel assets by $US2.5 billion and upped provisions for the Samarco dam disaster. The shares fell 2.3 per cent to $44.89.
Wesfarmers added 3.3 per cent on its profit report and fund manager Magellan gained 4.8 per cent on a profit beat.
On Wall Street, the S&P 500 topped 5000 points at the closing bell amid broad gains for the sharemarket.
Stocks in focus
Whitehaven Coal slashed its dividend to 7¢ on lower coal prices and the need to fund an acquisition. The stock dropped 6.8 per cent to $95.91.
Pro Medicus sunk 11.3 per cent to $95.91 despite the company lifting its interim net profit 33.3 per cent in line with analysts’ consensus expectations.
Telstra trimmed full-year earnings guidance as the telco overhauls its enterprise business after delivering an 11.5 per cent rise in interim net profit to $1 billion. The stock lost 1.9 per cent to $3.915.
Origin Energy climbed 2.6 per cent to $8.795 after the company posted a 17-fold increase in benchmark net profit for the first half, aided by higher prices for customers, but has signalled earnings from its core energy markets business will be lower next financial year as tariffs decline.
Wesfarmers rallied 4.9 per cent to $61.805 after the Bunnings owner maintained its profit and revenue levels in the first half, despite a weakening outlook for its lithium segment. Net profit rose 3 per cent to $1.4 billion for the six months through December. Revenue rose 0.5 per cent to $22.6 billion.
Penfolds owner Treasury Wine Estates rose 2.9 per cent to $11.39 despite the company reporting a hefty fall in profits for its US wine business. The company, which provided a more upbeat outlook for the second half, also trimmed its first half dividend to 17¢. Net profit slipped 11.4 per cent to $166.7 million.
“The outlook for Treasury for a better second half shows it believes its business will improve, and it could be potentially restructured to separate it into a luxury division producing 75 per cent of EBIT and a premium division, which could set up to sell the premium business Penfolds in the luxury unit as a larger proportion of business,” Mr Sequeira added.
Goodman Group has reported a 29 per cent jump in half-year operating profit to $1.1 billion, but also a statutory loss of $220.1 million due to hefty write-downs on its real estate assets. The shares atill rose 7.1 pe cent to $28.485.
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