ASX Large Caps: ASX down 0.80%, still doing better than the US and UK

The ASX drops 0.80% with 10 out of 11 sectors in the red
Australia outperforms US and UK markets year-to-date
The mythical soft landing may or may not be in sight, CBA sort of says

Aussie shares dropped 0.80% today, with a whopping 10 out of the 11 sectors falling, led by real estate which lost 2%.

Energy was the only greenery in sight, up 0.95%, probably because global oil prices are still rising after the Organization of the Petroleum Exporting Countries (OPEC) and its Russia-led allies decided to cut production quotas by 2 million barrels per day (bpd).

But Saudi Energy Minister Abdulaziz bin Salman said the real supply cut would be about 1 million to 1.1 million bpd. Saudi Arabia’s share of the cut is about 0.5 million bpd.

And on a positive note, it turns out that for 2022 so far, our share market has out-performed US and mainland European markets despite the war in Ukraine, supply chain issues, rising interest rates, soaring inflation, lingering Covid-business, and floods.

“In an aggregate sense, profits lifted by 56.3 per cent (excluding BHP, up 36.5 per cent),” CBA chief economist Craig James says.

“In fact, all but 8 per cent of full-year reporting companies issued a statutory profit.

“Also 63 per cent of companies lifted profits over the year, above the long-term average of 60 per cent.

“Earnings per share rose by 26.9 per cent. These are remarkable results, highlighting the resilience of Corporate Australia.”

James says solid company and consumer balance sheets, strong job markets and higher commodity prices have all provided support for the broader economy – and thus the share market.

Looking ahead, Commonwealth Bank group economists tip a 25-basis point hike in Australia in November.

Whether or not it will be the last rate hike this cycle remains to be seen, but if lending, spending, employment, and investment really start falling, we could see the legendary ‘soft landing’ that’s every banker’s wet dream.

BIG CAP WINNERS

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Code	Company	Price	%	Volume	Market Cap
SMR	Stanmore Resources	2.605	9%	4,774,355	$2,154,302,258
KAR	Karoon Energy Ltd	2.255	9%	5,983,736	$1,164,754,547
TER	Terracom Ltd	1.135	9%	12,242,805	$835,496,590
ERA	Energy Resources	0.22	7%	228,604	$756,733,556
MSB	Mesoblast Limited	0.98	7%	960,924	$678,151,521
TIE	Tietto Minerals	0.57	6%	34,863,328	$582,944,845
WHC	Whitehaven Coal	10.905	4%	14,378,799	$10,002,601,480
IMU	Imugene Limited	0.1975	4%	5,687,141	$1,190,984,928
MAD	Mader Group Limited	3.02	4%	33,831	$582,000,000
SYR	Syrah Resources	1.795	4%	1,366,728	$1,160,087,328
NWH	NRW Holdings Limited	2.55	4%	1,036,129	$1,105,016,084
AKE	Allkem Limited	14.79	3%	4,435,486	$9,112,134,049
MYX	Mayne Pharma Ltd	0.31	3%	964,590	$521,944,652
TPW	Temple & Webster Ltd	5.88	3%	225,463	$689,092,973

Energy stocks are the main winners today, with Stanmore Coal (ASX:SMR) top of the list after wrapping up its acquisition of the remaining 20% interest in SMC from Mitsui.

“The previous acquisition of BHP’s interest in SMC was transformative for Stanmore,” CEO Marcelo Matos said.

“This current acquisition of the remaining 20% in SMC allows Stanmore to realise the full value of SMC as well as consolidating the operation for administrative and tax purposes. It creates opportunities across all of Stanmore’s assets in the Bowen Basin.”

Karoon Energy (ASX:KAR) also rose after news the Brazilian Government oil and gas regulator – the Brazilian National Agency for Petroleum, Natural Gas and Biofuels (ANP) – approved its updated Baúna Area development plan, which includes the intervention work recently completed and the ongoing Patola development.

Oh and they’ve agreed a reduction in the royalty rate on the incremental production from the BMS-40 license. Noice.

This decision is expected to be formalised in the government gazette in the next few days and will be subject to signing an amendment of the current concession contract.

And lithium player Allkem (ASX:AKE) announced a US$200 million finance facility for the first stage of the development of its Sal de Vida mine in Argentina from the World Bank’s International Finance Corporation.

“We are already in a strong financial position to self-fund the Sal de Vida project however we saw an opportunity to further improve the financing structure for Sal de Vida and partner with IFC, an institution with decades of experience providing finance and sustainable business solutions in the mining space,” Allkem boss Martin Perez de Solay said.

Sal de Vida is expected to produce 15,000tpa of mostly battery grade lithium carbonate at a capital cost of US$271m, with construction started in January this year and first production due in the second half of 2023.

BIG CAP LOSERS

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Code	Company	Price	%	Volume	Market Cap
PAR	Paradigm Bio.	1.665	-14%	913,350	$539,651,702
ILU	Iluka Resources	9.34	-6%	2,348,765	$4,232,324,224
5EA	5Eadvanced	1.825	-6%	285,619	$555,205,903
ECX	Eclipx Group Ltd	2	-6%	578,139	$626,757,802
INR	Ioneer Ltd	0.6325	-6%	4,294,295	$1,405,749,831
STA	Strandline Res Ltd	0.425	-6%	1,498,874	$562,224,899
MCR	Mincor Resources NL	1.75	-5%	1,903,522	$900,743,845
DYL	Deep Yellow Limited	0.83	-5%	1,130,158	$640,103,835
MAF	MA Financial Group	4.04	-5%	74,003	$746,105,562
MP1	Megaport Limited	8.32	-4%	453,011	$1,377,618,152
HUB	HUB24 Ltd	22.31	-4%	122,450	$1,860,552,057
CIA	Champion Iron Ltd	5.245	-4%	725,912	$2,823,874,468
GQG	GQG Partners	1.535	-4%	211,454	$4,709,724,667
SGF	SG Fleet Group Ltd	2.05	-4%	126,176	$728,427,880
VUL	Vulcan Energy	7.34	-4%	225,355	$1,092,214,994