• Shares closed flattish as Aussie jobless rate falls to 3.5%
  • Earnings season heats up as a handful of miners give updates
  • China keeps cash rate unchanged, dashing market hopes

 

Local shares closed flat on Thursday as traders assessed the latest jobless figures and what impact they will have on the RBA’s upcoming rates decision.

According to the ABS, Australia’s unemployment rate fell to 3.5% in June (from 3.6% in May), with the economy adding 32,600 jobs during the month. Economists had expected the rate to remain at 3.6%.

This figure and the CPI report next week will be closely analysed when the RBA board meets next on August 1st.

“The RBA’s ‘narrow path’ is widening, as unemployment remains low while inflation continues to fall,” BDO economic research partner Anders Magnusson told the ABC.

On the ASX, Financials and Tech gained, while Healthcare and Comm Services fell.

The best performing large cap today was Leonora gold play Genesis Minerals (ASX:GMD), which rose by 8% on no specific news.

Earnings season meanwhile has begun in earnest as a handful of large caps reported their results (see below section for more).

Elsewhere, China has kept its lending rates unchanged, dashing hopes that a cut might spur economic activity.

Last week, data showed that China’s inflation rate hasn’t moved from a year earlier, fuelling concerns about the lack of domestic demand and a deflation.

“Chinese consumers and businesses continue to hold back on spending with expectations that prices will fall further, raising concerns of price spirals,” said Josh Gilbert, a market analyst at eToro.

 

BIG CAP WINNERS

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Coal stock Stanmore Resources (ASX:SMR) rose after reporting  June quarter production of 5Mt, saleable production of 3.2Mt, and total coal sales of 3.2Mt.

Despite strong production performance, the June quarter end stockpile levels were higher as a result of underperformance of coal logistic chains delaying the recovery of sales volumes after the Q1 wet weather impacts.
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BHP (ASX:BHP) has followed rival Rio Tinto (ASX:RIO) in upping its iron ore output, hitting a fresh record of 285Mt of shipments in FY23 and planning to hit as much as 294Mt in FY24 but as low as 282Mt.

NOW READ: BHP Results: The Big Aussie chases production growth as iron ore, Olympic Dam hit records

Under a revised deal with JV partner Ablemarle, Mineral Resources’ (ASX:MIN) share of the Wodgina lithium mine will increase to 50% and MinRes will remain the operator of the mine.

US lithium giant Albemarle meanwhile will take full ownership of the Kemerton lithium hydroxide plant, which it currently operates.

Albemarle will pay MinRes an estimated US$380-400 million including the net consideration for MinRes’ share of Kemerton and completion adjustments at Wodgina and Kemerton.

Flight Centre (ASX:FLT) has upgraded its FY23 profit guidance, and now expects to report EBITDA of between $295 million and $305 million.

The new midpoint, $300 million, represents a 7% increase on the previous guidance, and a $483 million turnaround on the underlying $183 million FY22 loss.

QBE Insurance (ASX:QBE) reported its half year result. Highlights include gross written premium growth of ~13%. Gross written premium and net insurance revenue are expected to be ~$12.8b and ~$7.9b respectively. Total first half investment income is expected to be ~$660m.

 

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Telix Pharma (ASX:TLX) tumbled -15% despite reporting a solid Q2. Telix said total revenue was up 21%, driven by continued strong growth in Illuccix sales. Net operating cash inflow was $10.8m, an improvement of $8.4m from Q1. The company also reported gross margin of 64% on stable prices and cost of sales.

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