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Markets Live: ASX set to gain as fears over Hong Kong, Brexit ease

Department store giant Myer has posted a better-than-expected full-year result, with net profit after tax up 2.2 per cent to $33.2 million, partially due to soaring online sales.

Total revenue decreased 3.5 per cent to $2.99 billion, beating consensus estimates which forecast a 5.1 per cent drop. Earnings before interest, tax, depreciation and amortisation also beat estimates, up 7.2 per cent to $160.1 million.

Comparable store sales also decreased less than expected, coming in down 1.3 per cent compared to the 1.9 per cent drop analysts had predicted. Online was a point of significant growth for Myer, with digital sales up 21.9% to $292.1 million, making up 9.8 per cent of total sales and matching the number of sales Myer makes at its largest store.

Myer chief executive John King labelled the result as “disciplined”, with the company reducing costs by $32.6 million over the year through reduced store occupancies and a new in-store staffing model, but warned of headwinds in the year to come.

“In the first year of the Customer First Plan, we have progressed a number of strategic initiatives, but recognise there is much more to be done to transform this business in the interests of customers and shareholders,” Mr King said.”We anticipate the challenging macro environment and subdued consumer sentiment to continue during FY2020.”

By Dominic Powell. 

IG MARKETS SPONSORED POST

S&P/ASX 200 futures point to a gain of 19 points, or 0.3 per cent, to 6555.

  • AUD +0.5% to 67.96 US cents
  • On Wall St 4pm: Dow +0.9% S&P 500 +1.1% Nasdaq +1.3%
  • In New York: BHP +3.5% Rio +3.3% Atlassian -1.6%
  • In Europe: Stoxx 50 +0.9% FTSE +0.6% CAC +1.2% DAX +1%
  • Nikkei 225 futures +0.4%
  • Spot gold +0.5% to $US1554.23 an ounce at 3.10pm New York time
  • Brent crude +4% to $US60.61 a barrel
  • US oil +4.2% to $US56.22 a barrel
  • Iron ore +2.4% to $US91.32 a tonne
  • Dalian iron ore +3.2% to 660 yuan
  • LME aluminium +1.3% to $US1775 a tonne
  • LME copper +2.5% to $US5748 a tonne
  • 2-year yield: US 1.43% Australia 0.76%
  • 5-year yield: US 1.32% Australia 0.71%
  • 10-year yield: US 1.47% Australia 0.93% Germany -0.68%
  • 10-year US/Australia yield gap near 6.15am AEST: 54 basis points

IG MARKETS SPONSORED POST

Market sentiment rebounded marginally last night, driving a pop in risk-assets. There was little substantial information to spark the change. A few market-friendly political breakthroughs. Some positive global Services PMI data. All risk-friendly news, but nothing too great to change the bigger-picture view, yet.

The Hang Seng 50 was one of the major movers yesterday. It spiked yesterday afternoon, on news that besieged Hong Kong CEO, Carrie Lam, would be officially withdrawing the controversial extradition bills that sparked the disruptive and chaotic protests in the city in the past 3 months.

Brexit was the other major political story unfolding overnight. The UK PM Boris Johnson lost another key vote last night, on a bill that ensures Brexit’s delay until the end of January 2020, should no-deal arise between Europe and the UK before the middle of next month.

In response, PM Johnson has stated he’ll push for a UK General Election. His first attempt this morning has failed, but it doesn’t seem that this will be the last of it. The Pound-Sterling is loving the news of a potential last-second save before the Brexit-buzzer blows, all-in-all. It’s trading into the 1.22 handle this morning.

Good Morning and welcome to today’s Markets Live blog. The local market looks set to lift on the open as geopolitical concerns over Hong Kong, Brexit and Italy subside. 

Your editor today is David Scutt.

This blog is not intended as investment advice.

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