ASX opens higher, NAB surges; Stokes ups BlueScope bid; Santos cuts jobs

The Australian sharemarket has advanced at the open as investors digested a raft of company results, with National Australia Bank jumping after a trading update.

The S&P/ASX 200 was up 45.5 points, or 0.5 per cent, to 9004.4 in early trade, with 10 of 11 industry sectors in positive territory. Materials is the sole laggard.

National Australia Bank notched up $2 billion in profits during the December quarter, as the big four bank expanded in mortgages and business loans while also benefiting from fewer borrowers struggling with repayments.

NAB, the final big four bank to update investors on its performance this month, said on Wednesday that unaudited cash profit rose 16 per cent in the three months to December, compared with the same period a year earlier, to $2 billion. NAB shares soared 5.7 per cent in early trade while Westpac jumped 1.8 per cent and ANZ Group added 0.7 per cent, but Commonwealth Bank slid 0.5 per cent.

Suncorp’s profits plunged and the insurer cuts its dividend, after its bottom line was hit hard by disaster costs during the December half.

The insurance group behind AAMI, GIO and other major brands reported $263 million in net profits, a decline of more than 70 per cent from the same half last year, after disaster costs exceeded its allowance and it made weaker investment returns. It reduced the interim dividend to 17¢ a share, down from 41¢ last year.

Chief executive Steve Johnston said the company had received 71,000 insurance claims in the half in significant natural hazard incidents, resulting in net costs of about $1.3 billion. Suncorp shares were 1.6 per cent higher in early trade.

Billionaire Kerry Stokes’ business conglomerate and its US bidding partner have raised their bid for BlueScope steel, pitching a “best and final” offer of $32.35 a share, up from $28.35 previously. The bidders, SGH and Steel Dynamics, said the all-cash offer values BlueScope at $15 billion.

After rejecting an earlier bid, BlueScope said in an ASX announcement on Wednesday it would consider the latest offer. BlueScope shares were 1.6 per cent higher in early trade while SGH added 0.9 per cent.

Mining giants BHP fell 1.7 per cent, Rio Tinto dipped 0.2 per cent and Fortescue lost 0.2 per cent. Gold miners retreated with Northern Star falling 2.2 per cent and Evolution Mining 3.5 per cent. Silver major South32 slid 0.9 per cent.

Energy giant Santos lost 1.1 per cent as it reported a 35 per cent drop in full-year profit and also announced job cuts. The oil and gas company is targeting a 10 per cent reduction in headcount after its profit slumped on lower oil and gas prices.

Woodside Energy and Yancoal were 0.5 per cent lower in early trade.

Tech stocks advanced, led by Technology One’s 9.5 per cent jump after it upgraded its profit guidance. WiseTech added 0.3 per cent and Xero advanced 1.3 per cent.

Australia’s real estate investment trusts are reporting growing confidence in the property sector. Shopping centre giant Vicinity Centres will pay investors an interim distribution of 6.2c per share, up from the same period last year, and paying out 88.4 per cent of its adjusted funds from operations.

It said specialty and mini major sales are up 5.1 per cent in the first half as demand for retail floorspace increases and supply tightens. Vicinity shares fell 0.6 per cent.

Office and industrial heavyweight Dexus jumped 5.6 per cent after it said it almost doubled its total office floor leasing volumes.

“Valuations have turned positive, transaction and fundraising markets are recovering, and our confidence in the long-term fundamentals of the business has strengthened,” chief executive Ross Du Vernet said.

Apartment developer Mirvac Group rose 3.6 per cent as it reported operating profit of $248 million, or 6.3c per security for the half year ended December 31, or growth of 5 per cent on the prior year.

The Australian dollar was trading at US70.84¢ at 10.41am AEDT.

Overnight, a quiet finish for the US stock market masked big swings underneath the surface as companies talked about how discouraged their customers are feeling and some tech stocks continued to feel the downside of the artificial-intelligence boom.

The S&P 500 rose 0.1 per cent after flipping earlier between a gain of 0.5 per cent and a loss of nearly 1 per cent. The Dow Jones added 32 points, or 0.1 per cent, and the Nasdaq composite gained 0.1 per cent.

On Wall Street, Paramount Skydance helped lead the market and rose 4.9 per cent after Warner Bros. Discovery said it would allow Paramount a chance to give its “best and final” bid to buy the entertainment company. Paramount is trying to top an offer from Netflix.

Warner Bros. Discovery rose 2.7 per cent, and Netflix added 0.2 per cent.

Drops for some Big Tech stocks were the heaviest weights on the market Tuesday, including a 1.2 per cent fall for Alphabet.

The moves were tentative, though, and Nvidia swung between being one of the market’s heaviest weights and one of its biggest strengths.

Markets need such Big Tech companies to stabilise and “need to see less sell first/ask questions later behavior from investors,” according to Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute.

With AP

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