Evening Wrap: ASX 200 sags without US lead, Boss Energy savaged on director sales, drags down uranium stocks

A quiet and listless day for the ASX.

It seems without a lead from our cousins in the USA we really have no idea what to do. 🤷

There were a few stock-specific news related items, however, including the Boss Energy (BOE) directors' sell-down. For all of these, and updates on the usual gyrations in Aussie stocks...

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 21.6 points lower at 7,766.7, smack-bang on its session low. In the broader-based S&P/ASX 300 (XKO), advancers lagged decliners by a dismal 75 to 199. Low close + broad-based move = Not great 👎.

Just two of the 11 major sectors were up today, and none of them by all that much. The Consumer Staples (XSJ) (+0.19%) sector benefited from a rise in The A2 Milk Company (ASX: A2M) (+1.0%) and Treasury Wine Estates (ASX: TWE) (+0.69%) in an otherwise sketchy broader sector.

Real Estate Investment Trusts (XPJ) (+0.04%) were up less, but the broader sector move was more decisive here. General gains were offset by news-related falls in Lendlease Group (ASX: LLC) (-1.9%), and HMC Capital (ASX: HMC) (-1.9%) and dip in sector heavyweight Goodman Group (ASX: GMG) (-0.6%).

Real Estate stocks were generally stronger today

No clear patterns in the losing sectors, falls were generally modest. Let me just say Industrials (XNJ) (-1.0%) was the worst, followed by recent high flyer Utilities (XUJ) (-0.9%).

Elsewhere, Boss Energy (ASX: BOE) (-10.9%) was savaged on news three directors had sold large parcels of stock in the company totaling over 1% of outstanding shares (analysis here). This left a nasty taste in the mouth of investors in several other Aussie uranium stocks.

Boss's loss was contagious in the local uranium sector

ChartWatch

Silver Futures COMEX

Silver's uptrend continues

The last time we covered silver was in ChartWatch in the Evening Wrap on 22 May. It had just tipped the 32.76 point of supply and was pulling back slightly with an upward pointing candle shadow.

Since, another upward shadow and a couple of modest black-bodied candles halted the short term uptrend – but looking at the current long white candle – it appears only on a temporary basis.

The 30.19 point of demand appears to have held, and it is typical to see vibrations of this nature between well defined points of demand and supply.

Short and long term trend ribbons continue to show strong and well-established respective uptrends.

The price action remains rising peaks and rising troughs, and there’s excellent separation between the last trough and the second-from-last peak (signals strong demand on the pullback).

Today’s candle is a dominant display by the demand-side who remains in total control.

32.76 is now the obvious barrier to overcome to facilitate the probing of higher points of supply. The price needs to close above it to confirm.

28.29 - 30.19 looks like a solid zone of demand, bolstered also by dynamic demand from the short term uptrend ribbon. As long as the silver price continues to close above 29.29 the short term uptrend is intact.

Points of supply above 32.76 are few and very far between – as in the 40.88 major peak set on 1 October 2012.

SGX Iron Ore China 62 percent Futures SGX

Looking stronger at a critical juncture

The last time we covered iron ore was in the ChartWatch in the Evening Wrap on 22 May.

Iron ore has failed to capitalise on a nice push off the short term uptrend ribbon, but continues to be supported dynamically by the long term trend ribbon.

The proximity of the short and long term trend ribbons, as well as a crush of price action between 113.15 – 120.15 suggests we are at a critical juncture.

A move to forge ahead with the rally off 113.15 needs to occur quickly to foster confidence in the new long term uptrend and to remove what is clearly pesky and persistent overhead supply.

This means a close above 122.90 with an empathetic long white candle with a high session close. In this scenario, higher points of supply at 126.80 and 131.60 are on the agenda.

Alternatively, a close below the short term trend ribbon could be perilous, and a close below 113.15 even more so.

Economy

Today

• 11:30 AUS Retail Sales April

  • 0.1% m/m vs +0.3% m/m forecast and -0.4% m/m in March

  • +1.3% p.a. vs April 2023

  • Best: Household goods +0.7%, Other Retailing (cosmetics, sports and recreational goods) +1.6%

  • Worst: Clothing and Footwear -0.7%, Food Retailing -0.5%

  • “Underlying retail spending continues to be weak with a small rise in turnover in April not enough to make up for a fall in March,” -Ben Dorber, ABS head of retail statistics

  • Below expectations = weaker consumption and economy = increases probability of an RBA interest rate cut

Later this week

Wednesday

• 00:00 USA Consumer Confidence May (96.1 forecast vs +97.0 April)

• 11:30 AUS Consumer Price Index (CPI) April (+3.4% p.a. forecast vs +3.5% p.a. March)

Thursday

• 11:30 AUS Building Approvals April (+1.8% m/m forecast vs +1.9% m/m March)

• 22:30 USA Prelim GDP March (+1.3% q/q forecast vs +1.6% q/q December)

Friday

• 00:00 USA Pending Home Sales April (+0.1% m/m forecast vs +3.4% m/m March)

• 11:30 CHN Manufacturing PMI May (50.4 forecast vs 50.4 April)

• 11:30 CHN Non-Manufacturing PMI May (51.5 forecast vs 51.2 April)

• 19:30 EUR Core CPI Flash Estimate May (+2.5% p.a. forecast vs +2.4% p.a. April)

• 22:30 USA Core PCE Price Index April (+0.2% m/m and +2.8% p.a. forecast vs +0.3% m/m and +2.8% p.a. March)

Latest News

Interesting Movers

Trading higher

• +10.5% Iperionx (IPX) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈

• +9.1% Mesoblast (MSB) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈

• +8.3% Spartan Resources (SPR) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈

• +7.3% Strike Energy (STX) - Walyering Reaches Payback & Operational Update

• +6.1% Playside Studios (PLY) - Upgrade to FY24 Guidance, rise is consistent with prevailing short and long term uptrends 🔎📈

• +4.8% Jupiter Mines (JMS) - Manganese Market Update, rise is consistent with prevailing short and long term uptrends 🔎📈

• +4.7% 29METALS (29M) - No news, rise is consistent with prevailing short term uptrend, long term uptrend transitioning from down to up 🔎📈

• +4.5% Winsome Resources (WR1) - Adina Mineral Resource increases 33%

• +4.2% Centuria Capital Group (CNI) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈

Trading lower

• -12.6% Peter Warren Automotive Holdings (PWR) - Trading Update, fall is consistent with prevailing short and long term downtrends 🔎📈

• -10.9% Boss Energy (BOE) - Change of Director's Interest Notices (x3) (large sales), see also Kerry's analysis: HERE, closed below short term uptrend ribbon 🔎📉

• -7.3% Cettire (CTT) - No news, but possibly to do with yesterday's, fall is consistent with prevailing short term downtrend, long term downtrend transitioning from down to down 🔎📈

• -6.3% Novonix (NVX) - No news, fall is consistent with prevailing short and long term downtrends 🔎📈

• -5.4% Silver Lake Resources (SLR) - No news 🤔

• -5.2% Botanix Pharmaceuticals (BOT) - No news 🤔

• -5.0% Healius (HLS) - Continued negative response to yesterday's Update on Strategic Review and Chair Appointment, fall is consistent with prevailing short and long term downtrends 🔎📈

• -5.0% Arafura Rare Earths (ARU) - No news, fall is consistent with prevailing short and long term downtrends 🔎📈

• -4.8% Kelsian Group (KLS) - Refinance and Upsize of Corporate Debt Facilities, fall is consistent with prevailing short and long term downtrends 🔎📈

• -4.5% Ioneer (INR) - No news, general sector weakness on sagging lithium minerals prices

Broker Notes

• Audinate Group (AD8) retained at overweight at Morgan Stanley; Price Target: $22.00

• Bendigo and Adelaide Bank (BEN) retained at hold at Ord Minnett; Price Target: $10.50

• Beach Energy (BPT) retained at outperform at Macquarie; Price Target: $2.00

• Capitol Health (CAJ) retained at buy at Bell Potter; Price Target: $0.29

• Centuria Industrial Reit (CIP) retained at hold at Ord Minnett; Price Target: $3.50 from $3.30

• Domino's Pizza Enterprises (DMP)

  • Retained at neutral at Citi; Price Target: $44.50

  • Downgraded to underperform from outperform at CLSA; Price Target: $46.50 from $46.10

  • Retained at positive at E&P; Price Target: $50.64

  • Retained at overweight at Jarden; Price Target: $48.00

  • Retained at buy at Jefferies; Price Target: $48.00

  • Retained at neutral at Macquarie; Price Target: $41.00

• HMC Capital (HMC) upgraded to outperform from neutral at Macquarie; Price Target: $7.97 from $6.76

• Iperionx (IPX) retained at buy at Bell Potter; Price Target: $3.85 from $3.70

• Keypath Education International Inc. (KED) downgraded to neutral from outperform at Macquarie; Price Target: $0.87 from $0.67

• Lendlease Group (LLC)

  • Retained at neutral at Citi; Price Target: $6.90

  • Retained at equal-weight at Morgan Stanley; Price Target: $7.35 from $7.25

• Lynas Rare Earths (LYC) retained at underweight at Morgan Stanley; Price Target: $5.35 from $5.20

• Neuren Pharmaceuticals (NEU) retained at buy at Bell Potter; Price Target: $28.00 from $26.50

• Northern Star Resources (NST) retained at neutral at Citi; Price Target: $15.20 from $14.50

• Pengana Capital Group (PCG) retained at buy at Bell Potter; Price Target: $0.45 from $0.31

• Paladin Energy (PDN) downgraded to hold from buy at Bell Potter; Price Target: $15.70 from $16.50

• Peter Warren Automotive Holdings (PWR) retained at buy at Jarden; Price Target: $2.75

• QBE Insurance Group (QBE) retained at neutral at Citi; Price Target: $20.00 from $19.50

• Qube Holdings (QUB)

  • Retained at buy at Jarden; Price Target: $3.70

  • Retained at buy at UBS; Price Target: $4.15

• St Barbara (SBM) retained at neutral at Macquarie; Price Target: $0.25 from $0.29

• Steadfast Group (SDF) retained at outperform at Macquarie; Price Target: $6.70 from $6.40

• Sandfire Resources (SFR) downgraded to marketweight from overweight at Wilsons; Price Target: $9.90

• Serko (SKO) retained at buy at Citi; Price Target: $4.00

• Southern Cross Gold (SXG) retained at buy at Shaw and Partners; Price Target: $3.26 from $2.90

• The Lottery Corporation (TLC) retained at buy at UBS; Price Target: $5.75

• Telstra Group (TLS)

  • Retained at buy at Jarden; Price Target: $4.00

  • Retained at neutral at Macquarie; Price Target: $3.70

  • Retained at buy at UBS; Price Target: $4.40

• TPG Telecom (TPG)

  • Retained at overweight at Jarden; Price Target: $5.30

  • Retained at neutral at Macquarie; Price Target: $5.10

Scans