Australian shares remained stagnant before the Reserve Bank of Australia’s interest rate decision at 2:30 pm AEST.
At noon, the S&P/ASX 200 is 0.03 per cent higher at 7,225.50, with seven of 11 sectors showing gains, including energy, communications, property, staples, discretionary, health care, and tech. However, materials, utilities, financials, and industrials saw falls. Coal and gold miners such as Whitehaven (ASX:WHC) and Evolution (ASX:EVN) saw gains, while BHP (ASX:BHP) suffered a 1.6% drop. Suncorp (ASX:SUN) also fell 1.6% due to the ACCC’s cautionary stance on ANZ’s (ASX:ANZ) takeover.
The SPI futures are pointing to a rise of 4 points.
Best and worst performers
The best-performing sector is Energy, up 1.24 per cent. The worst-performing sector is Materials, down 0.51 per cent.
The best-performing large cap is Whitehaven Coal (ASX:WHC), trading 4.86 per cent higher at $7.23. It is followed by shares in New Hope Corporation (ASX:NHC) and carsales.com (ASX:CAR).
The worst-performing large cap is Mercury NZ (ASX:MCY), trading 4.19 per cent lower at $5.72. It is followed by shares in SEEK (ASX:SEK) and Meridian Energy (ASX:MEZ).
In Japan, the Nikkei 225 rose 0.15 per cent, and the Topix climbed fractionally. South Korea’s Kospi was 0.57 per cent up, while the Kosdaq index was 0.36 per cent higher.
In Hong Kong, Hang Seng index futures were at 20,462, higher than the index’s last close of 20,409.18.
Tesla deliveries largely in line, takeaways focus on production and margins.
Tesla reported Q1 deliveries of 422.9K, up 4 per cent from the prior Q and up 36 per cent y/y. The print was just ahead of the 421.5K consensus though some takeaways noted it lagged buyside expectations. Tesla produced 440.8K vehicles in Q1, representing a 45 per cent y/y increase. Takeaways highlighted the production-deliveries spread, which was ~17K in Q1 and 64K cumulatively over the past four quarters. Some discussion about how the production ramp fits with the company’s strategy of building more inventory after exiting 2022 still supply constrained. However, also some discussion about how the inventory build plays into expectations for additional price cuts to stimulate demand, particularly amid an increasingly difficult macro backdrop.
Recent price cuts already flagged as a threat to the 20 per cent auto GM target. However, the more bullish narrative revolves around additional cuts driving a further pickup in demand with margins cushioned by multiple cost reduction levers, including new factories in Austin and Berlin, easing raw material and input prices and IRA credits. Note Tesla jumped 68.4 per cent in Q1, the third best performer in the S&P 500 behind Nvidia (+90.1 per cent) and Meta (+76.1 per cent).
Li-S Energy (ASX:LIS) has achieved a 45 per cent increase in volumetric energy density with their new 20- layer semi-solid state lithium sulphur battery. The new battery is built using a low-flammability electrolyte, which the Company believes makes them safer than traditional sulphur batteries. In response, CEO, Dr. Lee Finniear commented, “This outcome demonstrates the strength of our progress over the last year. In the coming months we look forward to commencing the production of commercial samples for our partner.” Shares are trading 38.2 per cent higher at 35.3 cents.
Besra Gold (ASX:BEZ) has announced that the ‘Initial Payment’ of US$2m from Quantum Metal Recovery has been received. In the next step, Besra is entitled to a further US$3m ‘Initial Payment’ upon execution of the ‘Facility Agreement’ expected in late April of 2023. Shares are trading 28 per cent higher at 16 cents.
Matsa Resources (ASX:MAT) has announced positive lepidolite processing test results from the samples tested in Western Thailand. The results show excellent lithium recoveries at above 95 per cent. In response, Executive Chairman Mr Paul Poli commented: “It is really pleasing to have samples successfully processed using conventional techniques to extract lithium and are capable of producing battery grade lithium carbonate.” Shares are trading 2.5 per cent higher at 4.1 cents.
Commodities and the dollar
Gold is trading at US$1782.70 an ounce.
Iron ore is 3.8 per cent lower at US$122.40 a tonne.
Iron ore futures are pointing to a 3.3 per cent fall.
One Australian dollar is buying 67.88 US cents.