Jump to content

ASX 200: three stocks to watch as of February 20th


MongiIG

Recommended Posts

Find out all the latest information on the ASX 200 market and this week's financial stocks to watch, updated as of 20th of February, 11.00 am Sydney time.

 

bg%20nab%20national%20australia%20bank%2Source: Bloomberg

 

 Tony Sycamore | Market Analyst, Australia | Publication date: Monday 20 February 2023 

ASX 200 overview

The ASX 200 fell 64 points (-0.83%) on Friday to close at 7346.8. After falling for a second successive week, the ASX 200 is now 3% below its February 7567 high, weighed on by the RBA's hawkish shift and earnings season landmines.

Last week the heavyweight Financial Sector lost 4.33%, weighed on by an 8% fall in CBA following its earnings report. Elsewhere, the Energy Sector (-1.94%) and influential Materials Sector (-0.63%) also fell during the week.

This week we review the recent news and charts of three ASX-listed financial stocks after an eventful week.

  • Commonwealth Bank of Australia (CBA)

Last week the share price of Commonwealth Bank of Australia fell 8.17% to $100.97, giving back all the gains it recorded during the first five weeks of 2023. The catalyst for the fall was CBA's earnings report which showed that CBA's Net Interest Margins (NIM), a key measure of the bank's profitability, likely peaked in October at 2.16%, were currently at 2.10% and expected to fall to ~2% in FY24.

The fall in CBA's NIM results from intense competition for home loans and deposits, more than offsetting the benefit provided by the RBA's rate hiking cycle. The bank also mentioned concerns about the upcoming fixed rate cliff and cyber security. This was enough of a reason to see investors rush for the door in the current environment of low credit growth, rising delinquencies, and falling home prices.

Last week's fall in the CBA share price warned that a medium-term high is in place at $111.43 and that a deeper pullback is underway. This Wednesday, CBA will trade ex its 210cps interim dividend, which should see the share price break below support at $100.00.

There is interim technical support at $96.00. However, a stronger layer of support is at $92.50, which needs to hold to prevent a deeper pullback to $89.00/$87.00.

Commonwealth Bank of Australia daily chart

 

1-STW-Tony.pngSource: TradingView

  • National Australia Bank (NAB)

Last week the share price of National Australia Bank fell 5.78% to $29.85, giving back all and more of its strong gains in January after being caught in the down draft of CBA's earnings report and following its Q123 trading update.

While there was no obvious evidence of a peak in NAB's NIM (NIM expanded by 7bp from 1.72% in Q422 to 1.79% in Q123), intense competition in the mortgage and deposit space suggests there are downside risks to margins in FY24.

If Friday's break of trendline support at $30.00 is sustained in the early part of this week, it opens up a test of support near $28.50, coming from the October $28.39 low.

National Australia Bank daily chart

 

2-STW-Tony.pngSource: TradingView

  • Westpac (WBC)

Westpac was caught in the down draft of the CBA earnings report, following its own Q123 trading update where the share price fell 4.45% to close at $22.78.

While there was an intense focus on possible peak NIMs of Westpac's peers, there was not enough detail in the trading update to come to any firm conclusions on Westpacs profit performance.

As viewed on the chart below, Westpac is moving towards a layer of support at $22.60/50 coming from the January 2023 low, a cluster of highs in August 2022, the gap higher in early October and finally, uptrend support from the $18.80 low of June 2022.

Providing that the share price holds, a return to the range highs over the past 12 months at $24.50/70 is likely. However, should the share price see a sustained break below the $22.60/50 support, it opens the way for a deeper decline to support at $20.50/00.

Westpac daily chart

 

 

3-STW-Tony.pngSource: TradingView

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • Nettensor is making waves in the tech industry by offering a unique combination of AI infrastructure and advanced blockchain solutions. They leverage cutting-edge hardware to deliver fast, efficient, and powerful products designed to streamline the convergence of these two revolutionary technologies. It boasts a comprehensive suite of services, including NetCloud, NetGPU, NetApp Chain, and NetVPN. Notably, their native token, NAO, recently debuted on the Bitget exchange and has been experiencing a positive initial price trend. With its focus on simplifying and elevating the synergy between AI and blockchain, Nettensor is positioned to be a key player in the future of decentralized applications. But will NAO's bullish start translate into long-term success? Only time will tell.
    • The spike in volume you're noticing around 7 pm could be related to the closing of trading sessions or the release of important news. Regarding your experience with a sudden wick spike, this is a common challenge in trading. Setting appropriate stop-loss levels and being prepared for volatility can help manage such risks. As for news sources, financial news outlets like Bloomberg, Reuters, and CNBC can provide valuable insights into market trends. Also, I came across this interesting platform, smarterbusiness.co.uk, which helps businesses find optimal utility providers. While it may not be directly related to trading, having access to the right info and resources can be crucial in any business endeavor.
    • prepare to witness a revolution in blockchain technology with Massa, pioneering a radical approach through its unique blockclique architecture. Capable of processing up to 10,000 transactions per second, Massa stands as a leader in scalability, efficiency, and security, setting new standards for decentralized ecosystems. At the heart of Massa's innovation lies its blockclique architecture, a groundbreaking framework designed to optimize transaction throughput and enhance network performance. With the capacity to handle up to 10,000 transactions per second, Massa empowers developers and users with unparalleled speed and scalability, paving the way for a new era of blockchain applications. Massa's Autonomous Smart Contracts (ASCs) represent the next evolution in smart contract technology. Supporting a wide range of applications, including DeFi, ASCs enable decentralized applications (dApps) to be fully hosted on-chain, reducing reliance on centralized services and enhancing security and autonomy. With Massa's ASCs, developers can unleash the full potential of decentralized finance and beyond, driving innovation and accessibility in the blockchain space. Excitement mounts as Bitget Exchange announces the listing of Massa, providing users with the opportunity to trade and stake this revolutionary token. This partnership not only enhances Massa's visibility but also offers traders and investors a trusted platform to engage with its native token, unlocking new opportunities for growth and participation in the Massa ecosystem.
×
×
  • Create New...
us