The major banks weighed on the market, led lower by Commonwealth Bank. Commonwealth Bank (CBA) fell 1.5% after releasing its first half results this morning. Cash profit fell by 10.8% to $3,886m for the six months to 31 December 2020. Healthy growth in business and home lending was helpful. The number of home loan deferrals improved from 145,000 back in June 2020 to ~25,000 in December. CBA was negatively impacted by a low rate environment and COVID-19. It declared a $1.50 per share dividend; a 53% lift in the September 2020 dividend but was still ~25% below a dividend paid a year ago.
CIMIC (CIM) remained the hardest hit, slumping by 17.1% despite returning to profitability over the year, making $620m and declaring a 60c dividend (first dividend payment since October 2019). Revenue slumped by 20% to $10.6bn partly due to the pandemic, which has led to temporary delays in the award of new projects and a slowdown in business in both Australia and overseas.
IAG surged 4.6% after written premiums jumped 3.8% to $667m, margins improved and its cash profit rose to $462m. Over the half, lower motor vehicle claims provided a boost. With fewer cars on the road, the number of claims declined.
ECONOMIC NEWS REPORTS: Australia Westpac Consumer Confidence Improves In February- Australia consumer confidence improved in February, the latest survey from Westpac Bank and the Melbourne Institute revealed on Wednesday as their sentiment index rose 1.9% to a reading of 109.1. That follows the 4.5% drop in January to 107.0. The management of the pandemic locally has had a constructive effect on confidence. The success of contact tracing and light-handed lockdowns has been important in containing a worrying cluster of cases since the last survey in January.
Australia Building Permits Climb 10.9% On Month In December- Australia total number of building permits climbed a seasonally adjusted 10.9% on month in December - standing at 19,537, the Australian Bureau of Statistics said on Wednesday, following the 2.6% increase in November. Permits for private sector houses climbed 15.8% on month to 13,638, while permits for private sector dwellings excluding houses added 2.3% to 5,625. On a yearly basis, overall dwellings spiked 22.8%, while private sector house dwellings surged 55.6% and dwellings excluding houses tumbled 19.3%.
CURRENCY NEWS: The Australian dollar changed hands at $0.7738 following its rise from levels around $0.765 earlier this week.
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