The report card is finally in for Australia’s major companies and the profit results are better than expected.
Particularly notable was BHP’s monster profit and those of the four big banks, which all managed to beat market expectations.
The result with just a few stragglers left to report is that the ASX 200 added 23.3 points or 0.3% to 9,168.60 points on Friday, with that record close pumping up the index by an impressive 3.7% for the month of February.
Consumer stocks one weak point
There were a few areas of weakness such as consumer stocks such as JB Hi-Fi and Nick Scali but the overall theme was positive, even if any disappointing companies were harshly dealt with by the traders.
A strong positive result for the ASX 200 in February means it has now risen for three months in a row.
One of the disappointments on Friday was Coles shares (ASX: COL) which fell 7.4% to $20.56 after reporting softer supermarket sales growth than rival Woolworths.
Even Woolworths shares (ASX: WOW) which rallied exceptionally hard on Wednesday to record their biggest one-day gain ever, fell 1% to $36 as investors took some profits before the weekend.
While the Coles result was fairly solid, it could not compare to Woolworths’ stronger update and was particularly soft in the higher-margin liquor area.
Investors are now warily watching both chains as they battle to win over more cost-conscious consumers with Woolworths looking stronger so far.
REA keeps kicking goals
In other market moves, the communication sector was buoyed by property advertising unit REA Group shares (ASX: REA) jumping 3.6% or $5.83 to $166.39.
Materials were also pushed higher with some impressive moves by some of the more junior members.
Rare earths are running
In the US, MP Materials (NYSE: MP) signed an “enormous” rare-earths supply contract with an unidentified automaker which also put a rocket under local rare earth players.
Shares in Lynas Rare Earths (ASX: LYC) rose an impressive 10.1% to $18.98 and Iluka Resources (ASX: ILU) followed along with a 9.1% rise of its own to $6.75
Sackings send Block higher
One of the strongest moves came as a result of widespread sackings, with Block shares (ASX: XYZ) rising 27.8% to $94.15 after the owner of Square and Afterpay announced it would slash 4000 of its 10,000 staff.
Gross profit rose 17% to US$10.36 billion for 2025.
Automotive equipment supplier Bapcor (ASX: BAP) saw its shares crunch 49.3% to 87¢ after it resuming trading following a heavily discounted capital raising at 60¢ a share.
Investors digested some fairly negative broker reports warning of fast falling earnings per share, significant execution risks and some nasty sell calls.
The weaker consumer story continued with shares in retailer Harvey Norman (ASX: HVN) down 9% to $5.76 after first-half results contrasted weaker Australian sales but a stronger international performance.
Investors were also disappointed by a lower than expected interim dividend.
Things could probably have been worse for TPG Telecom (ASX: TPG) shares which fell 2.7% to $3.94 even though the company returned to profit, with a net profit of $52 million for the half.
Subscriber trends were mixed as competition among mobile phone service providers ramped up.
Virgin maintaining margins
Shares in Virgin Australia (ASX: VGN) slid 0.3% to $3.14 after statutory profit fell 27.9% to $341 million after taxes rose and the airline moved to protect margins rather than fight for more growth.
Shares in digital property exchange PEXA (ASX: PXA) climbed 4.7% to $14.98 after it reported core profit of $21 million, which was almost double consensus forecasts.
Australian division pre-tax margins were particularly strong, rising to 58%.
Shares in financial services company Humm (ASX: HUM) rose 5.3% to 70¢ after the company agreed to form a new committee to assess a $385 million takeover bid.
The committee will not include chairman Andrew Abercrombie and follows investor complaints to the Takeovers Panel over potential insider trading.
The week ahead
Investors will continue to mull over some of the themes of the February reporting season as In Australia, even as some remaining companies including Life360 and Endeavour file their results.
That means there will be more of a focus back on to economic data with the biggest for the week being the fourth quarter GDP numbers on Wednesday.
Is growth slowing?
Most projections are that the Australian economy grew 0.7% in the fourth quarter as business investment growth slowed down.
The fourth quarter earnings season is also winding down in the US with some of the remaining results in the coming week being AST SpaceMobile, MongoDB, CrowdStrike Holdings, Broadcom, JD Sports Fashion and Costco.
There are also some interesting US economic reports including measures for manufacturing, services, employment, and farm payrolls.
The continuing negotiations over whether there is a US strike on Iran will also be closely watched.
