The ASX was off to a flyer in the first 90 minutes of trading, but by midday had erased all gains.
The ASX was 1.2% higher, but the S&P/ASX200 has fallen sharply, dropping 123.80 points or 1.78% to 6,837.80 and setting a new 100-day low.
This index has lost 6.87% for the last five days, but is virtually unchanged over the last 52 weeks.
The bottom-performing stocks so far are Codan (ASX:CDA) Ltd down 10.22% and Evolution Mining Ltd (ASX:EVN) down 9.49%.
CSL was also hit hard falling from +1.5% to -3%.
WES fell 4.2%, Macquarie dived 3.2% and Goodman slipped 2.8%.
On a brighter note, BHP rose 2%, RIO rose 2.4%, WPL gained 3.9% and Santos and S32 rose 3.2%.
Kogan fails to meet expectations
Kogan.com Ltd shares are down almost 3% after its first half trading update missed expectations and profits fell 58% on the back of supply chain disruptions and rising business costs.
Canadian banking giant RBC Capital Markets said that while gross sales were in line with expectations, Q2 growth had slowed as gross profit and adjusted EBITDA were out of line to RBC and market consensus.
Adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) was $4.8 million for the months of November and December, lower than RBC’s estimate of $7 million per month.
"We see additional variable warehousing cost increases due to COVID interruption related logistic costs apart from the planned increase in marketing costs related to the Kogan First build impacting this increase," RBC analyst Chami Ratnapala said.
"While the company has not provided any outlook commentary, further to our expectations on the levels of normalisation to post-lockdown growth in November/December, we think demand conditions would present a tougher backdrop heading into H2 FY22."
RBC’s sentiment is negative with a price target of $9.00.
Founder and CEO of Kogan.com, Ruslan Kogan, put a positive spin on things saying, “Over four million Aussie and Kiwi shoppers have recently experienced the choice, value and delivery benefits of the Kogan.com Group.
“Every decision and action we take is for our customers, and the world-class Kogan team jumps out of bed every morning to create a great experience for online shoppers. We have continued to re-invest in our customers through the Kogan First loyalty program to offer the best deals on a wide range of products, delivered quickly and efficiently.
“After launching late last year, Kogan Delivery Services is already making an impact with more than 100,000 orders delivered directly to customers since launch. As always we’re obsessed with the long term, and our ever-improving customer experience continues to underpin business success.”
Tesla’s record profit amid supply chain problems
Tesla Inc (NASDAQ:TSLA) recorded a $US5.5 billion profit in 2021, however, said that supply chain problems would continue to hurt production this year.
The record profit was due in part to an 87% jump in auto deliveries in 2021, in spite of the global semiconductor shortage.
The company reported a 71% rise in revenues to $US53.8 billion, but said supply chain issues will be evident “for several quarters”.
“We plan to grow our manufacturing capacity as quickly as possible,” Tesla said in a news release.
“The rate of growth will depend on our equipment capacity, operational efficiency and the capacity and stability of the supply chain.
“Our own factories have been running below capacity for several quarters as supply chain became the main limiting factor, which is likely to continue through 2022.”
In the most recent quarter, Tesla scored a $US2.3 billion profit, up more than eight times the year-ago level as revenues jumped 65% to $US17.7 billion.
According to eToroanalyst Josh Gilbert, “Leading EV manufacturer Tesla today reported its Q4 earnings of US$2.54 per share on revenues of US$17.72 billion, compared to analyst expectations of US$2.36 per share on revenue of US$16.64 billion.
“Tesla has once again delivered another earnings report above expectations and continues to increase its margins. The company’s automotive gross margin came in at 30.6% compared to estimates of 29.9%, despite the supply chain, transportation and logistical challenges that still plague many of its competitors. Tesla has outpaced the rest of the auto industry and has excelled at adapting to global shortages, delivering over 936,000 cars in 2021.
However, it seems Tesla wasn’t able to completely avoid being stung by the global pandemic. The EV manufacturer was unable to run factories at full capacity in Q4, which could potentially impact its deliveries and profits heading into 2022. This outlook is likely to spook investors, with the extent of the shutdowns unknown and given the current market backdrop.
On the small cap front
Tempus Resources Ltd (ASX:TMR, TSX-V:TMRR) is 6.90% higher. TMR has made strong drilling progress including a second bonanza grade gold intersection at the Blue Vein discovery within its Elizabeth-Blackdome Gold Project in southern British Columbia, Canada.
Aldoro Resources Ltd (ASX:ARN) has gained 6.45%. ARN has completed its Phase 1 drilling program at its Niobe Project targeting lithium and rubidium and is encouraged by the results.
Great Boulder Resources Ltd (ASX:GBR) is 3.70% higher. GBR has begun a 5,000-metre aircore drilling program at its Whiteheads Gold Project north of Kalgoorlie in Western Australia.
Kinetiko Energy Ltd (ASX:KKO) is 2.35% higher. KKO has closed the books on its third aeromagnetic survey at the Amersfoot Project in South Africa, with interpretation more than doubling the asset’s gas prospective compartments.
Chimeric Therapeutics Ltd (ASX:CHM) is climbed 2.27%. CMR has been issued a patent from the Unites States Patent and Trademark Office covering certain applications of chimeric antigen receptor (CAR) technology using chlorotoxin (CLTX), including Chimeric’s clinical-stage CAR T asset CHM 1101 and preclinical-stage CAR NK asset CHM 1301.
Jindalee Resources Ltd (ASX:JRL) is up 2.17%. JRL has signed a binding term sheet with GWR Group for the sale of a 70% interest in the Prospect Ridge Magnesite Project in Tasmania for A$1 million in cash and shares.