In today’s briefing:
- EQD | S&P/ASX200 Pullback In Sight (This Week or the Next)
- Sigma Healthcare (SIG AU): Merger Uncertainty To Limit Upside Potential
EQD | S&P/ASX200 Pullback In Sight (This Week or the Next)
- The S&P/ASX 200 Index has reached a specific resistance level that often precedes a short-term pullback, when this pattern is encountered.
- The pullback may happen next week, but this week is also a potential candidate since the 2nd week up is usually pretty weak when this pattern is encountered.
- Hold your LONG positions and cover them to hedge. Going SHORT is probably best at the end of the week, on Friday, if the week is closing up.
Sigma Healthcare (SIG AU): Merger Uncertainty To Limit Upside Potential
- Sigma Healthcare (SIG AU)‘s proposed merger with Chemist Warehouse Group is being reviewed by Australian Competition and Consumer Commission (ACCC), with decision expected in 2H24.
- Although Sigma is witnessing continuing momentum in its business (YTD sales are up by 6.6% YoY) and reaffirmed EBIT margin guidance, merger uncertainty overshadows the improved financial performance.
- We think near-term positives of the company have already been priced in, thereby limited room for upside potential. Merger uncertainty will remain an overhang on the share prices.
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