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The small caps that look good, Myer defies the odds and Packer fights for his rights

Published: 12:56 12 Aug 2021 AEST

QBE INSURANCE GROUP LIMITED - The small caps that look good, Myer defies the odd and Packer fights for his rights

The ASX opened strongly as predicted, but soon fell flat as news of COVID numbers out of NSW and the ACT’s lockdown, saw Australians across the East Coast let out another frustrated sigh.

The S&P/ASX200 is up just 0.10 points today to 7,584.40. 

The top-performing stocks in this index are Graincorp Ltd and QBE Insurance Group Ltd, up 14.63% and 8.73% respectively.

Meanwhile, shareholders were applauding the efforts of Telstra Corporate Ltd, QBE, Downer EDI Limited (ASX:DOW) and AMP Ltd after they released their earnings results.

Commonwealth Bank came back down to earth alongside falls for Rio Tinto Limited and CSL Limited (ASX:CSL).

Sectors this morning were mixed.

So far, we have seen gains in Communications, Discretionary, Staples, Industrials and Energy, but falls in Utilities, Real Estate, IT, Health and Materials.

The gains have so far outweighed the falls, so there is hope for the day yet.

Myer expects to return profit

Major shareholder and Australian billionaire Solomon Lew has been on Myer Holding Ltd’s case for weeks now, urging the retailer to release a trading update.

The embattled company did so today, announcing that it expects to see a profit in the second half of 2021 – the first time it has reached that milestone since 2017.  

Preliminary unaudited 2021 results showed total sales up 5.5% to $2.658 billion with second-half total sales up 38.3% compared to the second half of 2020.

The results may unsettle Mr Lew’s attempt to unsettle Myer’s board, sweep out all non-executive directors and replace them with his own nominees.

Myer was trading higher this morning up 8.5%.

Packer rails against Crown enquiry

Meanwhile, another billionaire is causing headaches of his own.

James Packer has railed against a push to limit his and any other Crown Resorts Ltd investor’s holding. 

Crown Resorts is currently attempting to save its casino licence in Victoria and reinstate it in NSW after the gaming giant was found unfit to hold one.

However, Mr Packer has said that a shareholder cap is unnecessary to address the organisation’s dysfunction.

Mr Packer is looking to protect his 37% shareholding.

Despite the battle, Crown Resorts is trading higher this morning, up 4.7 per cent.

On the small cap front

There have been some big gainers today with European Lithium Ltd (ASX:EUR) up as much as 27.3%, Alexium International Group Ltd (ASX:AJX) up 34.7% and Great Western Exploration Limited up 27.7%.

Other small caps in the green include FYI Resources Ltd up 6.4%, Andromeda Metals Ltd (ASX:ADN) up just over 8%, Latin Resources Ltd up 5% and Musgrave Minerals Ltd up 3.7%.

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