Chinese New Year brings tourist dollar down under; Coles and Bunnings silver lining as Wesfarmers profits falls 3.7%: Midday Roundup

Celebrations held today for the first day of the Chinese New Year will also bring cheer to Australia’s tourism industry, which expects to see close to 100,00 Chinese visitors spend up big on accommodation, retail, transport and attractions.

The Tourism and Transport Forum (TTF) said shopping is the number one activity for Chinese travellers who, on average, spend twice as much as tourists from Europe.

“This year data shows a tenfold increase in the average duty free spend at some airports, with a particular focus on high end, luxury items,” said the peak body in a statement.

Tourism Australia figures show Chinese arrivals were up 67% to 95,000 for the month of February, according to Fairfax.

The TTF also used the peak in Chinese arrivals to draw attention to out-dated visa process that sees Chinese tourists pay more for entry to the country.

Coles and Bunnings silver lining as Wesfarmers profits falls 3.7%

Coles and Bunnings were the saving grace of Wesfarmers for the first-half of the financial year, after the retail conglomerate’s net profits slipped by 3.7% to $1.376 billion.

However, the results include Wesfarmers’ discontinued operations, and exuding those, net profit increased by 8.3% for the period.

Coles and Bunnings were able to offset losses by Wesfarmers in the mining and energy sectors, bringing average group revenue up by 0.4% to $31.97 billion.

Earnings at Coles increased 7.1% to $895 million for the period on overall sales growth of 2.8%, while Bunnings’ earnings increased 10% to $618 million on sales growth of 11.9% 

“Despite variability in the domestic economy and volatility in global markets, the group delivered a pleasing increase in underlying earnings in the half which demonstrated the benefits of its conglomerate structure,” said managing director Richard Goyder in a statement to shareholders.

Shares down on open

Despite a relatively strong opening, Aussie shares have taken a small hit coming into lunchtime, as investors continue to digest a mixed bag of corporate results.

Tristan K’Nell, head of trading at Quay Equities, expects a “sluggish afternoon of trade”, despite market turnover into lunch hitting $2.175 billion. 

“Over the past few sessions the market has had surprising out-performance into the afternoon session despite the mixed earning releases,” K’Nell said in a statement.

“However, today the market does look tired and given no significant economic releases in the region, today could be the day we have a sluggish afternoon of trade.”

The S&P/ASX 200 benchmark was down 12.3 points to 5903.4 points at 12.04pm AEDT. On Wednesday, the Dow Jones closed 17.73 points lower, down 0.10% to 18029.8 points.