Macquarie’s profit could test record as it gains from energy volatility – By Clancy Yeates

Macquarie, which uses a March financial year, did not disclose its actual profits for the quarter, but it said commodities and global markets business had enjoyed a bumper December quarter, prompting analysts to lift earnings forecasts for the group.

“Varied market conditions have resulted in a good quarter for the group reflecting the diversity of our activities,” chief executive Shemara Wikramanayake said in a statement.

Opal Capital portfolio manager Omkar Joshi said Macquarie was known for being highly conservative with its guidance, but the company was clearly on track for a strong financial year. “Unless the fourth quarter is very weak, it’s likely they will equal last year’s profit, if not exceed it,” Joshi said.

Morningstar analyst Nathan Zaia said he was forecasting full-year earnings would be slightly lower than last year, but he said predictions were tricky because the key source of recent strength was the commodities business – which has benefited from volatility.

Zaia pointed out commodity and energy markets had been affected by factors including the Ukraine war, severe weather and disruptions caused by COVID-19. With the energy transition under way, he said it was possible there would be further bouts of volatility that worked in Macquarie’s favour. “The environment could be favourable for Macquarie for a number of years,” Zaia said.

Investors responded favourably to the update, lifting Macquarie shares 1.5 per cent higher, to $191.82.