ASX 200 Henry Jennings, Australian Market Wrap. Headlines, Stocks, Bonds, Economic & Asian Market News – END of DAY REPORT.

 

Happy new financial year

The ASX 200 celebrated the start of the new financial year with a 29 point rise to 6648 following the new détente with China over trade. US futures signalled approval for the new world order with a solid 238 point rise. Kicking off the new year in style saw miners kick higher led by stimulus hopes. BHP up 1.3% and RIO up 1%. Gold miners though missed out on the positive sentiment after bullion fell. NCM dropped 2.2% and NST down 4% led the falls. Banks were slightly better except for CBA which fell 0.6%. NAB the best of the bunch up 0.3%. Oil stocks were pumped with WPL up 0.55% and STO up 1.55%. CSL back in rude health up 0.7%. Tech stocks were better with WTC up 4.7% and CPU up 3.6% together with XRO up 2.1%. In corporate news, GBT rose 4.7% after a new bidder entered the fray. LNK up 5.2% after the completion of the sale of its corporate and private client business. SLC fell 11.7% on a profit downgrade. Asian markets were solid on the trade truce, with Japan up 2.1% and China up 2.5%. Locally bond yields rose slightly with 10-years at 1.33%  and the AUD steady at 70.11c.

Today’s Highlights

  • ASX 200 up 29 to 6648. Average volume.
  • High 6664  Low 6631
  • Banks rally slightly though CBA misses out.
  • Miners in demand on stimulus hopes.
  • Energy stocks rise with crude.
  • Gold miners under pressure as bullion falls.
  • AUD rallies to 70.11c
  • Aussie gold steadies at $2019.
  • Bitcoin crumbles to $10.972
  • US futures up 238.
  • Asian markets firm with Japan up 2.1% and China up 2.5% HK closed.

STOCKS

  • ISX +9.23% BNPL kick.
  • LNK +5.20% completes business sale.
  • MFG +4.31% just keeps going.
  • AVH +4.76% feasibility study completed.
  • GXY +7.35% broker upgrade.
  • VGI -8.13% low volume again.
  • SLR -7.17% WGX -7.73% PRU -6.84% gold under pressure.
  • APT -2.67% VISA comes calling. APT can’t explain the drop Friday.
  • MSB -3.73% profit tatking.
  • SLC -11.69% profit downgrade.
  • SPT -6.35% signs up with KGN +4.42%
  • PET +25.29% Chinese project gets green light.
  • PGC +% sale of non-core business.
  • LNG +10.64% perking up.
  • CGL +9.35% low volume.
  • Speculative stock of the Day: Medibio (MEB) +144.44% after signing Compass Group to ilumen which is having a trial in the UK for early screening of mental health problems. Compass Group employs or engages with 600,000 people and generates revenue of GBP 23.2bn.
  • Biggest Risers: ISX, GXY, BUB, LNK, AVH , WTC and MFG.
  • Biggest Falls: VGI, WGX, SLR, PRU, Z1P, RSG and NST.

TODAY

  • Splitit (SPT) –6.35% To partner up with KGN to offer Australian customers instalment payments.
  • Nine Entertainment (NEC) +3.20% Completes the sale of Australian Community Media and Printing to Antony Catalano and Thorney Investment Group for $115m.
  • Suncorp (SUN) -0.15% Confirmed that proceedings have been filed against its fully own subsidiary, Suncorp Portfolio Services, in the NSW Supreme Court.
  • GBST Holdings (GBT) +4.73% SS&C Technologies submits non-binding indicative takeover proposal for GBST Holdings at 325c per share via scheme of arrangement. The proposal is 25c higher than competitor Bravura’s increased 300c per share non-binding offer made last week and values GBST at $220.7m.
  • Coca-Cola Amatil (CCL)0.10% Completes sale of SPC business to Shepparton Partners Collective for $40m.
  • Superloop (SLC) –11.69 Downgrades FY19 EBITDA guidance to $7-8m vs prior $13-18m. The previous guidance assumed certain transactions would be completed before the end of the financial year. A significant deal that would have contributed to the anticipated EBITDA was not able to be completed in time.
  • Charter Hall Group (CHC) +1.39% Guides FY19 post-tax operating earnings per security (OEPS) growth of 24% vs prior expectations of 14-17% growth. CHC also announces that net revaluations for the six months to 30 June 2019 are expected to be approximately $450 million across the funds management platform ($1.1 billion for FY19) or 1.6% growth in FUM over the $28.4 billion as at 31 December 2018.

ECONOMIC NEWS

  • AiGroup Performance of Manufacturing Index eased 3.3 points to 49.4 points in June (under 50 represents a contraction in factory activity).
  • CBA Australia Manufacturing Purchasing Managers’ Index for June moved up 1 point to 52.0 points.
  • National housing market conditions continued to improve through June, with CoreLogic reporting a 0.2% fall in national dwelling values; the smallest month-on-month decline in the national series since March 2018.

BOND MARKETS

Tomorrow we see the RBA decision.

  • 2-Year bond yields up 1bps to 0.98%
  • 5-Year yields up 2bps to 1.03%
  • 10-Year yields up 2bps to 1.34%

ASIAN NEWS

  • Activity in China’s manufacturing sector fell in June following three months of growth. The Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) for June came in at 49.4, the worst reading since January and below economists’ expectations of 50.0.
  • A gauge of manufacturing across south-east Asia fell back into contraction in June, as employment dropped for the first time in 15 months on weak regional demand.
  • South Korea posted its largest export drop in over three years.
  • Chinese outbound tourists have been hit by trade wars and currency devaluation leading to a 10% fall in spending in the first quarter.

EUROPEAN AND US HEADLINES

  • Facebook’s Libra cryptocurrency is going to create some issues for users as the tax office says every user will need to log every transaction and calculate any capital gains.
  • Not sure US security is quite as relaxed about the new Trump/Huawei love affair as a hardliner has warned Trump of a ‘catastrophic mistake’ on Huawei.
  • Jeremy Hunt has unveiled a GBP20bn war chest to help with a no-deal Brexit.
  • Boris says he will prove Putin wrong by exiting the EU by October 31st.
  • Deutsche Bank is planning to cut 20,000 jobs to be decided on a board meeting on July 7th.
  • England beat India and still in with a chance.

And finally…..my thanks as always to Hans for his funnies…enjoy your European vacation.

I  came out of the chip shop with a meat and potato pie, large chips,  mushy peas & a jumbo sausage. A  poor homeless man sitting there said “I’ve not eaten for two  days.” I  told him “I wish I had your will power..”

An  Irish boy stands crying at the side of the  road. A  man asks him “What’s wrong?” The  boy says “Me ma is dead”.  “Oh  bejaysus” the man says “Do you want me to call Father  O’ Riley for you ?” The boy replies “No tanks mister, sex is the last thing on my mind at the  moment.”

I hate all this terrorist business. I used to love the days when you  could look at an unattended bag on a train or bus and think to  yourself ……. I’m going to have that.

The lawyer says to the wealthy art collector tycoon: “I have some good news and, I have some bad news.

The tycoon replies: “I’ve had an awful day, let’s hear the good news first.

The lawyer says: Your wife invested $5,000 in two pictures today that she figures are worth a minimum of $2 million.

The tycoon replies enthusiastically: Well done, very good news indeed! You’ve just made my day; now what’s the bad news?

The lawyer answers: The pictures are of you in bed with your secretary.

Clarence

XXXX

mt_tryforfree
Financial Markets and Political Commentary
 

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About the author

Henry Jennings Contact: henryjennings@mac.com // @henryj007 Has been involved in Investment Banking and Stockbroking since the early 1980's. Stockbroker - Camerons Stockbroking Macquarie Bank - Equity Capital markets Macquarie Group - Divisional Director