ASX 200 rose 34 to close at 4817 after another volatile day. Australian Market Wrap. Headlines, Stocks, Bonds, Economic & Asian Market News. END of DAY REPORT with Henry Jennings.

 

ASX 200 rose 34 to close at 4817 after another volatile day. A positive opening followed by a slow grind higher as oversold bargains saw huge moves higher in places. Computers were active again. A mid-afternoon malaise set in as the government pushed back the Budget for six months and lined up the second bazooka of stimulus together with banks cutting borrowers some slack both on housing and on business loans. Dow futures turned positive to the tune of 150 points. For the week our ASX 200 fell 13%. The All Tech Index rose 2.8% today. Some extraordinary moves from the likes of LOV up 64.1%, APT bounced a massive 25.7% but was up over 60% at one stage, PDL rose 28% and OSH up 15.3% and STO up 10.9% as oil rose. The banking sector saw big gains too with the small three doing well, ANZ up 6.8% and WBC up 8.5% with the Big Bank Basket flat to $107.36 due to CBA falling 1.7%. REITs were firm as yields fell, GMG up 19.9% and past takeover target NSR, rose 17.5%. Miners were back in demand for a while, but not at the close, WPL up 0.6% and BHP fell 1.2%. FMG missed out on the love for a change, down 5.5%.

The defensives saw sellers as WOW down 6.1% and WES down 4.6% saw profit taking and healthcare stocks under pressure. CSL down 4.6% and SHL fessed up on its earnings outlook and fell 12.5%. Bond proxies saw some book squaring with TCL and SYD both higher by 4.6% and 3.4% respectively. In corporate news, PMV ran 15% after its results, NSR rallied 17.5% after a director bought shares, CIM rallied hard up 51.1% as the Spanish bought some on the fly and moved to 74%. Plenty going on in economic news as money is being thrown around like a drunken Kevin Rudd at a NY club. The PM has pushed the Budget back to October and the RBA is attacking the bond market for the first time ever. The 10-year yield collapsed to 1.15% and the AUD strengthen to 58.45c. Meanwhile in Asia, Japan is closed for a breather and China is up 0.6%

  • ASX 200 up 34 to 4817. Big volume again.Big afternoon fade.
  • High 5016 Low 4795. Narrow 200-point range. Feels like it anyway.
  • Fatigue and sogginess after PM spoke.
  • ASX 200 down 13% for the week.
  • Quadruple witching in US tonight.
  • Dow futures up 100
  • 10-year bond yields fall to 1.15% as RBA intervenes.
  • Healthcare feeling sick. Defensives drop as techs bounce.
  • AUD bounces hard to 58.46c
  • Aussie gold falls to $2535
  • Bitcoin better at US$6162
  • Asian markets fall with China down 2.7% and Japan down 1.15%

STOCKS                                               

  • AIZ -36.31% cuts dividend amidst NZ government rescue package.
  • FNP -12.36% hoarding stops. UHT milk keeps coming.
  • SHL -12.55% succumbs to CV19 gravity.
  • RMD -10.39% profit taking.
  • CIM +51.15% Spanish say Si to mas.
  • CAR +0.85% earnings guidance withdrawn.
  • APT +25.66% write up in Livewire.Was up 60% at one stage.
  • CTD +19.36% says no need to worry about capital.
  • SM1 +20.81% confirms CFO departure date. Creaming it.
  • PMV +15.04% investor presentation.
  • LOV +64.08% amazing bounce. Trinkets back.
  • TYR +39.18% fintech bounce.
  • JHC +7.69% CEO steps down for personal reasons.
  • MVF -15.70% withdraws guidance.
  • URW +12.61% has sufficient liquidity.
  • RSG +8.33% locks in finance.
  • Speculative stock of the day: Too many to mention. Looked like a lender withdrew short selling stock. SYR up 53.33%
  • Biggest Rises: CIM, PDL, APT, SM1, IAP, CTD, GMG and NSR.
  • Biggest Falls: AIZ, SHL, FNP, RMD, AZJ, SOL and RHC.

TODAY

  • Michael Hill International (MHJ) +16.67% announces two-week closure of its Canadian stores, majority of its workforce to be stood down as a result.
  • Webjet (WEB) – unable to lock in equity raising at any price. The additional government restrictions on travel strongly deterred investor interest.
  • Credit Corp (CCP) -2.77% withdraws 2020 earnings and investment guidance. Notes it hasn’t seen a material impact arising from the virus. Points to a strong balance sheet and funding position, with $170m of cash and undrawn credit lines.
  • Domain Holdings (DHG) -1.31% While trading conditions in March show improving listings volumes, and yield growth, there is uncertainty about the potential impact of the outbreak on the Australian property market. That said, DHG points to a balance sheet with a leverage ratio of 1.6x as at December 2019, with ample headroom against debt covenants.
  • Scentre Group (SCG) +7.67% withdraws FY20 guidance. Operations in line with expectations during the early part of 2020.
  • Orora (ORA) – sale of its Australasian Fibre Business to Nippon Paper Industries receives FIRB approval.
  • Mayne Pharma (MYX) +23.08% CFO Nick Freeman resigns, to join NHF as its CFO.
  • FlexiGroup (FXL) +1.68% withdraws transaction volume growth objective of 10-15% for FY20.
  • Qantas (QAN) +10.28% CEO Alan Joyce cautions government against nationalising Virgin Australia. says it would create an unfair advantage in the sector and reward Virgin for previous mismanagement.
  • NRW Holdings (NWH) +21.92% Says it has not experienced any material impact to operations, equipment utilisation remains consistent with expectations. Expects cash balances at the end of March to be in excess of $100m and has access to undrawn working capital facilities of $61m.
  • Macquarie Group (MQG) +7.26% to acquire the remaining 40% of Spanish electricity distributor, Viesgo it does not already own for €3bn.
  • BHP Group (BHP) –1.21% Says it hasnt seen a material impact on operations or supply chain due to COVID-19. Management had this to say, “While uncertainty remains high, our operations are running well and our financial position is strong with net debt of US$12.8bn at the lower end of our target range, and cash and cash equivalents of US$14.3bn.”
  • Telstra (TLS) -6.12% puts job reductions on hold, brings forward 5G investment. To recruit an additional 1,000 temporary contractors in Australia to help manage call centre volumes. Bringing forward $500m of capex from H2 of FY21 into the calendar year 2020. Current outlook unchanged.
  • Corporate Travel Management (CTD) +19.36% Says no current need to raise equity due to solid liquidity position, targeting cost reductions, interim dividend deferred until October.
  • Brickworks (BKW) -3.21% notes five plants to close down due to shutdown orders in Pennsylvania. Governor Tom Wolf ordered all non-life-sustaining businesses in Pennsylvania to close their physical locations to slow the spread of the coronavirus.

ECONOMIC NEWS

  • NAB’s head of currency strategy Ray Attrill said the local currency could fall as low as US50¢ during the second quarter of the calendar year.
  • Scott Morrison has postponed the budget until October. 2020 at least.
  • Credit ratings stable for “majority” of banks after $90bn RBA funding says S&P
  • The RBA said it would be buying up to $5bn in the bond markets today. It was its first ever open market operation aimed at lowering yields in the market.
  • Anna Bligh from the ABA (remember her?) has said that banks will defer loan repayments for six months for small businesses, an additional emergency measure to assist borrowers through the coronavirus crisis. The association reckons this could put around $8bn back into small businesses wallets. So out of whose? The Banks profits?

BOND MARKET

ASIAN NEWS

  • Macau halves gaming revenue forecasts.
  • China keeps rates on hold unexpectedly. The one-year loan prime rate was kept at 4.05%

EUROPEAN AND US NEWS

  • Trump says China could have stopped virus rolling into US.
  • G7 meeting cancelled at Camp David. Now online.
  • California goes into lockdown. 40m people behind closed doors. Fifth largest economy. living on Dominos and Goop.
  • Bless. One US drug maker has doubled the price of a potential CV19 treatment.
  • Trump open to taking stakes in bail outs. Especially golf resorts.
  • Musk tried to keep Tesla factory open. Fails.
  • US banks are looking at lower credit limits as workers get laid off.

And finally…stay safe wash your hands..

An old man in Mississippi was sitting on his front porch watching the sun rise. He sees the neighbor’s kid walk by carrying something big under his arm.

He yells out “Hey boy, whatcha got there?”

Boy yells back “Roll of chicken wire.”  Old man says “What you gonna do with that?”

Boy says “Gonna catch some chickens.”

Old man yells “You damn fool, you can’t catch chickens with chicken wire!”

Boy just laughs and keeps walking.

That evening at sunset the boy comes walking by and to the old man’s surprise he is dragging behind him the chicken wire with about 30 chickens caught in it.

Same time next morning the old man is out watching the sun rise and he sees the boy walk by carrying something kind of round in his hand.

Old man yells out “Hey boy, whatcha got there?”

Boy yells back “Roll of duck tape.”  Old man says “What you gonna do with that?”  Boy says back “Gonna catch me some ducks.”

Old man yells back, “You damn fool, you can’t catch ducks with duck tape!”  Boy just laughs and keeps walking.

That night around sunset the boy walks by coming home and to the old man’s amazement he is trailing behind him the unrolled roll of duck tape with about 35 ducks caught in it.

Same time next morning the old man sees the boy walking by carrying what looks like a long reed with something fuzzy on the end.  Old man says “Hey boy, whatcha got there?”  Boy says “It’s a pussy willow.”

Old man says “Wait up … I’ll get my hat.”

Clarence

XXXX

mt_tryforfree

Financial Markets and Political Commentary

 

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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