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

 

ASX 200 dropped 170 points in another volatile day of trade. The index closed at 4783 as we swung from gains to losses. US futures down 800 points. An early rally on the ECB move was snuffed out and ultimately the RBA move to cut rates and inject $90bn of capital into credit markets, just failed. The AUD below 56c brings back ‘Keatingesque ‘comments. The index was hit from all sides today with company after company throwing away any guidance and holding their hands in the air. The early move from QAN down 15.4% as it closed all international flights, hit travel and leisure stocks hard. CTD down 28.1% WEB in a trading halt after heading for the dressing sheds for a rescue raising. HLO cratered 33.4% and other consumer stocks also in woe. APT fell 22.4% after the chairman sent a letter to shareholders. The All Tech Index fell another 4.4%. The swing vote as usual was the banks which responded badly to the RBA rate cut to 0.25%. Margins will be squeezed, and bad debts will rise as unemployment rises. CBA announced business loan cuts and morgage relief. The jobless numbers today were better than expected at 5.1% but this is backward looking and the future holds uncertainty. CBA fell 4.7% and WBC down 8.6% as the Big Bank Basket fell to $105.05. Some support in the miners on the iron ore price with FMG up 5.8% though BHP down 0.7% on its oil exposure. Energy stocks well and truly under the pump as STO fell 12.1% and WPL down 7.7%. OSH was a huge casualty down 16.8% as Peter Botten has had a farewell to forget. In corporate news, company after company has thrown in the towel on forecasts. BLD down 11%, ADH off 27.57%, DMP -7.5% on store closures, LOV trashed 43.8%, even GPT dropped 21% after a warning shot across the bows. In economic news, the RBA dropped rates to next to nothing and once again pumped liquidity into credit markets and Lagarde announced a EUR750bn package aimed at shoring up the financial system. The 10-year yield rose to 1.37% as the yield curve steepened. AUD down to 55.44c and Asian markets fared slightly better with Japan down 2.7% and China down 1.15%.

  • ASX 200 down 170 to 4783. Big volume again.
  • High 5102 Low 4741. Dow futures down 800 points.
  • RBA cuts rates to 0.25%. 10-year yields rise to 1.45%.
  • Leaders speaking everywhere.
  • US futures down 800.
  • ECB prints EUR750bn to shore up markets.
  • 10-year bond yields rise to 1.37%. Curve steepens.
  • AUD falls hard to 55.44c
  • Aussie gold rallies to $2641
  • Bitcoin better at US$5403
  • Asian markets fall with China down 2.7% and Japan down 1.15%

STOCKS                                               

  • FLT -33.04% in trading halt.
  • MNF +20.27% reaffirms guidance.
  • KGN +3.08% ceasing to be a substantial shareholder.
  • WEB  rescue raising.
  • HLO -33.45% travel stocks crater.
  • CTD -28.13% travel stocks.
  • KMD -27.72% update.
  • SWM -29.09% will struggle.
  • NEC -15.12% business update.
  • LOV -43.81% customers dry up.
  • CIM -31.29% Spanish flu.
  • MYR -44.12% never any customers.
  • IEL -24.46% travel ban bites.
  • TYR -31.45% credit market issues.
  • FNP +11.11% UHT milk hoarding.
  • SUL -35.14% retail environment.
  • APT -22.41% sell now don’t pay later. Funding and debt questions remain.
  • CCP -17.87% funding and bad debts too.
  • NWL +16.12% market update.
  • Speculative stock of the day: Openlearning (OLL) +22.50% agreement with Alibaba unlocks a significant opportunity in China. First course in Australia to utilise Alibaba cloud technology. Newsletter write up this morning.
  • Biggest Rises: NWL, SIG, FNP, WHC, BXB, RFF and URW.
  • Biggest Falls: SUL, FLT, GMA, TYR, CIM, CTD and SGP

TODAY

  • Accent Group (AX1) -24.31% withdraws guidance; no longer expects to achieve profit growth in FY20.
  • Boral (BLD) -10.97% withdraws FY20 earnings guidance; advises that ACCC unlikely to approve call option transaction with Knauf. Mulls asset sales to support its financial position. Expects market conditions will worsen as a result of temporary lockdowns and restrictions imposed to contain the spread of the virus.
  • Webjet (WEB) – requests trading halt pending an announcement in relation to a raising.
  • Domino’s Pizza Enterprises (DMP) -7.50% to close stores in France for a period of 15 days. Stores in all other nine markets will trade as normal. It is not certain if the temporary closure will have a material effect on FY20.
  • Lovisa Holdings (LOV) -43.81% experiencing a significant deterioration in sales due to coronavirus impacts. Not in a position to reliably estimate the financial impact of these events in the coming months.
  • Downer EDI (DOW) -5.78% withdraws FY20 earnings guidance given outbreak uncertainty. Points to a strong balance sheet, significant available liquidity and comfortable headroom in its bank covenants. A the end of December has cash of $515m and committed undrawn facilities of $1.14bn.
  • Qantas (QAN) –15.42% to suspend all scheduled international flights from the end March until at least end May 2020, following latest government travel advice. To undergo a 60% reduction in domestic flights, two-thirds of the workforce will be stood down as a result. To also defer dividend payment until September.
  • The GPT Group (GPT) -20.99% withdraws FY20 funds from operations (FFO) and distribution guidance. The group notes it has $1.3bn of available liquidity held in cash and undrawn bank facilities. Gearing remains low at approximately 22%, with less than $100m of debt maturing through to December 2021.
  • Bluescope Steel (BSL) -4.15% withdraws its 2H20 outlook. Operations have been hit by the national lockdown in Malaysia and the overnight announcement that some automakers in North America would stop work.
  • Afterpay (APT) –22.41% reports it has not seen a material impact on business activity, timing of instalment repayments or transaction losses to date as a result of COVID-19.
  • MNF Group (MNF) +20.27% reaffirms FY2020 EBITDA guidance of $36.0-39.0m, notes rapidly evolving environment. Currently experiencing strong demand for core products across all operating segments.

ECONOMIC NEWS

  • Australia labour force report for February: Unemployment rate 5.1% vs consensus 5.3%. Employment +26,700 vs consensus +6,300. Participation rate 66.0% vs consensus 66.1%.
  • THE RBA HAS CUT RATES TO 0.25%. The full statement is here.

BOND MARKET

ASIAN NEWS

  • Indonesian stock trading halted.
  • South Korea hits circuit breakers after 8% fall. Lowest level since 2009.
  • China virus centre has seen no new cases of CV19.

  • Vietnam’s military is expanding its quarantine facilities to house about 60,000 people.

EUROPEAN AND US NEWS

  • ECB launches EUR 750bn bond buying program.
  • EU is warning of broadband issues if everyone is working from home.
  • GM and Ford in talks to make ventilators. Make rubbish cars so worth a try. Ford V Holden in the Ventilator 1000.
  • USD soaring as flight to quality continues.
  • ETF price dislocation happening as liquidity dries up in some credit products.
  • NYSE has suspended floor trading. Most volume done electronically anyway.
  • Drug trials on coronavirus patients in China yielded mixed results, with an HIV pill showing little benefit and a flu medication made by Fujifilm resulting in faster clearance of the virus.
  • The running total of support from governments is now above US1.9 trillion.
  • Twitter said it’s expanding rules to capture misinformation around the virus, following a similar escalation of measures from Facebook.
  • London is shutting down with 40 underground stations closing.

And finally….

Just failed a captcha test.

Hell of a way to discover you’re a robot

I googled financial jokes…but it just came up and said whole system..

Was just in Coles and seen a bloke whose cart was FULL to the brim with hand sanitizers, baby wipes, soaps, everything that people need!!
I called him selfish and gave him a low down about the elderly, mums, and people who need these types of things. Told him he should be ashamed of himself! He said: “Are you done? Cause I really need to get back to restocking the shelves now!!

Clarence

XXX

mt_tryforfree

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