Monday 16th July – Australian Market Wrap

Putin

Today’s Headlines

  • ASX 200 slides as banks soften closing down 27 to 6241.5.
  • High 6276 Low 6235. Holiday volumes still.
  • Amazon Prime kicks off.
  • Defensives back in favour as resources weaken.
  • Energy sapped. TLS better.
  • CSL comes off the boil.
  • Financials under pressure.
  • AUD firms to 74.28c
  • Bitcoin stronger at US$6360
  • Aussie Gold weaker at $1675.40
  • US futures up 50
  • Asian markets mixed though tensions ease Japan up 1.85% and China down 0.71%.

STOCK STUFF

Movers and Shakers

  • GEM +5.46% takeover talk and Affinity sale.
  • ING +4.53% bouncing back.
  • COE +4.88% Fourth quarter presentation. Sole on track.
  • KGN +2.24% rally continues as Amazon Prime Day kicks off.
  • DMP +1.04% broker upgrade
  • BLA +5.65% Shaw and Partners upgrades. Keeping the faith.
  • SIG +4.21% change of directors interest.
  • AX1 -12.42% restricted shares released from escrow.
  • FNP -3.66% more downgrades.
  • PLS -4.21% profit-taking continues.
  • PPS -8.65% a bridge too far perhaps?
  • ATS +10.20% Corporate presentation.
  • FLN +14.89% thin volume. Tech rally helps.
  • KMD +4.29% cold weather bites.
  • WBC -0.44% quits lending to SMSF for housing.
  • CBA -0.81% top of the apps.
  • SRX -0.06% US Federal Trade Commission says yes to deal.
  • Speculative stock of the day: Nothing special.
  • Biggest risers – GEM, COE, ING, HSN, SGF and KMD.
  • Biggest fallers – AX1, ORE, CLQ, FAR ,AJM and EVN.

TODAY

  • Emeco Holdings (EHL) –1.43% preliminary full year and 4Q earnings result. 4Q operating EBITDA was up 10% to $45m whilst FY18 operating EBITDA was up 83% to $153m. The company also deleveraged its balance sheet to a net-debt to Pro-forma run rate multiple of 2x.
  • Ramsay Healthcare (RHC) +0.86% The company has made an unsolicited approach to buy a Swedish Healthcare company Capio for just over $1bn. The vehicle is the French business, 50.9% owned French subsidiary, Ramsay Générale de Santé (RGdS). Capio has healthcare operations in five countries being Sweden, Denmark, Norway, Germany, and France, with sales totaling approximately €1.6bn and EBITDA of €116m. The board of Capio has rejected the bid and RHC does not seem to be keen to raise the price being offered just yet.
  • WAM Leaders (WLE) +0.42% FY18 results. The portfolio grew 17.8% YoY, beating its benchmark, the ASX200 accumulation index, by 4.8%. Operating profit before tax grew by 155.7% YoY to $100.5m and the board announced a 5cps dividend, a 66.7% increase YoY equating to a 4.3% fully franked yield.
  • Whitehaven Coal (WHC) –2.14% 4Q production report. The company has said it on track for a ‘record set of financials in FY18’ driven by thermal coal prices at 7-year highs. This is despite full-year sellable coal production flat at 20.9Mt YoY and full year coal sales only up 7% YoY to 22.1Mt. Production was hurt in 4Q by issues at the Narrabri Mine, total 4Q sellable coal production and sales were down 13% to around 4.7Mt each.
  • Yojee (YOJ) –7.69% Has completed its $8m share offer which was oversubscribed. It will issue 80m fully paid ordinary shares at 10c and also 26,666,667 options with an exercise price of 15c that expire in 18 months.
  • Mirvac Group (MGR) – Has signed Suncorp (SUN) as its major tenant for the 80 Ann st, QLD office development, for a 10-year contract representing roughly 66% of the floor space. The completion of the space is scheduled for FY22 and MGR has entered into a 50/50 joint venture for the site’s development with M&G Asia Property. M&G Asia Property will pay $418m for its 50%.
  • Downer (DOW) +1.26% Has won a contract for maintenance and support services for Chevron over a 5-year term.

ECONOMIC NEWS

  • Nothing today

BOND MARKETS

ASIAN MARKET NEWS

  • Chinese 2Q GDP grew in line with consensus at +6.7% QoQ, down from last quarter’s 6.8%. Industrial production for June came in at +6.0%, below expectations of +6.5%. June quarter retail sales saw 9% growth, beating estimates of 8.8%.

  • ZTE is back with big gains in Asian trade after settlement reached with US Treasury. Up 16% in HK.
  • Xiaomi fell as much as 9.6 % on Monday after the Shanghai and Shenzhen stock exchanges said it and other companies with dual-class share structures would be ineligible for trading through mainland market linkups with the Hong Kong Stock Exchange.

EUROPEAN AND US HEADLINES

  • Trump arrives in Helsinki for the summit with Vlad. Oil could be hit with increased Russian supply.
  • Boris ramps up the pressure on May over the weekend.
  • Airbus is close to a huge $29bn deal with a bunch of Asian carriers. Trade war working out well then.
  • European Council president Donald Tusk has called for reform of the World Trade Organisation as a counter to the US-led trade war and siding with China.
  • US yield curve lowest since 2007

And finally……………

A guy is sitting at home when he hears a knock at the door. He opens the door and sees a snail on the porch. He picks up the snail and throws it as far as he can. Three years later there’s a knock on the door. He opens it and sees the same snail. The snail says: ‘What the hell was that all about?’

irish

 

It’s the World Cup Final, and a man makes his way to his seat right next to the pitch. He sits down, noticing that the seat next to him is empty. He leans over and asks his neighbour if someone will be sitting there. ‘No,’ says the neighbour. ‘The seat is empty.’ ‘This is incredible,’ said the man. ‘Who in their right mind would have a seat like this for the Final and not use it?’ The neighbour says, ‘Well actually the seat belongs to me. I was supposed to come with my wife, but she passed away. This is the first World Cup Final we haven’t been to together since we got married.’ ‘Oh, I’m so sorry to hear that. That’s terrible….But couldn’t you find someone else, a friend, relative or even a neighbour to take her seat?’ The man shakes his head. ‘No,’ he says. ‘They’re all at the funeral.’

 

Clarence

XXXX

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NT Markets

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