Friday 15th February – Australian Market Wrap

ASX 200 up 7 to 6066. US futures down 50. Corporate results continue to dominate as the ASX 200 treads water. Banks pick up on book squaring as miners slip ahead of the weekend. CSL back under pressure together with AMP. Another big week in store. Domain Group (DHG) results were better than expected, pushing the stock up 21%. AOG rallied hard on media speculation of a takeover bid. Carsales (CAR) saw bargain hunting up 5.6% and Whitehaven Coal (WHC) fell in a bunker down nearly 7%. Medibank Private (MPL) released a messy result which pleased the market up 3%. AUD steady.

Todays Highlights

  • ASX 200 grinds up 6 points to 6066 after a big week or results
  • High 6076 Low 6049. Range narrows.
  • Index down 5 points for the week.
  • Banks see buyers as miners fade.
  • Energy stocks still in demand.
  • REITs do well as does TLS.
  • AUD steady at 71.05c
  • Bitcoin slips to US$3578
  • Aussie Gold firms to $1847
  • US futures down 46. Trump hits the emergency button.
  • Asian markets weaker with China down 0.90%  with Japan down 1.23%.

STOCKS IN FOCUS

  • NEC +7.22% Owner of DHG.
  • CCL -2.44% Coke warns of headwinds.
  • JIN +6.27% hits the jackpot.
  • Z1P +5.02% finding buyers still.
  • AHG -8.15% non-cash impairments in refrigerator business.
  • LYC +11.89% gets tentative approval for its LAMP waste.
  • SSM -5.33% change in directors interest.
  • NEA -2.45% profit-taking  – results next week.
  • BBN -6.01% results disappoint.
  • BID -5.88% profit-taking.
  • EXL +7.14% hemp oil feeling the love.
  • Speculative Stock of the Day: Nothing special on volume.
  • Biggest Risers – DHG, LYC, AOG, BGA, NEC, JIN and CAR
  • Biggest Fallers – AHG, WHC, SSM, ELD, BAP, TWE and A2M

TODAY

  • Automotive Holdings Group (AHG) –8.15% Expects to realise a $226m non-cash impairment charge in its half-year results, reflecting a more cautious view of the balance sheet in light of current market conditions. Half-year operating NPAT which excludes one-offs is in line with AHG’s internal expectations.
  • Baby Bunting Group (BBN) -6.01% First half pro-forma NPAT came in above estimates at $6m vs $4.2m expected. Revenue beat estimates at $177m, adjusted EBITDA came in just short at $11.6m vs expectations of $11.9m. Comparable same-store sale growth was 9.5%. FY19 EBITDA guidance reaffirmed, expected to be between $25 and $27m.
  • Whitehaven Coal (WHC) -6.68% Looks like a miss, with NPAT coming in at $305.8m versus an expectation of $374.3m. Revenue $1.27bn vs $1.29bn. Underlying EBITDA $550.8 vs $603.4. Guidance looks mixed; production is set to rise from 21.5mt to 22.5mt but costs are expected to increase from $64/t to $67/t.
  • Link Group (LNK) -1.28% First half operating NPATA has come in stronger than last year, coming in at $107.8m vs $92m from a year ago. Revenue beat expectations, at $714.4m vs $699.23 expected. EBITDA was a slight miss; $185.4m vs $191.7m.
  • Medibank Private Limited (MPL) -2.90% Looks like a miss on the bottom line. First-half NPAT came in at $207.7m vs expectations of $214.2m. Revenue was a slight beat at $3.24bn vs $3.54. MPL said management expenses for FY19 are targeted to be modestly above those recorded in FY18. In the short to medium term, MPL also sees the potential to make 1-2 more small acquisitions to build health services capability.
  • Domain Holdings (DHG) +21.05% First half NPAT beat, coming in at $21.1m vs $20.7m expected.Revenue missed very slightly, at $183.9m vs $184.3m. EBITDA beat at $52.7m vs $49.5m. The outlook was mildly positive, noting that the first six weeks of FY19 H2 saw continued growth in yield, despite lower listings volumes. For FY19, Domain’s underlying costs are expected to be slightly down against proforma FY18.

ECONOMIC DATA

  • Assistant governor Christopher Kent talked about financial conditions and AUD developments. Got the time to read the transcript here is the link.

BOND MARKETS

  • 2-Year bond yields down 2bps to 1.72%
  • 5-Year yields down 4bps to 1.74%
  • 10-Year yields down 5bps to 2.10%

ASIAN NEWS

  • China’s factory gate prices barely rose in January, with an official gauge of producer price growth dropping to its lowest level since 2016.

  • In Singapore, GDP increased an annualized 1.4% from the prior quarter, lower than the government’s earlier projection of 1.6% and the median forecast of 1.5%.

EUROPEAN AND US NEWS

  • Breaking news. US and Chinese official are working on an MOU to enable talks between the two leaders but it will not be until next month. A 60-day delay now seems the most likely.
  • Buffet has cut his stake in Apple and increased his JP Morgan holdings.
  • German insurer Allianz has announced a new EUR1.5bn share buyback programme.
  • GE scraps plans for a 12-storey HQ in Boston. Not a good day for HQs in US cities.
  • US Coca Cola has warned of slowing global growth and the rising uncertainty in markets.
  • UK PM MAY says no-deal Brexit more likely after latest defeat.

And finally…………..

Have a great weekend …thanks Al for the great content this week

PARAPROSDOKIANS  are figures of speech in which the latter part of a sentence is unexpected; Winston Churchill loved them:

  1. Where there’s a will, I want to be in it.
  2. Since light travels faster than sound, some people appear bright until you hear them speak.
  3. If I agreed with you, we’d both be wrong.
  4. War does not determine who is right – only who is left.
  5. Knowledge is knowing a tomato is a fruit.  Wisdom is not putting it in a fruit salad.
  6. They begin the evening news with ‘Good Evening,’ then proceed to tell you why it isn’t.
  7. To steal ideas from someone is plagiarism.  To steal from many is called research.
  8. In filling in an application, where it says, ‘In case of emergency’, notify:  I put ‘DOCTOR.’
  9. I didn’t say it was your fault, I said I was blaming you.
  10. Women will never be equal to men until they can walk down the street with a bald head and a beer gut, and still think they look sexy.
  11. Behind every successful man is his woman.  Behind the fall of a successful man is usually another woman.
  12. A clear conscience is the sign of a bad memory.
  13. I used to be indecisive.  Now I’m not so sure.
  14. Nostalgia isn’t what it used to be.  Nor is there any future in it.
  15. Change is inevitable, except from a vending machine.
  16. Going to church doesn’t make you a Christian any more than standing in your garage makes you a car.
  17. Finally: I’m supposed to respect my elders, but it’s getting harder and harder for me to find one now.
  18. I am not arguing with you, I am explaining why you are wrong.

Clarence

XXX

mt_tryforfree

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