After a disappointing lead and the gold price getting smashed once again we saw some tentative buying emerge as the day wore on. A low of 5310 was reached mid-morning before a grind out rally occurred with the market closing at 5337 down 10 points. Interestingly the ASX 20 leaders were actually positive albeit just. It was a very mixed performance with Iron Ore stocks better led by BHP Billiton Limited (A$35.92, +0.5%),RIO Tinto Limited (A$62.38, +1.4%) and Fortescue Metals Group Ltd (A$5.17, +1.6%). Banks were a tad weaker except Westpac Banking Corporation (A$33.86, +0.7%) and newly invigorated Macquarie Group Limited (A$56.53, +0.2%) although other fundies and financers were not so happy with Henderson Group PLC. (A$4.61, -1.1%),Flexigroup Limited (A$3.51, -2.5%) and Challenger Limited (A$6.44, -0.9%) all losing ground.
Industrials were mostly in the red today utilities , retailing, consumer discretionary struggling too. Metcash Limited (A$2.67, -1.1%) continued their decline but Wesfarmers Limited (A$41.86, +0.6%) had a little green quote instead. Energy stocks like Sino Gas & Energy Holdings Limited (A$0.17, -8.1%),Santos Limited (A$13.18, -1.3%) and Woodside Petroleum Limited (A$38.36, -0.7%) all suffering the slings and arrows. Healthcare took a hit following big falls in US biotechs with recent glamours Unilife Corporation (A$0.875, -6.4%) feeling the prick of a bubble bursting. Tech stocks also fell as the high flying NASDAQ hit the skids last night and investor enthusiasm waned considerably. REA Group Ltd (A$47.00, -2.3%), Webjet Limited (A$2.68, -2.5%),Seek Limited (A$16.86, -1.4%) and Carsales.Com Limited (A$11.34, -1.4%)
Volume was ordinary again at around $4bn with Country Road Limited (A$13.00, +17.3%) the stand out performer on a massive 80 shares today.28,000 shares have now traded in 2014!Others to stagger out of the gloom included Premier Investments Limited (A$8.95, +11.2%),Tpg Telecom Limited (A$6.18, +7.3%),iiNet Limited (A$7.97, +5.3%),Energy World Corporation Ltd (A$0.315, +1.6%),Greencross Limited (A$7.76, +2.8%) and David Jones Limited (A$3.17, +2.6%) whilst lurking in the shadows like a wounded bear were Yancoal Australia Limited (A$0.455, -21.6%),Beadell Resources Limited (A$0.60, -11.8%),Oceanagold Corporation (A$2.48, -8.8%),Iproperty Group Limited (A$3.68, -2.4%),Myer Holdings Limited (A$2.29, -5.4%),Donaco International Limited (A$1.40, -5.1%),Newcrest Mining Limited (A$10.25, -5.0%) and Mesoblast Limited (A$5.15, -4.8%). In fact a raft of 4-5% losses in mid cap land with a few companies taking advantage of this bull market to raise money. Donaco International Limited (A$1.40, -5.1%) joined the ranks as did G8 Education Limited (A$4.76, unch).
Meanwhile in Asia we had a push me pull you day, Tokyo and China small up Hong Kong small down. The S&P Asian 50 index was up 1.4%whilst Gold was still struggling around $1313 and the Aussie dollar traded at 2014 highs at around 91.38.Bitcons were $630 BTW.
Stocks and Stories
Donaco International Limited (A$1.40, -5.1%) returned to the market today after raising $75m for nothing in particular really. Just did. The Vietnamese casino is fully funded so the question is what is the money for.Sure they have something in mind. Time will tell.Other house stocks in the limelight included Strata-X Energy Limited (A$0.335, -4.3%) after closing their transaction to increase Illinois Basin assets.
Orica Limited (A$21.45, -2.8%) has reached a second deal to buy natural gas from junior explorer Strike Energy Limited (A$0.125, unch) as it seeks to lock in gas supplies for its east coast production plants in a market plagued by surging prices and potential shortages. The gas supplied under the two deals between the two should be worth more than $1 billion, Strike said.
Tpg Telecom Limited (A$6.18, +7.3%) has upgraded its earnings guidance to produce a strong balance sheet and increased speculation it could make a move on rival telecommunications provider iiNet. EBITDA rose by 8 per cent to $165.6 million for the first half of financial year 2014, which was above analyst expectations of around $149 million. Net profit for the half was up 15 per cent compared to the same period in 2013 to $90.1 million.
Old king coal was not such a merry old soul at all. No hope, not New Hope Corporation Limited (A$3.15, -1.3%) announced that in the six months to the end of January, its net profit slumped to $22.7 million from $68.8 million a year earlier, even though coal sales rose to 3 million tonnes from 2.7 million tonnes.
Who would have thought that stationary and PJs would be so popular but Mark McInnes ex DJS head has blown away his competitors again today with the Premier Investments Limited (A$8.95, +11.2%) ‘ EBITs rose 9.2 per cent to $61.5 million as stronger sales and lower costs offset weaker gross margins. The profit result was in line with market forecasts, but sales growth exceeded expectations. Retail sales rose 5.3 per cent to $468.4 million and like-for-like sales by 4.4 per cent as six of the seven brands in the group achieved sales growth
Tomorrow’s News Today
Sanctions starting to bite as Russia braces for the cold shoulder from the G7 club. Kicked out RasPutin, take that as they expect $70bn to exit the country as a result. I would imagine that the oligarchs were long puts before the invasion of Ukraine. I know I would be.
A global crackdown on internet companies avoiding tax by offshoring looks to be in the offing. The OECD has issued a report suggesting that companies should pay tax in the countries that they produce the sales in. What a novel idea. May even catch on!
France’s private sector companies grew at their fastest pace in two and a half years in March, bucking forecasts for a further contraction, a survey says. The preliminary estimate of Markit’s composite Purchasing Managers’ Index (PMI) for France was 51.6 in March, up from February’s 47.9 reading and above the 50 level that indicates expansion.
Have a read of this Mr Abbott and Mr Hunt. Manufacturing giant Siemens and the UK’s Associated British Ports are to invest a total of £310m in UK wind turbine factories, creating 1,000 jobs.Siemens will put up £160m – doubling its previous plans to invest £80m in wind turbine production in the UK.
And still in the UK one millionaire business owner has come up with a unique succession planning strategy. Give the company away! The leader of a global PR firm, which represented the Dalai Lama and the Prince of Wales, is giving his company, worth up to £1m, away. Simon Cohen said he wanted to focus on his family as he thought “jet-setting around the world” as head of Global Tolerance was missing the point. He will hand over 95% of the company, with £10,000, and 10 years’ worth of business contacts, he said. Applicants should apply soon. Suspect there will be a rush. All good PR for his firm too! There, I am a cynic!
I reckon this inventor is on to a winner with her Sugru. The material can be shaped for 30 minutes after being taken from the small sealed packets it comes in, before it cures in the air into a strong, durable and waterproof substance that will stay stuck to almost any surface and can withstand extremes of temperature up to 150C.It has been compared to as significant an invention as sticky tape or blu tack. Expect we will be hearing a lot more of this. Google are using it too.
Back to Ukraine for just a minute as a leaked conversation between parliamentarian Nestor Shufrych and former PM and ideological leader of the Ukraine “revolution” Yulia Tymoshenko and most probable future president of West Ukraine, contained this gem about the Russian population, “They must be killed with nuclear weapons.” Nice thought to end with.
That’s all folks