ASX 200 down 7 points to 5453 in lacklustre trading as we failed to make it 9 from 9. Banks and miners dragged us lower whilst consumer and healthcare stocks held the line. Asian markets mixed as Japan rose 1.37% and China fell 0.59%. AUD eased on RBA meeting minutes to 75.08c and US futures are down 2 points.
STOCKS AND SECTORS
- Miners took a well-earned break today after some stunning rises with base metal stocks falling back a little. South32 (S32) -4.57%, Oz Minerals (OZL) -1.31% and Syrah Resources (SYR) -11.09%. Iron ore stocks also came in for profit taking as steel and ore futures fell in China. BHP -1.93% and RIO -2.29%. Gold stocks also gave up recent gains, Beadell Resources (BDR) -5.32%, St Barbara (SBM) -2.83% and Newcrest (NCM)-1.63%.
- Banks were mixed with the big four rallying slightly into the close after 1% falls. The big four basket currently $157.
- REITS were better again with Stockland (SGP) +1.44% and Goodman Group (GMG) +1.10% showing the way. Insurers fell with Medibank Private (MPL) -3.85% the worst of them.
- Mining services have started to grab a little attention following in the wake of the rising commodity prices and mining shares. Watpac (WTP) +6.02%, Maca (MLD) +5.25% and Bradken (BKN) +6.54%.
- Healthcare, consumers and tech stocks improved. MYOB (MYO) +1.4%, Xero (XRO) +0.59%, Link Administration (LNK) +0.81% and Covata (CVT) +7.69%. Utilities back in favour too as risk off trading back, with AGL +2.14% and Duet Group (DUE) +2.78%.
- IPO in focus: Oventus (OVN) +40.00% on its first day of trading for the sleep disorder device maker. A promising start on decent volume of 700,000 shares.
- Speculative stock of the day: Sundance Energy (SEA) +33.33% after a cleansing notice and the issue of 552.6m shares and news that it had received a conditional non-binding offer to acquire all of its shares at US14c. The offer undervalues the company according to the board
- RIO -2.29% following production numbers that were lower than some analysts had expected at 80.9mt shipped from WA. The company did however reaffirm its production guidance.
- Orocobre (ORE) -2.02% after quarterly reports and a Melbourne Mining Club function this evening. Ramp up continues at the Olaroz lithium facility with 2,971 tonnes of lithium carbonate produced up 27% on the previous period.
- CSL +0.69% following FDA approval for its Berinert paediatric treatment for Hereditary Angioedema.
- Audio Pixels (AKP) +9.31% after announcing that TowerJazz, a global specialty foundry leader, had been signed to mass produce its ground breaking new loudspeaker chip.
- The RBA has kept open the prospect of another official interest rate cut next month, saying it was awaiting fresh information on inflation, jobs and the property market. Policy makers anticipate inflation will remain below the 2-3% target given “very subdued” growth in wages and global downward price pressures. The board concluded Brexit would have only a “modest adverse effect” on the global economy.
- RBA Minutes: “Taking account of the available information, the Board judged that holding monetary policy steady would be the most prudent course of action at this meeting. The Board noted that further information on inflationary pressures, the labour market and housing market activity would be available over the following month and that the staff would provide an update of their forecasts ahead of the August Statement on Monetary Policy. This information would allow the Board to refine its assessment of the outlook for growth and inflation and to make any adjustment to the stance of policy that may be appropriate”.
- ANZ/Roy Morgan Consumer confidence fell 0.3 points for the week, down from 115.2 to 114.9.
- Meanwhile across the ditch the RBNZ is now going to require investors to have a deposit of at least 40% for borrowing for home loans. The new rule will start from September 1 and tightens the existing 30% requirement.
- Chinese steel futures fell more than 5% on Tuesday, extending a decline in the previous session as slower home sales led to profit taking.
- On the Dalian Commodity Exchange, the September iron ore contract dropped nearly 4% to 429 yuan a tonne by midday. Coke fell more than 2% and coking coal dropped nearly 1%
- Authorities have banned testing and using self-driving cars pending regulations.
- Nintendo shows no sign of letting up as the Pokemon Go smart phone game takes the world by storm.
EUROPE AND THE US
- Trump used the Republican Convention to push for a breakup of the banks and the reinstatement of the Glass-Steagall Act if elected. Banks likely to be most affected by the proposal would be Bank of America, Citibank and JPMorgan.
- US and European leaders have warned Turkey over a pre-prepared list of people to round up. Captain Renault has suggested rounding up the usual suspects.
- Can anyone blame the UK for not wanting to remain in this club. Euro countries are supposed to keep their budget deficits below 3% of GDP or risk being fined. Spain has failed every year since 2008. Portugal has failed 15 times, France has been above the 3% of GDP threshold 12 times whilst even Germany is up to 7 times a failure.
- More Brexit fallout as the IMF is likely to cut its 2016 UK growth projection to below 1.7%, from a forecast of 1.9% in April. Growth in 2017 is likely to be forecast to be below 1.4%, down from an estimate of 2.2% three months ago.
- Early indications for small falls in European markets.
A man wakes up and finds himself in a hospital room, one with only himself in it.
He has no recollection of how he got there.
While pondering it, his bedside phone rings, and he answers it. A doctor on the other end identifies himself, and tells the man: “I have really bad news. You’re very sick. After your collapse yesterday, we ordered several tests, and got the results back this morning. I’m afraid you have Avain flu, Ebola, and you’re positive for HIV and hepatitis.”
Stunned, the man asks “Well, what’s next!? What are you going to do?”
The doc replies: “Well, for starters, we’re putting you on a strict diet of only pizza.”
The patient asks: “Will that really help me, doctor?” “No”, the doc responds. “But it’s all we can fit under the door.”
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