ASX 200 finished another solid day up 17 points at 5557 on continuing consumer optimism and stronger commodity prices. Asian markets weaker ahead of BOJ moves on Friday. Japan slipped 0.97% with China down 0.29%. AUD rose to 75.22c with US futures up 31.

A solid day again with resources and gold miners leading the way. Industrials firm again as banks failed to fire and energy slipped on oil price falls.

As we head into this reporting season, it is interesting to look at the relative performance of the sectors since the last reporting season in February.

  • Materials up 36%
  • Banks up 0.4%
  • Retail up 11%
  • Energy up 12%
  • Food and Staples down 1.4%
  • ASX 200 Resources up 43%
  • ASX Gold index up 95%
  • ASX 200 up 10%
  • Small Ords up 19%


  • Continued strength in iron ore and positive updates to Fortescue Metals (FMG) +4.76% ensured the big miners bubbled along with BHP +0.55% and RIO +2.1%. Base metal stocks also in demand with lithium stocks Pilbara Minerals (PLS) +13.27% putting in strong showing as did Iluka Resources (ILU) +2.34%.
  • The rally in bullion continues as the Fed holds fire. Evolution Mining (EVN) +4.43%, Saracen Minerals (SAR) +5.99%, Resolute Mining (RSG) +8.62% some of the big winners again.
  • Industrials dominated by consumer and media stocks today. Aristocrat Leisure (ALL) +1.83%, (REA) +1.41% and Ten Network (TEN) +6.47% amongst the performers. Also good moves from China facing vitamin and dairy companies, A2Milk (A2M) +2.79% and Bellamy’s (BAL) +5.2% the stand outs following the good media coverage of the Swisse sales in China.
  • Banks were mostly unchanged despite a positive update from Macquarie Group (MQG) +1.36%. Other fund managers also gained in sympathy with Henderson Group (HGG) +5.21% ahead of figures and Wilson Group (WIG) +2.84% with Hub24 (HUB) +4.19%.
  • Speculative stock of the day: Dimerix (DXB) +42.86% after announcing a pre-clinical program to target Heterodimers active in NASH a major liver disease.


  • Virgin Australia (VAH) unchanged says its full-year net loss more than doubled to a $224.7m from a year ago, hurt by the one-off costs of a restructure to cut capacity amid stiff competition.
  • GUD -%2.17 reported EBIT of $80.8 million below the guidance range provided in February. The result was dragged down by $75.7m write down on the value of the troubled Dexion business, which now has a holding value of $44m.
  • BHP Billiton (BHP) +0.55% will record a provision of between $US1.1bn and $US1.3bn for the Samarco dam disaster when it reports full year financial results next month.
  • Macquarie Group (MQG) +1.36% has reaffirmed its earnings guidance that 2017 profit will be “broadly in line” with this year’s record, despite softer first-quarter operating results.
  • According to Moody’s Investor Services Telstra (TLS) -0.17% may need to cut its dividend and reduce debt to maintain its credit rating. The company sees a risk from the NBN taking 5% of its annual revenues. Its profit margin, one of the highest in the world, is expected to drop from about 42% currently to 30% once the national network is completed.
  • Freelancer (FLN) +3.41% posted a net loss of $778,000, a 62% improvement on the previous year loss. The company had record revenue of $26.2m for the first half up 56% on the previous corresponding period with the company hoping to turn profitable in the ‘near future’.
  • We must be in a bull market as Hotcopper is once again trying to raise capital and list on the ASX. It hopes to issue 110m at 20c to raise $12.2m and enable it to buy ReportCard the company that owns the chat forum.
  • AMP China Growth Fund (AGF) -1.63% will be wound up after the manager AMP flagged a slow wind down which may not please activist shareholders looking for a quick profit.


  • The Import Price Index fell 1.0% in the June quarter 2016.


  • The Export Price Index rose 1.4% in the June quarter 2016.



  • Chinese regulators are planning a tough clampdown on wealth management products to curb risks to the banking system.
  • Samsung reported second-quarter profit that beat analysts’ estimates, fueled by stronger sales for Galaxy S7 smartphones and aggressive cost cuts. Net income 5.83 trillion won ($5.1 billion) in the period ended June. The company also announced a 1.79 trillion won share buyback.


Mixed leads for European markets but corporate earnings seen positive.

  • Credit Suisse returned to profit during the second quarter, with all operating units contributing to its first positive result since CEO Thiam set out to reinvent the Swiss bank. Net income fell 84% to 170m Swiss francs in the three months through June, compared with 1.05 billion francs (US$1.06 billion) a year earlier. Analysts were expecting a loss of 178m francs.
  • Eurozone GDP is now 0.4% larger than it was in first quarter of 2008, taking eight years to return to pre-GFC levels.
  • Renault SA’s first-half earnings jumped 41% as demand grew in Europe for new models. Operating profit rose to 1.54 billion euros (US$1.7 billion) from 1.1 billion euros a year earlier beating estimates.
  • Danone, the world’s largest yogurt maker, reported first-half earnings that beat analyst with adjusted operating income rising 7% to 1.48 billion euros (US$1.6 billion), Second-quarter sales growth of 4.1% better than expected.
  • Meanwhile in the UK, investment in the new nuclear plant to be built in Hinkley Point, Somerset, is set to get final approval on Thursday. The French utility, EDF, the company financing most of the GBP18bn project, is holding a board meeting at which it is expected to approve the investment.
  • UK economists expect gross domestic product to fall this quarter and next after the decision to leave the European Union hit consumer and business confidence.

And finally…………..

An  Aussie stockman and his wife had just got married and found a quiet
hotel for their wedding night.

The man approached the front desk and asked for a room.

He said, ‘We’re on our honeymoon and we need a nice room, with a good
strong bed.”

‘We have many suites’, then the clerk winked, ‘You want the ‘Bridal’?’

The drover reflected on this for a moment and then replied,

‘Nah, I reckon not. I’ll just hold onto her ears until she gets used
to it.’





NT Markets

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