The ASX 200 failed to hold above 5550 but still finished well off the day’s lows of 5513, closing down 9 points at 5544. Industrials and gold stocks were the winners, while Utilities and Telcos lagged. Asian markets were slightly softer with China down 0.06% and Japan down 0.06%. AUD 77.01 after the speech by RBA Governor Glenn Stevens and US Dow Futures down 11.
STOCKS AND SECTORS
- The banks were the major focus today after the Commonwealth Bank (CBA) -1.29% result. ANZ +1.17% continues to rise after its trading update yesterday, up 1.49%, while NAB +0.04% was up a touch and Westpac (WBC) -0.58% was weaker.
- Gold was one of the best performers, led by Beadell Resources (BDR) +6.32%. Newcrest (NCM) +4.26%, St Barbara (SBM) +4.87% and Regis Resources (RRL) +3.13% all doing well.
- Healthcare stocks also got a boost from positive research on Cochlear (COH) +7.61% after its results yesterday. Mayne Pharma (MYX) +2.00%, CSL +1.26% and Ramsay Health Care (RHC) +0.90% were all up, while ResMed (RMD) -0.44% didn’t fare as well.
- Utilities were weaker with AGL Energy (AGL) -3.83% down after reporting an increase in underlying profit but a move to loss due to impairment charges.
- Energy suffered due weakness in the oil price overnight. Santos (STO) -1.68% and Oil Search (OSH) -1.34% fell while Whitehaven Coal (WHC) -5.60% was once of the sector’s worst performers.
- In the consumer space, lowlights include Australian Agricultural Company (AAC) -3.38% and Metcash (MTS) -4.21%. Bellamy’s (BAL) -1.40% also struggled while Blackmores (BKL) +0.53% managed gains.
- Media stocks were hit after Fairfax Media (FXJ) -4.52% reported a similar fall in property listings during the half to those highlighted by REA Group (REA) -3.75% yesterday. Seven West Media (SWM) -4.40% was also lower.
- Speculative stock of the day: West African Resources (WAF) +34.38% after announcing a $21m placemen at 30c to accelerate development of their Tanlouka old project repaying Macquarie debt facility and leaving $30m in the bank.
- Commonwealth Bank (CBA) -1.29% reported a 3% rise to a record of $9.45bn slightly below analyst forecasts.in earnings for the year to June, despite slower conditions in the second half of the year. It will pay a final dividend of $2.22 a share, in line with analyst expectations. Impaired loans rose 27% in the year, to $1.25bn. Net interest fell from 2.09% to 2.07%. Shares rose initially to be up 0.87% before drifting lower.
- Computershare (CPU) +8.83% was runner-up in the results competition today after posting a revenue fall of 0.5%, down to $1.96bn. Constant currency basis it was up 5% to $2.1bn. Final dividend of 17¢ per share.
- Fairfax (FXJ) -4.52% reported a full-year loss of $893.5m compared with a profit of $87.2m in the prior year, driven by the $989m write-down of its publishing assets previously announced. Net profit was down 7.6% to $132.5m and revenue was down 0.6%. Fairfax pointed to weak trends in publishing, which have continued into early fiscal 2017. It also noted a similar decline in real estate listings to REA Group yesterday, saying new listings fell 25% in Sydney and 11% in Melbourne in July. Fairfax was down as much as 10.05% before recovering some lost ground.
- AGL Energy (AGL) -3.83% after substantially lifting the profit it makes per customer to $108 per household up from $86 a year ago. Underlying net profit to $701m. Impairment charges of $795m on gas write-downs in Camden and Gloucester in NSW. Final dividend of 36c, up 2c from a year ago.
- Both BHP -0.73% and RIO -0.65% have rejected the calls from the newly-appointed Nationals leader in WA for a new mining tax, adding a rental cost of $5 a tonne up from 25c.
- Oz Minerals (OZL)+1.59% after results showed lowest quartile C1 costs of US$73.8c/;b with NPAT of $55m and a strong cash balance of $564.3m.%8,368 tonnes of copper produced and 57,662 oz of gold.
- The Melbourne Institute/Westpac consumer sentiment index rose by 2% in August, up from 3% fall in July. A few economists view the rise as disappointing in light of the interest rate cut and the much larger impact that earlier interest rate cuts have had on the index. It reinforces the view presented by departing RBA Governor Glen Stevens today that the impact of monetary policy is diminishing as rates fall further.
- Glenn Stevens have his final speech as RBA Governor today. He noted there were limitations to the effectiveness of monetary policy in stimulating demand, suggesting governments should assume more responsibility for debt-financed infrastructure to help stimulate the economy. He also pointed to the future path of interest rates, saying the “effects of policies adopted elsewhere condition the policy choices available to us.” He added the “return to normal” would take ages and that normal is a different place now anyway.
- Steel and iron ore futures in China have come back for recent strength – rebar on the Shanghai Futures exchange was down 0.4% while the most active Dalian iron ore contract was off 1.2%.
- Japanese machinery orders rose 8.3% mom, much higher than the 3.1% increase expected, in a positive sign for capital expenditure. Manufacturers’ orders rose 17.7 percent while orders from the services sector were up 2.1 percent.
- Unemployment rate is the lowest in 21 years and the job-to-applicant ratio is the highest in 25 years. More than 1m new jobs have been created since Abe came to power in late 2012, labour-market rules mean most of the change is in non-permanent, lower-paying positions.
EUROPE AND THE US
- The richest man in the UK, the Duke of Westminster has died aged 64. The duke inherited land his family has owned since 1677, including swathes of London’s Belgravia and Mayfair neighbourhoods.
- An auction shortfall in the UK, where investors only offered £1.12bn of long dated government bonds for purchase by the BoE, well short of its target £1.17bn, despite above market prices being offered. The shortfall caused a rally in gilts (fall in yields).
The Italian Lover, a virile middle aged Italian gentlemen named Guido, was relaxing at his favorite bar in Rome when he managed to attract a spectacular young blond woman. Things progressed to the point where he led her back to his apartment and, after some small talk, they retired to his bedroom where he rattled her senseless.
After a pleasant interlude, he asked with a smile, “So, you finish?” She paused for a second, frowned, and replied, “No.”
Surprised, Guido reached for her and the rattling resumed. This time she thrashed about wildly and there were screams of passion. The sex finally ended and, again, Guido smiled and asked, “You finish?” Again, after a short pause, she returned his smile, cuddled closer to him and softly said, “No.”
Stunned, but damned if he was going to leave this woman unsatisfied, Guido reached for her yet again.
Using the last of his strength, he barely managed it, but they ended together screaming, bucking, clawing and ripping the bed sheets. Exhausted, Guido fell onto his back gasping. Barely able to turn his head, he looked into her eyes, smiled proudly and asked again, “You finish?”
Barely able to speak, the beautiful blonde whispered in his ear, “No, I Norwegian.”
Catch me on the ABC 7.30 report tonight talking CBA and those naughty banks.