ASX 200 lost 27 points to 5508 on ‘Super Thursday’ as results dominated. Materials, consumer stocks good. Finance and healthcare bad. Asian markets mixed with Japan down 1.55% and China unchanged. AUD jumps to 77.12c after unemployment numbers at 5.7% US Futures up 11.
Result Roulette continues
STOCKS AND SECTOR
- Banks slid again with Commonwealth Bank (CBA) -1.24%. Insurers were under pressure after AMP -% results and the wash up of the QBE Insurance (QBE) -2.15%. REITS suffered some profit taking but aged care operator Aveo Group (AOG) +3.18% resumed after their successful $126m institutional placement.
- Materials and gold miners in the green today as gold stocks reversed falls from earlier this week Resolute (RSG) +9.14% and Evolution Mining (EVN) +4.03%. Fortescue Metals (FMG) +3.71% again firm ahead of their figures on Monday with one broker suggesting traders watch for an unexpected move on the dividend.
- Healthcare stocks were weaker across the board as CSL -2.83% continues to weigh and we saw both Resmed (RMD) -1.65% and Fisher and Paykel (FPH) -3.31% on their lawsuit on patent infringements. Pathology and Radiology stocks were also weaker with Ramsay Healthcare (RHC) -1.15% and Primary Healthcare (PRY) -5.25%.
- In industrials Pizza maker Domino’s Pizza (DMP) -3.87% slipped back after some indigestion on their results. Hard to believe the company is currently valued at over $7bn.
- Speculative stock of the day: NRW Holdings (NWH) +53.75% after announcing a positive profit report with NPAT rising to $21.5m complete with a positive outlook statement.
CORPORATE NEWS- Pick of the bunch
- The big four Australian banks, Macquarie (MQG) +0.11%and a dozen international investment banks who were members of the panel that set the bank bill swap rate have been sued in the US District Court by two US hedge funds and a derivatives trader.
- Origin Energy (ORG) -1.20% has cut the dividend putting the priority on debt reduction after posting a $589 million full-year loss. Underlying profit before impairments plunged 41%in the year ended June 30 to $354m, falling short of estimate around $390m.
- Bapcor (BAP) +6.06% is expecting another year of strong profit growth in 2017 after lifting net profit 89% to $43.6m in 2016. Sales up 82.7 % to $685.6m, boosted by the $283m acquisition of Metcash’s Autobarn, Autopro and Midas mufflers businesses in 2015.
- Treasury Wine Estates (TWE) +11.52% reported a net profit after tax of $179.4m up from $77.6m a year ago, and beat its own upgraded profit forecast handed down just six weeks ago with EBIT of $342 million.
- IRESS (IRE) +9.75% said its statutory net profit for the six months ended June 30 rose 15 % to $32.7 million from the year-earlier period. Operating revenue increased to $194.3 million. On a constant currency basis, this represented a 14 % increase on the year-earlier period.
- Sydney Airport (SYD) +0.27% raised its full-year dividend guidance after reporting a 19% rise in interim net profit to $159.6m. Another good result. Chinese travellers have been the fastest-growing group of international passengers, with numbers rising 19.6% in the six months to June.
- Whitehaven Coal (WHC) +3.92% conformed its turnaround credentials after announcing a $20.49m profit up from a $330.63 m loss a year earlier. No dividend though yet.
- ASX -% reported a 5.7% lift in profits to $426m. Final dividend of 99c. Revenue rose 6.5% to $746.3m on good trading revenues from derivatives and issuance.
- Brambles (BXB) -0.15% disappointed with a 6% fall in profits to US$557.4m and the CEO announced his retirement to be replaced by UK Rexam Packaging CEO Graham Chipchase.
- Webjet (WEB) +20.50% stunned the market with a 27% leap in profits to $22.22m and a final dividend of 8c. Margins good and bookings a positive and the company announced a tie up with UK’s Thomas Cook. Flight Centre (FLT) -3.02% were sold off on the back of thee results.
- AMP -% fell after disappointing numbers from the wealth division and life products. Again. CEO was disappointed on losses in its wealth protection business and is fixing it. Or so he says.
- Villa World (VLW) +2.79% net profit for the year to June rose 31.5% to $33.7m as settlements of new house and land packages jumped by almost one-third. Final dividend of 10c, bringing its full-year payout to 18c, up from 16c.
- ABS unemployment figures today. Another volatile number with most experts scratching their heads again. With a headline rate of 5.7% it is hard to see a reason for the RBA to cut again.
- The total number of people with jobs rose by 26,200 in July, as the economy added 71,600 part-time jobs which more than made up for the loss of 45,400 full-time jobs.
- NSW going gangbusters. ACT and VIC other standouts.
- The participation rate remained steady at 64.9%.
- Good for government revenues perhaps? Prices for Australian thermal coal from Newcastle a proxy for the Asian benchmark, have soared over 35% since mid-June to more than one-year highs of almost $US70 a tonne.
- Moody’s has increased its GDP forecasts for China to 6.6% this year and 6.3% in 2017, and for the other G20 emerging markets to 4.4% for 2016 and 5% for 2017.
- A stronger yen as it went through Y100 to the USD was keeping a lid on Asian markets.
- The world’s biggest personal computer-maker, Lenovo, said first-quarter earnings rose 64% to US$173m beating expectations. The company said its PC business had delivered “strong profits” despite a slowdown in the overall market. However, revenue fell by 6% from a year earlier to US$10.1bn in the three months to June. ‘Challenging environment’ was mentioned.
- Spare a thought for Mongolians, where the central bank has just hiked rates by 4.5% to 15%.
EUROPE AND THE US
- French jobs data and UK retail sales.
- Positive opening in store for Euro markets
- The UK economy will slow down but should not go anywhere close to a recession, according to economists at credit ratings agency Moody’s, while growth in the rest of the world is also “stabilising.” Moody’s economists predict growth of 1.5% this year and 1.2% in 2017. Moody’s does not expect a major collapse in house prices or a big drop in consumption.
Someone going to work sees a crowd of people walking. Looking at the beginning of course, he sees a coffin behind a gentleman with a little dog followed by the crowd. Approaching the owner and he asks him: “What happened here, man?” “Pff, my mother-in-law died,” he said. “Hush how sad eh… And, if allowed, how?” “My dog bit her…” “You don’t tell me! Could you lend him to me just for tonight?” “Get in line!”
A distraught senior citizen phoned her doctor’s office. “Is it true,” she wanted to know, “that the medication you prescribed has to be taken for the rest of my life?”
“Yes, I’m afraid so,” the doctor told her.
There was a moment of silence before the senior lady replied, “I’m wondering then, just how serious is my condition because this prescription is marked ‘NO REFILLS’?”