ASX 200 fell another 45 points today to 5433 as reporting season winds up and resources suffer on a stronger dollar. Broad based losses continue, with specialist retailers the only bright spot. Asian markets positive with Japan up 0.97% and China up 0.34%. AUD 75.11c and US futures down 7 point.

Volatility is back. Since last Wednesday’s close the benchmark index has fallen four of five sessions to be down 2.3%

STOCKS AND SECTORS

  • Big miners suffered the slings and arrows today as profit taking, weaker commodities and that pesky stronger dollar took their toll. BHP -3.22%, RIO -2.66% and Fortescue Metals (FMG) -3.54%.
  • Gold stocks were also in the sellers’ sights today with big downside moves as the fairy tell unravels. Evolution Mining (EVN) -5.22%, St Barbara (SBM) -6.91% and Resolute Mining (RSG) -6.1%. Energy stocks falling with Santos (STO) -1.33% and Liquefied Natural Gas (LNG) 6.09-%. WorleyParsons (WOR) -3.09% selling off too plus ex dividend.
  • As Canberra returns, so do the calls for a Royal Commission into the financial services industry and the banks in particular. Not going to happen but noise not helping the sector. Broker upgrades today for ANZ +1.36% and downgrades for Commonwealth Bank (CBA) -1.50%. REITS slid, with Stockland (SGP) -1.42% and US Masters Resi Fund (URF) -2.01% whilst Gateway Lifestyle (GTY) +3.08% showed solid gains. Mind you they are down 16% post the results.
  • Industrials were weaker with some market darlings falling from grace. Telstra (TLS) -0.57% continued to weaken as did Vocus Comms (VOC) +0.65% and Speedcast (SDA) -2.75%. Transurban (TCL) -0.43%, Sydney Airport (SYD) -0.82% and Macquarie Atlas Roads (MQA) -4.97% slipping on higher rates.
  • Even healthcare stocks were on the nose today led by CSL -1.85%, Mayne Pharma (MYX) -3.14% and Fisher and Paykel (FPH) -1.80%. Residual buying and broker upgrades kept Ramsay Health Care (RHC) +% bubbling away.
  • IT stocks were mixed Covata (CVT) +16.00% spectacular whilst Nearmap (NEA) -3.45% a bridge too far. Urbanise (UBN) -16.00% a big casualty.
  • Speculative stock of the day: Realm Resources (RRP) +% after announcing the acquisition of a 70% interest in Foxleigh Coal mines in the Bowen Basin.

CORPORATE NEWS

  • Harvey Norman (HVN) +2.67% reported a strong 30% increase in profits to $348.6m beating forecast and a positive outlook statement. The bottom line result included property revaluations of $48.4m. Excluding the property revaluations, net profit rose 20.2% to $314.7m.
  • Adelaide Brighton Cement (ABC) -4.2% net profit was down 6.7% to $77.1m but when the impact of property sales was stripped out, net profit after tax was up 7.8% to $75.8m compared with the first-half last year. Eastern states construction markets to be robust for at least the next 18 months to two years. Adelaide Brighton will pay a special dividend of 4c on top of a higher interim dividend of 8.5c
  • Independence Group (IGO) -3.67% reported second half loss of $58.8m in part due to the acquisition costs of Sirius Resources at $64.8m and writedowns of $24.8m. Net cash flows from operating activities came in at $95.2m and the miner finished the year with a healthy cash balance of $46.3m.
  • Simonds Group (SIO) +32.76% after Gary Simonds last night reached a deal with Melbourne’s wealthy Roche family to sell the home builder for 40 cents a share. The company is valued at $57.5M and there has long been speculation that Gary Simmonds who founded the company would take back control after the float.
  • Atlas Iron (AGO) +10.00% has posted a full-year net loss to $159m, with the results affected by heavy writedowns and lower iron ore prices. However, underlying earnings, excluding the impact of impairments, rose to $74 m, compared to a loss of $51m a year earlier.
  • James Hardie (JHX) -2.43% may be the in line after the Apple ruling as their move to Holland may come into question. The stock moved first to the Netherlands and then to Ireland costing $63m in the process.

ECONOMIC NEWS

The RBA said that Australian Private Sector Credit rose to a seasonally adjusted 0.4%, from 0.2% in the preceding month.

ASIAN NEWS

  • Hong Kong home prices will fall a further 10 % as a pipeline of new developments is met by stalling income growth and looming interest rate hikes, Nomura Holdings Inc. said in a report.
  • Xiamen, a port city in eastern Fujian province, will suspend selling homes to local buyers who already own two residences, and will ban non-residents from buying a second house, authorities said on Wednesday.
  • South Korea’s biggest shipping group Hanjin is set to enter receivership after its creditors refused to provide further funding to the indebted firm. Hanjin, which is also the world’s seventh-largest container line, has been unprofitable for four of the last five years.
  • Japanese government debt is now 2 1/2 times the size of annual GDP and now has a total national borrowing burden that’s six times as large.

EUROPE AND THE US

Euro markets looking slightly weaker at the opening

  • Following the EU Commission ruling on Apple from Brussels, it looks like the TTIP or trade deal between the US and the EU is long dead and pining for the fjords. France called for a complete suspension of talks, accusing the US of blocking any workable compromise.
  • Meanwhile following the ‘Double Irish’ ruling the UK has laid out the ‘welcome mat’ for Apple if it finds Ireland an issue.

And finally………….

Some good old fashioned Jewish comedian jokes to finish Wednesday..

A  car hit an elderly Jewish man. The paramedic says, “Are you comfortable?” The  man says, “I make a good living.”

I  just got back from a pleasure trip. I took my mother-in-law to the  airport. 

I’ve    been in love with the same woman for 49 years. If my wife finds out, she’ll  kill me! 

Someone  stole all my credit cards, but I won’t be reporting it. The thief spends less  than my wife did. 

We always hold hands. If I let go, she shops.

My wife and I went to a hotel where we got a waterbed . My wife calls it the Dead Sea. 

My wife was at the beauty shop for two hours. That was only for the estimate.  She got a mudpack and looked great for two days. Then the mud fell off.

The Doctor gave a man six months to live. The man couldn’t pay his bill, so the doctor gave him another six months. 

Have a great hump day!

Clarence

XXXX

NT Markets

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