ASX 200 advances 39 points back to 5650 as materials and healthcare stocks do well. Banks trail behind as buyers step back in though caution persists. Asian markets hardly changed with Japan down 0.11% and China down 0.03%.AUD nudging 75.80c with US futures up 3 points.

STOCKS AND SECTORS

  • Banks and financials are still in the naughty corner with the Big Bank Basket (BBB) failing to fire again today despite a solid rally in the ASX 200. The BBB closed at $172.61 barely changed from yesterday as REITs did well with Goodman Group (GMG) +1.76% and Stockland (SGP) +1.39% and even wealth managers managed to eke out some gains as Pinnacle Investments (PNI) +4.94% after confirming its takeover approach to Hunter Hill International (HHL) -5.51%.
  • Miners led the charge as iron ore firmed in Asian trade with BHP+2.43%, RIO +3.78% and Fortescue Metals (FMG) +5.48%. BlueScope (BSL) +8.00% was the catalyst that sparked the revolution with base metal stocks joining the party as Independence Group (IGO) +3.10%, Metals Ex (MLX) +3.47% and Alumina Limited (AWC) +3.07%.
  • Energy stocks had a topsy-turvy day. Winners from yesterday were losers today. Woodside (WPL) -0.65% and LNG -6.25% and losers became winners Worley Parsons (WOR) +2.52% and Whitehaven Coal (WHC) +5.02%.
  • Gold stocks again in the winner’s enclosure as money flows to safe assets. Evolution Mining (EVN) +2.68%, Resolute Mining (RSG) +4.56% and Northern Star (NST) +3.30%
  • Industrials better today after the Brambles (BXB) +2.32% drubbing yesterday. Pact Group (PCT) +0.40%, CSR +2.59%, Boral (BLD) +3.06%, Orica (ORI) +2.25% and Incitec Pivot (IPL) +1.66%. Few fallers in consumer stocks though with Domino’s Pizza (DMP) -2.25% failing to deliver plus McGrath (MEA) -5.56%. Wil nobody take this disaster private?
  • IT stocks and telcos still mixed with TPG Telecom (TPM) -1.28%, Superloop (SLC) -1.96%, Carsales (CAR) -1.40% and Nearmap (NEA) -3.23% whilst Iress (IRE) +1.78% , Computershare (CPU) +1.77% and Speedcast (SDA) +4.93%
  • Healthcare better today as Resmed (RMD) +7.21% cheered and other health stocks fell into line. Primary Healthcare (PRY) +1.36%, CSL +0.91%, even Mayne Pharma (MYX) +2.40% and Viralytics (VLA) +11.90%
  • Speculative stock of the day: Mustang Resources (MUS) +35.71% another strong day following the announcement of the plant commissioning and the rubies delivered to the US on 20th January

CORPORATE NEWS

  • Macmahon Holdings (MAH) +31.82% after a takeover bid from the Spanish Cimic Group (CIM) +1.14% at 14.5c. CIM already owns around 20% of the mining services company. The offer is final and unconditional and values MAH at $172m.
  • BlueScope Steel (BSL) +8.00% has marched to a six-year high following an upgrade to the profit guidance from last December as strong iron ore and steel prices have turbo charged profits to around $600m according to the latest guidance.
  • Atlas Iron (AGO) -4.17% shipped 4m tonnes of iron ore for the quarter with cash now piling up with a $134m balance at year end as it races to pay down debt. Back in March 2015 AGO was teetering on the brink of extinct weighed down by a huge debt burden, yet now it could be net long cash in the not too distant future. Heavily geared to the robust iron ore price but at $80 a tonne things are definitely looking up.

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  • Resmed (RMD) +7.21% lifted second-quarter revenue 17% to $US530 million, helped by income from the Brightree business it acquired in 2016. Net income for the quarter was $US76.7m, a 20% decrease compared to the same period of the prior year. Revenue for the three months to December 31 rose 21% in the Americas to $US326.8m.
  • Bellamy’s (BAL) -1.82% as former CEO Laura McBain has now resigned from the board. It seemed only a month or so ago McBain was being feted in the AFR Boss section.
  • Duet Group (DUE) -0.35% after the Federal government announced plans for a new regulator of assets in the National interest.

ECONOMIC NEWS

  • Consumer sentiment rose solidly in January with the ANZ-Roy Morgan Consumer Confidence Index rising from 124.5 to 128.7 in January its highest level since April 2015.

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  • The TPP is dead. Trump has killed it and no amount of salvage talk will resurrect it. It is not resting like the Norwegian Blue at all.
  • Sydney real estate is so expensive the median is now $300,000 more than the second-highest priced capital in Australia, new data shows. By the end of 2016, Sydney’s median house price climbed more than 10% to a record $1,123,991, a Domain report has found. Meanwhile, the cost of renting an apartment in Sydney has fallen for the first time in two years. The median asking rent for apartments, which is the figure advertised to tenants, fell by 1% to $520 a week in December. Sydney now the second most expensive city for a home except for Hong Kong.

BOND CORNER

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ASIAN NEWS

  • Japanese manufacturing activity expanded in January at the fastest pace in almost three years as export orders surged.

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  • The Markit/Nikkei Japan Flash Manufacturing Purchasing Managers Index (PMI) rose to a seasonally adjusted 52.8 in January from a final 52.4 in the previous month.
  • A hedge fund manager in China sometime likened to Warren Buffett has been jailed for market manipulation along with two of his colleagues. Xu Xiang was charged with colluding to manipulate share prices in an operation from 2010 to 2015. The court fined the three a combined 12.05 billion yuan ($US2.3 billion), the largest ever in China for individual economic crimes, with 11 billion yuan of it imposed on Xu alone.

EUROPE AND US

  • The US has said it will ‘protect our interests’ in the South China Sea.
  • Yahoo revealed its US$4.8bn deal to offload its main web business to Verizon Communications has been delayed, just hours after it emerged the company is under investigation for the two record data breaches.
  • Bernie Ecclestone has been removed from his position running Formula 1 as US giant Liberty Media completed its US$8bn takeover of the sport. Bernie has run Formula 1 for the last 40 years.
  • Finally, in a win for equality, a red headed emoji is being discussed as the Unicode Technical Committee looks at whether to allow the ‘ranga’ emoji on to phones. Another win for social media?

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And finally…..

A young couple were married, and celebrated their first night together, doing what newlyweds do, time and time again, all night long. Morning comes and the groom goes into the bathroom but finds no towel when he emerges from the shower. He asks the bride to please bring one from the bedroom. When she gets to the bathroom door, he opened the door, exposing his body for the first time to his bride where she sees all of him well. Her eyes went up and down and at about midway, they stopped and stared, and she asked shyly, “What’s that?”, pointing to a small part of his anatomy. He, also being shy, thought for a minute and then said, “Well, that’s what we had so much fun with last night.” She, in amazement, asked, “Is that all we have left?”

Please send me more jokes!!!

Henry@marcustoday.com.au

Clarence

XXXX

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NT Markets

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