ASX 200 limped to close down 2 at 5760 after early losses to 5739 as resources dragged and banks and Telstra held the line. Ex dividends also taking their toll. Industrials mixed again as volumes and conviction remain low. Asian markets barely moved too with Japan down 0.515 and China up 0.06% AUD stuck at 76c in listless trading and US Futures down 35.

STOCKS AND SECTORS

  • Banks doing well as the parliamentary inquiry wrapped up today with Brian Hartzer from Westpac (WBC) +0.41% the last to face the inquisition. Relief as once again banks batted away calls for a Royal Commission and seem to once again have been let off the hook. Other financials mostly weaker as were REITs with Stockland (SGP) -1.26% and Mirvac (MGR) -0.92%. Money managers also continue to feel unloved with Magellan Financial (MFG) -1.28% and Flexigroup (FXL) -2.50%.
  • Miners were weaker as the profit taking continues on a higher USD. BHP -1.06% RIO -0.36% and Fortescue Metals (MFG) -1.28% all giving up ground as did base metals with South32(S32) -0.71% and Independence Group (IGO) -0.82%. Lithium stocks remain on the nose as Orocobre ((ORE) -3.17% fell away again.
  • Healthcare stocks mixed as Trumps tweets on drug pricing hurt Mayne Pharma (MYX) -1.84% though CSL +0.82% managed to eke out small gains. Mesoblast (MSB) +5.67% pushed through resistance at 200c and could now target 220c on the FDA news of fast tracking for GVHD. Fisher and Paykell (FPH) +0.81% held an investor day in NZ today stressing the relative value of the company compared with Resmed (RMD) -0.85%.
  • Industrials mixed again as Telstra (TLS) +0.65% perked up as did Chorus (CNU) +1.94% and Speedcast (SDA) +2.41%. Agri stocks under some pressure with Bellamy’s (BAL) -3.90%, A2Milk (A2M) -1.76% and Select Harvest (SHV)-1.69% after going ex-dividend yesterday.
  • Speculative stock of the day: Matador Mining (MZZ) +30.00% on its debut today with a gold and copper project in WA. Queensland Bauxite (QBL) +37.50% also in the winners’ circle today after announcing a move into medicinal cannabis a few days ago by acquiring 55% of an unlisted public company called Medical Cannabis (MCL). MCL controls its own medicinal seed bank developed since 2010.

CORPORATE NEWS

  • Domino’s Pizza (DMP) +0.38% will complete an audit of all 740 franchised stores in Australia by the end of June to ensure franchisees are complying with labour regulations.
  • Macmahon Holdings (MAH) unchanged after Perth hedge fund 3rd Wave Investors have sold most of its 6% stake in the company. The stock was bought by a range of institutional investors including Adam Smith Asset Management, Forager Funds and Sandon Capital and newcomers including IFM Investors, Ellerston Capital and Ophir Asset Management.
  • Orocobre (ORE) – 3.17% advised the market that the Sales de Jujuy operator for the Olaroz lithium facility has paid the latest interest and principal instalment and is strongly cash flow positive.
  • Lynas Corp (LYC) -4.17% announced receipt of funds following an exercise of options to the tune of $5.153m and a trading update with an optimistic outlook.

BOND CORNER

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ECONOMIC NEWS

  • Annualised shipments from WA’s Pilbara iron ore region fell by more than 100m tonnes in early February, according to Macquarie. The state had its wettest summer since 1900, according to the Bureau of Meteorology. UBS raised its average price forecast for 2017 to $US71 a tonne from $US56 a ton, citing strong demand and high steel margins.

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  • The size of the average loan for first home buyers increased by 1.3% over the December quarter and 1.5% over the year to $323,633, an Adelaide Bank/REIA report said.
  • NSW remained the least affordable state, with monthly repayments rising 1.5% from September to 37% as the average loan rose 4.6% to $472,380. Rental affordability also worsened to 28.6% from 28.1%.

ASIAN NEWS

  • Interesting numbers out of China today showing imports rose a big 44.7% whilst exports were up a more modest 4.2%. The results were skewed as stocking up for the Chinese New Year holiday distorted the numbers.
  • Chinese telecom company ZTE will pay around USW$1.2bn for violating US sanctions over deals with North Korea and Iran.

EUROPE AND US

  • Is Snap the unicorn that broke the tech market? Two days after listing it is down another 10% following big falls the day after listing at a high of US$28.84. Now trading at US$21.44. Go Pro topped out at US$87 and are now trading at US$8.
  • UK Budget tonight. The OECD has recently been upgrading UK growth forecasts to 1.6% up from 1.2% it predicted back in November. The Chancellor Hammond is widely expected to announce tax rises and spending cuts in the budget.

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And finally………….

 

A pirate walked into a bar and the bartender said, “Hey, I haven’t seen
you in a while. What happened? You look terrible.”

“What do you mean?” said the pirate, “I feel fine.”

“What about the wooden leg? You didn’t have that before.”

“Well, we were in a battle and I got hit with a cannon ball, but I’m
fine now”

“Well, OK, but what about that hook? What happened to your hand?”

“We were in another battle. I boarded a ship and got into a sword fight.
My hand was cut off. I got fitted with a hook. I’m fine, really.”

“What about that eye patch?”

“Oh, one day we were at sea, and a flock of birds flew over. I looked up
and one of them shit in my eye.”

“You’re kidding,” said the bartender, “you couldn’t lose an eye just
from bird shit.”

“It was my first day with the hook.”

 

Clarence

XXX

mt_tryforfree

NT Markets

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