ASX 200 flip flops again to close 21 points higher at 5790 after early losses as the grind continues. Retails sold off with banks steady and miners finding support. Asian markets followed Wall Street higher with Japan up 0.43% and China up 1.34%. AUD steady at 75c and US Futures up 75.

STOCKS AND SECTORS

  • Banks and financials found their feet as David Gonski has joined the chorus of disapproval on the new tax. Gonski is the chairman of ANZ Bank (ANZ) +1.27%. The Big Four Basket rose slightly to $170.36. REITs did well again today with Westfield (WFD) +0.47% and Scentre Group (SCG) +0.47% leading the sector higher. Wealth managers suffered falls today after the BT Investment (BTT) -6.98% placement and some indigestion with Magellan Financial (MFG) -1.06% and Platinum Asset Management (PTM) -1.13%. Henderson Group (HGG) -0.24% had a great day with a 900% rise though not in real terms. If only. The company has recently merged with Janus Capital with a newly issued share and a 1:10 consolidation. The stock will delist in London and remain ASX and NYSE listed. HGGDA will be the code here.
  • Miners improved after the losses yesterday as bargain hunters stepped in. BHP +1.24%, RIO +1.44% and Fortescue Metals (FMG) +1.40%. Base metal stocks also did well as South 32 (S32) +3.41% and Oz Minerals (OZL) +0.97%. Independence Group (IGO) +2.70% finally found some buyers with gold stocks too pushing ahead. Evolution Mining (EVN) +1.65%, Saracen Minerals (SAR) +0.96% though Gold Road (GOR) -0.70%.
  • Energy stocks mixed ahead of the OPEC decision tonight. Woodside (WPL) +1.47%, Origin Energy (ORG) +1.91% though Santos (STO) -0.56% failed to inspire.
  • Industrials continue to find support Transurban (TCL) +0.99%, Qantas (QAN) +3.51%, Brambles (BXB) +1.62% together with ALS (ALQ) +0.91% drawing support on favourable broker comments after the results.
  • Telcos ran out of puff as the short squeeze in Vocus Group (VOC) +0.33% appears to have finished. Telstra (TLS) unchanged and Superloop (SLC) -0.76% down too.
  • Retail stocks were hit hard today with a new report from JP Morgan switching recommendations for JB Hi-Fi (JBH) -1.63%, Harvey Norman (HVN) -2.14% and Super Retail Group (SUL) -5.95%. Concerns include higher energy prices, higher interest rates and low wage growth. News of the demise of Topshop hurt the Myer (MYR) -4.37% share price as a 20% shareholder in the UK chain here.
  • Healthcare stocks mixed with pathology and radiology under pressure but Cochlear (COH) +0.82%, Fisher and Paykel (FPH) +0.93% though Nanosonics (NAN) -2.70% continuing to come off the boil.
  • Speculative stocks of the day: Panorama Synergy (PSY) +24.32% after achieving a major technical milestone with a functional bench-top Near Infra-Red spectrometer. Enough to get the punters excited. And a blast from the past, one we have talked about before, Alcidion (ALC) +25.42% after announcing a new NZ$1.6m contract worth MidCentral DHB.

CORPORATE NEWS

  • Ansell (ANN) +4.31% has sold its sexual wellness business for US$600m and will undertake a share buyback for up to 10% of the share capital. The condoms business was sold to a Chinese consortium and will result in a net profit of US$365m.
  • Aristocrat (ALL) +3.95% has announced a NPATA of $279.2m up 49% and has reaffirms guidance. Another good result from ALL. Although the guidance implies a lower second half this is affected by ongoing D&D investment. The company expects NPATA to grow between20%-30%.
  • Automotive Holdings Group (AHG) -10.36% updated guidance this morning with a forecast of between $87-$89m profit after tax in FY17. WA is proving a problem with new vehicle sales down 10% YTD. Tighter consumer credit conditions have affected sales. Weaker east coast sales, down 3%, have also weighed and not made up for issues in WA
  • Westpac Bank (WBC) +0.16% has confirmed that it has sold 60m BT Investment (BTT) -6.98% shares at 1075c a 10% discount to the 30 day VWAP. The bank still retains a 9.8% holding in escrow until the results are announced for FY18.
  • Mesoblast (MSB) -6.11% operational highlights announced today and cash reserves of US$69.1m
  • AMP +0.19% held an investor day today and has focused on leverage to strength in overseas financial markets and driving cost efficiency.
  • Ardent Leisure (AAD) +1.92% CEO Deborah Thomas has told a radio interview that the Dreamworld theme park could become an entertainment precinct on the same scale as Disneyland. The theme park occupies 35 hectares of a 60-hectare plot owned by Ardent.
  • Adelaide Brighton Cement (ABC) -1.06% suggests there is still three years of strong demand on the east coast. Infrastructure spending pipeline for federal and state governments was extremely strong and demand from that sector would offset any subsequent downturn in the residential housing sector. ABC expects profits in the first half of calendar 2017 to be below the same time last year, because of one-off restructuring costs and the relocation of a North Melbourne plant.

BOND CORNER

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ECONOMIC NEWS

  • The New Zealand government expects to post a bigger-than-forecast budget surplus in 2017 and plans to invest the extra cash in infrastructure.
  • The government predicted a $NZ1.62bn surplus in the year to June versus its prior forecast for a $NZ473m surplus. The better-than-expected result was a windfall from strong corporate tax intake and some reconstruction from the recent earthquake.

ASIAN NEWS

  • Moody’s has downgraded Hong Kong’s local and foreign currency issuer ratings following its downgrade of China yesterday.

EUROPE AND US

  • Trump does Europe in the next few days with climate change and NATO high on the agenda.
  • Rumours circulating that UK retailer Phil Green will rescue the Topshop Australia business being chairman of the group that owns the UK business. (Ex) Sir Phil was behind the spectacular implosion of BHS in the UK selling it for a pound.
  • If Canada is Australia especially given the economic similarities and the property bubble, could we see a similar thing here? Government intervention and a near collapse of Home Capital Group where the company had a run on deposits, has hurt prices substantially Listings have soared as owners get desperate to sell.

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And finally…..

Beeks is heading out into the world for a well earned break for three weeks. So can you all look after the market in my absence…don’t want to have to look at a screen for a while….

Will be back on air mid June in the meantime….

heaven

 

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Clarence

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NT Markets

Get a Global take on things at http://www.ntmarkets.com

 

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