The Bulls are Back in Town!
- ASX 200 gains 53 to 6090 as bulls grab the horns.
- High 6094 Low 6043. Good volumes.
- AUD staying strong at 80.76c post CPI.
- Banks and miners strong. Risk appetite back on.
- Energy stocks join the party. TLS misses out.
- AUD slips to 80.48c as rate rise hopes fall
- Bitcoin firms to US$9959
- US futures up 66
- Asian markets mixed with CSI 300 down 1.10% and Japan up 1.12 %.
Movers and Shakers
- BHP +1.521.45% talks up divestment plans for US business.
- XRO +% on news National Bank will allow payments through XRO.
- CBA +% responds to Prudential Panel inquiry
- ASL +5.75% letter of intent for Wodinga project
- IVC +3.28% Lazarus rising.
- KGN +8.25% marches higher following Ticky interview
- LYC -3.70% misses rally.
- TGR -6.36% heavy trade. Bad news ahead?
- API -1.33% resumes downtrend.
- VAH -3.70% broker downgrade.
- YOJ -8.16% falls on quarterly.
- WHA +10.62% first order from Macau.
- BRN +5.00% Luis Coello Director of Sales for EMEA.
- MSB +4.85% buyers return.
- BIG -2.19% new appointment to board.
- MDC -6.25% falls to recent placement price despite good news.
- Speculative stock of the day: Knosys (KNO) +61.62% an investor presentation has got the stock fired up again after the initial flurry of activity on the $6m Singtel deal announced the other day.
- Biggest risers – XRO, KGN, GUD, ASL, OMH and BPT
- Biggest fallers – TGR, LYC, VAH, AHY, RFF and VRL
- The AFR reports that there is a cloud over lithium production at Greenbushes in WA with tantalum being the issue impacting the doubling of capacity to 1.34m tonnes. Talison’s owners, Chinese company Tianqi and US-based Albemarle, are counting on the $320m lithium mine expansion as they push ahead with building standalone lithium hydroxide plant in WA.
- Godfreys (GFY) -% the vacuum cleaner retailer said sales were weak during the Christmas period, and warned impairments could lead to a half year loss of around $59m.
- The market currently implies around a 50-50 chance of a hike from the Reserve Bank of Australia by October and is not fully priced for a move to 1.75% until early next year.
- UBS has upgraded the growth outlook as real GDP accelerates to around a 4% annual rate in the fourth quarter of last year. Australian growth has been revised higher to 2.8% in 2018 and 2019 from 2.7%, snapping a downgrade cycle.
- Prices in Sydney and Melbourne fell 0.9% and 0.2% respectively in January mirroring the same decline Corelogic’s latest Hedonic Home Value Index shows. Sydney house prices have now fallen 3.1%.
- The Future fund reported an annual return for 2017 of 8.8% lifting its assets to $139bn.In the final quarter of 2018, the Future Fund’s exposure to listed equities increased from 30 to 33% while the absolute exposure increased by $5.2bn to $45.5bn.
- The number of dwellings approved fell 1.7% in December 2017. In seasonally adjusted terms, dwelling approvals decreased by 20.0%. in December, driven by a fall in private dwellings excluding houses (39.2%), while private house approvals rose 1.0%. The numbers are veryt volatile and economists were going for – 8%.
- More from the ABS – The Import Price Index rose 2.0% in the December quarter 2017. This follows a fall in the September quarter 2017 of 1.6%. The rise was driven by higher prices paid for Petroleum, petroleum products and related materials (+14.0%), reflecting tightening worldwide supply due to global production restrictions and capacity constraints. The Export Price Index rose 2.8% in the December quarter 2017. This follows a fall in the September quarter 2017 of 3.0%. Prices received for many of Australia’s mineral fuel commodities rose in the December quarter 2017. Coal, coke and briquettes rose 9.0% driven by demand from China for higher quality coal and supply restrictions. Petroleum, petroleum products and related materials rose 19.7% reflecting tightening worldwide supply due to global production restrictions and capacity constraints.
- The Federal Government has unveiled restrictions on sales to international buyers on power and agricultural companies. The government will consider the cumulative level of ownership in a sector, the need for diversity and the asset’s critical importance.
BOND MARKET UPDATE
- Chinese stocks have worst week since 2016.
- The Caixin/Markit manufacturing Purchasing Managers’ Index for January came in at 51.5. Expectations were around 51.3. The official manufacturing PMI for the month missed expectations, coming in at 51.3.
- The official non-manufacturing PMI released on Wednesday expanded to 55.3 in January from 55 in December.
- Bitcoin has lost around US$44bn of its value in January.
EUROPE AND US MORNING HEADLINES
- Amazon is now the most valuable brand in the world knocking Google off the top spot. Apple is in second place followed by the search engine.
- Alan Greenspan is forever blowing bubbles or at least at 91 he still sees them, both in bonds and equities.
- Yellen bows out as inflation outlook strengthens.
- Facebook says users spend less time browsing by a huge 50m hours a day as the company announced a significant decline in usage of its service and what may be the first-ever drop in daily users in the United States.
- Theresa May has promised that freedom of movement for EU citizens coming to Britain will end on Brexit day in March 2019. Caution! Hard Brexit ahead.
- Coca-Cola to close two UK sites, cutting nearly 300 jobs.
A male driver is pulled over by a cop and the following conversation takes place:
Man: What’s the problem officer?
Cop: You were going at least 75 in a 55 zone.
Man: No sir, I was going 65.
Wife: Oh Harry. You were going 80. (Man gives his wife a dirty look.)
Cop: I’m also going to give you a ticket for your broken tail light.
Man: Broken tail light? I didn’t know about a broken tail light! Wife: Oh Harry, you’ve known about that tail light for weeks. (Man gives his wife a dirty look.)
Cop: I’m also going to give you a citation for not wearing your seat belt.
Man: Oh, I just took it off when you were walking up to the car.
Wife: Oh Harry, you never wear your seat belt.
Man: Shut your mouth, woman!
Cop: Ma’am, does your husband always talk to you this way?
Wife: No, only when he’s drunk.
Finding one of her students making faces at others on the playground, Ms. Smith stopped to gently reprimand the child. Smiling sweetly, the Sunday school teacher said, “Johnny, when I was a little girl, I was told if that I made ugly faces, it would freeze and I would stay like that.” Little Johnny looked up and replied, “Well, Ms Smith, you can’t say you weren’t warned.”