- ASX 200 follows late US sell-off. Down 43 pts to 5973
- High 6006 Low 5957. Ex divs not helping.
- Across the board losses with financial and resources leading.
- Telstra continues to fall.
- REITs hold up on defensive bias.
- AUD Falls slightly in capex numbers to 77.33c
- Bitcoin continues to climb US$10335
- US futures down 41 after Wednesday’s late sell off.
- Asian markets mixed with Japan -1.46% and China CSI up 0.90%
Movers and Shakers
- CLQ +15.88% broker upgrades
- MSB +9.27% positive broker comments.
- BWX +3.82% bouncing back.
- PPH +3.42% broker upgrades
- SPL +3.46% positive bio tech sentiment.
- ISX +12.90% write up on livewire.
- YAL +3.23% good profit report.
- ORE -6.12% GXY -4.86% lithium turns negative.
- MLX -5.11% copper price falls.
- ABC +0.46% Barro creeps up share register.
- DMP -1.04% continuing press speculation on margin loans.
- HVN -2.99% brokers cool as milk sours.
- BIN +1.95% broker upgrades.
- MGC -1.78% facing ACCC issues.
- ORI -3.49% profit downgrade
- ALU -2.92% downgraded by Bell Potter.
- RHC -1.36% downgraded.
- BVS +1.38% Ironbridge Capital sells stake.
- Speculative stock of the day: Taruga Gold (TAR) +176.00% after the acquisition of a high-grade cobalt-copper project in the Congo. Looks pretty overdone considering it is the DRC. The company is raising $1.35m through a placement of 13.5m shares at 10c. Seems an excessive price rise for a small project acquisition.
- Biggest risers – CLQ, MSB, WBA, DCN and GSC.
- Biggest fallers – ORE, MLX, GMA, EWC and GXY.
- Mayne Pharma (MYX) – unchanged- Releases the first generic extended release form of Ritalin in the US in a 10mg dose. The product is used to treat attention deficit hyperactivity disorder, and compliments the existing product range in 20mg, 30mg, 40mg and 60mg dose strengths. The company says US brand sales of Ritalin were approximately US$20m for the 12 months ending 2017
- Murray Goulburn (MGC) -1.78% the ACCC says its has concerns about the Saputo deal. Its sole concern is in relation to its Koroit dairy plant and the affect it will have on competition for farmers’ milk in south-west Victoria and south-east Victoria. Anticipated date for the regulator’s final decision is 29 March.
- Orica (ORI) -3.49% The company announced a profit downgrade this morning. ORI has blamed unplanned maintenance at Yarwun and Kooragang Island for a $17m hit. The company is also being impacted by extreme weather in North America. EBIT performance will be skewed to the second half. The company has also flagged a $300m provision in its Minova business.
- The trend volume estimate for total new capital expenditure rose by 0.8% in the December quarter 2017 while the seasonally adjusted estimate fell by 0.2%.
- The trend volume estimate for buildings and structures fell by 0.2% in the December quarter 2017 while the seasonally adjusted estimate fell by 2.1%.
- The trend volume estimate for equipment, plant and machinery rose by 2.1% in the December quarter 2017 while the seasonally adjusted estimate rose by 2.2%.
The banking regulator has signalled it could ditch its 10% cap on lending to property investors as the measure is “probably reaching the end of its useful life”. Wayne Byres said the speed limit, introduced in 2014, might be becoming “redundant” as bank lending standards had improved, while credit growth had dropped sharply.
Sydney prices fell 0.6% and Melbourne and Brisbane prices fell 0.1% each, in Corelogic’s hedonic home value index for February. Across capital cities, prices fell 0.1%.
BOND MARKET UPDATE
ASIAN MARKETS NEWS
- The Caixin-Markit purchasing managers’ index, which focuses on smaller and private businesses, edged up to 51.6 in February from 51.5 in January.
- In a two-week session starting Monday, China’s parliament is expected to enact sweeping legislative changes that would allow President Xi to rule indefinitely and give him greater control over the levers of money and power. Other items on the agenda include a plan to radically overhaul the finance and insurance industry.
- Tencent Music Entertainment, the streaming unit due to be spun off by the Chinese tech titan later this year, has been valued at US$12.3bn based its reciprocal share swap with global peer Spotify.
- India is now officially the world’s fastest growing major economy at 7.2%
EUROPE AND US MORNING HEADLINES
- Trump looks like he will impose strict steel and aluminium tariffs. The President told aides he wants to announce tariffs of 25% on steel and 10% on aluminum from all countries. Not good for RIO or BSL.
- Walmart has said it will end sales of guns and ammunition to people under 21 as calls for tougher gun controls continue in the wake of a Florida school shooting.
- Hope did not spring eternal as Hicks quits as White House Communication Chief.
- Getting messy in the UK as PM May attacks the Brexit draft as a threat to the UK. Northern Ireland emerging as a critical issue.
- Italian elections this weekend.
- According to one economist the signs of global stress are flashing amber. The Libor rate (London Interbank Offered Rate) has spiked to a 10-year high. Why is this important? Well a third of all; US business loans are linked to Libor. Theory is the US can stand higher rates but the rest of the world? Maybe not so.
Joe loved golf, but his eyesight had gotten so bad that he couldn’t find his ball once he’d hit it. He consulted with his wife, and she recommended that Joe bring along her uncle Ted.
Joe said, “But Ted is 80 years old and half senile!”
His wife replied, “Yes, but his eyesight is incredible.”
Joe finally agreed and took Ted along. He teed off and could feel that he had hit it solidly.
He asked Ted, “Do you see it?”
Ted nodded his head and said, “Boy, that was a beautiful shot!”
Joe excitedly asked, “Well, where did it land?!”
Ted said, “Hmmm. I forget.
A little boy goes to his dad and asks, “What is politics?”
The dad says, “Well son, let me try to explain it this way: I’m the breadwinner of the family, so let’s call me capitalism.
Your mother, she’s the administrator of the money, so we’ll call her the government. We’re here to take care of your needs, so we’ll call you the people.
The nanny, we’ll consider her the working class.
And your baby brother, we’ll call him the future. Now, think about that and see if that makes sense.”
The little boy goes off to bed thinking about what dad had said.
Later that night, he hears his baby brother crying, so he gets up to check on him. He finds that the baby has soiled his diaper. The little boy goes to his parents’ room and finds his mother sound asleep. Not wanting to wake her, he goes to the nanny’s room.
Finding the door locked, he peeks in the keyhole and sees his father in bed with the nanny. He gives up and goes back to bed.
The next morning, the little boy says to his father, “Dad, I think I understand the concept of politics now.” The father says, “Good son, tell me in your own words what you think politics is all about.” The little boy replies, “Well, while capitalism is screwing the working class, the government is sound asleep, the people are being ignored and the future is in deep poo.”