Today’s Headlines

• ASX 200 drifts off 8 points to 6187 in mixed quiet trade.
• High 6196 Low 6168. Range bound.
• Tariffs kicked in this afternoon.
• BHP rallies but resources generally under pressure.
• Gold producers ease despite some M&A activity.
• Banks stable except CBA with energy and telcos better.
• AUD eases to 72.63c.
• Bitcoin better at US$6680.
• Aussie Gold weaker at $1646.
• US futures slips 57 as tariffs begin.
• Asian markets closed today.

STOCK STUFF

• SCO +15.24% takeover bid from Affinity PE.
• LYC -18.33% response to press speculation on inquiry into LAMP.
• BGA +2.67% change of director’s interest.
• APT +2.59% SPP oversubscribed.
• FMG -3.29% resources off the boil.
• RIO -1.22% last day for off market buy back registration.
• A2M -3.81% new CEO sells out.
• SGM -11.65% profit downgrade.
• RAP -12.24% change in substantial holding.
• BYE +4.48% Bivouac Peak drilling update.
• PPS +5.50% marching higher.
• WHA -1.46% construction work begins.
• Speculative stock of the day: Eden Innovations (EDE) +37.14% after announcing its first federally funded project for its concrete product to commence in the US.
• Biggest risers – SCO, PLS, CUV, ASL, MAH and PNI.
• Biggest fallers – LYC, SGM, SBM, RRL, EVN and UPD.

TODAY

• South32 (S32) – 1.28% Diamond drilling has commenced at the Jimberlana Nickel Project in Western Australia under the Strategic Alliance Agreement with AusQuest Limited (AQD). The new program will take up to two weeks to complete, involves two holes with a total size of 700m and is planned to test electromagnetic (EM) targets located within the Jimberlana Dyke complex.
• Sims Metal Management (SGM) – 11.66% The company has provided a trading update. 1Q19 underlying EBIT of $58m-$63m is expected, a 29%-40% increase on last years. The income from the company’s 50% joint venture, SA Recycling, is projected to be $10m-$15m lower than in 4Q FY18 as intake volumes and Zorba sales have been lower than expected. Further updates will be provided at the company’s 2018 AGM on November 8^th 2018.
• Scottish Pacific Group (SCO) +15.24% Have entered a Scheme Implementation Agreement with Affinity Equity Partners. The scheme proposes a 100% acquisition of SCO at a cash price of $4.40 per share (a 27.8% premium on SCO’s 1-month volume weighted average price). The company’s Directors have unanimously recommended that shareholders vote in favour of the scheme, subject to no better offer emerging and an independent expert’s report confirming that the Scheme is in the best interests of the shareholders. A Scheme booklet, including the independent report, is expected to be issued to shareholders by early November.
• TPG (TPM) +1.34% ACCC to decide on the merger with Vodafone on December 13th.
• Clean TeQ (CLQ) –4.04% Will form a newly incorporated joint venture with Ionic Industries Pty Ltd to further develop and commercialise the graphene-oxide based water filtration membrane which the company is currently progressing towards developing. The joint venture will be 75% owned by Clean Teq and 25% by Ionic.
• Regis Resources (RRL) –6.76% Have put forward a 100% takeover proposal to Capricorn Metals (CMM) +50.85%. The offer has been set at 11.4c per share, a premium of around 93% to the last closing share price of 5.9c. Despite unanimous support from the Capricorn Board, no transaction can be put to the shareholders for consideration until all the conditions of the offer have been satisfied and there is no guarantee that an agreement will be reached. The Capricorn Board will update its shareholders if any material developments arise in compliance with continuous disclosure obligations.
• Lynas (LYC) – 18.33%The company has responded to local Malaysian press speculation about the possibility of a review and inquiry into its LAMP project in Malaysia. The company has complied with all envornmental requirements and licences but the fear is a anti-LAMP campaigner may chair any inquiry.

ECONOMIC NEWS

• Nothing today.

BOND MARKETS

ASIAN MARKET NEWS

• Trade war kicked off today. China has issued a white paper on trade frictions.
• Chinese holiday and Japan out too.
• The Chinese equivalent of the Fed’s Beige Book, a survey by CBB has found that weakness in China’s goods-producing sector in the third quarter of this year was offset by strength on the services side of the economy. Producers in China are already under stress even ahead of implementation of U.S. tariffs, as indicated by an explosion in corporate borrowing that isn’t being captured by official government statistics.

EUROPEAN AND US HEADLINES

• FTSE expected to open down around 28, DAX down 39 and CAC down 50.
• A second woman has come forward to accuse Brett Kavanaugh of sexual misconduct.
• UK PM May is in all sorts as the majority of the cabinet now supposedly support a ‘Canada’ style Brexit deal. Labour’s Corbyn backs a second referendum.
• The Sky bidding war has finished with Comcast the winner with a GBP30bn bid or US$17.28 a share. Hedge funds hold around 30% of Sky, whilst Fox owns around 39% and has not clarified its position on a sale.
• 41% of people in the UK do not think they will ever buy a property of their own, according to an ING study. Pretty similar to local buyers.

And finally……………

Teacher: “If I gave you 2 cats and another 2 cats and another 2, how many would you have?”
Johnny: “Seven.”
Teacher: “No, listen carefully… If I gave you two cats, and another two cats and another two, how many would you have?”
Johnny: “Seven.”
Teacher: “Let me put it to you differently. If I gave you two apples, and another two apples and another two, how many would you have?”
Johnny: “Six.”
Teacher: “Good. Now if I gave you two cats, and another two cats and another two, how many would you have?”
Johnny: “Seven!”
Teacher: “Johnny, where in the heck do you get seven from?!”
Johnny: “Because I’ve already got a bloody cat!”

Clarence

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