ASX 200 finished on a strong note after a solid week with the 6000 level beckoning. Afterpay (APT) the highlight today despite a ‘typo’ in the announcement on growth. Royal Commission kicks off into aged care prompting a sell-off and resources continue mixed after RIO production report. Financials and the bank power the market rebound this week with energy stocks also helping. US futures remain positive helping sentiment.

Todays Highlights

• ASX 200 up 30 to 5880
• High 5888 Low 5858. Narrow range.
• ASX 200 up 102 points (1.8%) for the week.
• Broad-based gains again with financials in focus.
• Resources grind higher after RIO quarterly.
• Afterpay stars on business update.
• Energy shares in demand on stronger oil price.
• AUD steady firms to 71.93c
• Bitcoin firmer at $3630
• Aussie Gold slips to $1796
• US futures up 89
• Asian markets stronger with Japan up 1.34% and China up 1.26%

STOCKS IN FOCUS

• APT +12.98% hits the afterburners on business update. Typo helped.
• AGL +0.97% toxic coal waste product pulled off-market.
• SYR +2.87% buyers return.
• SGF -1.38% broker downgrade.
• ORE +4.62% management changes
• HSO +4.37% Friday deadline for Brookfield due diligence.
• IVC +4.09% heatwave helping numbers.
• BPT +3.31% ceasing to be a substantial shareholder.
• EHE -4.91% AOG -1.57% and REG -2.14% Royal Commission starts.
• TWE +4.34% bargain hunters. Oversold.
• PNV +2.54% increasing production and Malaysian approvals.
• Speculative stock of the day: Nothing on any volume today. Spicers (SRS) +26.42% after it entered into a scheme of arrangement with Kokusai Paper at 7c.
• Biggest Risers – APT, SFR, MOE, MSB, CCP and SGM
• Biggest Fallers – SDF, EHE, SYD, HLS, LYC and ALG

TODAY

• Afterpay (APT) +12.98% trading update. Underlying first-half sales up 240% on year to $2.2bn. More than 3.1m active customers in the last 12 months, growing at an average of approximately 7,500 new customers per day over Q2 FY19. Late fees as a percentage of total income have dropped below 20% in the first half of FY19.
• Rio Tinto (RIO) +0.31% FY production numbers. Pilbara iron ore shipments were in line with consensus at 338.2Mt. RIO expects a further lift in sales in 2019, estimating shipments from its Pilbara mines of between 338 and 350 million tons. Mined copper beat guidance of 597.6kt coming in at 633.5kt.
• Woodside (WPL) +0.44% The Australian has reported that WPL is “overwhelmingly likely” to offload its stake in its Scarborough and Pluto Projects due to strong interest.
• Sydney Airports (SYD) -2.88% December traffic numbers. Domestic passengers down 2.6% year on year to 2,318,000 passengers. International passengers up 3.7% year on year to 1,553,000.
• Commonwealth Bank (CBA) +0.68% will take a $169m after-tax non-cash hit from costs associated with the sales of wealth/insurance businesses & AUD depreciation.

ECONOMIC NEWS

The HIA New Home Sales Report shows detached house sales fell by 6.7% in the final month of 2018. Sales during the final quarter of 2018 were 14.9% lower than last year. New South Wales was the only state where sales did not decline during the month (up by 10.0%). Elsewhere sales declined by 11.8% in Victoria, 9.2% in Queensland, 4.0% in South Australia and 9.2% in WA

• Short-term visitor arrivals during November 2018 (779,900 movements) remained steady at 0.0% when compared with October 2018 (779,800 movements).
• Short-term resident returns during November 2018 (936,600 movements) increased 0.3% when compared with October 2018 (934,200 movements).

BOND MARKETS

• 2-Year bonds up 3bps to yield 1.84%
• 5-Year yields up 3bps to yield 1.96%
• 10-Year yields up 3bps with yield 2.31%

ASIAN MARKETS

• China revises GDP growth to 6.8% from 6.9%. Not that anyone really believes either of those two numbers.
• Chinese ambassador to Canada has warned of repercussions from Huawei ban fallout.
• Japanese consumer inflation falls to a 7-month low. Price growth is now below 1% for 2018.

EUROPEAN AND US HEADLINES

• Atlassian had a huge quarter and surged 10% after hours on its revenue result now pushing through US$1bn annually. Shame not listed here.
• Nancy Pelosi had her overseas junket canned as Trump cancels Davos appearance.
• Brexit? On or off? Who knows but uncertainty remains as Corbyn refuses to join May to solve crisis. Mass resignations possible unless May stops ‘No Deal’ Brexit (that’s the Hard one)
• Germany looking to ban 5G involvement from Huawei.
• One of the biggest losers of any Hard Brexit would be Germany. BMW sales would be affected.
• Prince Philip escapes rolled Range Rover smash. Not sure why he was driving at 97. Chauffeur had the day off?

And finally….

The zookeeper said it was bread in captivity!

She says, “No, first a Gibson! Then a Fender!”

… they’re bad with fractions!

Clarence

XXX