The ASX 200 closed near its highs up 35 points at 5891 on strong volume for a Monday. Early weakness following the Boral (BLD) downgrade turned as banks saw buyers cover shorts ahead of the Royal Commission release after hours. Resources saw profit taking with Chinese markets closed for new year holidays. Energy stocks bucked the trend in resources with Telstra (TLS) showing good gains after reports on potential write-downs on the NBN carrying value. A fall in ANZ jobs ads and a large drop in building approvals pointing the way to a weakening economy. RBA meeting tomorrow and RC fallout.

Todays Highlights

• ASX 200 up 28 points to 5891.
• High 5899 Low 5849.
• BLD downgrade weighs early before banks show recovery.
• TLS lifts on potential NBN write-offs.
• Royal Commission takes focus banks rise on short covering ahead of inquiry..
• Resources slip on consolidation.
• Energy shares remain firm.
• AUD steady at 72.34c
• Bitcoin rises to US$3414
• Aussie Gold falls to $1815
• US futures up 44.
• Asian markets slightly higher with Japan up 0.53% and China closed.

STOCKS IN FOCUS

• SYR +4.17% shorts cover.
• DMP +1.98% quietly rising pre-results.
• ASB +7.50% profit upgrade.
• MPL +3.86% overseas buyer pounces.
• CGF +3.33% short covering rally.
• IFL -4.50% late FUMA on Friday.
• AMP -1.34% wobbles ahead of RC.
• CGC -2.03% berries still cheap.
• SIQ -2.26% sell-off continues as ECX rises.
• AC8 -13.93% quarterly cash flow report last week.
• CAT -5.56% broker downgrade.
• BID +7.14% investor day.
• VCX -0.39% CFO resigns.
• WHA +1.57% media coverage.
• RMD -0.99% brokers cool on outlook.
• AMP -1.34% record low ahead of RC.
• TCL -0.57% infrastructure stocks sold off.
• The speculative stock of the day: Otto Energy (OEL) +42.86% commercial discovery at Green#1 at the Lightning project in the US.
• Biggest Risers – AHY, ASB, WSA, SDF, NAN and MPL
• Biggest Fallers – BLD, IFL, DHG, PLS, XRO and GOR

TODAY

• ASIC has told Commonwealth Bank (CBA) +0.77% Financial Planning to stop charging or receiving ongoing service fees and not to enter into any ongoing service arrangements with customers saying they have failed to comply with an enforceable undertaking.
• Boral (BLD) -7.89% profit warning, expecting 1H19 NPAT will be $200m, less than the $228.5m anticipated. The company is expecting 1H19 EBITDA of around $485m, missing expectations of $519.9m. FY19 EBITDA is expected to exceed that of FY18, with a stronger 2H19 forecast, while slightly lower profits are expected from USG Boral.
• IOOF (IFL) -4.50% has seen a $295m outflow of funds in the December quarter. The company announced late on Friday night that advice net flows included $657m of outflows from its BT brand. The company seems to have had more luck in attracting money to its platform business at $403m up from $308m in the same period last year.
• Austal (ASB) +7.50% have upped FY revenue guidance from $1.3-1.4bn to 1.9bn. The company have also given 1H EBIT guidance of $39-41m, above estimates of $36.1m, and expect a FY US shipbuilding margin of 7-8%.

ECONOMIC DATA

• ANZ jobs ads fell 1.7% in January, missing forecasts of a 0.8% rise.
• Building permits fell a total of 8.4% in December, an unexpected drop considering a 3.2% rise was forecast. Private sector houses dropped 2.2% and apartments fell 18.8%.

• National Australia Bank’s online retail sales index recorded a 1.4%month-on-month contraction in December, down from a 2.9% increase in November. Official retail sales data for December is due tomorrow.

BOND MARKETS

• 2-Year bond yields up 1bps to 1.78%
• 5-Year yields down 2bps to 1.85%
• 10-Year yields down 2bps to 2.22%

ASIAN NEWS

• China closed for Lunar New Year. The year of the Pig.
• Sony shares fell heavily in Japan after cutting its sales outlook on slowing smartphones and cameras sales.

EUROPEAN AND US HEADLINES

• Goldman Sachs has with held millions of dollars due to be paid to former chief executive Lloyd Blankfein and two other departed bankers pending the outcome of the 1MDB scandal.
• M&A activity continues with the US$90bn merger of Bristol-Myers Squibb and Celgene creating a $US1bn fee bonanza for Wall Street.
• New England Patriots win the Superbowl in the lowest scoring game in history.

And finally…………….

A bunch of blokes are in the changing room of a golf club. A mobile phone on a bench rings and a man engages the hands free speaker-function and began to talk. Everyone else in the room stops to listen.

BLOKE: Hello

WOMAN: Darling, it’s me. Are you at the club?

BLOKE: Yes

WOMAN: I am at the shopping centre and found this beautiful leather coat. It’s only $1,000. Is it OK if I buy it?

BLOKE: ³Sure,..go ahead if you like it that much.²

WOMAN: ³I also stopped by the Mercedes dealership and saw the new 2019models. I saw one I really liked.²

BLOKE: How much?

WOMAN: $170,000

BLOKE: OK, but for that price I want it with all the options.

WOMAN: Great! Oh, and one more thing  The house I wanted last year is back on the market. They¹re asking $1,950,000

BLOKE: Well, then go ahead and give them an offer of 1,900,000. They will probably take it. If not, we can go the extra 50 thousand. It really is a pretty good price.²

WOMAN: OK. I’ll see you later! I love you so much!!

BLOKE: ³Bye! I love you, too. The bloke hangs up.

The other blokes in the changing room are staring at him in astonishment, mouths agape.. He smiles and asks: ³Anyone know who this phone belongs to?

Clarence

XXXX