A soft close to a big week. Royal Commission, iron ore prices, RBA backflips, all helped to push the ASX 200 up 3.5% for the week. Not a bad result at all. Today we fell 21 points in modest trade as we head into reporting season for real next week. Banks were flip-flopping from negative to positive with NAB under pressure due to executive changes, whilst CBA was in demand ahead of the dividend next week. 200c is highly attractive. Iron ore miners took a break as China re-opens next week. Energy stock suffered as crude fell and some funds flowed into defensives like TLS and GPT. In results, REA announced a write-down, coupled with some negative outlook comments. NWS showed some better numbers on digital subscriptions. The AUD remains under pressure on the change in tone from the RBA with the statement of monetary policy adding to its weakness.

Todays Highlights

• ASX 200 finishes the week with profit taking knocking 21 points off to 6072
• High 6095 Low 6054. Volume slows.
• ASX up 3.5% this week. Miners and big banks.
• Resources saw profit taking as did banks. CBA a standout.
• Iron ore plays catch up in Asia.
• Big Bank Basket at $153
• Energy stocks fall with oil price.
• REITs and defensives hold up.
• AUD smashed on SOMP to 70.75c
• Bitcoin falls to US$3355
• Aussie Gold rises to $1850
• US futures down 87.
• Asian markets slip with Japan down 2.03% and HK down 0.53% whilst China back next week.

STOCKS IN FOCUS

• JIN +4.24% keeps pushing higher.
• SPT -10.61% profit-taking
• BPT -9.67% results next week.
• DHG -6.33% catches REA downdraft.
• PPH -3.36% broker downgrades.
• WEB -4.27% selling resumes.
• CYB -5.05% profit taking on broker neutrality.
• TTT +6.28% new license agreements
• NCK +3.56% broker upgrades on results.
• ALL -2.77% overbought.
• JMS +3.77% metal price rises.
• TLS +1.57% some defensive buying.
• NWS +2.73% results boost. Kayo has 100k subscribers now.
• Speculative stock of the day: No standouts on low volume.
• Biggest Risers – MGX, JIN, JMS, NWL and NWS
• Biggest Fallers – BPT, DHG, CYB, REA, BIN and STO

TODAY

• REA -4.98% Underlying results look better than expected but the outlook is grim. Underlying profit up 20% with headline profit down 98%. Interim dividend of 55c. They talk about market conditions being unlikely to improve in short term thanks to the federal election as well as the New South Wales election. Revenue in the second half they say is slowing with listings down 11% in January and third quarter costs exceeding the revenue growth rate.

ECONOMIC DATA

• The RBA Statement of Monetary Policy (SOMP) has seen the RBA cut its GDP forecasts from 3.25% to 2.5%. Big change. It also slashed its inflation forecast to 1.25% from 2%. The reason is the property market slowdown is significant and adds to the uncertainty. To access the statement click here.

BOND MARKETS

• 2-Year bond yields down 4bps to 1.66%
• 5-Year yields down 7bps to 1.70%
• 10-Year yields down 9bps to 2.09%

ASIAN NEWS

• The king of Thailand’s sister is standing for election in a landmark for the country.
• Sony has announced a ¥100bn ($910m) share buyback in the wake of stock price falls.
• China back to work next week.

EUROPEAN AND US HEADLINES

• Germany has refused to ban Huawei.
• Kellyanne Conway has said that the UK will remain America’s closest ally whatever happens with the Brexit negotiations.
• The first sign of a rift between Germany and France over a gas pipeline project from Germany to Russia. Nord Stream 2, which will carry gas direct from Russia to Germany under the Baltic Sea, makes Europe even more dependent on Russian gas. Not a good thing according to the French. Nord Stream 2 is outside of the EU territory, but some are hoping to bring it under EU control.
• Brexit 48 days to go. Still a mess.

Finally…………..Thank Al…a classic for the weekend.

I was a very happy man. My wonderful Italian girlfriend and I had been dating for a year, and decided to get married.

There was only one little thing bothering me… it was her beautiful younger sister. My prospective sister in law was 22 and wore very tight mini skirts, and generally was bra less. She would regularly bend down when she was near me,and I always got more than a nice view. It had to be deliberate.because she never did it when she was near to anybody else.

One day her little sister called and asked me over to check wedding invitations. She was alone when I arrived,and she whispered to me that she had feelings and desires for me that she couldn’t overcome. She told me that she wanted me just once before I got married and committed my life to her sister. Well I was in total shock, and couldn’t say a word.

She said I’m going up stairs to my bedroom, and if you want one last wild fling, just come up and get me. I was stunned and frozen in shock as I watched her go upstairs.

I stood there for a moment,then turned and made a beeline straight for the front door. I opened the door, and headed straight towards my car.

Lo… and behold my entire future family was standing outside, all clapping. With tears in his eyes, my father in law put down his shotgun and hugged me and said, “we are very happy you passed our little test”. We couldn’t ask for a better man for our daughter. Welcome to the family.

And the Moral of this story is:
Always keep your condoms in your car!

 

And to Hans

JEWISH MISTRESS

A Jewish man and his wife are having dinner at a very fine restaurant when an absolutely stunning young woman comes over to their table, gives the husband a long open mouthed kiss and says to him, “I’ll see you later”.

“Who the hell was that?” says the wife.

“That was my mistress.” says the husband.

“I want a divorce!” says the wife, “This is the last straw! I’ve had enough.”

The husband says, “Alright! You’ll get your divorce, but just remember this: There will be no more winters in Barbados, no more summers in Tuscany, no more shopping trips to Paris, no more Mercedes in the garage, and no more Yacht Club. But the decision is yours!”

Just then a friend of the husband enters the restaurant with a gorgeous young woman on his arm.

“Who’s that woman with Moishe?” says the wife.

“That’s his mistress”, says the husband.

“Ours is much prettier.” says the wife.

Have a great weekend

Clarence

XXX