ASX 200 finishes down 13 to 6298 on a late rally as bank ex-dividends weigh. Dow futures slipped 265 points on latest Trump tweet. Trade wars rhetoric seems to be ramping up but has failed to dent the local market that much. Narrow trade range with thin volumes as we await the election Saturday. Financials were the weak spot by far.  ANZ down 3.9% and MQG down 3.6% on ex-dividends, these have taken around 12 points off the index. In other banking news, CBA fell 2.5% on its 3Q update which showed another $714m in remediation costs hurting and no sign of this being the end of it. Defensive sectors in demand on lower interest rate hopes, GMG up 1.4% and TCL up 1.8% to a near all-time high. TLS too in demand on domestic focus, up 1.2%. In corporate news, RWC down 15.6% after downgrading its earnings due to warmer weather and slowing local demand. LLC up 8.7% following media speculation that Mitsui is looking at a tilt at the former blue chip developer. ECX fell 4.7% on a $130m write down and a new CEO. Miners were mixed with BHP up 0.3% and RIO up 0.8% and S32 up 1.5% showing good gains. Energy stocks fought back to close unchanged on Iranian tensions. AUD slightly weaker at 69.75c. Asian markets weaker as Yuan dropped and trade wars threatened to escalate.

Todays Highlights

• ASX 200 down 13 to 6298. Closes on highs.
• High 6298 Low 6278. Narrow range. Lower volume.
• Financials under pressure as CBA disappoints.
• Defensives find takers. Healthcare and utilities strong.
• Miners stage comeback as BHP turns positive.
• RWC and ECX downgrade.`
• AUD weaker at 69.75c
• Aussie Gold steady at $1841.
• Bitcoin up again to $7122.
• US futures down 265. Confused? Yup.
• Asian markets weaker with Japan down 0.88% and China down 1.56%. HK closed.

STOCKS

• LLC +8.71% takeover speculation.
• TCL +1.77% bond proxies up. All time high.
• CSL +1.42% defensive buying.
• RWC -15.62% plumbing new depths.
• BUB -13.07% momentum stalls on trade wars.
• 360 -3.95% honeymoon over.
• SIQ -5.32% broker downgrade.
• ECX -4.69% company downgrade.
• KGN +3.10% tech stocks firm.
• TNE +3.17% broker upgrade.
• AWC +2.67% resource buying following recent presentation.
• FXL +5.26% change in substantial shareholding.
• FLC +5.68% signs new $10m in Brazil.
• GXY +1.55% Mt Cattlin update.
• APA -0.20% executive changes.
• WGN +8.06% bargain hunting.
• WHA -7.01% signs debt sheet for the acquisition of B&P.
• ABC -1.93% not as easy as after a 4-year low.
• AST -1.08% full year results.
• Speculative stock of the Day: Orthocell (OCC) +% Huge volume and a big day. Have written about this one last week as a speculative buy.
• Biggest Risers: LLC, PME, FXL, ASB, AX1, and HSN
• Biggest Falls: RWC, BUB, SIQ, TLT, 360, REH and SWM.

TODAY

• Ansell (ANN) –2.07% To invest $32m over the next two years to grow its Lat Karbang facility in Thailand. The expansion will lift plant capacity by 30%.
• Reliance Worldwide (RWC) –15.62% Cuts FY19 EBITDA guidance by around 7%, now forecast to be between $260m and $270m. The downgrade is due to a no ‘freezing event’ scenario in the US, plumbing supplies are helped by freezing pipes leading to replacement and upgrades. RWC’s Asia Pacific segment is also underperforming on the slowing residential construction market.
• APA Group (APA) -0.20% Appoints Rob Wheals as CEO and MD effective July 6, he will take over from Mick McCormack who will step down and retire on July 5.
• AusNet (AST) –1.08% Full year results; net profit after tax came in at $253.9m, below consensus of $259.4m. EBITDA met expectations at $1.13bn, and revenue beat at $1.86bn. A final dividend of 4.68c per share was declared.
• Eclipx (ECX) –4.69% MD and CEO Doc Klotz to step down, Julian Russell to take over. ECX is also taking a non-cash impairment charge of between $110m-$130m in its interim results, relating to the underperformance of Graysonline and Right2Drive.
• AirXpanders (AXP) – Doubtful it will achieve net revenues of between $11.5-14m for FY19. AXP said it can’t provide revised guidance at this stage as it works through its current restructuring and explores financial and strategic alternatives.

ECONOMIC NEWS

• Home loan approvals for March are down 2.8%, missing estimates of a 0.5% fall.
• Investment home loan values fell 2.7%. Owner occupier loan values fell 3.5%.

BOND MARKETS

• 2-Year bond yields down 1bps at 1.29%
• 5-Year yields down 2bps to 1.32%
• 10-Year yields down 1bps to 1.71%

ASIAN NEWS

• Hong Kong closed today.
• China says likely to bump into Trump at G20 in Tokyo in June.

EUROPEAN AND US NEWS

• Saudi Arabia has said two tankers have come under attack in the Gulf over the weekend.
• Uber has listed. First day trading was lacklustre. Quick look at some of the recent tech listings and performance.

• Greek government has narrowly won a confidence vote.
• Never good to open two fronts in a war but seems Trump has not read his history. Looking increasingly like his next target in the tariff wars is Europe and especially European car manufacturers.
• Pressure is growing on PM May in the UK to quit or at least name the date as EU elections loom and Nigel Farage looks to be in a winning position well ahead in the polls.
• Manchester City clenches the league. Liverpool misses out again. 30 years now.
• Unilever is mulling a US$1bn bid for a US skincare company Drunk Elephant.

And finally…

Best joke of the year…thanks Birkers….

 

Clarence

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