ASX 200 fell 6.5 points to 6666 as banks slipped again. Late rally helped but still down. Dow futures down 73. Another soggy day on the ASX as banks fell in response to new capital requirements from APRA. CBA down 0.4% and WBC down 0.5%. Insurers held firm though MQG dipped 0.6%. In the green were the big iron ore players again after rises in the iron ore price in Asia. BHP up 1.2% and FMG up 0.9%. Not huge moves but then again yesterday was muted too. CSL slipped 0.6% and TLS rose 0.8%. In corporate news, PLS bucked off weakness to close up 5.1% after a company and production update. ORA fell 1.21% after announcing a change in leadership. In bonds, yields were steady at 1.32% in the 10-years, whilst the AUD was a tad weaker following some consumer confidence numbers. Asia markets were in ‘pause’ mode ahead of Powell’s first outing this week. Japan down 0.22% and China down 0.31%.

 

Todays Highlights

• ASX 200 drops 6.5 to 6666 as banks weigh. Small rally into the close.
• High 6679 Low 6641. 6666 Coincidence?
• Banks led losses. Again. APRA move hurts.
• Iron ore back in fashion but muted.
• Healthcare down led by CSL.
• Consumer stocks rise.
• AUD slipping to 69.51c
• Aussie gold falls to $2005
• Bitcoin jumps to $12702.
• Dow futures down 73.
• Asian markets fell with Japan down 0.22% and China down 0.31%

LINKS TO THE WEBSITE CONTENT TODAY

• HENRY’S TAKE – A look at PNR following its fall plus what the drill result means for CVN. Good to see a positive M7T announcement today, now doubled since bought and the coming week of ‘Fedspeak’ to contemplate.
• IDEA OF THE DAY – In today’s arguably tasteless article called the “Death Sheet” you can work out how many hours you have left to live. Useful when doing your financial planning. If you can get your body and your bank balance to expire on the same day you can probably afford that Mustang after all.

 

STOCKS

• WBC -0.46% yet to compensate mortgage holders from 2017.
• RWC -4.67% US housing slow down.
• RFG -2.27% Nothing new says the company.
• M7T +6.98% new contract.
• PET +9.38% just keeps going. Funds need to buy the bigger it gets.
• PNV +3.10% another rise.
• BRG +5.98% broker upgrade.
• AVH +4.71% following PNV higher.
• PLS +5.10% production update cheers.
• MSB -3.23% some profit taking for day traders.
• WZR +10.71% signs of life.
• BRU -9.43% drilling update.
• FLC +6.45% one to watch.
• SWM -3.41% investors tuning out.
• SYR +8.67% short squeeze.
• Speculative stock of the Day: VRX Silica (VRX) +21.05% following an update from its Arrowsmith North Mineral project on an increase in its resource estimate by an outstanding 771 Mt @ 98% SiO2, an overall increase of 398%. Resource Estimate includes 248 Mt of Indicated Resource.
• Biggest Risers: PET, BRG, PLS, AVH, DMP and PSI.
• Biggest Falls: NGI, APT, NUF, RWC, NWH and OMH

TODAY

• Orora (ORA) –1.21% CEO Nigel Garrard to retire effective September 30, Brian Lowe to take over the role.
• APRA this morning has said it will require the major banks to lift Total Capital by three percentage points of RWA (risk-weighted assets) by 1 January 2024. Less than an earlier proposed 4% to 5% increase outlined in November laster year. APRA Deputy Chair John Lonsdale said the measures were an important step in minimising the risks to depositors and taxpayers should Australia experience a future bank failure. APRA estimates that the lift in capital requirements will only have a small impact on overall funding costs for the big banks – less than 5bps.
• Altura Mining (AJM) – Signs an offtake deal with a Chinese firm Shandong Ruifu for a 5-year term and will provide 35k tonnes p.a. of lithium concentrate, starting July 19. AJM also exited an existing offtake agreement with another Chinese firm.

 

ECONOMIC NEWS

• ANZ Roy Morgan Weekly Consumer Confidence Index fell -1.1% to 117.6 points.

• NAB Business survey: In June NAB’s survey measure of employment rebounded to +5 points from – 2 in April and is now about twice its long-run average after trending lower in recent months. The reading on capacity utilisation, saw a more positive outcome, increasing sharply in the month to 82.1 from May’s 80.9, with a number of industries seeing an improvement.
• UBS chief Matthew Grounds retires after 11 years at the helm.

BOND MARKETS

• 2-Year bond yields unchanged at 0.96%
• 5-Year yields unchanged at 1.00%
• 10-Year yields unchanged at 1.32%

ASIAN NEWS

• Carrie Lam (HK CEO) announces the extradition bill in HK is dead. Like the parrot.
• Japan is set to open talks with South Korea on its very own trade war over technology sales.
• DouYu International, the Tencent-backed game-streaming company, has filed to raise up to US$944m in its IPO on the Nasdaq stock exchange
• US approves US$2bn arms sale to Taiwan. Won’t help the situation.

EUROPEAN AND US NEWS

• Fed Chief to give evidence tonight.
• US adults spend 10 1/2 hours a day interacting with media. That is a lot.
• The US has announced preliminary duties on fabricated structural steel from Mexico and China.
• Here is a scary thought. In the UK there are 300 banks and 45 building societies. In Germany, there are 1800 banks and credit unions.
• BASF warns over the trade war and slides 5%. Not been a good time for German companies. Bayer springs to mind, as well as Deutsche.
• Trump says he will no longer deal with UK ambassador. Loves Queen though. Especially Bohemian Rhapsody.
• The Italian finance minister is looking at selling Italian 50-year bonds. Good luck with that. Budget sorted. Holidays call. Ciao.

 

And finally…my thanks to my friend Stephen Holland for his wonderful dad jokes..

Crime update : A gang of thieves is going around shoplifting clothes in order of size. Police say they’re still at large.

You may have heard I recently applied to join the X-Men. When Professor X asked what my superpower was, I answered “hindsight”. He said “that’s not going to help us” and I said “yes, I see that now….

My new GP is German. I went to see him the other day, about the strange dreams I’ve been experiencing. I dream I’m in a band with Robert Smith. I asked him for a diagnosis. He told me ‘I zink you are insecure’.

I’m reading a great book at the moment called ‘The History of Glue’. I can’t put it down.

Last night I went to see a play about fly fishing. The cast was amazing.

 

Clarence

XXX