ASX 200 slips 12 points to 6641 in a calm and narrow range day. US Futures slipped 9 points. Banks were once again on the nose as the market went sideways. School holidays are taking their toll it seems. Reporting season coming sharply into focus both here and in the US. WBC down 0.5% and NAB down 0.7% were the worst of the four. AMP fell 1.66%. Miners rose slightly on Asian ore price rises, BHP up 0.4% and FMG up 1.7% though RIO fell 0.6% after its production report and cost blow outs in Mongolia (again). Gold miners were mixed with GOR up 5.5% and NCM off 0.4%. Healthcare higher led by CSL up 0.6%. Nothing much in corporate news, RBA minutes today showed the central bank is still looking at another cut. Bond yields were weaker with 10s down 6bps to 1.39% as the AUD rose slightly to 70.37c and Asian markets were all back online and weaker as Japan returned from a long weekend. Japan down 0.71% and China down 0.50%.

Todays Highlights

• ASX 200 fell 12 to 6641. Sloppy finish.
• High 6665 Low 6641. Quiet tight range trade.
• Banks fall again. Miners rise on iron ore.
• Gold miners mixed too.
• Energy falls and Tech and telcos under pressure.
• REITs back in demand.
• RBA Minutes point to more cuts to come.
• 10-year bond yields rally 8bps
• AUD firms to 70.37c
• Aussie gold steady at 2009.
• Bitcoin rises slightly to $10,762
• US futures down 9.
• Asian markets weaker with China down 0.50% and Japan down 0.71%

STOCKS

• GOR +5.51% another strong day.
• PO3 +17.35% TB trial for water treatment tech.
• PET +4.25% turns around on PO3 news.
• HUB +3.89% good FUA news.
• GXY +4.20% June quarter conference and report.
• NUF +3.04% Bayer settlement adjusted down.
• NGI -5.97% Investor briefing.
• NHF -3.77% media reports on Private Health care inquiry calls.
• DMP -4.27% stuffed crust.
• PNV -3.95% profit taking again.
• SEK -0.18% block trade at 2157c for $5.5m worth.
• ING +0.72% $12.8m transacted in a block at 421c.
• CRN -3.86% WHC -3.94% coal under pressure.
• LYC -2.88% one-year Lost Time Injury (LTI) free.
• OSH -2.18% production report.
• CYP +11.89% thin but solid.
• WZR +10.00% starting to move.
• LVT -2.83% speeding ticket.
• PPT -5.85% FUM notice and AMP weighs.
• RFT +14.04% recommended 4^th April at 3.1c. doubled now.
• ANO -6.53% liquidity again an issue.
• ARU -7.07% entitlement issue fails to inspire. 35% take up.
• Speculative stock of the Day: De.Mem (DEM) +37.14% then a trading halt pending an announcement. Looks like word is out and it will be a goody.
• Biggest Risers: WPP, GOR, SWM, NIC, PET and GXY
• Biggest Falls: NGI, PPT, DMP, MYX, PNV and WHC.

TODAY

• Rio Tinto (RIO) –0.64% Second quarter production. Pilbara iron ore shipments down 7% year on year due to recovery works following Tropical cyclone veronica. Pilbara shipment guidance for FY19 unchanged. Unit cost guidance revised to $14 – $15 per tonne (previously $13 – $14 per tonne). Mined copper production down 13% year on year, with lower production from Escondida and Kennecott reflective of lower grades.
• HUB24 (HUB) –3.89% Reports June quarter net inflows of $979m, up 32.4% on the previous corresponding period. Funds under administration of $12.9bn at 30 June, up 54.3% on pcp.
• Galaxy Resources (GXY) +4.20% Quarterly production at Mt Cattin came in at 56,460 dry metric tonnes (dmt) vs guidance of 45,500-50,000dmt. GXY is targeting shipments of between 60,000-70,000dmt in Q319.
• St Barbara Limited (SBM) -0.30% Atlantic Gold shareholders vote in favour of SBM acquisition for $779 million. The Arrangement is expected to be completed on Saturday 20 July 2019 Melbourne time.

ECONOMIC NEWS

• ANZ-Roy Morgan Consumer Confidence Index fell 1.5% to 115.8 points.

RBA Minutes

For the full minutes click here

Here are the highlights:

• Wages growth had remained low overall. In combination, these factors suggested that spare capacity was likely to remain in the labour market for some time.
• Members judged that a further reduction in the level of interest rates would support the necessary growth in employment and incomes, and promote stronger overall economic conditions, which would in turn support a gradual increase in underlying inflation.
• Members recognised that, in the current environment, the main channels through which lower interest rates would support the economy were a lower value of the exchange rate than otherwise would be the case and lower required interest payments on borrowing, which would free up cash for other expenditure by households and businesses.
• Members agreed that the Australian economy could sustain a lower rate of unemployment, while achieving inflation consistent with the target.
• The RBA does seem to think that a rebound in spending and lower lending rates will not have an undesirable effect on house price reinflation. So it seems like another one on the way. Timing now the issue. Basically, lower rates are good for Australians and good for the economy.

BOND MARKETS

• 2-Year bond yields down 4bps to 0.95%
• 5-Year yields down 4bps to 1.02%
• 10-Year yields down 4bps to 1.39%
• New government indexed Treasury bonds pay 1.25% until February 2022. Demand was so strong with investors willing to take 0.2% after 50 bids worth $740m for just $150m were lodged.

ASIAN NEWS

• The IMF sees Singapore’s economic growth slowing to 2% in 2019 as global trade tensions hurt external demand. Growth will probably stabilise in the “medium term” around 2.5%.
• Budweiser float got pulled yesterday with around US$170m in IPO fees going down the drain. MS and JP Morgan the biggest losers.

EUROPEAN AND US NEWS

• 8 Days until Boris Johnson takes the helm.
• Iran has invited the US to resume talks on the nuclear option.
• Straßberg vote for Von Der Leyen today. Who? New EU Commissioner in chief.
• Markets muted start in Euroland.
• Amazon workers protest on wages and conditions during the Prime promo.
• The Institute of International Finance (IIF) has reported that Emerging Market debt hits a record high with global debt at US$246 trillion. EM debt now 216% of GDP. Total US debt US$70 trillion.

And finally…

A golfer was having a terrible round – 20-over par for the front nine with scores of balls lost in water or rough. When his caddie then coughed as he steadied himself over a 12-inch putt on the 10th, he lost it.

“You’ve got to be the worst caddie in the world!” he yelled.

“I doubt it,” replied the caddie, dead-pan. “That would be too much of a coincidence.”

 

After a particularly poor round, a golfer spotted a lake as he walked despondently up the 18^th.

He looked at his caddie and said, “I’ve played so badly all day, I think I’m going to drown myself in that lake.”

The caddie, quick as a flash, replied, “I’m not sure you could keep your head down that long.”

 

As a couple approaches the altar, the groom tells his wife-to-be, “Honey, I’ve got something to confess: I’m a golf nut, and every chance I get, I’ll be playing golf!”

“Since we’re being honest,” replies the bride, “I have to tell you that I’m a hooker.”

The groom replies, “That’s okay, honey. You just need to learn to keep your head down and your left arm straight.”

 

Clarence

XXX