ASX 200 rallied another 36 points to 6643 as enthusiasm for the mini deal waned as the day wore on. US futures up 59 points with Columbus Day in the US. A big jump on the open led by banks , despite new inquiry, and the big miners. CBA up 0.4% and WBC up 0.5% with BHP up 2% and RIO up 2.2%. Gold stocks were in the doghouse as bullion fell and the AUD rose. NCM down 4.8% and NST down 5%. TLS had a nasty day today falling 1.7%. Bond proxy stocks slipped as yields rose with TCL down 0.7% and SYD down 0.2%. Consumer stocks track slightly higher with WES up 1% and WOW up 0.4%.  In corporate news STO had a good day up 5.65% following its value accretive deal with ConoccoPhillips. Nothing locally on the economic front but Chinese numbers showed the consequences of the trade war. AUD pushed higher towards 68c. 10-year bond yields rose slightly to 1.04% and Asian markets rose slightly with Japan up 1.15% and China up 1.34%.

Todays Highlights

• ASX 200 closes up 36 top 6643 as trade deal rally wanes.
• High 6676 Low 6622. Modest volumes.
• Banks and miners rally.
• Energy stocks push up but TLS suffers.
• AUD firms to 67.89c
• 10-year yields up at 1.41%
• Aussie gold smacked down to $2190
• Bitcoin weaker at US$8287
• US futures up 59 points
• Asian markets firm with Japan up 1.15% and China up 1.34%

STOCKS

• CYB +12.09% Brexit hopes cheer.
• SWM +6.85% discussions to sell magazines.
• FPH +7.02% upgrades guidance.
• STO +5.65% buys ConoccoPhillips LNG assets.
• WOR +4.08% oil price rise.
• JHG +5.42% broker upgrade.
• AMP +3.73% optimism returns.
• WGX -9.24% quarterly results.
• RMS -8.33% SLR -9.18% SAR -8.33% bullion price falls.
• CLV -5.00% profit taking.
• PPT -4.00% FUM falls.
• SVY +22.22% NML to recommence exploration.
• SPT +17.50% signs up Shopify.
• PPS +18.89% FUM rise.
• PDL +1.60% more pain ahead according to UBS.
• CMP +11.48% written up this morning.
• ALC -10.91% presentation.
• PDN -6.00% PFS delivers for Heinrich Langer.
• HMC +11.94% first day surge for former Masters stores REIT.
• Speculative stock of the day: SVY +22.22% and SPT +17.50% shine. Nothing else on volume.
• Biggest Risers: CYB, HMC, CIA, FPH, CGC, SWM and IFT.
• Biggest Falls: WGX, SLR, SAR, GOR, PRU and IRI.

TODAY

• Praemium (PPS) +18.89% Reports September FUA $20.02bn vs quarter-ago $16.09bn. PPS saw record quarterly gross inflows of $1.0bn and net inflows of $558m.
• Santos (STO) +5.65% will buy ConocoPhillips LNG assets in Northern Australia for US$1.4bn. The agreement covers operating interests in the Darwin liquefied natural gas operation, Bayu-Undan, Barossa and Poseidon projects. Funding from existing cash and new debt. It is expecting earnings to be lifted by around 16% in 2020 on the deal. Production will be up 25% too.
• FlexiGroup (FXL) 0.45% To open a data room for the potential sale of its Australian and New Zealand commercial equipment leasing operations. Sources tell The Australian newspaper that FlexiGroup has been seeking $300m for the ANZ commercial equipment leasing operations, which may have been too high for Scottish Pacific which had previously been interested. The plan is for company to divest its non-core assets to ramp up its Humms division to compete against “buy now, pay later” providers Afterpay and Zip.
• Paladin Energy (PDN) -6.00% To restart its flagship Langer Heinrich Mine in Namibia after completing a pre-feasibility study (PFS1) which focused on improved financials and production capacity.
• Fisher & Paykel Healthcare (FPH) +7.02% Upgrades guidance following regulatory approval to sell its Vitera mask in the US. Expects full-year operating revenue to be approximately $1.19bn vs previous guidance of $1.17bn and net profit after tax to be in the range of $255m to $265m vs previous guidance range of $245m-255m.
• Thorn Group (TGA) – Chair David Foster to retire effective October 23, Warren McLeland appointed as interim replacement. McLeland is the former CEO and Executive Chairman of Resimac and is the Chairman of Somers Limited, the major institutional investor in Thorn Group.
• Seven West Media (SWM) +6.85% Has responded to media speculation that it is in talks with German publisher Bauer regarding its magazine interests. SWM had this to say, “no binding agreement has been concluded and any agreement, were it to be concluded, would be subject to regulatory approval and obtaining other consents”.
• Latitude Financial (LFS) – Media reports that the ASX’s biggest IPO this year is being repriced at 178c after it was priced Friday at the bottom end of the range, at 200c. The repricing this morning comes as the bookbuild kicks off and is supposedly to ensure the issue gets away and trades well in the aftermarket. The cynics would suggest that demand is soft hence the repricing. It is now priced at 11 times profits and a yield of 5.8%. At 178c it is somewhat more attractive than we had written a couple of weeks ago and may hold some appeal especially given the rally in financials post the mini deal.
• Splitit (SPT) +17.50% North America operations update; partnership with eCommerce platform Shopify, which will see SPT’s buy now pay later (BNPL) solution available to Shopify’s network of more than 800,000 merchants across 20 countries.

ECONOMIC NEWS

• ACCC launches inquiry into banks on rate cuts not being passed on.

BOND MARKET

• 2 – year bond yields up 2bps to 0.70%
• 3 – year bond yields up 2bps to 0.73%
• 10 – year bond yields up 3bps to 1.04%

ASIAN NEWS

• China’s trade balance rose in September from $US34.84bn to $US39.65bn.
• Chinese exports fell 3.2% in September, worse than market expectations of -3%. Imports also fell more than forecast, -8.5% in September, expectations were for a 6% slump.

• January to September exports to the U.S. dropped 6% and imports declined 22.5% year-on-year in yuan terms. Total trade with the U.S. was 2.75 trillion yuan, down 10.3% over the same period.
• Softbank in talks on WeWork financing and/or possible control.
• Singapore avoids a technical recession. Just.

EUROPEAN AND US NEWS

• Mixed opening for Euro markets.
• Mastercard, Visa, Ebay and Stripe quit the FB Libra experiment on regulatory issues.
• Elizabeth Warren edges into the lead as Democrat candidate.
• EU is apparently baffled by Boris’s proposals on the Irish question.
• President Trump is set to impose ‘very powerful’ sanctions on Turkey.
• Putin heads to Saudi Arabia. Largest ever delegation of businesses in the Kingdom.
• In the UK, Queens Speech kicks off a crucial week for Boris. 839 days since last Queens Speech. June 21^st 2017 was the last one. Speech could even be voted down. Something that hasn’t happened since 1924.
• WTO dispute settlement body meets today. Airbus tariffs will be legally enforceable from today. 25% on French cheese and wine.

And finally………….Thanks Hans

 

A lady in a retirement centre in Florida was sitting on a bench, near another bench where a gentleman was sitting.  She asked him if he was new to the community and he said “no, I have owned a condo here for 20 years”.

She  said, “I have been here for 15 years and I have never seen you around!”

He said, “I have been in prison for the last 17 years!”

She was stunned, and finally asked him what he had done.

He said that he had murdered his first wife!

She was stunned again … and after a long pause she said …

“So, you’re SINGLE???”

Clarence

XXX