The ASX 200 rose 33 points (+0.47%) to close at 6995. Thin volume continues but the target has been set and now achieved. Dow Futures down 79 points as the deal lite is set to be signed tonight. Some disappointment in the timetable for lowering tariffs and the Phase Two deal taking the gloss off some markets. Banks led the market higher. Hard to believe that CBA is knocking on the door of a three-year high given the headwinds from the RC and the resulting fallout. Kudos to Matt Comyn. CBA up 0.6%. Good to be the king. Signs of life in the other three with WBC up 0.5%. Insurers doing better with QBE up 0.9% and MQG up 0.3% of course. Heavy gearing to equity markets helping there and results from US investment banks bode well for the ‘Millionaires Factory’. Healthcare still the one as CSL rose 0.4% and industrials better too with CIM up 5.2% on Theiss news and consumer stocks picking up too. WES up 0.5% and ALL up 0.9% although COL down 0.4% and WOW down 0.2% looks like some sector realignment. In the miners, BHP rose 0.3% and gold miners were in an ebullient mode with NCM up 3.1% and EVN up 5.8%. Energy stocks better too with WPL up 0.4% and STO up 1.0%. After a terrific run, lithium stocks took a pause with SYR down 7.0%, ORE down 5.5% and GXY down 4.7%. In corporate news, CIW up 6.4% after passing $1bn in FUM, PPT up 0.3% after its FUM rose to $26.3bn. RSG rose 0.8% after selling its Ravenswood gold mine for $300m, GTK fell 24.9% on a business update and MS pushed TYR after recent listing and it rose 2.6%. 10-year bond yields fell 1bps to 1.20%. The AUD steady around 69c. Asian markets under a little pressure ahead of signing, China down 0.62% and Japan down 0.66%.

 

Today’s Highlights

• ASX 200 up 33 to 6995
• High 6997 Low 6960. Low volume again.
• Trade deal lite in focus as Mnuchin walks back optimism.
• Banks back as CBA hits near three-year highs.
• Miners see small gains. Golds shine.
• Healthcare and industrials
• 10-year bond yields 1.20%
• AUD fades to 68.96c
• Dow futures down 82 points
• Aussie gold down to $2250
• Bitcoin back up to US$8495 in strong rally.
• Asian markets: China down 0.62%. Japan down 0.66%.

FUTURES AND HIGHS AND LOWS

 

 

INSIGHTS FROM MARCUS TODAY TEAM

• HENRY’S TAKE: Punching the air. Never a good thing. Portfolio showing strong gains with TNT recommended yesterday, up 50% in a day at one point. A look at the Lithium revival underway, a health check on the portfolio stocks and Livewire’s most tipped small caps.
• IDEA OF THE DAY: Day three back at the desk – time for a round-up of what to expect in 2020.

STOCKS                                               

• SBM +8.12% fires up on bullion gains.
• ELD +5,74% rural stimulus post bushfires help sentiment.
• NUF +4.20% stimulus hopes.
• PBH +2.64% momentum driving higher.
• MSB +6.09% conference presentation.
• RDY +14.94% Macquarie upgrades.
• PET +6.49% good to see.
• PLS -7.69% lithium boom busts.
• ORE -5.54% GXY -4.72% bears back in da house
• GTK -24.93% another downgrade.
• SYR -7.04% profit taking bites.
• TNY -5.94% profit-taking.
• WHC -1.89% coal stocks on the nose thanks to BlackRock.
• Speculative stock of the day: Kalamazoo Resources (KZR) +60.87% strong day on good volume as Novo and legendary commodity investor Eric Sprott invest $8m to take 20m shares at 40c. KZR has the Castlemain Gold project with hits of around 1.42m @261g/t from 100m.
• Biggest Risers: PAR, SBM, MSB, EVN, ELD, AGG and IMF.
• Biggest Falls: PLS, ORE, MAH, GXY, WSA, NIC, AFG and NEA.

TODAY

• Resolute Mining (RSG) – sells Ravenswood Gold Mine to consortium for $300m. $100m upfront with up to $200m in potential payments dependent on future gold prices.
• Perpetual (PPT) – reports FUM $26.3bn at 31-Dec vs quarter-ago $26.1bn. The lift in FUM came from $1.1bn worth of net inflows into Cash and Fixed Income, which was offset by $0.8bn of net outflows from Australian Equities primarily from the Intermediary and Institutional channels.
• New Century Resources (NCZ) – divests 49% stake in Lawn Hill & Riversleigh Pastoral Holding Company to Waanyi SPC for $9.8m. The deal preserves rights of New Century to access the pastoral properties for the purpose of exploration.
• Gentrack(GTK) –  Difficult conditions are continuing in key utility markets, hitting the sales pipeline by more than previously expected. It has started a detailed forecasting exercise and expects to release an updated financial year 2020 outlook within a week.

ECONOMIC NEWS

• Nothing significant today.

BOND MARKET

ASIAN NEWS

• PBOC injected CNY300B (US$43.5B) in one-year medium-term lending facility loans and kept the interest rate at 3.25%. Traders had been expecting a liquidity injection before the week-long holiday, and some said China’s decision to stay put on interest rates was a slight disappointment.

EUROPEAN AND US NEWS

• Phase One to be signed but looks like deep cuts to tariffs are part of Phase Two which may be after the US election in November. The signing may be more symbolic but at least things are not going from bad to worse. The enforcement mechanism will be difficult for China to swallow it seems.
• Elizabeth Warren says she will pull all troops out of the Middle East in latest debate with Tom Steyer, Joe Biden, Bernie Sanders, Pete Buttigieg, Amy Klobuchar and uncle Tom Cobley..
• James Murdoch is taking aim at Rupert and Newscorp. Funny James was once thought of being the heir apparent.
• Apple continues to defy Trump and authorities on data sharing from Pensacola killer’s iPhone.
• The US has named Switzerland as a ‘currency manipulator” Tough cheese for those guys.

 

And finally ……………

I want to die peacefully in my sleep, like my grandfather. Not screaming and yelling like the passengers in his car.

 

Two older women were outside their nursing home, having a smoke, when it started to rain.

One of the ladies pulled out a condom, cut off the end, put it over her cigarette, and continued smoking.

First Lady:Whats that?

Second Lady: A condom. This way my cigarette doesn’t get wet.

First Lady: Where did you get it?

Second Lady : You can get them at any chemist.

The next day, Lady 1 hobbles herself into the local drugstore and announces to the pharmacist that she wants a box of condoms.

The guy, obviously embarrassed, looks at her strangely (she is, after all, over 80 years old), but very delicately asks what brand she prefers.

Doesn’t matter son, as long as it fits a Camel.

Clarence

XXX