Taken around the 87 crash…
ASX dropped 50 points to 5416 (-1.3%). Dow Futures down points. After a dismal lead and start to the session, we saw stocks find a level and took some comfort from the jobs numbers. The banks remain the Achilles heel of the market at the moment as results and D(dividend)-Day looms. The Big Bank Basket fell to $110.04 with CBA down 1.3% and WBC down 2.3%. Other financials also weaker with MQG down 1.9% and MFG off 1.6%. Insurers though picked up a little with IAG up 3.3% and NHF up 0.6%. Miners were another soggy sector with BHP down 2.0% and RIO falling 1.4%. Gold miners though continue to enjoy higher AUD prices and were relatively table NCM up 0.1% and GOR up 1.4%. Energy stocks ran out of puff and slipped as oil hit 18-year lows. WPL down 1.4%, STO down 3.2% and CTX up 0.2% after a refiner margin update. Bond proxies and REITS were soft but off lows. TCL reported traffic numbers revealing the obvious empty roads in Sydney and Melbourne. The stock fell 4.1% and SYD also fell 1.0%. Healthcare though was one of the bright spots, CSL rose % and FPH back in favour up %. Tech stocks fell with REA down 1.7%. XRO down 0.4% and APT down 2.1% on broker downgrades. The All Tech Index fell slightly by 1.44%. In corporate news, EOS returned from its trading halt having raised some cash and fell below the issue price and down 18.26%%. BAP in a halt ahead of its capital raise. WHC fell 9.95% on its quarterly and CGC rose 0.3% after its positive update. In economic news, the jobs number actually beat estimates slightly but are out of date and had no seen the big layoffs in late March /April. Tomorrow we get Chinese GDP and tonight some US jobs numbers again. The 10-0year bond yield fell to 0.85% and Asian markets were generally weaker although losses were tempered. Japan down 1.3% and China down 0.1%.
- ASX 200 down 50 to 5416
- High 5437 Low 5345. Range continues to narrow.
- Big Bank Basket $110.04.
- Big banks and miners soggy.
- Healthcare and consumer defensives bright spot.
- Dow Futures up 24 points.
- 10-year bond yields drop to 0.85%
- AUD slips to 62.82c
- Aussie gold looks good on lower AUD at $2732
- Bitcoin drifts to US$6647
- Asian markets slightly weaker with China down Japan down
- EOS -18.26% placement and capital raise.
- CTD -15.97% FLT -12.87% travel on the nose.
- EML -9.89% credit stocks under pressure today.
- Z1P-8.80 % APT -2.15% slips affect others.
- LYC -8.64% broker downgrades post quarterly.
- WHC -9.95% quarterly report
- SGR +9.40% wins a debt lifeline for now.
- MYX +11.59% NDA sent to FDA.
- GOR +1.43% buyers still keen.
- SPL +18.28% announcement on VivaGel for CV19.
- LTR +9.89% exploration completed at Moora Nickel project.
- INR +17.39% quarterly report.
- CWN +0.48% update on staffing levels and Sydney opening.
- AT1 +95.00% IPO of the day issued at 20c raising $30m and looking at tests for CV19 with an agreement with NG Biotech for tests in France and UK. It already has a finished HIV testing product.
- Speculative stock of the day: Predictive Discovery (PDI) +28.00% two days running as impressive gold hits from RC drilling in West Africa. 14m at 10.74g/t Au and 51m at 1.27g/t Au.
- Biggest Rises: AIZ, MYX, PSI, SGR, INA, TNE and ABP.
- Biggest Falls: EOS, CTD, FLT, WHC, EML, MVP and Z1P.
- Crown Resorts (CWN) +0.48% Has progressively stood down approximately 95% or over 11,500 of its employees. Expects underlying operating cash costs to reduce to between $20-30m per month. Secured new debt facilities for a total of $560m. Intends to continue construction of the Crown Sydney project as planned and remains on track for completion of the Crown Sydney Hotel Resort by the end of the year. Has secured an additional $450m in funding to continue construction. Confirms that it will pay the FY20 interim dividend on April 17.
- Australian Unity Office Fund (AOF) -2.91% withdraws FY20 FFO guidance, revises distribution guidance. The board currently expects to pay a distribution for the quarter ending June 30 of approximately 3.0 cpu, taking the full year FY20 distribution to approximately 15.0 cpu vs prior guided 16cpu. Following the refinancing and extension of its debt facility announced in March, AOF has a weighted average debt term of 3.7 years and no debt expiring until October 2022.
- Whitehaven Coal (WHC) -9.95% reports March quarter ROM Coal Production 4,912Kt vs quarter-ago 3,124Kt. FY20 guidance remains unchanged. Total Coal Sales 4,488Kt vs quarter-ago 4,485Kt.
- IOOF Holdings (IFL) -0.78% to sell all client rights relating to the IOOF Integral Master Trust to Britannia Financial Services Limited. At the end of March, the IMT had approximately $553m of funds under administration and over 5,000 client accounts. The sales proceeds and contribution to IOOF’s underlying net profit after tax (UNPAT) of IOOF NZ are not material. The costs associated with winding down IOOF NZ are negligible
- Bapcor (BAP) – launches $180m institutional placement and $30m SPP at $4.40 per share. The placement will see around 40.9m new shares issued, representing approximately 14.3% of Bapcor’s existing issued capital. YTD revenue until the end of February +12.7% y/y although trading conditions have deteriorated since.
- The Star Entertainment Group (SCG) –3.29% New debt facility for $200m, bringing available cash and undrawn debt facilities to roughly $700m. The estimated cash requirements under a 3-month shutdown are around $220m, around $320m for a 6-month shutdown scenario. From April 2020 operating expenses are estimated to be ~$10m. Currently has ~$70m in provisions for employee benefits (accrued annual leave and long service leave entitlements) which may be accessed by employees.
- Santos (STO) -3.19% signs Letter of Intent to sell its 12.5% interest in Barossa to Japanese LNG importer JERA.
- Woodside (WPL) –1.41% March quarter production up 12% year on year to 24.2 MMboe. Realised pricing down 20% from Q1 2019. Plans to reduce 2020 total expenditure by ~50%. Guides FY20 production between 97-103MMboe.
- Transurban (TCL) –4.11% Average daily traffic (ADT) fell by 4.8% in the March quarter. Sydney traffic -5.2%, Melbourne -6.7%, Brisbane -2.2%. North America bucked the trend up 2.1%. Notes it has sufficient liquidity to meet its capital requirements and debt refinancing obligations until the end of FY21.
- Aurizon (AZJ) +3.85% reports Q3 above rail volume 63.3Mt vs year-ago 62.0Mt. Coal volume guidance for FY20 remains at 210-220mt.
- Caltex (CTX) +0.17% March refiner margin up 11.6% to US$4.62/bbl. Down 46% from US$8.67/bbl in March 2019. As mentioned earlier this month, CTX is bringing forward & extending the duration of planned Lytton refinery shutdown (commences in May).
- Starpharma (SPL) +18.28% SPL’s antiviral dendrimer (SPL7013), has been shown to have significant antiviral activity against the coronavirus that causes COVID-19. The company is evaluating product concepts and formulation options for SPL7013, which may have potential applications in the prevention and management of COVID-19.
- The trend unemployment rate remained steady at 5.2% in early March, from a revised February figure.
- Chief Economist at the ABS, Bruce Hockman, said: “Today’s data shows some small early impact from COVID-19 on the Australian labour market in early March, but any impact from the major COVID-19 related actions will be evident in the April data.”
- In March 2020, trend monthly employment increased by around 17,000 people. Full-time employment increased by around 9,000
For the full details see the ABS announcement here
A look here at the latest job ads.
China reported 46 new cases and no additional deaths. China had 1,032 asymptomatic coronavirus cases under medical observation as of April 15. In total, the country, where the virus first emerged late last year, has 82,341 confirmed cases. Its death toll stands at 3,342.
Singapore reported its highest daily increase of coronavirus cases on Wednesday. Authorities said an additional 447 cases were confirmed, bringing the total to 3,699 in the country.
- South Korean President Moon Jae-in’s ruling party scored a resounding victory in parliamentary elections, signaling to global leaders a strong response to the virus can translate into votes.
- Chinese housing data: New-home prices in 70 major cities, excluding state-subsidized housing, gained 0.13% in March from February, Price growth stalled in February because there were hardly any transactions as people stayed at home. Values for second-hand residences, which are free of government intervention, rose 0.05% after a slim decline in February
- Chinese GDP tomorrow and it will not be pretty.
- IMF suggests that Asian growth will halt for the first time in 60 years.
EUROPEAN AND US NEWS
- European futures markets are pointing to a positive start today after losses yesterday..
- Apple launches new iPhone. No 5G or facial recognition.
- Royal Caribbean Cruises is cutting more than 1,300 U.S. jobs.
- The EU faces a tough test as the area’s debt to GDP ratio heads towards 100%. No o unity on Corona Bonds. Starting to look like every man for himself.
- The war of words between USA and China continues as the blame game for the virus continues.
- The US stimulus package for SME has almost gone already. 90% of the US$350bn has been snapped up. Please send more money.
- Trump will be announcing guidelines on how the US reopens, at some stage late Thursday.
And finally..thanks Hans as always…
| Lemon Squeeze
There once was a religious young woman who went to Confession. Upon entering the confessional, she said, ‘Forgive me, Father, for I have sinned.’ The priest said, ‘Confess your sins and be forgiven.’ The young woman said, ‘Last night my boyfriend made mad passionate love to me seven times.’ The priest thought long and hard and then said, ‘Squeeze seven lemons into a glass and then drink the juice.’ The young woman asked, ‘Will this cleanse me of my sins?’ The priest said, ‘No, but it will wipe that smile off of your face.’
Muldoon lived alone in the Irish countryside with only a pet dog for company. One day the dog died, and Muldoon went to the parish priest and asked, ‘Father, my dog is dead. Could ya’ be saying a mass for the poor creature?’ Father Patrick replied, ‘I’m afraid not. We cannot have services for an animal in the church. But there are some Baptists down the lane, and there’s no tellin’ what they believe. Maybe they’ll do something for the creature.’ Muldoon said, ‘I’ll go right away Father. Do ya’ think $5,000 is enough to donate to them for the service?’ Father Patrick exclaimed, ‘Sweet Mary, Mother of Jesus! Why didn’t ya tell me the dog was Catholic?
An elderly man went to his doctor and said, ‘Doc, I think I’m getting senile. Several times lately, I have forgotten to zip up.’ ‘That’s not senility,’ replied the doctor. ‘Senility is when you forget to zip down.’