The ASX 200 fell from the open closing down 92 points at 5330 (-1.7%) at its lows. Dow Futures down 107 points. Tried to rally but gave up at the close. The mid-morning jobs numbers showed the true horror of the jobs situation but the headline number of 6.2% hid many sins. Banks were understandably under pressure with CBA down 3.2% after broker research. The Big Bank Basket fell again to $104.24. Elsewhere broad-based losses with CSL down 2.7% and BHP sliding 1.3% on potential Norges Bank sales perhaps. Energy waned with WPL down 23.0% and STO down 3.4%. In the industrials, a few companies returned to trade and were greeted with a round of applause, BRG was one up 6.7% though AFG returned to trade down 11.3% after its raise. In the tech spot, XRO set the tone after its results down 4.8%, The All Tech Index fell 2.7%. REA dropped 1.6% and APT fell 4.2% as it gave up some recent gains. In corporate news, GNC cheered the market on results rising 11.5%, new demerged UMG is raising fresh funds, NCM rose 3.6% on some promising drill results. ICQ rallied 6.0% after a business update though AMS fell 16.1% on its update. The 10-year yield slipped to 0.89% and the AUD was weaker to 64.37c on the jobs number. Asian markets weaker with Japan down 1.5% and China down 0.9%.

• ASX 200 down 93 to 5329. Loses 20 plus on the match out.
• High 5409 Low 5329. Narrow range. Low volatility.
• Record jobless falls but headline cheers slightly.
• Big Bank Basket down to $104.24. Banks remain the Achilles heel of the ASX.
• All Tech down 2.7%
• Dow futures down 135.
• 10-year bond yields tumble to 0.89%
• AUD slips to 64.37c on jobs number.
• Aussie gold rallies to $2662
• Bitcoin rallies to US$9348.
• Asian markets weaker with Japan down 1.5% and China down by 0.9%

STOCKS                                               

• GNC +11.55% good results
• MSB +8.26% Yanks like the placement.
• BRG +6.68% back after capital raising.
• NSR +6.50% ceasing to be a substantial shareholder.
• JIN -7.27% No jackpots only lemons.
• EOS -6.81% selling pressure resumes.
• GEM -5.50% director retirement.
• AMS -16.06% capital raising weighs.
• AFG -11.31% back trading after cap raise.
• M7T +8.70% new software deal.
• ICQ +6.00% trading update.
• XRO -4.77% caution ahead.
• NCM +3.57% drilling results.
• QBE +0.82% SPP results.
• Speculative stock of the day: Shaver Shop (SSG) +30.23% Trading update and CV19 effects. Online revenue doing very well up 387% in the six weeks from April1st to May 10^th.
• Biggest Rises: GNC, MSB, BRG, PPH, CHC, NSR, NCM and SBM.
• Biggest Falls: URW, MMS, JIN, NEA, CUV, EOS, NEC and QAN.

TODAY

• United Malt Group (UMG) – to launch $140m raising via institutional placement at $3.80/share and SSP worth $25m. Reports H1 underlying NPAT (pre AASB 16 impact) $29.3m vs year-ago $28.7m. Revenue $664.6m vs year-ago $609.5m. Underlying EBITDA $71.2m vs consensus $77.6m. No interim dividend. Expects a slow return to pre-COVID-19 volumes as restriction ease. April volume was lower (~30%). Notes flexibility to curtail some production capacity (if required) and adjust the cost structure to meet lower demand in the near-term. Targeting $10m cost savings in H2 of discretionary spending and capex deferral of $5m for FY20 factored into H2.
• Charter Hall Group (CHC) +4.25% continues to attract equity inflows across all source segments, with $1.6bn of new equity raised since the end of December 2019. Total FUM at the end of April totalled $39.2bn. The Group reaffirms its FY20 guidance for after-tax OEPS growth of approximately 40% over FY19 and FY20 distribution per security guidance for 6% growth over FY19.
• iCar Asia (ICQ) +6.0% unaudited revenue year to date (April) $4.3M, +18% vs year ago. Net operating cash outflow ($0.4m) in April. Q2 outlook improving with the Group’s two largest markets by revenue, Malaysia and Thailand, relaxing movement, and business restrictions from the beginning of May.
• Xero (XRO) -4.77% Reports FY NPAT NZ$3.3m vs year-ago (NZ$27.1m) and consensus of NZ$10.6m. Revenue up 30% to NZ$718.2M vs consensus NZ$725.5m. Adjusted EBITDA NZ$173.5m vs consensus NZ$146.2m. Subscriber growth of 26% to 2.3m. Outlook comments, “while Xero has performed strongly in FY20, trading in the early stages of FY21 has been impacted by the COVID-19 environment. The continued uncertainty surrounding COVID-19 means it would be speculative for us to say anything more at this time on its potential impact on our expected performance for FY21.”
• GrainCorp (GNC) +11.55% H1 Underlying NPAT $55m vs year-ago ($48m). Revenue $1.96bn vs consensus $1.63bn. Underlying EBITDA from continuing operations $110.1m vs consensus $88.4m. Outlook comments, “FY20 capex is expected to be between $35-45m and includes preparation for next season’s harvest. GNC is planning for higher grain exports in 2H20 and lower grain trans-shipments to ECA ports as domestic demand is likely to taper with expectations of a stronger crop in FY21. Oilseed crush margins are expected to remain favourable in H2 due to prevailing canola oil and meal values. Favourable soil moisture levels across large parts of eastern Australia has supported widespread planting for the FY21 crop.”
• Caltex Australia (CTX) -2.53% March refiner margin update; CRM US$4.83/bbl vs year-ago US$10.96/bbl. CRM sales from production 454ML vs year-ago 440ML. Reduced production was driven by the poor refiner margin environment. Lytton Refinery has now commenced the extended outage for Turnaround and Inspection (T&I) and all feedstock input to the refinery has ceased.

ECONOMIC NEWS

ABS Jobs Data

• Headline number much better than expected. 8.3% was the forecast .6.2% is the headline number. The larger than usual number of employed and unemployed people leaving the labour force resulted in an unprecedented fall in the participation rate by 2.4% to 63.5%.
• Unemployment increased by 104,500 people to 823,300, and the unemployment rate increased by 1.0% from 5.2% to 6.2%.

• Around 2.7m people (about 1 in 5 people employed in March) either left employment or had their hours reduced between March and April. This was much greater than in previous years.
• As a result, the number of underemployed people also rose sharply (up 603,300 people, to a total of 1.8m people), and the underemployment rate rose to a record high 13.7% (up 4.9 %).
• The underutilisation rate, which combines the unemployment and underemployment rates, also rose to a record high of 19.9%.
• Seasonally adjusted employment fell by 594,300 people between March and April, according to the Australian Bureau of Statistics. Large changes were seen across all labour market indicators in April.

• Monthly hours worked in all jobs decreased 163.9 million hours to 1,625.8 million hours.

• New Zealand unveiled a record $NZ50bn ($46.5bn) fund in its budget on Thursday. The massive spending, which includes billions on infrastructure, healthcare, housing and an extension of its wage subsidy scheme.

CV19 NEWS

• The coronavirus may have triggered a 30-fold jump in cases of a serious but rare pediatric inflammatory disease, according to an Italian study.
• A divided Wisconsin Supreme Court decided that an unelected state agency head’s emergency order shutting down the state because of the Covid-19 pandemic is not enforceable.
• Japanese Prime Minister Shinzo Abe was set to end the state of emergency in 39 of the country’s 47 prefectures earlier than scheduled.
• The Qatari government ordered all citizens to wear masks when they step outside for any reason beginning May 17.

BONDS

ASIAN NEWS

• Aramco cuts term oil supply to at least 12 Asian customers. The cuts in supply to the world’s biggest oil market are a sign OPEC members are adhering strictly to the agreement to curb production, which took effect May 1.

• China temporarily became Australia’s biggest market for LNG last month, receiving 40 cargoes, a bounce up from 29 in March and well above last April’s total of 36, according to new figures from consultancy EnergyQuest. Australia is China’s largest supplier of LNG, and China accounted for about 40% of Australia’s exports in April.

EUROPEAN AND US NEWS

• European markets expected to open around 1% lower.
• Roche Holding AG’s coronavirus antibody test was given the green light by a U.K. health authority, a boost to Boris Johnson. 100% accurate it appears. The test not Boris.
• President Trump has accused Dr. Fauci of playing both sides of the equation with his recent testimony.
• The UK is planning to cut US farming tariffs to seal a trade deal.
• Musk has won his battle to reopen his plant in California.
• Starbucks starts to reopen 150 stores in the UK. Drive-thrus and takeaways. The Horror.

And finally…

A man walks into an emergency room with two black eyes and a broken nose. The doctor asks him what happened.

“Well,” says the man, “I was having a nice round of golf with my wife. She sliced her ball into a pasture of cows. We went to look for it, and while I was rooting around, I noticed that one of the cows had something protruding from its rear end. Sure enough, when it lifted its tail, there was my wife’s golf ball.”

“And?” asked the doctor.

“Well,” the man said, “that’s when I lifted the cow’s tail, pointed, and yelled to the missus, ‘Hey, honey—this one here looks like yours!'”

Clarence

XXX