ASX 200 up 164 to 5780 (2.9%) to 5780 as we wave the bear behind. Dow futures up 508 points. Off to the races, today as yesterday’s buyers came back with a vengeance. The ScoMo lunchtime battle plan cheered the market too and sellers were in full retreat across the board. Today was the day of catch up for those that have missed out. The Big Banks rallied strongly with WBC up 6.3% and NAB up 5.65% with the Big Bank Basket up 110.77%. Other financials popped champagne corks with MQG up 2.4% and MOC doing well up 17.4%. Miners were better but not the star attraction. BHP up 2.1% and FMG lost 0.4% with the gold miners slightly higher as index changes loom, NST up 3.2%, and EVN up 2.5%. Energy stocks better with WPL up 2.7% and STO up 4.0%. Healthcare naturally did well, CSL showing its class up 3.1% and RHC up another 2.4%. Consumer stocks in demand but travel stocks were the standouts. FLT up 9.5%, WEB up 5.8%, and HLO doing the best up 32.7%. REITs pushed ahead GMG up 3.8% and SCG doing better up 5.6% and URW played some catch-up football after two days of losses, URW rose 12.7%. Tech stocks were market performers with the All Tech Index up 2.4% with APT hitting $50 at one stage although well off that up 1.3%, XRO doing well up 3.1%, CPU up 4.0%, and APX up 3.3%. In corporate news, DOW rose 6.8% after expanding a contract with FMG and CCL fell 1.6% after a trading update. The 10-year bond yield rose to 0.87%. AUD better at 65.79c and Asian markets rallying hard too, China up 0.83% and Japan doing especially well up 2.17%.

Today’s Highlights

• ASX 200 up 164 to 5780.
• High 5780 Low 5620.
• Big Bank Basket up to $110.77
• All Tech rallies hard up 2.4%
• Dow Futures up 508.
• 10-year bond yields rose to 0.87%
• AUD firms to 65.83c.
• Aussie gold eases to $2634.
• Bitcoin rises to US$8911
• Asian markets firm with China up 0.83% and Japan doing especially well up 2.17%.

FUTURES AND HIGHS AND LOWS

STOCKS

• URW +12.71% good rebound but still debt an issue.
• MND +11.25% bargain hunters back
• MOE +10.32% AGN Results.
• FLT +9.53% CTD +3.21% HLO +32.73% travel in spotlight.
• EOS +5.75% livewire write up.
• LYC -1.43% presentation.
• JMS -3.33% profit-taking.
• NCZ -8.00% potential acquisition from Vale.
• ALG -1.25% QLD closed still.
• PGL +21.57% the bulls roar back.
• SXL +15.62% leverage to recovery.
• LEG +13.33% drilling results.
• APT +1.26% now a Top 50 stock.
• Speculative Stock of the Day: Intelicare (ICR) +52.38% a great second day of trade. Good volume too.
• Biggest Rises: URW, SIQ, MND, FCL, MOE, FLT, GEM and IFN
• Biggest Falls: JMS, PPH, MGX, ALK, PNI, OCL and MVP.

TODAY

• Qube Holdings (QUB) +1.11% Completes entitlement offer raising $500m.
• LiveHire (LVH) +6.82% Wins Victorian Government contract for staff deployment. The contract is around 8x the average annualised recurring revenue (ARR) normally received from a single client.
• Afterpay (APT) +1.26% To join the MSCI Australian Index at the close of business Friday. Evolution Mining (EVN) and Northern Star Resources (NST) also set to join MSCI.
• ANZ (ANZ) +5.97% CEO Shayne Elliott has reportedly told 3AW the scale and breadth of operations in China may well change due to escalating trade tensions. Elliott added that the trade dispute and protests in Hong Kong had raised the risk profile around certain parts of the bank’s business in the region.
• Coca-Cola Amatil (CCL) –1.56% April was a challenging month for the group, COVID-19 restrictions felt across all markets throughout the peak Easter and Ramadan trading periods. Group Volume fell by ~33% compared to the previous corresponding period (pcp). Revenue since the start of April has broadly declined in line with Volume, although the impact on margin has been much greater, reflecting shifts in channel and package mix, particularly in Australia. This adverse impact has been compounded by the loss of scale in Indonesia resulting in a large impact on EBIT. Trading in the first three weeks of May has seen Volume fall ~26% on the pcp. With lockdown restrictions easing some green shoot improvement has been observed.
• St. Barbara (SBM) +0.31% Repeats full-year guidance. Gwalia production unchanged at 170-180Koz. Simberi production unchanged at 105-115Koz. Atlantic production unchanged at 95-105koz. AISC at $1,375/oz, the midpoint of the previous guidance range.

ECONOMIC NEWS

• ANZ-Roy Morgan Weekly Consumer Confidence gained for the eighth straight week up 0.4% to 92.7. The index has firmed 42% from its low point in March. While still below average, sentiment is now only ~15% below its level at the end of February.

• For the week to May 22, personal spending is now in positive territory up 2.3% on the same week last year, according to ANZ’s data while CBA shows that it is up 4%.
• Retail spending is now 22.4% higher this time last year, while grocery and pharmacy spending is 23.9% higher.
• The hardest hit is the travel and entertainment categories down 53% lower than this time last year.

COVD-19 NEWS

• Novavax began human testing of its coronavirus vaccine candidate and anticipates providing a first look in July at what sort of immune responses are generated
• Latam Airlines Group SA, Latin America’s largest air carrier, sought bankruptcy court protection in New York.
• In Hong Kong Karaoke bars, bathhouses, party rooms and nightclubs will be allowed to return to business starting this Friday.
• Saudi Arabia said it will begin gradually easing coronavirus lockdown restrictions on May 28.
• BoJ pledges to cut rates and support asset purchases Nikkei hits a 11-week high.

BONDS

ASIAN NEWS

• The PBoC set the yuan ‘fix’ at a new 12-year low after allowing it to weaken for a third straight day. The ‘fix’ was set at 7.1293 against the US dollar, its lowest level since February 2008.
• Singapore economic reset. The economy shrank 4.7% in the first quarter. The government now expects the economy to contract by between 4% and 7% for the year, worse than its previous forecast of between 1% and 4%.

EUROPEAN NEWS

• FTSE futures playing catch up around 2.5% higher. DAX and CAC up around 1.2%
• HSBC considering more drastic cost-cutting and job losses.
• Elon Musk close to sending humans into space. Virgin Orbit fails to launch.
• Dominic Cummings struggling to explain Castle visit on wife’s birthday.
• German govt buys 20% of Lufthansa but wants out by 2023. Total cost around EUR300m. Bailout package worth US$10bn. Management said last month it is losing around EUR1m an hour and is carrying only about 1% of its normal passenger load.
• Aston Martin CEO to step down.

 

And finally…

Why did the Irishman give up internet shopping?

The trolley kept falling off the computer.

 

On their 25th wedding anniversary and during the banquet celebrating it, Joseph was asked to give his friends a brief account of the benefits of a marriage of such long duration. “Tell us Joseph, just what is it you have learned from all those wonderful years with your wife?” Joseph responds, “Well, I’ve learned that marriage is the best teacher of all. It teaches you loyalty, meekness, forbearance, self-restraint, forgiveness — and a great many other qualities you wouldn’t have needed if you’d stayed single.”

Clarence

XXX