The ASX 200 closed up 49.5 points to 5992 (0.8%) in an indecisive day, finishing with a strong close. Dow futures flopped around as the jury is out on the Fed. Down 33 points Defensives and tech are leading the way ahead. Healthcare stocks back in the pink, CSL up 1.1% and FPH  flying up +5.3%%. Consumer staples were also back in demand with WES up 1.5% and WOW up 1.85%. A2M had a great day as the cream rose by 7.8%. Banks though were mixed with the Big Bank Basket at $125.86 with ANZ down 0.4% and CBA up 0.7%. REITs on the shopping trolley as GMG rose 2.6% and SCG up 3.0%. US retail sales helping sentiment. Miners in the red led by BHP down 0.7% and FMG down 1.75%. Energy stocks mixed with WPL to the better by 1.3%. Tech stocks were playing the heroes again, the All-Tech Index rose 2.32% led by APT up 2.1% and XRO up 2.5%. WTC too charged ahead as economies and logistics chains reopen up 5.9%. In corporate news, BLX shone the light on how to sell stuff digitally, rising up 22.6%, CAR also revved up after a positive update rising 6.2%. CDA too gave investors something to cheer pointing to record profits and rallied another 13.7%. Nothing significant in economics and the 10-year bond steady at 0.90%. Asian markets slightly weaker with Japan down 0.4% and China down 0.23%.

Today’s Highlights

• ASX 200 finally up 49.5 points to 5992.
• High 5992 Low 5931. Narrow range. Strong close.
• Big Bank Basket bought back up to $125.86
• All Tech Index surges 2.32%.
• Dow Futures down 33 points.
• 10-year bond yields steady at 0.90%
• AUD steady falls to 68.94c
• Aussie gold rises to $2507.
• Bitcoin slips to US$9449.
• Asian market softer with Japan down 0.4% and China down 0.23%.

STOCKS

• MAQ +13.40% great run. Only 17,000 shares traded.
• AEF +11.43% back in favour.
• CUV +8.08% great move higher. News?
• PBH -4.93% profit taking hits.
• DEG -6.56% profit taking.
• FLT -2.62% WEB -3.17% CTD -2.98% travel still an issue to Australia.
• BLX +22.61% earning update. Digital transformation shines the way.
• GEM -2.11% AGM comments.
• ZNO +10.29% CV19 measures help.
• GLL +31.11% Glenaras gas project update.
• A2M +7.79% cream rises.
• NVX -6.33% some profit taking.
• PET -4.05% downgrade hurts.
• MP1 -3.93% Digital Reality sells down 5% at 1336c.
• SPL +8.96% DEP lutetium effective.
• CDA +13.66% sales rebound to record.
• AIA +3.93% traffic numbers down 94.7% in May YoY.
• CSL +1.11% CFO resigns to go to BHP.
• STO +1.47% Narrabri in focus.
• IFN +7.32% scraps distribution plans. Get T/O offer
• CAR +6.19% guidance, fall in revenue.
• JIN – trading halt. Waiting for WA news.
• FPH +5.33% defensive buying back in.
• Speculative Stock of the Day: No stand outs.
• Biggest Rises: CDA, MAQ, RED, AEF, OPT, CUV, A2M and IFN.
• Biggest Falls: PRU, DEG, PLS, MYX, PBG, MGX and MP1.

TODAY

• Ansell (ANN) +0.88% Continues to see elevated demand for a range of products. Working to optimise and expand manufacturing and distribution capacities. Magnus Nicolin has agreed to delay his retirement and stay in the CEO role for a further six months.
• GDI Property Group (GDI) +2.61% Reports H2 estimated distribution of 3.875c/security.
• carsales.com (CAR) +6.19% Guides FY20 Adjusted NPAT $134-138m vs consensus $110.3m. Adjusted Revenue expected to be between $419m-423m. Adjusted EBITDA expected to be in the range of $228m-232m. In Australia, overall lead and traffic volumes have continued to improve as social distancing measures have been eased. Total inventory has fallen over the last 6-weeks on the back of factors relating to COVID-19.

• BHP Group (BHP) -0.72% CFO Peter Beaven to step down on November 30. David Lamont appointed as his replacement.
• CSL Limited (CSL) +1,.11% CFO David Lamont to resign on October 30. Lamont leaves CSL to pursue a career opportunity with another global ASX listed company.
• Jumbo Interactive (JIN) – Requests voluntary suspension from quotation pending an announcement in relation to its re-seller operations in WA.
• Beacon Lighting (BLX) + 22.61% Year to date (14-June) total sales growth of 15.5% vs year ago. Company stores comparative sales growth of 16.9% and online sales growth of 77.7% over the same period. Expects FY Underlying NPAT will be greater than last year.
• G8 Education (GEM) –2.11% AGM comments. Booked occupancy is currently ~65%, with physical attendance at ~53%. The gap between booked and attendance is expected to continue to narrow. As announced on 11 June the group expects to recognise an impairment charge in its CY20 half-year results of between $230m and $250m. This follows a review of the impacts of the COVID-19 operating environment which has exacerbated the challenging industry supply environment that has been in place for the past 12 – 24 months.
• APN Convenience Retail REIT (AQR) -0.30% Completes $50m placement at 320c.

ECONOMIC NEWS

• ANZ has upgraded its GDP forecast for this year to a decline of 2% from its previous −4.7%, before rising 1.8% in 2021.

COVD-19 NEWS

• NZ Prime Minister Jacinda Ardern has called in the military to enforce border controls after two women who arrived from the U.K. were allowed to leave quarantine early.
• The U.S. FDA and CDC both brushed aside concerns about risks of coronavirus transmission from consuming or handling food, after new infections in Beijing were blamed on imported salmon.
• Brazil reported a record 34,918 new infections, bringing the total to 923,189. The data compiled by Brazilian states also showed 1,282 new fatalities, pushing the total toll to 45,241.
• Coronavirus cases in the U.S. increased by 20,405 from the same time yesterday to 2.12m. Deaths rose 0.6% to 116,567. The reason is more testing according to some.
• Boris Johnson hails UK science breakthrough on treatment.
• Beijing has ordered all schools to close in an escalation of containment measures.

BONDS

ASIAN NEWS

• The Japanese trade surplus with the U.S has fallen to a record low as CV19 freezes demand for Japanese cars. The surplus dropped 97% in May from a year ago to 10bn yen ($96m), the lowest in data going back to 1979. The result was driven by a halving of exports to the U.S., the biggest fall since March 2009, with car shipments leading the way after a 79% slide.

EUROPEAN NEWS

• The Trump De Luxe package to the GOP convention is a mere US$1.2m. At least that is a couple. The Presidential Trust gives you “Special Trump Victory hospitality,” including ‘lounge” benefits, priority seating and a behind-the-scenes tour. If you want to be a cheap skate, you can go the Mike Pence package for US$580,600. The cheapest packages start at US$1,000 and gets you a hotel room, access to the convention and ‘hospitality’ during the week. The event will take place in Jacksonville Florida from August 24^th -27^th.
• Dr Fauci is calling for action to prevent a CV surge.
• Powell warns of significant uncertainty of the US recovery.
• Sanofi will build a vaccine plant and research centre in France investing EUR 610m.

And finally…

A policeman on a motorcycle pulls over a car. ‘What’s up?’ says the driver. ‘Your wife fell out the passenger door three miles back,’ says the policeman. ‘Thank goodness for that,’ says the driver. ‘I thought I’d gone deaf.’

Husband: Want a quickie? Wife: As opposed to what?

A man is getting into the shower just as his wife is finishing up her shower, when the doorbell rings. The wife quickly wraps herself in a towel and runs downstairs. When she opens the door, there stands Bob, the next-door neighbour.

Before she says a word, Bob says, “I’ll give you $800 to drop that towel.” After thinking for a moment, the woman drops her towel and stands naked in front of Bob. After a few seconds, Bob hands her $800 and leaves. The woman wraps back up in the towel and goes back upstairs. When she gets to the bathroom, her husband asks, “Who was that?” “It was Bob the next door neighbour,” she replies.

“Great,” the husband says, “did he say anything about the $800 he owes me?”

 

Moral of the story: If you share critical information pertaining to credit and risk with your shareholders in time, you may be in a position to prevent avoidable exposure.

Clarence

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