HAPPY NEW FINANCIAL YEAR
The ASX 200 added 36.5 points to 5934 (0.35%) as the new year kicked off on a positive note. Dow futures down 100 points. After a promising morning of grinding out gains the enthusiasm waned especially in healthcare with CSL falling 0.9%, FPH giving back some recent gains down 3.3%. Banks though held the market up with the Big Bank Basket up to $125.60. CBA lagged only 0.7% to the good as WBC rose 1.8% and NAB rose 1.9%. Other financials were once again in the frame with MQG up 1.8% and MFG up 1.9%. Miners sagged with BHP unchanged and FMG falling from its pedestal down 0.65%. Industrials were mixed, TCL up 1.2% and COL down 1.6% and WOW down 1.0%. REITs held firm and tech stocks were in favour especially the cloud with NXT up 8.1% and MP1 up 7.4%. More craziness in small and speculative stocks as ESK fell 40.3% after being up over 100% at one stage and ATH rose 871.0% after being up twice that at one stage on a Phase 2 trial pathway. In corporate news, AIA fell 2.8% on an update, MMM dropped 7.0% on a change in substantial holding, JIN bounced hard after an insto shareholder looked it has done its sell down, up 5.6%. On the economic front, building approvals took some of the wind out of the confidence with the 10-year yield at 0.92% and the AUD at 68.89c. In Asian markets mixed, Japan fell 0.80% and China up 1.25%.
- ASX 200 rallies 36.5 points to 5934 (0.6%) as New Year hangover bites.
- High 5954 Low 5893. Average volume.
- Big Bank Basket rallies hard to $125.60
- All Tech Index up 1.3%
- 86 trading days until the US election.
- Dow Futures down 100
- 10-year bond yields rises to 0.92%
- AUD steady at 68.89c
- Aussie gold steady at $2590.
- Bitcoin steady at US$9147
- In Asian markets mixed, Japan fell 0.80% and China up 1.25%.
- EOS +13.68% defence spending increase.
- ESK -40.29% soars and falls. Range was crazy. 370-104c. Rational left the building.
- DTL +8.37% some catch up.
- PBH +7.55% signs of US life.
- NXT +8.10%, MP1 +7.37% cloud stocks take off.
- WTC -4.13% still heavy after Wise sell down.
- AVH -2.44% NASDAQ commencement
- TPG -3.93% becoming a substantial shareholder.
- TLX +16.80% FDA breakthrough designation.
- MYR +18.92% short covering.
- SZL +13.03% rally continues.
- KLL +13.79% resource update.
- CKF +0.32% broker upgrades.
- SWM +9.89% new year buying.
- RIO -0.83% management changes.
- MDR +11.00% US deal.
- DEG +10.50% keeps on going.
- RED +15.00% media speculation.
- PET -1.64% director selling.
- Speculative Stock of the Day: Alterity Therapeutics (ATH) +879.59% response to ASX query after US FDA provides a pathway to development of its Multiple System Atrophy (MSA) a Parkinson disorder. A non-clinical Phase 2 trial beckons. Still a long way to go.
- Biggest Rises: EOS, HUB, DEG, PAR, DTL, NXT, PLS, CTD and PBH.
- Biggest Falls: WTC, SUN, COE, TPG, RBL and ALD.
- Temple & Webster Group (TPW) – Launches fully underwritten $40m placement priced at 570c/share. Expects FY20 EBITDA to exceed $8m vs consensus $8m. Funds will be used to provide financial flexibility and to pursue growth initiatives taking advantage of the significant structural shift towards online shopping. Strong trading has continued with June gross sales (to the 28th June) up 130% vs year ago.
- Suncorp Group (SUN) -4.12% Expects the impact from COVID-19 on FY20 profit and loss (P&L) to be broadly neutral, excluding investment market movements and bank impairment losses. Announces a new operating model and organisational structure to accelerate the group’s digital and data-driven transformation. Appoints Clive van Horen as new Banking & Wealth CEO. FY21 main catastrophe reinsurance program finalised with a similar structure to previous years. FY21 natural hazard allowance is expected to increase by US$90M to US$130M vs US$820M in FY20.
- NextDC (NXT) +8.10% Contracted commitments at its NSW data centre facilities have increased by ~4MW, to more than 36MW. Contracted customer commitments plus expansion options at its NSW data centres are now approaching 60MW. MD and CEO Craig Scroggie said, “the demand for our data centre services continues to accelerate and exceed our expectations.”
- Oil Search (OSH) +0.63% 2020 production costs expected to be US$10.50/boe vs prior guidance of US$11-12/boe. Full-time workers have been reduced from 1,649 people in March to 1,222, representing a fall in the total workforce of ~34%. Currently reviewing all capital and development projects to identify cost-saving initiatives.
- AMP (AMP) +1.62% Completes sale of life insurance business to Resolution Life for $3bn.
- Flight Centre (FLT) +3.15% Secures debt facility of up to £65m via the Bank of England’s. The debt facility will be drawn to help offset the coronavirus’s impacts on its United Kingdom business.
- Lendlease Group (LLC) -1.29% Expects FY20 core profit between $50-150m. Unaudited statutory loss expected to be in the range of $230-$340m. Engineering exit costs of $550m anticipated, with $525m expected to be accounted for in FY20. Gearing expected to be below 10% and total liquidity above $5bn on June 30. Development JV to deliver the first residential tower at One Sydney Harbour anticipated to contribute ~$100m to FY21. Performance of the Construction segment was impacted by COVID-19 in all regions. The impact was greater in its international regions, particularly in cities where mandated shutdowns were implemented.
- Beston Global Food (BFC) –unchanged- FY20 total tonnage of mozzarella in FY20 is likely to be around 9,100 tonnes, double the production in FY19. This has been achieved with an 8% increase in milk supply to 111ML. In FY21 expects to complete the sale of its dairy farms for $40.4m and increase milk supply to ~135 ML, up from 111 ML in FY20.
- Helloworld (HLO) +4.37% Sells its Los Angeles based travel wholesale business to Down Under Answers. Neither the sale price or the business are considered material.
- Home Consortium (HMC) – Launches $140m placement and $30m SPP priced at 288c/share. To acquire three Woolworths centres for $127.8m and Aurrum Erina residential aged care property for $32.59m on a sale and lease back. Notes acquisitions are immediately funds from operations (FFO) accretive and result in FY21 FFO guidance of at least 15c/security. Intends to declare a final FY20 dividend of 7.5cps, fully franked.
- The Star Entertainment Group (SGR) +4.93% Trading performance at The Star Sydney in June improved over the month as permitted capacity and visitation increased. Since mid-June, average daily slot and table gaming volumes have been comparable with H1 FY20 private gaming room levels.
- Building approvals fall 16.4% in May, following a 2.1% fall in April and vs market expectations of a 10% drop.
- China’s Caixin Manufacturing PMI has surprised expectations in June, with manufacturing activity rose to 51.2 from 50.7 in May, surprising expectations for a 50.5 number. The increase was driven largely by new orders, which hit its highest level since December 2019.
- Beyond Meat is heading for the Chinese consumer as its products hit the supermarkets there. It will begin selling its plant-based burger in the frozen section of 50 Freshippo stores in Shanghai this weekend.
- The IMF predictions for the Asian region. Asia’s economic output in 2022 forecast to be about 5% lower compared with the level predicted it before the crisis.
- China draws condemnation for new HK laws.
- Sainsbury general sales up 7.2%.
- Fauci says new cases could hit 100,000 a day.
- Global deals drop to lowest levels in a decade.
- US companies file for bankruptcy at fastest pace since 2013. What happened in 2013?
Husband: Want a quickie?
Wife: As opposed to what?
An 85-year-old man was requested by his doctor for a sperm count as part of his physical exam.
The doctor gave the man a jar and said, “Take this jar home and bring back a semen sample tomorrow.”
The next day the 85-year-old man reappeared at the doctor’s office and gave him the jar, which was as clean and empty as on the previous day. The doctor asked, what happened and the man explained.
“Well, doc, it’s like this–first I tried with my right hand, but nothing.
Then I tried with my left hand, but still nothing.
Then I asked my wife for help. She tried with her right hand, then with her left, still nothing. S
he tried with her mouth, first with the teeth in, then with her teeth out, still nothing.
We even called up Arleen, the lady next door and she tried too, first with both hands, then an armpit, and she even tried squeezin’ it between her knees, but still nothing.”
The doctor was shocked! “You asked your neighbour?” The old man replied, “Yep, none of us could get the jar open.”