The ASX opened firm but drifted off as Victorian cases hit records and economies and State governments hit the brakes, before a late surge saw us close up 23 to 6034 (0.4%). For the week, the ASX 200 rose from 5919 to 6034, up 115-points or 1.94%. Banks rallied into the close with the Big Bank Basket modestly higher at $127.06. Other financials saw some late buying, MFG down 0.9% though MQG up 0.3%. Miners better though led by BHP up 0.4% and RIO after  post ing a quarterly in line with expectations, up 0.6%. FMG looking good again up 1.7%. Gold stock went nowhere today as AUD bullion prices slipped slightly, NCM down 0.4%, DEG down 6.6% though as selling contines. Healthcare better as some rotation seems to be happening CSL up 0.7% and FPH up 0.2%. In industrials, TCL rose 1.7%, BXB up 1.9% and A2M rose 2.4% as cream rose. Tech stocks had a softer session as APT fell 0.1%, the other BNPL stocks swooned and then found buyers, SZL had a range of 591c to 707c closing up 5.2%. The wild ride continues too for Z1P falling 0.7%. The All Tech Index fell 0.1%. In corporate news, BWX rose 18.6% after completing its $40m placement at 340c. HLO not so lucky, down 2.0% after its $41.6m raising. BSL down 1.3%, guides FY20 EBIT to be around $560m vs $1.35bn in FY19. Expects $200m hit to its ANZ/Pacific assets. No economic data today. The 10-year bond yield steady 0.86% and the AUD steady just below 70c. In Asia China dropped 0.3% rallying off lows and Japan down 0.5%

Today’s Highlights

  • ASX 200 rises 23 to 6034 in late surge. Low volume low volatility.
  • High 6042 Low 5999. Narrow range.
  • Big Bank Basket $127.06
  • All Tech Index down 0.1%
  • 75 trading days until the US election.
  • Dow Futures up 34.
  • 10-year bond yield steady at 0.86%
  • AUD steady at 69.88c
  • Aussie gold firms to $2575.
  • Bitcoin becalmed at US$9089
  • In Asia, China dropped 0.3% rallying off lows and Japan down 0.5%

STOCKS

  • CWP +1.4% talks 58% profit fall.
  • RIO +0.61% positive quarterly
  • SZL +5.16% reverses early losses as SPP opens.
  • PBH +6.62% bounce continues.
  • ALK +4.64% demerger cheers.
  • AWC +4.35% broker upgrade on Alcoa result.
  • TPW -9.30% profit taking.
  • DEG -6.62% selling continues.
  • AVH -4.78% US move not popular.
  • KGN -4.66% finally some selling as potential fines.
  • EVT -3.54% lockdowns bite.
  • RAC -7.94% profit taking.
  • BWX +18.58% well supported capital raise.
  • BET +12.64% still fans betting on higher prices.
  • OPY +10.00% recovery after early losses.
  • QAN -2.16% FLT -2.79% travel stocks wilt.
  • Speculative Stock of the Day: Pursuit Minerals (PUR) +116.67% option acquired for a 244,000 oz high grade gold project in Arizona. The company has paid US$20k for exclusivity with another US$75k in cash on exercise.
  • Biggest Rises: PBH, ABP, SZL, ALK, AWC, HUB and S32.
  • Biggest Falls: TPW, DEG, AVH, KGN, GMA, SM1, LIC and EVT.

TODAY

  • Rio Tinto (RIO) +0.61% Q2 Pilbara iron ore shipments 86.7Mt vs consensus 86.5Mt. Pilbara iron ore production up 4% to 83.2Mt vs year ago. Mined copper 132.8Kt vs consensus 108.4Kt. Guides 2020 capex of US$6bn vs prior guidance of US$5-6bn. Pilbara iron ore unit cost guidance is expected to be within the previous guidance of US$14-15/tonne, including unplanned one-off COVID-19 costs of US50c/tonne mostly incurred in H1 of 2020. Copper C1 unit cost guidance remains unchanged at US120-135c/lb.
  • Helloworld (HLO) -1.99% Completes placement and institutional entitlement offer, raising $41.6m at 165c/share.
  • Cann Group (CAN) -12.20% Launches $14.3 placement and $10m SPP at 40c/share. Expects revenues of $15m in FY21.
  • BWX (BWX) +18.58% Completes $40m institutional placement at 340c/share.
  • NAB (NAB) +0.17% There is speculation PE interest in NAB’s MLC may be subsiding, with a lack of short-term cash flow believed to be of concern for the business. PE firms are believed to be uninterested in the advice component of the business but that NAB is not keen to break up the asset.
  • Bluescope Steel (BSL) -1.32% Guides FY20 EBIT to be around $560m vs $1.35bn in FY19. At Australian Steel Products, domestic demand remained resilient with despatch volumes (ex-mill) similar to that of H1 FY20. The Building Products Asia & North America segment delivered a preliminary result close to H1 FY20. At North Star, the weak demand environment from mid-March to mid-May placed downward pressure on realised prices and spreads. Currently reviewing the carrying value of the New Zealand and Pacific Steel segment, expected to result in an impairment of around $200m. At the beginning of 1H FY2021, steel spreads in North America and Asia are lower than 2H FY2020 averages. While at this point orders and despatches in Australia remain stable and North Star is despatching near full capacity, there is a high level of uncertainty in the current environment.
  • Westpac (WBC) +0.45% Facing a class action filed by Maurice Blackburn relating to the payment of “flex commissions” to auto dealers pursuant to automobile finance agreements during the period 1 March 2013 to 31 October 2018.
  • Kogan (KGN) -4.66% Federal Court upholds ACCC allegations that KGN breached the Australian Consumer Law in regards to Jun-18 promotion.

ECONOMIC NEWS – No new data but economic snapshot.

COVID-19 NEWS

  • India exceeds 1m cases.
  • Students from Europe are exempt from the U.S. coronavirus travel ban.
  • Tourists from Hong Kong entering Shenzhen will be required to show a negative nucleic acid test completed within 72 hours.
  • Brazil reported 45,403 new cases of Covid-19 in a 24-hour period, pushing the number of infections to more than 2m. Brazil has added 1m cases in less than a month in a rapidly shifting outbreak.

BONDS

ASIAN NEWS

  • Singapore’s exports rebounded in June at a faster rate than expected, with Non-oil domestic exports jumping 16.1% from the same time in 2019, exceeding the highest forecast in the Bloomberg survey. The exports rose 0.5% from May against a median estimate for a 4.6% contraction.

  • Chinese authorities have been attacking its biggest stock in Moutai as they have berated Moutai for being the currency of corruption. Apparently Moutai is used for bribes and the stock fell heavily after a record breaking 50% rise this year.

EUROPEAN NEWS

  • European markets to open slightly higher.
  • Virgin Atlantic takes to the skies thanks to Richard Branson and a hedge fund.
  • US Attorney general says Apple and Disney are Chinese pawns.
  • Global debt has soared to 331% of global GDP. A new record.
  • US consider ban on TikTok.
  • FBI launches investigation into Twitter hack.

And finally…

An elderly, wealthy woman was boring fellow beachcombers as she bragged on and on about her two remarkable grandchildren.

Unable to stand it any longer, a fellow sunbather interrupted her.

“Tell me, how old are your grandsons?”

The grandmother gave a grateful smile and replied: “Well, the doctor is four and the lawyer is six”.

 

 

A junior executive had been complaining to his wife of aches and pains, but neither one could account for his trouble.

Arriving home from work one night, he informed her: “I finally discovered why I’ve been feeling so miserable. We got some ultra-modern office furniture two weeks ago, and I just learned today that I’ve been sitting in the wastebasket.”

 

 

A married man left work early one Friday afternoon. Instead of going home however, he squandered the weekend (and his pay cheque) partying with the boys.

When he finally returned home on Sunday night, he ran into a barrage of abuse from his furious wife. After a couple of hours of nagging and berating, his wife asked: “How would you like it if you didn’t see me for a couple of days?!”

“That would suit me just fine!”

Monday went by and the man didn’t see his wife. Tuesday and Wednesday came and went with the same result. Come Thursday, the swelling went down a bit and he could see her a little, just out of the corner of his left eye!

 

Clarence

XXXX

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