The ASX 200 grinds higher finishing the day up 30 points to 6132 (0.5%). Dow futures down 10. After a conviction-less start, the market took heart from Asian markets and especially a good rally in China to push ahead. Banks as usual were the driver with the Big Bank Basket up to $125.13. CBA rose 1.3% and WBC up 1.9%. Not much else happening in insurers but a bid for LNK and BVS making a UK acquisition helped sentiment. Miners though missed out with BHP down 0.4% and RIO down 0.9%. Gold miners formed on bullion price increases, NCM up 1.7% and CHN up 17.0% after a Diggers presentation. Industrials were a mixed bunch, tech showed some gains in the BNPL with Z1P up 5.7% ahead of potentially good results tomorrow. APT put on 2.8% and XRO up 1.3% with the All Tech Index up 2.29%. In corporate news, CSR up 1.1%, after selling Horsley Park Land for $84.3m. ORI off 3.2%, takes $170m hit, sees earnings above $600m. BAP up 3.1%, Q1 revenue up 27% vs year ago. CWY down 2.6% on NSW EPA letter. LNK received a $2.8bn bid from PE with the stock up 25.1% and Aware Super has lobbed another bid at OPC with UWL down 7.2% on the news and the target up 9.1%. Nothing in economic news today, 10-year yields fall to 0.84% and the AUD firm at 72.22c. Asian markets see Japan down 0.3%, China powering ahead up 2.4% and HK up 2.1%.

Today’s Highlights

  • ASX 200 added 30 to close at 6132. Six in a row.
  • High 6132 Low 6093. Below average volume. ASX web site crashes.
  • Big Bank Basket rallies hard to $125.13
  • All Tech Index up 2.29%.
  • 14 trading days until the US election.
  • Dow Futures down 10.
  • Gold rallies to AUD$2670
  • 10-year bond yield slips to 0.84%
  • AUD rallies to 72.22c
  • Bitcoin up to US$11,390.
  • Asian markets see Japan down 0.3%, China powering ahead up 2.4% and HK up 2.1%.

STOCKS

  • CHN +17.00% Diggers and Dealers presentation
  • BVS +8.88% Delta Financial acquisition
  • OPC +9.06% Asure bids again.
  • LNK +25.06% private equity bid.
  • AD8 -1.49% MS upgrade.
  • PLS – production increases to 62,404 tonnes.
  • Z1P +5.69% running into results.
  • MYQ – capital raising at 120c with 1:1 option at 160c.
  • ASX +0.04% web site crashes on redesign.
  • CWN -2.00% Vic Gaming Commission questions.
  • PLL -3.74% change in substantial holding
  • WHC -5.74% Coal back on the nose.
  • CWY -2.61% Appendix 3Y.
  • CAN -9.52% Aurora Cannabis sells ownership
  • POS +15.62% DHEM targets expands Golden Swan potential.
  • EEG +22.39% shale gas intercepts.
  • PM8 +14.34% study into UK rare earths project.
  • GGG +14.043.45% Livewire write up perhaps?
  • EVT -% sale of Cinestar transaction update.
  • Speculative Stock of the Day: Azure Minerals (AZS) +61.70% Drilling has intercepted massive nickel suplhides at Andover.
  • Biggest Winners: LNK, CHN, RBL, OPC, BRN, BVS and DEG
  • Biggest Losers: VGI, UWL, WHC, PPC, LOV, PLL and EVT..

TODAY

  • Lendlease Group (LLC) -1.00% LLC and Aware Super acquire 90% interest in 2.6-acre site at 1 Java Street in Brooklyn, New York. The site has an estimated end development value of $1bn, the major urbanisation project will transform a full city block into ~800 residential for rent apartments. The acquisition is based on a 25% interest for Lendlease and a 75% interest for Aware Super. Newswires speculate Lendlease and Aware paid about US$100m for the stake.
  • Bravura Solutions (BVS) +8.88% To acquire Delta Financial Systems for up to $41.5m.Delta is a UK software company that provides technology to power complex pensions administration in the UK market. The transaction is expected to be completed by the end of October 2020 subject to regulatory approvals.
  • Ramelius Resources (RMS) +0.46% In FY21 sees gold production between 260-280koz at an AISC of $1,230-$1,330/oz. Capital spend expected in the range of $55-65m and exploration capex $25-30m.
  • Evolution Mining (EVN) +3.73% Preliminary Q1 gold production of 170,021oz at AISC of $1,198/oz. Operating mine cash flow of $272.3m. All metrics are tracking ahead of its FY21 plan. Numbers exclude any contribution from Cracow which was divested on July 1.
  • Cleanaway (CWY) -2.61% NSW EPA reports ‘consistent areas of concern’ following inspection of a number of Cleanaway sites. The EPA reportedly inspected 26 sites in late June and as a result, has issued a number of licence conditions, show cause notices, warning letters and advisory letters to the company. The article notes that out of the 26 sites only one was given a “no action” finding.
  • Bapcor (BAP) +3.15% Q1 trading update; revenue up 27% vs year ago. CEO comments, “Bapcor expects to deliver a strong first half, however, the 2nd half remains unclear, and given the current economic uncertainties and any potential government restrictions,is not in a position to provide a forecast of earnings for the current year. “
  • CSR (CSR) +1.08% Sells 8.6 hectares of land at Horsley Park, NSW for $84.3m. The sale is expected to generate property EBIT of $48m.
  • Orica (ORI) -3.24% Expects FY EBIT to be slightly above $600m.Expects to recognize $170m (pre-tax) costs in its FY20 results. Sees H2 ammonium nitrate volumes 15% below expected pre-COVID-19 volumes vs prior guidance of down 10%-15%. Higher supply chain costs, largely freight, continue to impact the business.
  • Link Group (LNK) +25.06% receives a conditional, non-binding offer from Pacific Equity Partners and Carlyle Group consortium of 520c/share, in cash. Perpetual (PPT), which currently holds 9.65% of Link Group, has sent a letter to the Consortium, stating that it intends to vote in favour of the offer. Major shareholder holder Yarra Capital has told newswires that the company should wait for a better offer as it is currently undervalued.
  • Crown Melbourne (CWN) -2.00% Receives ‘Show Cause’ notice from the Victorian regulator relating to compliance with its internal control statement (ICS) for junket operations.
  • CBA (CBA) +1.33% Advises that temporary loan repayment deferrals due to COVID-19 now stand at $42bn vs month-ago $59bn.Further significant reductions are expected as initial temporary repayment deferrals continue to expire through October
  • LiveHire (LVH) +3.23% Appoints Ben Brooks as CFO. Brooks past experience extends across AUSTAR, Foxtel, oOh! Media and Solotel

ECONOMIC DATA

  • Nothing new today

COVID – 19 NEWS

  • New Zealand agreed to purchase enough vaccines from Pfizer Inc. and BioNTech SE for 750,000 people.
  • South Korea added 97 cases in 24 hours and the  death toll rose by one to 433.
  • A small cluster of CV19 cases has broken out in the port city of Qingdao with 12 now so far identified.
  • Dr Fauci has responded to GOP adverts saying he was taken out of context praising the response of POTUS.
  • UK will announce a new set of restriction on Monday. England will be divided into areas of “medium,” “high” and “very high” alert.
  • Brazil reported 290 virus-related deaths in its latest daily count, the fewest since April 5th.
  • India on track to surpass the US with infection rates.
  • China’s north eastern city of Qingdao will test its entire population of 9m people for COVID-19 after a rise in new infections.

BONDS

ASIAN NEWS

  • The People’s Bank of China has fixed the midpoint for the Chinese yuan at its strongest against the US dollar since April 2019.
  • China could be on the verge of further opening up China’s economy to foreign investment. A report in the official Xinghua News Agency suggested that Beijing may announce a “socialist pilot zone with Chinese characteristics” in the southern city of Shenzhen over the next five years. President Xi is set to visit Shenzhen later this week.
  • Chinese equities listed in Hong Kong have underperformed their mainland peers all year, with the Hang Seng China gauge still down 12%.
  • In China, financial institutions no longer need to set aside cash when purchasing foreign exchange for clients through currency forwards, according to a statement from the PBOC on Saturday. Banks previously had to hold 20% of sales on some foreign exchange forward contracts, a move from two years ago.
  • Singapore and Indonesia are looking at establishing a reciprocal green lane for travel between the two countries. A Green Lane will enable cross-border travel for essential business and official purposes.
  • HK’ Carrie lam has delayed her policy address, now expected before the end of November.

EUROPEAN AND US HEADLINES

  • EU is looking to expand its powers again giant digital platform stocks.
  • Trump has claimed immunity from CV19. Despite threats otherwise Chinese IPOs in the US have increased in the last few years.
  • US markets curtailed by Columbus Day. Bonds closed. Equity open.

And finally…

Clarence

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