The ASX tried hard to rally but closed down 18 at 6679 (-0.3%) after early gains in banks were negated by falls in miners. Dow futures down 13 points. The Big Four Basket rose to $153.88 with CBA up 0.8% and insurers faring better on rising rates SUN up 3.0% and IAG rising 2.0%. Miners though on the nose as BHP fell 1.1%, RIO down 0.8% with FMG off 0.3%. Gold and energy flatlining too as healthcare sank as the sell off in CSL down 1.0% and COH down 1.4% continues. Tech was the other area under pressure, APT dropped 1.9%, XRO down 2.3% and the All–Tech Index down 0.8%. Rising bond yields not helping valuations. In corporate news, PNV down 13.0% on its H1 sales update, after slower than expected sales in October. Management noted COVID-19 headwinds are likely to hamper sales in the near term. SZL up 2.7%, December 2020’s annualized underlying merchant sales of $1.36bn was well ahead of the company’s year-end run rate goal of $1.0bn. ALU down 2.1%, H1 unaudited revenue $89.6m vs consensus $90.2m. Management noting a challenging first half. NEA up 3.5% on a broker upgrade. In economic news, Weekly ANZ Roy Morgan Consumer Confidence index fell 0.1% to 108.9. For the third year in a row, consumer confidence has begun the year on a flat/downbeat note compared to the pre-Christmas level. Lockdown measures in QLD and border closures likely weighing. The 10-year yield rising to around 1.14%, AUD dips below 77c, just. Asian markets turn higher with Japan up 0.1% and China rallying 1.1%.

Today’s Highlights

  • ASX 200 down18 points to 6679. Rally fades as miners weigh.
  • High 6733 Low 6685. Volume a little summer holiday affected.
  • Big Bank Basket rises to $153.88
  • All Tech down 0.8%
  • Dow Futures down 17 points.
  • Gold rises to AUD$2404
  • 10-year yield lifts to 1.14%
  • AUD down to 76.99c
  • Bitcoin back to $34779 after topping $40,000.
  • Asian markets turn higher with Japan up 0.1% and China rallying 1.1%.

STOCKS

  • TYR -8.25% outages continue.
  • RIO -0.81% big trouble in little Mongolia again.
  • PNV -12.98% disappointment reins on update.
  • SUL +5.47% broker upgrade.
  • AVH +15.26% switch from PNV after presentation well received.
  • SZL +2.72% merchant sales up 205%.
  • SOR +31.88% off to the races on tech trigger.
  • 4DS +17.24% buyers back.
  • SYR -4.87% PLS -6.31% GXY -8.71% lithium slump.
  • ASM +15.22% on a roll.
  • NEA +3.50% broker upgrade.
  • NVX +10.10% stringing gains together.
  • IPO of the Day: Felix (FLX) -2.78%
  • Speculative Stock of the Day: Acrux (ACR) +30.30% after FDA approval for its generic testosterone solution.
  • Biggest Winners: ASM, NVX, ARB, HMC, SUL, AVZ and RBL.
  • Biggest Losers: BCK, PNV, GXY, TYR, BRN, CVN and JMS..

TODAY

  • MACA (MLD) – 7.64% Completes retail entitlement offer raising $12.5m at 102c/share.
  • Paladin Energy (PDN) -4.92% Repeats expected FY21 total expenditure of US$9.5m, down 44% vs year ago.
  • Plenti Group (PLT) +5.53% Q3 loan originations $130.9m, +58% vs year ago. Total loan portfolio increased to $508m, +46% vs year ago. Loan portfolio continues to demonstrate solid credit performance, with low levels of losses and 90+ day arrears declining to 0.32%. CEO noted the outlook for Q4 and rest of 2021 is very positive.
  • Altium (ALU) -2.11% H1 unaudited revenue US$89.6m vs consensus US$90.2m. Management Comments: “despite a challenging H1, we saw signs of recovery in Q2. This result was achieved despite extreme conditions in the US and the restructuring of our sales organization. I am confident that with our pivot to the cloud and our move to digital sales that the Q2 momentum will continue into H2.” Altium remains confident that it will deliver a stronger H2 with growth in the Americas, China and NEXUS and maintains full year guidance (ex-TASKING).
  • Sezzle (SZL) +2.72% Q4 underlying merchant sales (UMS) of $320.8m, +40.6% vs quarter ago. Merchant fees $17.2m, +32.6%, active customers 2.23m, +24.5% and active merchants 26,690, +27.8% vs quarter ago. December 2020’s annualized UMS of $1.36bn was well ahead of the company’s 2020 year-end run rate goal of $1.0bn.
  • Polynovo (PNV) – 12.98% H1 sales +31% vs year ago.Slower than expected sales in October. November December sales exceeded budget in US, NZ, and Taiwan. Opened 35 new accounts across all direct markets. In the 2020 calendar year, opened 109 new accounts +89% vs year ago. United States Q1 sales +70% and Q2 sales +16% vs year ago. Year to date BARDA revenue lower than anticipated due to the delay in obtaining US FDA IDE approval. Recruitment of patients now scheduled for late Q3 FY21 and will be reflected in increased revenue. Managing Director, Paul Brennan said, “In the short-term forecasting sales will be challenging particularly in the US, however, the medium-term outlook is strong, and we continue to see surgeons using and referring NovoSorb BTM to their peers. Once hospitals have more capacity, we will see US and UK sales accelerate just as we have seen in New Zealand and Australia. New geographies offer good opportunities for NovoSorb BTM.”
  • ARB +5.75%H1 unaudited sales revenue $284m, +21.6% vs year ago. Q1 unaudited profit $70-72m, inclusive of $9.8m of non-recurring government benefit. The company maintains a positive short-term outlook based on a strong customer order book and another record sales month in December 2020.
  • Schaffer Corp. (SFC) +7.37% Expects H1 statutory profit of $22m vs year-ago $13.9m. Includes $10m non-cash, unrealised gains on equity investments. The majority of the unrealised, noncash profit is associated with the Group’s listed investment in Harvest Technology Group. Expects to pay a fully franked FY21 interim dividend of 45c.
  • BlueScope (BSL) –1.90%Appointed Connell Zhang as Chief Executive NS BlueScope. He will join the Company’s Executive Leadership Team and lead its joint venture operations across ASEAN and North America.
  • Pushpay (PPH) +2.68% Lifts full-year EBITDA forecast to US$56-$60m from US$54-58m.

ECONOMIC NEWS

  • Weekly ANZ Roy Morgan Consumer Confidence index fell 0.1% to 108.9. For the third year in a row, consumer confidence has begun the year on a flat/downbeat note compared to the pre-Christmas level. Lockdown measures in QLD and border closures likely weighing.

BONDS

COVID – 19 NEWS

  • From Jan 18, almost all people entering New Zealand will need to be tested for the virus within the first 24 hours of arrival.
  • South Korea reported 537 new cases over the last 24 hours.
  • The Japanese government will declare a state of emergency for Osaka, Kyoto and Hyogo.
  • Portuguese President Marcelo Rebelo de Sousa tested positive for Covid-19 late on Monday.
  • Malaysia’s king declared a state of emergency.

ASIAN NEWS

  • Chinese President Xi has told a gathering that he saw “opportunities in general outweighing challenges.” The Centre for Economics and Business Research last month has forecast that China would overtake the U.S. as the world’s largest economy in dollar terms in 2028, five years earlier than a year ago.
  • Softbank has sold around US$2bn of Uber stock at an average price of $53.46.

EUROPEAN AND US HEADLINES

  • Morgan Stanley has changed their USD expectations for a weakening as interest rates continue to climb in US Treasuries.
  • Trump and Pence have little chat and signal POTUS will not resign or be removed, until January 20th at least.
  • Ford will cease making cars in Brazil after a century there. 5000 jobs to go.
  • Tidjane Thiam (Ex Credit Suisse CEO) is launching another ‘blank cheque trust me I know what I am doing’ fund trying to raise around US$250m.

And finally…

Mark and Becky are celebrating their 50th wedding anniversary.

Mark says to Becky, “Becky, I was wondering…have you ever cheated on me?”

Becky replies, “Oh Mark, why would you ask such a question now? You don’t want to ask that question…”

“Yes, Becky, I really want to know. Please…”

“Well, all right. Yes, three times…” she admitted. 

“Three? Well, when were they?” he asked.

“Well, Mark, remember when you were 35 years old and you really wanted to start your own business and no bank would give you a loan? Remember, then one day the bank president himself came over to the house and signed the loan papers, no questions asked?”

“Oh, Becky, you did that for me! I respect you even more than ever, to do such a thing for me. So, when was number two?” he asked.

“Well, Mark, remember when you had that last heart attack and you were needing that very tricky operation, and no surgeon would touch you? Then remember how Dr. DeBakey came all the way up here to do the surgery himself, and then you were in good shape again?” she said.

“I can’t believe it! Becky, you should do such a thing for me, to save my life. I couldn’t have a more wonderful wife. To do such a thing, you must really love me. I couldn’t be more moved. So, all right then, when was number three?” he asked, racking his brain.

“Well, Mark, remember a few years ago, when you really wanted to be president of the golf club and you were 17 votes short..?”

Clarence

XXXX