The ASX 200 flat at 6715 on late sell down though defying US futures down 128 points despite Biden throwing another ‘kitchen sink’ at the US economy. Resource stocks in favour, BHP rose 1.6% and FMG up 1.7% on iron ore strength whilst banks mixed as CBA fell 1.1% and WBC up 1.5%. Healthcare feeling a little sick still with CSL slipping 1.4% and FPH off 2.2%. Industrials were mixed to flat although TLS rose 1.0% and in tech stocks APT hit all-time highs up 10.0% after broker upgrades and Affirm US IPO. WBT up 19.6% on another strong day and VUL returned from a halt and presented a positive PFS and the stock rose 29.1%.  The All -Tech Index rose 1.5% but its really just APT. TYR was hit with a short seller’s report as the outage continues to spotlight business risks and lack of a Plan B. The stock fell 11.8% before the halt. In corporate news, MHJ rose 7.3%, forecasts 30-40% first-half earnings growth. FMG up 1.7% despite its Iron Bridge project facing a cost blowout of up to US$650m. PDL down 3.0%, announced a 5.4% lift (+$5bn) in Funds Under Management (FUM) in Dec quarter to $97.4bn. RSG down 7.8% on its December quarter update. In economic news, Housing finance for November: Home loans value: +5.6% vs survey: +1.2%. Owner-occupier loan value: +5.5%; Investor loan value +6%. The 10-year yield slipped to 1.08%. In Asia, Japan down 0.4% and China off 1%.

Today’s Highlights

  • ASX 200 flat at 6715. Late slip.
  • High 6752 Low 6715. Narrow range.
  • Big Bank Basket slips modestly to $155.53.
  • All Tech romps 1.5% higher on APT. Now bigger than TLS.
  • Dow Futures down 128 as Biden outlines a US$1.9 trillion bazooka.
  • Gold rises to AUD$2386.
  • 10-year yield slips to 1.08%
  • AUD steady at 77.61c
  • Bitcoin rallies back to US$38,634
  • In Asia, Japan down 0.4% and China off 1%.

STOCKS

  • VUL +29.06% pre-feasibility study cheers.
  • PLL +20.00% lithium back.
  • SCG +5.04% on no new CV19 cases.
  • WBT +19.59% keeps on going higher.
  • PEN +11.11% US market access.
  • BYE +8.57% gas prices rising.
  • SOR +10.53% volatility continues.
  • APT +10.04% Affirmative valuations help.
  • SZL +10.59% US focus BNPL.
  • NST -0.93% SAR -0.21% shareholders back merger.
  • AEF +6.79% warm glow of FUM.
  • PME +4.54% broker upgrades.
  • TYR -11.79% trading halt short seller’s picnic on outages.
  • PNV -8.30% brokers cooling on recent results.
  • TEK -6.33% NTA hit by MSB fall.
  • AVA -6.20% profit taking.
  • POS -5.06% profit taking despite nickel back.
  • Speculative Stock of the Day: Nothing on volume. VUL the best.
  • Biggest Winners: PLL, PDN, SZL, APT, ERA, ABR, AEF and SYR.
  • Biggest Losers: TYR, PNV, RSG, AVZ,BCK, RED and RMD.

TODAY

  • Michael Hill International (MHJ) +7.35% Expects half-year group EBIT of $56-60m with comparable EBIT for the half of $41m-$45m, representing 30%-40% growth. Total sales $317.5m vs year-ago $326.5m. Same-store sales +6.3% vs year ago. Saw margin growth in all markets and channels of 150 to 250 bps for the half against prior year. Payment of the FY20 interim dividend originally payable in March 2020 was deferred to preserve cash as the global pandemic took hold. The board has resolved to pay this outstanding debt on 29 January 2021.
  • Fortescue Metals Group (FMG) +1.70% Iron Bridge project facing cost blowout of up to US$650m. Budget review comes on the back of wage pressure and worse access to skilled labour in WA.
  • Integrated Research (IRI) +0.81% Expects H1 revenue and profit to be at the lower end of its guidance range. Profit guidance: breakeven to $2m, revenue $34-37m.
  • Resolute Mining (RSG) -7.84% December quarter gold poured 89,888oz.Total CY20 gold poured of 395,136oz with total gold recovered of 400,713oz. AISC of US$1,074/oz. Cash and bullion at the end of December of US$106m. In the 12-months to December 31, 2021, sees gold production in the range of 350-375Koz at a forecast AISC between US$1,200/oz and US$1,275/oz. Capital expenditure (non-sustaining) for operating assets forecast to be US$29m. Investment in exploration and other development capital expenditure forecast to be US$6m. Proceeds from the sale of Bibiani to be used to reduce debt.
  • Pengana Capital Group (PCG) – Funds under management at the end of December of $3.59bn vs quarter ago $3.52bn.
  • Objective Corp. (OCL) +4.31% Unaudited first-half profit of $7.2m vs year-ago $4.3m. Expected headline H1 results: Revenue $46.5m vs year-ago $33.3m. EBITDA m$11.8M vs year-ago $6.8m. Annual Recurring Revenue (ARR) $70.1m vs year-ago $54.1m. R&D Investment (100% expensed) $11.1m vs year-ago $7.7m. Cash balance $27.7m at the end of December. CEO comments: Engaging on some new customer opportunities proved more difficult than usual in 1HY2021 but we expect the strong momentum demonstrated in H1 to continue for the full financial year.
  • Pendal Group (PDL) –2.99% Funds under management $97.4bn at the end of December vs $92.4bn a quarter ago.
  • Tyro Payments (TYR) -11.79% In a trading halt, pending a response to Viceroy Research’s short report. The company also intends to provide the market with updates on progress against its disclosed recovery plan and current transaction values.

ECONOMIC NEWS

  • Housing finance for November: Home loans value: +5.6% vs survey: +1.2%. Owner-occupier loan value: +5.5%; Investor loan value +6%.

Overseas Arrivals and Departures

BONDS

COVID – 19 NEWS

  • China reports 135 new CV19 cases. South Korea reports 513 new cases.
  • WHO arrives in Wuhan one year after first appearance.
  • The U.K. aims to have all people over 50m vaccinated by the end of March. 3m so far.
  • California’s intensive-care unit bed capacity dropped by 89 to 1,094.
  • France will extend tighter curfew measures across the country. The 6 p.m. curfew already in place across much of eastern France will become nationwide from Saturday.
  • New York state reported more than 200 daily Covid-19 deaths for the first time since May.
  • Germany looks to tighter lockdowns.

ASIAN NEWS

  • North Korea held its second major military parade in three months to mark a rare party meeting. The parade unveiled a new version of a submarine launched ballistic missile with a 2000km range. Could target Japan.
  • Bird flu hits India.
  • Who needs Betcoin or APT when you can trade Japanese power futures! Up 13 times since the beginning of December.

EUROPEAN AND US HEADLINES

  • Chatter on social media sites increasing for risks to politicians and government as Inauguration approaches. One Senator is buying body armour as panic buttons alleged to have been disconnected before the march on the Capitol. Far right is now using encrypted platforms to avoid FBI.
  • Biden outlines pilot for new season of ‘The President’. No way as exciting as the last season with its cliffhanger climax and ‘iconic’ leading man. New season has a new show runner and looks dull in comparison. Dull may be good.
  • Trump intends living at Mar-a-Lago after leaving office. Biden calls vaccination plan a ‘dismal failure’.
  • US has now blacklisted Xianomi and Cnooc.
  • BlackRock assets surge to US$8.68 trillion.
  • Martin Luther King Day Monday

And finally….

Ordering a Pizza in 2022

CALLER:Is this Pizza Hut?

GOOGLE: No sir, it’s Google Pizza.

CALLER: I must have dialed a wrong number, sorry.

GOOGLE: No sir, Google bought Pizza Hut last month.

CALLER: OK. I would like to order a pizza.

GOOGLE: Do you want your usual, sir?

CALLER:My usual? You know me?

GOOGLE:According to our caller ID data sheet, the last 12 times you called you ordered an extra-large pizza with three cheeses, sausage, pepperoni, mushrooms and meatballs on a thick crust.

CALLER: Super! That’s what I’ll have.

GOOGLE:May I suggest that this time you order a pizza with ricotta, arugula, sun-dried tomatoes and olives on a whole wheat gluten-free thin crust?

CALLER: What? I don’t want a vegetarian pizza!GOOGLE: Your cholesterol is not good, sir.

CALLER: How the hell do you know that?

GOOGLE:Well, we cross-referenced your home phone number with your medical records. We have the result of your blood tests for the last 7 years.

CALLER:Okay, but I do not want your rotten vegetarian pizza! I already take medication for my cholesterol

.GOOGLE:Excuse me sir, but you have not taken your medication regularly. According to our database, you purchased only a box of 30 cholesterol tablets once at Lloyds Pharmacy, 4 months ago.

CALLER: I bought more from another Pharmacy.

GOOGLE: That doesn’t show on your credit card statement.

CALLER: I paid in cash.GOOGLE: But you did not withdraw enough cash according to your bank statement.

CALLER: I have other sources of cash.

GOOGLE:That doesn’t show on your latest tax returns, unless you bought them using an undeclared income source, which is against the law!

CALLER: WHAT THE HELL!

GOOGLE: I’m sorry sir, we use such information only with the sole intention of helping you.

CALLER: Enough already! I’m sick to death of Google, Facebook, Twitter, WhatsApp and all the others. I’m going to an island without the internet, TV, where there is no phone service and no one to watch me or spy on me.

GOOGLE: I understand sir, but you need to renew your passport first. It expired 6 weeks ago…Welcome to the future

Clarence

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