ASX 200 slid 57 points to 6760 (0.8%). Good rally into the close. Dow futures down 100 points. A floppy US market combined with some big names ex-dividends in BHP, CSL and RIO put the knife in today. Big miners fell, and fell some more after gains yesterday, BHP dropped 3.1%, RIO off 6.2% and FMG down 2.6%. Gold miners too slumped as bullion fell with NCM down 3.3% and NST off 3.4%. Energy stocks mixed ahead of the OPEC Plus meeting today with WPL down 0.5% and STO up 0.3%. Big Banks were the one saving grace with bond yields higher margins increase, the Basket roared to $165.92 with other financials trailing in their wake. MQG eased 0.9% with ASX off 2.0%. Healthcare was a trouble spot as CSL lost the dividend and again more to boot. The stock fell 4.2% with RHC down 3.5% and COH down 3.4%. Looks like bond yields taking their toll on these companies. Industrials slid with TCL off 2.1%, WES down 1.7% and WOW falling 2.6%. Tech stocks inevitably under pressure, APT tried hard to hold the line but succumbed in the end falling 2.0% and taking the All-Tech Index with it down 1.9%. In corporate news, OSH names new CFO. QBE up 2.8% on a new CEO appointment. MYR down 10.6% on its half-year results. No dividend. ARB up 3.0% on a UK acquisition. XRO lost 2.6% after announcing a large acquisition of Danish company Planday for cash and shares. On the economic front, the seasonally adjusted balance on goods and services surplus increased $3,009m to $10,142m in January vs estimates of a ~$6bn surplus. Retail sales in January rose 0.5% over the month missing estimates of a 0.6% lift. Follows a 4.1% fall in December. 10 -year yields rose again to 1.77%. In Asian markets, China falling hard ahead of five-year plans and 100- anniversary of CCP. CSI 300 down 2.7% and Japan down 2.7%

Today’s Highlights

  • ASX 200 down 57 to 6861. Great closing rally.
  • High 6809 Low 6709.
  • Big dividends weigh.
  • Big Bank Basket rockets to $165.92
  • All Tech Index down 1.9%
  • Dow Futures down 100 points.
  • Gold drifts to AUD$2202
  • 10-year yield pushing higher to 1.77%.
  • AUD slips to 77.84c
  • Bitcoin rises to US$49473.
  • In Asian markets, CSI 300 down 2.7% and Japan down 2.7%

STOCKS

  • ARB +3.0% Auto Styling acquisition.
  • RMC +4.02% shrugs off dividend.
  • QBE +2.80% new CEO cheers.
  • NIC -10.31% nickel price falls.
  • SM1 -9.75% guidance downgraded.
  • PDN -7.53% profit taking.
  • NXL -7.83% now below IPO price.
  • RIO -6.23% ex dividend and some.
  • PLL -12.26% profit taking.
  • MYR -10.61% results disappoint. Again.
  • RED +5.71% KOTH progress.
  • CWY +4.02% in talks for $2bn acquisition.
  • CWN+0.40% casino licence review put on hold.
  • KLL +5.00% Macquarie research and PT 40c.
  • DCC -unchanged- raises $8.8m.
  • NVX -9.43% SPP gets postponed.
  • ASX -2.04% February trading volumes down 13%.
  • Speculative stock of the day: Tasman Resources (TAS) +85.19% Twiggy backed Lake Torrens IOCG project drilling results and JORC statement. In trading halt now.
  • Biggest Winners: AVZ, STX, MNY, CPU, CWY, RMC and SWM.
  • Biggest Losers: PLL, NIC, SM1, NVX, BET, PLS and IGO.

TODAY

  • QBE Insurance Group (QBE) +2.80% Appoints Andrew Horton as CEO to replacing Interim CEO Richard Pryce, effective 1-September.
  • Link (LNK) -0.42% BGH Capital reported interested in Link’s PEXA stake. There are 6-10 potential buyers in the running for the stake. LNK also thought to be mulling an IPO for the business.
  • Macquarie Telecom Group (MAQ) -3.29% Signs $34m exclusive mobile services deal with Optus.
  • Legend Mining (LEG) -3.85% Receives $3.1m cash boost following option exercise. Legend Mining advises that 74.9m 4c 30-Mar-21 and 2m 7.2c 30-Sep-22 unlisted options have been exercised which has added $3.14m to the company’s cash at bank. As a result of this exercise of options, the Managing Director Mark Wilson has become a substantial shareholder and moved up to be Legend’s third largest shareholder. Also, the Chairman Michael Atkins and the General Manager Exploration Derek Waterfield have now become top 20 shareholders.
  • Xero (XRO) -2.61% Acquires Planday for total potential consideration of €183.5m.
  • Oil Search (OSH) -0.47% Appoints Peter Fredricson as CFO; effective 23-Mar.
  • Argosy Minerals (AGY) – commences works to increase JORC Indicated Mineral Resource estimate for Rincon Lithium Project.
  • Downer EDI (DOW) +0.78% Awarded $245m contract by ElectraNet to upgrade electricity network in South Australia.
  • Novonix (NVX) -9.43% To defer $15m share purchase plan until share price stabilises.
  • 4DMedical (4DX) -4.62% Completes institutional placement, raising $40m at 155c per share; $3m SPP to follow. Proceeds from the Placement will primarily fund, in conjunction with the $28.9m of MRFF funding, the development and commercialisation of the XVD Scanner. The company will also offer a Share Purchase Plan of up to $3m at 155c per share.
  • Myer Holdings (MYR) –10.61% First half profit $42.9m vs year-ago $39.6m. Revenue $1.40bn vs year-ago $1.61bn. EBIT $109.2m vs year-ago $106.2m. Dividend continues to be suspended.
  • ARB Corp. (ARB) +3.00% Acquires Auto Styling Truckman Group Limited which trades as Truckman for £21.9M ($39.3m) The Truckman business is based at its 4,860 m2 head office and central distribution hub in Birmingham in the United Kingdom. The purchase is being funded from existing cash resources and the business is expected to operate profitably from the commencement of ARB ownership, effective 2-Mar-21.
  • Ioneer (INR) – Launches $60m fully underwritten placement at 38c per share.
  • ResApp Health (RAP) -1.69% Advises that Medgate has commenced a three month pilot trial of ResAppDx.
  • Red 5 (RED) +5.71% Provides KOTH Gold Project update; restart of mining activities to proceed in 2022. The KOTH Mining Proposal has been approved by the Department of Mines, Industry Regulation and Safety and the company has approved Phase 2 of the EPC contract.
  • AJ Lucas Group (AJL) -7.50% Enters agreement with Third Energy to appraise a conventional gas prospect that spans both companies’ onshore licences in Yorkshire.
  • Healius (HLS) -0.75% Reports tax litigation case for FY2003-2007 is now closed; will reverse previously recognised amounts in FY21 financials. Tax litigation update: The High Court of Australia has refused the company’s application for special leave to appeal the Full Federal Court’s decision of 9-Oct-20. As the case related to Healius seeking a refund of tax already paid, the decision does not require Healius to remit any additional amounts to the ATO other than legal costs as assessed or agreed, which are immaterial.
  • Elders (ELD) -1.60% CFO Richard Davey intends to retire before June 30. The company will commence a search process for a new CFO
  • ASX (ASX) -2.04% February volatility: 0.8% vs year-ago 0.8%. Expected future volatility (as measured by the S&P/ASX 200 VIX) an average of 15.1 vs year-ago 14.9. Total capital raised $8.39bn vs year-ago $2.41bn. Average daily number of trades down 13% vs year ago. Average daily value $7.27bn vs year-ago $7.65bn.

ECONOMIC NEWS

  • The seasonally adjusted balance on goods and services surplus increased $3,009m to $10,142m in January vs estimates of a ~$6bn surplus.
  • Retail sales in January rose 0.5% over the month missing estimates of a 0.6% lift. Follows a 4.1% fall in December.

CV19 NEWS

  • Germany is laying out tentative plans to reopen the economy.
  • US vaccinations hit 2m a day.
  • Another record day of deaths in Brazil. 1910 now bringing the total to 259271.
  • Fake vaccines are turning up in South Africa.
  • Vaccine Tracker: 271m doses in 108 countries. 6.36m a day. US sees 80.5m people dosed.

BOND MARKETS

ASIAN NEWS

  • Chinese stocks under pressure as the CSI drops towards its lowest level this year. The trend continues to be away from high growth stocks which appear overvalued.
  • Hong Kong Sevens to resume this year.

US AND EUROPEAN HEADLINES

  • Expected violence again tonight on Capitol Hill as authorities are taking seriously threats of another attempt at taking control.
  • Las Vegas Sands is leaving Vegas in a US$6bn deal to sell out. Changing its name to Sands.
  • Monthly car payments heading higher but delinquencies still below average.
  • NY Governor apologies but isn’t going to resign.
  • German regulator files criminal complaint against Greensill Bank.
  • UK Chancellor delivers a Spend Now Tax later budget. The UK has now borrowed GBP350bn to stimulate its economy.
  • Jerome Powell speaks tonight.
  • OPEC Plus Zoom meeting tonight.

And finally…

While prosecuting a robbery case, I conducted an interview with the arresting officer. My first question was, “Did you see the defendant at the scene?”

“Yes, from a block away,” the officer answered.

“Was the area well lit?”

“No. It was pretty dark.”

“Then how could you identify the defendant?” I asked, concerned.

Looking at me as if I were nuts, he answered, “I’d recognize my cousin anywhere.

ATTORNEY: Doctor, how many of your autopsies have you performed on dead people?

WITNESS: All of them. The live ones put up too much of a fight.

ATTORNEY: What gear were you in at the moment of the impact?

WITNESS: Gucci sweats and Reeboks.

Clarence

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