ASX 200 falls 22 points to 7270 (0.3%) after strong opening on sparse volume. Chinese PPI and 10-year bond falls hurting sentiment short term. Dow futures down points. An impressive start was ambushed by Chinese PPI data although volumes were skimpy. Banks faded after a strong start with 10-year yields slipping to 1.57%. The Big Bank Basket slipped to $182.92. Other financials mixed, MQG still suffering from NXL issues down 1.3%. Insurers flat. Industrials mixed CSL fell 0.4% after recent strong gains, WOW and WES fell 1.9% and 0.7% respectively and tech stocks on the nose except APT which is trying hard to hit $100, closing up 1.7%. The All–Tech Index closed down 0.6%. ALU slipped 7.5% as doubts on the US bid continue and APX and WTC joined in the sell off. Miners better with BHP up 0.6%, RIO up 0.5% and FMG up 1.0%. Gold miners slipped with NCM off 0.7% and NST down 1.4%. In corporate news, BKW had a good day on an investor update rising 11.3% on encouraging US signs. UBS was on the front page of the AFR talking APT down to no effect, and consumer sentiment unsurprisingly fell on the Melbourne lock down. Asian markets fell with Japan down 0.3% and China down 0.1%.

Today’s Highlights

• ASX 200 falls 22 points to 7270 in soggy trade.
• High 7335 Low 7270. Closes on lows on PPI and consumer sentiment.
• Dow futures down 30.
• Big Bank Basket slides to $182.92
• All Tech Index down 0.6%
• Australian Gold rallies to $2445.
• 10-year yield falls to 1.57%
• AUD steady at 77.39c.
• Bitcoin falls to US$33354
• Asian markets fell with Japan down 0.3% and China down 0.1%.

STOCKS

• VUL +6.27% rally is back on.
• WHC +5.18% coal prices feeding bulls.
• BKW +11.32% US firing.
• MMM +8.98% no reason really.
• URW +7.77% Europe opening.
• ALU -7.50% bid scepticism.
• AEF -3.20% sell off continues.
• APX -3.90% sellers back in charge as ALU wilts.
• POS -9.52% drill results.
• SWP -2.97% profit taking.
• PNR -6.38% amended assay table.
• PBP +11.79% board renewal.
• SVM +13.24% Kasiya deposit confirmed.
• NAB -0.78% hires former AUSTRAC CEO. Smart.
• CDD +26.21% strategic review
• PNR -6.38% amended assay tables.
• PRN -2.21% enthusiasm for SFR deal wanes quickly.
• Speculative Stock of the Day: Coda Minerals +235.21% Again. Thick zone of IOCG mineralisation intersected at Emmie Bluff. Nearology looks the go.
• Biggest Winners: BKW, MMM, URW, VUL, PPK, WHC, ABR and NAN.
• Biggest Losers: PYC, ALU, ERA, SWM, OCL, WTC and APX.

TODAY

• AMP (AMP) -0.85% Understood to be considering the sale of its NZ Wealth Management Business and IPAC Securities Business. There are estimates theNew Zealand division could sell for $500m. AMP’s IPAC securities business is already up for sale, with price expectations around $200m.
• BHP Group (BHP) +0.60% Elliott Management named as one of the short-listed parties in the running for BHP’s portfolio of coal assets. Final bids are understood to be due at the end of July for the ~$2bn portfolio, there is speculation that Golden Energy and Adaro Energy may also be involved. New Hope and Whitehaven Coal reportedly put in offers in the first round of the competition, but for only part of the business.
• Brickworks (BWK) +11.32% Building products EBIT expected to be higher in both Australia and North America in FY21. The company has revalued profit within its Joint Venture Industrial Property Trust, with Brickworks’ share expected to be around $100m. This is expected to contribute to record Property underlying EBIT of $240-260m for FY21, up from $129m in the prior year.
• Perenti Global (PRN) -2.21% Awarded seven-year $648m contract for open pit mining services at Sandfire Resources Motheo copper project.

ECONOMIC NEWS

• NAB and WBC have upgraded their forecasts for the Australian economy on Wednesday. NAB expects year-average GDP growth of 5.1% in 2021, 2.6% in 2022, and 2.2% in 2023. WBC lifted its GDP forecasts to 4.8% from 4.5% in 2021 and to 3.2% from 3.0% in 2022.
• RBA’s Christopher Kent speaking at The KangaNews Debt Capital Markets Summit, “there are good prospects for growth and an eventual increase in wages and inflation. We anticipate that will be a gradual process, with inflation unlikely to be sustainably within the target range of 2−3% until 2024 at the earliest.”
• The Westpac-Melbourne Institute Index of Consumer Sentiment fell 5.2% to 107.2 in June from 113.1 in May. The Index has now fallen by 9.7% over the last two months. WBC believes the initial 4.8% fall in May can be mainly attributed to a combination of a statistical correction following a very strong surge in April to an eleven-year high, and some disappointment around the Budget given high expectations leading into the announcement. The latest fall in June is almost certainly due to concerns around the two-week lockdown in Melbourne.

• The seasonally adjusted estimate for total dwellings approved fell 8.6% in April, in line with estimates, follows a 19% lift in the previous reading.

• Payroll jobs rose by 0.3% in the fortnight to 22 May 2021, following a 0.1% fall in the previous fortnight, according to the ABS.
• China’s production prices climb at the fastest pace since 2008, up 9% in May from a year earlier, fuelling worries about global inflation.

BOND MARKETS

CV19 NEWS

• Vaccine Tracker: 2.19bn doses in 178 countries (2 new ones). 35.4m a day. In US, 304m doses with 1.07m a day (slightly higher).
• The delta variant of coronavirus that first arose in India appears markedly easier to transmit and more virulent than previous mutations.

ASIAN NEWS

• China’s factory-gate inflation rose to its highest level since 2008 in May with PPI up to 9% following a 6.8% gain in April. Consumer prices increased 1.3% from a year ago, missing an estimate of 1.6%. Pork prices falling 24% undercut stronger food prices elsewhere. Rates expected to remain unchanged on this data though.

US AND EUROPEAN HEADLINES

• Bitcoin heading for a ‘Death Cross’. Technical experts eyeing US$20,000 as possible.

• French President slapped in the face during a walkabout. He won’t be doing that again. Merde.
• US financial regulator at the SEC says it should gamify its communication with investors.
• Experts warn that the closure of Shenzen’s container terminal due to CV19, will have inflationary effects as slowdown in trade will bite.
• US passes landmark Anti-China bill. Let the fun begin. The bill allocates $US50bn over five years to spur the domestic manufacturing of semiconductors in the US. Another $US80bn will be spent on research into artificial intelligence, robotics and biotechnology as well as $US1.5bn to boost innovation in advanced wireless technologies such as 5G and 6G.
• White House investigates leaks that say that billionaires pay little tax.
• European markets set for a firmer opening. But only just.

And finally….

The power of proof reading…

Did I read that sign right?    
TOILET OUT OF ORDER. PLEASE USE FLOOR BELOW. 
—————————— —————————— —————————— – 
In a Laundromat: 
AUTOMATIC WASHING MACHINES: PLEASE REMOVE ALL YOUR CLOTHES WHEN THE LIGHT GOES OUT. 
—————————— —————————— —————————– 
In a London department store: 
BARGAIN BASEMENT UPSTAIRS… 
—————————— —————————— ————————- 
In an office: 
WOULD THE PERSON WHO TOOK THE STEP LADDER YESTERDAY PLEASE BRING IT BACK OR FURTHER STEPS WILL BE TAKEN. 
—————————— —————————— —————————— —————————— ————— 
In an office: 
AFTER TEA BREAK, STAFF SHOULD EMPTY THE TEAPOT AND STAND UPSIDE DOWN ON THE DRAINING BOARD. 
—————————— —————————— —————————— — 
Outside a second-hand shop: 
WE EXCHANGE ANYTHING – BICYCLES, WASHING MACHINES, ETC. WHY NOT BRING YOUR WIFE ALONG AND GET A WONDERFUL BARGAIN? 
—————————— —————————— —————————— —————————— — 
Notice in health food shop window: 
CLOSED DUE TO ILLNESS… 
—————————— —————————— —————————— ———— 

Clarence

XXXX