ASX 200 crashed 134 points to 7235 (1.8%) onsolid volume as US rate uncertainty came to town. Banks and other financials were especially hard hit as bond yields fell (?). The Big Bank Basket cratered to $178.71 with CBA a big loser down 5.4% on news of a sale of its general insurance business. Insurers suffered with QBE down 5.3% and IAG down 3.2%. MQG dropped 2.2% as risks build. Industrials were flat across the board. SYD down 2.8%, TCL off 1.5% and ALL down 1.7%. Some strength in consumer stocks in COL up 0.7% and WOW up 0.8%. Healthcare in triage, CSL down 0.2% and RMD down 1.2% on profit-taking. Tech stocks were mixed, WTC down 0.7%, XRO down 0.9% and REA off 3.3% but BNPL stocks better ahead of Amazon Prime day. Z1P up 0.9% and APT up 2.5%. The All-Tech Index down 0.5%. Miners flopped, BHP down 2.0% and energy stocks eased led by STO off 1.2% with WPL down 1.8%. Gold miners weaker in second liners, DEG down 5.3% and CHN off 7.8%. In corporate news, ILU is off 2.1% on reports it is looking to sell its Sierra Leone operations. There is also speculation it may be able to increase zircon pricing by ~$125/tonne. BLD 1.3% higher to sell its North American Building Products business to Westlake Chemical subsidiary for $2.9bn. Continues to review options for its North American Fly Ash business. VCX down 1.2% after reporting a 1.2% fall in property valuations since December. Proposes interim dividend of 6.6cps. AST down 2.2% as its reviews staff underpayments. On the economic front, preliminary retail turnover rose 0.1% in May, the Victorian lockdown weighing on the result. 10-year yields back to 1.49%. Asian markets smashed with Japan down 2.42%, HK down 1.45% and China off 0.09%. Dow futures down 74 points.
- ASX 200 down 134 to 7235 (1.8%). Solid volume for a Monday
- High 7347 Low 7217
- Dow futures down 74
- Big Bank Basket crashes to $178.71
- All Tech Index falls to 0.5%
- Australian Gold slips to $2360
- 10-year yield falls to 1.49%
- AUD drops 75.02c.
- Bitcoin slips to US$33969
- Asian markets smashed with Japan down 2.42%, HK down 1.45% and China off 0.09%
END OF DAY PODCAST – ASX 200 falls 134 points to 7235 (1.8%). Banks bashed badly with Big Bank Basket falling to $178.71. CBA falls 5.5% on the sale of general insurance business. BLD rises 1.3% after the sale of US business. All Tech Index outperforms down only 0.5% as BNPL stocks rally. Miners under pressure with financial hard hit as bond yields fall. 10-year at 1.49% Tokyo down 3.3% European markets expected to open around 1% lower.
- ACW +19.23% clinical trial progress.
- MP1 +2.27% board update.
- BLD +1.33% block trades galore.
- JIN +2.89% crunch week for TAH?
- APT +2.46% Z1P +0.86% BNPL resurgence.
- CDA -11.80% sell off continues.
- TLX -9.98% trial update.
- SPL -9.41% UK Update. Regulator pauses spray.
- LTR -7.41% commodity sell-off.
- VUL -8.01% sliding back further.
- LCK -12.82% broker research.
- VML -8.33% commodity sell-off.
- 8VI +10.71% Annual report.
- IRI +8.42% market update.
- REA -3.29% house price constraints perhaps?
- ALL -1.70% profit-taking.
- QBE -5.30% trounced.
- MIN -5.45% iron ore and lithium weakness.
- WTC -0.68%% Canada’s Descrates results set scene for WTC.
- CBA -5.43% capital return gets closer.
- Speculative Stock of the Day: Patrys Limited (PAB) +12.24% last weeks momentum continuing on news of potential for brain cancer treatment.
- Biggest Winners: JIN, HMC, LFG, APT, MP1, ALU and FLN.
- Biggest Losers: CDA, TLX, SPL, VUL, CHN, ALK, LTR.
- Silver Lake Resources (SLR) –0.91% To resume full operations at its Daisy Complex.
- Iluka Resources (ILU) –2.14% Understood to be looking at selling its Rutile operations in Sierra Leone. Trade press reports point to a tightening in mineral sands markets and that Iluka may be able to increase zircon pricing by ~$125/tonne in its next round.
- Bank of Queensland (BOQ) -4.98% Obtains approval from the treasurer for the previously announced acquisition of ME Bank.
- CBA (CBA) -5.46% To sell its general insurance business to Hollard Group for $625m.The transaction will also include earn-out payments, payable upon achieving certain milestones. The transaction is expected to deliver $400m of CET1 capital resulting in a proforma uplift of 9bps, the transaction will also result in a post-tax gain on sale of ~$90m.
- Mayne Pharma (MYX) -4.29% Licenses Australian rights to SOLARAZE gel and ACTIKERALL from Almirall.
- Boral (BLD) +1.33% To sell its North American Building Products business to Westlake Chemical subsidiary for $2.9bn. The board will assess options to distribute surplus capital. As part of the review of Boral’s North American Fly Ash business Boral is continuing to explore value creation opportunities through a potential joint venture, strategic alliance, divestment to a third party or continued ownership of the Fly Ash business.
- Sezzle (SZL) -1.82% A Twitter livestream that outlined a case to short Sezzle highlighted “co-marketing expenses” that could require the company to make extra payments if it fails to reach certain milestones.
- Vicinity Centres (VCX) –1.21% Reports a preliminary net valuation decline of 1.2% for the six months ending June 30, for its 60 directly-owned retail properties. Proposes interim dividend of 6.6cps. The full-year distribution of 10c is expected to be towards the lower end of its policy range of 95% to 100% of Adjusted Funds From Operations.
- AusNet Services (AST) -2.19% A review is being progressed as a priority to determine, among other things, the extent of employee (both current and former) underpayments. That said, remediation costs are not anticipated to have a material impact on FY22 financial performance.
- Back to the Future: Barnaby Joyce back as leader of the Nationals.
- Retail turnover rose 0.1% in May 2021, seasonally adjusted, according to preliminary retail trade figures released today by the ABS. Ben James, Director of Quarterly Economy Wide Surveys, said: “There were mixed results across the industries and states and territories, with COVID-19 restrictions in Victoria impacting the May result. Victoria fell 1.5% as the state entered its fourth lockdown on May 28 with trade restricted for physical stores.”
- Vaccine Tracker: 2.62bn doses in 180 countries. 39.7m doses a day. In the US, 318m doses at 1.24m a day. In Australia, 103,040 doses a day. 10 months to get to 75% of the population.
- Shenzhen is tightening restrictions on public transit and at the airport, as nearly 40 inbound passengers tested positive for Covid.
- Russia, Germany and Portugal reported a rise in numbers in the highly transmissible delta variant that first appeared in India.
- Canada’s border chief says US – Canada border unlikely to be opened until 75% of Canadians become interesting.
- Some of Japan’s biggest private employers will offer in house vaccinations starting Monday.
- Qatar will require full vaccination for fans at the 2022 World Cup.
- HSBC sells French business for EUR1. Takes a US$2.3bn hit.
US AND EUROPEAN HEADLINES
- European markets expected to open around 1% lower on US leads.
- Bidding war looms for UK supermarket group Morrisons.
- CAPE Valuations in US are at 36.4 times. Twice the long-term average over last 40 years. Highest since 1881.
- Worse drought in a century hits Brazil.
- Record low turn out in French local elections.
- 41,000 people have signed a petition to refuse Jeff Bezos a return to Earth.