The ASX 200 took a tumble today as the bond market crumbled after the RBA went missing again and let rates soar. The ASX 200 fell 119 points to 7311(1.6%) finishing the week down 2.1%%. Short-dated yields hit 0.68% and 10-year yields went through 2% closing at 2.04%. Big moves and potential a big change. Tuesday will be interesting around the RBA board room table before the Bet with Mates session begins. The banks got whacked, MQG raising $1.5bn too not helping, the Big Bank Basket fell to $187.20 (2.1%) and the insurers dropped too led by QBE down 2.2% and IAG off 2.8%. REITS hit hard too, GMG off 2.0%, SCG down 3.2% and MGR down 3.8%. Industrials also under pressure with WOW down 1.8%, TCL off 1.8% and WES down 2.2%. Tech stocks falling too, APT down 0.4% dragging the All–Tech Index down 1.3%. Miners were surprisingly only modestly lower, BHP dropped 1.2% and FMG only 0.6% off. Gold miners eased back and energy stocks lower but lithium and battery tech still in demand ahead of COP26 and Biden’s environmental plans. In corporate news, MQG in a trading halt pending a $1.5bn capital raise to accompany strong results, too many opportunities it seems to pass up. HT1 rose 31.3% on ATO settlement, VUL returned after attack and dropped heavily by 16.5% and PBH continued to track lower by 4.4%. RMD produced some good results and innovative ways to beat supply chains issues and rose 4.2%. On the economic front, it was all about the RBA and the bond yields, retail sales came in better than expected but no one was watching. Asian markets mixed again.

MAJOR MOVERS:

  • Winners: BOE, SWM, SYR, PSI, NVX, FDV, GUD, NMT
  • Losers: VUL, URW, CVN, CTT, EOS, TMC, PBH, NHC.
  • Positive sectors: Healthcare (just) Lithium and battery tech.
  • Negative sectors: Banks. REITs.Tech. Miners. Energy. Insurers.
  • Hi 7447 Lo 7319 ASX 200 down 1.4% for the week.
  • Big Bank Basket: Hit hard down to $187.20(2.1%)
  • All-Tech index: Down 1.3% APT down 0.4%
  • Gold: Slips to AUD2377
  • Bitcoin: Rallies to US$61527
  • Aussie Dollar:  Rallies hard at 75.51c 10-YEAR YIELD: Soars to 2.04%
  • Asian Markets: Japan up 0.4% Hong Kong down 0.5% and China up 0.3 %
  • US Futures: Dow futures down 24 NASDAQ futures down 98.

STOCKS ON THE MOVE

  • NVX +8.50% battery stocks charging ahead as COP26 beckons.
  • FDV +8.43% broker upgrades.
  • LKE +5.62% end of week bounce.
  • BET +5.63% bookie bounce.
  • SWM +9.64% debt refinancing.
  • PLS +3.77% lithium no longer depressed.
  • KAR +4.60% oil price helps.
  • HT1 +31.29% settles tax case.
  • AGY +9.43% lithium stocks doing well.
  • MNS +9.64% pushing back up.
  • PH2 +12.12% Sept quarterly report.
  • HUO +0.26% Twiggy turns turtle and backs bid. Money talks.
  • URW -6.23% heading down again.
  • EOS -4.49% in seller’s sights.
  • VUL -16.54% no Klingon for the buyers.
  • PBH -4.40% spill over from downgrade.
  • MMM -32.12% fails to deliver, downgrades.
  • IVX -16.13% profit taking after big day yesterday.
  • GCY -9.57% rejects WGX offer.
  • BYE -9.68% quarterly report.
  • DTC -9.68% negative sentiment continues.
  • Speculative stock of the Day: S2 Resources (S2R) +102.38% awarded block 4 in North Central Victorian gold fields ground release tender. The acreage surrounds the world class Fosterville Mine.

IN THE NEWS

  • Macquarie Group (MQG) – record half-year report of $2.04bn up 107%. It will also raise $1.5bn from insto investors at $190. It cut its dividend payout ratio to 50% for an interim dividend of 272c per share, which is more than double the 135c per share in the prior corresponding period. It also plans to integrate its Green Investment Group into Macquarie Asset Management. Reasons for the capital raise suggest there are just a plethora of opportunities.
  • ResMed (RMD) – Better-than-expected results overnight. Revenue up 20% which was 5% better-than-expected with earnings 9% better-than-expected. A new product launch into the US market and a recall on a competitor’s product helped the result.
  • Marley Spoon (MMM) – downgrade last night aftermarket. Full-year revenue growth expected to be between 26-28% down from 30-35%.
  • Mesoblast (MSB) says it’s in negotiations to refinance its debt before the end of the year. Quarterly report today showed in the September quarter it posted an operating cash loss of $US19.6m on revenue of $US2m.
  • Qube Logistics (QUB) – repaid all its Jobkeeper subsidies amounting at around $16.9m.
  • Carsales (CAR) – AGM update is positive as the digital marketplace tips more growth in FY 2022.
  • Pointerra (3DP) –has grown annualised contract value $1.9m, or 19%, to $11. 9m over the September quarter.
  • NAB – James Spenceley withdraws nomination.
  • Crown Resorts (CWN) – Settles class action for $125m

ECONOMIC NEWS/ BOND MARKETS

  • ASIC today released its response to industry consultation on the use of “crypto assets as underlying assets for exchange traded products” (ETPs). It looks like it has put the onus on the ASX and Chi-X to approve products that meet their criteria. VanEck, BetaShares and CosmosAsset Managers may have products waiting to go.
  • Retail sales came in hotter than expected, up 1.3% in September vs estimates of 0.4%. The move marked the first monthly improvement since May.
  • Producer prices or business inflation rose 1.1% in the September quarter vs prior 0.7% in the previous quarter. The main contributing factors were heavy and civil engineering construction, due to rises in wages and materials supported by increased public sector investment stimulus. Petroleum refining and petroleum fuel manufacturing, due to rising global crude oil demand and delays in OPEC+ oil agreement to raise production.

CV19 NEWS

  • Singapore mystery CV19 cases falling back to below 4000.

ASIAN MARKETS

  • ‘Just in Time’ interest payments save Evergrande yet again. Certain holders of 9.5% bond due 2024 were paid Thursday.
  • Coal in China in freefall but should it bother Australian coal companies. We are not allowed to sell our coal to them anyway. So what do we care what they are paying their coal miners? Shouldn’t we be looking at coal prices in the markets we are selling into?
  • Chinese government says that as production costs are lower so should prices be lower. You have to love communism.

US AND EUROPEAN NEWS

  • European markets all opening around 0.3% lower.
  • Focus on tech result reactions after Apple and Amazon. Meta must be the strangest rebranding since Z1P changed from Quadpay.
  • US GDP growth stumbles to 2% in September quarter.
  • Focus on Biden and his stimulus plan.
  • Regulators are now worried that new trading apps have too many emojis and confetti which encourages dangerous trading activity. Bit late now.
  • T Rowe Price to buy Oak Hill in US$4.2bn cash and share deal.
  • UK and French back at war over fish.
  • UN Climate Change Conference COP(out)26 begins Sunday. Trick or treat?