The ASX 200 tried to rally off lows following RBA abandoning yield curve controls, but failed with the ASX 200 down 47 points to 7324 (0.6%). Iron ore futures in China falling hard again. Banks were the soft point today after the very disappointing WBC results yesterday and broker downgrades. The stock fell another 2.7% bringing the two-day loss to 10%. The Big Bank Basket dropped to $184.93 down 1%. Other financials also under pressure as volatility continued in the bond market. IAG updated the market on perils on the sea and fell 7.0%. MQG down 1.5% and new kid on the block (NKOTB) GQG capped off a disappointing debut falling another 4.4%. Miners were the other weak points, coal stocks in a hole, WHC down 9.5% and CRN off 4.8%, iron ore miners also falling BHP down 2.3% and FMG down 2.6% after announcing plans to embrace a large hydrogen investment in South America. Energy stocks and gold miners drifted lower too. Industrials were relatively firm, GMG shooting the lights out with an upgrade rising 5.6%. ALL rose 1.6% after rights are no longer traded, IEL rose 3.0% as NSW hastened its reopening. In corporate news, NWL bid for PPS up 14.5%, TLX gained 8.1% on TGA approvals. In economic news, the RBA abandoned its yield curve controls as the financial equivalent of the Maginot Line. But stopped short of pulling the rug on stimulus. Fill speed ahead and damn the torpedoes.

MAJOR MOVERS:

  • Winners: Verry Elleegant. PPS, JDO, TLX, ASM, GMG, OCL, AVZ, NVX.
  • Losers: VUL, WHC, YAL, IGO, CIA, IAG, RBL, MCR.
  • Positive sectors: Gaming. Healthcare.
  • Negative sectors: Banks. Miners.
  • Hi 7396 Lo 7312. Iron ore futures limit down.
  • Big Bank Basket: Down to $184.93 (1.0%).
  • All-Tech index: Unchanged.  APT down 1.3%.
  • Gold: Higher at AUD2392
  • Bitcoin: Drifts down to US$61396
  • Aussie Dollar:  Falls to 74.95c on RBA decision. 10-YEAR YIELD: Flops back to 1.89%
  • Asian Markets: Japan down 0.4%. Hong Kong up 0.7% and China down 0.6%
  • US Futures: Dow futures down 87 NASDAQ futures down 90.

STOCKS ON THE MOVE

  • PPS +14.46% NWL bid.
  • TLX +8.13% TGA approvals.
  • GMG +5.57% earnings upgrade.
  • JDO +9.73% builds on debut.
  • COL -0.12% Macquarie prefers to WOW.
  • NVX +4.30% continuing higher. Glasglow.
  • STP +3.64% no chaffing here.
  • MNS +18.48% battery tech.
  • CAE +18.52% placement to existing shareholders.
  • CHL +11.28% #vanlife rules.
  • BUB +7.41% few buyers, no kidding.
  • NTD +6.55% acquisition of Black Rubber.
  • GQG -4.36% sliding lower.
  • RBL -6.30% shorts on top.
  • VUL -9.99% Spocked lower.
  • BPT -3.93% MD resigns.
  • WHC -9.54% old king coal not such a merry old soul.
  • IGO -8.42% AZY corporate presentation.
  • IAG -7.02% Perils update.
  • FMG -2.65% heading to South America and big hydrogen investment.
  • SDV -9.03% $20m capital raising.
  • JMS -8.7% board changes and broker commentary.
  • MMM -11.90% continual pressure on margins
  • IPO of the Day: Remsense (REM) +165.00% raised $5m at 20c and is involved in engineering and technology solutions for the mining industry.
  • Speculative stock of the Day: Arizona Lithium (AZL) +27.78% Good moves in lithium space. Strong volume in this one but placement at 7.5c seems to be the catalyst.

IN THE NEWS

  • Squid Game, or SQUID, was the latest memecoin sensation, inspired by the Netflix hit. It surged more than 230,000% in the past week to US$2,861.80, according to CoinMarketCap pricing — only to plunge 100% to less than half a cent as of Monday.
  • Fortescue Metals (FMG) planning a possible US$8.4bn green hydrogen investment in Argentina. Reuters said a US$1.2bn pilot stage aiming to produce 35,000 tons of green hydrogen is planned for 2022-2024, followed by a US$7.2bn first productive stage aiming for an output of roughly 215,000 tons of green hydrogen.
  • BHP Group’s (BHP) plan to exit thermal coal looking uncertain – Bloomberg. Record prices and changing investor attitudes are putting the planned retreat on hold.
  • Insurance Australia Group (IAG) increases expectation for FY22 net natural perils claim coststo $1,045m vs prior $765m. Lowers FY22 reported insurance margin guidance from 13.5 – 15.5% to 10 -12.0%
  • Netwealth (NWL) – Proposes $785m Praemium (PPS) merger.
  • Goodman Group (GMG) FY22 earnings guidance increased with operating EPS growth expected to be in excess of 15% vs prior 10%. Cites strength in development projects, leasing success and stronger than expected performance of its partnerships.
  • Adore Beauty (ABY) chair Justin Ryan to retire.

ECONOMIC NEWS/ BOND MARKETS

RBA Meeting:

The Board decided to:

  • maintain the cash rate target at 10 basis points and the interest rate on Exchange Settlement balances at zero per cent
  • continue to purchase government securities at the rate of $4 billion a week until at least mid- February 2022
  • discontinue the target of 10 basis points for the April 2024 Australian Government bond.
  • The central forecast is for GDP growth of 3% over 2021 and 5.5% and 2.5% over the following two years.
  • Inflation has picked up, but in underlying terms is still low, at 2.1 per cent. The headline CPI inflation rate is 3%.
  • The Board will not increase the cash rate until actual inflation is sustainably within the 2 to 3% target range

The RBNZ has said it had no control over house prices. Well, a tiny part to play, maybe.

CV19 NEWS

ASIAN MARKETS

  • South Korea’s inflation breached 3% for the first time in almost a decade. Headline inflation in October was driven by a 10.4% jump in transportation costs, affected by energy prices, which added 1.11% to the overall reading. Communication fees also rose 13.1% from last year’s weak reading.

US AND EUROPEAN NEWS

  • Aramco hit a record high as earnings have doubled in the last year.
  • Cop(out)26 continues in Glasglow. Leaders pledge to halt deforestation.
  • EV car maker Rivian targets a valuation of around US$53bn. No real revenue as yet and bigger than Nissan or Kia.
  • Nubank is looking at a US$50bn valuation. Nubank is a Braxilian fintech.
  • US regulators urge need for legislation of stablecoins.

And finally….

A woman and her ten-year-old son were riding in a taxi on Seymour Street in Vancouver. It was raining and all the prostitutes were standing under the awnings. “Mom,” said the boy, “what are all those women doing?”

“They’re waiting for their husbands to get off work,” she replied.

The taxi driver turns around and says, “Geez lady, why don’t you tell him the truth? They’re hookers, boy! They have sex with men for money.”

The little boy’s eyes get wide and he says, “Is that true, Mom?” His mother, glaring hard at the driver, answers in the affirmative.

After a few minutes, the kid asks, “Mom, what happens to the babies those women have?”

“Most of them become taxi drivers,” she said.

Clarence

XXXX