The ASX 200 dropped 50 points to 7405 (-0.7%) with selling across the board on RBA minutes and commodity weakness. Banks were soft as yields pushed a little higher. CBA down 0.3% and NAB off 0.6% with the Big Bank Basket under pressure at $188.08 down 0.3%. Other financials and insurers also wavered with MQG off 0.3% and MFG falling another 3.0%. Healthcare in ICU today with RMD down 2.9% and CSL losing 0.8% and RHC off 0.6% on NHS issues with CV19 cases in the UK hurting sentiment. Industrials eased but no real damage WES fell 0.6% and ALL off 0.9% with REITS slipping slightly and Tech mixed. APT rose 1.7% following Square higher and XRO fell 0.2% and WTC off 0.4%, the All–Tech Index up 0.1%. Miners also underwater led lower by BHP down 2.6% and RIO down 2.2% as iron ore slipped again in China. Gold miners came off the boil and base metal stocks like IGO and OZL were slightly weaker. In corporate news, TLS fell 1.3% after its investor day and plenty of AGMs around. CXL up 11.20% on CEO comments, IMU gained 3.5% on a clinical trial supply agreement and WPL dropped 0.8% as the CFO jumped ship to NCM. Sign of the time perhaps. The 10-year yield modestly higher at 1.82% on Governor Lowe’s comments on rate rises at a slow pace and certainly not next year.

MAJOR MOVERS:

  • Winners: CXL, CTT, KED, RAC, SM1, CHN, IMU, 360
  • Losers: MSB, SYA, LTR, ALG, JRV, IMM, PPM, OMH
  • Positive sectors: Few and far between.
  • Negative sectors: Banks. Miners. Healthcare.
  • High 7460 Low 7404.
  • Big Bank Basket: Lower at $188.08
  • All-Tech index: up 0.1% APT up 1.7%
  • Gold: Higher at AUD$2536
  • Bitcoin: Smacked to US$61266
  • Aussie Dollar:  Steady at 73.53c. 10-YEAR YIELD: Rallies to 1.82% on RBA comments.
  • Asian Markets: Japan up 0.17% Hong Kong up 0.94% and China down 0.17%.
  • US Futures: Dow futures down 8 NASDAQ futures up 8

FUTURES HIGHS AND LOWS

STOCKS ON THE MOVE

  • APM +3.2% good bounce back.
  • CXL +11.2% CEOs AGM presentation.
  • IMU +3.48% clinical supply agreement.
  • CTT +7.71% Xmas is coming.
  • RED +1.79% buyers back.
  • DGL +3.05% broker upgrade.
  • LMG +21.74% buyers step back in.
  • ACW +5.88% good push higher. Plenty to like.
  • LCY +78.95% Hancock earns into Mt Bevan IO project.
  • MSB -8.68% rethink perhaps.
  • LTR -5.78% profit taking.
  • JRV -5.17% TSXV management discussion.
  • ALG -5.29% Queensland CV restrictions.
  • FDV -4.01% base metal falls.
  • ILU -4.05% conference presentation.
  • RXM -7.02% chairman’s address.
  • IVX -7.41% capital raising and presentation.
  • AGY -4.69% profit taking.
  • IPO of the Day: EV1 +210.00% solid start with good volume. Buys Graphite project in SE Tanzania. Tightly held and undervalued float.
  • Speculative stock of the Day: Hawthorn Resources (HAW) +34.72% Hancock earns in to Mt Bevan.

IN THE NEWS

  • Woodside (WPL) – Sherry Duhe, the CFO, has jumped ship to NCM in the middle of BHP merger. Not a good look.
  • Sezzle (SZL)Q3 EPS -9c (US$) vs year-ago -4c (US$).
  • Mirvac (MGR) reaffirms FY22 dividend guidance of10.2c, up 3% vs a year ago. Sees operating EPS of at least 15c.
  • Best & Less Group (BST) said it does not expect to achieve H1 prospectus guidance. Has lost a total of 9,272 trading days due to COVID restrictions.
  • SRG Global (SRG) secures seven term contracts valued at ~$110m.
  • Beach Energy (BPT) appoint Anne-Marie Barbaro as acting CFO.
  • Imugene (IMU) announces new clinical trial supply agreement with Merck and Pfizer inc.
  • G8 Education (GEM) Chairman Mark Johnson to retire, David Foster appointed replacement, he is the former CEO of Suncorp (SUN).
  • Telstra has an investor day. Its T25 scorecard highlighted expectations for mid to single-digit underlying EBITDA growth from FY21-FY25. Added it sees EPS growth in the high teens to FY25. TLS two weeks ago inked a $1bn five-year deal with the department of defence.
  • Sydney broker EverBlu offices raided by Federal Police.

ECONOMIC NEWS/ BOND MARKETS

  • RBA minutes – The RBA noted the lift in inflation but added it remained low in underlying terms. A gradual pickup in underlying inflation is expected on the back of supply chain pressures. Observed wages growth remained subdued but were likely to improve as the labour market tightens. The main uncertainties related to the persistence of the current disruptions to global supply chains and to the behaviour of wages at the lowest unemployment rate in decades. Members discussed the Bank’s decision to stand out of the market in the days between the CPI release and the meeting. Noting it had resulted in uncertainty about the Bank’s policy intentions and had affected market pricing and liquidity for a period. Inflation on a sustainable basis between 2-3% and materially higher wages are the key milestones before a rate rise. No rise in FY22 expected.

CV19 NEWS

  • NT mandates masks after 9 new cases.
  • Japanese CV19 cases hit 17-month low.

ASIAN MARKETS

  • Jamie Dimon allowed to skip HK quarantine.
  • Goldman Sachs, Nomura Holdings and Barclays to cut their Chinese growth forecasts in 2022 to below 5% due to the authorities move on the real estate sector.

US AND EUROPEAN NEWS

  • European markets opening modestly lower across the board.
  • The choice between Brainard and Powell is coming down to the wire. Yellen favours Powell.
  • Buffett’s Berkshire Hathaway Inc. cut two of its payment bets – holdings in Visa Inc. and Mastercard Inc. The company’s Visa and Mastercard holdings were cut 4.3% and 6% respectively.
  • Biden and Xi call for cooperation in virtual summit. Xi wants US to move to more friendly basis.
  • Musk has exercised around US$930m worth of options and sold the stock.
  • Dutch government trying hard to keep the ‘Royal’ in Shell and the HQ in Holland.
  • Russia warned of serious consequences if any hostilities over Ukraine. But then again Europe needs the gas.

And finally….

Clarence