The ASX 200 rose 69 points to 7314 (0.95%) after the RBA keeps rates unchanged and turns a little cautious dropping reference to a date for conditions to allow rate change. The market rallied strongly on the news. Banks kicked higher with the Big Bank Basket up to $174.38 (0.8%) with BOQ doing well post an update, up 4.2%. CBA up 0.4% and MQG kicking along up 0.2%. Industrials firmed across the board. ALL up 1.9% , WES up 0.5% and BXB up 1.6%. Tech bounced back strongly in places, Z1P up 9.9% on a trading update, APT moved 1.8% higher and XRO better by 2.4%. The All-Tech Index up 1.5% Healthcare also looking rosy with CSL shrugging off Mexican issues and rising 1.9%. SHL and RHC also doing well. In the miners, gold was flat, iron ore stocks rose eventually on Chinese data with BHP up 0.9% and FMG up 1.5%. Energy stocks did well on the crude rally, STO/OSH look to have sealed the deal, both up strongly. WPL gained 2.0% too. Lithium stocks mixed with AKE down 0.1% and PLS rising 0.4%. In corporate news, MFG fell 6.4% after the CEO resigned. IAG rose 1.4% after reaffirming guidance and BOQ up 4.2% after a business update. 10 -year yields rose to 1.64% and the AUD firmed on RBA and Chinese data.
- Winners: AVZ, CXO, PBH, Z1P, TLX, PPK, ABR, LKE
- Losers: ASM, MFG, SIG, NIC, AEF, APM, ERD, CEN.
- Positive sectors: Iron ore miners. Oil. Banks. Insurers. Healthcare. Tech
- Negative sectors: Selected fund managers. Rare earths.
- High 7326 Low 7253.
- RBA leaves rates unchanged as expected. Omicron poses slight threat.
- China’s exports grew faster than expected in November to hit a record
- Big Bank Basket: Up to $174.38 (0.8%)
- All-Tech index: Up 1.5%
- Gold: Weaker at $2513.
- Bitcoin: Rallying to US$51081
- Aussie Dollar: Higher at 70.78c on RBA comments. 10-YEAR YIELD: Higher at 1.64%.
- Asian Markets: Japan up 2.0% Hong Kong up 1.7% and China down 0.1%.
- US Futures: Dow futures up 146 NASDAQ futures up 43
STOCKS ON THE MOVE
- AVZ +14.16% CXO +11.58% lithium depression lifts
- Z1P +9.91% rare moment in the sun following business update.
- VUL +6.23% INR +7.83% strong bounce back.
- PBH +9.92% signs of a pulse.
- NEU +91.18% positive Phase III trial results.
- TNT +16.67% acquisitions.
- PH2 +25.3% H2X releases POWER H2 portable power units.
- FYI +10.91% week 2 of HPA extended pilot plant trial commenced.
- RVS +32.95% CEO summit presentation.
- TLX +9.87% strong bounce.
- ASM -8.86% Dubbo optimisation plan.
- SIG -5.15% broker downgrades.
- MFG -6.37% mystery CEO resignation.
- LYC -3.15% run way too hard.
- KLL -6.25% sell off continues.
- Speculative stock of the Day: Pure Hydrogen (PH2) +25.30% H2X releases POWER H2 portable power units. Good volume.
IN THE NEWS
- Bank of Queensland (BOQ) expects a slightly lower Net Interest Margin (NIM) than previously guided. Tougher trading conditions, including yield curve volatility arising post the RBA removal of yield curve control, intense price competition, increased fixed-rate lending and higher liquid asset balances the culprits. Previous guidance released in its full-year results was for NIM to decline by ~5-7bps in FY22. BOQ also reconfirmed FY22 guidance of at least 2% positive jaws.
- Insurance Australia Group (IAG) reaffirms FY22 reported margin and gross written premium guidance.
- Northern Star Resources (NST) reinstated as a BUY at UBS. The previous rating was neutral. The change in recommendation due to a change in analyst. Target is $11.20, 23% upside implied.
- Afterpay (APT) announces partnership with Rakuten
- Johns Lyng Group (JLG) is looking to raise $150-200m through JP Morgan to help fund an acquisition in a trading halt until Monday.
- Magellan Financial Group (MFG) CEO Brett Cairns resigns due to personal reasons. CFO Kirsten Morton appointed as interim CEO.
- AMP has sold its MoneyBrilliant personal finance app to WBC for a small sum of money.
- Alcidion (ALC) – Capital raising for UK acquisition of Silverlink an NHS provider.
ECONOMIC NEWS/ BOND MARKETS
- ANZ-Roy Morgan Consumer Confidence increased 1.5pts to 107.5 on the first weekend of December.
- The RBA has decided to maintain the cash rate target at 10bps and the interest rate on exchange settlement balances at zero per cent.
- The Omicron strain is a new source of uncertainty, but it is not expected to derail the recovery.
- Leading indicators point to a strong recovery in the labour market. A further pick-up in wages growth is expected as the labour market tightens. This pick-up is expected to be only gradual but there is still uncertainty in the outlook.
- Household consumption is rebounding strongly.
- Inflation has increased, but, in underlying terms, is still low.
- It will continue to purchase government securities at the rate of $4bn a week until at least mid-February 2022. Expectations are for purchases to be cut back to $2bn a week from February.
- The Board will not increase the cash rate until actual inflation is sustainably within the 2 to 3% target range. This will require the labour market to be tight enough to generate wages growth that is materially higher than it is currently.
- New York Governor Kathy Hochul is ordering about 30 hospitals in the state to halt elective surgeries amid a surge in Covid-19 admissions.
- France will close nightclubs for four weeks and open vaccination to vulnerable kids.
- China’s exports grew faster than expected in November to hit a record. Exports rose 22% in dollar terms from a year earlier to almost US$326bn. Imports grew 31.7%, leaving a trade surplus of US$71.2bn.
- Alibaba kicked off a decent rally in Asian tech stocks today. The Hang Seng Tech Index gained as much as 2.7%.
- China has said the new variant Omicron will not disrupt the Winter Olympics.
US AND EUROPEAN NEWS
- 80 years ago today Japan launched its attack on Pearl Harbour.
- Biden will be calling Putin to tell him what sanctions the US will impose on Russia whilst the Ukrainian build up continues.
- Saudi Aramco says that there will be ‘social unrest’ if oil and gas are ditched too quickly.
- SEC investigating Lucid over its SPAC deal.
- What did Snow White say when she came out of the photo booth? Someday my prints will come.
- A girl said she recognized me from her vegetarian club, but I’d never met herbivore.
- Dad, are we pyromaniacs? Yes, we arson.
- I’ve always had an irrational fear of speed bumps but I’m slowly getting over it.
- What word becomes shorter when you add two letters to it? Short.
- I’ve finally told my suitcases there will be no holiday this year. Now I’m dealing with the emotional baggage.
- If you’re not supposed to eat at night, why is there a light bulb in the refrigerator
- My dad died when we couldn’t remember his blood type. As he died, he kept insisting “be positive,” but it’s hard without him.