The ASX 200 rose just 8 points to 7304 (0.1%) as enthusiasm waned into the weekend, big sell-off in the last hour or so. Banks and miners drove the gains as tech/growth crumbled. The Big Bank Basket rose to $176.11 (1.5%) with CBA up 2.4% and ANZ rallying 0.7%. Insurers were better with QBE seeing some bargain hunting up 0.2% and IAG better by 0.9%. Miners saw good solid gains after a rise in commodity prices. Gold miners were in demand with NCM up 3.7% DEG up 5.1% and NST rallying 5.6%. Iron ore giants BHP rose 1.8% and FMG up 1.0% with base metals also better, IGO up 1.2% and NIC up 2.3%. Energy stocks also finished a lacklustre week on a higher note, WPL up 0.6% and STO rising 0.6%. Tech stocks and high PE wannabes were mauled by a Nasdaq bear following large falls on Wall Street and a probe launched in the US into the BNPL sector. APT fell 7.6% and Z1P down 6.1%. XRO also under pressure down 4.7% as darlings like CXL fell hard by 5.6%. The All–Tech Index was 3.4% lower. Nasty. In the industrials, we saw some book squaring in the consumer staples like WOW up 0.7% and COL up 0.3%. Healthcare weaker with CSL below the issue price down 0.3%. In corporate news, TCL fell 1.0% after settling for a $2bn hit on its tunnel dispute. BNPL stocks whacked on US probe. Nothing on the economic front.  10-year yield rises to 1.60%.

Major Movers:

  • Winners: RED, LKE, AVN, SDR, NST, IRE, CIA, VUK
  • Losers: DUB, SZL, DHG, BET, NTO, APT, 360. BLY
  • Positive sectors: Iron ore. Gold miners. Energy. Base metals. Banks. 
  • Negative sectors: Healthcare. Industrials. Tech. Growth stocks
  • High 7350 Low 7298. Index rebalancing at the close
  • ASX 200 down 50 points for the week. 
  • Big Bank Basket: Roars ahead to $176.61(1.5%)
  • All-Tech index: Drops hard by 3.4%
  • Gold: Rallies to $2514
  • Bitcoin: Slightly weaker at US$47860
  • Aussie Dollar:  Steady at 71.65c
  • 10-Year Yield: Rises to 1.60%.
  • Asian Markets: Japan down 1.5% Hong Kong down 1.1% and China down 0.9%.
  • US Futures: Dow futures down 52  NASDAQ futures down 40

Stocks on the Move

  • AKP +27.37% better volume and promising announcement.
  • DEG +5.07% good drill results.
  • RED +9.43% KOTH coming soon.
  • CIA +5.53% iron ore bounce.
  • CGC +4.81% turning a corner.
  • ALK +23.08% high grade continuity.
  • BNO +17.39% pricing of IPO in US.
  • ADN +5.88% Great White Kaolin project – mining lease granted.
  • DUB -12.58% comes undone.
  • DHG -8.51% tech sell off and housing fears.
  • SZL -9.91% Z1P breaks off talks.
  • 360 -7.25% Nasdaq afflicted.
  • BET -8.43% no where to run.
  • APT -7.63% Z1P -6.07% US probe launched into sector.
  • LCK -14.29% capital raising.
  • HLO -6.88% goodbye again.
  • IPO of the Day: IPG Group -11.67% not a great start. It’s a national distributor
    for over 30 innovative international equipment and technology manufacturers. products and services that IPD supplies are used in the construction, operation and maintenance of electrical infrastructure.
  • Speculative stock of the Day: Carnaby Resources (CNB) +55.17% – Spectacular copper discovery at Greater Duchess in QLD. 34m down hole zone of copper sulphide including a 24m zone of mostly semi massive copper sulphide

In the News

  • Afterpay (APT) proposed takeover by Block has been approved by the NSW Supreme Court. The proposal still needs approval from the Bank of Spain.
  • Healius (HLS) – Virtus Health decides not to proceed with the acquisition of Adora due to ACCC uncertainty.
  • Nufarm (NUF) reports expectations to deliver revenue and earnings growth in 2022 at AGM.
  • Transurban Group (TCL) provides an update on the West Gate tunnel settlement. It looks like TCL will have to cough up an extra $1.7bn with Victorian taxpayers to pay $1.7bn to finish the project. TCL will retain the right to liquidated damages if the project is not delivered by the new completion date. No changes to concession rights or tolling arrangements. Its contribution to the adjustment and the remaining original capital contributions will not commence until FY23 and is not expected to impact free cash. The release also included a traffic update. Observed volumes are improving across all markets, with the recovery trend particularly evident in Sydney and Melbourne following the lifting of restrictions during October.
  • BNPL under pressure after the US regulator, the Consumer Financial Protection Bureau(CFPB) issues a set of orders to Zip Co, Affirm, Afterpay, Klarna, PayPal.
  • EML Payments (EML) notes media reports on a class action launched by Shine Lawyers. The proceedings apparently relate to whether EML failed to disclose information about correspondence received in May 2021 from the Central Bank of Ireland (CBI) in a timely manner.
  • CIMIC (CIM) reaches a settlement over the West Gate tunnel dispute. Repeats FY21 guidance, sees statutory underlying profit in FY21 of $400-$430m. Expects the financial impact from the West Gate settlement and other project risks to be offset by existing provisions and other non-recurring gains from the period. The removal of some uncertainty and a clear path forward without further potential for legal and other costs likely to be taken as a positive.
  • Healius (HLS) to acquire bioanalytical laboratory, Agilex Biolabs for an enterprise value of $301.3m.

Economic News/Bond Markets

  • Total household wealth (net worth) rose by $590bn or 4.4% to a record high $13,918.5bn in the September quarter.
  • The sophisticated investor test may be overhauled. Industry figures have reportedly called for the threshold to be ‘beefed up’, with the Financial Services Council proposing a $5m asset test and fund manager Geoff Wilson suggesting it be replaced with a financial knowledge test. Under the current law, an investor can be deemed sophisticated if they have $2.5m in assets (including the family home) or earn more than $250,000 gross income in two consecutive years. The housing boom has made a massive number of Australian’s eligible. In 2002, less than 2% of the population was considered eligible, now 16% of the population are.

CV19 News

  • France and Germany have no plans to introduce requirements that vaccinated visitors from other European Union countries take PCR tests, even as Italy and Greece have imposed such a rule.
  • In NSW daily cases surged to a record 2,213 on Friday, from 158 a week earlier. In Victoria, cases remained steady Friday at 1,510, with 386 hospitalised and 82 active ICU cases.
  • President Biden said Americans that were unvaccinated Americans face “a winter of severe illness and death.”

Asian Markets

  • BOJ leaves rates unchanged.
  • Chinese Spies accused of a secret Australian telecom hack through Huawei back in 2012.
  • China’s southern Guangdong province is tightening Covid restrictions after a new cluster of infections emerged in the country’s manufacturing hub.
  • China’s financial regulator is coordinating negotiations between Shimao Group and some trust firms for loan extensions.

US and European News

  • European markets opening weaker.
  • Quadruple witching tonight in US.
  • French closing borders to UK as Omicron spreads rapidly.
  • A US Judge has overturned a US$4.5bn opioid related settlement with Purdue Pharma bankruptcy.
  • Turkey has raised minimum wages by 50% to help workers cope with inflation.
  • Oracle close to a deal to buy health IT company Cerner for US$30bn.
  • US airlines complaining of 5G interference.
  • Delta Airlines (somewhat ironic) warns of hit to air travel due to Omicron.
  • Biden says it will take weeks to pass the ‘Build Back Better’ Bill.