The ASX 200 kicked 23 points higher in an afternoon rally closing at 7417 (0.3%). US markets closed tonight for Martin Luther King Day. Banks rose led by CBA up 0.3% and the Big Bank Basket up to $180.80. MQG strong again and fund managers doing well with MFG up 4.2%, PDL bouncing back 7.8% and PPS up 4.2%. Healthcare better with CSL up 0.8% and COH up 1.5%. Industrials too in demand after WES guidance in line with market forecasts, WES rose 2.6% and ALL up 2.5% with TLS pushing ahead again up 0.7%. Miners were slightly on the nose despite Chinese GDP coming in better than expected at 4% in the last quarter. BHP down 1.1% and FMG off 2.8%. Lithium stocks look to be topping out with PLS up 1.1% and MIN down 1.0 % with energy stocks in demand, STO up 1.0% and WPL up 1.7%. Gold miners slipped slightly with NCM off 1.2% and NST falling 2.2%. Tech better but about time, the All–Tech Index up 0.7%. In corporate news, WES talked the impacts of omicron on staffing and foot traffic PDL revealed a new chair, AEF updated FUM with a small rise and PGL quarterly report helped it move 13.8% higher. In economic news, dwelling approvals rose 3.6%. Asian markets better in the main. 10-year bonds on the move again with a 6bps rise to 1.91%. US markets closed for Martin Luther King Day tonight.
- Winners: BWX, MAF, PDL, OMH, ABC, DEG, SGF, ADO
- Losers: BLX, IHL, AVZ, LKE, PRU, OPH, MGX.
- Positive sectors: Banks. Tech. Healthcare. Industrials. Oil and gas.
- Negative sectors: Iron ore miners. Gold miners. Base metals.
- Hi 7429 Lo 7386.
- Big Bank Basket: Rallies to $180.80 (0.4%)
- All-Tech index: Up 0.7%
- Gold: Higher at $2524.
- Bitcoin: Slightly lower to US$42697
- Aussie Dollar: Steady at 72.10c 10-YEAR YIELD: Rises to 1.91%.
- Asian Markets: Japan up 0.8% Hong Kong down 0.6% and China up 0.8%.
- US Futures: Dow futures down 39 NASDAQ futures down 40.
STOCKS ON THE MOVE
- BWX +11.80% good bounce after CEO transition
- MFG +4.22% Fund managers starting to find friends.
- MAF +7.93% earnings upgrade.
- DEG +7.03% rally continues.
- PDL +7.80% new chair.
- ABC +7.17% Alcoa deal extended.
- NHC +4.35% WHC +4.29% coal price upgrades.
- RNU +21.28% kicking again.
- COB +27.72% decent volume but no announcements.
- STA +12.96% Coburn project reaches 50% completion.
- PGL +13.75% quarterly activities report.
- AZL +18.18% name says it all.
- AVZ -6.49% profit taking.
- MGX -4.26% iron ore cools.
- MI6 -11.43% quarterly activities report.
- AXE -7.87% profit taking.
- ASO -12.50% acquisition of additional ground at Edleston project.
- IPO Dog of the Day: Before Pay (B4P) -44.13% issued at 341c and some heavyweight Ex WBC people behind it plus James Spenceley couldn’t save the day.
- Speculative stock of the Day: Lunnonmetals (LM8) +33.64% good volume following drilling results of 7m @9.22% Nickel only 120m below surface at Baker Delights.
IN THE NEWS
- Wesfarmers (WES) expects first-half profit between $1.18bn-$1.24bn which it says is in line with current consensus estimates. FactSet has an estimate of $1.28bn which is slightly above WES’s guidance. Management noted retail trading conditions weakened in the last two weeks of the calendar year. Added customer traffic has remained subdued during the first half of January. Pressure on supply chains and staff absenteeism was also highlighted. Kmart and Target trading performance was significantly impacted by COVID in the first half of FY22. In FY21 Kmart contributed ~29% to group revenue.
- Senex (SXY) – completed its acquisition of undeveloped Australia Pacific LNG gas fields PL 209 and PL 445.
- Pendal Group (PDL) Chairman James Evans retires. Director Deborah Page appointed Chair.
- RBC has raised its commodity price forecasts by an average of 24% for this year and 16% for 2023. It raised its iron ore forecast for the first half of this year by 44% to $US122 a tonne. Top picks BHP, SFR, NST and RRL.
- Regis Healthcare (REG) – Says the environment is still ’challenging’. Average occupancy for the first half of FY22 was 89.3 per cent based on 7104 average available beds.
- Centuria Industrial REIT (CIP) has acquired six industrial assets across Australia’s eastern seaboard with a combined value of $132.4m.
- Australian Ethical (AEF) increased funds under management (FUM) by 6% to $6.94bn for the December quarter, up from $6.54bn as of September 30.
- Prospa (PSP) -First-half revenue rose 41% to $78.5m. EBITDA will be around $9m against $4.1m in the first-half of 2020-21. Prospa’s gross loans hit a record $514.6m for the quarter, up 16.4%, and average gross loans were $469.2m, up 7.4%, for the second-quarter of financial 2022.
- Praemium (PPS) – quarterly inflows of $1.25bn, taking its annual inflows in calendar year 2021 to $4.9bn up 87% on the previous year. PPS achieved record total FUA of $49bn.
ECONOMIC NEWS/ BOND MARKETS
- RBC has cut its GDP forecasts for Australia’s first quarter by almost 1% to just under 1%.
- The seasonally adjusted estimate for total dwellings approved rose 3.6% in November. Private sector houses rose 1.4%, while private sector dwellings excluding houses increased 9.7%. The value of non-residential building approved rose 28.3%.
- Chinese GDP rose 1.6% over the quarter to December, beating estimates of a 1.1% rise.
- China’s retail trade eased to 1.7% year-on-year in December, down from 3.9% in November and missing market expectations of 3.7%.
- December unemployment in China came in at 5.1% missing expectations of 5%.
- China cut its key interest rate for the first time in almost two years. The 10 basis-point reduction was announced shortly before GDP number was released.
- Japanese power prices are rising as cold weather
- Bloomberg Index of casino shares jumped as much as 12% today the most in more than six years. The new rules will give licenses for 10 years, with the possibility to extend by another three years.
US AND EUROPEAN NEWS
- Credit Suisse chair resigns over CV10 quarantine breaches.
- Sweden is sending troops to Gotland as Russia ups the activity in the Baltic.
- European sales of EVs overtake sales of diesel for the first time.
- UK markets closed tonight for MLK day holiday.