The ASX fell 9 points to 7409 (0.1%) in cautious trade, flip flopping around from positive to negative as banks fell in the PM session. The Big Bank Basket fell to $180.36 (0.2%) with CBA leading the falls as a broker downgrade, the stock off 0.4% with NAB also down 0.1%. MQG joined in the slight sell off falling 0.4% and insurers also slid, MPL down 2.3% and IAG down 1.6%. Healthcare too under a little pressure as CSL slipped 1.6% towards the SPP price, COH down 1.6% and FPH off 1.3%. Industrials mixed, WES down 0.4%, ALL down 1.1% and TLS better by 0.2% with REITs unchanged. Tech was slightly better despite APT falling 0.7%. The All–Tech Index up 0.6%. In the miners, BHP rose 1.2% ahead of the crucial vote, whilst energy and base metal stock went sideways. Lithium remained in demand following a quarterly report from AKE and RIO had their quarterly today. In other corporate news, JBH showed its category killing power with a decent trading update moving 6.9% higher and DTL also doing well up 14.5% on a strong 1HFY22. The RBL burst today after a nasty business update with margins under pressure and sales of masks down, the stock tumbled 22.4% and IKE rallied 17.7% on its trading update although as usual volume was light. On the economic front, consumer confidence not unexpectedly fell hard on omicron woes in early January and international arrivals and departures rose to levels not seen since March 2020. In Asia, Japan down 0.1%, Hong Kong down 0.1% and China up 1.1%. 10-year yields at 1.95%.

MAJOR MOVERS:

• Winners: BRN, DTL, MNS, CXL, TRJ, IMU, AMI, JBH
• Losers: RBL, AVZ, ADO, KGN, RNU, MCR, BWX, PBH.
• Positive sectors: Lithium. Battery Tech. Rare Earths.
• Negative sectors: Banks. Financials. Industrials. Base metal.
• Hi 7445 Lo 7398
• Big Bank Basket: Falls to $180.36(0.2%)
• All-Tech index: Up 0.6%
• Gold: Higher at $2529.
• Bitcoin: Slightly lower to US$42059
• Aussie Dollar:  Lower at 71.89c 10-YEAR YIELD: Rises to 1.95%.
• Asian Markets: Japan down 0.1% Hong Kong down 0.1% and China up 1.1%.
• US Futures: Dow futures down 80 NASDAQ futures down 154.

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STOCKS ON THE MOVE

• BRN +25.68% the faithful are back and pushing. Huge volume again.
• DTL +14.46% expecting strong first half earnings growth.
• MNS +10.28% battery tech back in fashion.
• CXL +8.70% finds support and bounces hard.
• JBH +6.86% positive business update.
• NVX +6.02% battery tech.
• CRR +20.88% acquisition of Graphic Lake lithium project.
• IXR +14.39% ARR +13.21% names say it all. Rare earths.
• AZL +7.69% rally continues.
• RBL -22.41% well and truly burst. Cannot mask that fact.
• AVZ -7.51% profit taking continues.
• KGN -7.13% JBH winning KGN losing perhaps.
• BWX -3.69% retracement after recent bounce.
• PBH -3.65% sell off resumes.
• Z1P – 3.43% continues to fall.
• TIG -16.67% appointment of NED.
• MMM -9.38% pricing pressures and supply chain.
• COB -9.30% run hard and fast.
• ADO -7.46% profit taking as new RATs arrive.
• Speculative stock of the Day: Charger Metals (CHR) +25.52% good announcement yesterday on its Brynoe project and the potential for a large lithium system.

IN THE NEWS

• Allkem (AKE) trading update. Mt Cattlin’s strong performance continues as does positive lithium pricing momentum. Shipments exceeded guidance in the 2021 calendar year. Lithium carbonate prices for H2 FY22 are expected to be ~US$20,000/t FOB up ~80% on the H1 FY21. Total capital expenditure for the Olaroz expansion has been revised up by 10-15% to US$365-380m. ALK continues to experience very strong demand for its spodumene concentrate and lithium carbonate as supply-side tightness persists in raw materials and throughout the battery supply chain.
• Ampol (ALD) Q4 Lytton Refiner Margin (LRM) US$11.24/bbl vs quarter-ago US$6.76/bbl. A solid improvement over the quarter. LRM represents the difference between the market value of importing a standard Lytton Refinery basket of products and the cost of importing the crude oil required to make that product basket. Q4 refinery production 1,585ML vs quarter-ago 1,565ML. The Lytton Refinery is expected to deliver one of its best quarterly results in more than four years. Full-year results will be released on February 21. ALD does not expect to receive a Fuel Security Service Payment for production during 4Q 2021.
• JB Hi-Fi (JBH) preliminary half-year results. Profit $287.9m vs year-ago $317.7m. While down on the year, the number was ahead of consensus of $266.4m. Revenue of $4.86bn beat consensus of $4.72bn. Q2 comparable sales vs year-ago: JBH Australia +1.2%, JBH New Zealand down 3.4%, The Good Guys +2.8%. 67% of its revenue last year came from its Australian operations, only 2.7% came from its NZ operations so the drop in comparable sales isn’t likely to have too much of an influence. Sales momentum was strong throughout the half, with continued heightened customer demand. CEO Terry Smart, pleased to report strong sales and earnings for HY22 given challenging circumstances. Online sales now account for more than 22% of sales, a big jump on last year 13.7%.
• LIC Mirrabooka delivered a 26.1% return in calendar 2021, beating the 19.8% return from the small and mid-cap 50 benchmark.
• RIO – The company reported iron ore production of 319.7m for the year, down 4%= from 2020. It said it could grow Australian iron ore exports by up to 4% in 2022. In production report today Rio’s iron ore division delivered its weakest annual output since 2015 and suffered delays in delivering new mines.
• Redbubble (RBL) – It said profits for the first half of the 2022 financial year that ended in December fell by a quarter from the prior period and warned that revenue from its marketplace platform would decline for the full financial year.

ECONOMIC NEWS/ BOND MARKETS

• Weekly consumer confidence took a 7.6% hit as case numbers around the country surged. The index is now down below the neutral level of 100. The weakest January result since 1992. ANZ said it doesn’t think the economy is as weak as the data might suggest.

• Overseas arrivals and departures hit their highest level since travel restrictions were introduced in March 2020. The ABS said the lift was due to the easing of restrictions 1 November, allowing fully vaccinated Australian citizens and permanent residents to travel to and from Australia without an exemption. There were 197,000 overseas arrivals to Australia and 229,000 overseas departures in December 2021. Still a long way to go before we are anywhere close to pre-pandemic numbers.

CV19 NEWS

• Victoria has declared a so-called “code brown” across all metropolitan and major regional area hospitals as the surge in virus infections strains its healthcare system.
• A fourth dose of the Pfizer-BioNTech vaccine was not sufficient to prevent infection with the omicron variant of Covid-19, according to preliminary data from a trial in Israel.
• China halted ticket sales to the general public for the 2022 Winter Olympics, now it will be invite only.

ASIAN MARKETS

• The BoJ left policy settings unchanged though adjusted its view of inflation risks for the first time since 2014. Clearly the Japanese economy is used to aggressive money printing after all these years.

• Samsung has introduced its first mobile processor powered by AMD as it goes toe to toe with Apple. It is the industry’s first mobile chip with hardware support for ‘ray tracing’, an advanced approach to high-fidelity graphics.

US AND EUROPEAN NEWS

• US back on stream tonight. Oil prices at 7-year high. UAE drone strike helps.
• US bond yields pushing towards a 2-year high.
• US airlines are warning of potential chaos as 5G interferes with services.
• Fauci says it is too soon to say whether omicron is the final phase of the pandemic.
• Unilever facing backlash over plans for GSK consumer unit.

And finally….

Clarence

XXX