The ASX 200 slid 75 points lower to 7211 (-1.0%) as banks wobbled despite bond yields rising. A 20 point sell-off on close not helping. The Big Bank Basket fell to $184.53 (-2%) as the AFR Banking Summit brought out the bears. NAB down 1.9%, CBA off 2.1% and insurers also falling on negative industry comments, SUN down 6.4% and QBE off 2.3%. Financial also suffering as MQG fell 1.1% and MFG down 2.9%. Industrials too in the naughty corner today with consumer stocks slipping slowly, WES down 1.0%, WOW off 0.8% and QAN down 1.8% as oil continues to surge higher. Healthcare also in A&E today with CSL down 0.8% and SHL falling 1.2%. Tech slipped, the AllTech Index down 2.0% with XRO and WTC lower, BNPL once again slid with ZIP down 6.2% and SZL off 3.5%. In resources, some green on the screen, RIO and FMG better with base metals and lithium stocks holding firm but oil and gas stocks slipped a little, WOR down 2.8% and WDS off 1.6%. In corporate news, KLL rose 13.6% on a Beyondie update, WGN up 11.8% on a contract win in Sydney. On the economic front, plenty for analysts to digest with consumer confidence, Balance of Payments (BOP) and Chinese PMIs to keep us on our toes. Asian markets mixed ahead of US reopening Japan down 0.5% China up 0.8% and HK up 0.9%. 10 -year yields soaring to 3.35% on Chinese reopening.


End of Day Podcast – Tuesday, May 31


Headlines

  • Winners: ARU, SYA, BCB, PAN, BPT, AGY, SHV, DEG
  • Losers: SWM, TYR, SUN, TPW, ZIP, EML, MP1
  • Positive sectors: Coal. Iron ore (ex BHP). Base metals.
  • Negative sectors: Banks. Healthcare. Industrials. Telcos.
  • High 7288 Low 7211. Down 3.0% for May.
  • Huge volume day as Index Rebalancing in progress.
  • Oil higher in Asian trade on EU embargo.
  • Big Bank Basket: Smacked to 184.53 (-2%)
  • All-Tech index: Down 2.0%
  • Gold: Lower at $2576
  • Bitcoin: Better at US$31,717
  • Aussie Dollar: Stronger at 71.91c
  • 10-Year Yield:Soars to 3.35%
  • Asian markets: Japan down 0.5% China up 0.8% and HK up 0.9%
  • US Futures: Dow down 4, Nasdaq up 81

Major Movers

  • ARU +14.29% rare earths on a charge
  • AGY +5.10% Rincon operational update.
  • MAQ +6.21% thin as usual but going well.
  • DEG +4.63% Investor presentation.
  • WAF +3.59% hits 13m @5.3g/t Au at MV3.
  • VRT -0.49% BGH Capital has 50.45% now.
  • GRR +3.79% iron ore prices heading higher.
  • KLL +13.64% Beyondie update.
  • FLT -1.77% now 17.3% of the stock is shorted.
  • WGN +11.76% contract secured for Sydney Metro – Western Sydney Airport.
  • TEK +7.69% change of director’s interest.
  • GPR -45.24% back from suspension having reassessed Woodlark.
  • GAL -11.08% profit taking.
  • BUB -8.82% coming off the boil. Curdled.
  • Speculative Stock of the Day: Belerarox Limited (BRX) +16.36% 34 new targets expand Belara exploration area ten-fold.

In the News

  • ResApp (RAP) is in a trading halt related to the status of a $100m takeover bid from global pharmaceutical giant Pfizer. ResApp gave no details on the reason for the halt other than considerations around a draft independent expert report on the bid.
  • NextDC (NXT) interested in acquiring Global Switch’s APAC operation.
  • Dye & Durham no longer in talks to sell Link Group’s (LNK) RSS business to FNZ.
  • Speculation Qube (QUB) could be private equity takeover. Price tag of $5.7bn.
  • AMA Group (AMA) expects FY22 EBITDA between $12-17m vs consensus of $27.1m. Medium term guidance remains unchanged – FY24 projected as the first “clean” year
  • Nanosonics (NAN) chairman Maurie Stang to step down.

Economic News/Bond Markets

  • Weekly ANZ Roy Morgan consumer confidence index fell 0.1% to 90.7 points.
  • Australian building approvals fell a worse-than-expected 2.4% in April. Private sector credit topped expectations at 0.8% for April.
  • Australia’s current account surplus missed expectations of $13.2bn for the March quarter after it decreased by $5.7bn to $7.5bn (seasonally adjusted) in the March quarter.
  • Commonwealth Bank’s currency analysts expect the Australian dollar to buy US76¢ by the end of the June quarter.
  • The cost of a building a new house rose by a record $76,715 in April as supply chain and labour shortages added to the costs for home builders

Asian Markets

  • China’s purchasing manufacturers’ index of factory output beat economists’ forecasts at 49.6 for May, versus expectations of 49. The result in the lockdown-hit nation was the best since February.
  • Covid cases drop below 100 for the first time since March.

US and European Headlines

  • Todd Boehly completes takeover of Chelsea FC.
  • French CPI running a little ahead of expectations. 5.8% versus 5.4%. Euro area CPI may hit 7.7%
  • EU compromises on oil embargo with ship bound oil imports now banned from Russia.
  • Powell and Biden to meet tonight. Also Biden is meeting BTS, a K-Pop band and Jacinda Ardern. Busy and varied day. Good to be the king.
  • France apologises for botched security at Champions League final. Not something the French are renowned for.
  • No-confidence vote in Johnson ‘likely’ if Tories lose by-elections .
  • Biden has ruled out sending weapons to Ukraine that could reach Russia.

And finally…..

1.  Now that food has replaced sex in my life, I can’t even get into my own pants.

2.  Marriage changes passion. Suddenly you’re in bed with a relative.

3.  I saw a woman wearing a sweat shirt with “Guess” on it, I said “Implants?” She hit me.

4.  I don’t do drugs – I get the same effect just standing up fast.

5.  Sign in a Chinese Pet Store: “Buy one dog, get one flea.”

6.  I live in my own little world,  it’s OK, they know me here.

7.  I got a sweater for Christmas – I really wanted a screamer or a moaner.

8.  If flying is so safe, why do they call the airport the terminal.

9.  I don’t approve of political jokes – I’ve seen too many of them get elected.

10.  There are two sides to every divorce, yours and Shithead’s.

11.  I love being married, it’s so great to find that one special person you want to annoy for the rest of your life.

12.  I am a nobody and nobody is perfect, therefore, I am perfect.

13.  Every day I beat my own previous record for number of consecutive days I’ve stayed alive.

14.  How come we choose from just two people to run for president and 50 for Miss America.

15.  Having a smoking section in a restaurant is like having a peeing section in a swimming pool.

16.  Why is it that most nudists are people you don’t want to see naked.

17.  Snowmen fall from Heaven unassembled.

18.  Every time I walk into a singles bar I can hear Mom’s wise words, “Don’t pick that up, you don’t know where it’s been.”

19.  A good friend will come and bail you out of jail, a true friend will be sitting next to you saying, “Damn, that was fun.”

Clarence

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