ASX 200 jumped on better US markets with the index closing up 127 points (+1.9%) as buyers rushed in and window dressing for EOFY took hold. Banks were the major drivers with the Big Bank Basket gaining 3.5% to $164.16. CBA up 4.0% and NAB up 3.4% were the standouts. Insurers also rise with IAG up 0.9% and SUN up 3.6% on demerger talk of the banking business. MQG up 0.6% with NWL rallying 4.8%. Healthcare also in demand with CSL up 0.7% and RHC doing well up 3.0% on media reports of continued PE interest. REITs in demand, GMG up 1.0%. Industrials also in demand as bond yields remained steady at lower levels, ALL up 3.8% WES bouncing 0.8%, COL up 0.6%, TLS up 1.0% and SEK rising 4.1%. Tech stocks too in demand, XRO up 1.2%, WTC up 0.9% and the AllTech Index up 2.5%. In resources, we saw money rush back into base metals and iron ore stocks, BHP up 3.0%, FMG up 3.5% and S32 up 1.3%. Lithium stocks continuing to find friends, PLS up 4.0% and MIN up 1.1%. CXO the standout in the sector, up 12.0%. Energy stocks also doing well, STO up 2.2% and WPL rising %. Coal back in demand on increasing coal pricing ex Newcastle. WHC up % and YAL rising 0.4%. Gold miners were the only losing sector today as EVN announced production issues and the sentiment spread across the sector, EVN fell 21.9%, NCM down 5.6% and GOR off 4.2%. In corporate news, IMU rose 45.45% on some very positive trial results, SYA up 12.0% on new lithium discoveries, CAR in a trading halt raising $1.2bn in an entitlement issue to buy US Trader Interactive and BWX doing a capital raise to pay down debt after covenants broken. MTS rose 4.1% on its results. Nothing on the economic front today but yields up slightly at 3.77%. Asian markets better across the board.

Headlines

  • Winners: IMU, PBH, CXO, SYA, LTR, TUA, INR, MP1
  • Losers: ERA, EVN, NST, 5EA, RMS, NCM, OMH
  • Positive sectors: Everything.
  • Negative sectors: Gold miners.
  • High 6716 Low 6603
  • Big Bank Basket: Rises to $164.16 (+3.5%)
  • All-Tech index: Up 2.5%.
  • Gold: Drifts to $2649
  • Bitcoin: Drifting higher to US$21216
  • Aussie Dollar: Higher at 69.26c
  • 10-Year Yield Climbed to 3.77%.
  • Asian markets: Japan up 1.1%. HK up 2.3% China up 0.9%
  • US Futures: Dow up 17 Nasdaq up 20 – European markets opening higher.

Major Mover

  • IMU +45.45% positive trials results.
  • CXO 12.02+% lithium bounce. State Street moves to substantial.
  • PBH +12.45% bouncing all over the place.
  • SDR +8.91% Macquarie upgrades.
  • LNK +4.07% Dye and Durham cuts LNK offer to 430c.
  • SUN +3.60% speculation of bank sale.
  • CAR – mops up Trader Interactive in US.
  • SYA +12.00% new lithium discoveries.
  • MP1 +9.11% solid bounce.
  • LTR +11.28% ASM +7.32% speculative punters back.
  • BWX – firesale equity raising.
  • LLL +18.56% roaring ahead.
  • AGE +4.35% change of director’s interest
  • EVN -21.89% downgrades production.
  • NST -12.14% RMS -5.91% GOR -4.17% gold well and truly on the nose.
  • FWD -20.93% June results update.
  • SPL -8.33% signs DEP research agreement with US biopharma.
  • AR1 -9.60% change of management.
  • Speculative Stock of the Day: Widgie Nickel (WIN) +51.02% High grade nickel discovery at Gillett North.

In the News

  • Metcash (MTS) reports FY underlying profit up 18.6% to $299.6m vs consensus $279.4m. Revenue up 5.9% to $15.17bn vs consensus $14.74bn. Dividend of 11c took full-year dividends to 21.5c, up 23% on last year. Noted supply chain challenges, increased distribution centre labour and COVID-related costs are continuing and may remain a reality for all pillars (Food, Liquor and Hardware) over FY23. Signed a long-term lease with Goodman Group for ~115,000sqm distribution centre (DC) in Truganina, Victoria.
  • Evolution Mining (EVN)production levels are expected to be lower than previously forecast for FY23.
  • Southern Cross Media (SXL) understood to be retaining regional television unit.
  • Suncorp Group (SUN) hires Barrenjoey to consider sale/spin-off options for banking division.
  • Ramsay Health (RHC) – Speculation GIC is considering a stake in Ramsay Health Care operating company.
  • Ardent Leisure Group (ALG) – fresh speculation private equity is eyeing the business.
  • Link (LNK) – Dye & Durham expected to submit revised proposal for Link as soon as this week.
  • BWX (BWX) looking to raise $15-20m through Bell Potter.
  • Alliance Aviation Services (AQZ) has executed a contract for air charter services with Citic Pacific Mining Management (CPM) for an additional term of six years.
  • OZ Minerals (OZL)  has lowered its copper production guidance to reflect a soft start to the year.
  • RPM Global (RUL) has flagged that the total contract value of software license sales has reached $50.3m in FY 2022, which is up $3.2m on two weeks ago. Profit of $1.9m on sales up 33.9% to $40.5m for the six months to December 31

Economic News/Bond Markets

Asian Markets

  • Spot physical coal at Australia’s Newcastle port jumped 3.4% to a record $402.50 a ton on Friday, according to a biweekly index compiled by IHS Markit seen by Bloomberg.
  • Base metals rebounded from their worst week in a year as China’s economy showed signs of recovering. The LMEX index of six base metals fell 6.7% last week, its biggest weekly fall since the middle of June last year.

US and European Headlines

  • European markets expected to open around 0.5% to 1% higher.
  • G7 Leaders meeting in Germany continue. Who is in the G7%?
  • G7 aims to hurt Russia with price cap on oil exports.
  • Russia defaults on foreign debt for the first time since 1918.
  • Looks like Boris is intent on running Great Britain into the 1970s
  • Trip.com is set to report its first-quarter financial results on Monday in the US after the market close.
  • Vienna is now the world’s most liveable city deposing Auckland. Cities in New Zealand and Australia were the biggest fallers in the EIU’s liveability ranking. Melbourne came in at #10 tied with Osaka.

And finally…..

Clarence.

XXXX