ASX 200 kicks 82 points to 6666 (1.2%) as bank rally after Citi results and iron ore steadies in Asia, giving BHP a 2.4% lift. Late kick helps too, with 25 points on match out. The Miners were better across the board with RIO up 2.1% and FMG up 3.4%. Base metals doing well, S32 up 2.1% and IGO up 4.4% and lithium stocks doing well, LTR up 8.4%, INR better by 5.8% and PLS rallying 2.5%. Oil and gas better again as crude rises after Biden fails to get much from MBS. STO up 2.4% and WDS up another 2.2%. Coal stocks again pushed up as thermal coal doing well, WHC released a business update, very positive up 5.2% and NHC up 2.9%. Banks were in demand despite ANZ tapping shareholders for $3.5bn to buy SUN’s banking business kicking them up a notch. ANZ is paying $5bn for the unit, the Big Bank Basket rallied to $166.24 (1.8%) with only three legs firing. CBA up 1.0% and NAB up 1.9%. MQG doing well as US banks rally, up 3.2%. SUN up 6.1% on the ANZ news, insurers slightly better. Healthcare was weaker as money flowed into growth and risk, CSL down 0.9%, FPH down 1.9%. Industrials were mostly flat, tech better WTC kicked again up 7.2% and XRO up 2.0%. The All-Tech Index rose 2.5%. Incorporate news, NXL fell 13.0% on its update sinking toward an ignominious end perhaps, PPS rose 10.6% on a business update and TYR rose 7.7% as its #122 CV19 update dropped. Nothing on the economic front. Asian markets firmed with Japan closed for Marine Day and both China and HK doing well as property developers being helped with bank loans. 10-year yields 3.42%.

Headlines

  • Winners: BRN, PDL, LTR, 360, SWM, NVX, SYA, WTC
  • Losers: LFS, RPL, SHV, RED, PFP, EMR, APX, KLS
  • Positive sectors: Banks. Miners. Oil and gas. Coal. Lithium. Tech.
  • Negative sectors: Healthcare. Staples.
  • High 6687 Low 6613 Thin and narrow.
  • Big Bank Basket: Surges to $166.24 (+1.8%)
  • All-Tech index: Up 2.5%
  • Gold: Lower at $2523
  • Bitcoin: Holding steady at US$21429
  • Aussie Dollar: Better at 67.94.
  • 10-Year Yield:  Flat at 3.43%
  • Asian markets: Japan closed for Marine day. China up 1.4% and HK up 2.4%
  • US Futures: Dow up 120 Nasdaq up 86
  • European markets opening firmer by around 0.7% Haleon begins trade on LSE.

Major Movers

  • BRN +13.87% big volume rally.
  • LTR +8.42% lithium back in favour.
  • TER +6.29% thermal coal prices.
  • JIN +5.77% bounces back.
  • SUN +6.13% sells banking business to ANZ.
  • CXO +6.15% lithium back.
  • RHY +13.85% no blues here as recent trials positive.
  • TYR +7.69% CV19 Trading update #122.
  • PPS +10.57% quarterly update
  • EOS +9.82% some short covering.
  • ASN +4.55% additional high lithium results in drilling at Paradox.
  • NXL -13.01% results update.
  • CCR -9.20% turns down.
  • PTX -8.11% profit taking.
  • RPL -6.08% thin volume falls.
  • PPH -0.85% wing and a prayer.
  • Speculative Stock of the Day:  Lode Resources (LDR) +33.33% Most significant drill intercepts to date at Webbs Consol. Modest volume. Hole WCS023 at the Castlereagh prospect has intersected 50.0m grading 284 g/t silver equivalent from 17m.

In the News

  • ANZ Bank (ANZ) will acquire Suncorp Bank from Suncorp Group (SUN) for a purchase price of $4.9bn. The acquisition is expected to be completed in the back half of 2023 and is subject to conditions including Fed Treasurer and ACCC approval. The bank has withdrawn from discussions with KKR about the potential acquisition of MYOB. ANZ will keep the Suncorp Bank brand for now, saying it offers some potential benefits.1 for 15 pro rata entitlement issue to raise $3.5bn
  • ANZ Bank (ANZ) provide a Q3 trading update. Net interest margin (NIM) rose 3bps to 1.63% through the quarter, up from 1.58% this time last year, and expect further rate rises will be supportive for margins in Q4. Home lending volumes rose by $2bn for the quarter, taking the annualised growth rate up to 3%. The bank however did warn of “intense” price competition in the home lending portfolios in Australia and New Zealand.
  • Lynas Rare Earths (LYC) reported $294.5m in Q4 sales revenue, the second-best quarter the company’s history, though down from the $327.7m reported in Q3. The company’s cash balance rose to $965.6m, providing “a confident basis for funding continued growth as demand grows” according to CEO Amanda Margaret Lacaze.
  • Nuix (NXL)has warned they expect FY EBITDA to drop more than 50% to sit in the range of $10-12m (compared to $30.5m last year) due to legal costs and a drop in sales.
  • Premium (PPS) report Q4 Funds Under Administration (FUA) of $40.48bn, down from $42.12bn a quarter ago, with net quarterly inflows of $306m (offset by $1.5bn in negative market movements.
  • Woolworths (WOW) has snapped up retail digital media company Shopper Media Group for $150m. Shopper Media is a digital, out-of-home, media company that offers targeted shopper advertising through a national screen network of more than 2000 screens in more than 400 shopping centres.
  • Whitehaven (WHC) says it expects to report full-year EBITDA of $3bn, versus $200m in 2021. It finished the financial year with no debt and net cash of $1bn
  • Ladbrokes and Neds gambling brands has launched a group of online television channels in Australia in a bid to boost engagement with punters.

Economic News/Bond Markets

  • New Zealand’s annual inflation reached 7.3% for the June quarter slightly ahead of analysts’ expectations and at its highest in 32 years. The increase follows a 6.9% rise in the March 2022 quarter which was the previous largest annual movement since a 7.6% increase in the June 1990 quarte
  • Westpac chief economist Bill Evans estimated the Reserve Bank of Australia’s balance sheet has suffered $37bn in losses from its bond purchasing. The Reserve Bank has pledged a review of its pandemic response.
  • ANZ CEO Shayne Elliott acknowledges the difficult economic times facing the bank’s customers in Australia. Elliott says on a conference call that “households continue to be very well-placed”.
  • The World Bank says food prices are forecast to rise 20% this year.

Asian Markets

  • Shanghai Covid cases above 500.
  • CATL is looking at building a battery factory in Mexico. The battery manufacturer is considering Ciudad Juarez, in the state of Chihuahua, and Saltillo, in Coahuila.
  • China’s bank and property stocks rose after regulators sought to defuse a growing consumer boycott of mortgage payments by urging banks to increase lending to developers.

US and European Headlines

  • European markets set for a slightly positive opening by around 0.7%.
  • HALEON lists on the London Stock Exchange today. A spin off from GSK. Biggest listing in a decade. GBP 45bn enterprise value.
  • Heatwave and forest fires hit Europe.
  • President Biden has returned from his tour of the Middle East. Not much to show for it except a fist pump. Nothing on energy.
  • G20 finance ministers fails to agree on much at all.
  • Nord Stream set to reopen on Thursday. Or not.
  • Zelenskyy fires security chiefs over ‘treasonous’ officials.
  • Starbucks examines sale of its UK business.
  • In Ibizia, a seaside restaurant charges EUR30 ($20) for a burger. A large sunbed at an upscale beach club can cost EUR500 in August.
  • Global interest rates will likely keep rising until 2023 when heated prices will begin to cool in response to the actions from central banks according to the IMF.

And finally….

My wife will go spare when she finds out I’ve lost her copy of Schubert’s Unfinished Symphony. I’ll never hear the end of it.

I went on a once in a lifetime holiday.

Never again.

Clarence

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