ASX 200 finished the week down 59 points to 6786 (-0.9%) as resources fell hard on iron ore falls. For the week the index rose 1.6% with Banks better again as the Big Bank Basket rose to $184.42 (0.7%). ANZ recovered from early losses to close up 0.9% on broker commentary. MQG down slightly giving back early gains, Insurers mixed, QBE down 0.4% and MPL down 2.8%.  Healthcare took flight with RMD leading the sector down falling 5.0% on quarterly results. CSL dropped 0.6% and CUV lower by 5.2%. Industrials were mixed, some buying of defensives, TLSDA up 0.3% and TCL doing well up 2.2% as bond yields dropped to 3.76%. RBA beckons next week. REITs mixed, GMG off 1.1% with SCG up 4.0%. Tech stocks were down but not out with the All-Tech index down 1.5%. XRO continued to slide down another 2.8% with our own ‘Amazon Lite’ KGN falling 3.0%. Resources were hurt today as iron ore stocks fell hard, BHP down 5.0% (30 index points alone), FMG savaged 8.2% after production and broker rethink. Lithium stocks too in distress, PLS off 4.7% and CXO down 2.9%. Gold miners held up relatively well, MIN dropping 6.4% and IGO in base metals not flash. Oil and gas stocks held up but coal not such a merry old soul. NHC down 9.7% and WHC off 4.2%. In corporate news, CXL lost its grants, falling 19.0%, MCR got smashed 14.8% on a quarterly report. AQZ fell 3.90% as ACCC pushed out its decision yet again to March 2023. Nothing significant on the economic front as we line up for the RBA decision on Tuesday. Asian markets ease as Japan falls 0.6% as BoJ leaves rates unchanged, HK down 2.2% and China down 1%. Dow futures are down 20 points.

HEADLINES

• Winners: 5EA, QUB, VCX, RMS, SKC, SCG, LLC, EBO
• Losers: BRN, CXL, GRR, MCR, IMU, NHC, SYA, CIA
• Positive sectors: Banks. REITs. Defensives.
• Negative sectors: Iron ore. Healthcare. Tech. Coal. Lithium.
• High 6827 Low 6776 ASX 200 up 1.6% for the week.
• Big Bank Basket: Closed up to $183.08(0.1%)
• All-Tech index: Falls 1.5% could have been worse.
• Gold: Rises to $2573
• Bitcoin: Higher at US$20,274
• Aussie Dollar: Lower at 64.68c
• 10-Year Yield: Lower at 3.75%
• Asian markets: Japan down 0.1%, HK down 2.2% and China down 1.0%
• US Futures: Dow down 20 Nasdaq down 104 – US PE Inflation gauge tonight. 5.2% Y/Y expected.
• European markets: UK FTSE futures down 39 points, German DAX down 87 points

MAJOR MOVERS

• 5EA +8.89% bounces back.
• INR +0.93% end of week book squaring.
• RMS +4.23% broker upgrades on quarterly.
• DMP +2.73% shorts cover a little.
• LRS +9.52% having a good day.
• A11 +5.79% appoints new COO.
• FBR +10.42% annual report.
• NHC -9.67% coal stocks in a hole.
• SLR -8.23% quarterly report.
• CXL -18.98% loses government grants.
• BRN -21.18% no brainer.
• GRR -17.12% iron ore falls.
• MCR -14.83% quarterly woes.
• CIA -9.16% iron ore falls.
• CTT -8.52% tech stocks fall.
• BET -13.11% investor update.
• MAY -9.84% depth reached on Zapato.
• M7T -12.10% quarterly report.
• Speculative Stock of the Day: Winsome Resources (WR1) +28.77% clarification on drilling update. Good volume too. Significant intercept at Adina.

IN THE NEWS

• Macquarie Group (MQG) – First-half net profit of $2.305bn, ahead of consensus of $2.16bn. The group announced an interim dividend of $3.00/share, with 40% franking. Profits were up 13% on last year but down 13% on the second half of FY22. Assets under management increased 3% to $795.6bn over the first half of the year. International income accounted for 72% of the total income, with 38% from the Americas, 24% from EMEA, and 10% from Asia. Profits from market-facing activities were down 18% to $2.292bn over the half, with profits from annuity-style activities down 15%, to $2.281bn over the half.
• ResMed Inc (RMD) – Has announced a 5% revenue to $950.3m in their First quarter report for FY23. “Strong sales growth in the Americas and solid performance overall” – CEO. RMD also reported a 5% growth in operating profit in the same period, with a boost in gross margin of 90 bps to 56.9%. The market reacted poorly to the news as RMD opens 5% lower, as European, Asian and other markets’ revenue was down 16% and lower than expected forecasts. Investors clearly expected more following the Philips Ventilator debacle.
• Judo Capital Holdings (JDO) – Released in today’s AGM, profit before tax was greater than $23m for 1Q23 compared to FY22 of only $15.6m. The company reiterates that they are on track for FY23 guidance and confirms that the net interest margin is expected to be between 3.3% to 3.5%.
• Downer (DOW) – Has announced that they have been awarded a $490m road maintenance contract in Victoria by the department of transport. The contract is due to begin in February 2023 for a maximum term of seven and a half years.
• BetMakers (BET) – Announced a 13% increase in cash receipts to $23.8m in their quarterly report. With $2bn in turnover across the platform clients and 100 thousand downloads for the quarter.
• Kelsian Group (KLS) – Has announced they have expanded their education transport sector through the proposed acquisition of Horizons West Bus and Coachlines. Horizons is to be purchased for $23.4m, as well as strategic property for $16.7m.

ECONOMIC NEWS/ BOND MARKETS

Key statistics

• The Australian economy grew 3.6% in chain volume terms in 2021-22
• Labour productivity rose 1.1%
• The household saving ratio fell to 13.0%
• National net worth rose $2.3 trillion to $17.6 trillion

ASIAN MARKETS

• The Bank of Japan maintained its loose monetary policy as expected. It also said it would purchase necessary amounts of Japanese government bonds at a fixed rate in order to keep 10-year JGB yields at around 0%. Why doesn’t Japan have an inflation problem?

• Singapore home prices rose more than initially estimated in the third quarter, underscoring the market’s resilience to rising interest rates.

• Japanese PM Kishida ordered an extra budget of 29.1 trillion yen (US$199bn) to fund an economic stimulus package aimed at easing the impact of rising prices on consumers.

• Economists downgrade the Chinese GDP growth forecast for this year to 3.3%.

US AND EUROPEAN HEADLINES

• US PE Inflation gauge tonight.
• Elon Musk completed his $US44bn acquisition of Twitter. Loses Twitter executives as they walk out as he walks in with a sink. Departures include CEO Parag Agrawal; Vijaya Gadde, the head of legal, CFO Ned Segal. Tesla engineers to meet with Twitter product leaders soon.
• US$800bn wiped off big tech stocks this week.
• Musk promises Twitter won’t ‘become’ free-for-all hellscape. Good to know.
• Parts shortages dog US defence contractors as war depletes arsenals.
• Sunak explores tax rises and spending cuts of up to £50bn.
• Apple says it is facing ‘significant’ headwinds from strong US dollar.

And finally….

I told my wife she drew her eyebrows too high. She seemed surprised.

My grandfather has the heart of a lion and a lifetime ban at the zoo.

Clarence

XXXX