ASX 200 dropped 53 points to close at 7302 (0.7%). Up 55 points for the week. Some caution creeping in before the US jobs data tonight and it has run hard. The Big Bank Basket fell to $186.74 (1.1%). MQG slid 1.0% and insurers also in the doghouse as bond yields continue to fall. 10-year yields now back to 3.39%. QBE down 0.2%, MPL off 1.7% and money managers down too, GQG off 3.0% with MFG falling another 1.9%. Industrials relatively firm, TLS up 0.5%, REA up 0.7% and CPU up 0.1% with healthcare also doing ok as RMD rose 1.6% and CSL up 1.1%. REITs stumbled lower despite rates easing, GMG down 4.1%, GPT off 2.2% and SCG falling 2.7%. Tech better with the All–Tech Index up 0.6% as WTC rallied 0.5% and BTH got an 80c bid. In resources, iron ore stocks eased, BHP down 1.4% energy down too WDS copping some broker negativity falling 2.6% and coal stocks not such a merry old place to be. Gold miners though enjoying a day in the sun, SBM up 10.4%, NCM up 2.1% and GOR flying another 2.2%. Base metals too in the green, IGO up %, PLS up % and CHN up 3.7% in speculation Twiggy is interested. In corporate news, WGO got another revised bid from BPT at 25c. STO had a court case go against them on Barossa gas project falling 3.8%, PMV posted record Black Friday sales, it still fell 0.5%. CRN warned on wet weather impacts, DMP completes its placement of $150m to buy out its German partner. In economic news, the total new loan commitments for housing fell 2.7% in October. Japan down 1.6%, China off 0.3% and HK down 0.7%. 10-year yields at 3.39%

HEADLINES

• Winners: RED, SBM, HPI, CMM, A4N, SLR, ABB, STX
• Losers: CTD, PPC, IPH, CHC, ACL, SNL, TER, CRN
• Positive sectors: Healthcare, Industrials, Tech, Base metals, Gold miners
• Negative sectors: Oil and gas, Coal, Iron ore, REITs
• High 7349 Low 7293 Up 55 points for the week (0.76%)
• Big Bank Basket: Closed down at $186.74 (1.1%)
• All-Tech index: Up 0.7%
• Gold rallies hard to $2637
• Bitcoin: Falls to US$16906
• Aussie Dollar: Steady at 68.15c
• 10-Year Yield: Falls to 3.39%
• Asian markets: Japan down 1.6%, China off 0.3% and HK down 0.7%
• US Futures: Dow down 49 Nasdaq down 37 Jobs report in focus.
• European markets – Oil price cap in focus.

MAJOR MOVERS

• SBM +10.40% gold price rally.
• SIQ +6.46% media speculation on PE interest.
• CMM +8.09% change of director’s interest
• RED +11.11% seeing green. KOTH.
• DUB +27.78% Vodafone UK deal.
• WR1 +13.64% acquisition of lithium project in Canada.
• BTH +11.03% cash bid at 80c.
• PAN +11.11% nickel picking up.
• WGX +12.58% becoming a substantial holder.
• WGO +8.65% counter proposal from BPT.
• LIN -16.33% placement to raise $16m
• IVZ -7.04% slipping lower again.
• CTD -5.85% sliding away.
• TCL -0.98% reaffirms guidance.
• ABC -3.63% Kwinana upgrade project update.
• SMR -3.99% TER -4.42% coal prices.
• Speculative Stock of the Day: American Rare Earths (ARR) +20.00% outstanding mineralogy test results. Host mineral Allanite contains approximately 90% of total rare earths present

IN THE NEWS

• Chalice (CHN) – stories circulating that Andrew Forrest has bid for an 8.8% stake in the company taking out retiring chair Tim Goyder.
• Smartgroup (SIQ) – The AFR has reported that private equity groups are taking another look at Smartgroup. This follows interest from TPG Capital over a year ago, which included an offer of 1035c. The group is up around 10% on the news, which could be a catalyst for a return to previous levels, having fallen around 47% since April.
• Coronado (CRN) – Annlounced that it will not meet the production volumes that were provided in FY22 guidance due to ongoing wet weather conditions. The mining sector in particular has been hit particularly hard by the weather conditions, with CRN saying costs have been pushed higher but have reaffirmed total Capex despite the decreased production.
• Transurban (TCL) – Has reaffirmed FY23 Guidance and will pay out an unfranked dividend of 26.5c.
• Telstra Group Limited – (TLS) delays the launch of its retail energy business until middle of 2023 when the final decision on the rollout is due citing it didn’t make sense to scale up with the dislocation between wholesale and retail prices crunching margins. The project is a key part of Telstras T25 plan to return to growth.
• Warrego Energy Limited – (WGO) Beach Energy (BPT) submitted a counterproposal to acquire all issued shares in Warrego for 25c cash, plus any net proceeds received for the sale of Warrego’s Spanish assets. Warrego’s Share price is up 8.5% following the bid.
• Adbri Limited (ABC) – Adbri Limited provides an update regarding its Kwinana upgrade project. To date ~94m has been invested in the project with further capital spend likely to be in the range of $170m to $200m. Adbri is reviewing options for the project to optimise value including cost mitigation as well as alternatives to further improve synergies with existing operations and logistic networks. The full review of the project to be completed early 2023.
• Atlas Arteria (ALX) – Atlas Arteria has announced it has completed the acquisition of a 66.7% majority interest in Skyway Concession Company the concessionaire of the Chicago Skyway. Ontario Teachers Pension plan will continue to hold its 33.33% in Chicago Skyway.
• ASIC has fined the Australian arm of $10.5 trillion investment giant Vanguard for overstating the extent of an exclusion of tobacco-related companies from one of its suites of managed funds.
• Santos (STO) – the appeal against a Federal Court judgment that forced it to cease drilling at the Barossa gas project has been dismissed. In the original ruling in September, Federal Court Justice Mordy Bromberg found the oil and gas producer failed to consult adequately with local Indigenous people on the development.
• EnergyAustralia and AGL Energy (AGL) will increase gas bills for some of their Victorian customers by more than 20%.
• Premier Investments (PMV) – reported a 25% jump in global sales in the first 17 weeks of its fiscal year, compared to pre-COVID-19 levels in 2020.

ECONOMIC NEWS

• Westpac has forecast GDP, to be released next Wednesday, to grow 0.8% in the September quarter, lifting annual growth to 6.4%. The level of activity will be 6.4% above that at the end of 2019, before the pandemic.
• The value of total new loan commitments for housing fell 2.7% in October 2022 (seasonally adjusted), while the value of owner-occupier refinancing between lenders fell 1.3%.

• HSBC says a tight jobs market and inflation that is too high mean the RBA will lift the cash rate by a further 0.25% then a pause perhaps awaiting the lagged impact.

ASIAN MARKETS

• South Korea’s annualised inflation for November came in at 5%, lower than estimates of 5.1% surveyed in a Reuters poll.

US AND EUROPEAN HEADLINES

• OPEC Plus meets this weekend.
• Global inflation is showing signs of having peaked according to Bloomberg. Bloomberg Economics estimates worldwide inflation topped out at 9.8% year-on-year in the third quarter and is now headed to 9.5% in the final three months of the year and 5.3% at the end of 2023.

• Biden says he is prepared to speak to Putin about ending the war.
• Blackstone limits withdrawals at US$125bn property fund as investors rush to exit.
• US warns Beijing it cannot control Covid-19 without western vaccines.
• Elon Musk launches his new semi truck.
• Bitcoin could crash to $10,000, a more than 40% plunge from current prices, veteran investor Mark Mobius told CNBC.
• Russian oil sanctions are about to kick in. The 27 countries of the European Union agreed in June to ban the purchase of Russian crude oil from Dec. 5. Still arguing about the details.
• Germany is out of the World Cup. Again.

And finally…

Clarence

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