ASX 200 closed down 21 to 7360 (-0.3%) in a dull day of trade, as the market digested RBA meeting minutes which warned more rate hikes may be needed. Energy sector pummelled, as Treasurer Chalmers is anticipated to hike taxes on big gas producers, STX down 7.1%, STO down 1.9%, and WDS slipping 2.4%. Gold miners failed to impress, AGG and NST down 2.9% and 0.1%. Utilities sector stronger, APA up 1.6%. Banks mostly lower, ANZ flat, and CBA down 0.3%. The Big Bank Basket dropped to $174.64 (-0.1%). REITS mixed. Tech fell with the All-Tech Index down 0.4%. XRO down 1.3%. ALU down 0.9%. Healthcare not healthy, CSL down 0.5%, RMD off 0.7%, COH slipped 0.5%. Industrials flat, A2M and ELD higher but WOW fell 1.9%, COL down 1.2% and REA off 0.8%. In corporate news, TLX surges 12.7% after posting net operating cashflow of $2.5m, EVN resumes mining at Ernest Henry operation, HUB, PPS, and RPL all reported FUM/FUA. In economic news, ANZ-Roy Morgan consumer confidence fell marking the seventh straight week below 80 as consumers turn pessimistic after a series of interest rate rises, China’s GDP rose 4.5% beating expectations in the first quarter after Xi lifted COVID-19 restrictions triggering a rebound in factory and consumer activity. Asian markets mixed, Japan up 0.7% and HK down 0.7% with China up 0.2%. Dow Jones futures up 11 points and Nasdaq futures down 6 points.

HEADLINES

• Winners: TLX, WBT, LLL, INR, CXO, RED, NEU
• Losers: SYA, LKE, STX, TIE, 29M, NVX, CTT
• Positive sectors: Lithium.
• Negative sectors: Oil and Gas. Staples. REITs. Gold miners.
• High 7380 Low 7342
• Big Bank Basket Unchanged at $174.64
• All-Tech index: Down 0.4%
• Gold slips to $2972
• Bitcoin: Falls to US$29,460
• Aussie Dollar: Steady at 67.10c
• 10-Year Yield: stronger at 3.48%.
• Asian markets: Japan up 0.7% and HK down 0.7% with China up 0.2%
• US Futures: Dow up 11 Nasdaq down 6.
• European markets set to open slightly higher again. UK jobs data 3.8% unemployed.

MAJOR MOVERS

• TLX +12.67% positive reaction to business update.
• CXO +6.49% resource upgrade at Finniss.
• LLL +7.69% Macquarie pushing it hard.
• INR +6.67% lithium bounce.
• NEU +5.58% hits highs on milestone payment on US launch.
• PLS +4.21% stirring UBS upgrades.
• RED +5.88% second tranche placement.
• AGY +5.06% lithium buyers emerge.
• AKE +3.97% quarterly report.
• GMD +4.13% brokers warm to deal.
• LKE -9.17% broker downgrade.
• STX -7.07% gives back some recent gains.
• 29M -4.83% gives back some of yesterday’s rise.
• NVX-4.67% sinking again.
• Speculative Stock of the Day:Larvotto Resources (LRV) +77.78% Bonanza rare earth drill results at Merivale South. Hemmes gets everywhere.

COMPANY NEWS

• Neuren Pharmaceuticals (NEU) – Announced that its partner Acadia Pharmaceuticals has launched DAYBUE (trofinetide) in the United States for the treatment of Rett syndrome, following FDA approval. Neuren is set to receive US$40m for the first commercial sale of trofinetide and ongoing royalties on net sales.
• Praemium Ltd (PPS) – Reported an 8% increase in total funds under administration to $43.7bn, with net inflows of $1239m for the financial year to date.
• Telix Pharmaceuticals (TLX) – Reported positive cash flow of $2.5m and sales of $83.2m for Q1, with total US sales up 27% from the previous quarter, and plans to expand in Europe and Asia-Pacific. Shares have risen 67% in the past year.
• IPH Ltd (IPH) – Noted an earnings hit after a cyberattack resulted in a budget shortfall of $4.4m for its affected groups. The company also expects remediation costs of $2m to $2.5m and has notified a small number of individuals affected by the cyberattack.
• Hub24 Ltd (HUB) – Reported net inflows of $1.9bn for the March quarter, bringing total funds under administration to $76.9bn. Platform funds increased by 16.5% compared to the prior corresponding quarter, reaching $59.4bn, while portfolio, administration, and reporting services rose by 1% to $17.5bn.
• Core Lithium (CXO) – Increases resources at Finniss project by 62% to 30.6m tonnes. Results come following further drilling at the project completed in 2022.
• Evolution Mining (EVN) – Mining activities at the Ernest Henry operation have safely resumed and are expected to ramp up to normal production levels by the end of June quarter 2023, within the previously announced six-week timeframe. Weather impacts are expected to result in lower gold and copper production for FY2023, with reduced production levels in the March quarter as well.

ECONOMICS & OTHER NEWS

RBA MINUTES

• In Australia, inflation remains high, but the tighter monetary policy is gradually flowing through to the real economy.
• Timely indicators suggest solid wage growth.
• Government bond yields had declined, and their volatility increased significantly.
• The Australian dollar remained stable on a trade-weighted basis, and foreign exchange markets had remained relatively stable.
• Banks and other Australian deposit-taking institutions were well placed to repay loans from the Term Funding Facility.
• Mortgage payments for households reached historic highs and are projected to reach around 10% by late 2024.
• Members of the Australian monetary policy committee noted that inflation was still too high, unemployment rates were very low, but there had been a material slowing in consumer spending growth.
• Members discussed the case for a further 25 basis point increase in the cash rate target but agreed on a stronger case to pause and reassess the need for further tightening at future meetings.

• ANZ-Roy Morgan Consumer Confidence data has marked a seventh straight week below 80 as consumers turn pessimistic after a slew of interest rate increases.It registered 77.2, erasing the increase of 1.1 points last week after the RBA decided not to raise interest rates in April. Consumer confidence is now 19.6 points below the same week a year ago, the data provider said.

• Mortgage arrears rose by 23% YoY in the New Zealand housing market, reaching the highest level since March 2020, indicating challenges in servicing higher mortgage rates. Falling house prices and rising interest rates are impacting consumer confidence and household spending, with the central bank expected to raise its official cash rate to 5% on Wednesday, the highest in 14 years.

ASIAN MARKETS

• China’s economy rose 4.5% in the first quarter.
• Retail sales in the first quarter rose 5.8% year-on-year compared to a fall of 2.7% in the fourth quarter.
• Fixed asset investment rose 5.1%.
• The value of China’s exports in the first quarter rose 8.4%.
• March factory output gains 3.9%, versus 4.4% prediction.

• Chinese Steel production rises ahead of busy period for construction.
• Oil processing rose 8.8% to 63.3m tons, an all-time high for a single month’s data.
• Shanghai auto show, runs through April 27.
• Chinese sportswear group Anta raises $1.5bn in Hong Kong placement.

US AND EUROPEAN HEADLINES

• Apple launches a new high interest account with a 4.15% yield. 10 times higher than the current average. Average savings account in US is 0.37%. And it is insured by FDIC.
• UK jobs 3.8% unemployment. Feb average weekly earnings up 6.6% Y/Y
• Goldman Sucks reports tonight. Here is what to expect. Revenue of $12.79bn, 1.1% lower than a year earlier. Earnings: US$8.10 per share, 25% lower than last year.
• Bank of America and Netflix due tonight too.
• BlackRock strategists are ditching the 60/40 portfolio in favour of public and private investments as well as tactical holdings of bonds to navigate higher interest rates. A Bloomberg US 60/40 portfolio index is up 6.3% this year after tumbling almost 17% in 2022 in its biggest annual drop in over a decade.
• Christine Lagarde says US-China rift to push inflation higher.
• A new US survey finds 27% of people aged 59 and older have no money set aside for their later years. More than 30% of respondents said their net worth is $0 or less, meaning they have more debts than assets. 41% of Gen Z and 38% of millennials saying they have zero or negative net worth. For people aged 59 and over, that number was 21%.
• Elon Musk’s SpaceX calls off first attempt at Starship launch.

And finally….

Desmond Dekker went to get his hearing checked. Turned out the ears are alright.

I applied for a job in a chemical company. The interviewer asked me what I knew about nitrates. I said “I’m hoping it’s time and a half”

Clarence

XXX