ASX 200 closed down 3 points to 7362 in a mixed day of trading as BOQ, RIO and ZIP all came out with earnings reports. Resources getting whacked today on the back of RIO activities report, down 2.3% and demand concerns from China. BHP down 2.6% and FMG down 0.9% Lithium down as well, with prices continuing to slip as lithium supply cycles through in China. LTR down 0.4%, MIN down 5.5% and PLS down 4.9%. Gold stocks lower as bullion price drops to $2979, NST down 4.2%, and NCM down 0.5%. Energy stocks are down for a third consecutive day as Oil dropped overnight, WDS down 0.5% and STO off 0.4%. Banks gaining today after BOQ released a positive report, Big Bank Basket up 1.4% to $177.05, BOQ up 1.1%, WBC up 1.5%, and ANZ up 1.3%. Technology mostly unchanged, the All–Tech Index fell 0.4%. With WTC down 0.5% and SQ2 down 1.14% REITs gained. Consumer discretionary bouncing back from yesterday’s losses, up 1%. On the corporate front it was a busy day, RIO released quarterly activities report with record export shipments, also warned of lithium delays. The ACCC blocked QAN acquisition of AQZ citing a lack of competition in the airline industry. BOQ released an earnings report with positive results released, including $4m in statutory net profit. In economic news, Japan’s exports increased higher than expected. New Zealand inflation decreased more than forecasted. Asian markets down, Japan flat, HK down 0.1%, and China off 0.4%. 10-year yields up to 3.51%. Dow Jones futures down 28 points and Nasdaq futures down 74 points.

HEADLINES

• Winners: GMD, CDA, VUK, GEM, SDR, TLX, VSL, MAF
• Losers: 29M, WBT, CMM, AQZ, RED, AGY, MIN, AKE, GRR
• Positive sectors: Banks. Industrials. REITs.
• Negative sectors: Iron ore. Lithium. Base metals. Oil and gas.
• High 7377 Low 7347
• Big Bank Basket Rallies hard to $177.05 (1,4%)
• All-Tech index: Down 0.4%
• Gold steady at $2970
• Bitcoin: Falls to US$28948
• Aussie Dollar: Steady at 67.04c
• 10-Year Yield: stronger at 3.51%.
• Asian markets: Japan flat, China down 0.4% with HK down 0.1%
• US Futures: Dow down 28 Nasdaq down 74
• European markets set to open slightly lower. Results focus.

MAJOR MOVERS

• GMD +7.03% flying high on SBM deal.
• TLX +4.48% kicks again post update.
• LOV +3.65% it’s the little things.
• MAF +4.23% buys marinas.
• CTT +3.15% luxury is still doing well.
• SLA +23.97% WES bid at 315c.
• JRV +10.00% Nico project update.
• AMI +14.29% quarterly update.
• MEI +7.69% positive outcome on U & Th levels at Caldeira.
• G1A -34.78% reinstatement to quotation.
• EML -9.20% some give back after run up.
• 29M -11.11% rain stops play.
• WBT -9.82% profit taking.
• AQZ -7.12% ACCC says no. Kane misses sitter.
• AGY -5.68% lithium stocks under pressure.
• PLS -4.89% profit taking after a few days of gains.
• ESS -2.91% MIN votes to not accept Tianqi takeover. Scheme was not approved.
• GRR -5.19% iron ore turns negative.
• Speculative Stock of the Day:Moho (MOH) +50.00% Good volume too. Significant clay-hosted rare earths intersected at Peak Charles.

COMPANY NEWS

• Rio Tinto (RIO) – Australian iron ore division achieved a record 16% increase in export volumes, shipping 82.54m tonnes in Q1 2023, beating previous records and exceeding analysts’ expectations. Rio Tinto has set a guidance range of 320m to 335m tonnes of iron ore exports from WA in 2023.
• Origin Energy (ORG) – Announced a $600m commitment for the first-stage development of a large-scale battery at its Eraring power station, with construction set to commence within weeks. The battery will have a capacity of 460 megawatts with a dispatch duration of two hours.
• Zip Co (ZIP) – Revenue for Q1 2023 up 15% to $182.1m, with bad debt expenses falling to 1.2% of total transaction volume in the US, compared to 3.7% in the same quarter last year. However, despite the positive financial performance, ZIP’s shares have declined by 57% over the past year.
• Brambles Ltd (BXB) – Upgraded its full-year profit forecasts after a strong March quarter, with underlying profit growth now expected to be between 17% and 19% for 2022-23, up from the previous range of 15% to 18%.
• Iress Ltd (IRE) – Announced plans to cut around 10% of its workforce as part of a cost reduction strategy, aiming to save approximately $32m per year. The company also reported a write-down of $123m in the value of its operations, mainly in the UK, but reaffirmed its guidance for 2023 segment profit to increase by 10%.
• Redbubble (RBL) – Reported improved gross margins in Q1, with a 7.7% increase compared to PCP, attributed to price adjustments and promotional activity. Online marketplace also noted an 8% decline in marketplace revenue compared to the same period last year, and forecasted slightly lower revenue for 2023 with gross margins expected to be between 18% and 20%.
• Santos (STO) – Lowered production by 15% to 22.2m barrels of oil in Q1, citing reduced domestic gas volumes and extended production from Bayu-Undan field. Sales revenue also decreased by 14%.
• Alliance Aviation (AQZ) – The ACCC has announced that it will block Qantas (QAN) proposed acquisition of AQZ, citing concerns about reduced competition in the markets for air transport services to resource industry customers in Western Australia and Queensland.

ECONOMICS & OTHER NEWS

RBA 51-point plan to overhaul the central bank. The treasurer also announced two new external RBA board members, Iain Ross and Elana Rubin.

• The RBA should set up an expert policy board, hold fewer meetings and give press conferences explaining its decisions.
• The report recommended the six external members have diverse economic backgrounds and have direct access to RBA staff. They will work part-time, equivalent to about one day a week.

The review also recommended:

• The treasury secretary remains on the policy-setting board
• Five-yearly reviews of the monetary policy framework and tools
• The RBA’s post-meeting statement contain unattributable votes
• An updated Statement on the Conduct of Monetary Policy be agreed by the RBA board and government by the end of 2023
• Press conferences after each policy meeting

ASIAN MARKETS

• TSMC profit beat expectations after its chip margins held up better than anticipated.
• India has overtaken China as the world’s most populous nation, according to United Nations. India’s population surpassed 1.4286bn, slightly higher than China’s 1.4257bn people.
• The most expensive tickets worth about S$11,000 to this year’s Singapore Formula One Grand Prix race have all been snapped up.
• Singapore bondholders prepare to sue Switzerland over Credit Suisse.

US AND EUROPEAN HEADLINES

• European markets are heading for a flat to lower open Thursday. Earnings are set to come from WHSmith, Rio Tinto, Dunelm, Renault, Publicis and Ferragamo. Data releases include preliminary consumer confidence figures for the euro zone in April.
• Renault worldwide sales up 14.1%.
• Google to deploy generative AI to create sophisticated ad campaigns.
• Elon Musk will continue to cut prices to stoke demand for its electric vehicles, even at the expense of its industry-leading profit margins. The base price of the Model 3 has now dipped below $40,000 in the US for the first time in years, a roughly $7,000 cut from the start of the year. Tesla’s operating margin was 11.4% in the first quarter, down from 16% the previous period and 19.2% a year ago.
• Of the 53 companies in the S&P 500 reporting so far, 83% have beat Wall Street’s expectations by 6%. Both of those rates are above average.
• Inflation pushes UK car insurance prices to highest level in 12 years.

And finally…

I have two unwritten rules:

Clarence

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