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ASX 200 finished up 65 points at 7443(0.9%) in another strong day but well off highs as some profit taking creeping in. Big caps in focus. The iron ore miners shooting the lights out, BHP close to all-time highs up 2.4%, RIO up 2.2% and FMG giving Twiggy a very happy Xmas up 1.4%. Lithium stocks saw short covering across the board as lithium carbonate prices rally in China. PLS up 3.4% and MIN up 2.1% with IGO rallying 6.1%. Gold miners not so hot despite bullion rallying, NEM up 2.2% and EVN up 0.3%. Oil and gas stocks rebounded WDS up 1.4% and STO better by 3.2%. Coal stocks also better, WHC up 0.8% and uranium at 15-year highs giving PDN a flip higher. Up 2.1%. Banks too in demand still, CBA up 0.5% and ANZ the star up 1.2%. The Big Bank Basket up to $188.28(+0.7%). Financials doing well, even ZIP up 17.8%. MQG continues its rally up 0.5% with insurers steadying. REITs a little mixed DXC down 3.6% on a revaluation of properties. GMG slipped 1.8%. Healthcare better with CSL up 0.7%. Industrials pausing a little, TCL in demand on yields falling, up 1.9%. Tech a little flat, the All-Tech Index up 0.4%. In corporate news, AMP down 1.6% after it has provided an update on its $1.1bn capital management program, revealing a return of $750m since Aug-22. ABC has shared news on the Kwinana Upgrade Project and provided a trading update, projecting the 2023 underlying EBITDA to fall within the $310 – $315m range. Stock up 8.6%. HLS fell 0.7% on an  announcement that ACL intends to withdraw its offer. No surprise there. In economic news, NAB chair says Australia will avoid a recession. PMIs out. In Asian markets, a positive reaction to more stimulus from the PBoC, Japan up 1.2% China up 0.7% and HK up 3.0%. 10-year yields back to 4.14%.

****Quadruple Witching in the US tonight. Around US$3.1 trillion of derivatives to expire. Last major liquidity event for 2023. Will add to the volatility. US markets experiencing serious jump in volumes****

HIGHLIGHTS

  • Winners: CXO, WBT, CHN, HMC, ABC, SYA, ZIP
  • Losers: APM, TLX, CMW, RED, SIG, CTT, MP1, FPH
  • Positive sectors: Banks. Iron ore. Oil and gas. Lithium. Gold.
  • Negative sectors: REITs modestly.
  • ASX 200 Hi 7462 Lo 7391 ASX 200 up 3.5% this week.
  • Big Bank Basket: Better at $188.28(+1.7%)
  • All-Tech Index: Up 0.4%
  • Gold: Steady at $3031
  • Bitcoin: Unchanged at US$42799
  • 10-year yields steady at 4.14%
  • AUD: Steady at 67.19c
  • Asian markets better, Japan up 1.2% China up 0.7% and HK up 3.0%.
  • US futures: Dow futures up 53 Nasdaq up 18

MAJOR MOVERS

  • CXO +15.1% lithium bounce back.
  • SYA +8.3% ditto.
  • ABC +8.6% Kwinana grade and trading update.
  • LNK +7.9% AustralianSuper MOU.
  • CHN +9.4% the brew that is true.
  • WBT +14.8% kicks again.
  • HMC +9.2% AFR article and SIG deal.
  • VUL +19.5% shorts cover.
  • PLL +12.4% lithium is back.
  • ZIP +17.8% Xmas comes early.
  • APX +9.1% recent substantial short holder notice.
  • APM -10.4% big volume too.
  • TLX -10.2% profit taking.
  • SIG -6.7% rethink on valuation.
  • MP1 -5.1% sinking slowly.
  • IVZ -22.0% disappointing drill results.
  • Speculative Stock of the Day: No real clear volume winners. BPH Energy (BPH) +22.5% having a good day but only $553k worth trade.

COMPANY NEWS

ECONOMIC AND OTHER HEADLINES

  • Australia’s Services PMI for Dec-23 improved to 47.6 from the previous month’s 46, marking the third consecutive month of contraction, albeit at a slower pace.
  • Australia’s Manufacturing PMI for Dec-23 slightly improves to 47.8, but the sector continues to contract for the tenth consecutive month, with output declining at a faster pace and new orders still contracting solidly.
  • Overseas migration 2022-23 – net annual gain of 518,000 people.
  • More than two in three (67.9%) adults had measured waist circumference that put them at an increased risk of disease in 2022.
  • Largest group of migrant arrivals was temporary visa holders with 554,000 people.
  • Almost two thirds (65.8%) of adults were overweight or obese.
  • China’s central bank injected the most cash via one-year policy loans since at least 2016, as it seeks to support an economy suffering from a housing slump and weak demand.
  • The People’s Bank of China offered commercial lenders 1.45 trillion yuan ($204 billion) via its medium-term lending facility.
  • The au Jibun Bank’s purchasing managers index of activity in Japan’s manufacturing sector dipped to 47.7 in December, the lowest since February and matching the level back in September 2020.
  • Oil was poised to eke out its first weekly gain in almost two months.
  • EU fails to agree €50bn Ukraine funding package.
  • AI presents growing risk to financial markets, US regulator warns.
  • OPEC+ now controls barely half of oil market, says IEA.

And finally

Clarence

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