The ASX 200 trod water rising 4 points to 8559 as CPI numbers came in below forecast. Narrow trading range. Banks were firm again, CBA up another 1.7% with the Big Bank Basket at $295.09 (+1.5%). Financials also doing well, GQG up 9.1% and XYZ up 1.0% with REITs better on rate cut hopes. GMG up 0.4% and CHC rising 1.2%. Industrials were mixed, retail better on rates, LOV up 1.9% and NCK rallying 3.3%. Travel stocks better too, CTD up 2.2% with LNW soaring as ALL fell 0.9%. SGH continue to push to new highs, QAN up 0.8% with VGN up 3.4% on day two.

Resources were once again under pressure. The big three are getting smaller, BHP down 1.0% and FMG off 2.3%. Lithium stocks fell, MIN off 6.0% and PLS falling 3.1%. Gold miners too slipping again as bullion eases back. NST down 2.6% and GMD down 4.0%. Oil and gas stocks continue to suffer despite crude finding buyers, STO down another 1.2% with uranium steady and coal down, WHC off 2.2%.

In corporate news, HUM got a NBIO from its chair, DRO soared 19.9% on a new EU contract, PNI down 3.7% as founder sold a parcel, PBH shareholders turned Japanese, SGR got shareholder approval for Bally and Mathieson to take the stakes. XRO in a trading halt with big capital raising and US acquisition worth $4bn.

On the economic front, the local monthly CPI came in below forecasts and rate cut hopes emerged.

Asian markets better Japan up 0.3%, China up 0.6% and HK up 0.8%. 10-year yields falling to 4.12%.

HIGHLIGHTS

  • Winners: DRO, TEA, LNW, GQG, CKF, SRG, RPL
  • Losers: PGC, EMR, MIN, DVP, MAH, VGL, CMM
  • Positive Sectors: Banks. Travel. Retail. Financials.
  • Negative Sectors: Iron ore. Lithium. Gold miners.
  • ASX 200 Hi 8577 Lo 8547. Narrow range.
  • Big Bank Basket: Higher at $295.09 (+1.5%). CBA hits record. Again.
  • All-Tech Index: Down 0.2%
  • Gold: Falls to $5128
  • Bitcoin: Rises to US$106,320
  • 10-year yield falls to 4.12%.
  • AUD: rises to 64.98c.
  • Asian markets: Japan up 1.1%, HK up 2.0% and China up 1.0%.
  • Dow futures up 31, and Nasdaq futures up 18 .
  • European markets set to open up very slightly.

MARKET MOVERS

  • DRO +19.9% new large EU contract.
  • GQG +9.1% webinar to come.
  • RPL +7.4% owns 10% DRO!
  • SLX +5.9% becoming a substantial shareholder.
  • CKF +8.2% broker upgrades.
  • SRG +7.6% contract wins.
  • LNW +10.5% big kick.
  • ELS +10.3% drone tech.
  • EBR +7.5% no reason.
  • HUM +11.5% chair makes NBIO at 58c.
  • PGC -11.4% management changes.
  • MIN -6.0% shorts back in charge.
  • DVP -5.2% presentation.
  • BBT -5.2% misses out on PBH.
  • ASL -13.9% Investment presentation.
  • AIS -5.9% Bell Potter top picks
  • Speculative Stock of the Day: OVT +167% on new CEO. Ex ZIP.

ECONOMIC AND OTHER NEWS

  • The consumer price index growth for May slowed to 2.1% year-on-year from 2.4% in April. Market consensus was for CPI expansion to slow to 2.3%. Trimmed mean inflation – the Reserve Bank of Australia’s preferred measure – came in at 2.4%, down from 2.8%.
  • Commonwealth Bank now expects the RBA to cut interest rates next month by a quarter of one percentage point following Wednesday’s softer-than-expected inflation figures.
  • Deutsche Bank, MST Marquee and RBC have joined in forecasting that the Reserve Bank of Australia will cut interest rates next month by 0.25%.
  • Buy now, pay later company Humm Group (HUM) confirmed it had received an offer from the family office of chairman Andrew Abercrombie.
  • Chinese Premier Li Qiang on Wednesday called on other countries to collaborate on trade, despite rising tariffs and other barriers.
  • Trump’s wavering on Nato defence pact casts pall over summit.
  • US strikes only delayed Iran’s nuclear progress, says intelligence report.
  • US liability insurance on verge of ‘breakdown’ from tide of claims.
  • Beijing vowed to respond to Taiwan’s “technological blockades” after it blacklisted Chinese companies including Huawei Technologies Co.
  • Banca Monte dei Paschi di Siena said the European Central Bank has given it authorisation to acquire a controlling stake in Mediobanca SpA.
  • The European Union wants China to resolve the current shortage of rare earth magnets before a meeting of their leaders next month.

And finally….

Clarence

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