End Of Day Report

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Friday, 21 April 2017
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END OF DAY SUMMARY APRIL 21 2017

Welcome to the Marcus Today End of Day Report.


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ASX 200 kicks another 33 points to 5854 as banks and miners lead the charge into the French elections. Coca Cola loses its fizz on local sales issues. Asian markets modestly higher with Hong Kong up 0.23% and Japan up 0.81%. AUD solid at 75.34c and DOW Futures up 23 points.

For the week, our market has slipped from 5889 to 5854 down 0.6%.

  • The Big Bank Basket slid from $185.99 to $184.87.
  • BHP dropped from 2431c to 2404c (-1.11%).
  • RIO (RIO) up from 5915c to 6024c (+1.84%).
  • Telstra (TLS) up from 416c to 423c (+1.68%).

FUTURES AND HIGHS AND LOWS

STOCKS AND SECTORS

  • Miners had a good day after the iron ore prices turned a corner yesterday. BHP +1.65%, RIO +2.68% and Fortescue Metals (FMG) +5.21%. A good solid bounce from base metal stocks led by South32(S32) +2.21%, Iluka Resources (ILU) +4.91%, Alumina (AWC) +1.12% and Independence Group (IGO) +4.43% out of the dog house at least for the time being.
  • Energy stocks mixed as Woodside (WPL) -0.65% suffered after the production report yesterday. Caltex (CTX) +0.86%, Origin Energy (ORG) +0.82% and Oil Search (OSH) +0.70%. Coal miners picked up with Whitehaven (WHC) +1.06% and New Hope (NHC) +0.57%.
  • Gold miners modestly higher Newcrest (NCM) unchanged, Northern Star (NST) -0.43%, Evolution Mining (EVN) +1.26% and Westgold (WGX) +0.49%.
  • Industrials slightly easier as Brambles (BXB) -0.91% and Sydney Airport (SYD) -2.02% fell away as the decision looms for the second airport and the government starting earthworks. Positive numbers too for the gaming stocks as Crown Resorts (CWN) +0.25%, Aristocrat Leisure (ALL) +1.48% and Jumbo Interactive (JIN) +7.96%.
  • Healthcare mixed CSL +0.38%, ResMed (RMD) -0.87% and Fisher & Paykel (FPH) -1.66%.
  • Banks and financials better again with the Commonwealth Bank raising rates again on both owner occupier and investor loans. Interest only investment loans are set to rise 0.5%. Three-year fixed rate interest-only investment loan rates will rise by 0.5% to 4.94%. The Big Bank Basket rose to $184.87 with insurers better IAG +0.83% and QBE Insurance (QBE) +0.56%. Wealth managers modestly better with Macquarie Group (MQG) +0.99% after snagging the Green Investment Bank in the UK.
  • Telcos easier today after a volatile week as the chief strategy officer at Vodafone questioned the ability of TPG Telecom (TPM) -2.15% to build a fourth network for the $600m it had planned. Vocus (VOC) -3.23% resumed its decline and Telstra (TLS) -0.47% in profit taking mode.
  • Speculative stock of the day: MaxSec (MSP) +42.11% after an Ava Global update on its secure logistics division increasing revenues by 360% over Q2FY17 and a positive start to the final quarter.

BEST AND WORST

CORPORATE NEWS

  • Duet Group (DUE) +9.45% after FIRB approved the takeover from Hong Kong CKI at 303c after a long five months and shareholders have agreed as the takeover looks to be heading for resolution. The approvals may have knock on effects for the rest of the sector with Spark Infrastructure (SKI) +0.41% and AusNet (AST) +1.78%.
  • Coca-Cola Amatil (CCL) -10.52% has backed away from its promise of mid to single-digit earnings growth, as trading in Australian has been weaker than last year with all channels experiencing volume and price pressure.
  • Chevron has lost a big tax appeal against the ATO which is set to make life tougher for other multinationals around the world. The US giant will be stung with a $300m bill and costs after losing to the ATO in a issue with intercompany loans.
  • Oz Minerals (OZL) +2.62% after announcing it is pushing on with its $1bn Carrapateena earlier than expected, locking in early stage contractors. This move further de-risks the project. Production numbers were affected by the weather but the company reaffirmed its guidance of 105k to 115k tonnes of copper and 115k-125k ounces of gold.

BOND CORNER

ASIAN NEWS

  • Shanghai is heading for its worst week this year with a 2.2% fall in the Shanghai Composite Index .The securities regulator has stepped up criticism of what it called disruptive trading behaviour, with chief Liu Shiyu saying the nation’s markets should punish irregularities “without mercy.

EUROPE AND US

  • Allons-y. French election results will start to come through around 4am on Monday morning. Macron is the market favourite.

  • President Trump has called it a ‘historic day’ for US Steel as he has launched an investigation into foreign imports of cheap steel. The commerce department investigation could be completed in as little as 50 days, he said, a timeline that is well ahead of the 270 days called for under law. Chinese exports of steel into the United States are reaching the point where they now have 26% of the market.
  • More M&A activity in the UK with WS Atkins agreeing to a £2.1bn takeover by Canadian rival SNC-Lavalin. Atkins' board last night agreed to a cash takeover at £20.80-a-share, some 35% above its closing share price on March 31 when the talks first emerged. 

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