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Marcus Today End Of Day Report
BY HENRY JENNINGS - MARCUS TODAY COMMENTATOR - 18/10/2017
VIEW MORE ARTICLES BY HENRY JENNINGS

 Market summary

  • ASX 200 up 1 point to 5890.5 fails to hold 5900 as profit taking creeps in.
  • High 5906 Low 5887.
  • Stellar run continues. Up 3.7% in October. History repeats.
  • Banks mixed with CSL update lifting sentiment in healthcare.
  • Miners under pressure on metal price falls.
  • Rio ex-executives charged with fraud.
  • TLS back to usual form.
  • AUD steady at 78.43c
  • US futures up 26.
  • Asian markets slightly higher with Japan up 0.01% and China CSI up 0.28%.

MT stuff:

  • No new trades. Stop losses raised.
  • In Marcus Call we look bubbles and the most important commodity of all.
  • Stock of the Day is BLD.
  • Small Stock Portfolio adds another stock.

FUTURES AND HIGHS AND LOWS

POINT CONTRIBUTIONS

Movers and Shakers

  • SBM +11.19% presentation to conference yesterday.
  • BIG +11.63% platform joins Apple TV.
  • LLC -10.48% broker downgrade and company trading update disappoints. Only sells 25% of retirement business.
  • CGF +3.41% still drawing strength from FUM numbers.
  • CIA -12.69% change in substantial holding.
  • BIN -9.52% dumped.
  • VOC -1.86% gives up recent rally as chief transformational officer leaves after three months.
  • LOV -2.92% profit taking.
  • BWX – trading halt on transaction.
  • VTG -3.87% diversifies into non-invasive surgery.
  • IFL +5.15% market cheers ANZ wealth deal.
  • JHX +3.31% plays catch up with US exposed BLD.
  • APT +10.21% very positive trading update.
  • AGL +2.11% new NEG reform package cheers.
  • Speculative stocks of the day: ADO +177.78% after the company engaged a US based battery consulting company to undertake a third-party review of its surface nano-coating technology for use in LiO batteries. A tick of approval is sending the IP to the next level.
  • Biggest risers – SBM, IFL, APT, EWC, JHX, ACX and GXY.
  • Biggest fallers – CIA, LLC, BIN, ALU, CLQ and JBH.

TODAY

  • Rio Tinto (RIO) -0.76% US regulators on Tuesday sued Rio Tinto PLC and two former top executives, following allegations they deceived investors about the value of Mozambique coal assets obtained in a disastrous acquisition that caused huge losses for the global mining giant. RIO says it will defend against the allegations and says the case is 'unwarranted'.
  • Brambles Limited (BXB) +0.76% Has released its first quarter trading update for FY18. Sales revenue for the first three months is up 8% on the prior corresponding period at actual FX rates, and 6% at constant currency. Brambles’ CEO Graham Chipchase has said the numbers are in line with expectations for mid-single digit revenue growth through the cycle.
  • BHP Billiton (BHP) -0.51% Has released its operational review for its first quarter today. CEO Andrew Mackenzie has noted, performance in the first quarter has kept the company on track to deliver 7% volume growth in FY18. All production and unit cost guidance remains unchanged for the 2018 financial year and all major projects under development are tracking to plan. 
  • CSL Limited (CSL) +1.80% Has had their 2017 AGM today. The company reaffirmed guidance for FY18 NPAT, expected to come in around $1,480m - $1,550m on a constant currency basis.
  • Crown Limited (CWN) -4.34% Allegations tabled in the Federal Parliament about tampering with betting options has sent the stock southward today. A paper tabled by MP, Andrew Wilke alleges that the casino tampered with poker machines so that punters would continue to bet, and also turned a blind eye to illicit drug use. The paper accompanies a 30-minute video of three former staff members substantiating the accusations. Crown has strenuously denied any wrong doing.

ECONOMIC NEWS

  • Westpac's Leading Index for September has indicated that the economy may be slowing. The index fell to -0.21% in September from -0.16% in August. Westpac said it relates to lost momentum in the economy - particularly in terms of the consumer, who is weighed down by weak wages growth, higher energy prices and increasing household debt.
  • The NAB's cashless retail sales index rebounded in September. Retail rose by 0.6% for the month; but on a YoY basis, it has dropped 5.5%.

BEST AND WORST

BOND MARKET

 

ASIAN MARKETS

Chinese 19th Plenum kicks off as the festivities begin.

Main points so far in a speech over three hours. Imagine that. Mao’s speeches went on for days.

  • Xi Jinping vowed to maintain the State's role in managing the economy, as he pledged the country would not close its doors to the world.
  • Still talking tough on corruption and environmentalism.
  • Pledged to make interest rates and the currency more market orientated, without providing details.
  • Goal of making China a "manufacturer of quality" and an "innovative nation".
  • Xi also hailed the rise in China's international standing.
  • The economy remained "unbalanced" and more needed to be done to protect the environment.
  • `No country can afford to retreat into self-isolation'. Aimed at Korea and Trump maybe?
  • Love the long-term thinking. Chinese Military to Become World's First-Class Force by 2050.
  • "One nation, two systems'' best solution for Hong Kong, Macau. Even Pauline Hanson got a mention it seems. One China focus. Think he is talking about HK.
  • Here’s a novel thought and from China too. "Houses are for living in, not for speculation". Not sure that will catch on here.

EUROPE AND US MORNING HEADLINES

  • Mark Carney reaffirmed that the Bank of England is close to its first interest-rate increase in over a decade.
  • Marc Faber has been banned from some networks as a talking head after racist comments.
  • The UK Government is set to tighten its grasp on merger and takeover deals in the interest of national security, setting out fresh rules. Currently the Government only has the power to block a deal if a business has a UK turnover of more than GBP70m; it now proposes to drop it to GBP1m if it is involved in certain sectors. City not happy.

 

MARKET MAP

 



View More Articles By Henry Jennings

Henry Jennings has been involved in financial markets for over 35 years as both a trader and a broker in London and Sydney.

Starting his career in London trading derivatives and moving to Australia in 1989, Henry eventually settled at Macquarie Group, rising to become a Divisional Director responsible for Equity Trading in Australia. For the last decade, Henry has been involved in private client broking and now writes exclusively for the renowned financial newsletter Marcus Today. Henry regularly appears on ABC TV and Sky Business as a market analyst, commentator and strategist and has presented at various conferences most recently for the AIA on the Gold Coast.

To gain further insights from Henry Jennings, Marcus Padley and the Marcus Today team of analysts, click here to register for a free trial of the Marcus Today daily newsletter.



Important note: Any financial product advice contained in this email is general financial product advice only and does not take into account any one person's objectives, financial situation or needs. Therefore, before acting on any financial product advice in this email, you should consider, with or without the assistance of an independent adviser, the appropriateness of the advice, having regard to your objectives, financial situation and needs.
 

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