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SHARECAFE COMMENTARY

Marcus Today End Of Day Report
BY HENRY JENNINGS - MARCUS TODAY COMMENTATOR - 12/02/2018
VIEW MORE ARTICLES BY HENRY JENNINGS

Market summary

  • ASX 200 sags -17 points to 5821 in quiet start to week. CPI awaits.
  • High 5840 Low 5791.
  • Banks slip as RC kicks off with banks admonished by commision head.
  • Miners rally on higher ore prices. BHP/RIO lead the way.
  • Copper higher in Asia.
  • Bond proxies and utilities slip as bonds head higher.
  • AUD lifting to 78.30c
  • Bitcoin pushing higher to US$8498
  • AUD Bullion around $1690.
  • US futures finding support up 167 points.
  • Asian markets better though Japan closed. Chinese CSI up 0.64% and HK up 0.49%.

FUTURES AND HIGHS AND LOWS

Mt Stuff

  • MARCUS CALL – Marcus is back from holidays - having sold down on the Collins Class Rule (before the big falls) we look at what to do now.
  • FOR BALANCED INVESTORS - Some soothing words.
  • TRADING PORTFOLIO - Only two trades left and in no mood to add any yet.
  • SMALL STOCK PORTFOLIO – Henry is still cashed up and is ready to spend when the market finds its bottom.
  • INSIDERS – N17THFC recommends ETF, BBUS to hedge the current volatility. Henry explains hedging.
  • INSIDERS CONNECT WITH US - We invite you to send us your own stock ideas. We also have the facility for you to email us any questions. Click on the "Ask Marcus Today" button in the newsletter or below - Ask us anything:

https://marcustoday.com.au/webpages/images/report/20171016/askmarcusbutton.jpg https://marcustoday.com.au/webpages/images/report/20171016/tellusyourstockideas.jpg

Advancers and Decliners

  • GXY +5.59% lithium bounce as buyers return. Citi upgrades ORE and GXY.
  • SWM -5.71% now is the Winter Olympics of our discontent.
  • NXT +4.53% bargain hunting.
  • TLS -1.15% continues lower.
  • WSA +0.99% commodities better.
  • REA +2.67% positive results and broker upgrades.
  • JBH -8.00% February sale. Guidance disappoints.
  • HVN -3.63% follows JBH lower.
  • APT -4.09% profit taking continues.
  • WEB -4.06% consumer stocks struggle.
  • MYR -5.98% the rout continues. Record low.
  • ERA -0.67% annual report.
  • KGN- 3.22% JBH results weigh.
  • WGX -2.24% freak storm affects production.
  • AXP -1.71% on 15k shares.
  • NEA +6.04% rally continues.
  • BIG +12.50% fires back and clarifies finance arrangements.
  • MWR +35.82% investor update on kids’ smart watch trackers.
  • Speculative stock of the day: Imugene (IMU) +35.29% Solid volume today after announcing the Anti-PD-1 vaccine is ready for development after extensive trials at the Medical University of Vienna. Ah Vienna.
  • Biggest risers – GXY, NXT, EHL, YAL, MYX, ASL and S32.
  • Biggest fallers – SWM, SYR, JBH, SXY, SPL and WEB.

TODAY

  • Contact Energy (CEN) +1.23% 1H results indicated a 40% fall in profit to NZ$58m after a dry weather spell impacted. EPS down 40% to 8.1NZc. Operating cash flow NZ$141m, up 5%. Dividend up 18% to 13cps.
  • Amcor (AMC) +0.56% 1H net profit US$329.7m, up 15% on year and in line with company guidance. EPS up 4% and margins expanded 11.4%. Short term industry challenges included higher raw material costs in flexibles; weak volumes in rigid plastics and mixed conditions in emerging markets. Guidance - Net interest costs of US$195m – US$205m. Free cash flow of US$150m-$250m. The company says it expects a modest pretax growth in flexibles.
  • Aurizon Holdings (AZJ) +1.96% 1H net profit A$281.5m, up 52%. Underlying EBIT A$485.3m, down 5%. Interim dividend of 14cps up 3%. The company has cut above-rail coal guidance to 210-220m from 215m-225m, citing revised operating and maintenance plans. The company said 75% of its A$300m buyback has been completed.
  • JB Hi-Fi (JBH) -8.00% 1H net profit of A$152m, up 37%. 1H revenue A$3.7bn, up 41%. Total January sales increased 7%, and comparable sales rose 5%. Interim dividend of 86cps. The company says its expects FY18 group sales to near A$7bn. Guidance now for sales of $6.85bn for the year, compared with previous guidance of $6.8bn. JB Hi-Fi sales are expected to reach $4.75bn (previous guidance $4.65 billion) and The Good Guys sales are expected to reach $2.1bn compared with a previous forecast of $2.15bn.
  • Bendigo Bank (BEN) -2.05% 1H results released. Net profit A$231.7m up 11%; 1H income from operations A$842.9m, up 6%. Cet1 capital ratio 8.61%, up 64 basis points on year; 1H cash earnings A$225.3m, up 11%. 1H impaired assets decreased by A$11.9m or 4%; 1H bad debts up A$6.5m, or 16%.
  • Ansell (ANN) -3.87% 1H net profit US$428.2m. 1H revenue down 1.2% at US$766.4m. The company lifted FY18 EPS guidance to US96c – US105c and said the underlying business was performing in line with earlier guidance. ANN will pay an interim dividend of 20.5cps.
  • Get Swift (GSW) - Still suspended as it cannot guarantee that it is in compliance with ASX listing requirements. The saga continues it seems, with the company announcing (very late Friday) it had retained a US legal firm to handle any potential takeover approaches.
  • Fletcher Building (FBU) - Extended a trading halt on its shares for a further 48 hours as it finalises the extent of the mounting losses in its troubled building and interiors division. It announced that it started talks with its bankers in relation to breaches of debt covenants.

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BOND MARKETS

ALLORDS MARKET SUMMARY

ALL ORDS TOP MOVERS

ALL ORDS BOTTOM MOVERS

ASX 200 MARKET SUMMARY

ASX 200 TOP MOVERS

ASX 200 BOTTOM MOVERS

ASIAN MARKETS

  • Looks like the Chinese have got the travel bug. By 2021, Chinese tourists will spend US$429bn.

  • At least 178 new airports are planned in Asia-Pacific. Plenty of concrete needed.
  • During the next three years, Japan, Thailand, the US and Australia top the must-visit list according to a report from CLSA. Bear in mind that only 5% of Chinese have a passport still. 10m a year are being issued annually.

EUROPE AND US MORNING HEADLINES

  • Everyone is betting on more volatility. The weekly commitment of traders’ report shows non-commercial positioning in VIX futures contracts spiked to a record net long of 85,818 contracts as of Feb 6.

  • Fidelity, one of the largest retail brokerages in the US, has temporarily stopped clients from buying an exchange traded fund that bets on markets remaining calm and was a victim of this week’s market rout.
  • Foreign exchange giant owned by Travelex billionaire, Bavaguthu Shetty has adopted Ripple, a cryptocurrency. Ripple has increasingly been adopted by payment networks and banks, including UBS and Santander for its settlement technology and international payments. The Ripple network, which launched in 2012, acts as a system for verifying and recording transactions of various assets including its own XRP.

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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