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Marcus Today End Of Day Report
BY HENRY JENNINGS - MARCUS TODAY COMMENTATOR - 07/02/2018
VIEW MORE ARTICLES BY HENRY JENNINGS

 Market summary

  • ASX 200 bounces 44 points to 5877. Not convincing.
  • High 5939 Low 5858.Strong volumes.
  • CBA results underwhelm. Other banks follow on close.
  • Insurers and Telcos fail to fire.
  • Utilities rally slightly.
  • Energy and materials stand out.
  • RIO results due after hours.
  • AUD slips to 78.78c as USD gains ground on rate rise trajectory.
  • AUD Bullion price $1329.
  • Bitcoin rallies after wild ride US$7400
  • US futures slips in quiet trade down 113 after huge volatility
  • Asian markets mixed with CSI 300 down 0.75% and Japan +0.85%.

Mt Stuff

  • HENRY CALL – We witnessed a ‘volatility event’ last night. Will we see a return to normality? Henry discusses our cash position relative to the giant rally on Wall Street overnight. We also talk CBA and RBA meeting.
  • TRADING PORTFOLIO – We were stopped out on a few positions yesterday but remain long on a few others. Downside to stop losses but they certainly have their place in markets like these.Discipline  and cash preservation the key.
  • SMALL STOCK PORTFOLIO – Henry is all cashed up, but risk management is key. He talks about the stocks he’s still keen on, even amid the volatility.
  • 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 +11.46% risk on back in lithium ORE +3.65%. JP Morgan upgrades helping.
  • PLS +6.25% rated neutral by JP Morgan.
  • APX +9.73% tech rally helps.
  • MYR -2.31% Premier Investments ramps up board pressure for EGM.
  • A2M +5.15% buyers return.
  • SWM -3.85% media stocks fall.
  • SBM -2.70% gold under pressure as risks fade.
  • SEA -15.96% acquisition and capital raising imminent.
  • GMA -2.14% profits disappoint.
  • WBC -0.10% upgraded to a Buy by Morningstar.
  • EOS -2.61% placement weighs.
  • AC8 +25.5% medicinal marijuana stocks rally.
  • Speculative stock of the day: WPG Resources (WPG) +87.50% after spectacular Tarcoola grade control intersections of 73.31g/t of Au from 11m. 26.74g/t Au from 4m drill hole.
  • Biggest risers – IEL, AJM, GXY, APX and KDR.
  • Biggest fallers – YAL, SWM, EVN, EWC and SBM.

TODAY

  • Commonwealth Bank (CBA) -0.79% A slight miss from some forecasts of $5.2bn coming in at $5.11bn. The bank also took a $575m charge against AUSTRAC and other regulatory issues. The dividend has been raised to 200c from 199c another sign of confidence and the Net Interest Margin (NIM) is up 6bps to 216 bps. CBA has some clouds as do the other banks with Royal Commission and housing slowdown etc.
  • Nick Scali (NCK) -1.15% 1H FY18 results announced today. Sales up 8.1% on pcp to $128m. Like for like sales growth up +2.6% assisted by six new store openings. Gross margin increased 90bps to 62.6%. NPAT increased 15% to $23.5m. Operating expenses decreased 35.2% of sales. The company announced a 20c final dividend, and a 16c half year dividend for FY18.
  • Carsales (CAR) -1.74% Net profit was up 12% on year but fell short of expectations from Ord Minnett who anticipated a 14.7% lift in normalised net profit. There were also concerns that Carsales’ core business growth was mainly driven by fee hikes, which have brought into question if it is sustainable or not.
  • Murry Goulburn (MGC) -unchanged- Reported a first half fall in revenue of 5%, a $27.5m loss and a lift in debt. The company warned if a deal with Canada’s Saputo isn’t successful, the group's uncompetitive milk price may result in more milk losses, trigger impairments and covenant breaches and the potential loss of creditors' support.
  • Premier Investments (PMV) -0.36% Has asked Myer's share register to request an EGM to vote on replacing Myer's board.
  • WiseTech Global (WTC) +2.59% acquires Belgian logistics solutions provider Intris, the latest deal in a bolt-on strategy. Intris had 2016 annual revenue of $7.1m and EBITDA of around $1.1m. The acquisition cost is around $17m.

ECONOMIC NEWS

  • The Living Cost Index of wage-earning households rose by 0.7% in the December quarter, above the consumer price index of 0.6%, CommSec reports.
  • The Australian Industry Group Performance of Construction index rose by 1.5 points to 54.3 in January.

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ALL ORDS SECTOR SUMMARY

ALL ORDS TOP MOVERS

ALLORDS BOTTOM MOVERS

ASX 200 SECTOR SUMMARY

ASX 200 TOP MOVERS

ASX 200 BOTTOM MOVERS

BOND MARKET UPDATE

ASIAN MARKETS

  • Hong Kong deadly flu outbreaks spreads.
  • Singapore based guru, Steve Diggle says volatility is here to stay. His fund made US$2.7bn in GFC. Knows his stuff.

  • Goldman Sachs is standing by its very bullish call on commodities. Goldman forecast copper rallying to $8,000 a ton in 12 months, Brent crude topping US$82 a barrel within six, and iron ore gaining to US$85 a ton in three. Not got a great track record.

EUROPE AND US MORNING HEADLINES

  • Elon Musk has successfully put a Tesla into space. Probably the best place for it.
  • Steve Wynn has stepped down from Wynn Resorts.
  • A German union has won the landmark right to a 28-hour week.
  • US trade deficit has grown by 12.1% under Trump.
  • LA Times to be sold to biotech billionaire, Patrick Soon-Shiong.
  • Coming to a Coles or Woolies perhaps? UK supermarket Waitrose is trialling yoga classes in three supermarkets with plans for a full roll out.

 

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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