RunningMoney

The ASX200 is up 32 points in early trade, with most sectors OK. Cons Staples weaker. Another day, another result. NXT great!. WOW and MYO not so. Upgrades for FLT. CBA responds to AUSTRACK.  #ausbiz

TODAY

• Dividends – Evolution Mining (EVN) 3.5c, Helloworld Travel (HLO) 7.0c, IOOF (IFL) 27.0c, Ingenia Communities (INA) 5.1c, Oohmedia (OML) 10.5c, Whitehaven Coal (WHC) 13.0c
• Japanese CPI
• Chinese house price data over the weekend
• TONIGHT
• Fed Speak – New York Fed President (permanent voter) William Dudley, Boston Fed President (alternate voter) Eric Rosengren, Cleveland Fed President (FOMC voter) Loretta Mester, San Francisco Fed President (FOMC voter) John Williams

COMPANY NEWS

• Commonwealth Bank (CBA – Has lodged a response to amended AUSTRAC and class action claims. Admits 11 fresh allegations “in part” in AUSTRACK case. Denies most of the additional allegations. Denies allegations of liability in class action caseand will vigorously deny the claim
• NextDC (NXT) – Profit after tax down 54% to $8.4m (tax benefit of $11.3m in 1H17), but profit before tax up 54% to $12.3m. Revenue up 32%.  Reported higher utilisation levels and project fees, leading to a guidance upgrade. FY18 revenue guidance now $152-158m (was $146-154m) and underlying EBITDA guidance $58-62m  (from $56-61m). Key factors (+/-) which resulted in the FY18 guidance: ✓ Better than expected 1H18 result; ✓ Higher than expected utilisation levels at the end of 1H18; ✓ Record project fees in 1H18; ✓ Record interconnection ecosystem growth in the 1H18; x Higher operating costs in 2H18 relative to 1H18 driven by timing of new IT investments; x Full six months of B2 and M2 facility costs in 2H18; x Higher energy prices to be absorbed during 2H18; and x Decision to invest in several new growth projects which will add to operating costs in 2H18
• Woolworths (WOW) – Group NPAT +37.6% to $969m (NPAT from continuing operations +14.7% to $902m). Consensus estimate was %941m, Citi estimates was $961m. Aus Food comparable sales up 4.9%. Dividend 43c. Sales up 3.8% overall. Big W sales up 1.1%. Hotels up 4.0%, petrol up 5.1%. Dan Murphy’s strong sales however Endeavour Drink’s gross margins declined 13bps to 23% due to a competitive market environment, a change in sales mix and minor reclassification of costs. BIGW still looks to be the issue

• MYOB Group (MYO) – FY. Underlying EBITDA +10.8% pcp to $189.9m and NPAT +16.3% pcp to $60.7m (Consensus est $107m, Citi est $104m). Revenue +12.4% pcp to $416.5m. Dividend 5.75c. Subscriber growth of 60% over the year and  on track to reach 1m online subscribers by 2020.
• Mayne Pharma (MYX) – Adjusted EBITDA down 36% to $70.2m Revenue -17% to $243.3. 1H performance reflected a “challenging generic environment and a disappointing specialty brands result”. Commented on a positive trading environment over the last 3 months, with stronger 2H expected driven by “the stabilising generic market, new product launches, increased share penetration of on market products, portfolio optimisation and expanding distribution channel. SBD is poised to benefit from the expansion of the dermatology sales team which was completed in December 2017. MCS key performance indicators are trending favourably for growth over the remainder of the financial year with committed business up 30% from twelve months ago. MPI is expected to benefit following the launch of Monurol and Urorec in 1HFY18.”
• Tassal Group (TGR) – Underlying profit up 26.8% to $25.9m. Revenue up 23.7%. Dividend 8c (up 6.7%). Benefit from “better than forecast growth in local demand and increasing domestic returns for high quality salmon, while De Costi Seafoods continues to leverage other seafood diversification to also generate increasing returns”. Outlook statement generally positive “expects to deliver another record result in FY18”.
• Automotive Holdings Group (AHG) – NPAT down 2.4% to $39.9m, revenue up 7.5% to 2.87bn. Dividend of 9.5c. Focus on restructure and margin improvement has allowed them to “make the most of challenging and competitive market conditions” whilst it will continue to review businesses with a review to divest or restructure. FY18 outlook dependent on the timing of refrigerated Logistics business sale, but the broader market for vehicle sales looks positive.

BROKER CHANGES

• Appen Group (APX) – Canaccord Genuity has raised its target price by 13% to $10.80
• Perpetual (PPT) – Credit Suisse has downgraded to Neutral (from Outperform)
• Webjet (WEB) – Credit Suisse has upgraded to an Outperform (from Neutral) recommendation and raised its target price by 16% to $13.65, Morgan Stanley has raised its target price by 9.6% to $10.30.
• Oz Minerals (OZL) – Chaw & Partners has raised its target price by 25% to $13.00
• Catapult (CAT) – Morgans has cut its target price by 32% to $2.02. Canaccord Genuity has cut its target price by 8.3% to $2.20. Bell Potter has cut its target price by 20% to $1.60
• Smart Group (SIQ) – Morgans has raised its target price by 4.6% to $11.70. Morgan Stanley has raised its target price by 51% to $12.35.
• Flight Centre (FLT) – Citi has upgraded to Neutral (from Sell) and has raised its target price by 20% to $54.00Morgan Stanley has upgraded and raised its target price by 42% to $54.00.Morgans has raised its target price by 105 to $13.75. Credit Suisse has raised its target price by 7.2% to $42.08. UBS has raised its target price by 13% to $60.70
• ARB – Citi has downgraded to a Neuitral from Sell but raised its target price by 26% to $22.43.
• Blackmores (BKL)- Credit Suisse has downgraded to Neutral (form Outperform) and cut its target price by 13% to $130.00
• Kogan (KGN) – Canaccord Genuity has raised its target price by 43% to $10.70.
• Westfield (WFD) – Citi has cut its target price by 8.6% to $8.56.
• Bellamy’s (BAL) – Bell Potter has raised its target price by 11% to $14.478.

OVERNIGHT

SPI FUTURES +36

US EQUITIES – S&P500 +3 (+0.10%), Dow Jones +165 (+0.667%). Nasdaq -8 (-0.11%)

Main themes –

• Another day when you can forget the Dow Jones as the indictor of US share performance.
• Financials underperform as Treasury yields come off from multi-year highs

EUROPEAN MARKETS – Mixed. STOXX -0.20%, UK FTSE -0.40%, German Dax -0.07%, French CAC +0.13%.

CURRENCIES

• The US dollar lost some of its recent gains, down 0.29% at 89.74.
• The Aussie dollar is trading at US78.45c.

BONDS – 2-yr: UNCH at 2.26%, 5-yr: -3 bps to 2.65%, 10-yr: -2 bps to 2.92%, 30-yr: -1 bp to 3.21%

COMMODITIES

• WTI oil was up US98c or 1.6% at US$62.77. US crude inventories 1.6mb (increase of 1.8mb expected) as net imports dropped to a record low and exports surged. Crude stocks at the closely watching Cushing, Oklahoma delivery hub for WTI fell by 2.7mb.
• Gold futures were little changed, down 0.7% to US$1,331.10
• Iron ore down US20c at $78.10.
• LME metals were mostly lower – copper +0.60%, aluminium -0.73%, nickel -0.11%

ECONOMIC DATA, NEWS & POLITICS

• Chesapeake Energy (+21.7%) rallied after better-than-expected Q4 results.
• US economic data – Weekly Initial Claims 222,000 (consensus 233,000; prior 229,000) and Continuing Claims 1.875m (prior 1.948m); Leading Indicators 1.0% (consensus 0.8%; prior 0.6%)
• European data – Germany Ifo Business Climate Index 115.4 (expected 117.1; last 117.6). February Business Expectations 105.4 (expected 107.9; last 108.3); French January CPI -0.1% as expected (last -0.1%).
• UK Q4 GDP +0.4% (expected 0.5%; last 0.5%) to be +1.4%yoy (expected 1.5%; last 1.5%). Q4 Business Investment 0.0% (expected 0.5%; last 0.5%) to be +2.1%yoy (consensus 2.4%; last 1.7%). February CBI Distributive Trades Survey 8 (expected 13; last 12)