The ASX is up 48 points in mid morning trade on “perfect” US jobs number. Strong employment growth with benign wages growth. Gold the only sector in the red. BSL up on tariff news, NCM down on Cadia suspension.  #ausbizMMM8MMM9MMM10


  • Ex-dividend – APN Outdoor Group (APO) 12.5c, Caltex (CTX) 61.0c, ICSGlobal (ICS) 2.5c, Independence Group (IGO) 1.0c, Lovisa Holdings (LOV) 13.0c, Naos Emerging Opportunities Company (NCC) 3.8c
  • Chinese data – New Yuan Loans, FDI
  • Japanese – Large Manufacturing


  • US Treasury Budget


  • Here There & Everywhere (HT1) – Adshel extends Sydney trains contract
  • Regis Resources (RRL) – Regis targets underground mine at Rosemont with maiden underground resource of 230koz.
  • Newcrest Mining (NCM) – Cadia Northern Tailings Dam embankment breakthrough. No environmental damage identified. Operations have been suspended. Will have an adverse impact on guidance for FY18 given the contribution of Cadia to the overall outcomes of Newcrest.


  • Sydney Airport (SYD) – Macquarie has upgraded to an Outperform (from Neutral) recommendation and raised its target price to $6.85 from $6.40 after a review, expecting management will maintain growth at least until the Western Sydney Airport opens. They think it is undervalued relative to Auckland International Airport (AIA), considering its stronger international passenger outlook.
  • Bank of Queensland (BOQ) – Morgans has upgraded to an Add (from Hold) recommendation. The analyst expects special dividends due to BOQ’s strong capital position and surplus franking credits, and thinks the interim CET1 ratio target (9.25%) will end up being too conservative…allowing potential for further capital management initiatives. While cash earnings forecasts have been cut 2.0% for FY18 and by 4.0% for FY19 and interest and margins have also been lowered, the recommendation is improved.
  • Inghams Group (ING) – UNS has downgraded to a Neutral (from Buy) recommendations on a valuation basis.
  • Japara Healthcare (JHC) – JHC has downgraded FY18 EBITDA guidance (to -14-19% below FY17guidance) after the Federal Court ruled that billing residents for asset replacement charges is inconsistent with the legislation. Morgans has reduces estimates as a result. The analyst has kept a Hold recommendation but cut their target price to $1.93 from $2.03, and does not rule out corporate activity given the strategic holding of Moelis Australia. Morgans believes it will be another six months before the market gains confidence in a recovery in operations.
  • Nufarm (NUF) – Macquarie has cut its FY18 EPS estimates 13% and FY19 by 4%  due to the timing of acquisitions but remains positive on the growth outlook. A skew to 2H is expected, while seeds development provides further options on growth. The target price has been cut to $10.17 from $10.29.




US EQUITIES – S&P500 +48 (+1.74%), Dow Jones +441 (+1.77%), Nasdaq +133 (+1.79%)

Main themes –

  • Risk appetite boosted by North Korea’s offer to meet with President Trump
  • February Employment report well ahead of estimates, but average hourly earnings growth slowed to 0.2% and 2.6% for the year.

EUROPEAN MARKETS – Mostly stronger. STOXX +0.43%, UK FTSE +0.30%, German Dax -0.07%, French CAC +0.39%. Italy +0.06%.


  • The US dollar was down 0.08% at 90.10.
  • The Aussie dollar has rallied strongly – up 0.8% at US78.55c.

BONDS – 2-yr: +3 bps to 2.27%, 5-yr: +2 bps to 2.65%, 10-yr: +2 bps to 2.89%, 30-yr: +3 bps to 3.16%


  • WTI oil was up US$1.92 or 3.2% at US$62.04. In addition to bullish sentiment on North Korean developments, Libya’s 70,000 barrels per day El Feel oilfield stayed shut despite the Petroleum Facilities Guard saying it had reached a deal to reopen it.
  • Gold futures were d were little changed, up 0.1% at$1323.00.
  • Iron ore fell US$1.50 to $76.00.
  • LME metals were mostly stronger – copper +1.01%, nickel +4.45%, aluminium +0.66%.


  • US economic data – February Nonfarm Payrolls 313K (consensus 210K; prior 239K revised from 200K), Nonfarm Private Payrolls 287K (consensus 195K; prior 238K), Unemployment Rate 4.1% (consensus 4.0%; 4.1%), Average Hourly Earnings 0.2% (consensus 0.2%; prior 0.3%), and Average Workweek 34.5 (consensus 34.4; prior 34.4); January Wholesale Inventories 0.8% (consensus 0.7%; prior 0.4%)
  • Fed Speak – Boston Fed President Eric Rosengren said that the Fed may need to accelerate the pace of its rate hikes. It follows comments from normally quite dovish officials like Chicago Fed President Charles Evans and Fed Governor Lael Brainard, who also signaled their support for maintaining the tightening stance.
  • European dataGermany – January Imports -0.5% (expected -0.1%; last 1.1%) and Exports -0.5% (expected 0.3%; last 0.3%); Industrial Production -0.1% (expected 0.5%; last -0.5%): France – January Industrial Production -2.0% (expected -0.2%: last 0.2%): Italy – January PPI +0.7% (last 0.4%) and +1.7%yoy (last 2.0%): Spain – Industrial Production +1.2%yoy (consensus 5.1%; last 5.8%)
  • UK – January trade deficit £12.32bn (expected deficit £12.00bn; last deficit £11.77bn). January Industrial Production +1.3% (expected 1.5%; last -1.3%) and +1.6%yoy (consensus 1.8%; last 2.6%). January Manufacturing Production +0.1% (expected 0.2%; last 0.3%) and +2.7%yoy (consensus 2.8%; last 1.4%). January Construction Output -3.4% (expected -0.3%; last 1.6%) and -3.9%yoy (consensus -0.5%; last -0.2%)
  • Chinese data Friday – Inflation rose 2.9% over the year, up from 1.5% over the year to January. It’s the strongest growth in 4 years. PPI fell to 3.7%, the lowest rate of growth in 15 months.


  • Goldman Sachs (+1.66%) underperformed the sector following reports that its CEO Lloyd Blankfein is preparing to step down after serving at the helm for more than 12 years. Co-presidents Harvey Schwartz and David Solomon are the two front runners for the role.




  • It’s a short week in Melbourne due to Labour Day but the stock market will be open. Home loan data, including investment lending, will be released on Tuesday along with Westpac’s consumer confidence index
  • In China, credit data is released on Monday, and Wednesday features fixed asset investment, industrial production and retail sales.
  • The minutes from today’s Bank of Japan meeting are released next Wednesday, and other key Japanese data includes PPI on Tuesday, and capacity utilisation and industrial production on Friday.
  • European data includes industrial production and employment change on Wednesday, and inflation and wages growth on Friday.
  • In the US, CPI on Tuesday will be a major focus, along with PPI and retail sales on Wednesday and housing starts, building permits, industrial production and consumer sentiment on Friday.



“Your employees come first. And if you treat your employees right, guess what? Your customers come back, and that makes your shareholders happy. Start with employees and the rest follows from that.” – Herb Kelleher, American businessman born this day in 1931.


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