The ASX200 is down 18 points in mid-morning trade. Resources ok on big moves in metals prices but everything else ↓. Key ex-div AMA 2.0c, BRG 16.5c, FLT 107.0c, GEM 4.5c, MND 32.0c, S32 8.4c, SIQ 20.5c, SVW 21.0c, WOW 60.0c. Jobs data today, ECB and BoE tonight #ausbiz




  • Ex-divided – Ama Group (AMA) 2.0c, AP Eagers (APE) 14.0c, Breville Group (BRG) 16.5c, CPT Global (CGO) 0.3c, CML Group (CGR) 0.8c, Data3 (DLT) 6.6c, Flight Centre Travel Group (FLT) 107.0c, G8 Education (GEM) 4.5c, Huon Aquaculture Group (HUO) 5.0c, Independence Group (IGO) 2.0c, Lindsay Australia (LAU) 1.0c, Laserbond (LBL) 0.4c, Metlifecare (MEQ) 5.2c, Michael Hill International (MHJ) 2.5c, McMillan Shakespeare (MMS) 40.0c, Monadelphous (MND) 32.0c, Pengana Capital Group (PCG) 6.5c, Plato Income Maximiser (PL8) 0.5c, RXP Services (RXP) 2.0c, South32 (S32) 8.4c, Smartgroup Corporation (SIQ) 20.5c, Supply Network (SNL) 8.0c, Seven Group (SVW) 21.0c, URB Investments (URB) 1.0c, Virtus Health (VRT) 12.0c, Vita Group (VTG) 4.4c, Woolworths Group (WOW) 60.0c, Western Areas (WSA) 2.0c
  • Economic data – Employment Change, Unemployment Rate. Expectations centre on a small drop in the number of employed and for the unemployment rate to tick up to 5.4%.


  • Japanese Machinery Orders, PPI
  • Chinese New Yuan Loans


  • BoE Interest Rate Decision
  • ECB Interest Rate Decision
  • US economic data – CPI, Core CPI, Treasury Budget
  • Fed speak – Governor Randal Quarles (FOMC voter), Atlanta Fed President Raphael Bostic (FOMC voter)              


Computershare (CPU) – Investor presentation in Hong Kong.


  • LendLease (LLC) – Investor presentation in Hong Kong


  • Brickworks (BWK) – Previously advised industrial action involving an indefinite strike and an indefinite overtime ban has now been withdrawn. Austral Bricks will continue its good faith negotiations in an effort to resolve the outstanding issues and attain a fair and reasonable outcome for all parties


  • APA Group (APA) The ACCC will not oppose the proposed acquisition by the CKI consortium, with FIRM approval now required. UBS has a Neutral recommendation with a target price of $10.00. The analyst suggests the decision illustrates that the proposed acquisition will not affect the current competitive dynamic on the east coast gas market.


  • Fortescue Metals Group (FMG) – Macquaire has an Outperform recommendation with a target price of $4.80. The analyst notes that FMG’s shipping rate has fallen to 160-170mtpa after a record June month of 200mtpa. They’ve cut their 1Q FY19 shipment forecasts by 11% after a soft July and August but think shares are now trading well below spot price valuation, ignoring the recent improvement in low-grade prices.


  • Myer (MYR 42c) – FY18 Results. Total sales -3.2% to $3.1bn (-2.7% on a comparable store basis); Total online sales $239.4m; EBITDA -24.6% to $149.4m; Statutory Net Loss $486m; NPAT before sig items -52.2% to $32.5m; No Final Div;
    • UBS has upgraded to a Neutral (from Sell) recommendation with a target price of 41c (from 37c). The analyst was keen to see how new CEO, John King, would do things differently, given the business has been in a turnaround mode for the past five years. While there are some key positives such as improvements in lfl sales and FY19 tracking in line with the 4Q18, they are not convinced about the ability to grow the top line. Balance sheet pressure has been alleviated for the near term and FY19-21 estimates for EBIT are revised up 6-9%
    • Credit Suisse has an Underperform recommendation with a target price of 31c (from 20c). The analyst says the result matched underwhelming expectations, while the refinancing package provides a stable funding. They note the strategy to remove unprofitable sales, while promoting an initial sales decline in FY19, should lead to improved margins. Execution is key and they question why things might be different
    • Macquarie has a Neutral recommendation with a target price of 45c (from 5c). The FY18 results were weak but broadly in line with the analyst’s expectations. They think the risk to the top-line has now increased should the new offering not resonate with the consumer. Opportunities for savings that do not affect the consumer are likely to become increasingly scarce, and they see earnings and share price risk skewed to the downside, albeit with some modest potential for corporate activity. FY19 and FY20 estimates have been cut by 14% and 4% respectively.





US EQUITIES – S&P500 +1 (+0.04%), Dow Jones +28 (+0.11%), Nasdaq -18 (-0.23%).

Main themes

  • Weaker than expected PPI (-0.1%)
  • Trade – The WSJ reported that a Mnuchin-led delegation had invited Chinese counterparts for another meeting to talk about trade.
  • Tech shares pressured by increasing regulatory pressure toward social media companies, especially Facebook (-2.37%) and Twitter (-3.7%).

EUROPEAN MARKETS – All higher. STOXX500 +0.47%, UK FTSE +0.02%, German DAX +0.22%, French CAC +0.33%.


  • The US dollar fell 0.5% to 94.81.
  • The Aussie dollar has rallied to 71.71c.

BONDS – 2 2-yr: UNCH at 2.75%, 5-yr: -1 bp to 2.86%, 10-yr: -1 bp to 2.96%, 30-yr: -2 bps to 3.11%


  • WTI crude futures rose further, up US$1.12 or 1.6% to US$70.37. EIA inventories dropped 5.3mb last week, while Russian energy minister Alexander Novak warned about the impact of US sanctions against Iran. In other oil news OPEC downgraded its expected growth in demand for 2019 to 1.41 million bpd, down 20,000-bpd
  • Iron Ore – IRESS reports iron ore was down 50c at US$69.00 a tonne. The CommSec site says China Import (Fines 62% Fe) was unchanged at US$68.35/dry ton. (CFR Tianjin port) +0.9% to $66.62
  • LME metals – Big bounce. Cu +2.36%, Ni +3.19%, Al +0.98%.


  • US economic data – August PPI -0.1% (consensus 0.2%; prior 0.0%) and Core PPI -0.1% (consensus 0.2%; prior 0.1%); Weekly MBA Mortgage Index -1.8% (prior -0.1%);  August Beige Book describes recent economic expansion as ‘moderate’, acknowledging trade-related concerns in most districts
  • Fed Speak – Fed Governor Lael Brainard discussed monetary policy and suggested gradual rate increases should continue for the next year or two. Brainard also said that an acceleration in inflation measures would require more aggressive action on rates.
  • Japanese Prime Minister Shinzo Abe met with Chinese President Xi Jinping at Russia’s Eastern Economic Forum. The two leaders agreed to deepen cooperation and work toward the first visit by a Japanese prime minister to Beijing since 2011.
  • European Central Bank – reports the ECB will lower its growth outlook while keeping inflation expectations unchanged in tonight’s policy statement
  • Italian politics – Officials have denied reports that Movimento 5 Stelle demanded EUR10bn for a citizens’ income program or the resignation of Finance Minister Giovanni Tria.
  • European data – Industrial Production -0.8% (expected -0.5%; last -0.8%) to be -0.1% year-over-year (expected 1.0%; last 2.3%); Italian July Industrial Production -1.8% (expected -0.4%; last 0.3%) to be -1.3%yoy (expected 1.4%; last 1.4%)



Life’s short. Anything could happen, and it usually does, so there is no point in sitting around thinking about all the ifs, ands and buts. Amy Winehouse, English musician born this day in 1984. Died 23 Jul 2011.


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