The ASX 200 is down 14 points in mid-morning trade on weaker o/night leads. Banks boosted by APRA floor drop. IT and consumer hit by delayed (broken) tax promises. JHX, TNE and ALQ results, SVW update and big RBA day.#ausbiz



  • RBA Meeting Minutes 
  • Speech by Philip Lowe, Governor – The Economic Outlook and Monetary Policy – at the Economic Society of Australia (QLD) Business Lunch, Brisbane
  • Earnings – ALS Ltd (ALQ), James Hardie (JHX), OFX, TechnologyOne (TNE)
  • Ex-dividend – AusNet Services (AST) 4.9c, United Overseas Australia (UOS) 2.0c


  • UK – CBI Industrial Trends Orders
  • European data – Consumer Confidence Flash
  • US economic data – Existing Home Sales
  • Fed Speak – Chairman Jay Powell; Chicago Fed President (FOMC voter) Charles Evans; Boston Fed President (FOMC voter) Eric Rosengren


  • James Hardie (JHX) – Adjusted net profit +3% to US$300.5m (US$73.8m or -9% for the 4Q) Sales revenue up 22% to US$2.5066bn for the year (or +19% over the Q). 2H dividend of 26c. Outlook – Expect to see modest growth in the US housing market in fiscal year 2020. The single family new construction market and repair and remodel market growth rates in fiscal year 2020 are expected to grow, albeit at a growth rate lower than that in fiscal year 2019. Expect NA Fiber Cement EBIT margin to be in the top half of our range of 20-25% for fiscal year 2020. This expectation is based upon the Company continuing to improve operating performance in our plants, improved net average sales price and mix, continued inflation for input costs and modest underlying housing growth. Aust – anticipated that our addressable underlying market will decrease in fiscal year 2020. Net sales from our Australian business are expected to continue to trend above the average growth of the domestic repair and remodel and single family detached housing markets in the eastern states ofAustralia. We expect our Europe Building Product segment to achieve year on year net sales and EBIT margin growth.
  • TechnologyOne (TNE) – Net Profit Before Tax of $24.5m, up 130%; Revenue of $129.3m, up 5%; Expenses of $104.8m, down 7%; SaaS Fees Recognised of $37.5m, up 42%; SaaS Annual Contract Value (ACV) of $85.8m, up 45%; Operating Cashflow of $7.8m, up 100+%; Cash and Cash Equivalents of $68.2m, up 19%; Dividend of 3.15cps, up 10%; R&D expenditure (before capitalisation) of $27.8m, up 7%, which is 22% of revenue. Guidance – “TechnologyOne is on track to deliver continuing strong growth with net profit before tax over the full year of $71.6m to $76.3m.”
  • ALS (ALQ) – FY Results. Underlying profit growth +27.3%, ALS FY2019 Underlying NPAT exceeds guidance at $181million; Final dividend 11.5 cents per share, up 27.8%; EPS is 37.1 cents per share, up 31%; Revenue from continuing operations of $1.665b up 15.1%; Life Science margin up by +110bps to 15%; Superior EBITDA margin to global peers in TIC sector, 20.9%; Strong balance sheet, capital management platform to drive future growth. No guidance (provided at AGM in July.) Outlook – In the absence of any prolonged trade uncertainty, the underlying global economic conditions in which ALS business streams operate continue to remain stable.
  • Seven West Media (SVW) – Expects underlying Group EBIT for FY19 of $210-$220m versus $235.6m pcp. FY19 Group net cost reduction will be at the top end of the $30-$40m range provided at the 2019 Half Year Results in February. Revenue share gains (41.3% share of the metro FTA market and 42.5% share of BVOD market in April) but soft maket conditions and election uncertainty. Seven Studios will achieve strong EBIT growth and 7Plus will grow revenue over 40% this financial year. SWM remains focused on improving balance sheet flexibility and will reduce net debt by approximately $75 million in FY19.




US EQUITIES – S&P 500 -19 (-0.67%), Dow -84 (-0.33%), NASDAQ -114 (-1.46%).

Main themes –

  • Trade uncertainty
  • Huawei fallout – Several US companies including Alphabet’s Google have suspended business operations with Huawei Technologies. Intel and Qualcomm have stopped selling components and licensing software to Huawei. It follows the addition of Huawei to a list that required US companies get a license to do business
  • Lumentum Holdings (-4.1%) cut 4Q guidance to reflect lost business and the possibility that other semiconductor companies could also lower their guidance, and the possibility that China could retaliate against US tech companies, weighed heavily on the Philadelphia Semiconductor Index (-4.0%) and the S&P 500 information technology sector (-1.8%).
  • Apple (-3.13%) fell after an HSBC analyst cut its price target on the tech giant.

EUROPEAN MARKETS – All lower. STOXX600 -1.06%, UK FTSE -0.51%, German DAX -1.61%, French CAC -1.46%


  • The USD is a touch lower at 97.95.
  • The Aussie dollar has firmed to US69.07

BONDS – 2-yr: +1 bp to 2.22%, 3-yr: +2 bps to 2.17%, 5-yr: +3 bps to 2.21%, 10-yr: +2 bps to 2.42%, 30-yr: +1 bp to 2.84%


  • Oil – WTI futures were up US34c to US$63.10 a barrel after OPEC and other major producers said production cuts (1.2mbpd) are likely to remain. Rising tension in the Middle East also supported prices.
  • Gold – Futures settled US$1.50 higher at US$1,282.90 an ounce
  • Iron Ore – IRESS shows iron ore up US$3.00 to US$103 a tonne. CommSec has iron ore unchanged at US$100.40 a tonne.
  • LME metals – Generally weaker. Cu -0.41%, Ni -0.29%, Al -2.13% the worst


  • Japanese data yesterday much better than expected


  • Italian economy – Deputy Prime Minister Matteo Salvini is lobbying for tax cuts to spur growth and lower the country’s debt burden.


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