The ASX 200 is up 17 points in mid morning trade after a mixed night. Oil ↓ 4.8%. Iron ore ↑ 4.1% and Sn ↓6.51% the high and low-lights. Gold sector best, Energy worst (surprise!). WOW to exit pokies, VOC strategy update, $A keeps ↑ despite RBA. #ausbiz


  • Australian economic data – building approvals, trade balance
  • Ex-dividend – HGL (HNG) 0.8c, Unibail-Rodamco-Westfield (URW) 30.4c
  • Chinese Caixin PMI – Services and composite


  • European data – Services and composite PMIs.
  • US economic data – ADP employment change, Balance of Trade, Services and Composite PMI


  • Woolworth (WOW) – Will combine its drinks and hospitality businesses, Endeavour Drinks and ALH Group into a single entity ‘Endeavour Group’, to be demerged or otherwise separated. The separation is expected to take place in calendar year 2020. Will allow Woolworths Group to benefit from a simplified organisational structure, a greater focus on its core food and everyday needs markets and opportunities to continue to build out the Woolworths Group retail ecosystem. Separation will also allow Endeavour Group to realise its full potential through business simplification and efficiencies with greater access to capital to pursue investment and growth, while retaining the benefits from a strong partnership with Woolworths Group. Endeavour Group includes over 1,500 BWS and Dan Murphy’s retail drinks outlets and 327 ALH hotels. ALH retail drinks outlets currently comprise approximately 35% of Woolworths Group retail drinks sales with 86 Dan Murphy’s and 512 BWS stores owned by ALH at the end of March 2019. Also includes Endeavour Drinks’ own and exclusive brands business, Pinnacle Drinks; Langton’s, a fine wine auction and retail business; Cellarmasters, a wine subscription business; and an 8.7% stake in ALE Property Group. David Marr, Woolworths Group CFO will move to the new role of Chief Operating Officer, Woolworths Group, with primary responsibility for overseeing the merger and subsequent separation of Endeavour Group. Stephen Harrison, currently Finance Director, Australian Food, will take over from David as Woolworths Group CFO, effective 1 August,
  • Vocus Communications (VOC) – Strategy Day. 3 year turnaround strategy. Reaffirmed FY19 guidance, with underlying EBITDA expected to be between $350m –$370m; Provided FY20 guidance, with underlying EBITDA expected to be between $350m –$370m, with EBITDA growth in its core Vocus Network Services business of $20m – $30m offset by a similar decline in Vocus Retail
  • CIMIC (CIM) – Has secured a five-year extension to its contract with Sydney Trains for the delivery of maintenance and logistics services for a portion of Sydney’s metropolitan passenger rail fleet which will generate revenue of approximately $630 million to UGL, replacing the $277m of revenue announced in January




US EQUITIES – S&P 500 +9 (+0.29%), Dow +69 (+0.26%), NASDAQ +18 (+0.229%).

Main themes –

  • Digesting the trade news from G20. President Trump said China trade talks have already begun, but that he doesn’t believe the US can accept a 50-50-deal

EUROPEAN MARKETS – Stronger. STOXX600 +0.37%, UK FTSE +0.82%, German DAX +0.04%, French CAC +0.16%


  • The USD is a little weaker at 96.74.
  • The Aussie dollar is stronger at US69.94.

BONDS – 3-mo: +3 bps to 2.19%, 2-yr: -2 bps to 1.77%, 3-yr: -3 bps to 1.71%, 5-yr: -4 bps to 1.75%, 10-yr: -5 bps to 1.98%, 30-yr: -6 bps to 2.50%


  • Oil – WTI futures dropped US$2.84 or 4.8% to US$56.25 despite the news of extension cuts from OPEC+. There may have been expectations for a larger cut or lower demand projections. Member countries noted that global oil demand growth for this year has fallen to 1.14 mbpd whilst non-OPEC supply is expected to grow by 2.14 mbpd,
  • Gold up 1.4% to $1,408.30 an ounce
  • Iron Ore – Commsec has iron ore up US$5 or 4.1% to US$121.20 a tonne, another record high.
  • LME metals – Mostly lower. Cu -0.74%, Ni -1.75%, Al -0.69%. Tin -6.51% the lowlight


  • ECB – IMF managing director Christine Lagarde nominated as president of the ECB, succeeding Mario Draghi.
  • USTR proposes for review an additional $4 billion of tariffs on EU goods
  • RBA cuts cash rate 25 bps yesterday to an all-time low of 1.00%; ready to cut more if necessary
  • Fed Speak – Cleveland Fed President Mester (FOMC next year) says not ready to cut rates yet
  • Oil – OPEC+ agrees to extend production reductions until March of 2020,
  • UK economic data – June Construction PMI at a 10 year low of 43.1 (expected 49.3)
  • European data – Germans May Retail Sales -0.6% (expected +0.5%)

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