{"id":83861,"date":"2019-11-27T09:04:47","date_gmt":"2019-11-26T22:04:47","guid":{"rendered":"https:\/\/www.fnarena.com\/?p=83861"},"modified":"2019-11-27T10:14:43","modified_gmt":"2019-11-26T23:14:43","slug":"the-overnight-report-softly-softly-3","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2019\/11\/27\/the-overnight-report-softly-softly-3\/","title":{"rendered":"The Overnight Report: Softly Softly"},"content":{"rendered":"\n\n\n\n\n\n\n\n\n\n\n\n\n
World Overnight<\/strong><\/span><\/td>\n<\/tr>\n
SPI Overnight (Dec)<\/strong><\/span><\/td>\n6787.00<\/strong><\/span><\/td>\n– 8.00<\/strong><\/span><\/td>\n– 0.12%<\/strong><\/span><\/td>\n<\/tr>\n
S&P ASX 200<\/strong><\/span><\/td>\n6787.50<\/strong><\/span><\/td>\n+ 56.10<\/strong><\/span><\/td>\n0.83%<\/strong><\/span><\/td>\n<\/tr>\n
S&P500<\/strong><\/span><\/td>\n3140.52<\/strong><\/span><\/td>\n+ 6.88<\/strong><\/span><\/td>\n0.22%<\/strong><\/span><\/td>\n<\/tr>\n
Nasdaq Comp<\/strong><\/span><\/td>\n8647.93<\/strong><\/span><\/td>\n+ 15.44<\/strong><\/span><\/td>\n0.18%<\/strong><\/span><\/td>\n<\/tr>\n
DJIA<\/strong><\/span><\/td>\n28121.68<\/strong><\/span><\/td>\n+ 55.21<\/strong><\/span><\/td>\n0.20%<\/strong><\/span><\/td>\n<\/tr>\n
S&P500 VIX<\/strong><\/span><\/td>\n11.54<\/strong><\/span><\/td>\n– 0.33<\/strong><\/span><\/td>\n– 2.78%<\/strong><\/span><\/td>\n<\/tr>\n
US 10-year yield<\/strong><\/span><\/td>\n1.74<\/strong><\/span><\/td>\n– 0.02<\/strong><\/span><\/td>\n– 1.36%<\/strong><\/span><\/td>\n<\/tr>\n
USD Index<\/strong><\/span><\/td>\n98.26<\/strong><\/span><\/td>\n– 0.07<\/strong><\/span><\/td>\n– 0.07%<\/strong><\/span><\/td>\n<\/tr>\n
FTSE100<\/strong><\/span><\/td>\n7403.14<\/strong><\/span><\/td>\n+ 6.85<\/strong><\/span><\/td>\n0.09%<\/strong><\/span><\/td>\n<\/tr>\n
DAX30<\/strong><\/span><\/td>\n13236.42<\/strong><\/span><\/td>\n– 10.03<\/strong><\/span><\/td>\n– 0.08%<\/strong><\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

By Greg Peel<\/p>\n

Off with their heads<\/u><\/p>\n

Straight out of the AMP playbook – no intention of resigning, public outcry, share price collapse, capitulation. Off goes the Westpac CEO with the chairman to follow. Not enough heads for some (yet) but it was worth 1.7% to the Westpac ((WBC)) share price.<\/p>\n

The bargain hunters moved in on all the banks yesterday, following this latest swoon, and the sector rose 0.8% to help underpin another solid day of comeback buying on the ASX.<\/p>\n

There will be those wondering why they sold certain healthcare stocks last week in the Westpac-triggered pullback, as healthcare (+2.0%) returns as market leader.<\/p>\n

For the second day in a row, consumer discretionary has sagged as all about have recovered. There has been no one standout stock causing the weakness, so perhaps we’re not looking forward to a merry Christmas.<\/p>\n

Everything else went up, including the bond proxies, although telcos had a breather after leading on Monday. Energy was the other primary driver, with a 1.8% gain, following the announced takeover offer for Caltex Australia ((CTX)) by a Canadian convenience store chain. The shares rose 13.4% before going into a trading halt.<\/p>\n

Coming out of a trading halt was Bank of Queensland ((BOQ)), after its capital raising, which forced a -5.8% drop. The bank is as yet unable to say what it intends to do with the money.<\/p>\n

Wealth management SaaS company Bravura Solutions ((BVS)) said the right things at its AGM and jumped 11.8% to be second best performer on the day, in an untypically quieter session for IT.<\/p>\n

The ASX200 closed a mere 17 points short of the high marked a week ago on RBA rate cut exuberance, and 58 points below the all-time high marked in July.<\/p>\n

On the subject of the RBA, last night the governor made a much anticipated speech regarding unconventional monetary policy. In it we learned the board would take the cash rate down as far as 0.25% (two more cuts) but not beyond, and certainly not negative. QE would be considered thereafter, but would only involve buying government bonds, on the secondary market, and not corporate bonds.<\/p>\n

Philip Lowe does not believe we’ll get there, but the RBA is prepared if its employment and inflation objectives do not look like being met.<\/p>\n

The resounding conclusion from economists across the globe, after the ten-year experiment, is that QE doesn’t work. (My words, not his).<\/p>\n

Final Throes<\/u><\/p>\n

President Trump pardoned the White House turkey last night. If you were watching, the turkey was left of screen.<\/p>\n

At a typically light-hearted and family-friendly ceremony, Trump took the opportunity to make a couple of visceral snipes at the Democrats and the media, and bang on about how great America is with him as president. He had also previously declared that a phase one trade deal was in its “final throes”.<\/p>\n

Among the adults, the Chinese Commerce Ministry last night revealed the Chinese premier and US trade delegates had spoken on the phone, and that the two sides had discussed “solving issues regarding each other’s core concerns, reached consensus on properly resolving related issues and agreed to maintain communication on remaining issues in consultations on the phase one deal”.<\/p>\n

Yes Minister.<\/p>\n

But Wall Street liked it all enough to inch all three major indices into further blue sky territory, despite there still being no clue about the December 15 tariffs, which are becoming an increasingly anxious topic of conversation as time ticks away.<\/p>\n

The tariffs focus on consumer goods, and would be a kick in the guts for Santa. Notably, the monthly Conference Board index of US consumer confidence showed a drop to 125.5 from 126.1 to mark the fourth straight decline.<\/p>\n

New home sales also fell, but in terms of consumer confidence in general, economists note that 125 is still an elevated number (100 neutral), and overall housing data still indicate a positive trend.<\/p>\n

Disney led the Dow last night, rising 1.3% on news the company is signing up subscribers at the rate of a million a day to its new streaming service. Apparently there’s some pretty bad weather across the US at the moment (they think they’ve<\/em> got problems), which would lead to wanting something to do indoors.<\/p>\n

Commodities<\/u><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Spot Metals,Minerals & Energy Futures<\/strong><\/span><\/td>\n<\/tr>\n
Gold (oz)<\/strong><\/span><\/td>\n1462.10<\/strong><\/span><\/td>\n+ 7.20<\/strong><\/span><\/td>\n0.49%<\/strong><\/span><\/td>\n<\/tr>\n
Silver (oz)<\/strong><\/span><\/td>\n17.07<\/strong><\/span><\/td>\n+ 0.21<\/strong><\/span><\/td>\n1.25%<\/strong><\/span><\/td>\n<\/tr>\n
Copper (lb)<\/strong><\/span><\/td>\n2.66<\/strong><\/span><\/td>\n+ 0.00<\/strong><\/span><\/td>\n0.18%<\/strong><\/span><\/td>\n<\/tr>\n
Aluminium (lb)<\/strong><\/span><\/td>\n0.79<\/strong><\/span><\/td>\n+ 0.00<\/strong><\/span><\/td>\n0.32%<\/strong><\/span><\/td>\n<\/tr>\n
Lead (lb)<\/strong><\/span><\/td>\n0.87<\/strong><\/span><\/td>\n– 0.02<\/strong><\/span><\/td>\n– 1.98%<\/strong><\/span><\/td>\n<\/tr>\n
Nickel (lb)<\/strong><\/span><\/td>\n6.55<\/strong><\/span><\/td>\n+ 0.02<\/strong><\/span><\/td>\n0.28%<\/strong><\/span><\/td>\n<\/tr>\n
Zinc (lb)<\/strong><\/span><\/td>\n1.04<\/strong><\/span><\/td>\n– 0.02<\/strong><\/span><\/td>\n– 1.73%<\/strong><\/span><\/td>\n<\/tr>\n
West Texas Crude <\/strong><\/span><\/td>\n58.36<\/strong><\/span><\/td>\n+ 0.33<\/strong><\/span><\/td>\n0.57%<\/strong><\/span><\/td>\n<\/tr>\n
Brent Crude<\/strong><\/span><\/td>\n64.26<\/strong><\/span><\/td>\n+ 0.54<\/strong><\/span><\/td>\n0.85%<\/strong><\/span><\/td>\n<\/tr>\n
Iron Ore (t) futures<\/strong><\/span><\/td>\n88.70<\/strong><\/span><\/td>\n– 1.75<\/strong><\/span><\/td>\n– 1.93%<\/strong><\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Inventories of lead have more than doubled at the Shanghai exchange in two months. Zinc has similar issues.<\/p>\n

Iron ore appears nervous about the nineties.<\/p>\n

Wall Street might be becoming more excited about a trade deal, but the US ten-year yield ticked down -2 points last night to 1.74% and the gold price rose for the first time in a while.<\/p>\n

The Aussie is 0.2% higher at US$0.6788.<\/p>\n

Today<\/u><\/p>\n

After yesterday’s surge, the SPI Overnight closed down -8 points this morning.<\/p>\n

On the day before Thanksgiving, the US will see data for durable goods and PCE inflation while the Fed Beige Book will be released and another revision of September quarter GDP will be published.<\/p>\n

Here we’ll see September quarter construction work done, ahead of our own GDP next week.<\/p>\n

Collins Foods ((CKF)) and Fisher & Paykel Healthcare ((FPH)) report earnings today. Telstra ((TLS)) and Perpetual ((PPT)) host investor days.<\/p>\n

Harvey Norman ((HVN)) is among those holding AGMs. Amcor ((AMC)) goes ex-div.<\/p>\n

The Australian share market over the past thirty days…<\/strong><\/p>\n

<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS<\/span><\/td>\n<\/tr>\n
AMP<\/td>\nAMP<\/td>\nDowngrade to Sell from Neutral<\/td>\nUBS<\/td>\n<\/tr>\n
AWC<\/td>\nALUMINA<\/td>\nDowngrade to Neutral from Outperform<\/td>\nCredit Suisse<\/td>\n<\/tr>\n
BOQ<\/td>\nBANK OF QUEENSLAND<\/td>\nUpgrade to Neutral from Sell<\/td>\nUBS<\/td>\n<\/tr>\n
CTX<\/td>\nCALTEX AUSTRALIA<\/td>\nUpgrade to Overweight from Equal-weight<\/td>\nMorgan Stanley<\/td>\n<\/tr>\n
IFL<\/td>\nIOOF HOLDINGS<\/td>\nDowngrade to Sell from Neutral<\/td>\nUBS<\/td>\n<\/tr>\n
MTS<\/td>\nMETCASH<\/td>\nUpgrade to Neutral from Sell<\/td>\nCiti<\/td>\n<\/tr>\n
<\/td>\n<\/td>\nDowngrade to Neutral from Buy<\/td>\nUBS<\/td>\n<\/tr>\n
ORG<\/td>\nORIGIN ENERGY<\/td>\nUpgrade to Add from Hold<\/td>\nMorgans<\/td>\n<\/tr>\n
SIG<\/td>\nSIGMA HEALTHCARE<\/td>\nDowngrade to Sell from Neutral<\/td>\nCiti<\/td>\n<\/tr>\n
SKI<\/td>\nSPARK INFRASTRUCTURE<\/td>\nUpgrade to Outperform from Neutral<\/td>\nMacquarie<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

For more detail go to FNArena's Australian Broker Call Report<\/a>, which is updated each morning, Mon-Fri.<\/p>\n

All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website.  Click here<\/a>. (Subscribers can access prices on the website.)<\/em><\/p>\n

(Readers should note that all commentary, observations, names and calculations are provided for informative and educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions. All views expressed are the author's and not by association FNArena's – see disclaimer on the website)<\/strong><\/em><\/p>\n

All paying members at FNArena are being reminded they can set an email alert specifically for The Overnight Report. Go to Portfolio and Alerts on the website and tick the box in front of The Overnight Report. You will receive an email alert every time a new Overnight Report has been published on the website.<\/em><\/p>\n

Find out why FNArena subscribers like the service so much: "Your Feedback (Thank You)<\/a>" – Warning this story contains unashamedly positive feedback on the service provided. www.fnarena.com<\/em><\/p>\n

FNArena is proud about its track record and past achievements: Ten Years On<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Another day, another tentative tick-up to new highs on Wall Street on more supposedly positive trade talk. Dow up 55.<\/p>\n","protected":false},"author":8,"featured_media":83866,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[84],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/83861"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=83861"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/83861\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media\/83866"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=83861"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=83861"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=83861"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}