Author: roymorgansocial

Brazilian closures test iron restraint

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Original article by Paul Garvey
The Australian – Page: 27 : 7-Feb-19

UBS analysts are among those to have forecast an iron ore surplus in 2019. However, this is in doubt after a Brazilian court ordered Vale to put production at its Brucutu iron ore mine on hold in the wake of the tailings dam disaster at its Feijao mine. Vale has responded by declaring force majeure over its iron ore shipments. Vivek Dhar of the Commonwealth Bank says the iron ore price could potentially rise above $US100 per tonne following the production halt at Brucutu, whose annual output is 30 million tonnes.

CORPORATES
VALE SA, UBS HOLDINGS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Comyn confident about house prices

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Original article by Joyce Moullakis, Michael Roddan
The Australian – Page: 21 : 7-Feb-19

The Commonwealth Bank has posted a 2018-19 interim cash profit of $4.77bn, which is 2.1 per cent lower than previously. Mortgage and business lending rose by four per cent and five per cent respectively during the half-year, while lending margins were affected by factors such as increased competition and rising funding costs. Meanwhile, CEO Matt Comyn forecasts that growth in housing credit will slow in 2019, although he does not anticipate a sharp decline in house prices.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, RESERVE BANK OF AUSTRALIA, CORELOGIC AUSTRALIA PTY LTD, UBS HOLDINGS PTY LTD

Local banks have world-beating profits

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Original article by Michael Roddan
The Australian – Page: 21 : 7-Feb-19

Reserve Bank governor Philip Lowe has noted that at around 13 per cent, Australian banks have a much higher return on equity than many of their international peers. He was unable to provide an explanation for this, but questioned whether local banks’ higher return on equity is sustainable. Meanwhile, ratings agency Moody’s says the Hayne royal commission’s failure to recommend breaking up the four major banks supports the "strong and stable profitability" of the banking sector.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, MOODY’S INVESTORS SERVICE INCORPORATED, AUSTRALIA. PRODUCTIVITY COMMISSION, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Dollar dives as RBA keeps door open on rate cut

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Original article by David Rogers
The Australian – Page: 17 & 27 : 7-Feb-19

Reserve Bank of Australia governor Philip Lowe adopted a more dovish tone on monetary policy on 6 February. He used a National Press Club speech in Sydney to indicate that the RBA has the flexibility to reduce the cash rate if the outlook for unemployment and inflation makes such a move appropriate. The RBA had signalled in December that interest rates are more likely to rise than to fall. Lowe also said that the downturn in house prices is unlikely to affect economic growth.

CORPORATES
RESERVE BANK OF AUSTRALIA, STANDARD AND POOR’S ASX 200 INDEX, JP MORGAN AUSTRALIA LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Decline in proportion of Australians drinking alcohol

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Original article by Roy Morgan
Market Research Update – Page: Online : 7-Feb-19

New research from Roy Morgan shows that 67.9% of Australians aged 18+ consume at least one type of alcoholic drink in an average four-week period, compared with 70.1% in 2013. Wine is now consumed by 43.3% of Australians, ahead of beer (38.4%) and spirits (26.7%). Cider is now consumed by 12.3% of Australians, up from 10.3% five years ago, making it the only type to increase. Cider is now more popular than RTD (11.4%), Liqueurs (7.2%) and Fortified Wine (5.2%). Roy Morgan’s ‘Alcohol Consumption Currency Report September 2018’ is based on in-depth interviews conducted face-to-face with over 50,000 consumers per annum in their homes, including detailed questioning of over 15,000 regarding their alcoholic drinking habits.

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ROY MORGAN LIMITED

Morrison faces recall push over proposals

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Original article by Phillip Coorey
The Australian Financial Review – Page: 10 : 7-Feb-19

Opposition Leader Bill Shorten says the federal government must begin implementing the recommendations of the financial services royal commission’s final report prior to the upcoming election. Labor will seek the support of lower house crossbenchers for a motion to recall parliament for an additional two weeks in March, with a view to legislating some of commissioner Kenneth Hayne’s recommendations. Shorten says that unless action is seen to be taken quickly, the general public will believe that the misconduct exposed by the inquiry will be allowed to continue.

CORPORATES
AUSTRALIAN LABOR PARTY, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, RESERVE BANK OF AUSTRALIA

Housing bust, lower wages hit retail sales

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Original article by David Uren
The Australian – Page: 2 : 6-Feb-19

Data from the Australian Bureau of Statistics shows that retail sales fell by 0.4 per cent in December, while sales grew by just 0.1 per cent in the December quarter. The figures also show that Western Australia is the only state that did not experience a decline in retail sales during December. Gareth Aird of the Commonwealth Bank says consumer spending is being affected by the downturn in the housing market. He notes that this is particular evident in New South Wales, where house prices have fallen the most and retail sales were down 1.1 per cent in the December quarter.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, RESERVE BANK OF AUSTRALIA

Prosecutors told to push the envelope

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Original article by James Frost, Liz Main
The Australian Financial Review – Page: 10 : 6-Feb-19

The fees-for-no-service scandal has cost Australia’s four major banks and wealth manager AMP more than $2bn to date. They may also face prosecution under section 1041G of the Corporations Act, after the final report of the financial services royal commission recommended that ASIC should expand its existing probe into potential breaches of this section to include more companies. This is in addition to a recommendation by commissioner Kenneth Hayne that 24 cases of misconduct should be referred for potential civil or criminal action.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AMP LIMITED – ASX AMP, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, IOOF HOLDINGS LIMITED – ASX IFL, SUNCORP GROUP LIMITED – ASX SUN, COLONIAL FIRST STATE GROUP LIMITED

NAB bosses dig in: we’ll fix culture

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Original article by Joyce Moullakis
The Australian – Page: 1 & 5 : 6-Feb-19

Brett Le Mesurier of Shaw & Partners expects National Australia Bank CEO Andrew Thorburn to resign by the end of February, followed by chairman Ken Hendy later in the year. However, Thorburn has indicated that he will remain in his role despite attracting criticism in the final report of the financial services royal commission. He also says NAB will review and revise its strategy to improve its culture and governance.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, SHAW AND PARTNERS LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED – ASX AFI

Labor demands say on picking Aunty’s chair

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Original article by Lilly Vitorovich
The Australian – Page: 3 : 6-Feb-19

Shadow communications minister Michelle Rowland says Labor should be consulted about the appointment of a successor to Justin Milne as chairman of the ABC. She has criticised the federal government’s poor record with regard to ensuring the ABC’s independence, noting in particular its failure to respect the independent nomination panel process for appointments to the board. The ABC’s ‘Media Watch’ program has reported that Communications Minister Mitch Fifield was given a shortlist of three candidates in mid-January.

CORPORATES
AUSTRALIAN BROADCASTING CORPORATION, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF COMMUNICATIONS AND THE ARTS, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, FAIRFAX MEDIA LIMITED, TELSTRA CORPORATION LIMITED – ASX TLS, GILBERT AND TOBIN LAWYERS, CITIGROUP PTY LTD, AUSTRALIAN FOOTBALL LEAGUE