K62 Finance

Business confidence steadies in June – but for how long?

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 13-Jul-15

A Roy Morgan Business Single Source survey has found that Australian business confidence rose slightly to 114.8 in June 2015, compared with 114.7 in May. While business confidence is now at its highest level since January (114.9), it remains below the five-year average of 117.2 and well below the peak of 136.3 in October 2013. Although business confidence remained steady in June, there was some deterioration in the outlook for how businesses feel regarding their own financial position over the next 12 months, as well as increasing concern that Australia will be facing economic difficulties over the next five years.

CORPORATES
ROY MORGAN RESEARCH LIMITED

CBA, ANZ tipped to lead $28b in capital raisings

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Original article by Clancy Yeates, James Eyers
The Australian Financial Review – Page: 1 & 10 : 14-Jul-15

Shares in Australia’s four major banks fell on 13 July 2015, after the Australian Prudential Regulation Authority (APRA) indicated that they will need to lift their capital by 200 basis points. However, APRA does not think it necessary for the banks to have sufficient capital to rank them in the top quartile globally. Jarrod Martin of Credit Suisse estimates that the banks will need to raise about $A28bn of additional capital to comply with APRA’s recommendation.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CREDIT SUISSE (AUSTRALIA) LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, CLSA AUSTRALIA PTY LTD, AUSTRALIAN BANKERS’ ASSOCIATION

With US rates rising, UBS bets on a 70c dollar

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Original article by John Kehoe
The Australian Financial Review – Page: 1 & 8 : 13-Jul-15

The Australian dollar reached a low of $US0.7372 in the week ended 10 July 2015. UBS Wealth Management expects it to test the $US0.70 level by the end of 2015, with global currency strategist Katherine Klingensmith citing factors such as the slowing Australian economy, the prospect of rate rises in the US and the downturn in commodity prices. BK Asset Management’s Kathy Lien adds that further interest rate cuts are likely in Australia, which would add to bearish sentiment toward the currency.

CORPORATES
UBS WEALTH MANAGEMENT, BK ASSET MANAGEMENT, RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF ENGLAND, DELTEC INTERNATIONAL GROUP

Economists adjust bets on another rate cut

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Original article by Mark Mulligan
The Australian Financial Review – Page: 31 : 9-Jul-15

The interest rate swap market has priced in an 88 per cent chance that the Reserve Bank of Australia will reduce the cash rate by 25 basis points by the end of 2015. The market now also regards a rate cut in April 2016 as a certainty. Andrew Ticehurst of Nomura Australia expects an interest rate cut in November, while Paul Dales of Capital Economics also anticipates further monetary policy easing.

CORPORATES
RESERVE BANK OF AUSTRALIA, NOMURA AUSTRALIA LIMITED, CAPITAL ECONOMICS LIMITED

Aussie’s downward direction continues

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Original article by Mark Mulligan
The Australian Financial Review – Page: 30 : 9-Jul-15

The Australian dollar was buying $US0.7411 late in trading on 8 July 2015, after falling to $US0.7398 in overnight trading. Factors such as the debt crisis in Greece and the Chinese sharemarket’s downturn have prompted renewed support for so-called "safe haven" currencies. This has been at the expense of commodity currencies such as the Australian, New Zealand and Canadian dollars.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, RESERVE BANK OF AUSTRALIA, BK ASSET MANAGEMENT

CBA demands penalty interest

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Original article by James Eyers
The Australian Financial Review – Page: 18 : 8-Jul-15

The Federal Court is slated to rule on a proposed class action settlement concerning Willmott Forests and the Commonwealth Bank of Australia (CBA) on 23 July 2015. Some 3,500 investors have participated in the four-year class action against the fail management investment scheme operator and CBA. However, CBA has been criticised by Australian Greens senator Peter Whish-Wilson for requiring class action participants to pay penalty interest rates on their loans.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WILLMOTT FORESTS LIMITED, FEDERAL COURT OF AUSTRALIA, AUSTRALIAN GREENS, AUSTRALIAN LABOR PARTY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, GREAT SOUTHERN LIMITED

RBA likely to hold as no vote drives down Aussie

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Original article by Jacob Greber
The Australian Financial Review – Page: 8 : 7-Jul-15

The shadow board of the Reserve Bank of Australia estimates that there is a 57 per cent chance that the central bank will leave the cash rate unchanged on 7 July 2015. Shadow board chairman Timo Henckel says the economic outlook for China is a bigger issue for Australia than the debt crisis in Greece. The Australian dollar’s fall below $US0.76 in the wake of Greece’s referendum will be welcomed by the Reserve Bank.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN NATIONAL UNIVERSITY, UNIVERSITY OF MELBOURNE, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Australian dollar dips below US75c for first time since 2009

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Original article by Mark Mulligan
The Australian Financial Review – Page: 24 : 7-Jul-15

There was renewed support for "safe-haven" currencies on 6 July 2015, in response to the outcome of the referendum in Greece. The Australian dollar reached an intra-day low of $US0.7453 before rising to $US0.7504 late in trading. The debt crisis in Greece also weighed on the euro, which reached a low of $US1.09 early in Asian trading. National Australia Bank’s Ray Attrill says the euro and the Australian dollar could come under further downward pressure.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, EUROPEAN CENTRAL BANK, INTERNATIONAL MONETARY FUND, GREECE. MINISTRY OF FINANCE, BARCLAYS BANK PLC

ANZ tipped to exit Asia banks

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Original article by James Eyers
The Australian Financial Review – Page: 21 : 3-Jul-15

The ANZ Bank currently has a lower common equity tier 1 capital ratio than its peers, although at 8.7 per cent it is comfortably above the minimum requirement. However, Andrew Triggs of Deutsche Bank expects ANZ to offload some of its stakes in Asian banks in order to lift its capital ratio. He estimates that selling stakes in three of these banks – as well as the Esanda business – could boost ANZ’s capital ratio to more than 10 per cent.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, DEUTSCHE BANK AG, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, ESANDA FINANCE CORPORATION LIMITED, PT PANIN BANK, AMBANK BERHAD, BANK OF TIANJIN COMPANY LIMITED, SHANGHAI RURAL COMMERCIAL BANK, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CLYDESDALE BANK PLC, GREAT WESTERN BANK, UBS HOLDINGS PTY LTD, BLOOMBERG LP

ANZ-Roy Morgan Australian Consumer Confidence up 2% to 116.3 – highest in 18 months

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 30-Jun-15

The ANZ-Roy Morgan Consumer Confidence rating for Australia rose by two per cent to 116.3 in the week ended 28 June 2015, reaching its highest level in 18 months. This builds on the positive reaction by consumers from the Federal Budget, and puts confidence firmly on an upward trajectory. The sub-index for economic conditions in the next year rose by 5.7 per cent, while the sub-index for a "good time to buy a household item" rose by 2.1 per cent, to its highest level in two years.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ