K64 Auxiliary Finance and Insurance Services

Miners ride high into new profit season

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Original article by Vesna Poljak
The Australian Financial Review – Page: 26 : 29-Jan-18

Data from Deutsche Bank shows that Australian-listed companies are forecast to achieve earnings-per-share growth of seven per cent in 2017-18. Kogan, Noni B and Lovisa are among the companies that have upgraded their earnings forecasts ahead of the February 2018 reporting season. The outlook for resources stock in particular is good, with Macquarie Group recently upgrading its share price targets for BHP Billiton, Rio Tinto and South32 on the strength of its bullish price forecasts for commodities such as iron ore and coking coal in 2018.

CORPORATES
DEUTSCHE BANK AG, KOGAN.COM LIMITED – ASX KGN, NONI B LIMITED – ASX NBL, LOVISA HOLDINGS LIMITED – ASX LOV, MACQUARIE GROUP LIMITED – ASX MQG, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, SOUTH32 LIMITED – ASX S32, PINNACLE INVESTMENT MANAGEMENT GROUP LIMITED – ASX PNI, RETAIL FOOD GROUP LIMITED – ASX RFG, AUSTRALIAN PHARMACEUTICAL INDUSTRIES LIMITED – ASX API, McGRATH LIMITED – ASX MEA, QBE INSURANCE GROUP LIMITED – ASX QBE, PRICELINE PHARMACY, ORIGIN ASSET MANAGEMENT, WESTPAC BANKING CORPORATION – ASX WBC, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, MORGAN STANLEY AUSTRALIA LIMITED

AFIC left behind on rising resources

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Original article by Michael Roddan
The Australian – Page: 18 : 23-Jan-18

The Australian Foundation Investment Company has posted a 2017-18 interim profit of $A136.4m, which is 15.6 per higher than previously. Its investment portfolio achieved a return of 6.9 per cent for the half-year, while the benchmark S&P/ASX 200 gained 8.4 per cent. AFIC failed to benefit from a rally in small and mid-cap resources stocks, as its focus in the sector is on large-cap stocks. AFIC CEO Mark Freeman notes that elevated share price means it is hard to find stocks that are fairly valued at present.

CORPORATES
AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED – ASX AFI, STANDARD AND POOR’S ASX 200 INDEX, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, WESTPAC BANKING CORPORATION – ASX WBC, WESFARMERS LIMITED – ASX WES, TREASURY WINE ESTATES LIMITED – ASX TWE, TRANSURBAN GROUP LIMITED – ASX TCL, MACQUARIE GROUP LIMITED – ASX MQG, WESTFIELD CORPORATION – ASX WFD, CSL LIMITED – ASX CSL, INCITEC PIVOT LIMITED – ASX IPL, COCA-COLA AMATIL LIMITED – ASX CCL, QBE INSURANCE GROUP LIMITED – ASX QBE

Cyclical stocks back in play as bulls charge on

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Original article by David Rogers
The Australian – Page: 22 : 19-Jan-18

Analysis by Hasan Tevfik of Credit Suisse shows that stocks with the lowest volatility have traded at an average price-earnings premium of nearly 10 per cent over the last decade. In contrast, stocks with the highest volatility have traded on an average PE discount of nearly 20 per cent. Tevfik says investors should rebalance their portfolios in favour of higher-volatility cyclical stocks rather than so-called bond proxies. Stocks he favours include BHP Billiton, Whitehaven Coal, Qantas and Harvey Norman.

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, BHP BILLITON LIMITED – ASX BHP, WHITEHAVEN COAL LIMITED – ASX WHC, QANTAS AIRWAYS LIMITED – ASX QAN, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN, BLUESCOPE STEEL LIMITED – ASX BSL, ORIGIN ENERGY LIMITED – ASX ORG, STOCKLAND – ASX SGP, MAGELLAN FINANCIAL GROUP LIMITED – ASX MFG, STANDARD AND POOR’S 500 INDEX, CHICAGO BOARD OPTIONS EXCHANGE VOLATILITY INDEX, STANDARD AND POOR’S ASX 200 INDEX

Stumble may be start of bigger global pullback

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Original article by David Rogers
The Australian – Page: 18 : 11-Jan-18

The S&P/ASX 200 recorded its largest fall in six weeks on 10 January, after posting strong gains over the last three months. Factors such as a rise in US 10-year bond yields to a 10-month high and a slight reduction in the Bank of Japan’s quantitative easing program weighed on the Australian market. Meanwhile, tax-loss selling is a major risk for the US market in January, as the Trump Administration’s capital gains tax reforms now allow US investors to defer tax liabilities until April 2019.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, BANK OF JAPAN, STANDARD AND POOR’S 500 INDEX, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, BELL POTTER SECURITIES LIMITED, JP MORGAN AUSTRALIA LIMITED, WOODSIDE PETROLEUM LIMITED – ASX WPL, ORIGIN ENERGY LIMITED – ASX ORG, BHP BILLITON LIMITED – ASX BHP, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

PayPal faces boycott over lack of services in Palestine

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Original article by Andrew Tillett
The Australian Financial Review – Page: Online : 3-Jan-18

The Australian Palestinian Advocacy Network (APAN) has urged Australians to boycott online payments provider Paypal. It accuses Paypal of engaging in "online apartheid" by providing its services to Israelis but not to Palestinians living in Gaza and the West Bank, even though they use the same currency, the Israeli shekel. PayPal states its lack of service to Palestine is not politically motivated, but that there are certain compliance and regulatory issues that need to be addressed before it can provide its service to Palestinians.

CORPORATES
AUSTRALIAN PALESTINIAN ADVOCACY NETWORK, PAYPAL INCORPORATED, ACTION AID

Christmas rally shows no sign of slowdown

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Original article by David Rogers
The Australian – Page: 18 : 21-Dec-17

The latest survey of fund managers by Bank of America Merrill Lynch suggests that the global sharemarket rally may continue into 2018. The December survey shows that the average cash balance of respondents has increased from 4.4 per cent to 4.7 per cent, compared with the average over the last decade of 4.5 per cent. The survey also found that 54 per cent of the 203 respondents expect global economic growth to be above trend over the next year, while inflation is expected to be below trend.

CORPORATES
BANK OF AMERICA CORPORATION, MERRILL LYNCH AND COMPANY INCORPORATED, UNITED STATES. FEDERAL RESERVE BOARD, EUROPEAN CENTRAL BANK, FACEBOOK INCORPORATED, APPLE INCORPORATED, AMAZON.COM INCORPORATED, GOOGLE INCORPORATED, ALPHABET INCORPORATED, BAIDU.COM INCORPORATED, ALIBABA.COM CORPORATION, TENCENT HOLDINGS LIMITED, BELL POTTER SECURITIES LIMITED

Mortgage brokers added to banking inquiry purview

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Original article by James Frost
The Australian Financial Review – Page: 17 : 20-Dec-17

Commissioner Kenneth Hayne has broadened the banking royal commission’s terms of reference to include the $A344 billion mortgage broking sector. Many had been surprised that the sector was not included in the royal commission’s original terms of reference, given that over 50 per cent of all mortgages are generated via mortgage brokers. Mortgage & Finance Association of Australia CEO Mike Felton contends that the sector’s professional standards are improving, while he notes that it has been the subject of two major reviews in the last 18 months.

CORPORATES
MORTGAGE AND FINANCE ASSOCIATION OF AUSTRALIA, MORTGAGE CHOICE LIMITED – ASX MOC, AUSTRALIA. ATTORNEY-GENERAL’S DEPT, AUSTRALIA. DEPT OF THE TREASURY

Late splurge sparks hopes for 2018 M&A

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 15 & 20 : 18-Dec-17

Data from Dealogic shows that $US86.9 billion worth of mergers and acquisitions had been announced in Australia as at 15 December 2017, which is 3.8 per cent lower than at the same time in 2016. Likewise, the value of announced M&A deals globally has fallen by 4.6 per cent to $US3.5 trillion. However, Nick Sims of Goldman Sachs notes that there has been an upturn in M&A activity in Australia and globally during the December quarter, which is expected to continue in 2018. Meanwhile, the total value of offshore acquisitions made by Australian companies has risen by 75 per cent so far in 2017, to $US26.3 billion.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, GOLDMAN SACHS AUSTRALIA PTY LTD, MACQUARIE CAPITAL PTY LTD, WESTFIELD CORPORATION – ASX WFD, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AWE LIMITED – ASX AWE, INTEGRAL DIAGNOSTICS LIMITED – ASX IDX, SANTOS LIMITED – ASX STO, HARBOUR ENERGY LIMITED, 21ST CENTURY FOX INCORPORATED, WALT DISNEY COMPANY, CVS HEALTH CORPORATION, AETNA INSURANCE COMPANY, HERBERT SMITH FREEHILLS PTY LTD, NUFARM LIMITED – ASX NUF, LINK ADMINISTRATION HOLDINGS LIMITED – ASX LNK

ASX will share blockchain system savings

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Original article by James Eyers
The Australian Financial Review – Page: 15 : 8-Dec-17

Stock exchanger operator ASX Limited expects to achieve significant cost savings by phasing out its CHESS settlement and clearing system for equities in favour of one based on blockchain technology. Financial market experts say the shift to distributed ledger technology developed by Digital Asset Holdings will increase the sharemarket’s transparency, and have welcomed the ASX’s announcement that some its cost savings will be passed on to market participants. The ASX could potentially deploy blockchain technology for other markets.

CORPORATES
ASX LIMITED – ASX ASX, DIGITAL ASSET HOLDINGS LLC, STOCKBROKERS AND FINANCIAL ADVISERS ASSOCIATION LIMITED, NORTHERN TRUST COMPANY, DIGITALX LIMITED – ASX DCC, EUROZ SECURITIES LIMITED, KPMG AUSTRALIA PTY LTD, NCC GROUP, AUSTRALIA. DEPT OF THE TREASURY, JP MORGAN AND COMPANY INCORPORATED

Bulls edge ahead in the battle for coming year

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Original article by David Rogers
The Australian – Page: 26 : 8-Dec-17

Investment banks are generally upbeat about the outlook for Australia’s benchmark S&P/ASX 200 in 2018. Credit Suisse and Macquarie Group both expect it to end the year at 6,500 points, while Citigroup has a year-end target of 6,400 point. In contrast, Morgan Stanley expects the index to end 2018 at just 5,800 points. Meanwhile, Hasan Tevfik of Credit Suisse believes that factors such as the potential for fiscal stimulus, a sharp rise in bond yields and rising capital investment to influence the direction of the sharemarket in 2018.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, CREDIT SUISSE (AUSTRALIA) LIMITED, MACQUARIE GROUP LIMITED – ASX MQG, CITIGROUP PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED, GOLDMAN SACHS AUSTRALIA PTY LTD, UBS HOLDINGS PTY LTD, DEUTSCHE BANK AG, BLOOMBERG LP, AUSTRALIAN LABOR PARTY, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT, UNITED STATES. FEDERAL RESERVE BOARD, EUROPEAN CENTRAL BANK