K: Financial and Insurance Services

Australian Roy Morgan Business Confidence still positive in November but showing signs of "cooling off"

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 8-Dec-15

A Roy Morgan Business Single Source survey has found that Australian business confidence fell by 0.6 points to 118.7 in November 2015, but remained above the five-year average of 116.9. This decline in confidence was probably to be expected, given the big increase in the two months following Malcolm Turnbull becoming Prime Minister, which saw business confidence increase by 16.3 per cent. The small drop in business confidence in November was a result of only marginal declines in both the five-year economic outlook and the view that the next 12 months would be a good time to invest in growing the business. However, both of these measures remain at positive levels and are above the five-year average.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

No slow down in 2016 for hot M&A volumes

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 17 : 9-Dec-15

Data from Dealogic shows that mergers and acquisitions activity involving Australian companies has risen by 80 per cent so far in 2015, to $US124.9bn ($A170.9m). This includes 23 deals worth $US1bn ($A1.4bn). Alex Cartel of Deutsche Bank forecasts further growth in M&A activity in 2016, while Gareth Cope of Rothschild Australia says the country remains highly attractive to offshore investors. Meanwhile, equity capital market issuance has reached its highest level since 2009, at more than $US42bn.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, DEUTSCHE BANK AG, NM ROTHSCHILD AUSTRALIA HOLDINGS PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG, UBS HOLDINGS PTY LTD, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD, WOODSIDE PETROLEUM LIMITED – ASX WPL, OIL SEARCH LIMITED – ASX OSH, SANTOS LIMITED – ASX STO, SCEPTER PARTNERS, BROADSPECTRUM LIMITED – ASX BRS, TRANSGRID, VEDA GROUP LIMITED – ASX VED, EQUIFAX INCORPORATED, ASCIANO LIMITED – ASX AIO, CALTEX AUSTRALIA LIMITED – ASX CTX, CHEVRON CORPORATION, HEALTHSCOPE LIMITED – ASX HSO, TPG CAPITAL LP, THE CARLYLE GROUP

Listed companies too afraid to provide guidance, study says

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 1 & 11 : 8-Dec-15

McGrathNicol has released a report which shows that just 49 per cent of the 104 Australian-listed companies it surveyed have released earnings guidance in 2015, compared with 57 per cent in 2014. The survey also found that the number of companies that met or exceeded their earnings guidance fell from 69 per cent in 2014 to 64 per cent. Factors such as concern about class actions and challenging market conditions in some sectors have contributed to companies’ reluctance to release earnings guidance.

CORPORATES
McGRATH NICOL AND PARTNERS SERVICES PTY LTD, ASX LIMITED – ASX ASX, BROADSPECTRUM LIMITED – ASX BRS, JB HI-FI LIMITED – ASX JBH, PACIFIC BRANDS LIMITED – ASX PBG

Insurance jobs under threat from technology

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Original article by Ruth Liew
The Australian Financial Review – Page: 25 : 8-Dec-15

Suncorp Group executive Darren O’Connell notes that the growing use of automation in the insurance sector has resulted in the elimination of entry-level jobs in the underwriting industry. He says this will result in a dearth of underwriters with expertise across the industry as older staff retire and their skills and knowledge are lost. O’Connell argues in a research paper that technology can never completely replace people in the underwriting industry, and insurers should reconsider their recruitment procedures.

CORPORATES
SUNCORP GROUP LIMITED – ASX SUN, SWISS RE AUSTRALIA LIMITED, IBM CORPORATION

Target super literacy, says Deloitte

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Original article by Sally Rose
The Australian Financial Review – Page: 17 : 4-Dec-15

Russell Mason of Deloitte notes that some trustees of superannuation funds voluntarily undertake a course for financial product advisers, but he argues that it should be compulsory for all of them. The issue of governance standards in the sector is again under scrutiny after cross-bench senators rejected the Australian Government’s proposal for one-third of all super funds’ directors be independent. Former Reserve Bank governor Bernie Fraser will review governance standards in the industry.

CORPORATES
DELOITTE TOUCHE TOHMATSU LIMITED, RESERVE BANK OF AUSTRALIA, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIAN INSTITUTE OF SUPERANNUATION TRUSTEES, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIAN INSTITUTE OF COMPANY DIRECTORS, THE ASSOCIATION OF SUPERANNUATION FUNDS OF AUSTRALIA LIMITED, FINANCIAL SERVICES COUNCIL

Credit Suisse picks 2016 stocks, predicts ASX at 6000 end next year

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Original article by Stephen Cauchi
The Australian Financial Review – Page: 29 : 3-Dec-15

Credit Suisse is upbeat about the Australian sharemarket in 2016, forecasting that the benchmark S&P/ASX 200 Index will rise to the 6,000-point level by the end of the calendar year. The firm expects more companies to pursue strategies such as mergers/acquisitions and cost reductions. It has identified Macquarie Group, Nine Entertainment Company, AGL Energy, Carsales.com, Aristocrat Leisure and Lend Lease as stocks that should perform well in 2016.

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, STANDARD AND POOR’S ASX 200 INDEX, MACQUARIE GROUP LIMITED – ASX MQG, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, AGL ENERGY LIMITED – ASX AGL, CARSALES.COM LIMITED – ASX CAR, ARISTOCRAT LEISURE LIMITED – ASX ALL, LEND LEASE GROUP LIMITED – ASX LLC, WOOLWORTHS LIMITED – ASX WOW, BRAMBLES LIMITED – ASX BXB, CROWN RESORTS LIMITED – ASX CWN, MEDIBANK PRIVATE LIMITED – ASX MPL, HEALTHSCOPE LIMITED – ASX HSO

ANZ-Roy Morgan Australian Consumer Confidence deteriorates – down to 112.8

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 1-Dec-15

The ANZ-Roy Morgan Consumer Confidence rating for Australia fell by 1.5 per cent to 112.8 in the week ended 29 November 2015, taking the cumulative fall over the last three weeks to 3.3 per cent. The four-week moving average remains elevated; however, it is now trending downwards – suggesting that confidence has turned. The sub-index for consumers’ finances compared with a year ago fell by 5.1 per cent, while the sub-index for economic conditions in the next 12 months fell by 3.4 per cent. Roy Morgan Research executive chairman Gary Morgan says the continuing war in Syria and Iraq, and the threat of terrorism around the world, is having a clearly negative impact on Consumer Confidence and Australia’s economic fortunes. He adds that the best defence Australia can have against unrest overseas is for a strong economy in Australia – and this is why Prime Minister Malcolm Turnbull must be prepared to make the tough decisions now to give Australia the best chance of strong economic growth, and continuing jobs growth, over the years ahead.

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

Do the numbers add up for a Santa rally?

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Original article by Philip Baker
The Australian Financial Review – Page: 32 : 2-Dec-15

Despite a strong performance by the S&P/ASX 200 on 1 December 2015, the prospects for the Australian sharemarket experiencing a "Santa rally" remain uncertain. The local market has risen on 10 consecutive trading days just twice since the inception of the current benchmark index, and it has not recorded a nine-day winning run since 2004. Historical analysis shows that the local market gains an average of 2.03 per cent in the month of December.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, STANDARD AND POOR’S 500 INDEX, BLOOMBERG LP

Super industry told to sort out ‘fit and proper’

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Original article by Sally Rose
The Australian Financial Review – Page: 17 : 1-Dec-15

The Australian Government is right to insist on higher governance standards among superannuation funds. JPMorgan global pensions executive Benjie Fraser says it is vital to ensure that only "fit and proper" persons hold managerial and board positions within a super fund. The Government wants one third of super funds’ boards to be independent directors.

CORPORATES
JP MORGAN AUSTRALIA LIMITED, TELSTRA SUPERANNUATION SCHEME, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Westpac under fire over pay

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Original article by Adele Ferguson
The Australian Financial Review – Page: 1 : 30-Nov-15

Westpac has refuted claims by Ownership Matters that its executive bonuses for 2013-14 and 2014-15 were inflated by a decision to exclude a software write-off from its cash earnings. Ownership Matters argues that Westpac’s ex-CEO Gail Kelly and other senior executives would not have received bonuses if the $A354m software write-down had been included in the bank’s cash earnings. The firm has advised Westpac shareholders to vote against the bank’s remuneration report at its 2015 annual meeting.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, OWNERSHIP MATTERS PTY LTD, DEUTSCHE BANK AG