K: Financial and Insurance Services

M&A outlook is optimistic

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 18 : 10-Jun-15

Data from Dealogic shows that some $US59.3bn ($A77.6bn) worth of mergers and acquisitions have been announced in Australia so far in 2015. This includes $US15.1bn worth of offshore deals by local companies. Anthony Sweetman of UBS is upbeat about the outlook for M&A activity in the second half of 2015, while Michael Barker of law firm King & Wood Mallesons also anticipates a bullish M&A market in the second half.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, UBS HOLDINGS PTY LTD, KING AND WOOD MALLESONS, TOLL HOLDINGS LIMITED, JAPAN POST COMPANY LIMITED, INDEPENDENCE GROUP NL – ASX IGO, SIRIUS RESOURCES NL – ASX SIR, EVOLUTION MINING LIMITED – ASX EVN, BARRICK GOLD CORPORATION, GE CAPITAL AUSTRALIA, ESANDA FINANCE CORPORATION LIMITED, BANK OF AMERICA AUSTRALIA LIMITED, MERRILL LYNCH (AUSTRALIA) PTY LTD, MACQUARIE CAPITAL PTY LTD, GRANT SAMUEL AND ASSOCIATES PTY LTD, MEDIBANK PRIVATE LIMITED – ASX MPL

Business confidence in May boosted by budget – but remains fragile

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 9-Jun-15

A Roy Morgan Business Single Source survey has found that Australian business confidence rose by 9.1 per cent to 114.7 in May 2015. This is the highest level since January 2015 (114.9), but business confidence remains below the five-year average of 117.3 and the peak of 136.3 in October 2013. The increase in business confidence in May occurred across all components of the index, but stemmed mainly from an increase in the proportion of businesses believing that Australia will experience good economic conditions over the next 12 months.

CORPORATES
ROY MORGAN RESEARCH LIMITED

ASX warns on open clearing

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Original article by Michael Smith
The Australian Financial Review – Page: 20 : 9-Jun-15

The Australian Government is likely to make a decision on the future of ASX Limited’s monopoly on the clearing of cash equities by July 2015. ASX CEO Elmer Funke Kupper has warned that allowing competition in cash equities clearing would make it more difficult to manage defaults by stockbrokers. He notes that rival clearing houses would have to close a firm’s options trading positions immediately rather than pursuing alternatives that are open to the ASX.

CORPORATES
ASX LIMITED – ASX ASX, BBY LIMITED, CHI-X AUSTRALIA PTY LTD, COUNCIL OF FINANCIAL REGULATORS, RESERVE BANK OF AUSTRALIA, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA. DEPT OF THE TREASURY

‘Impact investors’ want tax breaks

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Original article by Sally Rose
The Australian Financial Review – Page: 20 : 9-Jun-15

STREAT provides training for about 125 disadvantaged people in Victoria each year. The social enterprise will be able to train 250 people each year when its new hospitality training facility in Melbourne is completed in around 18 months’ time. Social Ventures Australia, which helped to negotiate an $A2.5m loan for STREAT, has urged the Australian Government’s tax inquiry to provide tax breaks for so-called social impact investments.

CORPORATES
STREAT LIMITED, SOCIAL VENTURES AUSTRALIA LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Trade engagement push with Japan

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Original article by James Eyers
The Australian Financial Review – Page: 21 : 9-Jun-15

Australia’s Assistant Treasurer Josh Frydenberg is visiting Japan with a delegation of financial services industry executives. Frydenberg will address a business lunch on 9 June 2015, and will argue that financial services groups in both nations should capitalise on the Japan-Australia Economic Partnership Agreement. He says the financial services industries in both countries can benefit from each other’s expertise.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, FINANCIAL SERVICES COUNCIL, PERPETUAL LIMITED – ASX PPT, MACQUARIE INVESTMENT MANAGEMENT LIMITED, MLC LIMITED, JAPAN. OFFICE OF THE PRIME MINISTER, BANK OF JAPAN, NIKKO ASSET MANAGEMENT GROUP, TYNDALL INVESTMENT MANAGEMENT LIMITED, THE DAI-ICHI MUTUAL LIFE INSURANCE COMPANY LIMITED, TAL LIMITED, MITSUBISHI UFJ FINANCIAL GROUP INCORPORATED, AMP CAPITAL INVESTORS LIMITED, NIPPON LIFE INSURANCE COMPANY LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Citi finds value in 2015’s star stocks

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Original article by Vesna Poljak
The Australian Financial Review – Page: 23 : 5-Jun-15

Australia’s benchmark S&P/ASX 200 is currently trading on a price-earnings ratio of 16.5 times earnings forecasts. Citigroup has identified six stocks that continue to offer good value for investors: Macquarie Group, Harvey Norman, Lend Lease Group, Mirvac Group, IOOF Holdings and Incitec Pivot. Citigroup also nominates Woolworths, Metcash, QBE Insurance Group, Fletcher Building and Orica as stocks that could stage rebounds.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, CITIGROUP PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN, LEND LEASE GROUP LIMITED – ASX LLC, MIRVAC GROUP – ASX MGR, IOOF HOLDINGS LIMITED – ASX IFL, INCITEC PIVOT LIMITED – ASX IPL, WOOLWORTHS LIMITED – ASX WOW, METCASH LIMITED – ASX MTS, QBE INSURANCE GROUP LIMITED – ASX QBE, FLETCHER BUILDING LIMITED – ASX FBU, ORICA LIMITED – ASX ORI, WESTPAC BANKING CORPORATION – ASX WBC, AMCOR LIMITED – ASX AMC, WESFARMERS LIMITED – ASX WES, APA GROUP – ASX APA, ASX LIMITED – ASX ASX, COMPUTERSHARE LIMITED – ASX CPU, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, BANK OF QUEENSLAND LIMITED – ASX BOQ, ANSELL LIMITED – ASX ANN, PRIMARY HEALTH CARE LIMITED – ASX PRY

Default fund choice aired

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Original article by Sally Rose
The Australian Financial Review – Page: 21 : 4-Jun-15

The financial system inquiry concluded that Australian superannuation fees are too high, costing members about $A20bn a year. Inquiry chairman David Murray has told a conference of the need for increased competition in the sector in order to reduce fees, while Assistant Treasurer Josh Frydenberg has flagged possible changes to the default super fund regime to boost competition. However, industry and retail super fund executives disagree on whether such reforms will result in lower fees.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, COLONIAL FIRST STATE GROUP LIMITED, INDUSTRY FUND SERVICES PTY LTD, RICE WARNER ACTUARIES PTY LTD, GRATTAN INSTITUTE, COMMITTEE FOR SUSTAINABLE RETIREMENT INCOMES, ERNST AND YOUNG, AMP LIMITED – ASX AMP, CHALLENGER LIMITED – ASX CGF, DIMENSIONAL FUND ADVISORS

Soaring small caps perturb strategists

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Original article by Rose Powell, Patrick Commins
The Australian Financial Review – Page: 25 : 3-Jun-15

Australian-listed small-capitalisation industrial stocks have rallied since March 2015, while industrials in the S&P/ASX 50 have generally underperformed. Investor support for small-caps has been driven by factors such as an upturn in the sector’s return on equity (ROE), as well as a corresponding decline in ROE for larger stocks. Meanwhile, Matthew Ross of Goldman Sachs says valuations in the small-cap sector may have become stretched.

CORPORATES
GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, STANDARD AND POOR’S ASX 50 INDEX, STANDARD AND POOR’S ASX 200 INDEX, RESERVE BANK OF AUSTRALIA, IPROPERTY GROUP LIMITED – ASX IPP, NEXTDC LIMITED – ASX NXT, DOMINO’S PIZZA ENTERPRISES LIMITED – ASX DMP, TECHNOLOGY ONE LIMITED – ASX TNE, CORPORATE TRAVEL MANAGEMENT LIMITED – ASX CTD, INFOMEDIA LIMITED – ASX IFM, SIRTEX MEDICAL LIMITED – ASX SRX, ALTIUM LIMITED – ASX ALU, MANTRA GROUP LIMITED – ASX MTR, TFS CORPORATION LIMITED – ASX TFC

Buy shares, not bonds, says Morgan Stanley

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Original article by Rose Powell
The Australian Financial Review – Page: 23 : 2-Jun-15

Morgan Stanley forecasts that Australian shares will deliver a return of 5.8 per cent over the next 12 months and 10.3 per cent in the longer-term. Meanwhile, the firm expects international shares to achieve a short-term return of 15.4 per cent and 10.3 per cent in the long-term. However, Morgan Stanley is bearish about the outlook for Australian bonds and global sovereign bonds.

CORPORATES
MORGAN STANLEY AUSTRALIA LIMITED, AMP CAPITAL INVESTORS LIMITED, UNITED STATES. FEDERAL RESERVE BOARD, PERPETUAL LIMITED – ASX PPT

Grim GDP figures may mean further rate cuts

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Original article by Vesna Poljak
The Australian Financial Review – Page: 18 : 2-Jun-15

The general expectation of economists is that Australia recorded GDP growth of about 0.6 per cent in the March 2015 quarter. However, Citigroup has forecast real GDP growth of just 0.5 per cent, while Damien Boey of Credit Suisse says there is the potential for GDP on a nominal basis to contract in the first two quarters of calendar 2015. Boey says the GDP outlook may prompt the Reserve Bank to further reduce the cash rate in the near-term.

CORPORATES
CITIGROUP PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, FEDERAL RESERVE BANK OF ATLANTA