K: Financial and Insurance Services

Franking credits entice as currency plays dry up

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Original article by Simon Evans
The Australian Financial Review – Page: 32 : 26-Feb-15

The Australian dollar was trading at about $US0.78 on 25 February 2015, compared with $US0.90 in September 2014. The weaker currency will be a boon to investors who hold shares in Australian-listed stocks that report their financial results and pay dividends in the US dollar, such as CSL, BHP Billiton and Woodside Petroleum. Matthew Ross of Goldman Sachs does not expect the currency to fall much further, and says franking credits will become a bigger issue for investors than the impact of the dollar on dividends

CORPORATES
CSL LIMITED – ASX CSL, BHP BILLITON LIMITED – ASX BHP, WOODSIDE PETROLEUM LIMITED – ASX WPL, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, RIO TINTO LIMITED – ASX RIO, OIL SEARCH LIMITED – ASX OSH, RIO TINTO PLC, TRIBECA INVESTMENT PARTNERS PTY LTD

ANZ-Roy Morgan Hong Kong Consumer Confidence Upbeat in February

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 25-Feb-15

The ANZ-Roy Morgan Hong Kong Consumer Confidence Index increased by 2.9 points to a record high of 135.9 in February 2015. The number of respondents who say their families are "better off" financially than 12 months ago has fallen by 0.5 per cent to 37.2 per cent. Meanwhile, the number of respondents who expect their families to be "better off" financially this time next year has risen by 1.3 per cent to 43.6 per cent

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

ANZ-Roy Morgan Taiwan Consumer Confidence Bodes Well For Growth

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 25-Feb-15

The monthly ANZ-Roy Morgan Taiwan Consumer Confidence Index increased by 1.9 points to a record high of 102.0 in February 2015. It is now well above its average of 89.1 in the previous 12 months. The number of respondents who say their families are "better off" financially than 12 months ago has risen by 0.1 per cent to 9.8 per cent. Meanwhile, the number of respondents who expect their families to be "better off" financially this time next year has risen by one per cent to 18.4 per cent

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

Jetpack dream achieves lift-off on ASX

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Original article by Sally Rose
The Australian Financial Review – Page: 21 : 25-Feb-15

Shares in Martin Aircraft Company were offered at $A0.40 in its Australian IPO, and the stock closed at $A0.44 on debut on 24 February 2015. The company has developed a wearable jetpack that will be priced from $US200,000 ($A250,000). Martin Aircraft aims to deliver the first Martin Jetpacks to customers in the second half of 2016

CORPORATES
MARTIN AIRCRAFT COMPANY LIMITED – ASX MJP, KUANGCHI SCIENCE LIMITED

QBE swings to profit after North American sell-off

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Original article by Ruth Liew
The Australian Financial Review – Page: 15 & 22 : 25-Feb-15

QBE Insurance Group has posted a 2014 profit of $US742m ($A950m), following a loss of $US254m previously. Revenue was six per cent lower at $US18.23bn, while it boasted an insurance profit margin of 7.6 per cent. QBE will gain $US95m from the sale of its workers’ compensation business in Argentina, which follows asset sales in 2014. Shareholders will receive a final dividend of $A0.22 per share

CORPORATES
QBE INSURANCE GROUP LIMITED – ASX QBE, STEADFAST GROUP LIMITED – ASX SDF, WESTPAC BANKING CORPORATION – ASX WBC, GENWORTH MORTGAGE INSURANCE AUSTRALIA LIMITED – ASX GMA, NIKKO ASSET MANAGEMENT GROUP

BHP and QBE drive index closer to 6000

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Original article by Misa Han
The Australian Financial Review – Page: 32 : 25-Feb-15

The Australian sharemarket posted solid gains on 24 February 2015, with the S&P/ASX 200 adding 0.3 per cent to close at 5,927. The Commonwealth Bank was 0.7 per cent higher at $A91.04 and BHP Billiton rose by 2.9 per cent to end the session at $A33.06. However, National Australia Bank shed 0.2 per cent to finish at $A37.58 and MMA Offshore was 11.7 per cent lower at $A0.87

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BHP BILLITON LIMITED – ASX BHP, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MMA OFFSHORE LIMITED – ASX MRM, RIO TINTO LIMITED – ASX RIO, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, QBE INSURANCE GROUP LIMITED – ASX QBE, WOODSIDE PETROLEUM LIMITED – ASX WPL, FLIGHT CENTRE TRAVEL GROUP LIMITED – ASX FLT, WESFARMERS LIMITED – ASX WES, WOOLWORTHS LIMITED – ASX WOW, TELSTRA CORPORATION LIMITED – ASX TLS, AMCOR LIMITED – ASX AMC, PM CAPITAL LIMITED, UBS HOLDINGS PTY LTD, CITIGROUP PTY LTD, BLOOMBERG LP, STANDARD AND POOR’S ASX ALL ORDINARIES INDEX

More capital might lead to lower Westpac dividends

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Original article by James Eyers
The Australian Financial Review – Page: 14 : 24-Feb-15

Westpac has regularly increased its interim dividend by $A0.02 since the first half of 2012, but this policy might be reviewed if regulators decide to introduce new capital levels. Morgan Stanley analyst Richard Wiles says such a review would also be necessary if economic conditions deteriorate in Australia. Morgan Stanley has a share price target on the stock of $A33.00

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, RESERVE BANK OF AUSTRALIA, MORGAN STANLEY AUSTRALIA LIMITED

Commodity currencies ‘could fall too far’

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Original article by Vesna Poljak
The Australian Financial Review – Page: 21 : 24-Feb-15

The Australian dollar was buying $US0.7831 late in trading on 23 February 2015. Citigroup is bearish about the outlook for the currency over the next 12 months, forecasting that it will continue its downward momentum. Meanwhile, Citigroup’s Todd Elmer believes that so-called "commodity currencies" remain overvalued, but he warns of the potential for them to be oversold

CORPORATES
CITIGROUP INCORPORATED, RESERVE BANK OF AUSTRALIA, RESERVE BANK OF NEW ZEALAND, BANK OF CANADA

$500m pay cut drives SMSFs to equities

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Original article by Philip Baker
The Australian Financial Review – Page: 21 : 24-Feb-15

Credit Suisse estimates that each 25 basis point reduction in the cash rate slashes the income of self-managed superannuation funds (SMSFs) by $A500m. The firm notes that SMSFs now boast some $A568bn worth of funds under management, with equities accounting for 42 per cent of their investment portfolios. SMSFs are likely to further increase their exposure to equities in order to offset the impact of lower interest rates

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, RESERVE BANK OF AUSTRALIA, STANDARD AND POOR’S ASX 200 INDEX, RIO TINTO LIMITED – ASX RIO, MACQUARIE GROUP LIMITED – ASX MQG, FLIGHT CENTRE TRAVEL GROUP LIMITED – ASX FLT, DULUXGROUP LIMITED – ASX DLX, PHILO CAPITAL ADVISERS PTY LTD, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, TELSTRA CORPORATION LIMITED – ASX TLS, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Strong M&A tipped for 2015

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 15 : 24-Feb-15

Data from Dealogic shows that some $US13.9bn ($A17.7bn) worth of mergers and acquisitions have been proposed in Australia so far in 2015. M&A experts are generally upbeat about the outlook for 2015, with Minter Ellison partner Ron Forster anticipating strong activity in the gold and iron ore sectors in particular. Karen Evans-Cullen of Clayton Utz notes that the downturn in the value of the Australian dollar may attract more bids from offshore groups

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, MINTER ELLISON, CLAYTON UTZ, BANK OF AMERICA AUSTRALIA LIMITED, MERRILL LYNCH (AUSTRALIA) PTY LTD, TOLL HOLDINGS LIMITED – ASX TOL, JAPAN POST, NOVION PROPERTY GROUP – ASX NVN, FEDERATION CENTRES – ASX FDC, PORT OF MELBOURNE, AUSTRALIA. DEFENCE HOUSING AUSTRALIA, BOART LONGYEAR LIMITED – ASX BLY, CENTERBRIDGE PARTNERS LP, GRESHAM PARTNERS LIMITED, MIZUHO BANK LIMITED