BUSINESS FORECASTING – AUSTRALIA

House prices now set for sustained decline

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Original article by Matthew Cranston
The Australian Financial Review – Page: 31 : 12-Jul-18

A survey by the ANZ Bank and the Property Council of Australia has found that confidence in the nation’s residential property market has fallen sharply. The national survey of property professionals shows that there has been a significant rise in the number of respondents who expect a further decline in house prices, particularly in Sydney and Melbourne. Respondents were also bearish regarding the availability of finance, and ANZ’s David Plank says this suggests that building approvals will fall in the next 6-12 months.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, PROPERTY COUNCIL OF AUSTRALIA LIMITED, MIRVAC GROUP – ASX MGR, STOCKLAND – ASX SGP

All eyes on big four as Macquarie lifts rates

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 11 & 16 : 10-Jul-18

There is growing speculation that Australia’s four major banks will increase their mortgage interest rates independently of the Reserve Bank. Macquarie is the latest bank to have advised of a rise in its variable rates for new and existing customers. Jonathan Mott of UBS says the large banks may opt to lift their rates in coming months to reflect the increase in their wholesale funding costs, although Sean Fenton of Tribeca Investment Partners notes that the major banks may be wary of attracting further political scrutiny at present. Some smaller lenders recently increased their mortgage rates.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, RESERVE BANK OF AUSTRALIA, UBS HOLDINGS PTY LTD, TRIBECA INVESTMENT PARTNERS PTY LTD, PEPPER GROUP LIMITED, AMP BANK LIMITED, SUNCORP BANK, AUSWIDE BANK LIMITED – ASX ABA, IMB LIMITED, ME BANK, BANK OF QUEENSLAND LIMITED – ASX BOQ, MORGAN STANLEY AUSTRALIA LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

Twiggy, Santos battle over gas developments

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Original article by Perry Williams
The Australian – Page: 17 & 27 : 10-Jul-18

Macquarie has suggested that Santos could find it hard to secure New South Wales government approval for its Narrabri coal-seam gas project if Australian Industrial Energy builds an LNG import terminal. AIE CEO James Baulderstone claims that the facility would be able to supply gas to NSW much faster and at much lower cost. However, Santos CEO Kevin Gallagher argues that gas from Narrabri would be much cheaper. The AIE consortium’s members include iron ore magnate Andrew Forrest.

CORPORATES
SANTOS LIMITED – ASX STO, AUSTRALIAN INDUSTRIAL ENERGY, MACQUARIE GROUP LIMITED – ASX MQG, NEW SOUTH WALES. DEPT OF PLANNING AND ENVIRONMENT

House prices are falling faster than expected

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Original article by Sarah Turner
The Australian Financial Review – Page: 1 & 2 : 3-Jul-18

The ANZ Bank predicted in March that Australian house prices would rise by two per cent over the course of 2018, but it now expects a decline of four per cent. The bank also expects house prices to fall by two per cent in 2019. National Australia Bank is also more pessimistic about the housing market than it was in March, while Paul Dale of Capital Economics notes that the banking royal commission has already seen banks tighten their lending standards. He says house prices could potentially fall by about five per cent in 2018-19.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, CAPITAL ECONOMICS LIMITED, HSBC AUSTRALIA HOLDINGS PTY LTD, BIS OXFORD ECONOMICS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, CORELOGIC AUSTRALIA PTY LTD, LAMINAR CAPITAL, LAZARD PTY LTD, RESERVE BANK OF AUSTRALIA

Ten looks local to weather cricket loss

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Original article by Dana McCauley
The Australian – Page: 24 : 2-Jul-18

UBS forecasts that Australia’s free-to-air TV advertising market will record growth of 1.5 per cent in 2018-19. The firm says elections at federal and state level will boost the ad revenue of the Seven and Nine networks. Meanwhile, UBS figures show that the Ten Network’s share of ad revenue fell sharply during the first half of 2018. Ten intends to ramp up its local content after losing the Big Bash League broadcasting rights, with a number of new shows set to debut in the second half.

CORPORATES
UBS HOLDINGS PTY LTD, NINE NETWORK AUSTRALIA LIMITED, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, SEVEN NETWORK LIMITED, SEVEN WEST MEDIA LIMITED – ASX SWM, TEN NETWORK HOLDINGS LIMITED, CBS CORPORATION, BIG BASH LEAGUE, CRICKET AUSTRALIA

More pain to come for Telstra investors

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Original article by Max Mason
The Australian Financial Review – Page: 19 : 22-Jun-18

Telstra shares fell to a seven-year low on 21 June, in response to its restructuring proposal and 2018-19 earnings guidance that was below market expectations. Citigroup is bearish about the EBITDA and earnings outlook for Telstra’s mobile division over the next four years, and the firm has downgraded its earnings per share forecasts. Citigroup and CLSA also expect Telstra to reduce its dividend payout in coming years.

CORPORATES
TELSTRA CORPORATION LIMITED – ASX TLS, CITIGROUP PTY LTD, CLSA AUSTRALIA PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG, VODAFONE HUTCHISON AUSTRALIA PTY LTD

Spotlight on iron ore about to shift to Rio Tinto

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Original article by Peter Ker
The Australian Financial Review – Page: 15 & 23 : 18-Jun-18

Recent announcements from BHP Billiton and Fortescue Metals Group that they will develop new iron ore mines in the Pilbara has prompted speculation as to when Rio Tinto will make a similar announcement. Koodaideri is widely tipped to be Rio’s next iron ore mine, and the project was first discussed by the resources giant’s board in late 2013. Rio Tinto’s head of iron ore, Chris Salisbury, is scheduled to hold a series of briefings and site visits for investors over the next week, although an announcement on Koodaideri is not expected to be made until later in the year.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, SHAW AND PARTNERS LIMITED, DEUTSCHE BANK AG, HANCOCK PROSPECTING PTY LTD

Fed hikes put squeeze on banks

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Original article by Karen Maley
The Australian Financial Review – Page: 1 & 28 : 15-Jun-18

The US Federal Reserve has signalled that two more interest rate increases are likely in 2018, following its second rate rise for the year. The new target range for the federal funds rate is between 1.75% and 2%, while the Reserve Bank of Australia has kept its cash rate at 1.5% for almost two years. The divergence in monetary policy has coincided with rising wholesale borrowing costs for Australia’s major banks, as well as a recent spike in the bank bill swap rate. Shane Oliver of AMP says local banks could potentially respond by increasing their mortgage rates on investment and interest-only loans.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, RESERVE BANK OF AUSTRALIA, AMP LIMITED – ASX AMP, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, FINANCIAL STABILITY BOARD, DEUTSCHE BANK AG, SOCIETE GENERALE SA, BNP PARIBAS SA, GRUPO SANTANDER

Caltex tips profit rise despite downturn

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 : 13-Jun-18

Caltex Australia has advised that its 2018 interim net profit is expected to be within the range of $A295m to $A315m, compared with $A294m previously. Caltex has also forecast that its fuels and infrastructure division will post half-year EBIT growth of nine per cent. However, its convenience retail division’s EBIT is expected to be 17 per cent lower than previously. This has been attributed to factors such as lower fuel margins and costs associated with dismantling its franchise model.

CORPORATES
CALTEX AUSTRALIA LIMITED – ASX CTX, SEAOIL, WOOLWORTHS GROUP LIMITED – ASX WOW, GULL PETROLEUM (NZ) LIMITED

Trust key to grab media spend: PwC

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Original article by Max Mason
The Australian Financial Review – Page: 28 : 12-Jun-18

PricewaterhouseCoopers has forecast that consumer spending on media and internet access will rise from $A24.1bn in 2017 to $A28bn by 2022. Megan Brownlow of PwC says trust will be a major factor in how this expenditure is allocated. PwC’s Australian Entertainment & Media Outlook 2018 report concludes that traditional media companies should benefit from a series of scandals that have eroded consumers’ trust in digital media companies such as Facebook.

CORPORATES
PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, FACEBOOK INCORPORATED, CAMBRIDGE ANALYTICA LLC