STOCK PRICE FORECASTING – AUSTRALIA

Sovereign debt could well be the driver of the next share selloff

roymorgansocial Leave a comment

Original article by Philip Baker
The Australian Financial Review – Page: 32 : 6-Oct-16

Australia’s benchmark S&P ASX 200 is currently trading on a forward price-earnings ratio of around 16 times, compared with its long-term average of about 14.5 times. The index reached a 2016 high of 5,587 points at the start of August, and despite a number of pullbacks it is still three per cent higher than at the start of the year. However, the prospect of an eventual end to quantitative easing by central banks is likely to put upward pressure on government bond yields, which will in turn weigh on sentiment toward equities.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, ROYAL BANK OF SCOTLAND GROUP PLC, THE GOLDMAN SACHS GROUP INCORPORATED, JP MORGAN CHASE AND COMPANY, UNITED STATES. FEDERAL RESERVE BOARD, FEDERAL RESERVE BANK OF RICHMOND, SYDNEY AIRPORT – ASX SYD, TRANSURBAN GROUP LIMITED – ASX TCL

Bull market in bonds not over just yet: Citi

roymorgansocial Leave a comment

Original article by Chris Kohler
The Australian – Page: 32 : 27-Sep-16

The yield on Australian 10-year government bonds peaked at 2.13 per cent on 21 September 2016, but it has since retreated to below the two per cent level. Citigroup does not believe that the recent spike in bond yields will signal the end of the three-decade bull market, and the firm does not expect the rise in yields to be sustained. Citigroup notes that financial stock are among those that should benefit from higher bond yields, while it says Australian stocks that are vulnerable include real estate investment trusts and utilities.

CORPORATES
CITIGROUP PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, APA GROUP – ASX APA, SYDNEY AIRPORT – ASX SYD, TATTS GROUP LIMITED – ASX TTS, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, HEALTHSCOPE LIMITED – ASX HSO, QANTAS AIRWAYS LIMITED – ASX QAN, RIO TINTO LIMITED – ASX RIO, MACQUARIE GROUP LIMITED – ASX MQG, CALTEX AUSTRALIA LIMITED – ASX CTX, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF JAPAN, EUROPEAN CENTRAL BANK

Investors warned not to expect smooth ride

roymorgansocial Leave a comment

Original article by Vanessa Desloires
The Australian Financial Review – Page: 31 : 23-Sep-16

Australian equity strategists are cautious about the near-term outlook for the domestic bourse, with most still expecting the S&P/ASX 200 to be trading at around the 5,500-point level at the end of 2016. Meanwhile, Tony Brennan of Citigroup forecasts that the benchmark index will top 5,750 points by mid-2017. With the US Federal Reserve opting to leave interest rates on hold in September, David Cassidy of UBS says the presidential election could influence the timing of the next interest rate move.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF JAPAN

Fund managers to Fed: it’s time to raise rates

roymorgansocial Leave a comment

Original article by Vesna Poljak
The Australian Financial Review – Page: 13 & 27 : 14-Sep-16

Financial markets have priced in a 22 per cent chance that the US Federal Reserve will increase interest rates in September 2016, while a December increase is rated a 57 per cent chance. PM Capital’s Uday Cheruvu expects the US central bank to tighten monetary policy at some point, noting that there are sufficient grounds for a rate rise. Meanwhile, Randal Jenneke of T. Rowe Price says Australian yield stocks – which bore the brunt of bearish sentiment on 12 September – are likely to fall further.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, PM CAPITAL LIMITED, T ROWE PRICE GROUP INCORPORATED, STANDARD AND POOR’S ASX 200 INDEX, EUROPEAN CENTRAL BANK, BANK OF JAPAN, BANK OF ENGLAND

Correction fears as bears claw back hopes of rally

roymorgansocial Leave a comment

Original article by Chris Kohler, Daniel Palmer
The Australian – Page: 19 & 28 : 14-Sep-16

The Australian sharemarket posted further losses on 13 September 2016, after initially rebounding from the sharp fall in the previous trading session. However, US markets rallied after Federal Reserve official Lael Brainard said the central bank should adopt a cautious approach to tightening monetary policy. The Australian market has shed about six per cent in the last three weeks, and Lucinda Chan of Macquarie Private Wealth says further profit-taking is likely.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, MACQUARIE PRIVATE WEALTH MANAGEMENT PTY LTD, DOW JONES INDUSTRIAL AVERAGE INDEX, STANDARD AND POOR’S 500 INDEX, NASDAQ COMPOSITE INDEX, WOOLWORTHS LIMITED – ASX WOW, MYER HOLDINGS LIMITED – ASX MYR, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, TELSTRA CORPORATION LIMITED – ASX TLS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Central bank fears spook markets

roymorgansocial Leave a comment

Original article by Jacob Greber, Sally Rose, Jessica Sier
The Australian Financial Review – Page: 1 & 6 : 12-Sep-16

Australia’s S&P/ASX 200 Index has shed 4.4 per cent since the start of August 2016, and a 2.5 per cent downturn in the S&P 500 is expected to push the local market lower on 12 September. The US market was sold down after a Federal Reserve official suggested that the strength of the US economy could warrant an interest rate cut in the near-term. This prompted renewed support for the US dollar and a sharp rise in bond yields. Meanwhile, Nick Bishop of Aberdeen Asset Management expects an upturn in global financial market volatility in the December quarter.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, STANDARD AND POOR’S 500 INDEX, UNITED STATES. FEDERAL RESERVE BOARD, ABERDEEN ASSET MANAGEMENT LIMITED, CITIGROUP PTY LTD, UBS GLOBAL ASSET MANAGEMENT (AUSTRALIA) LIMITED, EUROPEAN CENTRAL BANK, RESERVE BANK OF AUSTRALIA

MMG races to ramp up copper

roymorgansocial Leave a comment

Original article by Matt Chambers
The Australian – Page: 23 : 15-Aug-16

MMG’s Las Bambas copper mine in Peru is on track to achieve full-year production of about 348,000 tonnes of copper concentrate, after output rose from 31,470 tonnes to 87,142 tonnes in the June 2016 quarter. Macquarie Group had forecast production of just 75,000 tonnes in the second quarter, and it anticipates output of 450,000 tonnes in 2017. Macquarie has upgraded its recommendation on MMG shares from "neutral" to "outperform", and its share price target has been raised from $A3.15 to $A5.80.

CORPORATES
MMG LIMITED – ASX MMG, MACQUARIE GROUP LIMITED – ASX MQG, GUOXIN INTERNATIONAL INVESTMENT CORPORATION LIMITED, CITIC LIMITED, XSTRATA AG, GLENCORE PLC

Fund managers cautious on resources rally

roymorgansocial Leave a comment

Original article by Vanessa Desloires
The Australian Financial Review – Page: 18 : 15-Aug-16

The benchmark S&P/ASX 200 has gained 3.5 per cent so far in 2016. In contrast, the resources sector (excluding gold stocks) has gained about 15 per cent in the year to date. However, some analysts have questioned whether the sector’s recent performance can be sustained. ST Wong of Prime Value Asset Management suggests that further economic stimulus measures in China will be needed in order to boost demand for commodities.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, PRIME VALUE ASSET MANAGEMENT LIMITED, FIDELITY AUSTRALIAN OPPORTUNITIES FUND, FORAGER FUNDS MANAGEMENT PTY LTD, CITIGROUP PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, SOUTH32 LIMITED – ASX S32, WHITEHAVEN COAL LIMITED – ASX WHC, MACMAHON HOLDINGS LIMITED – ASX MAH, MONADELPHOUS GROUP LIMITED – ASX MND, BHP BILLITON LIMITED – ASX BHP

Resources on the rebound, but is it time to get on board?

roymorgansocial Leave a comment

Original article by Philip Baker
The Australian Financial Review – Page: 26 : 11-Aug-16

A rise in the spot prices of some commodities may signal a recovery in the resources sector. Investors are optimistic. The share prices of Australian-listed mining companies have risen 25 per cent since the beginning of 2016. Fortescue Metals Group’s stellar performance is particularly impressive. The stock has risen from $A1.44 in January to $A4.50 on 9 August.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, FORTESCUE METALS GROUP LIMITED – ASX FMG, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, BELL POTTER SECURITIES LIMITED

Strategists see little to fire the ASX 200 past 5500 by end of year

roymorgansocial Leave a comment

Original article by Vanessa Desloires
The Australian Financial Review – Page: 1 & 11 : 9-Aug-16

Australia’s benchmark S&P/ASX 200 Index closed at 5,537.8 points on 8 August 2016, but opinion is divided on the level at which it will be trading by the end of the year. Morgan Stanley still expects the ASX 200 to fall to 4,800 by years’ end, although Citigroup, UBS and Credit Suisse forecast that it will be trading at around 5,500. Meanwhile, Tony Brennan of Citigroup expects it to be trading at 5,750 in mid-2017.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, MORGAN STANLEY AUSTRALIA LIMITED, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WOOLWORTHS LIMITED – ASX WOW