Good Morning Fellow Traders,
Thanks @Quantum Torus @Ravgnome and AM Loungers.
Seems like we've had two Fridays this week. Rest assured, this is the real one.
I see that The Gunners managed a draw against a predominantly ten sided Atletico at the Emirates this morning @senderos.
The Australian share market has been dragged lower by the big four banks after UBS downgraded Westpac in a report that questioned the quality of the lender's mortgage book.
The benchmark S&P/ASX200 index dropped 10.8 points, or 0.18 per cent, to 5,910.8 points, while the broader All Ordinaries index shed 6.4 points, or 0.11 per cent, to 6,003 points.
Phillip Capital senior client adviser Michael Heffernan said a report released by UBS, based on documents released by the financial services royal commission, cast doubt on the quality of Westpac's mortgage book, downgraded the lender's stock to "sell", and triggered further anxieties around a financial sector under intensifying scrutiny.
"You can trace the origins of this performance in the suggestion that Westpac's loan books are under stress, that's caused the infection for the whole banking sector," Mr Heffernan said.
"There's no question that the royal commission is increasing investor nervousness."
Westpac shares dropped $1.05, or 3.6 per cent, to $28.15, their lowest level since February 2016.
ANZ shed 2.1 per cent to $26.57, National Australia Bank dropped 2.1 per cent to $28.47 and Commonwealth Bank was 1.7 per cent lower at $72.25.
The banking regulator has also lifted a cap on new lending to property investors, and said it expects lenders to put in place restrictions that focus on a borrower's debt-to-income ratio.
Tribeca Investment Partners deputy portfolio manager Jun Bei Liu said this will make the banks' lending requirements more stringent.
Rising oil prices boosted local producers, with Origin Energy up 2.5 per cent at $9.49, Woodside Petroleum up 1.2 per cent at $32.17 and Oil Search one per cent higher at $7.89.
Rio Tinto shed 0.2 per cent to $79.40, BHP was down 0.8 per cent at $31.03 and Fortescue Metals dropped 1.8 per cent to $4.49.
Shares in building products supplier Boral continued to fall after its weaker-than-expected trading update on Tuesday, shedding 5.2 per cent to $6.52.
Blood plasma product maker CSL led gains among healthcare players, up 2.4 per cent to $165.65.
Coles owner Wesfarmers reversed early falls to gain 0.6 per cent to $43.13, as it reported a sharp fall in third quarter sales at its struggling Bunnings business in the UK and Ireland, while sales growth at Coles picked up slightly.
Woolworths gained 1.4 per cent to $27.41.
ON THE ASX:
* The benchmark S&P/ASX200 was down 10.8 points, or 0.18 per cent, at 5,910.8 points
* The broader All Ordinaries index was down 6.4 points, or 0.11 per cent, at 6,003 points
* The SPI200 futures contract was up 27 points, or 0.46 per cent, at 5,895 points
* National turnover was 3.3 bllion securities traded worth $7.9 billion
CURRENCY SNAPSHOT AT 1700 AEST:
One Australian dollar buys:
* 75.72 US cents, from 75.98 US cents on Tuesday
* 82.76 Japanese yen, from 82.70 yen
* 62.19 euro cents, from 62.25 euro cents
* 54.32 British pence, from 54.54 pence
* 107.24 NZ cents, from 106.91 NZ cents
GOLD:
The spot price of gold in Sydney at 1700 AEST was $US1,324.79 per fine ounce, from $US1,326.23 per fine ounce on Tuesday.
BOND SNAPSHOT AT 1630 AEST:
* CGS 5.75 per cent May 2021, 2.2487pct, from 2.2376pct on Tuesday
* CGS 2.25pct May 2028, 2.8689pct, from 2.8396pct
Sydney Futures Exchange prices:
* June 2018 10-year bond futures contract was 97.12 (implying a yield of 2.88pct), from 97.145 (2.855pct) on Tuesday
* June 2018 3-year bond futures contract was 97.71 (2.29pct), from 97.72 (2.28pct)
* Australian markets were closed on Wednesday for the Anzac Day public holiday
(*Bond market closes taken at 1630 AEST previous local session; currency closes taken from 1700 AEST previous local session)
U.S. stocks advanced on Thursday with each of Wall Street’s major indexes ending the session up 1 percent or higher, boosted by solid earnings results and a rebound in technology stocks as U.S. bond yields pulled back.
The tech-heavy Nasdaq snapped a five-day losing streak while the S&P technology index booked its first up day in six sessions.
Facebook surged 9.1 percent after posting an impressive earnings beat, which appeared to calm worries about the fallout from its use of consumer data.
Chipmakers Advanced Micro Devices Inc and Qualcomm Inc rose 13.7 percent and 1.4 percent, respectively, after quarterly results beat Wall Street estimates and alleviated worries over softening smartphone demand.
Their advances helped lift the Philadelphia Semiconductor index 2.1 percent, breaking its six-day losing streak and at the close of its best day in three weeks.
“Earnings continue to be better than expected and you have many of the geopolitical concerns like trade wars put on the back burner temporarily. And the commentary has been good,” said Channing Smith, managing principal at Jackson Hole Capital Partners in Tulsa, Oklahoma.
“It’s a tug-of-war market where you’ve concerns about the 10-year (Treasury bond) yield rising and inflation expectations rising and geopolitical concerns and the tariff concerns against the best earnings we’ve seen in years,” said Smith.
The yield on U.S. 10-year Treasuries closed below the 3 percent level as buyers emerged following a sell-off fueled by worries over growing U.S. debt issuance and rising costs.
The Dow Jones Industrial Average rose 238.51 points, or 0.99 percent, to 24,322.34, the S&P 500 gained 27.54 points, or 1.04 percent, to 2,666.94 and the Nasdaq Composite added 114.94 points, or 1.64 percent, to 7,118.68.
So far, 45 percent of S&P 500 companies have reported first-quarter earnings, with 79.7 percent beating consensus estimates. Analysts see 23.1 percent earnings growth for the quarter, based on a blend of actual and estimated results.
Amazon.com Inc shares jumped more than 6 percent in after-market trading after the online retailer reported a 43 percent surge in first-quarter revenue.
General Motors Co edged up 0.4 percent after the automaker reported a production drop of its high-margin pickup trucks, despite posting higher-than-expected profit.
United Parcel Service Inc shares rose 4.3 percent after the world’s largest package delivery company defied cost and weather headwinds to post higher first-quarter profit and strong volumes.
Visa Inc also helped lift the tech sector, advancing 4.8 percent following the payments network’s better-than-expected profit and earnings forecast raise.
AT&T Inc shares slumped 6.0 percent. It reported a loss of subscribers from its pay TV business.
Union Pacific Corp shares fell 2.9 percent. The No. 1 U.S. railroad operator cautioned on a key operating metric, helping send the Dow Jones Transportation Average down 0.9 percent.
In economic news, new orders for durable goods unexpectedly dropped in March as demand for machinery registered its biggest decline in more than two years, according to the Commerce Department. However, the Labor Department reported initial claims for unemployment fell to their lowest level since 1969, suggesting the labor market is at or near full employment.
Advancing issues outnumbered declining ones on the NYSE by a 2.26-to-1 ratio; on Nasdaq, a 2.06-to-1 ratio favored advancers.
Volume on U.S. exchanges was 6.74 billion shares, compared with the 6.67 billion-share average for the full session over the last 20 trading days.
Source: Netwealth Morning Business Roundup
A yummy and colourful end to the week breakfast of Caprese AvocadoToast and a Trio of Fruit Smoothies.
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