Good morning traders. Thanks to @ttward, @Ravgnome and the Aftermarket loungers.

 

Happy February, new month, but still the same things troubling the markets. That said, what a fine recovery we have put in over January after the horror show of December. Remains to be seen if it is merely a bear market rally, or the start of a new bull run. But either way, it has been great to see a bit of like back in our end of the market.

 

ASX Market Report

 

A strong performance by the energy and mining sectors was not enough to save the Australian share market from being weighed down by troubled financials at the close.

 

The benchmark S&P/ASX200 index was down 22 points, or 0.37 per cent, to 5,864.7 at 1630 AEDT on Thursday, while the broader All Ordinaries was down 13.9 points, or 0.23 per cent, at 5,937.3

 

"Overall if you look at the performance of the Australian share market for January, it's pretty good results," CommSec markets analyst James Tao said.

 

"The ASX is up about 4.5 per cent which is the best monthly performance we've seen in more than two years."

 

Stocks in the mining sector continue to soar as the fallout from the deadly Brazil mining disaster coupled with Chinese demand for iron ore helped elevate export prices.

 

The price index of Australian metal ore and metal scrap exports rose 9.0 per cent in the three months since September, and 17.8 per cent for the year-to-date, according to data released on Thursday by the Australian Bureau of Statistics.

 

Shares for mining giant BHP closed up 0.66 per cent to $34.83 while Fortescue Metals rose 4.24 per cent to $5.65 after it reported a five per cent rise in second-quarter iron-ore shipments.

 

Beach Energy lifted 5.57 per cent to $1.80 after it raised its production guidance for fiscal 2019 citing better-than-expected output in the first half of the year.

 

Rising oil prices have continued to bolster the energy sector with Oil Search rising 2.23 per cent to $7.81 and Santos up 2.54 per cent to $6.47.

 

But the heavyweight big four banks continued to weigh down the market with investors bracing for a tough final report from the financial services royal commission that is due to be released publicly on Monday. Westpac led the losses, down 2.54 per cent to $24.55.

 

"As we near closer and closer to the big reveal on Monday, the fact that the report will be released after markets close has made people a little bit jittery as to what might happen," CommSec markets analyst James Tao said.

 

Commonwealth bank finished 1.87 per cent lower at $69.91, as did ANZ down 1.77 per cent to $25.03, and NAB was down 1.61 per cent to $23.86.

 

A surge in tech stocks was boosted by Facebook's strong results in the US, and the sector was the strongest performer of the day.

 

Altium Limited was up 3.92 per cent to $24.95, Wisetech Global rose 4.36 per cent to $20.34 and Xero lifted 8.77 per cent to $43.53.

 

Following a solid start to the week Telstra shares have fallen 2.51 per cent over the day to $3.11.

This comes as Optus announces their 5G broadband network is live, making it the first carrier in Australia to commercialise the technology.

 

Elsewhere Qantas stocks slid 2.68 per cent to $5.44, as engine troubles and a weaker tourism market rocked rival Air New Zealand's earnings forecast on Wednesday.

 

ON THE ASX:

*The benchmark S&P/ASX200 index was down 22 points, or 0.37 per cent, to 5,864.7

*The All Ordinaries was down 13.9 points, or 0.23 per cent, lower at 5,937.3

* At 1630 AEDT, the SPI200 futures index was down 23 points, or 0.39 per cent, at 5,804

 

CURRENCY SNAPSHOT AT 1630 AEDT:

One Australian dollar buys:

*72.69 US cents, from 71.95 US on Wednesday

*79.05 Japanese yen, from 78.66

*63.19 euro cents, from 62.90

*55.37 British pence, from 54.96

*105.15 NZ cents, from 105.06

 

GOLD:

The spot price of gold in Sydney at 1630 AEDT was $US1320.58 per fine ounce, from $US1313.74 on Wednesday.

 

In Asia

 

Asia stocks rose to a four-month high on Thursday after the Federal Reserve pledged to be patient with further interest rate hikes, signalling a potential end to its tightening cycle amid signs of slowing global growth.

 

The dollar struggled near a three-week trough against its major peers and U.S. Treasury yields were significantly lower as investors reacted to the Fed's change in tone.

 

MSCI's broadest index of Asia-Pacific shares outside Japan rose to its highest since Oct. 4 and was last up 0.9 percent. Japan's Nikkei rose 1 percent.

 

The Shanghai Composite Index climbed 0.3 percent despite data showing China's factory activity contracted for a second straight month amid weakening orders.

South Korea's KOSPI added 0.3 percent.

Read more

 

In Europe

 

(Sorry I think the Euro wrapup writers took the day, so just the UK today because you don’t pay me enough to write one myself).

 

London's blue-chip stocks bagged gains for a third consecutive session on Thursday as stellar earnings from Shell (LON:RDSa) and Diageo (LON:DGE) helped cushion losses in banks and growing concerns over Europe's economic health.

 

The FTSE 100added 0.4 percent after earlier hitting its highest level in nearly three weeks, while the midcap index handed back earlier gains to close 0.6 percent lower.

 

A positive tone was initially set with Asian shares bouncing to a four-month high after the Federal Reserve pledged it will be patient with further interest rate hikes, signalling a potential end to its tightening cycle amid signs of slowing global growth.

 

The blue chips handily outperformed their European peers on Thursday and were on course for their best monthly performance since April.

 

But UK markets saw some of that cheer fade as weakness from Europe spilled over with data showing that the euro zone economy stuck to its lowest pace of growth in four years in 2018's last three months.

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In European Equity Markets the pan-European Stoxx 600 closed unchanged, with sectors and major bourses pointing in opposite directions. Banks were by far the worst performing sector, down 2 percent, weighed down by an 11 percent downturn in Metro Bank shares. 

 

Other news weighing on the sector was a report that Deutsche Bank was gearing up for a potential merger with rival Commerzbank by mid-2019 in case its restructuring efforts fall short of targets. Shares of the German lenders fell around 5 percent.

 

In the United States

 

 The S&P 500 and the Nasdaq extended a rally on Thursday as strong earnings from Facebook Inc added to optimism after the Federal Reserve’s dovish remarks, while investors waited for the outcome of U.S.-China trade talks.

 

Facebook jumped 11.58 percent, on track for its best day since January 2016 after its quarterly profit topped expectations and showed that advertisers were still flocking to the social network even after a series of high profile embarrassments.

 

General Electric Co soared 12.97 percent after the industrial conglomerate beat estimates for quarterly sales and cash flow and said it sees industrial revenue rising modestly in 2019.

 

Investors took heart from the Fed’s pledge on Wednesday that it would be patient in raising interest rates further this year, easing concerns about tightening financial conditions crimping economic growth.

 

U.S. President Donald Trump expressed optimism about the trade talks, but said no final deal would be made until he meets with Chinese President Xi Jinping in the near future.

 

At 2:18 p.m. ET, the Dow Jones Industrial Average was down 0.22 percent at 24,958.58 points, while the S&P 500 had gained 0.72 percent to 2,700.5. The Nasdaq Composite added 1.31 percent to 7,277.26.

 

The S&P communications services sector surged 3.76 percent, leading gains among the 11 major S&P sectors, thanks to Facebook, Alphabet and Charter Communications Inc.

 

The Dow was dragged down by losses in DowDuPont Inc, which fell 8.43 percent after the chemical maker’s revenue fell short of expectations. The S&P materials sector dropped 1.53 percent.

 

The S&P 500 posted 24 new 52-week highs and no new lows; the Nasdaq Composite recorded 40 new highs and 19 new lows.

 

Australian News

 

The banking industry's chief lobbyist concedes that civil or criminal referrals to Commonwealth prosecutors are a live possibility, when the final report of the banking royal commission is released on Monday. 
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As the general global banking industry undergoes a period of change, it seems certain that some of the measures introduced in former eras may well come to an end sooner rather than later. With the growing prevalence of so-called neobanks, and plenty of challenger startups to help individuals get around common problems such as credit card fees, there appears to be a need to react to it. 
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It is a tricky time for sitting politicians right now. With the release of the long-awaited Hayne report from the Royal Commission inquiry into widespread financial misconduct now imminent, there are plenty of decisions to make. With the banks themselves having been lambasted for all sorts of reasons, from charging for services for deceased customers, to selling products that were not suitable for vulnerable households, a range of problems have been unearthed. 
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AMP has continued to refresh its board after the embattled wealth manager's royal commission-related clear out, appointing Andrea Slattery as a non-executive director. 
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Global mining titans BHP and Rio Tinto on Thursday backed a high-profile campaign to give indigenous Australians a constitutionally guaranteed voice in white-dominated politics. In a joint statement, the firms endorsed what would be a historic change in Australia's constitution, offering aboriginal groups a formal role in the running the country.
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Australian farmers can expect global appetite for their produce to grow throughout 2019, but the nation's $60 billion agriculture sector faces mounting climate fears and bleak economic forecasts. 
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A Senate report has called for the government to set a national target for the number of electric vehicles in commonwealth fleets to boost the uptake of EVs in Australia and bring EV racing to the nation to increase public support for electric cars. However, the report's writers said it does not go far enough to accelerate EV uptake and warned Australia would be left behind the rest of the world. 
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China exec accused of criminal conspiracy set up Huawei in Australia. The Huawei executive at the centre of an international sanctions-busting and trade secrets theft scandal established and oversaw the firm’s Australian operation while she was allegedly engaged in a global criminal conspiracy. Meng Wanzhou was a director of Huawei’s Australian subsidiary between October 2005 and August 2011, according to corporate records. 
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Global News

 

President Donald Trump expressed optimism about forging a comprehensive trade deal with China as high-level talks continued on Thursday, but said any arrangement that fails to open Chinese markets broadly to U.S. industry and agriculture would be unacceptable. 
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General Electric Co beat estimates for sales and cash flow in the fourth quarter and said on Thursday it had reached a tentative deal to settle a subprime mortgage case with U.S. regulators, sending its shares sharply higher. 
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Apple says Facebook can no longer distribute an app that paid users, including teenagers, to extensively track their phone and web use. In doing so, Apple closed off Facebook's efforts to sidestep Apple's app store and its tighter rules on privacy. 
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Taiwanese electronics giant Foxconn said Thursday it was reassessing plans to build a cutting-edge factory in Wisconsin, an investment hailed by President Donald Trump as a flagship example of his push to revive America's manufacturing sector. 
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Musk not worried about Tesla Model 3 demand, but Wall St. is 
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Facebook shares rise as products back in focus after strong fourth quarter 
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Investment in British car production fell by almost half in 2018 in a "disturbing" trendpartly due to uncertainty over Brexit, according to figures released Thursday by an industry body. The Society of Motor Manufacturers (SMMT) annual data showed investment in the sector was down by 46.5 percent on the previous year, to £589 million ($769 million, 673 million euros). 
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European leaders moved Wednesday to head off British Prime Minister Theresa May's bid to rewrite the Brexit divorce deal, warning they will not budge. Having thrown out the exit deal May negotiated with the EU, divided British lawmakers voted Tuesday to send her back to get an Irish border "backstop" clause removed. 
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German Economy Minister Peter Altmaier said Wednesday Berlin would intervene to lift economic growth after the federal government slashed its forecast for 2019. "It's about strengthening growth momentum again with smart action from the government," Altmaier told journalists after predicting just 1.0 percent expansion this year, 0.8 percentage points lower than in an autumn outlook. 
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The European aerospace group Airbus said Wednesday it had detected an incident that "resulted in unauthorised access to data" in its commercial aircraft division. The group "detected a cyber incident on Airbus 'Commercial Aircraft business' information systems," but it did not affect commercial operations, a statement said. 
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Italian Prime Minister Giuseppe Conte said the economy probably shrank in the fourth quarter, plunging Italy into a recession that would put pressure on the populist government's spending plans. 
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China will relax rules on IPOs for a planned Nasdaq-style tech board in Shanghai as it seeks to encourage start-ups to list at home after losing the likes of Alibaba and Baidu to Wall Street. Existing rules on initial public offerings ban companies from listing unless they have a track record of profits, and put caps on their pricing and how much they are allowed to rise or fall. 
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Stock News

 

Kogi Iron progressing partnership discussions to develop Agbaja Cast Steel Project 
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Billionaire investors are being encouraged to visit WA to see the energy revolution that the Government hopes will power the State’s economy. The Opposition has branded the strategy a plan for a plan, but Premier Mark McGowan says if it works we can expect thousands of jobs and billions in revenue for WA. 
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Shares in Galena Mining have soared after the company announced the sale of a 40 per cent stake in its Abra lead-silver project in the Gascoyne to Japan’s Toho Zinc for $90 million. The cash will help Galena with pre-development works, permitting and ultimately financing of the project, which hosts a resource of 37.4 million tonnes at 7.5 per cent lead and 18 grams per tonne silver. 
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GetSwift shares dropped as much as 16 per cent on Thursday after the logistics solutions group revealed a slowdown in revenue growth for the December quarter and reported rising costs from its legal battles and increased corporate governance requirements. On Wednesday evening GetSwift reported that total revenue and other income for the December quarter was $710,854. 
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Trade well.