29
19 December 2014
Market News
Key Market Data
That “whoosh” you heard might have been the US Dow index taking off last night
(up 421 pts) or the sympathy rally from our ASX 200 index today with a close 127.8
pts higher than yesterday! These are big moves no matter how you look at them
and could herald the next leg up… the mythical Santa rally. As identified last week
energy stocks looked like they were trying to find a base and we saw some nice
bounces in the sector. Woodside rallied 11.6% this week from low to high and Oil
Search and Santos showed similar runs. Be careful entering at these levels unless
we see a change in oil pricing, but there has certainly been some buying and it will
be interesting to see how we trade through the Christmas period.
Source: yahoo finance
Gold stocks continued to push higher but there is no sign of urgency in their moves
and spot gold continues to trade around the USD 1200 level. A fairly bland report
from the Federal Reserve Bank on Thursday did nothing for the shiny metal, but
continued to promote the belief that interest rates are still set to rise in the US at
some time in 2015. Let’s wait and see.
Retail continued to struggle and whilst there are probably some value buyers
nibbling at these levels, it may take some solid reporting after the Christmas trading
period before there is much new interest in the beaten down sector. This is a sector
to watch for 2015.
Lastly, we only have a few trading days left in the year, but we will be on the desk
for every one of them, and so if you are wanting to stuff your portfolio sack, give us
a call, otherwise Merry Christmas and Happy holidays for those taking them.
Contributor Tony Garnham
Data due next week:
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

Australia – 24TH December ASX closes 2.10pm.
China –.industrial profits, for Nov (Saturday)
US – existing home sales for Nov, UMich consumer sentiment, Dec (final),
Richmond Fed manufacturing index for Dec, FHFA house price index for Oct.
Australian Corporate News:

AMP: AMP has won the $1 billion-plus auction for Sydney’s Royal North
Shore Hospital public-private-partnership, sources said on Thursday night.
AMP will need to restructure some $1 billion of RBS debt, which was
acquired in 2007 before the global financial crisis, as well as swaps.

FLT - Flight Centre: Low consumer confidence has forced Flight Centre to
downgrade its pre-tax earnings guidance by up to 4 per cent due to the
poorly performing Australian ¬leisure travel sector. Buoyed by strong
results from its British and US business arms, the company said full-year
AG Insights – 19/12/2014
Market Indices (This Week)
Index
ASX 200
S&P 500
FTSE 100
Hang Seng
Nikkei 225
Last
5,338.60
2061.23
6,466.00
23,122.26
17,595.53
Change %
2.28
1.26
0.07
0.90
0.45
Economic Statistics (This Week)
Commodity
AUD/USD
EUR/USD
Gold (US$)
Iron (US$)
Oil (US$)
Last
0.8182
1.2278
1,196.74
68.42
54.32
Change %
-1.11
-0.97
0.23
-1.37
-8.31
Upcoming Dividends
Stock
APA
Div.
0.175 UF
Date
22/12
(FF – Fully Franked, UF - Unfranked,
PF – Partial Franked)
pre-tax profit could top $390 million but was all but certain to be dragged
down to $360m because of lower earnings from Flight Centre’s domestic
leisure travel business coupled with the cost of the group’s ambitious
expansion plans put at up to $12m yesterday. The profit warning sent Flight
Centre’s shares sliding by more than 9 per cent yesterday to close at
$31.87.

NAB - National Australia Bank: Chairman Michael Chaney has rejected
accusations of an “entrenched culture of apathy” plaguing the bank’s
senior ranks, and assured investors the bank was quickly trying to resolve
the issue of legacy assets dragging down returns. After suffering a 10 per
cent fall in cash earnings for full-year 2014, shareholders yesterday vented
their frustration at NAB’s annual meeting in Brisbane. One shareholder
labelled the board a “leaderless flock of docile sheep” and others
demanded answers on when the troubled British operations would be sold,
reports The Australian.
TAB - Tabcorp: Wagering giant Tabcorp could have its NSW and Victorian
thoroughbred racing broadcast rights snatched by the Seven Network,
which is considering stepping in as negotiations between Tabcorp and
racing-owned broadcaster ThoroughbredVision Network fall over, sources
say. The protracted talks between Tabcorp and TVN, which have been
running for almost two years, fell over on Wednesday, leading the crucial
races to be pulled from Tabcorp’s Sky Racing.

TLS - Telstra: Telstra is set to pick up more than 50 per cent of the design
and planning work for the ¬National Broadband Network in a deal worth
hundreds of millions of dollars to the telco giant. The nation’s No 1 telco is
also in the box seat to pick up build and maintenance contracts potentially
worth billions of dollars in a separate deal to help speed up construction of
the $41 billion project.

Annual General Meeting –ALS
Biggest Gainers (Today)
Stock
MIN
CVO
MSB
AAD
LNG
Last
7.40
1.992
4.39
2.92
2.39
Change %
9.63
9.45
8.40
7.75
7.66
Biggest Losers (Today)


Upcoming Corporate Events
WPL - Woodside Petroleum: India is shaping up to be a much more serious
market for Australian liquefied natural gas than many currently believe,
judging by the broad hints being dropped by Woodside Petroleum chief
executive Peter Coleman. Coleman was part of Tony Abbott’s select
business delegation to India in September and was also on the scene when
Indian Prime Minister Narendra Modi met with top business leaders in
Sydney in November.
WOW - Woolworths: Woolworth’s buyers have told suppliers their
products could be pulled from shelves just days before Christmas if they
refuse to fund the supermarket giant’s new Cheap Cheap advertising
campaign. Fairfax Media can reveal the ACCC has now assigned one of
Australia’s most experienced investigators to probe claims Woolworths is
engaging in unconscionable conduct by demanding suppliers pay tens of
millions of dollars by the end of December, reports The AFR.
Stock
SXY
BCI
SXL
KAR
SKC
Last
0.32
0.485
1.005
2.26
3.64
Change %
7.25
3.96
3.37
3.00
2.93
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AG Insights – 19/12/2014