ASB Securities Morning Brief for Tuesday, 28 April 2015
Tuesday, 28 April 2015

New Zealand Headlines

New Zealand Market Report: New Zealand shares rose, paced by Spark New Zealand and Meridian Energy, as investors sought dividend paying stocks. Xero dropped after it reported its full year loss nearly doubled. The NZX 50 Index rose 7.447 points, or 0.1 percent, to 5765.356. Within the index, 22 stocks rose, 20 fell and nine were unchanged. Turnover was $133 million... Read more

The New Zealand dollar is heading for a 1.7 percent decline this week after Reserve Bank assistant governor John McDermott ruled out interest rate hikes ahead of the central bank's official cash rate review next week. The kiwi fell to 75.63 US cents at 5pm in Wellington, from 76.94 cents at 8am on Monday. At the start of the week, five currency advisers in a BusinessDesk survey said the kiwi could fall, five said it could gain and three said it would likely remain largely unchanged... Read more

Cash rate tipped to hold, for now. Reserve Bank stuck between ‘rock and a hard place’ of near-zero low inflation in a hot domestic economy.... Read more

Horticultural production exceeds $7 billion mark for first time... Read more

John Key touches down for historic trade-focussed visit to Middle East... Read more

Trade First Then Talk Human Rights with Saudi Arabia – Key... Read more

Tourism businesses expect boost from first Anzac Mondayisation. Anzac weekend is the first test run of the 'Mondayisation Bill' slated to boost domestic tourism.... Read more

Wool prices have recovered some lost ground and are expected to remain steady throughout the year, says ASB Bank in its latest commodities report. Coarse wool prices (35 micron) over the past four weeks have averaged about 5 per cent higher than the corresponding four weeks three months ago, the bank said... Read more

Horticultural production tops $7 billion, driven by wine and apples... Read more

Representatives from the Five Nations Beef Alliance are in Maryland this week pushing for beef trade liberalisation through the proposed Trans Pacific Partnership (TPP) deal. The alliance, which comprises industry organisations from New Zealand, Australia, Mexico, Canada and the United States, said the TPP negotiations seemed to be approaching the "end game" and talks over the next few days would be critical... Read more

Big Fonterra meetings 'fuel frustration'. Radical change called for to the Fonterra Shareholders Council to better serve interests of 10,000-or-so farmer-owners. Fonterra farmers need a return to small, local meetings about their company's business with an empowered and highly knowledgeable shareholder councillor as the risk grows of losing the big co-operative forever, says a Waikato farmer... Read more

California dry could support dairy prices. Drought conditions are biting into California's dairy production, which could end up being supportive for international dairy prices, say analysts. The state, America's biggest producer and a major dairy exporter in its own right, has suffered four years of drought.... Read more

'Best in class' KiwiSaver schemes easy to identify. Clear winners in each category; it's your money, you don't have to put up with inferior performance and excess risk; fund names not an indicator of risk... Read more

Xero shares slump as annual loss widens... Read more

NZ firm WhosOnLocation seeks to raise $3m in Australia. New Zealand technology firm WhosOnLocation is seeking to grow rapidly, eyeing funding of up to $NZ3 million ($2.9m) from its biggest market, Australia. WhosOnLocation uses cloud computing technologies to manage the presence and safety of workers in an office, construction site, school or manufacturing plant... Read more

Windflow shareholder ups stake but wants no board seat... Read more

Renewables menace traditional power model. Alone, one solar-powered household cannot produce enough electricity to destabalise the traditional power model. But thousands ..... Read more

A hangover craving for a Kiwi pie has turned into a successful business for two Wellingtonians living in China. When couple, Olivia Fowler and Ryan McLeod, moved to Shanghai in 2013, they never envisaged setting up a pie making business, or that it could become so successful... Read more

Education to improve small business insurance cover. The Insurance Council is creating tools to educate small businesses on the importance of the insurance cover to protect them in the event of a disaster like the Canterbury earthquakes. The council, in partnership with the Young Enterprise Trust is targeting the sector... Read more

An Auckland Council entity has commissioned a study into Hobsonville Point land becoming this city's Wellywood. Brett O'Riley, Auckland Tourism, Events and Economic Development (Ateed) chief executive, said KPMG had been engaged to examine the feasibility of the private sector developing the prime northwestern council-owned site for much-needed filming venues... Read more

Airport hub expanding rapidly. Work underway on stage three of business park that will eventually cover 100ha. Work on the latest phase of Auckland International Airport's fast-expanding commercial hub is well under way, ready for new buildings... Read more

The changing face of retail and its commercial property spin-offs. With consumers increasingly holding the power in the retail chain, traditional retail shopping precincts are changing their offerings to reflect evolving expectations and demands of an astute buying audience.... Read more

Opus wins award for innovative environmental management... Read more

Cornwall Park Trust lease proposal rejected. A group representing 110 lessees with houses on Cornwall Park Trust Board land through Greenlane and One Tree Hill has rejected a proposal to change their lease terms... Read more

Sprawling Matamata animal safari for sale... Read more

Opinion - Pita Alexander: Working with our Australian neighbours. We don't need to love - or even like our neighbour, but if we are going to borrow or do business with them then we must do our homework. Australia is our trans-Tasman neighbour and has often been referred to as our big brother... Read more

Opinion - Gareth Vaughan: FMA warning on bank capital notes welcome, but much more can be done to give the Kiwi retail investor a fair go. It's something most of us have seen. No sooner does someone dump the remains of a fish dinner in their rubbish bin than a cat or dog comes along smelling a treat on offer... Read more

Opinion - Liam Dann: World's coolest economist hot on his numbers. Wall St veteran lays down his ideas about China’s rebalancing like a beat poet... Read more

Australian Headlines

Australian Market Report: The Australian sharemarket rallied after a strong bounce in the iron ore price helped drive mining stocks higher, potentially paving the way for another charge toward the elusive 6,000 mark. At the 4.15pm (AEST) official market close, the benchmark S&P/ASX200 index was up 49.4 points, or 0.83 per cent, at 5,982.7, while the broader All Ordinaries index was up 48 points, or 0.81 per cent, to 5,954.8.... Read more

The Australian dollar has edged higher on the back of softer-than-expected US economic data and as traders await a speech from Reserve Bank of Australia Governor Glenn Stevens tomorrow. The Australian dollar was worth US78.27 cents at noon (AEST), up from US78.10 cents on Friday... Read more

The head of the Financial System Inquiry, David Murray, has again called on the banks to improve their capital positions as the federal government runs the risk of losing its triple-A credit rating, The Australian Financial Review reports... Read more

Risks of mortgage defaults in Sydney and Melbourne are growing as soaring house prices are matched with bigger loans and deteriorating affordability, ratings agency Moody's warns... Read more

The federal government is losing nearly $400 million a year in tax revenue from employers who cheat workers out of compulsory superannuation contributions, an industry super fund says... Read more

Battle over whether superannuation funds should have majority independent trustees hots up. Industry super funds have consistently outperformed for-profit retail funds run by the big banks and AMP since compulsory superannuation started in Australia in 1992... Read more

Australia's share market operator is planning to enforce stricter rules on company earnings forecasts despite objections from an investor relations group. From July 1, companies listed on the Australian Securities Exchange will be required to explain themselves if their guidance surprises investors during earnings season. The ASX's letter to the company and its response would later be published... Read more

Iron ore price surges, nears $US60... Read more

Iron ore juniors get breathing space. Iron ore's unexpectedly strong price rally has given valuable breathing space to the State's mid-tier producers. The steel-making ingredient added another 5.5 per cent to $US57.81 a tonne late on Friday to take its gain since bottoming at $US47.08 on April 2 to 23 per cent... Read more

King River Copper received a speeding ticket from the ASX for a share price rise from $0.026 on Thursday, 23 April 2015, to an intra-day high of $0.04 today. Trading volume had also increased... Read more

BHP Billiton has been hit with a $522 million tax bill that could rise well beyond that over the use of its Singapore office to shift profits. The mining giant, Australia's largest taxpayer and company by market value, has vowed to contest the Tax Office's bill even though investigations into the alleged use of BHP's Singapore marketing hub are continuing... Read more

Adani Mining feels heat over $14b Galilee Basin coal mine gap. Can you trust a company to run a clean and profitable coal mine when its financial controller has a case of the vagues?... Read more

Low oil prices were good news for Caltex's refining business in March when margins more than tripled. The refining business's importance to Caltex in relation to distributing and retailing was significantly reduced with the closure of its Sydney refinery in 2014... Read more

Haulage contractor McAleese has extended the voluntary suspension of its shares as it continues talks with its troubled client, Atlas Iron.... Read more

Gold and copper miner PanAust has urged shareholders to reject an "opportunistic" $1.1 billion takeover offer from a Chinese-state owned company. Accounting giant Ernst & Young says Guandong Rising Asset Management's $1.71-a-share offer for PanAust is "neither fair nor reasonable" and has assessed the company to be worth between $1.84 and $2.04 a share... Read more

Online sportswear retailer SurfStitch has lifted its earnings guidance for the year after wrapping up early a restructure of its European business... Read more

Shares in technology group Hills have dropped more than 16 per cent after it lowered its full year profit guidance by up to 40 per cent... Read more

Voyager Global Group is giving investors more time to acquire up to $6.5 million worth of shares priced at $0.11 under a capital raising to satisfy ASX requirements for re-listing. On 20th March 2015, the company invited applications for up to 59.1 million shares under a prospectus. This has now being extended to Friday, 15th May 2015... Read more

Generation Healthcare on acquisition trail... Read more

NBN is costing us millions, says councils. Thousands of jobs and millions of dollars in benefits across Australia have been lost because of NBN Co's decision to target residential areas instead of businesses, according to a new study into the $41 billion national broadband network... Read more

M2 makes $1.6bn play for iiNet... Read more

M2 pledges to keep iiNet brand alive. M2 CEO Geoff Horth has promised to maintain the iiNet brand as a standalone operation and preserve its much-touted customer advocacy should its $1.6 billion offer for the company be accepted. The ISP today made a play for its rival following TPG's March all-cash offer to take over iiNet for $1.4 billion... Read more

An expensive battle for second place is underway in Australia's booming telecommunications sector, with Dodo owner M2 Group attempting to scuttle TPG Telecom's planned takeover of iiNet.... Read more

Cogstate Limited clinches US$4.9M in cognitive test contracts... Read more

Metcash orders impacted as storms damage distribution centre... Read more

The Victorian Government will spend $12 million over the next 10 years on a deal it says will ensure passenger services continue at Avalon Airport, near Geelong. Jetstar is the only commercial airline that uses the airport and it operates five passenger flights a day to Sydney... Read more

Users of mobile payments start-up ingogo will be able to directly send their taxi claims to their workplace thanks to an alliance with business travel and expense management player Concur... Read more

Young Social Pioneers: Nation's brightest selected for mentorship, chance at $10,000 grant for tech start-up... Read more

Mining magnate Gina Rinehart's estranged daughter has admitted claims she made about her mother withholding access to a deed were not true but says "it wasn't a lie I was making intentionally".... Read more

ACCC boss Rod Sims rejects supermarket claims effects test will hurt shoppers... Read more

Analysis - Stephen Letts: Big four banks set to continue upward profit grind ... for now... Read more

Opinion - Ian Verrander: Hockey might need to flip his budget thinking. A fortnight out from the federal budget - and with last year's effort still in tatters - the storm clouds are looming and a choice needs to be made about how to cope... Read more

International Headlines

U.S. Market Report: U.S. stocks fell as declines in biotechnology companies overshadowed a rally in commodities stocks before Apple Inc.’s results. The Standard & Poor’s 500 Index slipped 0.2 percent to 2,113.14 at 2:12 p.m. in New York, after earlier rising as much as 0.4 percent. The Dow Jones Industrial Average fell 7.10 points, or less than 0.1 percent, to 18,073.04. The Nasdaq Composite Index declined 0.6 percent.... Read more

North/South Americas Market Report: Markets were lower across the region as of the most recent closing prices... Read more

European Market Report: European markets finished broadly higher today with shares in Germany leading the region. The DAX is up 1.93% while France's CAC 40 is up 1.30% and London's FTSE 100 is up 0.47%... Read more

Asian Market Report: Asian markets finished mixed as of the most recent closing prices. The Shanghai Composite gained 3.04% and the Hang Seng rose 1.35%. The Nikkei 225 lost 0.18%... Read more

Oil prices turned lower in Asia Monday but losses were limited as continued fighting in Yemen fuelled fears about a supply disruption in the Middle East, analysts said. US benchmark West Texas Intermediate fell 11 cents to $57.04 while Brent crude declined two cents to $65.26 in afternoon trade.... Read more

Oil price hovers at four-month high... Read more

Americans Aren't Miserable Enough for the Bull Market in Stocks to End... Read more

Richard Branson slams Yahoo's work from home ban as 'a mistake'. Unless you have a technical job like flying an airplane, you can probably do it from home, Richard Branson says. Companies that forbid the practice, such as Yahoo, put pressure on families and limit opportunities for women, according to the Virgin Group founder.... Read more

Google Inc said it would launch an experimental portal that allows interested patent holders to sell their patents to the company.... Read more

Here’s how much Apple earns more than everyone else. The iPhone maker earned a staggering $18 billion over the holiday quarter... Read more

The drug maker Mylan on Monday pointedly rejected a $40 billion takeover bid from an Israeli competitor, Teva, setting up a potentially drawn-out battle between the two. The widely expected move sets up three-way battle among global pharmaceutical companies specializing in generic brand drugs. Mylan, which is incorporated in the Netherlands, is pursuing a roughly $33 billion takeover bid for Irish competitor Perrigo that so far has also been rejected... Read more

Chipotle has gone GMO-free.. That means none of the ingredients will be genetically modified -- for its tortillas, rice, chips and salsa, and also in the marinades used to cook its meats... Read more

Pepsi to drop artificial sweetener aspartame... Read more

Greece Says It Is Changing Team That Negotiates With Creditors. The Greek government on Monday announced a shake-up of its team negotiating with international creditors after the country’s finance minister, Yanis Varoufakis, came under fierce criticism from his eurozone peers last week over a lack of progress in the talks... Read more

Leading English rugby union club Wasps is launching a seven-year bond as it looks to raise between £25m and £35m. The bonds will pay a fixed gross rate of interest of 6.50% a year until 2022. Interest will be paid semi-annually... Read more

The British government has warned oil giant BP that it would oppose a foreign takeover of the company weakened in recent years by the Gulf of Mexico oil spill, media reports say. "The government has met with BP in recent days to express its opposition to any potential takeover of the oil major," the Daily Telegraph reported on Monday... Read more

Spain to lift its economic growth target for 2015... Read more

Shares in Germany's Deutsche Bank have fallen after it unveiled a plan to cut costs by €3.5bn (£2.5bn) and sell off its Postbank business. Shares fell by 4.6% to €30.13 as investors said they wanted more detail. The bank will close up to 200 High Street branches by 2017 and leave or reduce its presence in some countries... Read more

Investors question Deutsche Bank's overhaul. Deutsche Bank's biggest strategic overhaul under co-chief executives Anshu Jain and Juergen Fitschen got a thumbs down from investors on Monday who judged it too little too late.... Read more

Russia and China to help small and medium-sized businesses find partners. Moscow and Beijing have sent a clear signal of support to small and medium-sized enterprises. At a recent Russian-Chinese forum, the parties agreed to establish a system to allow companies to search for business partners. Furthermore, an exhibition platform for Russian goods is to be established in Harbin, in northern China... Read more

Economic crisis hits at heart of Russia's pride: Its space program... Read more

Eurasian Union would make a good partner for ASEAN. The early completion of a free trade agreement between Vietnam and the Eurasian Economic Union could pave the way for greater economic engagement between the union and the ASEAN Economic Community... Read more

China has become the second-largest wine-growing area in the world after Spain, pushing France into third place. The International Organisation of Vine and Wine (IOVW) said China now had 799,000 hectares (1.97 million acres) of land devoted to wine growing, That compared with 1.02 million hectares for the biggest wine-growing area of Spain... Read more

A senior executive at state energy firm China Sinopec Group is under investigation for suspected "serious disciplinary violations". The China Central Commission for Discipline Inspection (CCDI) named Wang Tianpu, an oil industry veteran and president of Sinopec Group, in a statement on its website... Read more

China will likely cut the number of its central government-owned conglomerates to 40 through a series of mergers, as Beijing pushes forward a plan to overhaul the country's underperforming state sector, state media reported on Monday... Read more

Obama, Abe eye strategic trade deal at White House. President Barack Obama will seek to encourage the emergence of a more assertive Japan and close in on a major Pacific trade deal when he hosts Prime Minister Shinzo Abe at the White House Tuesday... Read more

Fitch has cut its credit rating on heavily indebted Japan by one notch, saying the country has not done enough to plug a budget gap left by its decision to delay a sales tax rise. Fitch trimmed Japan's rating to "A" from "A+", several months after rival credit agency Moody's also downgraded Japan's credit rating.... Read more

‘No One’s Going Back’: Everest Industry Shut for a Second Year... Read more

Opinion/Analysis - Cody Willard: How to play Apple stock after the earnings call... Read more

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