ASB Securities Morning Brief for Friday, 26 June 2015
Friday, 26 June 2015

New Zealand Headlines

New Zealand Market Report: New Zealand shares fell as traders weighed whether a regulatory threat was returning to the energy sector. MightyRiverPower, Genesis Energy, Meridian Energy and Contact Energy declined. A2 Milk Company fell as investors looked to crystalise recent gains. The S&P/ASX 50 Index fell 42.2 points, or 0.7 percent, to 5733.29. Within the index, 27 stocks fell, 15 rose and eight were unchanged. Turnover was $196 million.... Read more

The New Zealand dollar extended its recovery from a five-year low against a backdrop of increasingly investor concern about the negotiations between Greece and its international creditors. The kiwi rose to 69.15 US cents at 5pm in Wellington from 68.86 cents at 8am and 68.53 cents yesterday. It advanced to 61.70 euro cents from 61.32 cents yesterday.... Read more

The Reserve Bank has been told to stick to its knitting by the Treasury, with officials warning that rules on mortgage borrowing need to be within its mandate. In documents released on Thursday evening, Treasury officials also warned that the original loan to value restrictions put in place by the Reserve Bank may have led to more activity by property investors. It follows numerous claims that the rules have hurt first time buyers... Read more

The chances of the Trans-Pacific Partnership being finished are now about 70 per cent, says Trade Negotiations Minister Tim Groser after President Barack Obama cleared the last hurdle in the Congress to fast-track the free trade deal among 12 Pacific rim countries... Read more

TPP agreement will undermine NZ state-owned enterprises, critic warns... Read more

Low-deposit loans bounce back as banks loosen purse strings. Things are looking up for home-hunters who can't afford a 20 per cent deposit, as banks increasingly relax their purse strings. Reserve Bank figures show banks loaned $484 million to low-deposit borrowers in May, up from $390m in April.... Read more

Real estate agents told to better explain how multi-offers work.... Read more

Don’t under estimate the IRD. Property investors beware: Inland Revenue has the investigative powers to track down and nab deliberate or inadvertent tax evaders – and they will use them forcefully.... Read more

Big rates bills on the way for Aucklanders... Read more

Will rates increases add impetus to Auckland’s rising rents?... Read more

The government may have to provide voluntary annuities to KiwiSavers. The Government may have to go into the business of providing "voluntary" annuities, a new report has suggests. Income Streaming in Retirement by the New Zealand Society of Actuaries (NZSA) outlines the options KiwiSavers should have for turning their nest eggs into retirement income... Read more

Dairy farmers have flocked to Fonterra's guaranteed milk price scheme, with many opting to lock in farmgate prices at $5.25 a kg of milksolids - the same price as its forecast for 2015/16... Read more

Federated Farmers Bees, Honey Packers' and Exporters' Association, and National Beekeepers' Association have all voted to proceed with plans to create a single national body for the apiculture industry.... Read more

Wool Generally Holds Its Ground. New Zealand Wool Services International Limited’s General Manager, Mr John Dawson reports that the combined North and South Island auction comprising 20,585 bales saw a 91 percent clearance and a generally firm market except for the previously over pressured Fine Crossbred types which eased slightly... Read more

Green alternatives to fracking have been presented as way to ensure the oil and gas industry's viability into the future. The new technologies being trialled were exhibited and discussed at the Enex New Zealand Hard Hat Oil and Gas conference held In New Plymouth on Wednesday and Thursday... Read more

Vital Healthcare Property Trust, the listed hospital developer, has announced a A$14.5 million project for its South Eastern Private Hospital in Melbourne, and is expanding its land base in Newcastle. Vital shares were unchanged at $1.635. ... Read more

The equity crowdfunding campaign for loyalty scheme software provider Collect has reached its goal after just three days . The capital raise for Wellington-based software startup Collect has reached its $200,000 minimum raise through its offer on New Zealand’s newest crowdfunding platform Crowdcube, which is managed in New Zealand by investment bank Armillary Private Capital... Read more

Independent Liquor (NZ), the company owned by Japan's Asahi Group, wrote off its remaining goodwill, partly offsetting gains from a multi-million-dollar settlement with the former private equity owners over the price paid for the booze empire. The Papakura-based company founded by the late Michael Erceg reported a loss of $52.6 million in calendar 2014 compared with a loss of $41.6 million a year earlier, according to financial statements lodged with the Companies Office... Read more

Precinct sells another Wellington building for $76m; portfolio value increases... Read more

Ports of Auckland accepts High Court decision. Tony Gibson, CEO of Ports of Auckland, has today said that the company will not appeal the recent High Court decision which revoked resource consent for the Bledisloe wharf extensions... Read more

Broadband customers who signed up for Global Mode to watch overseas content online will be allowed out of their contracts penalty-free. CallPlus, which owns Orcon, Slingshot and Flip broadband, reached a deal with a group comprised of Sky Television, Television New Zealand, Mediaworks and Spark's Lightbox on Wednesday to drop Global Mode from their offerings... Read more

The country's tourism cheerleader is at odds with hoteliers over how to view the popular Airbnb lodging website. Airbnb plans to open its first New Zealand office and claims to have doubled its listings here over the past 12 months... Read more

Christchurch-Taiwan service should reduce trans-Tasman fares... Read more

Churn debate: Underinsurance the issue, not commissions. Kepa group chief executive Jeff Page says the Financial Markets Authority should step in and set some rules around churn. Page says the life insurance industry should sort the problem out itself but it has shown that it hasn’t been able to do so... Read more

Shanton clothing chain goes into liquidation... Read more

The chief executive of the Canterbury Earthquake Recovery Authority has made a revised offer to the group known as Quake Outcasts. The new offer appears to be an improvement on the previous 50% offer... Read more

Opinion - David Chaplin: KiwiSaver turn-off high in kickstart-less world. Sign-ups have dropped by more than half following the $1,000 kickstart deletion last month, the nation's biggest KiwiSaver provider, ANZ, reported this week... Read more

Opinion - Greg Harris: Inland Revenue scores court victory over TrustPower... Read more

Opinion - Fran O'Sullivan: Is NZ ready for $10b of Chinese cash about to drop on property market... Read more

Australian Headlines

Australian Market Report: Fresh fears over Greece's bailout negotiations saw foreign stocks fall overnight, weighing on the local sharemarket at noon. At 12.05pm (AEST), the benchmark S&P/ASX200 index was down 38 points, or 0.67 per cent, to 5,648.8, while the broader All Ordinaries index gave up 37.3 points, or 0.66 per cent, to 5,635.4.... Read more

The Australian dollar has gained some ground to close flat after falling on renewed concern about Greece's debt crisis. At 1700 AEST on Thursday, the local unit was trading at 77.30 US cents, up from 77.27 cents on Wednesday. In overnight trade, the Aussie dipped to 76.83 US cents before ticking up on Thursday morning... Read more

Consumers are growing more anxious but this time it's not the government's fault. Worries about job security and the cost of living are overshadowing a positive response to this year's business-friendly federal budget. National Australia Bank's consumer anxiety index rose 1.7 points to 63.5 points in the June quarter, with anxiety up in all categories except government policy.... Read more

Commonwealth Bank lowers assessment rate for home loan customers... Read more

The Federal Government's decision to join China's Asian Infrastructure Investment Bank will boost the country's leadership credentials in the Asia-Pacific region, according to analysts. Treasurer Joe Hockey announced Australia would become a founding member of the bank, investing $930 million into the bank over the next five years, making it the sixth largest shareholder... Read more

Superannuation funds face a major shake-up in their corporate governance under controversial reforms announced by the Federal Government today. Under draft legislation to be released, superannuation funds will be required to have an independent chairman, and independent directors will need to comprise at least a third of a fund's board... Read more

Australia’s great tax myths. We all know that taxes are a fact of life. But figuring out what we can deduct and how those deductions or tax breaks work can be hard. This is partly due to the ever changing guidelines around taxation, but also it stems from the fact that for a lot of us being fluent in tax is about as challenging as speaking another language... Read more

Union and employer representatives will have to cede some of their seats on the boards of industry super funds under rules that will require one-third of the directors of each fund and the board chairman to be independent. The rules will apply to every fund other than self-managed funds... Read more

The fortunes of mining services group Bradken could be boosted if a reported recapitalisation plan goes ahead. Shares in Bradken were yesterday placed in a trading halt amid speculation about a potential recapitalisation plan to provide a cash injection for the troubled company... Read more

Mining contractor Macmahon Holdings says it is cash positive after extricating itself from a troubled contract in Mongolia through a $US65 million ($84 million) sale. Macmahon shares closed up 2.2¢, or 48 per cent, to 6.8¢.... Read more

Energy Ventures is readying to reveal details of a capital raising, with the ASX granting the company a trading halt to prepare.... Read more

MMA Offshore has won a marine services contract for Chevron’s North West operations worth up to $100 million. The contractor’s shares closed up 3.5¢, or 6 per cent, to 59¢.... Read more

Ventnor Resources gears up for equity raise... Read more

Norton Goldfields managing director Dianmin Chen will leave the company and it will move its headquarters from Perth to Kalgoorlie by the end of the year... Read more

About 140 jobs at BHP Billiton in Adelaide are set to go amid warnings more will follow in the wake of crashing commodity prices... Read more

Orocobre Limited has been granted an ASX trading halt in relation to a proposed capital raising through a placement of shares to sophisticated investors... Read more

Gina Rinehart has asked her employees to accept pay cuts as the lower iron ore price and high costs continue to take a bite out of the viability of her $10 billion Roy Hill project in the Pilbara... Read more

Rinehart backs India's cuts to red tape... Read more

My Net Fone to raise capital through share placement... Read more

Slater and Gordon has suffered its worst share price slump as UK authorities probe the accounts of a company it recently bought a slice of for $1.2 billion. Shares in UK-listed insurance technology group Quindell have been suspended as the country's Financial Conduct Authority launched an inquiry into public statements about its 2013 and 2014 financial accounts... Read more

Fruit and vegetable king Frank Costa is seeking to raise close to $640 million in one of the largest company listings of the year. The Costa Group, the nation’s largest grower, packer and seller of fresh fruit and vegetables, has set a $2.20 to $2.70 price range on its shares in its initial public offering.... Read more

Paradigm Biopharmaceuticals seeks to repurposes existing approved drugs for new therapeutic applications and is raising up to $8 million through an initial public offering priced at $0.35 to support its expenditure program. The minimum subscription of $5 million is underwritten by Lodge Corporate Pty Ltd... Read more

Property developer Mirvac is cutting more than 75 jobs as it simplifies its business to deliver up to $15 million in annual savings... Read more

Australia’s second largest mobile network provider Optus has failed to secure any funding to build new mobile towers in regional blackspots under a $385 million infrastructure program co-funded by the Commonwealth, states and telcos... Read more

Woolworths report card - plenty of room for improvement... Read more

Sizzler, the once popular all-you-can eat family restaurant chain, has lost its sizzle. Its owner Collins Foods says it won’t be investing in the chain any more and will close a number of restaurants after deciding Sizzler was no longer a key part of the company’s future... Read more

National Party senator John Williams has launched a stinging attack on IOOF, outlining evidence of insider trading and other financial misconduct... Read more

Opinion - Nassim Khadem: Why the United States hates Britain and Australia's 'Google tax'... Read more

International Headlines

U.S. Market Report: U.S. stocks struggled to hold on to modest gains, paring them by afternoon on Thursday as investors continued to monitor developments in Greece debt talks. The S&P 500 was up a point at 2,110. The Dow Jones Industrial Average was flat at 17,966. The Nasdaq Composite was 4 points, or 0.1% higher to 5,129... Read more

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

European Market Report: European markets finished mixed as of the most recent closing prices. The DAX gained 0.02%, while the FTSE 100 led the CAC 40 lower. They fell 0.54% and 0.07% respectively... Read more

Asian Market Report: Asian markets finished broadly lower today with shares in China leading the region. The Shanghai Composite is down 3.46% while Hong Kong's Hang Seng is off 0.95% and Japan's Nikkei 225 is lower by 0.46%... Read more

Oil prices were mixed in Asia on Thursday following a bearish US energy report, while talks over crude producer Iran's nuclear programme dragged on, analysts said. US benchmark West Texas Intermediate for August delivery fell nine cents to $60.18 while Brent gained one cent to $63.50 in afternoon trade... Read more

Robust U.S. consumer spending buoys economic growth outlook. U.S. consumer spending recorded its largest increase in nearly six years in May on strong demand for automobiles and other big-ticket items, further evidence that economic growth was accelerating in the second quarter... Read more

Univision dumps Trump, cancels Miss USA over his comments about Mexicans... Read more

Stop freaking out about stocks, says bubble savant Grantham... Read more

The U.S. Supreme Court preserved President Barack Obama's signature healthcare law on Thursday, upholding crucial tax subsidies while turning aside a conservative legal challenge that could have doomed the law... Read more

GM sees more profit from new Chevrolet models... Read more

With the race to control mobility in the workplace heating up, Apple Inc. and IBM Corp. are betting their niche, at times specially-designed, apps entice more companies to deploy their hardware and software over their competitors.... Read more

Greece bailout talks break down again... Read more

Greece has 5 days to avoid default. Greece could default in five days. That's the reality facing the indebted country after another inconclusive round of talks with creditors. Four months since Europe promised Greece more bailout loans in return for an acceptable program of economic reform, there is still no agreement... Read more

British Prime Minister David Cameron hopes to push forward his demands for a changed relationship with the European Union at a summit in Brussels starting on Thursday, his first official opportunity to jointly discuss his objectives since he was elected for a second term in office last month... Read more

Premium bonds to be pulled from post offices. National Savings & Investments says premium bonds will stop being available in post offices from 31 July. Savers will no longer be able to buy premium bonds in branches of the Post Office after July, National Savings & Investments announced on Thursday... Read more

The government says it will delay or cut back a number of modernisation projects planned for Network Rail. Transport Secretary Patrick McLoughlin says rising costs and missed targets make the £38.5bn plan untenable... Read more

Meet Denmark’s ‘Iron Lady’, who could cost Google $6.6 billion. She’s been called the “Goblin under Google’s bed”, and her actions could force big U.S. companies to pay billions of dollars in fines. She’s Margrethe Vestager, the EU’s new competition commissioner, who is living up to her nickname “The Iron Lady of Denmark” by taking on industry giants such as Google Starbucks and Amazon... Read more

Business opportunities move Russia-Asia cooperation forward. Russia's Asian Pivot is as much about economics as it is about politics. Although trade and investments between Russia and ASEAN countries are well below potential, there are several important projects in the pipeline... Read more

Brazil's unemployment rates rises... Read more

South Korea on Thursday announced a $14 billion stimulus package to boost its troubled economy, hammered by the deadly MERS outbreak which has dented consumer spending and business sentiment. In announcing the 15 trillion won programme -- which follows a central bank interest rate cut to a record low this month -- the finance ministry also slashed its growth outlook for this year... Read more

Toyota, Nissan expand air bag recalls after latest U.S. action... Read more

Microsoft Bets Big on India, Hoping to Contend in Global Smartphone Wars at Last. In most developed countries, the smartphone market is dominated by Samsung Electronics Ltd. and Apple Inc., but that is not the case in many emerging economies. The developing world’s cost conscious-consumer is not as enthralled with the market leaders, so often local names - Micromax Informatics Ltd. in India or Xiaomi Corp. in China for example – have the largest market shares... Read more

India Attracts Enough FDI to Join Global Top Ten... Read more

Analysis/Opinion - Ric Spooner: Why gold is losing its lustre... Read more

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