ASB Securities Morning Brief for Friday, 05 February 2016
Friday, 05 February 2016

New Zealand Headlines

New Zealand Market Report: New Zealand shares rose in an absence of corporate news ahead of earnings season. Steel & Tube Holdings and Westpac Banking Corp led the advance while Z Energy and Skellerup Holdings dropped. The S&P/NZX 50 Index rose 4.3 points, or 0.1 percent, to 6,137.7. Within the index, 23 stocks fell, 18 rose and nine were unchanged. Turnover was $127 million... Read more

The New Zealand dollar traded near a month-high as stronger headline labour market data and signals from Reserve Bank governor Graeme Wheeler that he won't rush to cut interest rates trumped weaker prices at this week's dairy products auction. The kiwi traded at 66.67 US cents at 5pm in Wellington, from 65.39 cents yesterday. Earlier today it touched 66.97 cents. The trade-weighted index gained to 72.63 from 71.99 yesterday... Read more

NZX metrics: cash market trades rise 45% in January, value of equity trades slips 1.1%... Read more

RBNZ Assistant Governor says the bank's wholesale interest rate forecasts should not be taken as a commitment to a specific set of actions... Read more

RBNZ's Toby Fiennes argues deposit insurance would blunt incentives for banks and depositors to monitor and manage risks properly... Read more

Auckland house prices have fallen since December – although sales remain strong, the city’s biggest real estate agency has revealed... Read more

Auckland's house sales volumes jump to eight-year high in January, Barfoot says... Read more

Yield Indicator report show prices rising more quickly than rents in most places but prices and rents both falling in Christchurch... Read more

Lawyers are objecting to a planned tax law reform, saying it could stop overseas land and apartment developers working in the housing-starved Auckland market... Read more

Investors in Australia and New Zealand are being offered a new way to invest in global equity markets.... Read more

Twelve nations formally sign Trade Pacific Partnership Agreement in Auckland, ratification will take longer... Read more

A landmark anti-money laundering dispute between a foreign exchange dealer and Kiwibank finally began in the High Court at Auckland this week. NBR court reporter Hamish McNicol says proceedings were first started last March after the bank told money remitter E-Trans International Finance it was closing its bank accounts because of anti-money laundering concerns... Read more

Wine export industry set to skyrocket under TPP. The Government says the Trans-Pacific Partnership (TPP) deal will save wine producers $10 million a year in tariffs, in an export industry that's set to be worth $2 billion a year within four years.... Read more

The main benefit for the deer industry from the Trans-Pacific Partnership (TPP) agreement will be the ability to challenge any potentially unfair regulations imposed by importing countries.... Read more

Fonterra's Beingmate JV to start China exports this year... Read more

The stoush between New Zealand Honey International and the Ministry for Primary Industries (MPI) over labelling has reached the Court of Appeal. New Zealand Honey is appealing a High Court ruling in November that found its trademarks, Manuka Doctor and Manuka Pharma, amount to health claims and cannot be used on the company's products... Read more

The Meat Industry Excellence (MIE) ginger group is pressing on with attempts to reform the meat processing industry. New chairman Dave McGaveston said the group had submitted two remits for the March 23 AGM of Beef + Lamb New Zealand... Read more

The government has released a 10-year plan to attract investors and lift economic growth in Northland, a region that perennially underperforms the rest of the country even while being endowed with natural beauty, productive land, minerals, a potential workforce, scope for manufacturing, forestry and aquaculture, and proximity to Auckland... Read more

Turners auction group is benefiting from strong New Zealand and overseas demand for trucks and machinery. The country's second largest vehicle retailer has spent $7 million on new dedicated truck and machinery sales sites in Auckland and Christchurch.... Read more

Air New Zealand has announced it will spend more than $25 million on a partnership with an European aircraft manufacturer to equip its 68-seat turboprop fleet with advanced required navigation performance technology... Read more

P&O’s Pacific Pearl Cruises into Auckland to launch record cruise season and begin influx of Auckland Nines fans. New Zealand’s burgeoning cruise industry is set to receive a huge boost with the arrival of P&O Cruises’ Pacific Pearl into Auckland today for the launch of the cruise line’s biggest ever New Zealand season, lasting a record five months... Read more

Consumers given right to request consumption data from power retailers... Read more

Dick Smith employees in Australia underpaid by A$2 mln, Kiwi staff unaffected... Read more

McDonald's is promising to cut the amount of sugar, fat and salt in its fast food. But managing director Patrick Wilson said its research clearly showed Kiwis did "not want to be told what to drink, or have options taken away". Wilson acknowledged the amount of sugar in foods had come "increasingly under the spotlight" over the past few years... Read more

Air New Zealand appoints new Chief People Officer... Read more

Aotearoa Fisheries Limited is making changes to its appointed directors to Sealord Group Limited in order to have a complete alignment of its appointees with its own board. Aotearoa Fisheries owns 50% of Sealord on behalf of all Māori, and as such appoints half of the Sealord board of directors... Read more

Broadband, eftpos problems in lower NI after cable damaged... Read more

Conservation Minister Maggie Barry has confirmed her officials are talking to the crowdfunders seeking to buy a beach at Awaroa in Abel Tasman National Park at the top of the South Island... Read more

Opinion - Jacqueline Rowarth: Research backs a reduction in Fonterra's board size... Read more

Opinion - Janine Starks: Hanging in through market shift will pay off. How many times have I biffed the business pages towards the ocean this summer? Several, is the answer. January 2016. The sun was out in force, the winds were gentle and you quietly turn the page of a newspaper in a deck chair. Boom the storm hits. If Dan Corbett had to present a market report his arms would fly off his body... Read more

Opinion - Fran O'Sullivan: China looms large at TPP... Read more

Opinion - Andrew Hoggard: Milk price and trade closely linked... Read more





Australian Headlines

Australian Market Report: The Australian share market has closed around two per cent higher in the wake of a strong rise in oil prices and the hope that weak US economic data will slow the pace of interest rate hikes in the US... Read more

Local currency lifts on combined commodity rises, US dollar falls. The Australian dollar has risen against all major currencies as commodity prices rise and traders ditch the greenback in droves. At 1700 AEDT on Thursday, the local currency was trading at 71.72 US cents, up from 70.21 US cents on Wednesday.... Read more

Aussie Gold within sight of A$1600 an ounce... Read more

Sydney apartments in the middle ring are outstripping demand in the city... Read more

Petsec Energy is preparing to reveal details of an acquisition, with the ASX granting the company a trading halt to prepare.... Read more

Magnate takes more than three years to declare directorship of Queensland resort. Clive Palmer has taken more than three years to declare his directorship of a Queensland resort.... Read more

Shares in Fortescue Metals Group jumped after the miner noted that Standard and Poor’s had affirmed its credit ratings. The ratings agency, which this week lowered BHP Billiton’s credit rating and put Rio Tinto on a negative watch, reaffirmed FMG’s Corporate Family Rating at “BB” with a negative outlook. Shares in FMG were up 19 cents, or 11.73 per cent, to $1.81 at the close.... Read more

AGL Energy is quitting its gas exploration and production activities due to the collapse in oil and gas prices... Read more

AGL’s makes shock exit from Australian CSG market, Gloucester project to be scrapped... Read more

Tanga Resources shares have been trading higher recently, with the company last changing hands at $0.054, after hitting $0.08 in January... Read more

Gold producer Doray Minerals and gold explorer Burey Gold have experienced solid gains after revealing encouraging drilling results. The pair also benefitted from the gold price surging to a three-month high overnight. Gold was trading at $US1141 an ounce at 12.45pm.... Read more

Waratah Resources sets sail for technology investment. Waratah Resources continues its renaissance signing a binding agreement with Tulla Technology to find a technology investment... Read more

Brookfield Infrastructure has signalled it is prepared to consider an all-cash offer for Asciano to try to secure a $9 billion takeover of the ports and rail group. Asciano's board has already accepted a cash-and-stock bid from Brookfield, but is considering a slightly higher rival offer from a consortium led by logistics group Qube... Read more

Platypus Minerals in cash raiser for lithium due diligence... Read more

South32 has warned of job losses at its Worsley alumina operation in the South West after announcing big staffing cuts at its South African manganese operation and flagging a writedown of $US1.7 billion. Investors welcomed news of the job cuts, sending South32 shares up 13.5 cents, or 14.21 per cent, to $1.085 at the close.... Read more

One off costs - including defending alleged breaches of anti-money laundering and counter-terrorism financing laws - have dragged down the profits of gambling business Tabcorp. Tabcorp reported a first-half profit of $81.9 million, down 33 per cent on the prior corresponding period.... Read more

Virgin Australia posts second consecutive year-on-year quarterly profit, lifts unit revenue and yield. Virgin Australia has consolidated its first-quarter return to profit by lodging another quarterly profit today... Read more

Investors have savaged contracting company Programmed’s share price after it lowered earnings expectations by 10 per cent because of the oil and gas slump... Read more

Telecommunications company Flexiroam has accelerated its growth trajectory in recent weeks with a string of milestones setting up a potential for significant expansions in 2016... Read more

Engineering group Downer EDI has trimmed its full year profit guidance after posting a nearly 24 per cent drop in first half profit. The company now expects to report net profit of around $180 million in fiscal 2016, down from its previous target of $190 million. Downer shares were up 26 cents or 8.81 per cent at $3.21 each.... Read more

Immuron has received $1,469,763 in a cash refund from a Research & Development programs during 2015 in the form of tax concessions.... Read more

Dick Smith 'has been underpaying workers'. The receiver restructuring Dick Smith with a view to selling the troubled electrical retailer says the company has been underpaying workers for as long as six years.... Read more

The suspected underpayment of Dick Smith staff dates back to Woolworths' ownership of the electronics chain before the business was bought by private equity and sold to investors through a $520 million public float... Read more

Australian companies 'open to cyber crime'... Read more

Union representing Coles workers knew some would be worse off under wage agreement, commission hears... Read more

Real Insurance owner Greenstone to stay private... Read more

CBA staff in alleged fraud: report. Two employees to face court after allegedly masterminding a $76m Ponzi scheme.... Read more

APA Group’s WA general manager Steve Noske faces a committal hearing on insider trading charges in March after a hearing yesterday was adjourned... Read more

Telstra Wholesale group executive Stuart Lee will leave his role at the end of March after almost 45 years with the telco. Lee first joined the Postmaster-General’s Department, a predecessor of Telstra, in 1971 as a cadet engineer... Read more

Customers have been warned against eating prepacked lettuce and spinach sold at Coles and Woolworths across the nation after an outbreak of salmonella. The lettuce, grown and distributed by the Victorian company Tripod Farmers, has been linked to at least 28 cases of salmonella... Read more

Opinion/Analysis - David Walker: What should NAB shareholders do with their Clydesdale stock?... Read more

Opinion - Michael Pascoe: Business driving ahead despite market jitters... Read more

Opinion/Analysis - Florence Chong: Australia’s fertile ground spawns a childcare boom. With a volatile sharemarket, minuscule deposit rates, and looming apartment oversupply in key capital cities, childcare centres have emerged as something of an investment haven. Routinely, when a childcare centre comes onto the market in what is considered a ‘good location’ in a major capital city, it can now attract up to 60 buyer inquiries... Read more

Opinion/Analysis - Joe Weisenthal: Goldman Sachs forced to fundamentally question how capitalism is working... Read more





International Headlines

U.S. Market Report: U.S. stocks fluctuated, as commodities from copper to gold advanced amid a slide in the dollar fueled by speculation global growth may not be strong enough to warrant further central-bank tightening. Crude erased its advance back below $33 a barrel... Read more

North/South Americas Market Report: North and South American markets are broadly higher today with shares in Brazil leading the region. The Bovespa is up 3.06% while Mexico's IPC is up 1.38% and U.S.'s S&P 500 is up 0.26%... Read more

European Market Report: European markets finished mixed as of the most recent closing prices. The FTSE 100 gained 1.06% and the CAC 40 rose 0.04%. The DAX lost 0.44%... Read more

Asian Market Report: Asian markets finished mixed as of the most recent closing prices. The Shanghai Composite gained 1.53% and the Hang Seng rose 1.01%. The Nikkei 225 lost 0.85%... Read more

America is pumping so much oil that it's running out of places to keep it all. The U.S. now has nearly 503 million barrels of commercial crude oil stockpiled, the Energy Information Administration said on Wednesday. It's the highest level of supply for this time of the year in at least 80 years... Read more

Desperate Venezuela lobbies hard for oil supply cut... Read more

Spot gold price gains 0.4% in European trade as market eyes delay to further US rate hikes. Gold prices were higher on the London spot market Thursday as weak US data stoked expectations of a delay in further interest rate increases by the Federal Reserve... Read more

January brought snow and pink slips for many Americans. Job cuts soared 218% in January, according to career placement firm Challenger, Gray & Christmas. Layoffs were particularly heavy for people working at energy and retail companies.... Read more

Mortgage rates keep falling, now at 9-month low... Read more

The controversial Trans-Pacific trade pact has been signed... Read more

Ugly earnings may mean a scary S&P 500 plunge — 20%, for starters... Read more

Former pharmaceutical executive Martin Shkreli suffered a roughly $40 million drop in the value of a trading account used to secure his bail following his arrest on securities fraud charges, a U.S. prosecutor said on Wednesday. At a hearing in federal court in Brooklyn, Assistant U.S. Attorney Winston Paes said the account contained mostly shares of KaloBios Pharmaceuticals Inc KBIOQ.PK, a drug company that Shkreli briefly ran... Read more

Shkreli laughs off questions from lawmakers, calls them 'imbeciles'... Read more

A jury has ordered Apple to pay $626 million in damages after finding that iMessage, FaceTime and other Apple software infringed on another company's patents. In a case that has been bouncing around the court system since 2012, VirnetX accused Apple of violating four of its patents, which mostly involve methods for real-time communications over the Internet... Read more

Wal-Mart to operate its own gas stations... Read more

Layoffs, new cameras and a strategy shift. Nothing seems to be working for GoPro, which has plummeted to yet another all-time low. After posting a huge loss last quarter, the company fired its chief financial officer and slashed its product lineup to just three different cameras... Read more

Viacom's board appears poised to replace Sumner Redstone as chairman on Thursday, after the aging mogul stepped down from his executive role at the top of CBS, but it was not apparent who would get his job at Viacom as Redstone's daughter made clear she did not want CEO Philippe Dauman to succeed her father... Read more

Philip Morris International Inc.'s stock slumped 3.1% in premarket trade Thursday, after the cigarette seller missed fourth-quarter revenue expectations and provided a downbeat profit outlook for 2016... Read more

European Central Bank President Mario Draghi hit back at a warning from Germany's Bundesbank that the ECB shouldn't overreact to a sharp drop in oil prices, underlining his readiness to launch additional stimulus to shore up ultralow inflation... Read more

Bank of England cuts growth forecast... Read more

Greece's growth seen contracting at 0.7% in 2016, up from previous forecast of 1.3%.... Read more

A claim that charity Age UK has been promoting unfavourable gas and electricity deals in return for cash is to be examined by two regulators. The Sun newspaper said energy deals offered by Age UK with supplier E.On may have been much more expensive than the cheapest offers from the firm... Read more

House price growth in the UK increased to 9.7% in the year to January, up from 9.5% a month earlier, according to the Halifax. Britain's largest mortgage lender said the last time that figure was greater was in July 2014, when prices were rising by more than 10%. Prices increased by 1.7% between December and January... Read more

Credit Suisse shares crash to 24-year low... Read more

Credit Suisse has announced that it is going to cut 4,000 jobs. The announcement came with the release of results for 2015. The bank made a pre-tax loss for the year of 2.4bn Swiss francs ($2.4bn; £1.6bn), which was its first annual loss since 2008... Read more

A hearing into whether Navinder Sarao, the so-called "flash crash" day trader, can be extradited to the US has begun. Mr Sarao, who traded from his parents' home in Hounslow, west London, is accused of market manipulation that caused a 1,000-point fall on the US Dow Jones index in 2010... Read more

Energy giant's profit hit hard by collapse in oil prices. Royal Dutch Shell said fourth-quarter earnings tumbled 44 per cent as the collapse in oil prices took its toll on another European oil company... Read more

European Commission says job creation, oil prices, financing conditions will drive strong domestic consumption. The growth of Spain's economy is expected to slow but remain robust in 2016 as job creation, favorable financing conditions and low oil prices continue to drive strong domestic consumption, the European Commission said on Thursday... Read more

Russia’s latest anti-crisis plan: How will it work? The Russian government is making fresh attempts to lead the economy out of the crisis, primarily by investing in industry. RBTH analyzes the Kremlin’s latest anti-crisis plan and offers three alternative strategies for overcoming the crisis... Read more

Ukraine files lawsuit against construction of Nord Stream 2 gas pipeline. Ukraine has opened legal proceedings over the construction of the Nord Stream 2 gas pipeline from Russia to Germany, which will obviate the need to ship gas through Ukraine to the EU if it is built... Read more

Honda adds 2.2 million vehicles to Takata air bag recall... Read more

Sharp shares soared more than 25 percent in Tokyo Thursday following reports its board is favouring accepting a $5.0 billion bailout from Taiwanese giant Hon Hai Precision. The embattled Japanese electronics giant -- which has teetered on the edge of bankruptcy for years -- kicked off a critical directors' meeting Thursday morning to review competing bids, including a proposal from a domestic investment firm... Read more

Popular tourist hotspots in the Americas are poised for trouble as the Zika virus threatens to scare away visitors. There is currently no vaccine or medicine to treat Zika, a mosquito-borne virus that has spread across roughly 30 countries and territories in the Americas... Read more

Tata Steel Swings to Third-Quarter Loss as Imports Hurt Margins... Read more

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