ASB Securities Morning Brief for Monday, 03 August 2015
Monday, 03 August 2015

New Zealand Headlines

New Zealand Market Report: New Zealand shares rose. Meridian Energy and MightyRiverPower gained ahead of a decision on the future of the Tiwai Point aluminium smelter and as investors sought companies with relatively strong dividend yields. The S&P/NZX 50 index rose 29.1 points, or 0.5%, to 5920.95. Within the index, 26 stock rose, 15 fell and 9 were unchanged. Turnover was $121 million... Read more

The New Zealand dollar fell after a survey showed deteriorating business confidence and may decline further with key event risks next week in the GlobalDairyTrade auction, labour market statistics and a Fonterra Cooperative Group board meeting. The kiwi dollar fell to 65.88USc as at 5pm in Wellington, from 66.39USc late yesterday.The trade-weighted index fell to 70.31 from 70.74.... Read more

New Zealand business confidence fell for a second month, to the most pessimistic in six years, led by the agricultural sector and construction companies. A net 15 percent of firms were pessimistic in July about the general economy over the year ahead, up from a net 2.3 percent in June, according to the ANZ Business Outlook survey... Read more

No TPP deal in Maui, but Groser 'extremely confident' of conclusion... Read more

TPP: Groser 'gobsmacked' by auto trade problem... Read more

Groser proves trade credentials by insisting on a good deal. The Dairy Companies Association of New Zealand (DCANZ) is commending New Zealand Trade Minister, Tim Groser, for standing firm against enormous pressure to concede to a sub-standard deal for dairy. The Minister and his team of expert negotiators have preserved the ability to conclude a good deal in the future... Read more

Dairy is in the doldrums and the stimulus from the Christchurch rebuild is fading but other parts of the economy are running hot. New Zealand's tourism sector is on track to overtake dairy as New Zealand's biggest export earner and the country will soon crack three million visitors a year... Read more

House price expectations highest since survey began in 1996... Read more

Some Aussie banks are offering lower fixed mortgage rates in New Zealand than they offer in Australia, even as their OCR is 1% lower across the ditch. Friday's surprise mortgage rate cuts by HSBC raises the question again about how the rates being offered in New Zealand compare with those offered in Australia, by basically the same banks... Read more

Property investor advocates slam claims that investors are to blame for Auckland’s super-hot housing market.... Read more

Real estate boss supports the call for a foreign buyers’ register. The call for a foreign buyers’ register is supported by Geoff Barnett, National Manager of Century 21 New Zealand.... Read more

Kiwi dream of bach ownership not about coining it... Read more

The purple patch for investors could be about to end looking at the results to June 2015, the latest available. Markets are becoming more volatile and KiwiSaver funds are recording negative returns over the last one to three months... Read more

The best-performing KiwiSaver funds were those that bet on the New Zealand dollar falling against foreign currencies in the three months to June 30, according to Morningstar. The research and ratings agency has released its latest survey on KiwiSaver funds and found currency had a big part to play in which funds had the highest returns... Read more

Hawke's Bay premium food producers have accused the government of a "back door" move to strip regions of the power to stay free of genetically modified organisms. New Zealand's pure image boosts produce growing exporters to earn a premium in global markets for their fruit, veges, wine and food... Read more

Smelter decision on energy contract with Meridian Energy to be made today... Read more

A decision to keep the Tiwai Point aluminium smelter open appears increasingly likely, with shares of Meridian Energy and MightyRiverPower gaining ahead of Monday's scheduled announcement on the future of the Bluff industrial plant that uses 13% percent of all the electricity generated in New Zealand... Read more

Reefton braces for loss of local goldmine. Driving into Reefton from the Lewis Pass, travellers could be forgiven for missing the goldmine perched on the hill above. It might be out of sight, out of mind, but now that the mine is set to be mothballed it will send reverberations through the town... Read more

A successful Kickstarter campaign deserves a good turn and therefore: free tacos for everyone. Lucky Taco owners Sarah and Otis Frizzell used crowdfunding site Kickstarter to raise over $100,000 to launch a range of taco kits and Mexican pickles. The fundraising finishes on Monday August 3 but they have already surpassed their $100,000 goal... Read more

Sleep disorder device supplier ResMed will acquire Curative Medical in a move it says will give it a leadership position in the Chinese market. Curative Medical is a privately held provider of ventilation and breathing devices to treat sleep disorders, with a manufacturing base in Suzhou and a distributor network throughout China and other markets. ResMed did not disclose the acquisition price.... Read more

The remaking of cult TV show Thunderbirds has launched Pukeko Pictures to the world. The Wellington-based animation studio has been working with ITV Studios in Britain to produce 26 half-hour episodes of a computer-generated remake of the classic 1960s puppet show, Thunderbirds Are Go!, and has been commissioned to make a second series... Read more

The growing wealth gap nobody talks about... Read more

Harbour Asset Management has achieved an A+ rating for its responsible investing practices.... Read more

Calibre Consulting wins Silver at INNOVATE NZ Awards... Read more

A Christchurch law firm has narrowly avoided falling victim to a cyber scam. Cavell Leitch chief financial officer Hugh O'Reilly was notified of an unusual corrupt file issue by a team member about noon on July 17... Read more

The Financial Markets Authority has filed civil proceedings against Milford Asset Management portfolio manager Mark Warminger alleging he manipulated stock prices in breach of the Securities Markets Act. The High Court suit seeks financial penalties against Warminger for trades he carried out between December 2013 and August 2014... Read more

Opinion - Andrew King: Don't blame us, blame the traders: Property Investors Federation... Read more

Opinion - Bernard Hickey: Let's talk migration. We're now having a fractious debate about foreign buying of houses, but the more important and tougher debate we should be having is about migration.... Read more

Opinion - Liz Koh: Retirement myths debunked. When you are working hard to bring up a family it's hard to imagine being retired. Retirement is like another world with a completely different set of issues, opportunities and constraints... Read more

Australian Headlines

Australian Market Report: The Australian sharemarket is tipped for a flat open ahead of a busy week of data that should show how the economy is travelling. The futures markets are pointing to a 12-point decline at today’s open after US stocks and commodities finished down on Friday, according to CommSec chief economist Craig James... Read more

The Australian dollar was little changed today ahead of a massive week of data and comments from the central bank next week. The Australian dollar was trading at US72.83c at 5pm, down from US73.01c late yesterday... Read more

Trans-Pacific Partnership delegates fail to reach final deal; pharmaceuticals, cars, dairy key sticking points... Read more

Clive Palmer insists the free trade deal with China needs to be tweaked to protect Australian jobs and wages. The Palmer United Party leader echoed concerns of Labor and the union movement about the potential exploitation of Chinese workers and the undermining of Australian workers' jobs and wages... Read more

The world's biggest regional trade deal is still within reach despite Australia walking away empty-handed from the latest talks, says the federal government. Hopes the Trans-Pacific Partnership deal could be finalised this week were dashed on Saturday when trade ministers from 12 participating nations failed to reach a final agreement on the $200 billion pact... Read more

Carers' leave will soon dwarf maternity leave as a ­crucial staffing issue because of the ageing population, ­business leaders warn. And companies will be forced to revisit the idea of ­sabbaticals as workers increasingly need extended time off to care for an elderly or ill family member, they say... Read more

Fact check: Do Australians pay less GST than people in other OECD nations?... Read more

Perth's median house price has fallen by $20,000 in the June quarter - the largest drop in two years. The Real Estate Institute of Western Australia said the metropolitan median house price dropped from $550,000 to $530,000 while the cost of units, apartments, villas and townhouses fell from $440,000 to $420,000... Read more

Queensland mergers and acquisitions climbed to $10.6 billion in the first half of the year, helped by a rising number of deals in the buoyant education and tourism sectors. A Pitcher Partners survey found a total of 126 deals were sealed in the first six months of the year, worth $300 million more than a year earlier... Read more

Million-dollar super targets labelled scare campaign. The popular claim that Australians need more than $1 million in superannuation to fund a comfortable retirement is a myth that risks undermining the strength of the system by discouraging ordinary people from saving a little extra while making them more vulnerable to poor advice, warns a new report... Read more

The price of iron ore has slipped for a second session, trending back toward $US50 a tonne after recently enjoying a surge beyond $US55 for the first time in a month. At the end of the latest session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US52.90 a tonne, down 3.1 per cent from $US54.60 a tonne in the prior session... Read more

WA is about to get its first solar powered mine site, with work due to kick off next week on a $40 million solar array to supply Sandfire Resources’ DeGrussa copper mine with a “substantial” portion of its power... Read more

Segue Resources is giving shareholders more time to acquire up to $2 million worth of shares priced at $0.003 under its Share Purchase Plan.... Read more

Roy Hill relief for Samsung. When first ore from the Roy Hill iron ore project is loaded on a China-bound ship, Gina Rinehart and fellow shareholders won’t be the only ones celebrating. Relief might be another emotion felt by executives of head contractor Samsung C&T when the $10 billion construction phase wraps up... Read more

Queensland mining minnow Stanmore Coal has snapped up a mothballed mine, unwanted by giants Vale and Sumitomo, for just one dollar. The Isaac Plains coking coal mine in central North Queensland, once owed by the Brazil's Vale and Japan's Sumitomo, was mothballed by them last year as being unviable when the coal price plunged... Read more

Sharps Heavy Equipment Repairs out of voluntary administration. Sharps Heavy Equipment Repairs was in the eye of Australia’s mining slowdown cyclone, but has managed to emerge alive, even if battered and smaller... Read more

KDL hires GPS to woo ex-staff. Kimberley Diamonds has hired investor relations major GPS to help it secure support for its proposal to regain control of its failed Ellendale mine before next week’s creditors meeting.... Read more

Wholesale distributor Dicker Data has been granted an ASX trading halt to complete a capital raising... Read more

Digital innovations put NewsCorp audiences in the box seat. Australia's biggest media company unveiled game-changing marketing initiatives to more than 700 business and advertising leaders at Fox Studios last night. Three significant launches were presented at News Corp Australia’s second Come Together presentation at Stage 7 in the Entertainment Quarter at Moore Park... Read more

CBH plants itself in Russian grain. Australia’s biggest co-operative is setting up operations in the heart of some of Russia’s best farmland and will export grain from a major port on the Black Sea. CBH, controlled by about 4200 grain growers in WA, will have an office in Krasnodar and use a local service provider to buy wheat and barley direct from Russian farmers... Read more

Insurance group IAG has undertaken a structural rejig that will see recently-appointed chief digital officer Peter Harmer handed his own, expanded, digital incubator dubbed IAG Labs.... Read more

Financial services scandal: IOOF senior executives to front Senate committee amid cover-up allegations. Senior executives from the financial services firm IOOF will face a hostile Senate committee today amid allegations they tried to cover up the deepening scandal at the company... Read more

A "forensic" investigation into allegations of front running and faulty research reports by a senior IOOF executive has found numerous breaches of IOOF's trading policy. The IOOF-funded report by PwC also identified the potential for the executive to front run during his role as an asset manager for the multi-billion dollar subsidiary Questor... Read more

A luxury Cottesloe mansion which belonged to late businessman Alan Bond is for sale, with his real estate agent daughter in charge. Mr Bond’s daughter Jody Fewster is personally handling the sale of the three-bedroom, three-bathroom home which is being promoted as a “private paradise” and for sale with offers from $4.5 million to $5m... Read more

Embattled former NewSat chief Adrian Ballintine breached the Corporations Act by failing to notify regulator ASIC that he had used his NewSat shares to secure a big loan, according to a legal advice obtained by the failed company... Read more

Opinion - Ian Verrander: Hockey needs to redo his growth numbers - pronto. The last budget was built on the assumption that growth would magically rise. But that's looking increasingly unlikely, and Joe Hockey can't bury his head in the sand and ignore this any longer, writes Ian Verrender... Read more

Opinion - Michael West: Focus on tax avoidance, not GST hikes... Read more

International Headlines

U.S. Market Report: U.S. stocks finished up this past week with the Dow Jones Industrial Average rising 0.7%, the S&P 500 Index up 1.2%, and the Nasdaq Composite Index advancing 0.8%. The S&P 500’s consumer discretionary sector advanced 1.7% on the week, and is up 4.7% for the month. Along with healthcare, the sector is also the best performing for the year with a gain of about 11%... Read more

North/South Americas Market Report: North and South American markets finished mixed as of the most recent closing prices. The Bovespa gained 1.94%, while U.S.'s S&P 500 was off 0.23%. Shares in Mexico were unchanged with the IPC at 44,752.93... Read more

European Market Report: European markets finished higher on Friday with shares in France leading the region. The CAC 40 is up 0.72% while Germany's DAX is up 0.46% and London's FTSE 100 is up 0.41%... Read more

Asian Market Report: Asian markets finished mixed as of the most recent closing prices. The Hang Seng gained 0.56% and the Nikkei 225 rose 0.30%. The Shanghai Composite lost 1.13%... Read more

Oil prices have plummeted as traders digested the latest OPEC signal that crude production would not be cut despite global oversupply and falling prices. US benchmark West Texas Intermediate (WTI) for September delivery dived almost 3.0 per cent, shedding $US1.40 to close at $US47.52 a barrel on the New York Mercantile Exchange. Brent North Sea crude for September dropped $US1.10 (2.1 per cent) to settle at $US52.21 a barrel in London trade... Read more

Zombie Private Equity Funds Sit on $127 Billion Asset Pile... Read more

Donald Trump's companies have sought visas to import at least 1,100 workers... Read more

Facebook just built a gigantic solar-powered drone that will stay in the stratosphere for months at a time, beaming broadband Internet to rural and hard-to-reach areas... Read more

A Slack Lifeline for Drowning Homeowners. A report suggests that a program intended to help as many as four million troubled borrowers has allowed big banks to run roughshod over them again and again.... Read more

What to look for in Tesla earnings... Read more

A Colorado bank has sued the Federal Reserve for not giving it permission to provide financial services to marijuana businesses. Fourth Corner Credit Union of Denver filed suit Thursday against the Kansas City branch of the Federal Reserve, which supervises banks in Colorado... Read more

Verizon's workers say no strike for now, union talks continue. Verizon Communications Inc and the unions representing its wireline unit employees on the U.S. East Coast said work will go on and talks continue after their current contract expired.... Read more

Chinese Textile Mills Are Now Hiring in Places Where Cotton Was King. Chinese textile manufacturers drawn by cheap cotton, falling labor costs and government incentives are helping revive depressed mill towns in the American South.... Read more

German Chancellor Angela Merkel faced pressure from conservative allies on Sunday to run for a fourth term in 2017 after an opinion poll showed they could win an absolute majority if an election were held next week.... Read more

Germans fret over Europe's future but still believe... Read more

Greek shares 'set to plunge 20%' as stock exchange reopens... Read more

Greece may seek 24 billion euros in a first tranche of bailout aid from international lenders in August to prop up its banks and repay debts falling due at the ECB, a pro-government Greek newspaper said in its early Sunday editions. Athens is now in talks with the European Commission and the International Monetary Fund to secure up to 86 billion euros ($94.48 billion) in bailout aid. It will be its third bailout since 2010... Read more

The Treasury could begin the process of selling part of the government's stake in Royal Bank of Scotland from Monday, according to BBC sources. UK Financial Investments, through which the Treasury owns its four-fifths holding in RBS, may sell a stake worth billions of pounds, should there be enough appetite among City investors... Read more

British Airways (BA) owner International Airlines Group (IAG) has reported a big jump in quarterly profits. IAG reported a 25% rise in pre-tax profits to €449m (£315m) for the three months to 30 June. Chief executive Willie Walsh told the BBC's Today programme the results "reflect the underlying strength of the airlines"... Read more

Former Tory leader Michael Howard to meet fraud office in Soma probe. Soma Oil and Gas denies any wrongdoing as the Serious Fraud Office opens a corruption investigation into the firm's operations in Somalia... Read more

Chinese regulators admit making inexperienced mistakes in share crash... Read more

When China’s economy was booming, motorists became a symbol of the nation’s new spending power. Now, falling car sales may be more a symbol of China’s steady deceleration. Voracious demand saw China overtake the U.S. as the world’s biggest car market in 2009, spurring auto giants including Ford Motor Co. and Volkswagen AG to supercharge their production in the country. By contrast, Ford now sees a potential decline in auto sales in China for the first time in 17 years. Volkswagen suffered its first sales drop in a decade during the first half of the year... Read more

Japanese police have arrested the chief executive of the failed company MtGox, which was once the world's biggest exchange of the virtual currency bitcoin. Mark Karpeles is being held in connection with the loss of bitcoins worth nearly $US400 million, which prompted the company's collapse in February last year... Read more

A new UN study of global population trends predicts that India will overtake China to become the world's most populous nation by 2022. The report also says that Nigeria will replace the US as the world's third most populous country by around 2050... Read more

Opinion/Analysis - Garrett Patten: Is Google ready to cross the half-trillion-dollar threshold?... Read more

Opinion - Zhengjun Zhang & Sarah Du: China needs to turn its capital ideas into SOE reform... Read more

Opinion - Mark Hulbert: Stock market is doomed to rise only 3.5% a year over the next decade... Read more

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