ASB Securities Morning Brief for Thursday, 01 October 2015
Thursday, 01 October 2015

New Zealand Headlines

New Zealand Market Report: New Zealand shares fell, dragged down by companies shedding rights to their dividends including Genesis Energy, Auckland International Airport, Ebos Group and Skellerup Holdings. The benchmark index ended the quarter 3.5 percent down. The S&P/NZX 50 Index fell 19.06 points, or 0.3 percent, to 5593.36. Within the benchmark index, 28 stocks fell, 13 rose and nine were unchanged. Turnover was a bigger than usual $198 million, ending trading in the quarter... Read more

The New Zealand dollar gained after business confidence rose for the first time in six months, adding to speculation there's enough positive signs in the economy to deter the central bank from cutting interest rates again next month. The kiwi rose to 63.65 US cents at 5pm in Wellington, from 63.06 cents yesterday. The trade-weighted index advanced to 69.42 from 68.97 yesterday... Read more

Trade Minister Tim Groser will attend a meeting of trade ministers in Atlanta, Georgia, where negotiations are attempting to conclude the Trans Pacific Partnership (TPP). Mr Groser had been playing hard to get for the meeting, indicating a willingness to attend only if there was an improvement on the "wholly inadequate" offers of dairy market access from the heavily protected agricultural sectors in the US, Canada and Japan... Read more

New Zealand Prime Minister John Key says there's a chance the Trans-Pacific Partnership trade deal could be completed this week.... Read more

NZ business confidence snaps five-month decline as firms get less gloomy... Read more

Kiwis kept the foot somewhere near the floor when it came to household borrowing during August ahead of new tax rules coming in tomorrow and new Reserve Bank loan limits starting in November... Read more

New residential dwelling consents were down by 4.9% in August 2015 but this comes in the midst of an increasing trend, according to Statistics New Zealand... Read more

The value of building consents reached an all-time high in August 2015, boosted by planned nonresidential work in Christchurch, Statistics New Zealand said today. Over $1.5 billion of building work was consented across New Zealand, with one-quarter of that value coming from non-residential buildings in Christchurch... Read more

Unnecessary regulation for developers. Property developers and investors are being asked whether corporate vehicles used to manage costs associated with communal facilities should be regulated by the Financial Markets Conduct Act... Read more

Property experts say Bill English's housing crash warning may not move market... Read more

Auckland Council's chief economist demands urgent Govt action on housing affordability. Auckland Council’s chief economist is calling for authorities to make renting more attractive, implement road user charges, relax some building restrictions and shut the NIMBYs (‘not in my back yarders’) up, to help solve Auckland’s housing problems... Read more

Fonterra drops price guarantee... Read more

Westland Milk lifts 2016 forecast payout to $4.90-$5.30/kgMS, sees signs of price recovery... Read more

Warehouse Group, New Zealand's largest listed retailer, has taken control of its financial services joint venture, buying out partner Westpac Banking Corp's stake for $7.3 million. The acquisition is the next step in the Auckland-based retailer's development of an in-house financial services business, and gives it control of a loan book of $57 million, which will be funded by a combination of equity proceeds from its 2014 capital raising and debt secured in partnership with Westpac... Read more

MYOB, the Australian payment solutions software developer, has bought Hastings based payroll provider Information Management Services for as much as $9.7 million, its fourth New Zealand acquisition in recent years. MYOB shares last traded at A$3.35 on the ASX, and have declined 11 percent this year.... Read more

Troubled childrenswear retailer Pumpkin Patch has given itself some breathing space after reaching a deal to extend borrowing facilities with its banker ANZ. Reporting its results for the year to July 31 this morning, the company said it had signed a new banking agreement yesterday to provide a stepped repayment plan out to the end of 2017... Read more

Pumpkin Patch’s new chief executive, Luke Bunt, says further capital will be needed to drive a turnaround in the troubled childrenswear retailer but it’s too early to say how much. The company reported today it had reached a deal to extend borrowing facilities with its banker, ANZ, in a stepped repayment plan to the end of 2017 after reducing debt by $26 million to $39 million in the past financial year... Read more

SeaDragon raises $10.009 million via rights offer and shortfall bookbuild, and additional placement... Read more

CentrePort, Wellington's port operator, returned to profit as increased log shipments and container volumes helped it recover from an earthquake affected result in 2014. Net profit rose to $14 million in the 12 months ended June 30, turning around a loss of $1.9 million in the earlier year when CentrePort incurred costs for the July 2013 earthquakes, which damaged the port, the Wellington-based company said in a statement... Read more

Pushpay tithe app attracts Pie Funds capital. Pie Funds chief executive Mike Taylor says Pushpay's growth potential convinced his firm to take a stake in the software developer through participating in its $18.7 million capital raising, announced yesterday. Pushpay will raise the cash through issuing new shares at $4.88 each - an 18.7 per cent discount to the stock's $6 opening price yesterday - to a number of existing and new investors through a private placement... Read more

Orion Health, the listed healthcare system software developer, announced a deal to roll out its technology to 2,400 Boots community pharmacy stores across the UK and Ireland. The value of the contract has not been disclosed but chief executive Ian McRae said it was a mid-sized deal for Orion and potentially reaches 750,000 Boots customers. The announcement wasn't enough to reverse a 48 percent decline in Orion's stock since its listing last November and the shares slipped today... Read more

SLI Systems expects new San Jose-based CEO to lift revenue growth in largest market... Read more

Warehouse buys out financial services JV partner Westpac for $7.3 million. Warehouse shares fell 2.3 percent to $2.53 and have declined 17 percent since the start of the year. ... Read more

Jiajiayue Group ties investment in Cooks Global Foods to OIO approval for farm purchase. iajiayue Group's $4.5 million investment in NZAX-listed Cooks Global Foods is conditional on the Chinese supermarket chain gaining Overseas Investment Commission approval for the purchase of a sheep and beef farm in New Zealand.... Read more

Pyne Gould Corp, which today blamed its auditor for the late filing of its annual report, is suing Bath Street Capital and Andrew Barnes for at least $22 million that it claims is an unpaid bill from the sale of Perpetual Trust.... Read more

PGC blames auditors for delayed annual report two years running... Read more

Veritas to appeal Burger King decision to quit meat patty supply deal. Veritas shares were unchanged at 50c, and have dropped 58% this year... Read more

Global oil company Shell's New Zealand arm has postponed plans to drill an exploration well over the summer in the lightly explored Great South Basin, south of the South Island, where oil companies have looked for deep sea oil and natural gas sporadically since the 1960s... Read more

Airfare wars: No sign of slowing down. A price war being waged between New Zealand's two main airlines has resulted in a "a low fares bonanza" that appears set to continue into next year.... Read more

Mainfreight co-founder, philanthropist Neil Graham dies, aged 71... Read more

Z Energy off the hook – tanker strike action now unlikely. A four-day strike is now unlikely at Pacific Fuel Haul as the company agrees to its workers’ demands.... Read more

Andrew Robinson, a former director of Strategic Planning Group jailed in July for six years over a $2.7 million fraud, has pleaded guilty to charges of making false statements in relation to the same business. The charges follow investigations by the Financial Markets Authority and the Serious Fraud Office into the activities of SPG and SPG Investment Company No 1 that began in 2012... Read more

IRD on why it can't, or won't, speak about the settlement of a long running tax dispute with ASB... Read more

Auckland Council has applied to have perennial activist Penny Bright’s $350,000 claim for damages arising from alleged defamation struck out. Ms Bright’s defamation claim is in relation to comments made by the council in a press statement last year over her unpaid rates... Read more

A company director who falsified applications for grants from a gaming machine society has been sentenced to six months community detention and 400 hours community work. Jeffrey Michael Horne, who had name suppression until today, also has to repay more than $47,000 to the society for return to the community... Read more

Opinion - Allan Barber: Allan Barber says Shanghai Maling is no Trojan horse and is probably much a better owner than the Vesteys and Borthwicks of the past. And farmers will still hold "a powerful weapon"... Read more

Opinion - David Hargreaves: In search of housing solutions. Bill English's 'thinking out loud' on the affordable housing problem suggests the Government's planning some serious action... Read more

Opinion - Fran O'Sullivan: Odd that Lochinver deal left up to juniors. It seems bizarre that the man in charge of growing the economy is not right to the fore on such transactions... Read more

Analysis - Miriam Bell: Is a housing market crash inevitable? Auckland’s superhot housing market could be facing a big crash, the Finance Minister has warned – but others dispute that... Read more

Opinion - Jane Kelsey: Trade deal a minefield... Read more

Australian Headlines

Australian Market Report: Australian sharemarket closes firmer after a horror quarter. The Australian sharemarket has finished its worst quarterly performance in four years on a fimer note, clawing back more than half of Tuesday’s horror $56 billion resources rout. At the 4.15pm (AEST) official market close, the benchmark S & P/ASX200 index was up 103.2 points, or 2.1 per cent, at 5021.6, while the broader All Ordinaries index had jumped 100.5 points, or 2.03 per cent, to 5058.6.... Read more

The Australian dollar has bounced from its recent lows helped by some encouraging US consumer confidence figures. At 7am, the local unit was trading at US69.85c, up from US69.47c yesterday. The currency hit a low of US69.37c, its weakest level in almost four weeks, after the Australian sharemarket plunged more than 3 per cent, weighed down by a sell-off in resources stocks... Read more

Aussie gold holds above A$1600 an ounce... Read more

The spring auction season has got off to a mixed start, with the proportion of homes sold in September down from 2014. Lower clearance rates reflect an increase in the number of owners seeking to sell their property, and indicate a greater choice for buyers but a more challenging environment for sellers... Read more

The Federal Opposition says it still has concerns about the China-Australia Free Trade Agreement (ChAFTA), as the Chinese ambassador warns against letting the deal "slip away". China's ambassador to Australia Ma Zhaoxu used a speech in Melbourne to promote the benefits of the ChAFTA, as the stand-off continues between Labor and the Federal Government... Read more

Mining industry unemployment three times national jobless average: report... Read more

Rio Tinto has struck a $865 million deal to sell its 40 per cent stake in the Bengalla open cut coal mine in NSW to New Hope Corporation. Bengalla is the smallest of three coal mines in NSW's Hunter Valley in which Rio holds an interest, and produced 8.6 million tonnes of thermal coal in 2014. It can be expanded up to 12 million tonnes a year. Rio's shares closed $2.08 higher at $48.60 while New Hope rose 11.5 cents to $1.765.... Read more

Mining's emerging market darling Dacian Gold says it will cost $157 million to turn its Mt Morgans project into an operation producing bullion at less than $1000 an ounce... Read more

Glencore, the London-listed commodities company whose dramatic share plunge sparked yesterday’s $60 billion rout on the Australian share market, could be the trigger for the next GFC, analysts have warned. Shares in the world's largest commodities trader plummeted 29 per cent on Monday after investment bank Investec Securities issued a warning about the company’s ability to repay debts amid falling commodity prices... Read more

Glencore shares continue to rise... Read more

Sundance Resources to update on working capital funding... Read more

Simon Moorfield joins energy giant. AGL Energy has opted to reinstate the CIO role it retired in April following an executive restructure, and has hired Commonwealth Bank IT exec Simon Moorfield into the position. ... Read more

Phoenix Gold once again says No to Evolution Mining offer... Read more

Origin Energy is cutting dividends and issuing up to $2.5 billion in new, discounted shares as part of a massive effort to survive the oil price crash. The company's $4.7 billion in new capital measures are aimed squarely at cutting debt, which is peaking above $13 billion at the same time oil prices stumble at six-year lows and financial markets endure huge volatility... Read more

Energy company AGL has defended its Gloucester coal seam gas project in northern NSW as opposition groups and some shareholders protested against it at AGL's annual general meeting. Those opposing the Gloucestor exploration project say it threatens drinking water in the local area and beef, dairy, horticulture and tourism operations, and is not a wise investment for AGL while gas prices are low. Shares in AGL were 26 cents lower at $15.97.... Read more

Anova Metals raising funds for gold project in Nevada... Read more

Shares in Brierty fell after the contractor posted a full-year profit of just $3.1 million and warned it was in breach of debt covenants... Read more

Will Metcash be the first casualty of the supermarket wars? Spme analysts believe struggling grocery supplier Metcash could be gone within a decade in the face of intense competition from Woolworths, Coles and Aldi, but the company says it can turn things around... Read more

Empired Limited has landed a $12 million contract to provide managed services for all of Western Power's corporate information technology networks across Western Australia... Read more

A coaching service for startups and entrepreneurs has become the latest Singapore tech company to list on the Australian share market. iBosses, which offers a mentoring program that takes wannabe startups from start to finish, made a fairly flat market debut on Wednesday, with its shares rising just one cent to 21 cents after they began trading at 1300 AEST. The stock closed flat at 20 cents.... Read more

International call saving company Norwood Systems has announced a partnership with Under the terms of the agreement, the online hotel booking company’s accommodation options will be made available to users of Norwood’s World Phone app. Norwood shares closed steady at 2.3 cents after touching an intraday high of 2.5 cents.... Read more

Medical device company dorsaVi has signed a multimillion deal with leading UK physiotherapy network YourPhysioPlan to market and sell ViMove in the UK and Ireland. ViMove is a wireless sensor technology that objectively measures human movement... Read more

Qantas has reported a modest rise in monthly passenger numbers amid hopes that its shareholders could be in line for a $2 billion windfall. Qantas shares closed one cent higher at $3.72.... Read more

TPG Telecom's 320,000 mobile users will be switched over to the Vodafone network in a $1 billion tie-up between the two telcos. TPG Telecom will drop Singtel-owned Optus as its mobile provider in favour of Vodafone Australia and, in turn, extend its so-called dark fibre network to carry its new partner's mobile data... Read more

TPG to build Vodafone dark fibre network in $1bn deal... Read more

David Jones chief executive Iain Nairn is leaving the department store after only 14 months in the job.... Read more

Embattled 7-Eleven boss resigns after pay scandal... Read more

American food giant PepsiCo is shutting its Smith’s chips factory in Canning Vale, putting up to 300 people out of work and slashing a fifth of potato sales from WA farmers... Read more

WA spud wars boil over into court. WA’s spud wars have boiled over after the State’s Potato Marketing Corporation yesterday took its feud with rogue grower Tony Galati to the Supreme Court, alleging he broke the law by growing and selling too many potatoes... Read more

Commonwealth Bank compensation scheme pays out to 19 financial advice customers... Read more

Opinion - Peter Fay: Media M&A could heat up with Turnbull in charge... Read more

Opinion - Nassim Khadem: Why 'ridesharing' service Uber still needs to make sure its drivers pay GST... Read more

Opinion - Catherine Middleton: Broadband is the key infrastructure for the 21st century... Read more

International Headlines

U.S. Market Report: US stocks have jumped in opening trade, following European bourses, which rose sharply on speculation of further monetary stimulus. Five minutes into trade on Wednesday, the Dow Jones Industrial Average stood at 16,239.61, up 190.48 points (1.19 per cent). The broad-based S&P 500 rose 25.05 (1.33 per cent) to 1,909.14, while the tech-rich Nasdaq Composite Index gained 70.02 (1.55 per cent) at 4,587.34.... Read more

North/South Americas Market Report: North and South American markets are mixed today. The S&P 500 is up 0.99% while the IPC gains 0.59%. The Bovespa is off 0.56%... Read more

European Market Report: European markets closed sharply higher today with shares in London leading the region. The FTSE 100 is up 2.58% while France's CAC 40 is up 2.57% and Germany's DAX is up 2.22%... Read more

Asian Market Report: Asian markets finished broadly higher today with shares in Japan leading the region. The Nikkei 225 is up 2.70% while Hong Kong's Hang Seng is up 1.28% and China's Shanghai Composite is up 0.48%... Read more

Oil prices retreated in Asia Wednesday as traders focus on US crude stockpile report, a day after growing concerns over China's economy sparked a massive sell-off in shares of commodity firms. As Asian stocks recovered from Tuesday's rout, oil prices remain under pressure because demand growth continues to fall behind crude supply, analysts said. US benchmark West Texas Intermediate (WTI) for November delivery fell 44 cents to $44.79 and Brent crude dropped 36 cents to $47.87 a barrel in late-morning trade.... Read more

IMF's Lagarde warns on global economy... Read more

Forbes gave Donald Trump’s net worth a $5.5 billion haircut. Presidential GOP front-runner Donald Trump isn’t as rich as he thinks. At least, that is according to Forbes’ magazine’s most recent issue slated to hit newsstands October.... Read more

Ralph Lauren hands CEO role of his company to former Old Navy president... Read more

Billionaire investor Carl Icahn has signaled the end of the seven-year bull run for stock markets. "I think the joyride is over," the activist investor said during an interview on CNBC Wednesday... Read more

The Model X is finally here. But auto enthusiasts seemed way more excited than Tesla shareholders so far. Shares of Tesla were down about 1% Wednesday, while the broader market rallied... Read more

It is premature to start discussing the possibility of extending the European Central Bank's bond-purchasing program, Estonia's central bank chief Ardo Hansson said on Wednesday. He said that when the program started this year in March, it had been planned for 19 months. "We are still in the initial phase of the program, " Mr Hansson said, adding it is too early to start "dealing with the issue" of extending it as it has been under way for only six months... Read more

Just when the world could use some good economic news, Europe manages to deliver another nasty surprise. China is slowing, Japan is flirting with yet another recession, and now the eurozone economy has fallen back into deflation.... Read more

German retail sales, a closely watched measure of household confidence, eased in August, amid signs consumer sentiment in Europe's top economy could be starting to wane, official data showed on Wednesday. Retailers' sales slipped by by 0.4 percent in August compared with July, the federal statistics office Destatis said in a statement. The previous month, retail sales had risen by 1.6 percent... Read more

The UK economy has performed better than previously thought since the financial crisis, government statisticians said on Tuesday, bolstering the Bank of England's case that interest rates will probably rise sooner than markets expect... Read more

The Bank of England governor has given a stark warning that climate change poses a huge risk to global stability. At a gathering of leading insurers at Lloyd's of London, Mark Carney pointed out the rapid increase in weather-related catastrophes and the jump in both the physical and financial costs... Read more

Sportswear giant Lacoste has won EU court backing to block a Polish competitor from snapping up a variant of the crocodile logo it upheld as the French firm’s trademark.... Read more

Uber is having an increasingly tough time in Europe as authorities try to crack down on the tech-savvy taxi company. Here's what's happening right now in London, Paris and Amsterdam:... Read more

For the first time, Apple is making available some of its digital offerings to customers in China. The company announced Wednesday that iTunes Movies, iBooks and Apple Music are now available in China, offering access to content including music from Chinese artists, as well as international pop stars including Taylor Swift and Ed Sheeran... Read more

China's economy is officially growing at a brisk clip of 7 percent, but many locally based executives at multinationals say they wouldn't know it from the performance of their businesses. By China's standards 7 percent is already the weakest annual growth in 25 years, but on the ground the slowdown in the world's second-biggest economy is being felt more acutely in many sectors, even those driven by consumer spending, which government data says is growing around 10 percent... Read more

A Russian Smartphone, made for China... Read more

Chinese officials have fined Canadian train maker Bombardier and a local unit of train giant CRRC for setting up a joint venture without government approval. Bombardier and CSR Nanjing Puzhen have both been fined 150,000 yuan ($23,572; £15,578) each, according to the ministry of commerce... Read more

China's Tsinghua Buys Western Digital Stake for $3.8 Billion. Tsinghua University’s agreement to invest $3.8 billion in Western Digital Corp. would be China’s biggest technology share purchase in the U.S. while adding substantially to the hard-drive maker’s ability to fund acquisitions... Read more

Bangkok to closely examine trade deal with Eurasian Economic Union - Thai Ambassador... Read more

Modi powers India up ranking of most competitive economies. After five consecutive years of decline, India has jumped 16 places to 55th in the World Economic Forum's ranking of the most competitive economies. Call it the "Modi Effect."... Read more

India talks tough on black money in hunt for hidden billions. When an Indian deadline for declaring illegal assets expires Wednesday, billions of rupees hidden in foreign bank accounts or funnelled into property abroad will emerge into the light -- or so the government hopes.... Read more

Nigeria's President Muhammadu Buhari to run oil ministry... Read more

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