ASB Securities Morning Brief for Thursday, 23 April 2015
Thursday, 23 April 2015

New Zealand Headlines

New Zealand Market Report: New Zealand shares fell, paced by Meridian Energy as its upcoming installment payment weighed on the market. Spark New Zealand fell to a near eight-month low. The NZX 50 Index fell 23.904 points, or 0.4 percent, to 5793.614. Within the index, 30 stocks fell, 11 rose and nine were unchanged. Turnover was $133 million... Read more

The New Zealand dollar fell against the Australian dollar after Australian inflation data printed just above expectations giving the market little reason to add to bets for an early rate cut across the Tasman. The kiwi fell to 98.74 Australian cents, having risen as high as 99.59 cents overnight, from 99.35 cents yesterday. The local currency traded at 76.80 US cents from 76.51 cents yesterday... Read more

'Parity party' loses some fizz - for now. Australian inflation and employment figures help push Aussie dollar higher against kiwi and greenback... Read more

Business confidence softened slightly in the New Zealand Institute of Economic Research's quarterly survey of business opinion, but remains sturdy. Firms both report and expect a slight weakening of activity but only to levels indicative of annual economic growth slight above 3 per cent, NZIER economist Christina Leung said... Read more

Rents are rising – but are they keeping up with Auckland prices? Asking rents are rising nationwide, but is the rate of the increase enough to generate good returns for Auckland landlords?... Read more

Government launches new tenancy services website. Landlords can now access tenancy-related advice, information and education on a website designed to be a one-stop shop.... Read more

An Asian radio advert is boasting that property investors can get New Zealanders to "go to work for you and give you hundreds of dollars a week" in rent in Auckland's overheated property market. The advert, aired amid '60s classic hits on Singaporean radio station 90.5 Gold, sells Auckland as "an investors' dream" with no land tax, stamp duty or capital gains tax... Read more

Our comprehensive review of KiwiSaver growth funds to March 31, 2015 identifies the top performers and demonstrates how irrelevant funds names are... Read more

Advisers are worried new reporting requirements for wrap providers may be confusing their clients. As of April last year, services such as wrap platforms that provide custodial services must regularly report to their retail and smaller wholesale clients about money and property being held under their watch, under the Financial Advisers (Custodians of FMCA Financial Products) Regulations... Read more

Just over 13 years after Kiwibank was launched in February 2002 as a subsidiary of NZ Post with $83 million of taxpayers’ money, the state owned bank has paid its first proper dividend. Late last month Kiwibank paid a $21 million dividend... Read more

The Tūwharetoa Settlement Trust and associated entities has paid about $20 million for 8,500 hectares of Crown-owned land in the central North Island, adding to the vast swathe of forestry land vested in the region's iwi under the CNI Forests Collective Settlement... Read more

Seafood harvester Sanford is breeding mussels like farmed sheep or cattle to produce millions of spawn for a steadier future. The company opened a hatchery in partnership with the Ministry for Primary Industries (MPI) three weeks ago, just before the firm shut its processing plant in Christchurch... Read more

NZX questions Unlisted's rule exemption bid. NZX, New Zealand's only registered stock market operator, fears that exempting the unregulated Unlisted share trading platform from new market rules risks undermining their aim to strengthen confidence in New Zealand's financial markets... Read more

The NZX says it has looked at information about trades in Xero shares as part of its ongoing investigation into trading that took place in the company's shares in February. The exchange and market regulator has yet to reveal what they may show. Xero shares spiked unexpectedly during the week prior to a February 25 announcement that it had raised $147 million on favourable terms from new investors, prompting a query from the NZX... Read more

Goldman Sachs New Zealand Holdings has posted a 52 per cent drop in revenue and a full-year loss for 2014. The local unit of the Wall Street investment bank reported a $2.9 million loss for the 12 months to December 31, down from a $16 million profit in the same period a year earlier, according to financial statements lodged with the Companies Office... Read more

Opus International Consultants, the listed engineering firm, says the 2015 year is mixed so far, with earnings in Canada and Australia hurt by weak oil prices and a downturn in the resources sector respectively, while a buoyant economy is lifting New Zealand returns... Read more

Vital Healthcare Property Trust has leased its Gold Coast hospital to Ramsay Health Care, an international hospital provider, for the next 21 years. Shares of Vital rose 1.2 percent to $1.695. Shares of Ramsay last traded at A$64.90 on the ASX, and has a market capitalisation of A$13.1 billion. ... Read more

Women's fashion retailer Glassons has received a dismal overall D-minus rating in a new report designed to expose the exploitation of workers in the industry. The Truth Behind the Barcode: Australian Fashion Report 2015 surveyed 219 fashion brands on their policies, traceability and transparency, monitoring and training, and workers' rights... Read more

Former Prime Minister Jenny Shipley wants New Zealand firms to take advantage of her appointment to the board of the Boao Forum, which is made up of global political and commercial leaders, to seek business opportunities in Asia... Read more

Demand for Enable's broadband grows. Consumer demand for emerging online television and movie services has helped Enable's ultrafast customer base to rise to 10,000. Enable chief executive Steve Fuller says the Christchurch customer total is a 220 per cent increase on the 3,000 customers signed up 12 months ago.... Read more

Wynyard Quarter apartments set to top $5million.... Read more

Digital tech has no impact on nearly a third of small and medium firms. Nearly one-third of New Zealand small and medium-sized enterprises say digital technology has had no impact on their business over the past five years and 27 per cent don't expect it to in the next five years.... Read more

Debbie Power, a senior executive in the Ministry of Social Development , has been named deputy State Services Commissioner.... Read more

Marcia Smythe Appointed to Mortgage Express... Read more

Roy Morgan announces 2014 winners of New Zealand Customer Satisfaction Awards... Read more

An Auckland ratepayer who owed $59.393 for rates and penalties and was on the verge of having their section sold by auction has avoided that that outcome. The vacant Belmont section was to have been sold today by Barfoot and Thompson on the orders of the High Court. The auction was withdrawn after the debt was paid... Read more

Opinion - David Hargreaves: The trouble with bubbles. We should embrace and accept Auckland's housing bubble - but do something about it as well... Read more

Opinion - Craig Lamberton: Hot property and capital gains. Who'd have thought reality TV could help shed light on taxation of residential property in New Zealand?... Read more

Opinion - Michael Worth: New Zealand is struggling to reach its Kyoto targets and balance its books, so any moves by the government in Budget 2015 to support electric vehicles will go a long way to alleviate these problems... Read more

New Zealand Herald Editorial: Petrol profit margins the real area of concern. Just what did Z Energy think it would achieve with another report dispelling the notion that petrol companies are quick to raise fuel prices but slow to drop them when oil prices fall?... Read more

Opinion - Pattrick Smellie: Crown Irrigation Investments schemes make slow progress... Read more

Australian Headlines

Australian Market Report: The Australian share market has closed lower after CPI figures today showed inflation growth is at its weakest annual pace in almost three years. The 0.2 per cent quarterly inflation rise saw market expectations for a Reserve Bank rate cut in May ease. At the close on Wednesday, the benchmark S&P/ASX200 index was 34.8 points, or 0.59 per cent, lower at 5,837.5, while the broader All Ordinaries index was down 31.2 points, or 0.53 per cent, at 5,812.8, according to preliminary figures... Read more

The Australian dollar gained half a US cent after figures showing the inflation rate has risen at its slowest annual pace in nearly three years. The Australian Bureau of Statistics figures added pressure on the Reserve Bank of Australia to stimulate the economy, some analysts said. The local currency rallied to a high of US77.73 cents after the inflation figures were released, from US77.20 cents just prior.... Read more

Slow inflation leaves room for rate cut. Drops in petrol and fruit prices are helping keep a lid on inflation, leaving the door wide open for another interest rate cut. Inflation rose 0.2 per cent in the March quarter for an annual rate of 1.3 per cent, well below the Reserve Bank's two to three per cent target band, and its weakest result in almost three years... Read more

'Unique' Australian economy set for steep downturn and 7pc unemployment: BlackRock... Read more

The Federal Opposition has declared the nation's superannuation system a "tax haven" for the wealthy and detailed a plan to increase super taxes on high-income earners. Labor said the proposal, costed by the Parliamentary Budget Office, would raise more than $14 billion over a decade... Read more

FSC cautious on Labor's super plans... Read more

Financial advisers need to lift their game after a series of scandals that have damaged trust in the industry, the head of National Australia Bank's wealth business says. Fresh calls are being made for a royal commission into the sector after victims of dodgy financial advice from the likes of NAB, Commonwealth Bank and Macquarie Group lost millions in savings... Read more

Purchasing on plastic is back in vogue as consumers apply for credit cards at the fastest rate in nine years. Demand for credit cards jumped 13.5 per cent in the March quarter amid a flurry of bank special offers and improving consumer confidence, new research by credit information company Veda has found... Read more

A new economic report warns the Northern Territory has a lot of eggs in one basket and is quickly approaching a "construction cliff" due to the winding down of a phase of a major gas project... Read more

A1 Consolidated Gold has been granted an ASX trading halt in relation to a potential capital raising.... Read more

Resources giant BHP Billiton has slowed the pace of its iron ore expansion by shelving a Port Hedland harbour project in a nod to weak prices. There was no suggestion by BHP that it was in response to criticism it was causing a supply glut amid tumbling prices... Read more

Aurizon claims victory over disputed enterprise agreements with unions. Aurizon has won a major industrial relations victory after the Fair Work Commission agreed to terminate costly work agreements struck prior to the rail giant being privatized.... Read more

Global ratings agency Standard & Poor's has downgraded Origin Energy to the lowest "investment grade", while Fortescue fell further into "junk" status. S&P cut Origin from BBB, where it was on a negative outlook, to BBB- as falling global energy prices undermine the profitability of the company's massive LNG operations near Gladstone in Queensland... Read more

Boom Logistics, a major supplier of cranes to mining companies, is warning shareholders of a big dip in profit during the second half of the financial year.... Read more

Cassini Resources on capital raising drive... Read more

United Dairy Power sell-off begins. Two of Australia’s most progressive dairy companies have announced their separate purchases of parts of the financially-distressed United Dairy Power empire. Victoria’s Burra Foods has bought the Gippsland assets of United Dairy Power and assured local dairy farmers of their continuing milk supply contracts... Read more

Investors in troubled satellite firm NewSat have been lumped with a potential $558,000 tax bill stemming from a $1.2 million bonus awarded to flamboyant chief executive Adrian Ballintine last year... Read more

Packer secures a stream of high rollers for Crown. One of Macau’s leading casino junket operators for high rollers has extended its operations to Australia after forging an alliance with James Packer’s Crown Resorts.... Read more

Yesterday's taxi strike and Uber's offer of a free ride for new users led to a 500 per cent increase in sign ups compared to the average day, the controversial ride sharing company claims... Read more

Redflow Limited non-executive director Simon Hackett has increased his indirect interest in the company by 17,222,515 shares through participation in its recent $9.7 million share placement. The share placement was part of a broader $16.1 million capital raising... Read more

Asaleo eyes full-year profit jump... Read more

Microsoft phishing filter blocks legitimate Aussie sites... Read more

Components manufacturers can expect job losses after latest Holden jobs cut, Automotive Taskforce warns. Hundreds of jobs are likely to go from car components firms as part of the latest round of industry cutbacks, the man heading South Australia's response to Holden's imminent manufacturing closure says... Read more

The corporate regulator is expected to grill Aldi over its failure to consistently notify customers of fees for using credit cards and 'tap and go' cards, six months after the discount supermarket promised it had done so... Read more

The owners of the Hollywood film Dallas Buyers Club could start the process of sending out letters to alleged Australian pirates next month. In a follow-up hearing in Sydney today following a landmark judgment earlier this month, Eastern States media reported the film's owners have set a May 6 date for iiNet, and other service providers such as Dodo, to hand over the personal details of the people it alleges illegally downloaded the Hollywood film... Read more

Opinion - Miranda Maxwell: Fear of the Chinese sneeze is exaggerated... Read more

International Headlines

U.S. Market Report: U.S. stocks rose in afternoon trading on Wednesday as Visa's potential expansion into China and talk of a turnaround at McDonald's helped investors see the bright side of mixed quarterly earnings... 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 1.49% while U.S.'s S&P 500 is up 0.55% and Mexico's IPC is up 0.30%... Read more

European Market Report: European markets finished mixed as of the most recent closing prices. The CAC 40 gained 0.36%, while the DAX led the FTSE 100 lower. They fell 0.60% and 0.49% respectively... Read more

Asian Market Report: Asian markets finished broadly higher today with shares in China leading the region. The Shanghai Composite is up 2.44% while Japan's Nikkei 225 is up 1.13% and Hong Kong's Hang Seng is up 0.34%... Read more

Oil prices rose on Wednesday after the U.S. government's Energy Information Administration (EIA) reported a decline in U.S. production. Brent crude for June delivery LCOc1 was up 66 cents at $62.74 a barrel by 1358 GMT, after touching an intraday low of $61.39. U.S. crude for June delivery CLc1 was up 20 cents to $56.81 a barrel, after reaching a low of $55.73 earlier in the session... Read more

Middle East tensions push gold back above US$1200 an ounce... Read more

U.S. economic growth is set to rebound in the second quarter, but a strong dollar could slow momentum and push the first interest rate hike from the Federal Reserve to later this year, a Reuters poll found... Read more

McDonald's Corp's new chief executive officer, who is charged with reinvigorating world's biggest restaurant chain, on Wednesday said he would deliver his turnaround plan next month. In his first quarterly conference call with investors and analysts, CEO Steve Easterbrook described himself as a "champion of simplicity" who values personal accountability and "progress over perfection." He took the helm on March 1 following one of McDonald's most dismal years on record... Read more

Google has detailed its plan to run a mobile phone network in the US. The firm will rent voice and data capacity from two existing operators - Sprint and T-Mobile - and use existing wi-fi hotspots, rather than build new infrastructure from scratch... Read more

American Apparel Accused in Suit of Firing Charney to Sell Chain. Dov Charney was fired as American Apparel Inc.’s chief executive officer because he wouldn’t go along with a plan to sell the clothing retailer, according to a shareholder lawsuit brought by two men with ties to him.... Read more

A 36-year-old futures trader who operated from his London-area home indicated Wednesday that he would oppose extradition to the United States on criminal fraud charges, including claims that he had helped set off a huge crash in the United States stock market, known as the flash crash, in 2010... Read more

Citigroup must face South Korean bank's lawsuit over failed CDO. A U.S. appeals court on Wednesday revived a lawsuit in which South Korea's Woori Bank accused Citigroup Inc of defrauding it into buying risky mortgage securities that Citigroup was betting against, prior to the financial crisis... Read more

Greek markets hit by jitters as Athens fights emergency cash raid. Stocks fall to their lowest level in three years on fears Greece's plans to raid local coffers will be blocked by municipalities... Read more

Greek Banks Win More Emergency Cash as Talks Loom... Read more

'Noflation' helps squeeze on household finances ease to six-year low. Low inflation boosts household finances, but expectations for wage growth remain weak... Read more

Deutsche Bank said it expects litigation costs of €1.5bn in the first quarter. Germany's biggest lender did not give any details about the legal bill. However, the bank is expected to be hit with fines resulting from a number of investigations by regulators in the US and the UK... Read more

Tesco posts record £6.4bn annual loss... Read more

Rolls-Royce has said that John Rishton will retire as chief executive on 2 July and be replaced by Warren East. Mr Rishton, who has been at the firm since 2011, said it was "time for a change in lifestyle"... Read more

Lufthansa and pilots resume contact in labor dispute: union... Read more

InterOil open to takeover offers. InterOil, the independent oil-and-gas company working with France's Total to explore one of Asia's largest undeveloped gas fields, isn't ruling out a possible takeover if the price is right, a senior InterOil executive said... Read more

The European Commission has charged Gazprom with abusing its dominant market position in Central and Eastern European gas markets. The Commission said its preliminary view was that the Russian energy giant was breaking EU anti-trust rules... Read more

Israeli turnaround specialist Erez Vigodman, the chief executive of Teva Pharmaceutical Industries, is looking to pull off the ultimate transformation with the biggest deal in Israel's corporate history... Read more

China's push to challenge US dominance in global trade and finance may involve gold - a lot of gold. While the metal is no longer used to back paper money, it remains a big chunk of central bank reserves in the United States and Europe. China became the world's second-largest economy in 2010 and has stepped up efforts to make the yuan a viable competitor to the dollar. That's led to speculation the government has stockpiled gold as part of a plan to diversify $3.7 trillion in foreign-exchange reserves.... Read more

Thailand's government said it is "confident" it can address concerns over illegal fishing that could result in a trade ban from the European Union. The EU warned on Tuesday that it would block seafood imports unless "a corrective tailor-made action plan" was implemented within six months... Read more

Is It a Good Idea to Buy Gold on Akshaya Tritiya?... Read more

Car-hailing service Uber Technologies Inc. has tied up with India’s restaurant searching company Zomato Media Pvt. as it seeks to embed itself deeper into the lives of the world’s tech-savvy citizens... Read more

Opinion - Allister Heath: Britain’s productivity crisis: beware all the usual simplistic solutions... Read more

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