ASB Securities Morning Brief for Wednesday, 25 February 2015
Wednesday, 25 February 2015

New Zealand Headlines

New Zealand Market Report: New Zealand shares fell paced by Genesis Energy and MightyRiverPower as their first-half earnings disappointed investors. Outside the benchmark index, SLI Systems climbed. The NZX 50 Index fell 31.392 points, or 0.5 percent, to 5722.965. Within the index, 24 stocks fell, 17 rose and nine were unchanged. Turnover was $120 million... Read more

The New Zealand dollar fell after inflation expectations dwindled in the Reserve Bank's latest survey of local firms, who didn't expect the central bank to raise interest rates this year, and ahead of US Federal Reserve chair Janet Yellen's semi-annual testimony to legislators. The kiwi dropped to 74.75 US cents at 5pm in Wellington from 75.20 cents at 8am, and 75.13 cents yesterday. The trade-weighted index declined to 77.69 from 77.92... Read more

Living wage estimate rises to $19.25/hour... Read more

NZ firms again lower their inflation expectations, see no RBNZ action this year... Read more

Banks are warning that "significant deals done at ridiculous pricing" for New Zealand land and property could spell disaster for them, according to KPMG... Read more

Property developers are sounding a warning that the Government's plan to enable more affordable housing to be built is being undermined by skyrocketing construction costs. They say the cost of building a house is up almost 50% in just two years and combined with rising land prices they say this makes building an affordable house almost impossible... Read more

New Zealand export log prices rose to a nine month high in February as local returns were bolstered by a decline in the kiwi dollar and lower shipping costs... Read more

New Zealand companies are airfreighting up to 10 tonnes of fresh milk a week to China, with the latest exporter to enter the market former Federated Farmers chief executive Conor English... Read more

A partner with a top law firm says up to 20 sharemarket floats could take place this year. Chapman Tripp, which advised eight of the 12 NZX main board listings last year, will release its New Zealand Equity Capital Markets Trends and Insights report today... Read more

A busy development schedule and big growth from the country's third largest listed retirement specialist Summerset Group delighted analysts. Net profit after tax for the six months ended December 31 was $54.2 million, up 58 per cent from $34.2 million in the same period the previous year, and the business remains in a big expansion phase... Read more

Summerset Group Holdings says pent up demand for retirement living means it will look for further sites in Christchurch once it has built its Wigram and Casebrook villages... Read more

PGG Wrightson shares rose to a four-year high after the rural services firm controlled by China's Agria Corp lifted first-half earnings 47 percent, beating estimates, on improvements in its retail, livestock and seed & grain units... Read more

SkyCity will have made $27 million out of the convention centre deal by 2017 without even turning the first sod. That's the claim from the Green Party based on figures from the Parliamentary Library, which calculate the impact of inflation on gambling concessions fixed at 2013 rates... Read more

Martin Aircraft jumps 50% in ASX debut... Read more

Cost of quitting overseas ventures contributes to 93 per cent plunge in profit at power company. Mighty River Power's $69 million writedown on two failed geothermal developments overseas is a lesson for Contact Energy, says an analyst.... Read more

Geothermal exit, dry weather wallop Mighty River earnings... Read more

Spark yesterday reignited the copper pricing debate, hitting out at the Commerce Commission and Chorus after the commission set its draft price at a cost that Spark says is unreasonably high... Read more

Orion hopes glowing report will placate market... Read more

ANZ seeks at least $250 mln from BBB- rated capital note issue likely to have coupon above 7%... Read more

New Zealand's banks had a bumper 2014, with home loan demand amid a booming property market helping to boost their combined profit by more than 20 per cent to a record $4.8 billion, a survey says... Read more

Asaleo Care, the maker of household brands such as Libra, Sorbent, Purex and Treasures that debuted on the ASX last year, posted an 18 percent gain in full year profit, beating its prospectus forecast, and said it expects "low to mid single digit growth" in 2015. The company will pay a dividend of 5.4 Australian cents a share, which is 12 percent above prospectus guidance.... Read more

The sale of Scentre Group’s four remaining 100 percent-owned Westfield shopping malls in New Zealand follows a change in strategy by the Australian parent, says Harbour Asset Management analyst Shane Solly... Read more

Shares of SLI Systems climbed 15 percent after the e-commerce search engine developer boosted its operating earnings 34 percent and said it had enough cash on hand for current growth plans... Read more

Craigs Investment Partners is expanding into Australia and says the move will benefit its clients in New Zealand... Read more

Hutt Valley businesses undecided on Local Government Commission’s Super City proposal... Read more

Jetstar was New Zealand's most punctual domestic airline in 2014 according to on-time performance results... Read more

GeoOp appoints Anna Cicognani as acting head after incoming Ben Foote resigns. The shares last traded at 56 cents, and have climbed 51 percent so far this year... Read more

Solid Energy chair Pip Dunphy has stepped down from the board of the ailing state-owned coal miner before her term expires in October. Dunphy joined the board in December 2012 when the state-owned enterprise went through a board-room clean-out after the failed expansion under past chief executive Don Elder and previous chairman John Palmer... Read more

Kiwibank, the government-owned lender and subsidiary of New Zealand Post, has taken urgent action and frozen some customer accounts after detecting card fraud.... Read more

Bridgecorp's Roest must repay $174k legal aid... Read more

New Zealand investors and advisers relying on the country’s research houses won’t be warned about the market manipulation investigation being conducted into Milford Asset Management... Read more

New Zealand clothing retail chain Bing, Harris and Co is closing down after 157 years in business... Read more

Opinion/Analysis - Liam Dann: Union queries cutbacks after NZ Post announces profit... Read more

Opinion - Simon Terry: TPP backers have questions to answer. Germany fears deals with investor rights and New Zealand can hardly hope to match that country’s clout... Read more





Australian Headlines

Australian Market Report: The Australian sharemarket has reversed earlier losses to close stronger for a second straight day, as local investors pour into blue chip stocks following upbeat corporate earnings. At the 4.15pm (AEDT) official market close, the benchmark S&P/ASX200 index had gained 19 points, or 0.32 per cent, to 5,927, while the broader All Ordinaries index was up 17.6 points, or 0.3 per cent, at 5,890.... Read more

The Australian dollar has drifted lower today as the greenback strengthens in anticipation of US Federal Reserve chair Janet Yellen’s congressional testimony. At 4pm (AEDT), the local currency was trading at US77.73c, down from US78.36c yesterday... Read more

RBA tipped to leave rates on hold at next week’s meeting... Read more

Health groups say the government remains set on bringing in a Medicare co-payment, despite public and backbench MP concern... Read more

MZI Resources strengthens board. MZI Resources has appointed mineral sands executive Dr Stephen Ward as an independent non-executive director with effect from 1st March 2015... Read more

BHP Billiton has scrapped the sale of its US Fayetteville shale assets in the face of weak oil prices, less than four months after it was announced... Read more

Shares rally as BHP Billiton profit plunges 47pc following slump in iron ore and oil... Read more

Falling iron ore prices and production issues have sent Pilbara ore miner BC Iron to a $97 million half year loss. BC Iron shares closed 3.5 cents lower, down 6.6 per cent, at 49.5 cents... Read more

Elysium Resources closer to resource upgrade for New South Wales copper project... Read more

Gippsland Limited has been granted a trading halt by the ASX, with its shares placed in pre-open... Read more

Atlas Iron is scrambling to reduce operating costs after posting a first-half, bottom line loss of $1.1 billion on the back of tumbling iron ore prices. Shares in the company were off 0.5 cents, or 2.44 per cent, to 20 cents shortly before the close of trade.... Read more

Kin Mining's shares are in pre-open following the ASX granting the company a trading halt, pending details of a funding arrangement... Read more

The reopening of the Mount Lyell copper mine on Tasmania's west coast is facing significant delays because of low metal prices. Copper Mines of Tasmania (CMT) said low global copper prices had forced it to review its options and costs... Read more

Kitchen appliance maker Breville is bracing for challenging global economic conditions after a fall in half year earnings. It blamed weaker demand for juicers in North America for a five per cent drop in earnings in the six months to December, while cash flow was stronger in Australia and New Zealand. Breville shares dropped as far as seven per cent on Tuesday but recovered to close one cent lower at $6.98.... Read more

Shares in New Zealand-based jetpack maker Martin Aircraft soared by more than 50 per cent on its ASX debut before settling at a lower altitude, amid strong investor interest. The company raised $27 million in its initial public offering by issuing shares at $0.40 each, with most of the shares taken up by China-based investor KuangChi Science... Read more

Waste management company Tox Free Solutions has posted a 30 per cent jump in first-half profit to $12.4 million. Shares in the company were up eight cents, or 2.83 per cent, to $2.93 at the close.... Read more

Airline operator Regional Express is concerned plunging oil prices could hurt passenger numbers on some rural routes but it's "mildly optimistic" about its outlook. The airline made a net profit of $3.9 million for the six months to December 31, up eight per cent from $3.6 million a year ago... Read more

Technology specialist Hills’ share price has plummeted after it suffered a sharp half year profit drop and forecast a slowing economy hitting its core business. Hills’ share price fell 41 cents, or more than 30 per cent, to 92 cents by 1521 AEDT.... Read more

Australian consumers will be able to pick up items purchased from eBay sellers at Woolworths and Big W outlets in a new scheme that aims to take advantage of the booming online shopping market... Read more

Insurance giant QBE is confident it has finally turned the corner after lifting its full year profit by more than $1 billion. QBE bounced back from last year's $US254 million loss to post a profit of $US742 million for 2014. QBE shares closed 84 cents higher, up 7.24 per cent, at $12.45.... Read more

Insurance claims from Cyclone Marcia jump 60% to $53.4m, but widespread carnage from Oswald in 2013 looks to be averted... Read more

Fixed income trader SC Lowy has hired ex-ING banker, Florian Schmidt, to head its debt capital markets business as the Hong Kong-based firm seeks to expand its foothold in Asia’s booming bond markets... Read more

US regional bank Huntington Bancshares has agreed to buy Macquarie Equipment Finance to expand its technology offerings and presence in Michigan... Read more

Village Roadshow chief information officer David Kindlen will step down from his role and depart the company after 17 years with the business... Read more

Patties Foods, the company whose frozen berries have been voluntarily recalled in response to a Hepatitis A outbreak, has reported a 6 per cent fall in net profit for the six months to December 31 2014. The result covers the period before the voluntary recall started on February 14 2015... Read more





International Headlines

U.S. Market Report: U.S. stocks advanced modestly on Tuesday, with the Dow and S&P 500 at intraday records, as investors attempted to interpret testimony by Federal Reserve Chair Janet Yellen... 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 1.01% while Mexico's IPC is up 0.48% and U.S.'s S&P 500 is up 0.09%.... Read more

European Market Report: European markets finished higher today with shares in Germany leading the region. The DAX is up 0.67% while London's FTSE 100 is up 0.54% and France's CAC 40 is up 0.50%.... Read more

Asian Market Report: Asian markets finished mixed as of the most recent closing prices. The Shanghai Composite gained 0.76% and the Nikkei 225 rose 0.74%. The Hang Seng lost 0.35%.... Read more

Oil turned lower in Asia Tuesday as a feeble rebound failed to take hold, with prices under pressure in an oversupplied market. US benchmark West Texas Intermediate (WTI) for April delivery was down 29 cents to $49.16. Brent crude for April fell 17 cents to $58.73 in afternoon trade, reversing gains in the morning. WTI shed $1.36 in New York and Brent lost $1.32 in London the day before as US crude stockpiles lingered at historic levels, contributing to a global oversupply... Read more

BHP tips US oil growth to peak soon... Read more

The United States is reportedly probing major banks over possible manipulation of precious metals markets. The investigation centres on prices for gold, silver, platinum and palladium,... Read more

The dollar edged lower and bond yields fell after U.S. Federal Reserve Chair Janet Yellen said on Tuesday it would be several months before the Fed expects to raise interest rates, while European equity markets gained after Greece produced a list of proposed economic reforms... Read more

Traders Still Don't Believe the Fed Is Ready to Raise Rates... Read more

US consumer confidence slumps in Feb... Read more

Media sensationalism is distorting consumer confidence data, economist says... Read more

Toll Brothers Inc, the largest U.S. luxury homebuilder, reported a higher-than-expected quarterly profit and raised the low end of its full-year home delivery forecast as housing demand strengthened... Read more

U.S. home prices rise in December: S&P/Case-Shiller... Read more

The U.S. services sector expanded in February at its fastest pace since October, with businesses reporting customers boosting orders because of improving economic conditions, an industry report showed on Tuesday... Read more

More and more, exchange-traded funds that invest in corporate debt are a playground for hedge funds. Take the oldest bond ETF, BlackRock Inc.’s $21.7 billion investment-grade fund: Hutchin Hill Capital, a $3.2 billion manager, bought $431.4 million worth of shares in the last three months of the year... Read more

Local bankers are joining the fight against a congressional proposal to audit the U.S. Federal Reserve's policy decisions, with more expected to lobby against the bill if it gains traction in Washington... Read more

Comcast Still Sees Time Warner Cable Deal Closing as Planned... Read more

Home Depot Inc, the world's No. 1 home improvement chain, posted a better-than-expected rise in quarterly same-store sales on Tuesday but the company warned that a strong dollar will likely hurt 2015 earnings... Read more

Macy's Inc reported a weaker-than-expected rise in sales in the holiday quarter and forecast full-year profit and revenue that fell short of analysts' expectations as it invests in new lower-priced and international stores... Read more

U.S. drone makers are expecting a surge in sales of military and civilian drones to Gulf states after the State Department eased export rules last week, industry executives said on Tuesday... Read more

Comcast Corp, the largest U.S. cable operator, posted fourth-quarter revenue that marginally beat estimates as the company added new video and high-speed internet customers. Comcast's shares closed at $58.21 on Monday on the Nasdaq.... Read more

Greece secured a four-month extension of its financial rescue on Tuesday when its euro zone partners approved a reform plan that backed down on key leftist measures and promised that spending to alleviate social distress would not derail its budget... Read more

Eurozone finance ministers have approved reform proposals submitted by Greece as a condition for extending its bailout by four months, officials say. The Eurogroup said it had agreed to begin national procedures - parliamentary votes in several states to give the deal final approval... Read more

Germany restored its position as Europe’s economic powerhouse last quarter as domestic spending surged and trade contributed to growth. Gross domestic product in the region’s largest economy expanded 0.7 percent in the three months through December, the Federal Statistics Office said... Read more

Oil and gas industry in 'bleak' 2014, finds survey... Read more

The Organisation for Economic Co-operation and Development (OECD) says further progress in UK living standards depends on higher productivity. It says the UK's growth rate is now the highest in the G7 leading nations at 2.6%, but output per worker needs to rise to maintain growth... Read more

Payday lender Wonga says it will cut 325 jobs - over a third of its staff. Wonga says 325 posts are set to go in teams that support the UK business, affecting offices in London, Dublin, Cape Town and Tel Aviv that currently employ a total of 650 people. The Dublin and Tel Aviv offices will close... Read more

Royal Bank of Scotland will hand restructuring chief Rory Cullinan the task of overseeing another major scaling back of its investment bank, sources told Reuters, allowing it to focus on lending to British households and businesses... Read more

Italy and Switzerland have signed a deal to share information in a bid to tackle tax evasion. The deal offers a partial tax amnesty to Italians that have hidden cash in Switzerland. They will have until 30 September to declare their Swiss bank accounts through a "voluntary disclosure procedure."... Read more

Switzerland's financial markets regulator FINMA is unlikely to look into possible wrongdoing at HSBC's Swiss private bank in the light of leaked information that was published this month, FINMA's head of enforcement said on Tuesday... Read more

Visa Europe plans new security that could pave way for Apple Pay... Read more

Builder Mata Pires Becomes Brazil's Latest Ex-Billionaire... Read more

India’s Land Acquisition Amendment Bill. India’s Parliament is debating changes to the country’s land acquisition laws that the government wants to introduce to make it easier for industrial projects to acquire land. Opposition parties and farmers are opposed to the moves that they say would hurt the agriculture sector. Here’s what you need to know... Read more

Indian tax officials searched the Mumbai headquarters of HSBC Holdings PLC last week as part of a probe related to allegations that the bank's Swiss business helped clients dodge taxes, a person with knowledge of the matter said on Tuesday... Read more

Opinion/Analysis - Celia Hatton: Is Weibo on the way out?... Read more

Opinion - Leonid Bershidsky: Germany Gives Greece a Short Leash... Read more

Opinion - Peter Cai: Is China really the world’s largest exporter?... Read more

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