The Overnight Report: Cheers

Array
(
    [0] => Array
        (
            [0] => ((BPT))
            [1] => ((NXT))
            [2] => ((EVN))
            [3] => ((S32))
            [4] => ((AHG))
            [5] => ((CCL))
            [6] => ((WEB))
            [7] => ((IGO))
            [8] => ((PRU))
            [9] => ((ORE))
            [10] => ((MYR))
            [11] => ((KMD))
            [12] => ((SHV))
        )

    [1] => Array
        (
            [0] => BPT
            [1] => NXT
            [2] => EVN
            [3] => S32
            [4] => AHG
            [5] => CCL
            [6] => WEB
            [7] => IGO
            [8] => PRU
            [9] => ORE
            [10] => MYR
            [11] => KMD
            [12] => SHV
        )

)

This story features BEACH ENERGY LIMITED, and other companies.
For more info SHARE ANALYSIS: BPT
The company is included in ASX200, ASX300 and ALL-ORDS

By Greg Peel

Flat

The ASX200 opened slightly higher yesterday before chopping around on low volume and not going anywhere much at all. That changed around 2pm when the index dropped -20 points over the next hour before recovering to close the session flat.

The drop came as China announced a clamp-down on internet-based micro-lending.

China’s large banks have never been keen on small loans hence the past couple of years have seen an explosion in micro-lending in the country. Following an early round of scandals, fraud and P2P failures, Beijing stepped in and began attempts to regulate the industry. As China’s level of household debt rises, government concern has now led to further restrictions.

The Shanghai index fell -3%.

Beyond the China news, the local market was again focused on those companies holding AGMs this week. AGM-wise yesterday’s was a positive session, with all of Beach Energy ((BPT)), NextDC ((NXT)), Evolution Mining ((EVN)) and South32 ((S32)) hitting the leaders’ board with 2-3% gains in the wake of their meetings either yesterday or the day before.

The winner on the day was otherwise Automotive Holdings Group ((AHG)), which rose 6.9% after announcing it had finally divested itself of the ball and chain that was its refrigerated logistics business, clearing the way for its continually successful auto business to shine alone.

On the flipside, Coca-Cola Amatil ((CCL)) has heard the bells tolling and decided to throw its efforts behind promoting the beverages in its suite that aren’t fizzy, such as iced tea and fruit juice, in order to jump on the prevailing health trend rather than continue to fight it. Coke will do this by investing heavily and cutting prices. Hence its shares fell -4.9%.

Having been carted on Wednesday following the release of disappointing guidance at its AGM, Webjet ((WEB)) yesterday fell another -6.7% to again top the losers’ board.

Beyond individual stories, the resources sectors were the best performers yesterday on strong oil and iron ore prices, rising 0.7% each. Utilities proved the loser with a -0.7% drop as volatility in that sector continues, despite it being supposedly defensive.

The banks also weighed, down -0.4% as the Treasurer called in the chiefs for a grilling as calls for a Royal Commission – not just from Labor but from some Nationals as well – grow. It must be fun to run a big bank at the moment.

With the US closed overnight, it is difficult to see today as delivering much more than more of the same. Once again there are quite a few AGMs in the spotlight. The futures are down modestly this morning.

Alors!

Had Wall Street been open, traders may have responded positively to the news the eurozone’s composite PMI (manufacturing and services) has jumped to its highest level since April 2011, at 57.5, according to the November flash estimate. It was around 2011 the world was worried about the PIIGS, a Grexit, and the general disintegration of the eurozone.

The biggest surprise was a solid PMI jump for France. While the German economy has powered ahead in recent years, France has struggled to gain traction, but now looks like turning the corner. Vive Macron!

The French stock index rose 0.5% last night while both London and Germany were flat, as one stewed over Brexit and the other over a lack of government.

Commodities

The euro rose on the PMI news and thus the US dollar index is down -0.1% at 93.11.

Base metal prices barely troubled the scorer last night, other than a -0.8% fall for nickel.

West Texas crude added another US50c to US$58.48/bbl in thin electronic trade. Among all the other issues driving the oil market at present, a rupture in the major Canada-US pipeline this week is also supporting prices.

Gold is steady at US$1290.60/oz.

Iron ore continued its run higher.

The Aussie is up 0.3% at US$76.30.

Today

The SPI Overnight closed down -7 points.

It’s a half-day session on the NYSE tonight manned only by a handful of skeletons. They’ll nevertheless be focused on updates on just how Black Friday sales are progressing, although most admit Black Friday is becoming a bit of an anachronism given retailers start offering “Black Friday” discounts from the beginning of the week and beyond and some stores are now opening on the Thanksgiving Holiday.

Cyber Monday is beginning to draw more attention.

Locally, today’s list of AGMs includes miners Independence Group ((IGO)), Perseus Mining ((PRU)) and Orocobre ((ORE)) and fittingly, Myer ((MYR)) on the day Amazon supposedly invades. Kathmandu ((KMD)) and Select Harvests ((SHV)) also front the shareholders.

Rudi will Skype-up with Sky Business around 11.15am to talk broker views and upgrades and downgrades.

****

The Australian share market over the past thirty days…

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