The Overnight Report: Go Away In May

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            [1] => ((MQG))
            [2] => ((ELD))
            [3] => ((NCM))
            [4] => ((GMG))
            [5] => ((CHC))
            [6] => ((IVC))
            [7] => ((PBH))
            [8] => ((JHX))
            [9] => ((360))
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            [1] => MQG
            [2] => ELD
            [3] => NCM
            [4] => GMG
            [5] => CHC
            [6] => IVC
            [7] => PBH
            [8] => JHX
            [9] => 360
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)

This story features ANZ GROUP HOLDINGS LIMITED, and other companies.
For more info SHARE ANALYSIS: ANZ
The company is included in ASX20, ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

By Greg Peel

I Got You Babe

Yes, Sonny & Cher were on the radio when the local market opened yesterday before the ASX200 fell -21 points in the morning and rallied back in the afternoon to close up 10, just as it had done, thereabouts, in the previous three sessions.

We could argue nonetheless this time it might have been more positive if ANZ Bank ((ANZ)) and Macquarie Group ((MQG)) hadn’t chosen the same day to go ex-dividend, ensuring the bank sector fell -0.9% and was, but for a less than -0.1% fall in staples, the only sector to close in the red.

Staples’ fall included a -13% plunge for Elders ((ELD)) after reporting a -47% fall in profit and a dividend cut, to prove not all ag stocks are the same.

The counter, believe it or not, were the resource sectors after the PBoC, believe it or not, injected more long-term liquidity into the financial system for the sixth month in response to the weak data that keeps flowing out of China.

Materials rose 0.8% and energy 0.6%.

Gold miners were also in the spotlight after Newcrest Mining ((NCM)) agreed to the takeover bid from US giant Newmont. There goes another one.

The surprise sector move was in real estate (+0.9%), despite 9-10 point increases in Aussie bond yields, driven by the big property managers Goodman Group ((GMG)) and Charter Hall ((CHC)).

Consumer discretionary gained 0.5% after private equity came in with a renewed bid for InvoCare ((IVC)), sending it back up 12.1%.

On the flipside, in the ASX300 at least, was a -21.1% fall in PointsBet Holdings ((PBH)) after it agreed to sell its US assets to US betting shop Fanatics. Clearly, the market saw upside to US gambling as state after state legalises sports betting to rein in what had already been a booming black market.

Locally, the push is on to get rid of it, or at least the inundation of ads. Digital betting shops have been popping up in the US like mushrooms after spring rain and the market is screaming for consolidation. PointsBet was over 8% shorted as of last week so there’ll be some happy punters.

Beyond discretionary, sector moves were minimal.

So it appears we need to rely on M&A for any action in the local market at present, amidst much debate about what the RBA will do next, what the Fed will do next, and whether the US is about to default for the first time in history.

But fear not, after a wild night on Wall Street our futures are…umm… down -1 point this morning.

Ceiling a Deal

Actually, Wall Street saw anything but a wild ride last night but ultimately the Dow broke a five-day winning streak and the Nasdaq flipped back to the positive again.

Talk is Biden and Congressional leaders may meet tonight. Biden, having refused to budge up to this point, suggested on the weekend “there’s a desire on their part as well as ours to reach an agreement” while McCarthy said the two sides remain “far apart”.

Wall Street is not flustered, as the stock and bond markets confirm, but not prepared to take any big bets right now either.

The assumption is Biden will make a few concessions and thus be the saviour of the American people, allowing McCarthy to claim victory and appease the far right fruitcakes to whom he’s beholden, and then they’ll have a laugh over a beer at the clubhouse just as the clock strikes midnight.

In the meantime, Wall Street treads water. There may be a response tonight when US April retail sales numbers are released, but otherwise it’s all about the ceiling, and then the Fed meeting, with the former potentially to play out over another two weeks and the Fed meeting not until late June.

Regarding Wall Street’s current fascination with Australia, Newcrest shares rose only 1.5% yesterday on the takeover news as it’s been in play for a while, but Newmont rose 2.5% in New York.

Fanatics is not publicly listed, yet.

Commodities

The PBoC injection spurred some buying in commodities but as this is the sixth recently, with no impact yet felt, it was tentative.

Yet the Aussie still shot up 0.8% to US$0.6703 and forex traders must by now be feeling giddy.

Today

The SPI Overnight closed down -1 point.

We’ll see more evidence of China’s economic rebound, or lack thereof, today when April industrial production, retail sales and fixed asset investment data are released.

The minutes of the May RBA meeting are out today.

The US will also see retail sales and industrial production along with housing market sentiment.

Quarterly earnings results are out today from James Hardie ((JHX)) and Life360 ((360)).

The Australian share market over the past thirty days…

For more detail go to FNArena's Australian Broker Call Report, which is updated each morning, Mon-Fri.

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