Australian Investment Blog

• The ASX200 slid below 5200 points, led down by NAB which was trading ex-div, after a broad sell-off on Wall street stalled on the back of Fed chair Janet Yellen talking up the chance of a December rate hike. The market is pointing to a 50% chance of a hike in December with a near-term fed fund futures contract falling to the lowest levels in a month or longer. We are leaning towards a rate hike in the US in December and feel this is a healthy thing for markets as the longer it is put off delays the inevitable.
• NAB shares hit a two-year low closing at $28.56, down 4.51%, trading ex-dividend. CBA closed 1% lower to $75.85, while ANZ closed 0.8% lower at $26.65, and WBC 0.51% lower to $31.10.
• Glenn Stevens has been quoted saying any rate move would ‘almost certainly’ be a cut, but he has also showed he is in no hurry. We think lower rates are here for longer and the cash rate could find itself below 2% over the short to medium term.
• CBA’s quarterly profit edged up as, quite surprisingly, bad debts continued to fall. CBA is well held in the Market Matters portfolio, and is something we would look at either adding to into weakness or for sophisticated investors selling calls on anticipated weakness.
• Miners weren't much help, with BHP down 0.8 per cent and Rio 1.4 per cent. South32 managed a 1 per cent gain, however. Woodside gained 1 per cent and was the biggest single point of support for the ASX 200. Our only real exposure in this space is currently STO and OSH which both held up ok with STO up 0.33% and OSH coming back strongly intraday to be down only 1% at the close.
• The Australian Competition and Consumer Commission today approved the $3 billion merger between M2 Group, which owns Dodo and iPrimus, and Vocus Communications in a move that will create the fourth-largest telecommunications provider in Australia. Earlier this year TPG Telecom bought Perth-based rival iiNet for $1.56 billion. We used this announcement to take profit on our VOC in September.
• The gold sector closed weaker again, following the movements from its underlying commodity. Newcrest Mining (NCM) lost 3.3% to $11.89, while Regis Resources (RRL) closed 3.8% lower to $2.01. We recently recommended closing out gold longs, and are now sitting watching for potential future opportunities.

Best Sector – Health Care
Worst Sector – Financials

Winners and losers chart

Winners
Paladin Energy Ltd (PDN) +$0.025, or (+9.6%) to $0.285
Credit Corp Group Ltd (CCP) +$0.7, or (+8.1%) to $9.35
Metcash Ltd (MTS) +$0.045, or (+3.6%) to $1.31
Independence Group NL (IGO) +$0.09, or (+3.2%) to $2.86
Losers
Transpacific Industries Group (TPI) -$0.03, or (-4.4%) to $0.65
Liquefied Natural Gas Ltd (LNG) -$0.08, or (-5.2%) to $1.46
APN News & Media Ltd (APN) -$0.035, or (-6.7%) to $0.485
Ardent Leisure Group (AAD) -$0.39, or (-13.6%) to $2.48

Fear and greed index

ASX 200 day chart

All figures contained from sources believed to be accurate. MarketMatters does not make any representation of warranty as to the accuracy of the figures and disclaims any liability resulting from any inaccuracy. Prices as at 5/11/2015. 4.14PM.
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