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First Up

The ASX rose sharply in early trade, up 67pts at the get go before the rally ran out of steam in the afternoon, void of the backbone provided by the banks, while U.S futures came under pressure late in the session when China announced an investigation into Google for alleged antitrust violations and imposed new tariffs on US products in response to Trump’s 10% tariff on goods from Beijing.

The new tariffs include 15% levies on coal and liquefied natural gas and 10% on oil and agricultural equipment from the US, as well as export control on tungsten-related materials and adding certain companies to an unreliable entity list.

It will be interesting to see the response from the President, as China levels up the playing field ahead of negotiations it would seem, if Mexico and Canada are a guide.

  • The ASX200 was down –5pts/-0.06% closing at 8374
  • Technology (+1.52%), Materials (+0.93%) and Healthcare (+0.01%) the three sectors higher.
  • Real Estate (-1.06%), Consumer Discretionary (-0.76%) & Energy (-0.73%) weakest on the day.
  • Seek (SEK) was unchanged after it could not get the $42.1m acquisition of Xref (XF1) -22.58% through the shareholder vote sending the ASX junior tumbling.
  • As a refresher, XF1 is a human resources technology company that has automated reference checking services, police checks and the like.
  • Pro Medicus (PME) +5.18% continued to climb after a $53M contract win with Florida-based Baycare.
  • Nufarm (NUF) +3.37% gave a decent trading update, reaffirming guidance. More on this below.
  • Sigma Healthcare (SIG) +0.36% confirmed the scheme of arrangement to acquire all shares in Chemist Warehouse is now final, with new SIG shares to start trading 13 February.
  • News Corp (NWS) +1.83% ticked up after a UBS upgrade from neutral to a buy rating and put a $64.50 price target – the stock reports half-year earnings Thursday. Shares closed at $51.74.
  • Predictive Discovery (PDI) +13.21% soared after selling a 10% equity stake to strategic mining investors, Chinese multinational Zijin and Candian-based Lundin, raising $69.2M.
  • Gold up a modest US$2 during the session, trading at $US2817oz at our close.
  • Trading mostly positive throughout Asia with Hong Kong up +1.3%, Japan trading +0.4% higher and China flat.
  • Iron Ore in Singapore was flat, trading $101.50/MT.
  • U.S futures are all lower, Dow 0.3% lower, SP500 and NASDAQ both down –0.5%.
  • UBS Group (UBS US), Chipotle (CMG US) and Alphabet (GOOGL US) reporting tonight – we hold all three in our International Equities portfolio
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ASX200 Index
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