Trading Day: live markets coverage, plus analysis and opinion
A final boost has helped the local market to finish flat, with Crown the clear outperformer.
- Home loans better than expected
- Crown surges to 7-month high
- Lynas a ‘rare opportunity’ for WES
- Budget cuts fail to boost confidence
That’s it for the Trading Day blog for Tuesday, April 9. Highlights today were the ANZ consumer sentiment, ABS home loans data and a speech by the RBA’s Guy Debelle.
Bridget Carter 5.54pm: Life360 IPO priced at $US500m-$US550m
Life360 set to price as a company worth US$500m to $550m for its initial public offering.
4.32pm: Late boost cements flat finish
A final burst of strength has pushed the local market to a flat close on Tuesday, paring losses of as much as 0.3 per cent.
Iron ore prices continued upwards to hit five year highs overnight on supply concerns, what again helped local miners.
BHP added 0.35 per cent to $40.03, Fortescue by 2.38 per cent to $8.20 while Rio Tinto edged just 0.1 per cent higher to $101.58 after it announced it was going ahead with a $US463 million investment in its majority-owned Richards Bay Minerals.
The major banks were the biggest detractor from the index – Commonwealth Bank shed 0.59 per cent to $70.25, Westpac slipped by 0.15 per cent to $25.84, NAB by 0.45 per cent to $24.59 and ANZ by 0.58 per cent to $25.65. Macquarie slipped by 0.34 per cent to $130.39.
The best performer on the market was casino operator Crown Resorts after announcing a $10 billion takeover approach from Las Vegas resort powerhouse Wynn Resorts.
The stock jumped by 19.7 per cent to $14.05 on the news, and as much as 7-month highs of $14.37.
Rival Star Entertainment was also buoyed on the news, finishing 5.43 per cent higher to $4.47.
The Aussie dollar edged higher on a bounce in home lending data, last up 0.21 per cent at US71.41c.
4.12pm: Energy, tech push ASX to positive
Energy and tech stocks have together kept the local benchmark afloat in Tuesday’s trade, fighting off a drag from the major banks to push it to a flat close.
Despite expectations of a rise, the ASX200 fell as much as 0.3 per cent early, to lows of 6203.7 in the first hour but pushed to as much as 6228.9 as major miners gained traction.
The benchmark closed out the session just 0.4 points higher at 6221.8, while the All Ords edged 5 points higher to 6315.5.
3.51pm: Bendigo cuts variable rates
Bendigo bank has cut the variable interest rates on two of its home loan products by as much as 0.2 per cent.
Its express home loan for owner occupiers will decrease by 0.1pc per annum to 3.79pc, while its Basic Home loan will be cut by 0.2pc to 3.79pc pa.
Changes will take effect on April 12.
“We believe the decision to reduce rates on these products will prove timely for customers looking for a great value mortgage along with the fantastic customer experience for which our Bank is famous,” consumer banking exec Richard Fennell said.
“This decision underscores our commitment and vision to be Australia’s bank of choice whether that choice is to apply online with the Bendigo Express instant home loan or in person with Bendigo Basic.”
BEN shares last down 0.41pc at $9.82.
3.31pm: Star boosted on casino interest
Crown Resorts is the best performer on the benchmark after the casino operator confirmed it had been approached for takeover by US group Wynn, what investors are tipping could help the broader casino market.
Hot on the heels of Crown’s rise, rival Star Entertainment - operator of The Star Sydney and Gold Coast and Treasury Brisbane - has jumped 6.6 per cent to a one-mont high of $4.56.
SGR last at $4.47.
2.35pm: Investment banks court Aveo
Investment banks JPMorgan and Credit Suisse have emerged in and around the action for the sales process of the $1.08 billion retirement village operator Aveo.
It is understood JPMorgan is funding a tilt by Blackstone.
Blackstone’s involvement in the process was first revealed by DataRoom, although some had suspected in recent days that it may have no longer been in the mix, but that is now not thought to be the case.
Credit Suisse is also understood to be providing funding for what is thought to be one of two groups competing to buy the Bank of America Merrill Lynch-advised company.
Apparently, Aveo’s management team had recently been expressing confidence in the way the sales process was progressing.
The speculation has lifted Aveo trade, the stock hitting as much as $2 in Tuesday’s trade - last up 1.04pc at $1.95.
Ben Wilmot 1.56pm: Developers swoop on unwanted resi
Hong Kong-based Far East Consortium has snapped up a major development site in Melbourne’s central business district for $90 million in a counter-cyclical play that will see it develop a 68-storey apartment tower.
The purchase of the site at 640 Bourke Street from Shanghai-backed developer Besgate comes amid a switch in the market that has seen a series of office property groups swoop on unwanted apartment sites.
Besgate has also sought to exit its holdings in Melbourne as the city’s apartment market slows down and prices come under pressure.
12.36pm: Telstra names new CFO
Telstra says Vicki Brady, former head of consumer and small business, will take over as the telco’s chief financial officer and head of strategy.
She replaces Robyn Denholm, who is leaving to be chair of Elon Musk’s Tesla.
CEO Andy Penn says Ms Brady will start in her new role on July 1. Acting group executive
Michael Ackland will be permanently appointed to lead the consumer and small business function.
12.25pm: Can the ASX stay in positive trade?
The local market has edged into positive territory at lunch, helped by a pick up in the materials sector and continued strength in tech and energy.
The benchmark ASX200 is up by 4 points at 6225.2 after paring losses as much as 0.3pc in morning trade.
Crown Resorts continues to be a standout as investors weigh a $10bn takeover bid from Vegas heavyweight Wynn. Its shares are 21 per cent higher at $14.23.
That news has also helped peer Star Entertainment - the stock up 5.66pc.
Meanwhile, the major miners are strong led by Fortescue up 2.4pc - Rio is 0.33pc higher and BHP by 0.25.
Its the major banks that are the biggest drag on the index - Commonwealth is down by 0.78pc, Westpac by 0.48pc, ANZ by 0.68pc and NAB by 0.6pc.
Macquarie is down by 0.5pc.
11.56am: Margin concerns for CSL: Deutsche
Deutsche analyst Craig Wong-Pan has kept his Hold rating on CSL and trimmed his target price 2.5 per cent to $198 after visiting its US headquarters.
He says the heavyweight health stock has a strong revenue outlook but some margin concerns.
While gaining comfort over our FY20 immunoglobulin revenue growth forecasts and reduced risks associated with obtaining the Chinese approval of AlbuRx, he notes that US collections are moving into different demographics which in his view could lead to lower plasma yields and lower margins.
At the same time, HAE production will be increased significantly and investment is being made into manufacturing CSL112 while phase III trials are being undertaken.
“We continue to rate the stock a Hold given the limited total shareholder total shareholder return,” he says.
CSL last up 0.8pc at $202.12.
Nick Evans 11.39am: Rio fire knocks out screening facility
Yet another setback for Rio Tinto’s Pilbara iron ore operations are likely to underline investor sentiment backing surging iron ore prices, after the mining giant this morning a fire at its Dampier port operations knocked out a screening facility.
It is the second fire at one of Rio’s screening plants this year, after a fire at Rio’s nearby Cape Lambert terminal impacted exports in January.
A spokesman for Rio confirmed a fire had broken out on the weekend, and had been brought under control with no injuries.
While shipments have resumed from its Dampier terminal, far smaller than its main port at Cape Lambert, the screening facility remains closed and it is unclear whether the damage will force longer term closure and other revision to Rio’s expected Pilbara export numbers.
Last Rio said the earlier fire at Cape Lambert, plus the impact of Cyclone Veronica, was expected to strip 14 million tonnes from its forecast exports this year, sending iron ore prices surging.
The iron ore price is closing on $US95 a tonne this week, its highest level in years.
Rio shares were up 29c in early trading, at $101.77.
11.35am: Home loan data beats estimates
February home loans data have beaten market estimates, particularly for the important owner-occupied category.
The number of home loans rose 0.8pc on month, slightly above Bloomberg’s 0.5pc consensus estimate but the value of owner-occupied loans jumped 3.4pc, well above the 1pc expectation.
The number of investor loans rose 0.9pc versus an expected 1pc fall.
The Australian dollar rose slightly from 0.7124 to 0.7131.
Perry Williams 11.30am: Oil Search signs PNG LNG agreement
Oil Search has signed a gas agreement with Papua New Guinea’s government, a key milestone to kickstart a planned $US13 billion ($18.4bn) expansion that’s set to double LNG volumes from the South Pacific nation.
The fiscal framework underpinning Papua LNG — a joint venture between energy giants Total, ExxonMobil and Oil Search - will include a deferred payment mechanism for the PNG government to lower the financial burden of taking up its 22.5 per cent interest in the project.
It’s understood state-backed oil company Kumul Petroleum — which is being advised by Lazard — will be required to tip in about $US1.4 billion as part of the expansion project.
Oil Search will hold a 17.7 per cent stake with Total owning 31.1 per cent of the venture and Exxon the 28.7 per cent remainder.
The gas pact will also include a domestic market obligation to develop local industry and provide sufficient local power generation.
The three energy companies will move into a front-end engineering and design phase with a final investment decision due in 2020 and first LNG by 2024.
11.14am: Home loans expected to rise
February Housing Finance data are due at 1130 AEST.
Economists are expecting a 0.5pc on month rise in home loans, according to Bloomberg.
Owner-occupied loan value is expected to rise 1pc and the number of investor loans is expected to fall 1pc.
“Home loans data have shown ongoing weakness in the housing market,” says NAB’s head of FX strategy, Ray Attrill.
“While NAB and the market are expecting a small rise this month, the trend for home loan approvals has been downward for owner occupiers and investors.
The weakness is most pronounced in NSW and Victoria, and in investor loans.”
10.55am: Bank slide restrains ASX
The Australian sharemarket has turned down amid a further slide in banks.
The S&P/ASX 200 is down 0.3 per cent at 6204 despite a 0.3pc rise implied by overnight futures.
The four major banks are down 0.6pc-0.8pc and Macquarie is off 0.8pc.
That’s outweighting a 20pc jump in Crown after a takeover bid from Wynn Resorts, which is also rubbing of on Star Entertainment.
Energy stocks are surging on the higher crude oil price with Beach Energy up 3.2pc and Santos up 2.4pc.
But South32 is down 2.6pc after it was cut to Sell by Goldman Sachs.
Wesfarmers is down 0.9pc after saying its open to engage with Lynas on its takeover proposal.
ASX200 last at 6211.1.
10.44am: Trump to impose $11bn tariffs on EU
The Trump administration moved on Monday toward imposing tariffs on about $US11 billion in imports from the European Union, saying the move was justified by the bloc’s subsidies for aircraft manufacturer Airbus.
The USTR has been in litigation at the World Trade Organization over the case of Airbus subsidies since 2004, and said it was releasing a list of items proposed for tariffs in anticipation of a ruling soon from the WTO on the case.
“This case has been in litigation for 14 years, and the time has come for action,” US trade representative Robert Lighthizer said.
“Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft. When the EU ends these harmful subsidies, the additional US duties imposed in response can be lifted.”
Though the tariffs are in response to the WTO case, the move is sure to ratchet up tensions between Washington and Brussels, where negotiators have struggled for nearly a year to make progress on proposed trade talks.
Dow Jones
10.39am: Crown surges to 7-month high
Shares in Crown Resorts jumped 22pc to a 7-month high of $14.33 after it confirmed a $10 billion takeover approach from Wynn Resorts at a 26 per cent premium to its last close.
As usual with preliminary and conditional offers, it’s not without some risk, so some investors are obviously cashing in on today’s rise.
The move has also helped casino peer Star Entertainment, last up 5.43pc to $4.47.
10.34am: Lynas a ‘rare opportunity’ for WES
Lynas is a “rare opportunity” for Wesfarmers and makes “strategic sense” as part of the move out of coal into electric vehicles exposure, according to Macquarie analyst Rob Freeman.
While the bid was a “genuine surprise” to the market given the perceived more ‘defensive’ characteristics of Wesfarmers businesses, Mr Freeman says it always indicated it is focussed on growth (risk adjusted) and Lynas would facilitate this.
“We view Lynas as a ‘new world’ chemical play given the EV theme,” he says. “We believe other previously mooted targets (like Incitec Pivot and Orica) are less likely as these are ‘old world’, such as coal that was divested by WES in 2018.”
He notes that the Malaysian waste solution will involve capital via removal of product outside of Malaysia, adding that “we understand the WA government is unlikely to accept waste without some production benefit locally”.
With WES seeking to leverage its existing infrastructure and expertise in WA, its “edge may be a desire to increase the production of the Mt Weld mine potentially via the construction of a new rare earth processing plant in WA.”
The broker has an Outperform rating and $37.13 target on Wesfarmers. Last down 0.9pc at $34.14.
10.20am: Wynn circles Crown in $10bn takeover
Crown Resorts has confirmed it is in talks with Wynn Resorts regarding a confidential takeover proposal involving both cash and scrip.
The proposal contemplates the acquisition of Crown by Wynn via a scheme of agreement with 50 per cent given in cash and 50pc in Wynn shares - an implied value of $14.75 and what is a 26 per cent premium to Crown’s last closing price.
“The proposal is subject to a number of conditions including due diligence, Wynn obtaining all necessary regulatory approvals and a recommendation by the Crown Board. It is stated to be preliminary, confidential, non-binding and indicative,” Crown said, noting it had not yet considered the proposal.
Goldman Sachs and UBS are acting as financial advisers and Ashurst as legal adviser to Crown.
10.16am: Lynas updates growth plans
Takeover target Lynas has confirmed its primary locations for a new processing facility are in Western Australia, as it caves to pressure from the Malaysian government to move processing away from the south-east Asian nation.
In a note to the market this morning, Lynas said it had been developing plans to mitigate regulatory risk in Malaysia.
“Our preference has always been to add to our Malaysian capability, not replace it,” it said.
“We remain committed to supporting the Malaysian economy and protecting our people’s jobs. However, this same work means we are well placed to deal with any change in Malaysian government policy.”
It said it was accelerating planning work given the takeover offer from Wesfarmers lobbed last week.
LYC remains halted, last at $2.12.
10.15am: US investors ‘complacent’: MS
US sharemarket investors are “complacent” and unwilling to “fight the Fed” but maybe they should be according to Morgan Stanley CIO Lisa Shalett.
“US sharemarket earnings estimates are falling, first-quarter GDP is likely to be weak and the Federal Reserve switched policy on fears of slowing growth, yet the equity market has charged higher,” she notes.
“In our view, it’s doing so on the premise that a Fed-engineered soft landing and lower real interest rates would support higher price/earnings multiples.”
And with markets now up more than 15 per cent for the year to date, she argues that traders now seem to be wagering that the large cash reserves on the sidelines will keep markets going higher because of investor ‘FOMO’ (fear of missing out).
Ms Shalett notes that with investors unwilling to position against the Fed, hedges that would protect against a market downturn and a pick-up in volatility are at levels last seen in March 2009, when the S&P 500 was at a multiyear low.
But now the S&P 500 is within 1 per cent of an all-time high.
Nick Evans 10.04am: Rio tax bill highest since boom
Rio Tinto’s Australian tax payments surged last year as Canberra brawled over the corporate tax rate, according to the company’s latest tax transparency report, with the mining giant handing over $US3.2 billion ($4.2 billion) to the tax office in 2018.
Australia is home to about half of Rio’s operating assets and its most profitable division, iron ore, and the company said this morning it also paid out $US1.45 billion in State Government royalties and another $US666 million in state-levied payroll taxes on its 19,000 local workers.
With its Australian operations generating underlying before-tax earnings of a touch over $US10 billion in 2018, Rio said its effective corporate tax rate on those earnings was 30.7 per cent.
The ATO’s $A4.2 billion tax-take from Rio in 2018 was its highest since the heights of the mining boom in 2012, when the company chipped in $A5.1 billion into the treasury’s coffers, and another $A1.9 billion in state government royalties.
9.58am: Lynas paused
A second major pause in trade announced within just 6 minutes, Lynas Corporation is set to make an announcement to the market later this morning.
The rare earths miner yesterday held a teleconference to address comments from Malaysian Prime Minister Mahathir Mohamad, and bowed to pressure to shift its radioactive waste processing component to Australia.
9.52am: Crown Resorts trade paused
Trade in Crown Resorts has been paused, pending a further announcement, amid speculation US resorts powerhouse Wynn is circling the local casino operator.
It is anticipated that the pause will be followed by a halt in the company’s trade as it responds to the reports.
CWN last traded at $11.74.
9.49am: Wesfarmers open to Lynas negotiations
Wesfarmers has this morning told the market it is open to breaking down some conditions in its takeover proposal for Lynas.
Responding to comments from the Malaysian Prime Minister Mahathir Mohamad at the weekend, and speculation of Lynas constructing a local processing facility, Wesfarmers said it was a positive step.
“With greater clarity around licence renewal and Lynas’ plans to address these licence conditions, Wesfarmers remains open to engage with the Lynas Board on our Proposal, with a view to progressing a less conditional proposal,” Wesfarmers Rob Scott told the market.
“Wesfarmers is a disciplined, principled investor with opportunities to invest across a range of sectors, in addition to our core businesses.”
9.43am: Ansell costs improving: Macquarie
Macquarie analyst David Bailey has reiterated his Outperform rating and $28.20 target price on Ansell.
He says that while macroeconomic trends are indicative of only modest organic revenue growth, raw material prices remain favourable and present upside to forecasts for the first half of fiscal 2020, if sustained at current levels.
The price of butadiene, a major ingredient in rubber, moderated over the second half of 2018 in line with lower oil prices, with prices remaining lower over the March quarter, while pricing for natural rubber latex also remains favourable relative to prior periods.
Along with planned price increases for 4QFY19, he sees these factors as supportive of gross margins in 2H19 and into FY20. It should be noted though that WTI crude oil has risen 52 per cent from its December low.
“Combined with balance-sheet flexibility, incremental benefits from the Transformation Program and undemanding valuations, these factors support our investment view,” Mr Bailey says.
9.40am: Budget cuts fail to boost confidence
Consumer confidence fell last week after federal budget tax cuts apparently failed to cheer Australians, ANZ analysts say.
The ANZ-Roy Morgan Australian Consumer Confidence index slid by 1.3 per cent from the previous week, with the “time to buy a household item” metric tumbling 7.4 per cent.
“The fall in confidence last week would be seen as disappointing in Canberra given the near-term boost to household incomes delivered in the budget,” ANZ economist David Plank said.
AAP
9.12am: Casino operators in focus
Punters will be watching for any share price movement in Crown Resorts and Star Entertainment at the open, after reports US resort powerhouse Wynn was circling Crown.
The $US15.6 billion Wynn operates high end hotels and casinos and is based on the Las Vegas strip.
According to reports, Wynn is looking to initiate talks with Crown but the target has knocked back the approach at this stage.
Crown operates casinos in Melbourne and Perth and is developing the luxury Crown Sydney in Barangaroo.
9.06am: Commodity strength points to ASX rise
The resources sector look set to lead the sharemarket higher again today after solid gains in commodity prices.
Overnight futures point to a 0.3pc opening rise in the S&P/ASX 200 after slight gains on Wall Street.
A break above 6227 could see a retest of last week’s 7-month high at 6287.9.
But the recent triple bearish divergence on daily RSI argues for caution near the top of the 6096.8-6187.9 trading range.
The S&P 500 and Nasdaq rose 0.1-0.2pc, while the DJIA lost 0.3pc as Boeing fell 4.4pc.
Energy led the S&P 500 as WTI crude rose 2.2pc to $US64.44 amid threats to supply from Libya and Venezuela.
Bulks were strong with spot iron ore up 2pc to $US93.60 a tonne and coking coal up 3.1pc to $US201.
Dailian iron ore futures were up 1.7 per cent after rising as much as 2.7 per cent overnight.
Spot gold rose 0.5pc to $US1296.90 per ounce, while base metals were mixed with aluminum down 1.1pc, zinc down 0.6pc, copper up 1.1pc and nickel up 0.9pc.
BHP ADR’s equivalent close at $40.08 was a 0.5pc premium to BHP’s close in Sydney.
Domestic housing finance data for February are due for release at 1130 AEST.
Index last 6221.35.
[CHART] ASX 200 set for modest gains at the open after SPI futures end after hours session with a gain of 10pts #ausbiz Bloomberg pic.twitter.com/BiOriTNUvK
— CommSec (@CommSec) April 8, 2019
9.03am: What’s impressing analysts, what’s not
Envirosuite started at Buy - Bell Potter
Flight Centre cut to Sell - Morningstar
Oil Search cut to Neutral - JPMorgan
Senex raised to Neutral - JPMorgan
South32 cut to Sell - Goldmans
Nick Evans 8.58am: MinRes launches $US750m bond raise
Mineral Resources has launched a $US750 million bond offering, seeking to consolidate its debts as it finalises construction of its lithium processing facilities in the Pilbara.
The company launched the debt offering this morning, saying it would tap the US debt markets to issue $US750 million in unsecured senior notes, repayable by 2027.
Mineral Resources finished December with $716.5 million in borrowings, including $72.5 million in lease liabilities, declaring half-year earnings before interest, tax, depreciation and amortisation of $72 million, down $280 million on the first half of the previous financial year.
The Chris Ellison-led company has said it expects to finalise construction of its Wodgina lithium facilities in the current quarter, as well as reach steady-state production of iron ore from its Koolyanobbing mine in the south of WA.
MinRes shares last traded at $16.95.
Bridget Carter 8.51am: IPH lifts Xenith bid
IPH has lifted its offer for takeover target Xenith following “constructive” negotiations between the intellectual property firms.
Xenith last month rebuffed IPH’s initial takeover offer, saying its $2.02 offer was not superior to a proposed merger with Qantm.
IPH’s sweetener comes after a recent rally in its share price.
The new IPH offer for its smaller rival is for a combination of cash and IPH shares valued at $2.15 per Xenith share. However, it also includes a “mix and match” facility allowing Xenith shareholders to elect to receive up to 100 per cent of that price in cash or scrip alone, subject to scale-back.
“IPH believes the revised IPH proposal provides compelling benefits for Xenith’s shareholders, its leading IP attorneys and other stakeholders,” IPH told the ASX last night.
8.45am: Bumper demand for Appen raise
ASX-listed AI firm Appen could have raised more than three times the $15 million generated by its share purchase plan after the offer was substantially oversubscribed.
The machine learning company, whose shares have risen 76 per cent this calendar year, says the share purchase plan was approximately 3.4 times oversubscribed and consequently each eligible applicant will receive about 29 per cent of the new stock for which they applied.
The new shares will be issued on Wednesday at $21.50 per new share, compared to Appen’s $22.56 per share valuation prior to the start of trade on Tuesday.
AAP
7.55am: Copper rises
Copper prices rose overnight on news of fresh stimulus measures in top metals consumer China and hopes for a US-China trade deal.
Other industrial metals, such as zinc, were dampened by the prospect of rising supply and producer selling.
The Chinese government said it would relax residency curbs in many of its smaller cities and increase infrastructure spending to boost economic growth.
On Sunday, China also announced measures to encourage financing for small and medium-sized businesses.
Capital Economics in London. Benchmark copper on the London Metal Exchange gained 1.2 per cent in closing open outcry trading to trade at $US6,475 a tonne, snapping two days of decline. Some other metals prices endedin the red.
Three-month LME zinc shed 0.6 per cent to finish at $US2,906 a tonne, partly due to producers seeking to lock in high prices through hedging programmes, said Alastair Munro at broker Marex Spectron.
Reuters
7.50am: Oil gains up to 2pc
Oil prices rose up to 2 per cent overnight, hitting five-month highs, on expectations that global supplies would tighten due to fighting in Libya, OPEC-led cuts and US sanctions against Iranand Venezuela.
International benchmark Brent futures rose 76 US cents, or 1.1 per cent, to settle at $US71.10 a barrel.
US West Texas Intermediate (WTI) crude futures gained $US1.32, or 2.1 per cent, to settle at $US64.40 a barrel.
Brent’s session high of $US71.19 a barrel and WTI’s of $US64.44 were the highest since November.
Reuters
7.10am: ASX set to open slightly higher
Australian shares are expected to open marginally higher after a mixed lead from Wall Street overnight.
At 7am (AEST) the SPI200 futures contract was up 10 points, or 0.16 per cent, at 6,220.0, suggesting a small rise for the benchmark S&P/ASX200.
On Wall Street, the Dow Jones Industrial Average was down 0.32 per cent, the S&P 500 was up 0.10 per cent and the tech-heavy Nasdaq Composite was up 0.19 per cent.
The Aussie dollar is buying US71.27 cents from US70.99 cents yesterday.
AAP
7.00am: Remittances hit record
Money transfers to poor and developing countries hit a fresh record in 2018 and should become their largest source of external financing this year, the World Bank said.
But many banks and money transfer operators charged too much, cutting into the gains of migration, the bank said in a statement.
Migrant workers and others sent home an estimated $US529 billion to low- and middle-income countries last year, up 9.6 per cent from the year before, which had also been a record.
Such money transfers should hit $US550 billion this year, making them the largest source of external finance, according to the bank.
AFP
6.45am: US stocks end mixed
Wall Street stocks finished mixed in a cautious start to week that includes major economic data and the start of first-quarter earnings season.
The Dow Jones Industrial Average ended down 0.3 per cent at 26,341.02. The broadbased S&P 500 edged up 0.1 per cent to 2,895.77,while the tech-rich Nasdaq Composite Index gained 0.2 per cent to 7,953.88.
Australian stocks are set to open slightly higher. At 6.40am (AEST) the SPI futures index was up eight points.
Key US economic releases this week include consumer prices for March, while investors are looking ahead to earnings from JPMorganChase that will kick off the first-quarter reporting season.
Expectations for earnings are low, a dynamic that some analysts think could boost stocks if companies outperform. CFRA Research projects companies in the S&P 500 will report a 2.7 per cent fall in operating earnings-per-share.
“We have a low bar for earnings,” said JJ Kinahan, chief market strategist of TD Ameritrade.
“It is widely accepted that earnings will be soft for the first quarter, but investors are betting that the forward-looking statements will be good.”
Other key events this week include a Brexit summit of European Union leaders on Wednesday and a policy announcement by the European Central Bank on the same day.
Boeing sank 4.5 per cent as investors weighed the company’s announcement late Friday that it was cutting production of its737 planes due to the global grounding of the 737 MAX, with Citigroup downgrading the company and Morningstar estimating the crisis would shave $1.11 per share off of 2019 profits.
General Electric tumbled 5.2 per cent following a bearish note from JPMorgan Chase, which downgraded the company, citing poor conditions in key businesses such as power and aviation fundamentals that are “weaker than meets the eye.” But digital security company Symantec jumped 5.4 per cent following an upgrade from Goldman Sachs.
AFP
6.40am: Boeing shares slump
Boeing shares slumped on the company’s weakened profit outlook after it announced last week it will cut production of 737 planes following two deadly crashes.
Shares were down 4.5 per cent at $US374.02 in afternoon trading, weighing on the Dow in the first session since Boeing announced late Friday it would trim production to 42 planes per month, down from 52 per month.
Several analysts downgraded profit estimates, releasing notes that expressed a variety of views on the seriousness of the crisis for Boeing.
The 737 MAX has been grounded globally following two crashes in five months on Lion Air and Ethiopian Airlines that killed nearly 350 people.
AFP
6.35am: European stocks fade
European stock markets gave up early gains to close mostly lower, dragged down by US markets worried about trade talks and the upcoming earnings season, analysts said.
The British pound was volatile as investors weighed the risks of another Brexit-themed week, with many willing to bet money on another, perhaps long extension to proceedings, while others think a hard crash out of the EU is not off the table.
In stock trading, Frankfurt came under pressure from the get-go after poor German data, and other eurozone equity markets soon followed suit, feeling the pressure from negative sentiment across the Atlantic.
London, however, managed to eke out a small closing gain as the pound pulled back from the day’s highs.
German data showing falling imports and exports in February spoiled the mood in the eurozone and added to concerns about the health of the eurozone’s biggest, and heavily trade-dependent, economy.
German imports fell 1.6 per cent month-on-month to 92.3 billion euros ($US103.6 billion) while exports dropped 1.3 per cent to $US110.9 billion, federal statistics authority Destatis said.
IG analyst Joshua Mahony called the date “sagging” and said that “with both exports and imports falling for the European powerhouse, a worsening picture becomes apparent for the eurozone flagship economy”.
Asian indices traded mixed but investors remain broadly upbeat after a strong US jobs report that eased concerns about the world’s top economy.
AFP
6.30am: Rio to invest in Richards Bay
Rio Tinto says it will go ahead with a $US463 million investment in its majority-owned South African business Richards Bay Minerals.
The company, which owns 74 per cent of Richards Bay Minerals, said the investment will help prolong operations as ore grade declines at the projects owned by the business. The funds will be used to open a new mine that will help sustain the supply of zircon and ilmenite.
Rio Tinto said it will not take on any additional debt to fund the investment, which will be the financed using Richards Bay Minerals’ cash flow.
Dow Jones Newswires
6.25am: Jury discharged in Barclays case
The jury in the trial of four former Barclays executives accused of fraud during the 2008 financial crisis has been discharged, Britain’s Press Association newswire reported.
Ex-CEO John Varley and former executives Roger Jenkins, Thomas Kalaris and Richard Boath, had been charged with conspiracy to commit fraud in connection with an emergency fundraising from Qatar during the financial crisis. All four men had pleaded not guilty.
The trial at London’s Southwark Crown Court began on January 23 and had been expected to last about four months.
AFP
6.20am: Pinterest readies for IPO
Pinterest, among a gaggle of tech companies planning to go public this year, hopes to raise as much as $US1.5 billion in its initial offering of shares.
The digital scrapbooking site said in a regulatory filing that it will put about 75 million shares up for sale at a price between $US15 and $US17 each.
That, at the higher end, could put the value of the company at around $US9 billion, below the estimated $US12 billion value from earlier sales of shares to investors, according to reports two years ago.
AP
ASX hitting record highs; RBA to cut in Feb: NAB
Sharemarket sets new highs after US gains. NAB revises rate cut prediction. HUB24 logs record first quarter inflows. CBA says households cutting back spending. Tyro sinks on RBA review of card payments and surcharging.
Miners lead as ASX rises; Web Travel sinks 36pc on weak update
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