Overseas Market Report – U.S. Stocks Gain Ground
U.S. stocks posted strong gains on the last day of the third quarter, driven by gains in the consumer discretionary, materials and health-care sectors, but stocks were set to finish the quarter with overall losses.Companies in the U.S. private sector added 200,000 jobs in September, according to a report from payroll processing firm ADP. This strong data, led by new job growth in the construction industry, suggests that U.S. employment is steady.
The Chicago PMI fell to 48.7 in September from 54.4 in August, according to data released by MNI Indicators. Readings below 50 indicate contraction.
At the close, the Dow was up 1.5%, the S&P 500 had gained 1.9% and the NASDAQ had risen 2.3%.
For Australian ADRs listed on the NYSE, BHP Billiton added 89 cents (2.90%) to $31.62, ResMed gained 34 cents (0.67%) to $50.96, Telstra Corporation lifted 49 cents (2.56%) to $19.65, Spark New Zealand rose 19 cents (2.01%) to $9.52 and Westpac increased 42 cents (2.03%) to $21.06.
At 7:45 AM (AEST), the 10-year Treasury note yield was 2.04% and the 5-year yield was 1.36%.
Shares of hard-drive manufacturer Western Digital Corp (WDC) rose after announcing that China's Unisplendour Corporation (Unis) will make a $3.8-billion equity investment in Western Digital.
Ralph Lauren Corp (RL) said that it hired Stefan Larsson, who was most recently global president of Old Navy, a division of Gap (GPS), as its new chief executive officer.
European markets were higher.
The FTSE 100 and the French CAC 40 were both up around 2.6% and Germany's DAX gained 2.2%.
Asian shares were also higher.
The Shanghai Composite gained 0.5%, the Nikkei 225 was up 2.7% and the Hang Seng was up 1.4%. India's Sensex was 1.5% higher.
Australian Market Report – Local Market Expected To Open Flat
Ahead of the local open, SPI futures were 1 point higher at 5,008.
Wednesday 30 September – close. The Australian market bounced back from Tuesday's plunge to close above the 5,000-point level. Mining giants BHP and RIO managed to overcome yesterday's losses, lifting 2.8 per cent and 4.5 per cent respectively, while the big banks joined the rally with CBA up 3.7 per cent. All sectors performed positively, with the exception of utilities. The Australian dollar fell against the greenback and had mixed results against other major currencies.
The All Ordinaries added 100.50 points to 5,058.60 while the S&P/ASX 200 rose 103.20 points to 5,021.60.
Growthpoint Properties Australia (GOZ)
Growthpoint Properties Australia announced that the Company has signed contracts to acquire a 14.1ha industrial property in Wollongong for $20.3m. The property is 100% leased to a subsidiary of Asciano for 15 years. The acquisition will be funded from debt taking the Company's total gearing to 39.7% and its debt headroom to $145.3m. The property has been independently valued by JLL at the purchase price. Settlement is due to occur on 14 October 2015 with the acquisition expected to be immediately earnings accretive. The Company receives an initial passing yield of 7.0% and the lease has fixed increases of 4.0% pa. The tenant pays all outgoings and is responsible for maintenance of the property. The tenant is Patrick Autocare, a logistics provider to the automotive industry. GOZ lifted 4 cents to $3.12.
Rio Tinto (RIO)
Rio Tinto announced that it has reached a binding agreement for the sale of its 40% interest in the Bengalla coal JV in Australia to New Hope Corporation for US$606m. Bengalla is the smallest of 3 coal mines in the Hunter Valley of NSW in which the Company holds an interest, producing 8.6mt. It has completed US$4.5bn of divestments since January 2013, with the agreed sale of its interest in the Bengalla JV. The Company and Mitsubishi Development have recently agreed a simplification to the ownership structure of Coal & Allied which helps enable this transaction. Under the agreement, the Company will assume 100% ownership of Coal & Allied. The sale of the interest in the Bengalla JV is expected to close in the first quarter of 2016. RIO gained 208 cents to $48.60.
Recent Contacts & Presentations
Orbital (OEC), Intueri Education (IQE), OBJ Limited (OBJ), TFS Corporation (TFC), HRL Holdings (HRL), Tox Free Solutions (TOX), Sino Gas & Energy (SEH), Dacian (DCN), Carnarvon Petroleum (CVN), Otto Energy (OEL), Empire Oil & Gas (EGO), FAR Limited (FAR), Central Petroleum (CTP)