Morning Market Update - 9 November 2017


Pre-Open Data


Key Data for the Week

Key economic data released this week:

  • Thursday – AUS – Home Loans
  • Thursday – US – Initial Jobless Claims
  • Friday – UK – Industrial Production
  • Friday – UK – Trade Balance

Australian Market


The ASX 200 ended the day up slightly, at 6,016 yesterday. Strength in Real Estate Investment Trusts offset losses in the Materials sector.

Commonwealth Bank of Australia (CBA) provided a 1Q18 trading update yesterday, reporting a 6% increase in cash NPAT, supported by volume growth and improved net interest margins. Its CET1 Ratio improved 55bps to 10.1%. CBA’s expense for Bad and Doubtful Debts fell to $198 million, or 0.11% of total loans, down from 0.15% in last financial year. CBA increased $2.07, to close 2.7% higher at $80.27.

BT Investment Management Ltd (BTT) also released its FY17 earnings yesterday, reporting an 8.9% increase in cash EPS to $0.55, largely due to a 12.7% increase in average FUM, to $90.4bn. However, performance fees declined 50.9%, to $37.9m. BTT declined $0.63, to close 5.8% lower at $10.30.

James Hardie Industries plc (JHX) has entered into a definitive agreement to acquire German-based XI (DL) Holdings GmbH from Xella International SA for cash consideration of US$549m, funded fully by debt. The acquisition provides the company with a growth platform for expanding its fibre cement business in the European Union. The transaction is expected to be completed by 4Q18 and be EPS accretive in its second year of ownership. JHX declined 1.5% to $18.95.

The Australian futures market points to a 0.20% rise today, being driven by positive leads from US markets overnight.

Overseas Market

US share markets rose, underpinned by a rally in the Technology sector. Financials shares were weaker, driven by concerns the US tax bill faces an uphill battle. The Dow Jones closed up 6 points and the S&P 500 edged up 4 points, with both indices closing at fresh highs.

In Europe, markets were mixed, with the UK’s FTSE 100 and German DAX ending the session 0.22% and 0.02% higher respectively, whilst France’s CAC 40 gave up 0.17%. The STOXX Europe 600 fell 0.20%. 

CNIS Perspective

Australia’s September quarter GDP is due to be released on 6 December, and while there is a significant headwind in the form of weak consumer spending, this should be offset by increased Government spending and growth in net export revenues.

The trade surplus released last week was the largest in four months and was the eleventh consecutive month of surplus. This reflects stronger commodity prices and export volumes, and corresponds with the pickup in momentum in the global economy over the past year.

Imports fell again for the third straight month, and reflects a combination of weaker domestic demand and lower import prices.

While GDP shouldn’t be significantly stronger due to the impact of weaker consumer spending, it should be far enough away from negative to allay any fears of a recession.


Contact Us

Should you wish to discuss this or any other Investment related matter, please contact our Investment Services Team on (02) 4928 8500.


The material contained in this publication is in the nature of general comment only, and neither purports, nor is intended to be advice on any particular matter.  Persons should not act or rely upon any information contained in or implied by this publication without seeking appropriate professional advice which relates specifically to his/her particular circumstances.  Cutcher & Neale Investment Services Pty Limited expressly disclaim all and any liability to any person, whether a client of Cutcher & Neale Investment Services Pty Limited or not, who acts or fails to act as a consequence of reliance upon the whole or any part of this publication. Cutcher & Neale Investment Services Pty Limited ABN 38 107 536 783 is a Corporate Authorised Representative of Cutcher & Neale Financial Services Pty Ltd ABN 22 160 682 879 AFSL 433814


Topics: Investment, CNIS, Market Update, GDP

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