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31 May 2017 (TheAge,SMH) – Cash holdings surge as asset managers quietly prepare for downturn

(31 May 2017, The Age, BusinessDay, p29, Myriam Robin) ‘Philip Parker from Altair Asset Management’s bold decision to liquidate his Australian shares funds and return the money to investors is highly contrarian. But his view that not all is well on the ASX is not. While none have so far followed his lead in publicly quitting … Continue reading

31 May 2017 (AFR) – Apartment approvals tumble – fall to two-year low in April

(31 May 2017, AFR, p34, by Michael Bleby) ‘The slowing of the country’s biggest housing construction boom continued in April, with the number of new apartment approvals falling to the lowest level in two years. Despite a monthly rise in approvals for new apartments, townhouses and semi-detached homes – which rose 8.9 per cent after dropping 17.7 … Continue reading

31 May 2017 (AFR) – US consumer debt pile drives big banks back from $US1.2tn car loan market

(31 May 2017, AFR, p23, by Ben McLannahan) ‘Big banks are throttling back from the $US1.2tn US car loan market, fearing ­consumers have taken on more debt than they can handle. Lenders piled into the sector in the years after the financial crisis, as low defaults and an improving economy encouraged them to double down … Continue reading

31 May 2017 (AFR,Lex) – Retailers of the world, Amazon will continue feasting on your business

(31 May 2017, AFR, p23, by The Lex Column) ‘Quake, shopkeepers of the world. Amazon will continue gorging on your business. Even as it conquers new worlds of computing and hardware, Jeff Bezos’s company still has ambitions in retail: one day the pharmacy business; the next, stores with no checkouts. Confronted with this juggernaut – … Continue reading

31 May 2017 (AFR) – Retailers kick off clearance sales as winter finally arrives

(31 May 2017, AFR, p13, by Sue Mitchell) ‘Retailers David Jones and Myer are slashing prices on autumn/winter apparel by as much as 50 per cent after pulling the trigger on mid-year clearance sales following the weakest retail trading in five years. David Jones’ clearance sale kicked off on Tuesday, just as the first cold … Continue reading

31 May 2017 (AFR) – Sydney, Melbourne house prices fall in May, CoreLogic says

(31 May 2017, AFR, p7, by Michael Bleby) ‘Australia’s two largest housing markets are cooling, with Sydney values down 1.3 per cent and Melbourne falling 1.8 per cent, CoreLogic figures show. The falls in the data provider’s home value index for the first 29 days of May likely reflected a continuing decline in apartment values, which lost ground in … Continue reading

30 May 2017 (AFR) – Lack of trust, not money, explains soft consumer spending in the US

(30 May 2017, AFR, p29, by Rana Foroohar) ‘There is a paradox at the heart of the US’s lacklustre economy these days. Consumers in America are, according to much-watched numbers like the University of Michigan consumer survey, more “confident” than they have been in years. And yet they are spending less than they have since … Continue reading

30 May 2017 (AFR) – Godfreys reveals profit downgrade and refinance by 98-year-old

(30 May 2017, AFR, p18, by Simon Evans) ‘Vacuum cleaner retailer Godfreys has downgraded its profit outlook after tough trading conditions and its 98-year-old major shareholder has provided a new $30 million loan at better terms than one which had been in place from the Commonwealth Bank of Australia. The company’s shares are now trading … Continue reading

30 May 2017 (TheAge) – Altair Asset Management hands back cash to clients citing looming correction

(30 May 2017, The Age, p10, Patrick Commins) ‘Australian asset manager Altair Asset Management has made the extraordinary decision to liquidate its Australian shares funds and return “hundreds of millions” of dollars back to its clients, citing an impending property market “calamity” and the “overvalued and dangerous time in this cycle”. “Giving up management and … Continue reading

30 May 2017 (TheAge) – No rose-coloured glasses: Treasury secretary John Fraser says this time things really are picking up

(30 May 2017, The Age, p5, Peter Martin) ‘Treasury secretary John Fraser has defended his budget forecast for economic growth, saying there are indications “the long period of growth undershooting forecasts is beginning to come to an end”. In the past three budgets the Treasury has forecast a lift in economic growth of 3 per … Continue reading

29 May 2017 (AFR) – Not a great start to the year – Investment signs point to slowdown

(29 May 2017, AFR, p30, by Philip Baker) ‘There’s a good chance the Australian sharemarket is telling us something about the economy. And it’s not good. Earlier this month, shares were threatening to break the key 6000 level, but since then have ricocheted back hard away from that number. It’s almost as if shares are … Continue reading

29 May 2017 (AFR) – Elliott’s Paul Singer warns ‘all hell will break loose’ if Trump agenda fails

(29 May 2017, AFR, p23, by John Kehoe) ‘Elliott Management, the New York hedge fund firm pressuring BHP for a major corporate shake-up, has warned that “all hell will break loose” in financial markets and that a US recession looms if President Donald Trump’s pro-growth agenda fails to be implemented. Elliott’s billionaire founder Paul Singer … Continue reading

29 May 2017 (TheAge) – Iron ore down 8.4pc in a week as volatility returns and speculators rethink demand outlook

(29 May 2017, The Age, BusinessDay, p20, Timothy Moore) ‘The spot price of iron ore has again dipped below $US60, with National Australia Bank warning that volatility risk has again risen in the market. Ore with 62 per cent content shed 3.9 per cent to $US57.91 a tonne on Friday ahead of a long weekend … Continue reading

27 May 2017 (AFR) – ASIC chase MFS directors for record $615m fines

[COMMENT: Here is an interesting case study for investors and traders to study to help minimise investeing risk going forward.] (27 May 2017, AFR, p5, by Patrick Durkin) ‘The corporate regulator says “all options are on the table” for chasing the former rich listers behind one of Australia’s largest financial collapses who have been ordered … Continue reading

27 May 2017 (AFR) – Economy hit by spending strike, cyclone

(27 May 2017, AFR, p1, by: Simon Evans, Carrie LaFrenz, Jacob Greber, Myriam Robin) ‘Australia’s economy looks to have experienced its weakest start to a year since 2011 – narrowly skirting a contraction – as a growing consumer spending strike and a cyclone-driven slowdown in exports weighs on activity just as the government bets its … Continue reading

27 May 2017 (AFR) – ASX: Energy stocks fuel ASX to narrow weekly gain

(27 May 2017, AFR, p33, by: Myriam Robin, Jessica Sier) ‘The sharemarket narrowed its weekly gain on Friday, with most sectors trading in the black over the five sessions. The benchmark S&P/ASX 200 shed 0.7 per cent to 5751.7 on Friday, taking its weekly gain to 0.4 per cent, while the broader All Ordinaries index … Continue reading

26 May 2017 (AFR) – Topshop adds to retail A-REIT woes

(26 May 2017, AFR, p34, by Larry Schlesinger) ‘The collapse of fast fashion retailer Topshop Australia has cast another dark cloud over the retail sector and the under pressure retail A-REITs. Westfield Corp, Vicinity Centres and Scentre Group are the worst performing A-REITS this year with negative total returns to date of 7.8 per cent, … Continue reading

26 May 2017 (AFR) – Mark Burgess says thirst for investment property is a red flag

(26 May 2017, AFR, p31, by James Frost) ‘Former Future Fund managing director Mark Burgess has said the golden years of investment returns are over and highlighted the growing possibility of a sharp downturn in the Australian housing market. Speaking at a Melbourne business breakfast on Thursday, Mr Burgess, the chairman of asset management firm … Continue reading

26 May 2017 (AFR) – Moody’s downgrade highlights China challenge

(26 May 2017, AFR, p29, by Tom Mitchell, Gabriel Wildau and Don Weinland) ‘Less than two weeks after China said it would open its domestic market to US rating agencies, Moody’s cut its credit rating for the first time in a quarter of a century. It cited financial and economic risks flagged in recent months … Continue reading

26 May 2017 (AFR) – Big car dealers AHG and AP Eagers downgrade profits

(26 May 2017, AFR, p27, by Simon Evans) ‘Australia’s two big listed car dealership firms have downgraded profit forecasts in the last 24 hours because of slowing new vehicle sales, in a troubling sign for the broader economy. Automotive Holdings Group warned on Thursday morning that softer trading in April on the previously strong eastern seaboard, a weak … Continue reading

26 May 2017 (AFR) – Growth fears as consumers cut spending – Belt tightening causes heartburn in retail and auto

(26 May 2017, AFR, p17,  by:  Simon Evans,  Sue Mitchell,  Julie-anne Sprague) ‘Worried Australian consumers are increasingly cutting back spending on discretionary items as they grapple with big home loans and uncertainty about holding onto their jobs, and the consequences are hitting a range of listed companies in the retail, automotive and industrial sectors. The … Continue reading

26 May 2017 (AFR) – China’s appetite for seafood is pushing global fish stocks to the brink

(26 May 2017, AFR, by Andrew Jacobs, New York Times) ‘Once upon a time, the seas teemed with mackerel, squid and sardines, and life was good. But now, on opposite sides of the globe, sun-creased fishermen lament as they reel in their nearly empty nets. “Your net would be so full of fish, you could … Continue reading

24 May 2017 (AFR) – Slump coming for housing construction in Sydney, Melbourne

(24 May 2017, AFR, p37, by Nick Lenaghan) ‘Housing construction in Sydney and Melbourne is headed for a major slump, hit by apartment oversupply and credit tightening, according to industry analysts Macromonitor. The downturn is already underway at a national level, with Macromonitor forecasting a total decline in dwelling starts of 23 per cent from … Continue reading

24 May 2017 (AFR) – March construction falls as residential work slumps at fastest pace in 16 years

(24 May 2017, AFR, p7, by Michael Bleby) ‘Developers put the brakes on new residential projects in the first three months of the year, causing housing construction to fall at its fastest pace in more than 16 years. The 4.7 per cent decline in residential building cut the quarterly total to a seasonally-adjusted $17.2 billion and was the greatest … Continue reading

24 May 2017 (AFR) – Ghost of ’97 stalks Hong Kong economy infected by housing debt

(24 May 2017, AFR, p34, by Alfred Liu, Moxy Ying and Enda Curran) ‘In 1997, the Asian financial crisis touched off a six-year property bust in Hong Kong that shaved more than two-thirds off prices and saddled the city with a stagnant economy and deflation. As Hong Kong gets ready to celebrate the 20th anniversary … Continue reading

24 May 2017 (TheAge) – SurfStitch faces $100m class action over share wipeout

(24 May 2017, The Age, BusinessDay, p22, Patrick Hatch) ‘Online fashion retailer SurfStitch is facing a $100 million class action launched on behalf of shareholders whose investments have been wiped out by the troubled company’s plunging share price. ‘ <snipped…> ‘SurfStitch listed at $1 in late 2014 and was trading at a record high of … Continue reading

23 May 2017 (AFR) – Pricing the services of our retailers – As Amazon looms, what would you ‘pay’ to shop with Australian retailers?

[COMMENT: Now this is an interesting view of how to put a price on the value that a bricks and mortar store brings to our shopping experience.] (23 May 2017, AFR, p32, by James Thomson) ‘How much would you “pay” to buy a product from Harvey Norman, JB Hi-Fi and Myer? That’s the question posed … Continue reading

23 May 2017 (AFR) – Big mortgages squeeze home buyers’ basic living costs

(23 May 2017, AFR, p5, by Sally Patten) ‘Borrowing six times a household’s salary to buy a property would make it difficult for many people to cover even basic living costs, says financial adviser Adele Martin of Firefly Wealth.’ <snipped…> ‘She was speaking after a report by investment fund JCP Investment Partners found that the … Continue reading

22 May 2017 (AFR) – Sydney, Melbourne property market fires back up as auction clearance rates surge

(22 May 2017, AFR, p6, by Larry Schlesinger) ‘Clearance rates surged in Sydney and Melbourne on the sixth biggest auction weekend of the year, suggesting talk of a downturn in the housing market may be premature. In Sydney where there were 1053 scheduled auctions, CoreLogic recorded a preliminary clearance rate of 80.7 per cent, up … Continue reading

22 May 2017 (AFR) – Interest-only loans could be ‘Australia’s sub-prime’

(22 May 2017, AFR, p1,  by:  Jonathan Shapiro, Jacob Greber) ‘High-risk mortgage loans to young families, professionals and other over-extended borrowers amounting to more than six times household incomes could wipe out 20 per cent of the major banks’ equity base, institutional investment fund JCP Investment Partners has warned. The fund manager’s study warns that official estimates of … Continue reading