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Kalkine Daily 07/07/2015 + Should you buy Westpac Bank ?

Jul 15, 2015

In today’s daily we have covered stock research on One Infrastructure Stock To BUY2 Small Cap Gold Stocks To Buy and Should you buy Westpac Bank ?










 

The S&P 500 index was down by 8.02 or 0.39% points to 2068.76. U.S. stocks fell in a volatile session on Monday as Greeks resoundingly backed the government in rejecting the austerity terms of a bailout and as China implemented emergency measures to stop a selloff in Shanghai's market. US government debt prices rallied higher on Monday as investors shifted into the safe-haven asset and out of ItalianSpanish and Portuguese bonds after Greek voters voted down a referendum to agree to creditor demands. Yields on the benchmark US 10-year note, which move inversely to its price, slid 10 basis points to 2.29 per cent in afternoon trading in New York. 

The price of internationally traded Brent crude oil dropped 4.5 per cent to $57.58 a barrel in afternoon trading on Monday, recording its biggest one day fall since April 8. The turmoil in Greece has helped put downward pressure on the oil price while unprecedented measures in China to stem stock market losses has also been eyed by investors who are moving away from riskier assets. PayPal has an official market value as a standalone company, ahead of its separation fromeBay later this month: $44bn.




EBAY Daily Chart (Source - Thomson Reuters)
 

S&P ASX 200 was down by 63.30 points or 1.14% on Monday and closed at 5475.00 points. Rio Tinto fell 2.5 per cent to $51.16, BHP Billiton lost 2.2 per cent to $26.01 while Fortescue Metals Group shed 5.8 per cent, taking its share price to a six-year low of $1.71. While oil plunged, gold prices enjoyed some safe-haven buying, and spot gold prices rose 0.3 per cent. The day's share winners were gold miners Evolution Mining, up 7.4 per cent, and Northern Star Resources, up 3.3 per cent.

The banks were all down, with Commonwealth Bank down 0.4 per cent, Westpac and ANZ Banking Group down 0.8 per cent and National Australia Bank down 0.7 per cent. Telstra fell slightly down 0.2 per cent, Woolworths was down 1.8 per cent and Wesfarmers lost 0.9 per cent. The Australian dollar is trading at US74.88¢, compared with Monday's local close of US75.11¢.Ore with 62 per cent iron content delivered to Qingdao retreated 5.4 per cent to $US52.28 a dry metric ton on Monday.



Telstra Daily Chart (Source - Thomson Reuters)

 


 

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Should you buy Westpac Bank ?

Westpac Bank (WBC)

Westpac reported its 2015 interim financial results and the operating divisions, especially retail and business banking, delivered though with a lower bottomline.. Cash earnings were affected by adjustments for derivatives and lower earnings from Treasury operations. Strength continues to be a feature of the group and the economic outlook is positive even though there are some near-term challenges. The focus continues to be strategy with an increased emphasis on service.
 
Cash earnings at $ 3.778 billion was down by 2% compared to the second half of 2014 while cash EPS was down by the same percentage to 121.3 cents per share. The reported NPAT was down 8% to $ 3.609 billion and NIPM excluding Treasury and Markets was flat at 2.01%. The impairment charge to average gross loans was flat at 11 basis points and return on equity was down 54 basis points to 15.8%. The common equity tier 1 capital ratio was down 21 basis points to 8.8% and the fully franked interim dividend was 1% higher at $ .93 per share. Cash earnings growth from the operating divisions was 1.4% and core earnings growth was 2.2% while total group cash earnings came to $ 3.778 billion after negative derivative adjustments of $ 85 million. Click Here To Read The Full Report


Capital Ratio (Source - company Reports)
 




Two Small Cap Gold Stocks To BUY

Beadell Resources (BDR)

Beadell Resources Ltd (ASX: BDR) has recently reaffirmed its confidence of achieving a full year production guidance in the range of 170 000 oz and 190 000 oz. However, since its openpit operations witnessed a lower-than-expected material movement during April and May, the firm has recently adjusted its June quarter production figures accordingly. The Tucano mine’s operations in Brazil got affected by the rainfall, which in turn obstructed material movement by turning the Urucum openpit from clay-rich colluvium and oxide overburden to harder ore. Consequently, the group has reduced the Gold sales estimates from the Tucano to be in the range of 25 000 oz and 28 000 oz for the June quarter, which is 33 000 oz lower as compared to the March quarter.

On the other hand, we believe that this negative impact has already been factored in the firm’s share prices and the group has been making solid efforts to boost its performance for the second half of the year. As and when the dry season starts, the group has planned a huge material movement on the site. As a result, the firm estimates a gold sales in the range of 115 000 oz - 125 000 oz during the second half of the year, at costs in the range of $810/oz and $890/oz. Click Here To Read The Full Report


Gold Nose and Mutum Location (Source: Company Reports)


 


One Infrastructure Stock To Buy

Macquarie Atlas Roads Limited (ASX: MQA) reported a decent increase in its weighted average toll revenue by 3.3% during the march quarter, against the same period last year, driven by higher traffic levels as well as revised toll schedules which has been executed from the last one year. The weighted average traffic for the period also rose by 2%, contributed by the improving traffic volumes at the APRR network.

Autoroutes Paris-Rhin-Rhône (APRR)

The traffic (total vehicles kilometers travelled) improved at APRR by 1.8% while the toll revenue rose 2.5% during the March quarter, as compared to the corresponding period in prior year. Heavy good vehicles traffic rose by 1.9%, driven by the recovering economy in France, while the light vehicles traffic surged 1.8% on the back of improved winter vacation traffic as well as less weather related hurdles. 


Traffic Growth (Source - Company Reports)


Level 13  167 Macquarie Street
Sydney NSW 2000 Australia
E-Mail - [email protected]
Phone - 02 8667 3147


        
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