CBA - Commonwealth Bank of Australia

[Nick Radge]

a breakout to the downside that sticks will see $30.00 with a high degree of probability

Today's low was $29.92 with a reasonable close at $31.22. There could be something in that. We'll be taking another look later this week to see what the Elliott Wave pattern suggests from here.


This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

 

[Sean K]

Big turn around on the financials this morning, all bouncing sharply.

Interesting.

Wonder if it'll hold?

 

[TheAbyss]

Well i have taken a risk and jumped in at $29.95 for a while and see if we can get a bounce. The 5 year chart indicates a bit of a floor around $30 and Nick has a technical evaluation of same. Concerned that technicals get forgotten in times of fear but worth a shot in my view.

Charty attached but no lines etc as i dont have the analytical skills required but $30 does look ok (as did $40 a short while ago).

 

[Nick Radge]

The EW count suggests we're clearly impulsing lower in what may be an extended 5-wave pattern (labeled -1 through -5) that now appears to be sub-dividing into a smaller pattern (labeled -i through -v). The correct way to trade this pattern is with the trend, so looking for the end of a wave-iv bounce and initiating shorts with the trend - as opposed to against it. You can see that there is no sign of a wave-iv or the end of wave-iii for that matter.




This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

 

[agro]

it fell below $30 today

do you think CBA and other banks will maintain their dividends for next year?

 

[oldblue]

it fell below $30 today

do you think CBA and other banks will maintain their dividends for next year?

Far too early to call that, IMO.
Apart from CBA, the other three "pillars" are barely into their new financial year with a long way to go before the half, let alone the final results.

 

[alphaman]

do you think CBA and other banks will maintain their dividends for next year?

So far SUN seems to be the only bank that has admitted dividends will be cut. ANZ and WBC have specifically insisted that dividends will be maintained, just like the government and RBA saying we will not have a recession.

Realistically, it's such a no brainer that dividends will have to be cut.

 

[sammy84]

SUN's balance sheet is in a lot more trouble than the banks. I think the big banks realise that so many holders haven't sold yet on the provision of receiving dividends, so any cut would have a drastic impact on the SP. They have the capital available to keep dividends the same, so why not...

 

[ROE]

either the market is wrong or the bank is telling lies
with the current SP the market factor in some dividend cut

consider we only see a few corporate collapse and their provision start to look scary, imagine when the housing market turns and fore closure are coming in thick and fast, that is the scary scenario

because all the big 4 has pretty big residential and construction loan book
probably their biggest loan book.

and I think a lot of people are imagining that scenario and hence the SP

 

[Sean K]

it fell below $30 today

do you think CBA and other banks will maintain their dividends for next year?

All 4 bank CEOs have categorically stated they will not cut dividends.

Michael Pascoe wrote a piece about it in whatever paper he writes for a couple of days ago.

Lets wait to see some pants on fire.

 

[drsmith]

I remember Westpac's pants being on fire back in 92 when as part of a capital raising the promised dividend was halved.

Hopefully none of the major banks will find themselves in as much distress as Westpac did back then.

 

[Sean K]

Found the Pascoe article in the Brisbane Times.

Banks offer treat or trick
Michael Pascoe | November 19, 2008 - 7:33AM

Either the market is offering some of the great buys of the decade or we've witnessed a complete collapse of trust in the chief executives of our cornerstone institutions.

Westpac touched a low yesterday of $15.30. At that price, Gail Kelly is promising to pay you an amazing pre-tax dividend of 13.25%.

ANZ fell as low as $12.65. At that price, Mike Smith is promising to pay an absolutely extraordinary pre-tax dividend of 15.35%.



Hmmm, Ralph Norris from CBA isn't quoted in it...

 

[johenmo]

I'll go for a collapse in trust. They still have hiddens bags of dirty laundry yet to come out, I reckon.

Divs will be lower, unless Rudd Pty Ltd gives them some more spending money. If he does, I hope it's NAB and goes straight their most deservind shareholder - me!

 

[mfsperth]

CBA and Citigroup's assessment

With 52,000 job losses, stock market value down from $274 bn to $26bn, and $20 bn in losses in one year, Citigroup are in no position to bag CBA.

Citigroup seem to be on a continuing campaign to drive down value in Oz stocks, and their public assessments need to be subject to the same controls as ratings agencies are about to come under.

 

[cuttlefish]

Interesting close today. Traded in $31.50 to $32 range most of the day then in the match up it jumped $2 to close at $34.00.

I'm assuming looming options expiry is a likely part of the explanation given its been a strong down month. Also noted that BBP managed to pay off a debt facility announcement at 4:15 p.m (don't follow BBI so not sure if this was expected). Also no news today from CNP which might be a case of no news is good news?

Any other possible explanations for the large jump on the close?

 

[cuttlefish]

Well an interesting item on the SMH this afternoon about a big computer glitch at CBA causing duplicate transactions to occcur for about 200,000 customers. Does anyone know when this news actually came out ... and WTF did they not put out any ASX announcement about it.

Its a bit scary that they can make such a large error ... kind of brings home the fact that our 'dollars in the bank' are really just a bunch of magnetic imprints on a computer disc somewhere.

 

[sinner]

Yeah lol I got a few emails today from some rather disconcerted online sellers who were wondering why the cash I had sent them over the weekend was vanishing from their accounts.

http://www.commbank.com.au/news/netbank_news14.aspx?n=news39

This is CBAs second "computer glitch" in a very short period of time. A sign of so called cracks in the wall?

EDIT: The original update I saw was at 11am, there could have been one before but I had an exam this morning.

 

[honey85]

Does anyone know why the price of CBA is so stagnant lately? The market surged 80+ points today but CBA had negligible change. It has been almost a week and CBA is trading around $28. Was it because of the announcement on 10th dec to raise capital of $750m? And what do you guys think of CBA in the short-term and long-term future? I am quite new to shares.

 

[cuttlefish]

This are my views - for what they're worth - don't hold me to them!

Factors affecting CBA and banks lately:

Fundamental
* WBC cap raising and CBA announcing small cap raising as well has dragged down both of them in my view.
* As I understand it CBA has a fair bit of exposure to Centro Propertie who are due to make an announcement about their debt deadline sometime in the next day or two (see below - they went into trading halt pending announcement today).
* General economic environment - retail sales, unemployment/jobs, housing etc.

Technical
* Broke down from a long term sideways trading band between $39 and $45 around the beginning of November to resume its downtrend
* Seems to have some historical support around $28 which its bounced off a couple of times in the past few few weeks - I see more firm historical support around $23 as well. There is also a historical congestion area in the $23 to $32 sort of range so it might find support in this zone (or get bogged down in this zone for a while before turning back upwards). If it falls down below this zone it will be interesting.

My personal view on banks is still bearish and I think CBA had gotten off lightly so far this year compared to the others and has been doing a bit of catchup lately.

CNP announcement from today below:

Centro Properties Group (ASX:CNP) Request for Trading Halt
Centro Properties Group (Centro) hereby requests that the ASX grant a trading halt of its
stapled securities effective immediately, until the making of a pending announcement regarding
the outcome of negotiations on the extension of its finance facilities that are due to expire today.
Centro requests the trading halt remain in place until the sooner of the making of that
announcement and the opening of trade on Wednesday 17 December 2008.
Centro confirms that it is not aware of any reason why the trading halt should not be granted.

 

[sinner]

honey85, as mentioned in this thread and others, the big white elephant in the room is Centro.

These debts were supposed to be called today I believe.

http://www.skynews.com.au/business/article.aspx?id=286956

Of course they cannot pay this and CBA has exposure, the market knows it.

http://www.bloomberg.com/apps/news?pid=20601081&sid=aLWN7N6s_HJI&refer=australia

US malls have been reported as drying up all over the country. I can probably dig up a link if you like.

Nobody is interested in going long until the smoke clears.

Just dug this up on Google News

http://www.theaustralian.news.com.au/business/story/0,28124,24791824-5001641,00.html

Good read "Centro Properties in sights of CBA's hitman" small tidbit

But Centro Properties is no place for the short-sighted. Its collapse would be an economy-shaking event. For 10 months now, the ludicrously constructed, trans-Pacific shopping mall owner has effectively been in the hands of two syndicates of banks and 10 insurance companies which are owed over $6 billion. The CBA is owed $1.2 billion by Centro. Of that, $1 billion is secured -- making the bank Centro's biggest secured creditor.


Of the other pillars, the NAB has the next biggest secured exposures at $750 million with a further $200 million unsecured, while the ANZ has $700 million of secured debt and $680 million unsecured and Westpac $558 million secured, most of that courtesy St George Bank.

Centro needs to get 23 separate financial institutions to sign off on that plan. As of last night, it had the endorsement of 22. The hold-out? It is Griffiths and the Commonwealth.

EDIT: Bah ya beat me to it cuttlefish! While I was digging for links!