Good morning,

The news out of China yesterday was better than expected..despite the pessimists calling for the hard landing, the GDP number of 8.9% growth was better than the economists were going for…8.9% growth still not too shabby especially as its growth on growth on growth..it does have to slow down otherwise it would be just ridiculous but optimists took heart..Our Market pushed up on thin volume again(1.6bn) and news from BHP,RIO and FMG in the Iron Ore space was all good..the Pilbara is churning out ore faster than you can say Twiggy Forrest!

The SPI was a little easier last night but after a slow start confidence will pick up…again it will be thin and quiet but expect positiveness to creep in…commodities were good and that will help the miners which will outperform financials..news of the CBA bond auction overnight shows how much the banks are under pressure on fund raisings..this will make it hard for them to cut rates…they had to pay 175bps over swap rate which is a bit ritzy..

So expect our market to push up a little and still think 4300 is possible in a week or so..

TLS had a good day yesterday and may continue to push towards 3.40 as dividend talk and capital management issues swirl..easy money has been made..buy below 3.30 ..at 3.40 they are a hold and at 3.45-3.50 sell!

Iron Ore stocks will do ok and would be a buyer of BHP,RIO and FMG on any weakness for a move higher in coming days..FMG research enclosed

I have also put together a high income portfolio for clients if you are interested ..I will send it on request.

Resources to outperform financials is the call in the next few days..Gold also looking positive ..favoured stock in Gold sector is SLR still.

Enjoy the day

Any financial product advice contained in this email is general financial product advice only and does not take into account any one person’s objectives, financial situation or needs. Therefore, before acting on any financial product advice in this email, you should consider, with or without the assistance of an independent adviser, the appropriateness of the advice, having regard to your objectives, financial situation and needs.