Good morning,

The Canberra circus continues with Rudd landing back in Brisbane..there was one voter waiting for him(bless)..that and Wayne Swan in the car park with a mischievous look in his eyes and a revving car!!

I wouldn’t be surprised if Rudd decided not to run…it’s a bit like the old saying suppose you had a war and nobody came! I mean how silly would Julia look…this soap will run and run!!Even Rob Oakeshott has said that if the Government falls he would approach Malcolm Turnbull..the guy just cracks me up..how do these people get elected..

Anyway back to the markets…the ASX 200 will rally today to go 4/5 days up…good corporate results continue to come through and punish the bears with big leaps after the numbers…SPI up 14..market will push up around 20 again today touching that 4300 level..won’t make 4500 by March as I suggested some weeks ago..but would be nice if it pushed through 4350 to signal a buy signal and positive things ahead.

ILU reported yesterday and I enclose a report on them..these are a BUY…just try to time entry when the market looks weak…would suggest that a $20.00 target is possible..the piece is titled Dividends plus growth a delicious combo!!says it all.

Couple of things caught my eye this morning..

1.Dow rises in best January in 15 years as volumes drop to the lowest level since 1999-where are the retail investors…waiting… waiting!

2.US has 12 Straight quarters of profits beating expectations..earnings have increased 69% since 2009 whilst the Dow has rallied 22% in the past two years.

3.Yet another bid for LDW..was below $3.00 now an $11.00 bid..there’s some value there that the market doesn’t know about!..starting to look like an ebay auction!

4.Gold and Oil continue to push up..CME Gold margins were DECREASED two weeks ago..ah that’s why it has rallied..that and the World printing money faster than you can say EU default.

5.New man at Woodside said that he may look at buying back Shell’s stake in coming years as Pluto cash flow comes online..interesting option..

6.Bid Rumours for OST…from the Indians..price has gone ballistic in last few weeks as they are considering name change!!If that’s all it takes there’s a few other that might consider it too!

7.Julia Gillard is following me on twitter!!She must be desperate!

Some of the highlights from Corporate Australia yesterday

Origin Energy (ORG)

Origin Energy beat expectations with a bumper first-half profit generated by a fresh contribution from electricity assets acquired in New South Wales state, higher oil and gas prices, and an absence of any big asset impairments. The integrated energy company’s net profit for the six months to December 31 of $794m compared to a $136m loss a year earlier that was largely caused by a write-down of its Australian geothermal investments. Underlying profit jumped 61% to $489m, easily beating the $440.1m average of six analyst forecasts and helping push its shares up 2.3%. Origin became Australia’s biggest electricity retailer when it bought generating and retailing assets from the NSW government last year for $3.25bn amid claims from rivals that it may have overpaid for them. ORG rose 26 cents (1.89%) to $14.05.

Iluka Resources (ILU)

Iluka Resources posted a sharp jump in annual profit as it benefited from higher prices for its products, but said that while prices are likely to rise further near term its output of two key commodities would fall. The company didn’t offer any guidance for revenue in the current year, but said it was expecting costs to rise further, partly due to the lower production Net profit soared to $541.8m for the year from $36.1m in 2010 as mineral sands revenue climbed 76% to $1.54bn from $874.4m. The company declared a final dividend of 55 cents a share, compared with 8 cents a year earlier. ILU fell 57 cents (3.27%) to $16.86.

Insurance Australia Group (IAG)

Insurance Australia Group said that first-half net profit fell 11% as floods in Thailand and a severe Christmas Day storm in Melbourne boosted claim costs. However, the company upgraded its full-year revenue guidance after rate increases helped the top-line performance of its Australian and New Zealand businesses. IAG’s net profit for the six months ended December 31 fell to $144m from $161m a year earlier, as credit spread and equity market moves also hit the bottom line. IAG rose 24 cents (8.28%) to $3.14.

Have a great weekend…and remember “When I was young I thought that money was the most important thing in life; now that I am old I know that it is”. Oscar Wilde

Clarence

xxx

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