Morning all,

The market has been stuck in the 4000-4400 range for some time and it looks like we are going to push towards the top end of that range…equities are rallying everywhere as hopes that Central banks will intervene gather momentum..Dow is now close to 13,200..seems incredible but there you go..election years are always good for the US market. News out of ‘Zombieland’ remains slightly positive with hopes the ECB will start flexing their muscles and buy Spanish and Italian bonds..

Yesterday the RBA left rates on hold as expected and gives them some space to move if things get worse around the globe…hope to see a modest move before Xmas but suspect they will be happy to do nothing unless the proverbial hits the fan!

Diggers and Dealers conference in Kalgoorlie at the moment so expect some action in the small end of town as the red wine helps grease the wheels of bullishness!

We will probably see better performance in Resource space as market gathers confidence and we may see the signs of switching from safe and defensive to BHP.RIO ,WPL and NCM in leader land…

I suspect that when everyone joins the party it will be time to sell…4350 is my target with maybe 4400 on a good push but that will hold it..

Score card on Results.

Bradken-Good stock up 10% Research report attached..

TCL- mixed down slightly

COH –suffered from recalls but no disaster down slightly

LEI-Worse is past perhaps..least that is what the company is saying..prefer to wait..

Today we have CPU reporting net profit for the year to June 30 was $156.5 million, down 40.7 per cent from $264 million in the previous corresponding period. Sees no sign of better times ahead (Stock did get hammered yesterday so we will see how it goes today..up 3% not that bad then!!)..Stockland (SGP) joined the naughty corner with profits down 35% and said things were challenging..expect to hear that a lot in the coming weeks..

Things to make me go all Keirin! And Pearson! And Anna!And Tom!!

1. Anglo-Swiss miner Xstrata has been the first of the big global miners to formally confirm what the market has long suspected: earnings are being smashed by the broad retreat in commodity prices, forcing capital expenditure to be slashed.
2. Takeover target Whitehaven Coal has restructured its management team in a bid to drive future growth as billionaire Big Nath finalises a $5.3bn plan to privatise the coal producer.Still think he can pull it off!Upside potential to 5.20!!
3. Turns out Australia did not boycott the Olympics after all but just missed their flight and last night delivered..well done Sally and Anna..Congrats to Sir Chris Hoy as well with his sixth Gold for Team GB..awesome.
4. Seven Cameroon Olympians decide to jump ship and try their economic luck in Europe..Good luck with that ..may be better off where they were!!Possibly haven’t been reading the news!
5. Massive fall from one of the UK’s banking stars as Standard Chartered fell 16% overnight after a 6% fall the previous night..US going after them for doing business with Iran…this is gonna be a big story as is LIEBOR but the fine for Standard could be huge…
6. Greek outlook has worsened according to S&P with it cut to negative..GDP to shrink by 11% in 2012 and 2013…they are gone! Leaders pledge no more unemployed Public servants…
7. According to some analysts and industry sources ,Coal used to make steel is set to drop to the lowest price in two years, eroding earnings at BHP Billiton Ltd. (BHP) and Rio Tinto Group (RIO), as European demand wanes and China shifts supply contracts to Mongolia from Australia.
8. Base metals higher ,Oil at two month high and Gold slightly easier..expect to see more corporate activity in the Resource sector as it gets cheaper to buy assets in the ground than explore for them..SLR taking out IGR is just the start..
9. VIX back to 16…below the long term average…maybe time to be cautious on US and us to catch up!

In the spotlight today

• CPU FY12 Results –See      above
• RIO Interim 2012 Results
• SGP FY12 Results –See      above
• Diggers and Dealers day      3: FMG, WSA, BCI, AGO, NCM , AQG presenting

And finally Police arrested two kids yesterday, one was drinking battery acid, the other was eating fireworks. They charged one – and let the other one off.

Clarence

XXX

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