Morning all,

Another benign night overseas with mixed reactions to Chinese Industrial production data and US jobs numbers ,so once again we are left to our own devices..No bad thing.

Yesterday a high profile commentator, who I shall not name ,was plastered all over the Sydney Morning Herald with his view that we have finished the bear market and are on the cusp of a new Bull market. Well, I hope he is right although I suspect his optimism is slightly premature and I need to see some more evidence of a pick up globally to join in the chorus of ‘here we go, here we go!’I still feel that ‘Zombieland’ has the capacity to surprise with its ineptitude and that’s there is downside risk.I also think that the Olympic effect of feel good national pride is weighing heavily on the market at the moment and investors are happy to ignore the problems out there….September is shaping up as an interesting month with Dutch Elections, Germans voting on ECB moves and Greek end of term reports…I read this gem on http://www.zerohedge this morning which says it all about the issues with Greece…

‘Nepotism is not just alive but it is blatant and thriving in Greek politics. As Athens News reports revelations that Vyron Polydoras, who held the position of speaker for just a single-day during the hung parliament of May 2012, rushed to hire his daughter – Margarita – as an employee of his office. Not only did he hire her on his one and only day in office, despite defending himself by stating he was entitled to hire up to six staff, but he also managed (all in this one day remember) to approve a two million euro ‘election bonus’ for his staff and police.’

So on to our market ,the big move yesterday was out of safe into risk..seling of TLS and Banks and other defensives and into BHP,RIO and WPL.I applaud the sentiment to some extent but am still a major fan of yield despite the siren like attraction of the ‘buy now, how can it get any worse’ story…company results are mixed at best and the good are rewarded like CPU whilst the bad or underwhelming are punished..TLS is one example where the market got a little ahead of itself with its forecasts and disappointment was always a factor..However I would be a buyer at these levels for the dividend alone…42 c in 13 months..11% fully franked..still appealing.Interestingly he is deploying cash on long term growth strategies rather than the short term return to shareholders…we will see if he is right in time.

 

One of my other favourites BRU is hosting a big trip next week for analysts and brokers.. wasn’t invited mores the pity but its shaping up to be very popular ,expect more good news to continue in this one..nibble away people nibble away …could be the next WPL in years to come..

 

 

Things to make me go all Usain Bolt!!

1.Man is a legend now, ..its official…and well down the Rowers another Gold medal and that 16 year old diver..amazing.

2.Manchester United prices 16.7m shares at $14 each which is below the range they had thought…..no silverware in this IPO I am afraid..but maybe leaves some upside rather than the faceplant float!!Thats an oxymoron I suspect!!

3.In US economic headlines, initial jobless claims, an indicator of cuts to the labour force, fell 6,000 last week to a seasonally adjusted 361,000. Economists had forecast a rise to 370,000. Claims from the prior week were revised slightly higher.

4.Volumes continue to be terrible with US volumes collapsing with them18% below 3 month average, and leaving it to computers to trade with themselves.However lack of liquidity will make shorts nervous!!!

5.US runner breaks his leg in the relay but still manges to finish..that is what the Olympics is about people..terrific story and they won too!!

6.BHP: PetroHawk Energy, which was acquired by BHP for $US15bn last year, has reported a June-half loss of $US101.7m due to the collapse in US gas prices.

7.FXJ: The board of Fairfax Media will meet today to discuss a $1bn-plus writedown, expected to be announced at the company’s annual results on August 23

8.World’s oldest shipping company closes as The Baltic Dry Index, a gauge of rates to transport dry- bulk commodities including grains and coal by sea, is down 55 percent this year and on course for a fourth annual slide in five years, data compiled by Bloomberg show. The current slump is “one of the worst experienced for many years,” the shipping company said in the statement….this is a sign of global slowdown…

And finally…A man goes to a psychiatrist and says, “Doc, my brother’s crazy, he thinks he’s a chicken.” The doctor says, “Why don’t you turn him in?” The guy says, “We would. But we need the eggs.”

Have a good weekend

Clarence

XXX

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