They say that if you get enough monkeys and enough typewriters you will get Hamlet…..To be or not to be that is the gurglepakshs6gbsgs…anyway nice to get a call right every now and then with my LNC call now up 23% since I wrote about them last week…was targetting 85 ish so at a high today of 93.5 its a great result…if you followed my call don’t forget to sell ..anyway enough chest beating here is the Orange Crop report for Xmas 2012!!

 Market Wrap

A quiet but firm start to the week which did have potential for more gains but the news from Japan of its economy slipping into a technical recession was enough to take the top off things. Once again large caps were in demand especially in the high yield banks and Telstra (A$4.37, +0.2%) and Rio Tinto (A$61.30, +1.9%) seem to have got a whole new lease of life following broker upgrades and the company’s initiative for cost cutting. CSL (A$53.53, -2.3%) continued to suffer from profit taking as did Macquarie (A$33.10, -1.9%) the worst of the banks today. BHP Billiton (A$34.95, +0.6%) continues to underperform Rio Tinto (A$61.30, +1.9%), as Iron Ore seems to be returning to favor. Even Arrium (A$0.86, +7.5%) was in demand. In industrials, Brambles (A$7.27, -2.3%) fell victim to some selling as did David Jones (A$2.48, -1.2%) and JB Hi-Fi (A$10.03, -1.6%). Golds were mixed with Silver Lake Resources (A$3.29, +1.9%) stronger as were Papillion (A$1.70, +8.28%) and Evolution Mining (A$1.795, +1.4%).

So the question is does Santa exist? Well, looking at the numbers it appears he does. Over the past 70 years they show that the Australian share market generally performs better in December than other months of the year. Actually the stand-out month over the past 70 years has been January, with the All Ordinaries rising in 50 of the 70 years and gaining on average in the month by 1.9 per cent. But not far behind is December, rising 49 times in the past seventy years and lifting on average by 1.8 per cent in the month. The interesting point is that December has indeed been a consistent out-performing month over time and certainly the best month to buy shares over the past 20 years. And if you track back at decade intervals starting at the last 20 years to the past 70 years, December has been the number one month. So there it is folks…60% of the time it works every time!

Volume was again on the low side but it was a Monday and Xmas is coming! The undercurrent in the market is still for a squeeze up .I is hoping for a 4650 by the time Santa asks if you have been naughty or nice.

Stocks in the news

The big story today was the Channel Ten Network (A$0.245, -9.1%) rights issue and subsequent fall further from grace. In other media stocks Southern Cross Media (A$1.04, -5.9%) were pilloried for their prank gone wrong which resulted in the tragic death of a British Nurse.

Linc Energy (A$0.885, +9.3%) had another fantastic day today fuelled up by the deals they have done in the last few days. The corner appears to have been turned and $1.00 could be possible in the next week or so.

BBY favorite Buru Energy (A$2.77, -2.1%) continues to underwhelm after news of a new Managing Director failed to impress the market. In other energy stocks Woodside (A$33.93, -0.8%) continues to expand into the Old Burma with a deal to buy into a block in the Rakhine Basin. The offer is for a 50 per cent interest in block A-6.

Australand Property (A$3.21, +6.3%) has been approached by GPT (A$3.63, +0.8%) to buy the business well all except the residential business that is.

Fortescue Metals (A$4.05, +6.9%) improved after selling a 25% interest in their Nullagine Iron Ore JV to BCI for $190m.Whilst BC Iron (A$2.93, unch) remained in a trading halt as it seeks to raise additional capital to cover the cost of the purchase.

And talking of Iron ore stocks Atlas (A$1.385, +6.5%) has completed a $US275 million financing package to put it on track to produce 12 million tonnes per annum by December 2013.

And in macro news, Iron-ore shipments from Australia, the world’s biggest shipper of the steel-making ingredient, advanced to a record in October as a strengthening Chinese economy boosted demand. Exports gained 7.6 % from September to 44.2 million metric tons, according to government data compiled by Bloomberg.  Shipments to China climbed 11 %c to 34 million tons, the data show.

In domestic economic news, Home-loan approvals rose less than economists forecast in October even after central bank interest-rate reductions aimed at stimulating the economy and boosting the housing market.

The Australian Bureau of Statistics (ABS) said the number of loans granted to build or buy houses and apartments advanced 0.1 per cent from September, when they rose a revised 1.1 per cent. Economists had predicted approvals to increase 3 per cent.

Tomorrow’s News Today

In corporate news to come tomorrow, looks like Bloomberg is looking at adding the FT to its suite of products. Barbarians at the gate for the mighty pink broadsheet!

Important events are the FOMC meeting on Wednesday, where analysts now expect the Fed to increase their monthly asset purchase target under the QE3 program to $85bn per month, up from $45bn per month On the data front industrial production numbers for October will be released around the world including in the Euro-area, US and China. We also get the US retail sales number and December flash PMIs for the Euro-area and China.

Japanese recession will make some headlines around the World and obviously the Fiscal Bluff will be back in the spotlight. As we approach the high for the year of 4571 reached in October, it looks certain we will push through that on any good news. Must be some somewhere surely. There is and stop calling me surely!

 

That is all!

Clarence

XXX