Morning all,

 

After an enforced sojourn to the ‘Old Dart’, I am back on board today. The market has been pretty impressive whilst I have been away and the same old stocks have led the way..banks, TLS…it’s been a very crowded trade and the money keeps getting pulled off the sidelines and put to work in the banks.. My target for the market of 4950 by March was well and truly reached with the overriding mantra of “it’s the yield stupid” being foremost…so where is my target now…well I would like to see a pullback before we kick on again the chart is a straight line since before Xmas…the best gains in the market are usually in the first half of the year so I would expect us to run into headwinds as we get over Easter but until them ..sit back and enjoy the ride…reporting season has been relatively good but nothing to really push the market higher but current levels are being sustained by the weight of money argument as investors don’t want to miss out…brokers have been busier than they have for some time as deposit money is being put to work mainly in the yield plays…

 

Idea of the day

APN looks an interesting situation with the recent implosion of the board and management this one looks ripe for something…not sure what but the recent numbers, APN News & Media Limited (APN) reported underlying NPAT of A$54.4M, above our cautious forecast of A$46M and slightly ahead of consensus (A$52M).

 

This one has turnaround potential here and is a speculative buy with a target of 35 on some good news..

Things to make me go mmmm

1.The moment I leave the UK it loses its AAA rating..sterling is now at a 28 year low to the Aussie dollar…UK is now a very cheap place to visit!!

Britain’s debt as a percentage of gross domestic product will climb to 98 percent next year from 90 percent last year and 95.4 percent in 2013, the European Commission said in its winter forecast on Feb. 22.

 

2.Italian elections in progress…expect a hung Parliament with amazingly Berlusconi having a good showing!!There is a joke there somewhere!!

 

3.Channel Ten moves to sack its CEO..amazingly Lachlan is still in charge…he is the one responsible for this disaster.

4. QBE Insurance is joining the ranks of Australian financial services companies’ offshoring jobs and business functions as it seeks to lower costs. Company documents suggest QBE plans to employ more than 700 staff in a Manila-based group shared services centre by the end of 2013.

 

5.Results continue to flood in with KCN and GEM out this morning and these to come…

 

Caltex Australia full year results

Spark Infrastructure Trust full year results

Breville Group first half results

Patties Foods first half results

IOOF Holdings first half results

 

6.After Thursday’s big fall, Friday was a very positive day although it did give up some gains…volatility may increase as we push on …dips are there to be bought though at the moment.

 

7 Buoyed by a turnaround in its refining operations, Caltex Australia has returned to the black, posting a net profit of $57 million for 2012, a reversal from the loss of $714 million posted in 2011 – even after making a large provision for the closure of its Kurnell refinery. Kurnell will close in 2014..dividend was cut but market may look beyond that to the new look company ex Kurnell.

 

 

And finally….

 

A 60-year-old man is getting his annual physical:

 

– Doc, do you think I’ll live another 40 years so I can reach 100?

– That depends,” says the doctor. Do you smoke?

– No

– Do you drink?

– No

– Do you fool around with loose women?

– Of course not

– Well, then, why the hell do you want to live for another 40 years?

 

Have a good day and it’s good to be back…we should be very grateful that the economy here is as strong as it is…UK will be in strife for years to come!!

Clarence

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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.