Morning all,

The rumours of the markets death have been grossly exaggerated. Once again the overseas markets showed us the way forward. Ten days in a row for the Dow. Another all-time high obviously and the S&P 500 within a whisker of its all-time high and everyone saying it’s going to 16,000.Well they would but a raft of banks last night announced buy backs and dividends in the US which will certainly help things along. Of course it’s different this time.

Yesterday we saw the Ides of March strike with profit taking across the board as the jobs numbers confounded the experts once again. I would expect a serious revision in these numbers in the months to come..71500 new jobs..really? Anyway it was enough to take rate cuts off the agenda..Now I for one have long believed that this is it for the rate cut cycle as things really aren’t that bad in the economy. We even saw MYR improve yesterday, as sales increases again ,so we are spending and buying record number of cars and house prices are firming. Of course every shop in the high street is being replaced by Real estate agents and coffee shops as retail continues to struggle but 3.1% GDP is pretty good. Back to the old days. Anyway no more rate cuts that’s my call!

Expect our market to have a strong rebound today in the banking sector and other defensives but the poor old miners are going to struggle still with more pressure last night on the Iron Ore price which looks like its heading down further. BHP,RIO and FMG will be laggards but its Friday so we may see some book squaring before the weekend.

I still believe that our market has potential to pull back to 4950 so happy to remain patient in the wings waiting to pounce..like a tiger! Or maybe a fat cat like Garfield perhaps!

Idea of the Day

We were lucky enough last night to have a run through of the Financial stocks from our top rated research team.  Le Mesurier is one of the best in the business and I loved all his appearances in ‘Dad’s Army’, but the upshot was the banks have really done their dash..If you have not been on board then you have really missed this train. He is at best a hold in the sector. However the good yields are going to hold them up..probably the best of the four is WBC with NAB and CBA then ANZ, with as he put it their Greater China Strategy…which apparently is neither Great nor in China! His joke not mine!

IAG is his preferred stock in the sector although it too has run quite far.

Things to make me go mmmmm!

1.US banks paying better divs ,buy backs and returns… JPMORGAN TO BUY BACK $6B IN EQUITY, TO BOOST QTR DIV TO 38C/SHR.. BOFA TO BUY BACK UP TO $5B SHARES, REDEEM $5.5B PREFERREDS.. CITIGROUP PLANS TO BUY BACK UP TO $1.2B STOCK, MAINTAIN 1C DIV

2.And on the other side of the good news is JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon and other managers sought to hide escalating trading losses by misleading investors and dodging regulators after the cost climbed for three straight months, a Senate probe found. The largest U.S. bank “mischaracterized high-risk trading as hedging.”

3. Treasury 30-year bonds fell after the U.S. sold $13 billion of the securities to the weakest demand in seven months amid signs the world’s biggest economy is gathering strength.

4.Chelsea beats Steaua 3-1 but Tores missed a penalty..popped it over the top!

5. APN News & Media’s shares have been ticking up ever since the company’s board spill and annual results. This has investors wondering whether it might be time to reconsider its ill-fated equity raising or even plan a block trade.

6. Myer is on track to achieve its longest run of sales growth in more than six years, fuelling hopes that the tough trading environment and poor consumer sentiment that has pummelled the retail sector in recent times might finally be over. Shares in the company surged almost 6 per cent yesterday to their highest level since May 2011, after the company reported that interim sales had risen 1.7 per cent to $1.73 billion, lifting net profit slightly to $87.9 million.

7.This looks like a good move from WPL to buy a 40% stake in Myanmar gas field from Daewoo International.This looks like a big opportunity for companies going forward Myanmar is a huge resource rich country and has been massively prosperous in the past and entire Oil Companies have been founded on it notably Burmah Oil..there’s a blast from the past .Anyway those that get in there will do very well..the rush has started! In other WPL news ,one analyst is starting to talk about share buy back of around $1bn…this will help this baby too.

8.Last night I watched the story of Enron. The smartest guys in the room..just incredible and of course the film finishes with could it happen again…and it was filmed in 2005..so could it ..well it did  on Wall Street this time ,2008!..one thing is constant the hubris greed and corruption that can take place when people believe their own bull***t.

9.And for the bears out there Gerard Minack from Morgan Stanley is out there again predicting the end of the World.Again…not sure how many times you can predict the end but eventually he was bound to be right ..picked 2008 like a nose…so people listen to him that’s for sure  and here is the chart of the current US market against the US market in the 30’s before it collapsed 40%…WTF!

Thanks to http://www.zerohedge.com for this gem!

10.And in a week when we have a new Pope..it appears they have found God too with the Boson Higgs particle now a reality perhaps…

And finally for my Croatian Friends…Top ten things about being Croatian..

1. The Croatian Adriatic sea costline

2. Palacinke – Croatian crepes and with nutella

3. Firey temper tantrums

4. Great tennis players – ala Goran Ivanisevic

5. Best female skiers

6. Croatian beer

7. Cevapi

8. They are meat heads

9. Like the Italians they too have flexible work hours

10. Close to but not a little PIIGS

And on being English-

Being English is about driving a German car to an Irish pub for a Belgian beer, travelling home grabbing an Indian curry, to sit on Swedish furniture and watch American shows on a Japanese TV. And the most English thing of all? Suspicion of all things foreign!!

Have a good weekend

Clarence

XXX

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