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Well the US seems oblivious to the woes in ‘Zombieland’ , so maybe we should be too..They point out that Cyprus is so small…its only about the same size as Lehman was!
Anyway, as the Banks there struggle to open, the haircut for some depositors looks like it will be 40% on uninsured savings and 80% at others. In a month there will not be a banking system left in Cyprus. However as deposits are withdrawn across the Zombie zone, perversely we could see a rise in equity markets as the money has to go somewhere. Now would you rather have your hard earned in a savings account in a dodgy Euro Trash bank or earning a yield in a blue chip Euro company with the portability that share ownership entails. Mmm! Tricky…still you get my drift here…shares may be better than deposits…maybe safer too!
Back to our anaemic market here.4950! Again! Will we see a decent rally…well today, emboldened by the Dow ,we will..SPI up 9 but will be much more than that especially early. Expect 30 odd points with banks leading the charge as usual. It is also expiry day today ,so some stocks will get pulled to their strike prices if there is big open interest there.
Canada was down last night as commodities stocks suffered but the Oil price is looking far better climbing to its highest level in five weeks..up 1.6% last night! Expect energy stocks to improve today!
Where is the market going for the next six months I hear you say….Sideways I answer!!Range is 4850 to 5150..trade it on those risk/reward parameters and you cannot go wrong…that means selling when it is at 5150 not buying and buying at 4850 not panicking and selling..that is all!
Idea of the Day
News today of further good intersections at SIR with their Bollinger project…now they will bounce hard but one that I have bought for myself is SFX..very high risk but they have a world class mineral sands deposit at a project called Thunderbird and an interesting Nickel/Copper project very close to SIR called Red Bull…roadshow coming real soon..don’t need any money..unusual and could prove worth a small look…other than that usual suspects…media stocks (TEN,APN)BDR and KAR from yesterday’s note…
Things to make me look forward to the Ashes!!
1.Yesterday we got a great reminder why test cricket is so amazing to watch. Down to the wire!!Great Result from England!
2. Karoon Gas’ discovery in offshore well 1KPGL2SPS hasn’t yet been declared commercially viable, according to a posting on the website of Brazil’s National Petroleum Agency.
3. Origin Energy is in fundraising mode to help meet its $4.4 billion commitment for the Australia Pacific LNG project in Queensland, potential asset sales include the APLNG pipeline and the Ironbark coal seam gas resource. A sale of the APLNG gas pipeline, already aired by Origin boss Grant King as a possibility, could raise between $380 million and $470 million.
4.Ramsay Health Care is planning an aggressive expansion in Asia after signing a deal worth about $500 million with Malaysian conglomerate Sime Darby. The new venture, called Ramsay Sime Darby Healthcare, is being funded by cash and existing credit facilities.
5.A 2011 Oklahoma earthquake has been tied by researchers to the disposal of wastewater from oil production, the latest study suggesting the energy boom from advances such as fracking is increasing temors.A series of quakes in November 2011 followed an 11-fold bump in seismic activity across the central U.S., as disposal wells are created to handle the increase in hydraulic fracturing, or fracking, for oil and gas, geologists at the University of Oklahoma, Columbia University and the U.S. Geological Survey said in the journal Geology today.
6.Good to see an inquiry into Tomwaterhouse.com and his confusion on being a commentator and a bookie. As gambling takes a much bigger role in Sport it is inevitable that match fixing will become more prevalent…sad but inevitable I am afraid and when kids quote betting odds for the Under 6’s versing their local rivals do not be surprised. IMO he should be banned no matter how much he is paying..
7.Signs of life in the Irish economy show the other Zombies the way to go…it now has the third fastest growth rate in the Euro zone…plus a 12.5% Corporate tax rate!!No wonder Google, Ebay and other masters of the tax dodge are moving there. Cheap labour, housing affordable and next to no tax..no brainer..take note Spain,Portugal,Italy,Greece etc!
8.The US house cash machine is up and working again.. More American homeowners will be able to use their properties as cash machines again after real estate equity jumped last year by the most in 65 years. Property owners recaptured $1.6 trillion as home values climbed to the highest levels since 2007. The amount by which the value of the houses exceeds their underlying mortgages rose to $8.2 trillion last year, a gain of 25 %, according to Federal Reserve data. So why did consumer sentiment fall so hard last night…low interest rates and house prices going up…easy money chasing equity assets again..surely we cannot repeat the sins of the past..surely not?
9.And more from the US..Fed Reserve member Dudley has said that the current drag on the economy is pretty darn big with the budget cuts,so if the economy can survive this then anything is possible!!Well not exactly his words but that’s the meaning…of course if the US economy starts to look really good they will take away the $85bn a month in liquidity and then the headwinds will really start!!!
10.And folksey Warren Buffet is looking to move into the top ten at ‘Goldman sucks’ share register with news he won’t have to pay a penny to do so…he has an option to buy the stock at 115..currently trading at 147 so he gets shares equivalent to the profit on the shares without having to write a cheque or anything…gees he is good!
11.And here’s an idea that may catch on from Canada, the banking regulator, the Office of the Superintendent of Financial Institutions, said today the nation’s six largest banks will be subject to a surcharge equal to 1 % of risk weighted capital by Jan. 1, 2016.
There was a bit of confusion at the IGA store this morning.
When I was ready to pay for my purchases of groceries the cashier said, “Strip down, facing me.”
Making a mental note that I should complain to her boss and the IGA franchise people, I did just as she had instructed.
When the hysterical shrieking and alarms finally subsided, I found out that she was referring to my credit card.
I have been asked to shop elsewhere in the future.
They need to make their instructions a little clearer!
Have a good day..enjoy the bounce…not sure it will last though …feel the market is moving into the sideways mode for the next quarter.
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