Green across the screen as resources continued to find a few friends and financials fighting back slightly after last week’s losses. The market finished on its highs taking confidence with every passing minute. It was only the W’s in the large caps that were down with Woolworths (A$35.39, -0.3%) and Westfield Group (A$11.61, -0.9%) all flashing some red. Best banks were Australia and New Zealand Banking Group (A$28.57, +0.6%) and Commonwealth Bank of Australia (A$69.33, +0.8%) whilst BHP Billiton (A$31.72, +1.0%), RIO Tinto (A$55.12, +1.5%) and Newcrest Mining (A$17.01, +2.2%) led the resource stocks. Asian markets helped sentiment again as Japan led the way as the yen weakened helping exports.

Once again the mining services sector was struggling with Bradken (A$5.12, -5.7%), Coffey International (A$0.325, -5.8%). Macmahon (A$0.16, -8.6%), Maca (A$2.38, -3.6%) and Mastermyne Group (A$1.05, -7.1%) all suffering whilst Boart Longyear (A$0.97, +7.2%) bucked the trend and actually pushed higher.

On the winners’ podium today included Codan (A$3.47, +13.4%), Oceanagold (A$1.955, +6.3%), Sims Metal Management (A$9.45, +6.2%) and whilst grovelling around in their spilt Champagne were Oz Minerals (A$4.30, -10.6%), Carsales.Com (A$9.58, -3.1%) and Silver Lake Resources (A$1.31, -3.0%).

In industrials ,News (A$30.44, +2.9%) was one of the best performing stocks Telstra (A$4.76, unch) pretty much unchanged whilst in other media stocks Seven West Media (A$2.03, +1.8%) and Ten Network (A$0.32, +1.6%) had a good time partying. Seriously!

Energy stocks were better with Woodside Petroleum (A$34.60, +1.5%) recovering nicely nicely and Santos (A$11.91, +2.2%) also doing well after last weeks’ production report. Telcos were again better with Newsat (A$0.415, +5.1%) and Telecom of New Zealand (A$2.11, +1.9%) all dialling the right numbers.

Very slim pickings on the volume front with a struggle to get to $3bn.Anzac day week was never going to be that busy but today was very disappointing.

Stocks in the News

In house stocks Pharmaxis Ltd (A$0.315, unch) is in a trading halt pending the release of its Phase III bronchiectasis clinical trial (B305) of cystic fibrosis drug Bronchitol. In other house biotechs, Mesoblast (A$5.49, +2.2%) announced some positive results from its phase 2 trial for disc repair.

Another house favourite reported today, with Silver Lake Resources (A$1.31, -3.0%) massaging the market ever downwards. FY2013 guidance is reduced to 140-150koz (we had assumed 170koz). Costs increasing and dispute with contractor continuing.

Oz Minerals (A$4.30, -10.6%) is trading at a 10-year low, after the company conceded it would produce about 8 to 10 per cent less copper than forecast this year. It would be great if this issue was only a problem for these guys but it seems that every miner reporting these days is singing from the same hymn sheet.

Discovery Metals (A$0.34, unch), which is still suspended, has announced that top shareholder and former suitor, Chinese firm Cathay Fortune, said it will not support the Africa-focused copper producer’s plan to shore up its funding.

Envestra (A$1.045, +1.5%) hopes to raise $240 million to expand infrastructure and deliver more gas. The company has launched a share offer at 99 cents per share.

Tomorrow’s New Today

Chinese HSBC Flash Manufacturing PMI tomorrow. Next big number.

May budget is shaping up to be a doozy with the deficit back in the spotlight as the Government funding position continues to go from bad to badder!

The Luftwaffe have cancelled the majority of their flight in Germany on Monday as a pay dispute continues. Apparently the Union wants guarantees over job cuts. The company has guaranteed there will be cuts, so what’s the problem!

Spot iron ore prices may approach their lowest level for the year this week with Chinese mills in no rush to stock up on the steelmaking raw material given an uncertain outlook for steel demand in the world’s top consumer.

Shanghai steel futures were steady on Monday, having recovered only modestly after hitting seven-month lows last week during a broad-based commodities sell-down, suggesting investors were not too confident that demand would gather pace in the near term.

China’s slower expansion in the first quarter is “normal” as the world’s second-largest economy sacrifices growth to make structural reforms, People’s Bank of China Governor Zhou Xiaochuan said.

A change in the way the US accounts for intangibles will help their GDP push up significantly. The US economy will officially become 3 per cent bigger in July as part of a shake-up that will see government statistics take into account 21st century components such as film royalties and spending on research and development.

Caterpillar Inc. is expected to trim its full-year profit and revenue forecasts when the bellwether machinery maker reports first-quarter earnings Monday, reflecting the shrinking demand for its mining equipment. Implications for Seven Group (A$8.77, +0.9%)?

Chrissy Amphlett is reported to have passed away in New York..sad news.

Clarence

Cxxx

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