Well, after yesterday’s rise we get todays fall. Mirror image just about. All engines reversed as financials finally succumbed to Newtons law. The banks bore the brunt of the selling with Commonwealth Bank of Australia (A$72.48, -1.4%), Australia and New Zealand Banking Group (A$29.64, -2.0%), Westpac Banking (A$31.48, -1.0%) and National Australia Bank (A$33.09, -0.8%) in the spotlight with insurers also weaker as QBE Insurance Group (A$15.40, -1.8%) led them down. The twister in the US has potential to hurt QBE but as yet we have no more details on their exposure. After the horror of the last month or so it was heartening to see Gold stocks move higher. It had to happen as they have been dramatically oversold. Newcrest Mining (A$15.60, +7.1%) led the charge, not a phase I write very often but others also shone. Regis Resources (A$3.84, +6.1%), Oceanagold (A$1.82, +4.0%), Evolution Mining (A$0.835, +5.7%), Silver Lake Resources (A$0.73, +2.8%) and Kingsgate Consolidated (A$1.56, +6.5%) Let’s hope this is the start of a sustained rally rather than a cat that is doing a great impression of bouncing!

Today’s casualties included Transfield Services (A$0.97, -23.9%), Downer EDI (A$3.75, -9.4%), Linc Energy Ltd (A$1.40, -6.4%) and Monadelphous Group (A$16.60, -4.7%). Mining services are still on the nose as yet another service company came clean on the downturn in their outlook. Transfield Services (A$0.97, -23.9%) take a bow. Overnight Caterpillar in the US also moved to taper expectations, something we have been getting used to here in Australia.

Media stocks were not hitting the high numbers today Fairfax Media (A$0.61, -2.4%), Ten Network (A$0.265, -7.0%),APN News & Media (A$0.33, -1.5%) and Seven West Media (A$2.28, -3.4%) all fell.

The only bright spots of green on the market map were BHP Billiton (A$34.83, +0.1%) and Newcrest Mining (A$15.60, +7.1%) in large caps along with Origin Energy (A$13.31, +1.8%) and ever solid Telstra (A$5.13, +0.6%).

Big movers today included Panaust (A$2.35, +4.9%), Oz Minerals (A$4.31, +4.4%) and Sandfire Resources NL (A$6.53, +2.8%) and Ainsworth Game Technology (A$4.42, +5.5%) while fallers at the first included Southern Cross Media Group (A$1.405, -3.8%), Cardno (A$5.50, -3.7%) and Lend Lease Group (A$10.08, -4.9%).

Volume was slightly better than the norm but still seemed quiet and we are back where we started on Monday morning!

Stocks in the News

Today we got the update from Transfield Services (A$0.97, -23.9%) together with a rare moment for Boart Longyear (A$0.78, -0.6%) as they announced profits to be at the lower end of the range. The market actually rallied as analysts expected worse I suspect. The stock has been hit very hard recently so it was some relief to long suffering shareholders to be told the not so bad news.

The grey nomads favourite stock Fleetwood (A$5.65, -25.2%) was unhitched from the growth caravan after last night’s market update. Tried to sneak it through after hours. Seems that portable accommodation is also suffering as the mining boom peters out. They need a caravan of courage perhaps.

Fantastic (A$1.97, -31.6%) also had a less than fantastic day as it fell hard. I Once again a profit downgrade at 6.50pm last night was to blame. Apparently sales that were expected did not eventuate. Sound familiar.

And they are back!!! Discovery Metals (A$0.20, -41.2%) made a welcome return to the bourse today and promptly got smacked for not fronting up for so long. All that pent up disappointment had to go somewhere. How the once mighty have fallen! Once they rejected a $1.70 bid for the company and now they are trying to find someone with some loose change in their pockets to ensure the directors can pay themselves out and parachute to another mining house. Sounds a bit like Billagone!

Ruralco (A$2.81, +0.4%) Australia’s largest rural services company, has reported a 50 per cent fall in its underlying profit for the first half of the financial year, blaming abnormally hot and dry conditions that drove down livestock prices. However the share price escaped the abattoir and actually posted a gain.

RBA minutes were out today, more like hours, but they were worried about a number of factors. High on their list to explain terms of the below-trend growth outlook, the Bank nominated the high Australian dollar, fiscal consolidation and slowing business investment as the key drivers.

Treasury secretary Martin Parkinson conceded that his department had struggled to keep pace with the tumultuous decade in the Australian economy. Seems they got the easy bit right in wages and employment numbers but were “genuinely surprised by the weakness in prices in the last year ”Weren’t we all!”

Tomorrows News Today

Once again the numbers from China are being questioned. Carson Block, the short seller who runs Muddy Waters LLC, said China’s bad-loan problem is more widespread than just local government debt and includes public and private sector borrowing. Non-performing loan “figures greatly understate the potential scope of the problem of poor-quality loans.”

Apple’s cook will go in front of a senate committee to justify why Apple pays very little tax in the US. Should be an interesting meeting. Easy to grow profits if you pay no tax. It appears that out of the $145m that Apple has in readies, $102bn is held offshore in a Cyprus bank account and they have lost the PIN number.

Apparently tumblrr is set to boost Yahoos revenues…well at least by $13m which is what they turned over last year.Just signed up for my tumblrr account today!!

Dell has reported a 79% slide in net profit, underlining a fall in personal computers sales as more consumers shift to smartphones and tablets.

And its Tuesday in the US tonight and for the last 18 Tuesday’s the market has gone up. ”Benny and the Inkjets” to front the Senate on Wednesday so expect a up day to square up. FTSE to fall from its 13 year high I expect. How can this be!

Clarence
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