Morning all,

Good to see the Dow celebrate Independence day as the Tanks rolled into Egypt again and the army has kicked out Mursi. Seems to be popular with the people though so at least that’s something..anyway after yesterday’s rout following Uncle Festers really bad joke in Brisbane we may see some buying today. Of course that wasn’t the only reason for the falls but it does show the dangers of computers trading twitter headlines. They do not have an irony or humour button so they just read the headlines and trade! Volumes are low and stocks are thin as its school holidays so easier to whack things around a bit

Feel like the resource space is going to be the one to watch today. Iron Ore up, Gold up ,Copper up and Oil up..Dollar down so BHP is starting to look interesting as is NCM. Nothing like a good Middle East Crisis on the banks of the Suez canal to get the oil price rocking and feed into the Gold price too.

Most eyes will be on US jobs numbers on Friday and they are closed tonight so just Asia and the Zombies to affect our market but this week has shown the joys of volatility..Monday down 95 ..Tuesday up 125..Wednesday down 90..Thursday up 30?..Friday up 20?

We also have reporting season in the US kicking off next week with Alcoa first up so that will reveal the true state of the US economy…

Our market is a mystery at the moment and tempting to sit on the sidelines and wait for the dust to settle..but you know what, we are in a brave new world where the dust may never settle…lunatics have taken over the asylum and volatility = opportunity…

Use the force!

Idea of the Day-NCM looks appealing for all the wrong reasons!

I had a meeting with a client yesterday where we discussed the outlook for NCM. Now let’s face it is has been a  disaster. Everything has gone wrong that could go wrong….but if you were looking at good assets badly managed this would fit the bill nicely.I would not be surprised to see some predator pop up in this one…let’s face it if the CEO and the Board were replaced tomorrow the stock would rally 10%!It is probably cheaper now to buy ounces in the ground and production than try to find new greenfield gold deposits. Certainty is what banks fund..not drill holes for over paid directors in lifestyle companies..that is what shareholders fund!

Things to make me go all Andy Murray!

1.Great tennis last night from Murray to fight back from two sets down…and I even saw him smile…best chance to win this year with Federer out..only Novak Djokovic  stands in his way..again!

2.Woodside Petroleum’s sudden and unexplained shutdown of new $15 billion Pluto liquefied natural gas project has cut production and driven a 4.4 per cent downgrade in full-year output guidance. The unwelcome news on Pluto came as Woodside also advised of a delay in restarting output at its Vincent oil field off WA, which has been out of production since a shutdown for a tropical cyclone in December.

3.Federal Reserve policy makers are ready to start tapering bond purchases in September after Chairman Ben S. Bernanke shocked markets by announcing a conditional timetable, said former Fed Governor Laurence Meyer.

“They have made a decision virtually to go in September unless the data disconfirms their expectations of the continued improvement of the economy,” Meyer said

4.Billabong International: All seven of Billabong’s original lenders have cut their ties with the troubled surfwear company with Bank of America Merrill Lynch and Société Générale the last two banks to exit on Wednesday. It is understood the pair have sold a combined $65 million worth of senior loans, placing the fate of the company in the hands of just a few opportunistic investors. Sources said they have sold to a “loan to own” hedge fund where the fund hopes to convert its stake into an ownership position.

5.Crown/ Echo Entertainment: The winner of Sydney’s casino wars will be known at 1pm AEST today, when NSW Premier Barry O’Farrell is due to front a press conference to declare which rival $1 billion-plus development from Crown or Echo will be recommended to proceed to the next stage of approvals.

6.Flight Centre: Australian leisure travellers have ignored the fall in value of the local currency and continued to book overseas holidays, prompting another profit upgrade. Flight Centre now expects to report a record underlying profit before tax of between $338 million and $342 million, excluding non-cash items.

7.Zombieland once again rocked by the Southern European messes. This time its Portugal in trouble as a couple of big hitting ministers have resigned over austerity, borrowing costs have soared, stock market has collapsed and the country teeters on the brink of the next bail out. And  they just announced a short-selling ban on select banking stocks. Meanwhile Germany is just doing fine thanks. Now we have all heard of PIIGS but now we have France, UK, Malta and Estonia as an mnemonic.

8.Finally some good news for the Gold sector.. Evolution Mining Says 4Q Gold Output up 34% On-Quarter at 112,526 Oz…

9.And here’s a scary thought and shows maybe we have learnt nothing since 2008…US house prices are surging ahead as buyers use cheap loans to speculate on price rises and flip them on to the next buyer at a higher price..lots of new cars being bought on credit and Dow near records bought on margin loans and geared money…haven’t we seen this before when assets get inflated by cheap funds!!!What do they say about History… History repeats itself, first as tragedy, second as farce.Karl Marx..Groucho’s brother!

10.And today the inventor of the mouse has died ,Douglas Engelbart aged 88 has pressed his last right click. RIP…save as…..

And finally……as computers take over the trading rooms around the World remember this one?

“Open the pod bay doors, please, HAL. Open the pod bay doors, please, HAL. Hello, HAL. Do you read me? Hello, HAL. Do you read me? Do you read me, HAL?”

Back on Sky Biz’ Lunch Money so phone up and ask a question on your favourite stock…starts at 12.00 today!!

Clarence

XXX

 

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