Market Review

After record highs on the Dow and Agar’s performance overnight it was all systems go. A very positive open topping out at 5012 gave way to some nerves especially in the Financials where banks slid from gains to losses.  Eventually we closed well off the highs around 4974.Looks tired! Maybe next week we can consolidate above 5000. National Australia Bank (A$29.94, -0.1%) came closest to staying in the black whilst Commonwealth Bank of Australia (A$70.97, -0.6%), Australia and New Zealand Banking Group (A$28.72, -0.9%) and Westpac Banking (A$29.11, -1.3%) all gave up the early positives. However the big positive moves today were from our old friends the resource stocks. BHP Billiton (A$33.31, +1.4%) had a good day as did Fortescue Metals Group Ltd (A$3.54, +2.6%), RIO Tinto (A$54.74, +0.8%) and even Newcrest Mining (A$12.09, +8.9%) on the running gold price. Biggest gain this week in two years! Big rallies too on other resource stocks with Evolution Mining (A$0.685, +3.8%), Kingsgate Consolidated (A$1.59, +6.0%), Silver Lake Resources (A$0.78, +3.3%), Panaust (A$1.99, +4.7%),Oz Minerals (A$4.15, unch) and quasi resource stock Arrium (A$0.905, +4.0%) doing well.

Industrials fared well in places especially in food related with Wesfarmers (A$39.09, +0.3%), Woolworths (A$33.99, +1.3%) and Coca-Cola Amatil (A$12.90, +3.2%) all showing strength with Telstra (A$4.83, +0.4%) up as well. Property trusts were a little weaker Dexus Property Group (A$1.055, -0.5%) amongst the losers. Energy stocks also gave up some gains as the oil price seems to have come off the boil in the last few days. Origin Energy (A$12.69, -1.4%), Oil Search (A$8.15, -1.3%) and Linc Energy Ltd (A$1.375, +2.6%) slightly easier with Woodside Petroleum (A$37.48, +0.4%) holding up well. Media stocks also in the green with Fairfax Media (A$0.55, +1.9%), Seven West Media (A$2.19, +2.8%), APN News & Media (A$0.28, +1.8%) and Ten Network (A$0.30, +1.7%).

Mining service which have long be under the hammer, finally started to show some signs of life with Maca (A$1.925, +4.3%), Macmahon (A$0.14, +3.7%), Bradken (A$5.15, +3.8%), Ausdrill (A$1.00, +5.3%) and Austin Engineering (A$3.43, +3.9%).

Big winners today included Newcrest Mining (A$12.09, +8.9%),Energy Resources of Australia (A$1.55, +6.9%),AP Eagers (A$4.43, +7.0%),Downer EDI (A$3.82, +3.2%),Monadelphous Group (A$16.34, +6.4%) and Bradken (A$5.15, +3.8%) whilst in the canine club were iiNet (A$6.10, -4.2%), Cabcharge Australia (A$4.28, -3.2%), Xero (A$14.44, -3.6%), News Corporation (A$16.45, -2.37%) and Lynas (A$0.445, -4.3%) following a broker report this week extolling their virtues!

Volume was again sub optimal! Maybe this is the new normal although I would hope that the end of School holidays will bring people back to their desks!

Stocks in the News

Good debut for latest IPO Inabox group (A$1.49) with a 23% gain today. There is some movement in IPO land so expect to see some more coming along.

WorleyParsons (A$21.50, +2.5%) will provide management services to a multi-billion dollar US gas project. The company has secured a contract with the energy group Sasol to provide management services to its giant gas-to-liquid and ethane cracker project in Louisiana.

Apparently his job is done. Really? Anyway Mike Quigley has resigned as head of the NBN effective when they find a replacement. Must have missed out on the fibre to my place…not a marginal seat!

ANZ has announced it will leave its variable interest rate for retail mortgages on hold at 6.13 %.Who needs the RBA eh? Home loans grew by 1.8% it was announced today.

Couple of house oil stocks doing well today with Buru Energy (A$1.665, +1.5%) looking better as were AWE (A$1.42, +1.4%).

Indonesia raised rates today ,caught between rising inflation and weakening growth, its main interest rate was pushed up by a half-percentage point Thursday, while other central banks across Asia stood pat as sluggish exports and a slowdown in China weigh on their economies.

Tomorrow’s News Today

Expect a pullback from the US markets tonight as punters and computers lock in their profits ahead of the Chinese GDP number.

Has China cut its growth number quietly? Their Finance minister said in Washington they would not be unhappy with 7% growth. GDP number due Monday and numbers with a 6 in front would not be a surprise.

Billionaire investor Carl Icahn is ready to raise the stakes in his bid to take control of computer maker Dell. Mr Icahn said he plans to improve his $15.4bn (£10.1bn) offer for the company. All this while PC sales have fallen the most in their history, Worldwide PC shipments totaled 76m which was a 11% drop from a year ago. Must know something we don’t!

Singapore’s economy grew an annualized 15.2 percent in the second quarter of the year from the first, well above expectations for an 8.3 percent rise in growth and its strongest showing in more than two years, data on Friday showed.

Standard & Poor’s warned that the global cycle for capital investment has already rolled over, with early signs pointing to deepening contraction of 5.4pc in 2014. “The capex recovery appears to be ending before it has really begun,” said the agency.

Executives of British drug maker GlaxoSmithKline in China have confessed to charges of bribery and tax law violations after initial questioning by Chinese police, according to the country’s security ministry. The company is suspected of offering bribes to government officials, medical associations, hospitals and doctors to boost sales and prices, China’s security ministry said in a statement on its website on Thursday.

Few things to look forward to next week. ABS Lending finance for May, ABS new motor vehicle sales for June, RBA board meeting minutes, Westpac/Melbourne Institute index of economic activity, ABS international merchandise imports, NAB quarterly business survey. And in more fun and games, “Fabulous Fab” Tourre the Goldman Sucks Bond Trader goes on trial next week! Investors lost more than $US1 billion when the investment vehicle failed, according to the SEC filings. Should be good for a few headlines!

Enjoy the Cricket!