Solid day for the market. Not even the mini budget could upset the momentum. Its onwards and upwards. Continuing good numbers from the US and now ‘Zombieland’ have ensured that the Bulls are firmly back in charge. Central Banks show no sign of any tapering at all ,so no reason to leave the party yet .A closing high of 5116 was reached today as we head towards 5200 in the next week or so, as pretty much all sectors continue to fire. Few red spots today as financials leapt with Westpac Banking (A$31.46, +1.9%) leading the way ,followed by National Australia Bank (A$31.17, +1.4%) and Australia and New Zealand Banking Group (A$29.92, +1.8%), likewise in other financials Macquarie Group (A$45.20, +3.9%) were highly sought after following the recent falls. 20 points of today’s rise was in the big four banks as they breathed a collective sigh of relief! Seems the scare yesterday was just that a scare and the FCS(Financial Compensation Scheme) is hardly going to touch the sides. Resources also pulled away with BHP Billiton (A$35.75, +1.6%),RIO Tinto (A$59.31, +2.4%) and Fortescue Metals Group Ltd (A$3.80, +3.5%) strong as the lower Aussie combined with better commodity prices to bring out the sunshine. Energy stocks were also better with Woodside Petroleum (A$38.75, +1.3%) leading Santos (A$13.98, +1.6%) and Oil Search (A$8.21, +1.0%) up. In industrials Amcor (A$10.79, +0.5%) were marginally better after yesterday’s announcement but others like Leighton (A$17.44, +4.1%),Wesfarmers (A$41.07, +0.8%),Seven Group (A$7.00, +1.3%),CSL (A$67.67, +1.3%),Carsales.Com (A$10.06, +1.2%),Computershare (A$10.09, +1.2%),NNC# and News (A$34.50, +2.4%) improved. The only red spots were confined to Gold stocks yet again as Kingsgate Consolidated (A$1.535, -5.5%),Beadell Resources (A$0.69, -8.0%),Evolution Mining (A$0.815, -5.8%),Newcrest Mining (A$12.02, -2.1%) and Silver Lake Resources (A$0.69, -8.6%) suffered. Little weakness too in the Property trust sector as Westfield Group (A$11.30, -0.4%),Dexus Property Group (A$1.015, -1.5%),GPT Group (A$3.59, -1.4%) and Stockland (A$3.62, +0.8%) all eased.

In the winner’s circle today in big cap land included Magellan Financial Group (A$12.04, +5.5%),Arrium (A$1.05, +5.0%),Linc Energy Ltd (A$1.805, +4.6%).Cardno (A$5.84, +4.3%),Flexigroup (A$4.68, +3.3%),Leighton (A$17.44, +4.1%).McMillan Shakespeare (A$8.70, +3.6%) and Platinum Asset Management (A$6.35, +4.3%) whilst in the losers Beadell Resources (A$0.69, -8.0%),Resolute Mining (A$0.715, -10.1%),Evolution Mining (A$0.815, -5.8%).Oceanagold (A$1.65, -5.4%).Regis Resources (A$3.37, -5.1%),#YAL# and Reece Australia (A$23.68, -3.3%).

Volume remained thin considering the strength of the market and the Government announcements today. We are now up 10% since Kev13 took over the Lodge! And 10 straight days in a row of gains!

Stocks and Stories

SDF listed today and knocked the lights out with a big jump from the IPO price. Seems like they have timed this one well.

OrotonGroup (A$6.80, -7.1%) fell today after the company warned softer-than-expected trading conditions in the second half would shrink its earnings for 2013, with earnings to fall off a cliff in 2014 due to the loss of its flagship Ralph Lauren licence.

Paladin Energy Ltd (A$1.00, unch) has abandoned its sale of a minority interest in its Langer Heinrich mine and has instead plumbed for a placement as the bids it got were too low. The stock will be placed with institutions under a variable price book build.

ResMed Inc. (A$5.45, +2.4%) has lifted its dividend by 47 per cent following a strong June quarter when revenue hit a new record. Revenue of $US414 million rose strongly from $US371 million a year earlier. The net profit fell to $US73 million from $US76.8 million following a $24.76 million settlement paid to the University of Sydney with the funds used to establish two academic chairs in perpetuity.

Barrick Gold has flagged the possible sale of its Plutonic mine in Western Australia, along with its three Yilgarn mines, which were put up for sale earlier in the year, as it seeks to slash costs.

Big news today was obviously the Mini Budget as the Government had their own confession season announcement. Seems things have got worse. Most people already knew that and the private forecasters have been telling the Treasury this for ages! Banks will squeal but it’s not even a factor. Does set a bit of a precedent though going forward for this levy(tax) to be raised. Far easier to raise a tax than put in a new one!

Highlights included:

$33 billion – revenue down over four years
$17.4 billion – new taxes and savings
2.5 per cent – new growth forecast for 2013-14, down from 2.75 per cent
6.25 per cent – unemployment rate revised upwards from previous estimate of 5.75 per cent
Tomorrows News Today

Reporting season moves up a gear next week but the dominance of the banks will overshadow any disappointing results.

Meanwhile in Europe we continue to see green shoots of a recovery in both unemployment and industrial production. Inflation remains contained at under 2% so Super Mario is starting to feel a little happier as will ‘Moaning Mertle’ as she fronts the ‘Volk’ in September.

Oil firm TransCanada has unveiled plans to build a pipeline from western Canada to the country’s Atlantic coast, as its plans for a US pipeline remain stalled. The 12bn Canadian dollar ($11.6bn; £8bn) Energy East line would carry up to 1.1 million barrels of oil per day.

China’s non-manufacturing purchasing managers’ index is scheduled to be released tomorrow, after the manufacturing gauge unexpectedly strengthened in July, data yesterday showed.

Apparently Fabulous Fab Tourre (Goldman’s trader) was solely responsible for the GFC and will now be punished accordingly.

And most importantly expect a decent US jobs number tonight to keep things kicking along. Expectations are for a rise in US jobs numbers by 185,000 after a 195,000 gain in June, and for the jobless rate to drop to 7.5 per cent, matching a four-year low, from 7.6 per cent. Of course if it’s too good then Tapering talk will re-emerge.

Back on Sky Business this afternoon at 5.30pm!

That is all

Clarence

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