Some calmness was restored to the market today following a week of more surprises than a Freddie Kruger movie. On Monday we got kicked along as Lounge Room Larry withdrew from the race to be the Fed Chief and this was followed up on Wednesday night by Uncle Ben continuing to give the markets the sugar hits. Records fell across the globe on Markets as the free money looks to be going for somewhat longer than some commentators thought. It was this inevitably that we slowed a little today and took some money off the table. For the week we are up around 1% and closed around 5276 down 19 today. But looking at the chart it’s been a straight line since late June. It is the German elections this weekend. Now it’s pretty certain that Merkel will get back in but looks like she may have to do a deal with some new partners. Anyway financials and big ticket resources led us down. Australia and New Zealand Banking Group Limited (A$31.09, -0.5%) and Westpac Banking Corporation (A$32.75, -0.7%) were the worse whilst recent market darling National Australia Bank Limited (A$34.86, -0.5%) were little changed. In big resource land we saw some easing of BHP Billiton Limited (A$36.39, -0.8%) and RIO Tinto Limited (A$62.91, -1.1%) together with Fortescue Metals Group Ltd (A$4.56, -0.4%). Property trusts were easier today with Mirvac Group (A$1.765, -0.8%), GPT Group (A$3.56, -2.2%) Stockland (A$3.88, -1.5%) Dexus Property Group (A$1.01, -3.3%) all in the red whilst other defensives like Woolworths Limited (A$35.02, +0.7%), Wesfarmers Limited (A$41.51, +0.3%) and Telstra Corporation Limited (A$4.96, +0.8%) were slightly positive.
Energy stocks were easier with the exception of Origin Energy Limited (A$14.45, +2.7%). No real damage done in the others like Woodside Petroleum Limited (A$38.92, +0.3%),Oil Search Limited (A$8.63, -0.9%) and Santos Limited (A$15.05, -0.3%) though. Golds were mixed despite the shiny stuff holding most of its gains in recent days. Beadell Resources Limited (A$0.85, -2.3%),Kingsgate Consolidated Limited (A$1.795, -6.0%),Newcrest Mining Limited (A$13.10, +1.3%),Silver Lake Resources Limited (A$0.84, -1.2%),Evolution Mining Limited (A$0.86, -4.4%),Regis Resources Limited (A$4.16, +1.5%) and St Barbara Limited (A$0.605, -7.6%) were pulling back a little but Newcrest Mining Limited (A$13.10, +1.3%) bucked the trend.
Volume was anaemic to say the least following a big day yesterday on the futures expiry so caution still remains. Around $3bn for a bull market isn’t great. Even the computers are complaining.
Big winners today included Hutchison Telecommunications (Australia) Limited (A$0.053, +10.4%),AIZ,AP Eagers Limited (A$4.71, +2.8%),NPX,STW Communications Group Limited (A$1.61, +1.9%),IFZ and Slater & Gordon Limited (A$3.69, +2.8%) whilst in the doggy house today were Sirius Resources NL (A$2.79, -1.8%),Arrium Limited (A$1.235, -5.0%),Virgin Australia Holdings Limited (A$0.45, -4.3%),Evolution Mining Limited (A$0.86, -4.4%), Rcr Tomlinson Limited (A$3.58, -3.2%),Buru Energy Limited (A$1.73, -0.9%),Charter Hall Group (A$3.80, -2.6%) and Southern Cross Media Group Limited (A$1.825, -2.4%).
Asian shares ran out of steam too today .The MSCI Asia index is up around 3.3% for the week, its biggest gain in more than a year despite South Korea and HK closed today for holidays.
Stocks and Stories
Few house stocks in the news RGS continued their tentative steps as a listed company and slipped a little. Universal Coal PLC (A$0.11, +15.8%) had a good day but Cockatoo Coal Limited (A$0.054, -14.3%) suffered after their announcement of their loan facility from KEBA. Cokal Limited (A$0.20, -7.0%) also eased followed a placement to the Blumont group.
Resources giant BHP Billiton has opened a $US1.5 billion gas plant it says will supply 20 per cent of Western Australia’s domestic gas for the next two decades.
Sydney Airport (A$4.06, +1.5%) continues to push ahead following passenger numbers today. The number of travellers through Sydney Airport rose by 2.4 per cent in August to 3.2 million, with strong growth in visitors from India, China and Malaysia.
Land prices in Japan’s three largest cities rose for the first time in five years – albeit modestly – signalling a return of confidence among homebuyers and investors. The average price of land in Tokyo, Osaka and Nagoya gained 0.1 per cent as of July 1, compared with a 1 per cent drop a year earlier, according to a report from the Ministry of Land, Infrastructure, Transport and Tourism.
Boart Longyear Limited (A$0.49, unch) was put into a trading halt pending an update on its funding plans.
Tomorrows News Today
Brazilian Oil auctions draws little interest from UK and US companies as concerns on state control sapped enthusiasm.
Expect ‘Zombieland’ to give a little back tonight as markets pause for breath after this week’s runs and the German Election will keep some players sidelined.
Despite the optimism in the UK’s economy-mainly due to London House price rises! Productivity has gone into reverse since 2007, and the gap with the US and Germany is now as big as it was two decades ago. Not great news. But then again Order books for UK factories are at their highest level since the onset of the financial crisis six years ago, the CBI said.Underlining the recent upward trend in manufacturing, the monthly snapshot of business conditions showed demand improving both at home and abroad.
Expect some downgrades to the World economic outlook from the IMF in the next few days as Lagarde is feeling a little left out of the spotlight at the moment!
The Irish Republic’s economy has emerged from recession, according to official figures. The economy grew by 0.4% in the second quarter of the year, although this was much weaker than many economists had forecast.
Today, Prince Charles becomes the oldest heir to the throne since 1714 – the record-holder Sophia never got to reign.
This week’s award for trying too hard goes to a Chinese man who tried to sell his Hyundai as a Lamborghini Aventador -$17,000 may have been the giveaway on the price tag! Nice try! Reminds me of the Coalition Broadband policy!
On the TV this afternoon on Business view with Dr Shane Oliver. Have to behave!
This is my last report for a few weeks. As Arnie said though, ”I’ll be back”. Maybe?