We saw the tightest range today for some time with a mere 25 points between the top and bottom as stability returned. Solid bank and Telstra Corporation Limited (A$5.50, +0.7%) performance was outweighed by big miners to close down 3 for the day as a late rally pulled us back from a 15 down day. Love the close! The Chinese HSBC PMI was slightly better than expected at 50.4,which really made no difference. Big four were all strong except Australia and New Zealand Banking Group Limited (A$32.93, +0.2%) and property trusts also rallied well with #SCG#,GPT Group (A$3.99, +0.5%),Mirvac Group (A$1.74, +0.3%) and Dexus Property Group (A$1.185, +0.9%) all doing well. Consumer stocks were also better led by Wesfarmers Limited (A$42.23, +0.9%) and health care stocks also firmed as we get to the interesting part of the Medibank float process. Ramsay Health Care Limited (A$51.10, +2.8%) and #GID# were the stars.

In the doghouse were of course the miners following an investor update from BHP Billiton Limited (A$33.64, -1.8%) in London. Fortescue Metals Group Ltd (A$3.53, -3.6%),RIO Tinto Limited (A$59.87, -2.2%) and Alumina Limited (A$1.655, -2.9%) joined the rout as did oil stocks as Crude dipped below $80.Arrium Limited (A$0.345, +1.5%) bucked the trend but Mount Gibson Iron Limited (A$0.50, -4.8%) shuddered to a halt as did gold stocks again and base metalers like Sirius Resources NL (A$2.96, +0.3%),Oz Minerals Limited (A$4.06, -1.0%) and Western Areas Limited (A$4.45, -4.1%). Going against the trend was Syrah Resources Limited (A$3.62, +12.1%) who a copped speed ticket and a please explain following yesterday’s falls. They promptly went back up with news on their Balama Recarburiser update.

On the podium today were Syrah Resources Limited (A$3.62, +12.1%),SAI Global Limited (A$3.88, +6.3%),Skilled Group Limited (A$2.34, +5.4%),Blackmores Limited (A$32.20, +3.9%),Ten Network Holdings Limited (A$0.245, +6.5%),Ramsay Health Care Limited (A$51.10, +2.8%),Asciano Limited (A$6.09, +1.7%) and Transfield Services Limited (A$1.94, +1.6%) in the bigs with #GID#,#UBN#,#RHP#,Seymour Whyte Limited (A$1.49, +8.0%) in the smalls. Torn and frayed were Toll Holdings Limited (A$5.47, -7.1%),Super Retail Group Limited (A$7.45, -5.9%)(sorry Charlie Aitken!),Mount Gibson Iron Limited (A$0.50, -4.8%),Cardno Limited (A$5.46, -7.1%) and Karoon Gas Australia Limited (A$3.00, -5.1%) in the big ones and Yancoal Australia Limited (A$0.23, unch),Helloworld Limited (A$0.265, -8.6%) and hated Lynas Corporation Limited (A$0.073, -7.6%). Volume was around $3.5bn as usual with the Aussie dollar was 87.60,bitcons $431 and Gold up slightly at AUD $1418.

Asian markets mixed as a Japanese auction for 3 month bonds drew an average yield of negative 0.0037 %. Not sure why you would bid to lose money but there you go. Tokyo was down 0.11%,HK down 0.36% and China down 0.73%

Stocks and Stories

Telstra Corporation Limited (A$5.50, +0.7%) Investor day and trading update. Pretty much all good in the Telstra garden. iPhone 16 was a good launch and another 937,000 have signed on as subscribers in the 12 months to June 2104.

Toll Holdings Limited (A$5.47, -7.1%) today announced at their AGM that trading conditions were tougher than expected in the first quarter in the volatile macro environment, but has reiterated its full-year earnings guidance.

Oil Search Limited (A$8.60, -1.4%) has seen a huge surge in quarterly production thanks to the start-up of the $US19 billion Papua New Guinea liquefied natural gas project with output in the September quarter only marginally below that for the whole of 2013.Production reached 6.67 million barrels of oil equivalent, nearly four times more than in the same period in 2013

Boart Longyear Limited (A$0.23, +53.3%) soared today as a deal looks to have been done by US hedge fund ,Centrebridge, to take control of this Labrador. Centrebridge’s ownership will rise significantly from their current 12.7 per cent shareholding to 19.9 per cent in this $325m deal. Minority shareholder will keep their existing shares.

SAI Global Limited (A$3.88, +6.3%) AGM today with an announcement that they had acquired the rights to the Encompass software for Australia, a commercial data retrieval and analysis service.

AGL Energy Limited (A$13.59, -0.9%) has slightly disappointed the market with its profit forecast, which is softer than the consensus, who were also surprised by a large one-off cost for its $1.5 billion takeover of NSW power producer Macquarie Generation. Profit for financial 2015 excluding one-off items is expected between $575 million and $635 million,

Atlas Iron Limited (A$0.36, unch) also tweaked up its production forecast by about 2 per cent for the year to June 2015 to 12.4-13 million tonnes. It has cut its all-in cash costs to $68.90 ($US60.45) per tonne delivered, from $75, while it received an average price of $70.83.

Tomorrow’s News Today

Bank of England policymakers have signalled that there will be no rise in interest rates soon amid slowing economic recovery and heightened risks from the Eurozone.

Remember back in the 80’s, Bunker Hunt and his brother tried to corner the Silver market. Well he has died. The silver play sent him bankrupt as they changed the rules on him and his brother resulting in a huge plunge in the price. Happy day. Obviously not for him but I remember it well.

Here’s a story that will bring shivers into the hearts of Bunnings management and Masters! Homebase in the UK will close a quarter of its 323 branches in the next three years, blaming an excess of retail space at out-of-town stores and the rise of a generation with little interest in DIY projects. Suspect Gen Y will not want to spend their Saturdays talking to old duffers in a a apron in the endless aisles that are Bunnings too!

US car safety regulators have expanded a recall of vehicles with potentially dangerous Takata airbags to 7.8 million. Sounds like mostly Hondas are affected.

South Africa has downgraded its economic growth. Nhlanhla Nene, the finance minister, told parliament in his medium-term budget statement that economic growth would only be 1.4% this year. GDP growth was earlier forecast at 2.7% in the full budget back in February .Oops!

And Tesco in the UK have floated the idea of selling their Asian business. Could be worth between 8 and 10 bn pounds. Numbers today should show the extent of their pain and accounting irregularities. Not one of Buffet’s best moves but at least he has admitted his mistake!

That is all

Clarence

Xxx

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