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Morning sports fans,
A very volatile last night in the US where ‘irrational exuberance’ continues..in fact the biotech sector that Janet Yellen warned about late last year is now up 35%!!Last night the Dow moved 450 points and finished down 27!!!It was a Tuesday after all and Tuesday are the most positive of days, so the rally to the close was not completely unexpected ..but 450 point trading range…I reckon that is flashing warning lights..
The Dow Last night!!!
Now it’s easy to be a bear….especially when I have Gerard Minack for company, and it’s hard not to feel that way given what is happening in the world…the one shining light is the US economy and it is sucking in money like a giant Black Hole..I am sure there is a joke in there somewhere but will let that one alone!! Zombieland is eagerly awaiting the Grand Plan from ‘Do Nothing’ Draghi…better be good…Greece exit will continue to add to nerves and then there is the UK elections…should prove interesting given the rise of the Anti-Europe party UKIP..they currently have 18% of the vote in the latest pole…Cameron has his work cut out…the UK could leave the EU!!Lucky they don’t use the Euro ,it’s the only thing that has saved them and their Euro neighbours like France and the Netherlands must look across the Channel with envy as they print their own money and control their own destiny…
Our market looks set to continue to slip …as a commodity economy we are struggling and no help from “Neverland”(Canberra) ,we need to see the dollar lower to offset the pain…but with rates and returns pretty good here we will continue to trade a bit higher than fundamentals allow..I am expecting the ASX200 to try to bounce a little today amazingly…but not much conviction about it really…jobs vacancies later today and more US numbers tonight..and we wait for ECB printing press to start!!!
Idea of the Day
Defensive peeps…the market looks very rickety to me…built on a sandbar…the one stock that I really feel comfy with is Telstra…this behemoth of data is feeding our addiction…the human race is starting to evolve with our heads pointed down..no wonder we don’t see what is coming ,we are too busy showing our followers our awesome life..mine isn’t anywhere near as awesome as my friends so I am starting to feel completely inadequate…but I digress..Telstra is an inward facing domestic dealer of an addicted substance, namely being awesome on face book( data)…they have the best network by a mile, they have done a great deal with the current government on the copper wires and their customer service has improved out of sight(which wouldn’t have been hard to do) and importantly the company throws off huge amounts of cash and pays a fat dividend..which is why it is $6.05 and a shining light in a sea of red…my old friend Charlie Aitken who does a far better letter than me loves it too..so I am in good company…now over 6 bucks is a big price to pay and if the market continues to slide they will drift back too but these babies should be front and centre of your shopping list!!!
Things to make me go mmmmm!!!
Go the Socceroos!!!
Love the solidarity for Free Speech from World leaders…of course the UK PM wants to ban messaging apps as this is not the type of free speech they want..
Now I am a simpleton but if you have 50% youth unemployment ,whether they are Muslims, Christians, Jedi or whoever they are bound to get a feeling of hopelessness..much easier to radicalise young people if they feel marginalised, disaffected, hopeless and impoverished…if we really want to wage a war on terrorism then improve the economy in these countries…get them a house ,a mortgage, a family, a job ,responsibilities and see how that improves things..just a thought…
Camera on a stick ,stock GoPro slumped 15% last night as Apple announced a new patent for taking selfies by remote control from your new Apple watch…here’s a copy of the patent…
Goodbye Selfie stick!!
The World Bank has cut its forecast for global growth in 2015 thanks to a faltering recovery in the euro zone, tighter monetary policy in developed countries, and the prospect of a deep slowdown in emerging markets, despite an expected lift from lower oil prices.The Bank is forecasting global growth to hit 3 per cent this year, down from a 3.2 per cent prediction in October, which was also revised down from 3.4 per cent in June last year.
Chinese December trade data was generally better than expected with exports up 9.7% YoY and imports down 2.4%.Looks like they are stocking up on Iron Ore too at the se low prices.. Iron ore imports were up 13.8% YoY. Separate reports showed China imported 86.85 mil tons of iron ore in December and 932.5 mil tons YoY, both record-high volumes.
They are buying everything really…huge buyers of physical gold, oil and other commodities at these knock down prices..Sydney houses also figure too…
£6bn…..The hit to profits RBS is facing as it continues to set aside huge sums for fines and compensation, according to JP Morgan.
In a world of $40 oil,do electric cars have a sunny future…Tesla had a big fall last night after hours on slowing Chinese sales..they could work out how to charge them apparently…
Cancer is fast becoming a major problem for China too…as they race to emulate the West in their living standards, pollution and lifestyle choices are taking their toll…big pharms would be salivating at this prospect…China has the world’s largest number of cancer cases and deaths. If current trends continue, cancer could cost China about $5.6 trillion in lost output from 2012 to 2030 according to some reports……….there are an estimated 3.07 million new cancer cases annually, according to the World Health Organization’s cancer agency. That translates into a diagnosis every ten seconds and 2.2 million deaths from cancer each year.
Ukraine is now the second most likely country to default as its Russian loans look to be called in…who is going to bail them out…the US taxpayer?
Onthehouse Holdings,the real estate software provider has a few activist investors creeping up its register in Sandon Capital, BlueLake Partners and Gannet Capital who together control about 13 per cent of the company.
Santos says it is closely investigating the sale of the Gladstone LNG pipeline in the wake of a $US5 billion ($6.1bn) rival pipeline sale, as it gets in shape to weather a year of $US50 oil and tries to avoid an ¬equity raising….still happy to avoid oils just yet…
Quick summary from www.zerohedge.com
And finally….lying is a sin…
An attractive young woman on a flight from Ireland asked the Priest beside her, ‘Father, may I ask a favour?’
‘Of course child. What may I do for you?’
‘Well, I bought my mother an expensive hair dryer for her birthday.
It is unopened but well over the Customs limits and I’m afraid they’ll confiscate it. Is there any way you could carry it through customs for me?
Hide it under your robes perhaps?’
‘I would love to help you, dear, but I must warn you, I will not lie.’
‘With your honest face, Father, no one will question you.’
When they got to Customs, she let the priest go first. The official asked, ‘Father, do you have anything to declare?’
‘From the top of my head down to my waist I have nothing to declare.’
The official thought this answer strange, so asked, ‘And what do you have to declare from your waist to the floor?’
‘I have a marvelous instrument designed to be used on a woman, but which is, to date, unused.’
Roaring with laughter, the official said, ‘Go ahead, Father. Next please!’
Have a good day….