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ASX 200 closes up 45.3 to 5669.5.Four straight days of gains. China tip toes ahead. Resources /Energy the highlight.US Futures down 8.Rest day tomorrow?
July could be the best month since February. If we hold tomorrow.
Another strong day, on low volume at $4.7bn, led by the miners as the price of iron ore enters a new bull market. Seems only yesterday that we were in a bear market. Maybe someone needs to change the technical definition now to take into account the increased volatility. BHP +2.36 % and RIO + 2.36% bounding ahead but Fortescue Mining (FMG) + 0.8% suffering some profit taking following extraordinary gains in the last few days. The rise of the iron ore price does look linked to the recovery of the Chinese stock market, as they use everything they can to borrow against, and iron ore is no exception. Margin calls in equities hurt commodities too. Seems this is why the price has bounced so much. In speculative iron ore stocks Atlas Iron (AGO) +6.06% rallied hard on percentage terms but no real cause for optimism for long suffering shareholders.
Sentiment was positive after the Fed meeting last night suggested that all was on track for a rate rise this year. Although as usual the language was obfuscated, the clear picture is investors and traders have been warned. Rates will rise, get used to it and plan for it. September or December but definitely 2015.
Strong jump on the opening and never looked back
Financials were strong as you would expect with National Bank (NAB) +1.14 % the stand out along with AMP + 1.84 % following its move yesterday to lift rates on loans on property investors. REITS were mixed with once again Westfield Corp (WFD) +0.5 % the best. Goodman Group (GMG) -0.77 % the worst.
Energy stock were also firm with our stock recommendation Karoon Gas (KAR) + 8.29 % doing especially well. Woodside (WPL) +2.09 % , Santos (STO) + 4.21% and Oilsearch (OSH) +2.19 %.
Industrials were green across the screen with Woolworths (WOW) + 2.91 % and Wesfarmers (WES) + 1.56% standing out as were utility stocks like APA +2.05 %,AGL + 1.88% and Spark Infrastructure (SKI) +2.7 %.
First cab off the reporting rank, GUD + 10.87% announced great results this morning as they kicked off the season to be jolly.
Remember that a good result tends to keep the momentum going
This has been a classic cost out story but now they have something to celebrate. The Oster Blender (RRP US999.00) seems to be the big driver in the profit result in the Sunbeam Kitchen appliance business. This was the result of the JV with US Based giant Jarden which bought 49% of the Sunbeam business. The company posted a 2014/15 net profit of $33.2 million on Thursday, up 88 per cent from the prior year’s $17.7 million result. Sales across the group’s commercial and industrial products rose three per cent to a record $612 million in the year to June 30. Lower freight, logistic and warranty costs also contributed to the profit growth.
RRP 999.00 !
OceanaGold Corp (OGC) went into a trading halt today pending news on a ‘possible business combination’. Looks like the M&A activity is increasing in this space. Alacer Gold (AQG) -0.71% was in the spotlight yesterday and OcenaGold has themselves been on a buying spree recently picking up Waihi in April and buying 15% of Gold Standard Ventures earlier this year.
In more good results Freelancer (FLN) +12.88 % delivered a record result with accelerating growth in revenue and gross payments. They announced a 41% increase in net revenue on the prior corresponding period to $16.8 million plus Gross Payment Volume in 1H15 grew strongly to $64.1 million ,up 30% on the prior corresponding period.
Quickflix (QFX) in a trading halt pending an announcement regarding a possible acquisition with an international party.
Cash Converters (CCV) – 1.41%,before a trading halt, are just finding clean air following a recent $23m settlement when today they have been hit with a fresh claim for allegedly charging customers interest rates of up to 160 per cent in Queensland in addition to brokerage fees, despite the legal limit being set at 48 per cent per annum for consumer credit contracts.
In big movers today, unloved Unilife (UNS) + 35.6 % returned to the winners’ enclosure on news of a financing deal with US institutional investor, Lincoln Park Capital Fund and another facility with Cantor Fitzgerald. The company has signed an agreement providing up to $45m with one and $25m with the other.
In economic news today Building approvals have suffered their largest setback since September 2014 as the huge surge in high density dwellings eases. Approvals for the construction of new homes fell 8.2 per cent in June, way worse than market expectations of a 0.9 per cent fall. Over the 12 months to June, building approvals were up 8.6 per cent, the Australian Bureau of Statistics said on Thursday.
Australia’s terms of trade fell another 6 per cent in the last quarter, while export prices fell another 4.4 per cent and import prices rose 1.4 per cent.
Last night in the US facebook posted their latest results. Big numbers for this behemoth. Seems not that long ago the IPO flopped and the stock was trading at $20. Now $97!
Sales rose 39 percent to $4.04 billion this quarter. Messenger has 700 million users, more than double the size of Twitter Inc., WhatsApp has 800 million and Instagram has more than 300 million.
Meanwhile in Asia, Samsung announced its fifth straight profit decline as sales of its flagship S6 failed to come through as expected. Looks like price cuts to come as it struggles to compete with the ubiquitous iPhone. Operating profit at the mobile phone unit slumped to 2.76 trillion won from 4.42 trillion won a year earlier. The consumer-electronics division, which oversees TVs and home appliances, posted a 210 billion-won profit in the quarter from 770 billion won a year earlier. Net income, excluding minority interests, fell to 5.63 trillion won ($4.9 billion) in the three months ended June, missing the 6 trillion-won average of estimates. The shares fell around 3.1% on the back of these numbers. Samsung has more employees than Apple, Google, and Microsoft combined at nearly 500,000 employees!
In Asian markets China was positively boring in our session. A miniscule trading range of only 80 points from 3831 to 3749.A eerily quiet seems to have descended on the Shanghai market. As the huge margin debt position is unwinding fast.
And as we closed they are up1.12%. Japan up 1.03%, Hang Seng up 0.18%and Korea down 2.41% on the Samsung results.