8 Feb 2013
Company reporting season is underway, the notables to report this week included;
• Telstra (positive)
• National Australia Bank (positive)
• Tabcorp (neutral)
• News Corp (neutral)
Australian and global shares continue to rise given the improving market and economic sentiment and the low rates of return on offer in more defensive investments.
Defensive and higher yielding stocks continue to perform strongly in Australia, though we have also seen the positive market sentiment spread to cyclical and resource stocks, which lagged the market in 2012.
The gold price (in USD terms) has been falling.
Overseas markets are flat to a little lower this week – US (worries on Europe, underwhelming data on US economy), Europe (rates kept on hold, political issues out of Italy and Spain), Asia (largely flat with choppy conditions).
The RBA held off cutting rates at the February meeting, but cited scope to further reduce rates this year. The Australian Dollar has since fallen.
Unemployment rate held steady in January – key to note that the participation rate is still falling (ie. increase in “discouraged job-seekers”).
Australia’s construction sector contracted further in January, marking the industry’s 32nd consecutive month in decline.
National Australia Bank’s quarterly business survey showed both conditions and confidence fell to levels not seen since the first half of 2009.
Retail spending figures from the month of December 2012 were poor.
Gillard announces election date of 14 September, breaking with protocol to announce it well an advance (apparently to put an end to the speculated date….the element of surprise has been forfeited).
2 senior federal Labor members announce they’re not contesting the next election (sighting personal reasons…..really)
Abbott has been unusually quiet of late (makes sense given a lot has been reported out of the Labor camp)
Spanish prime minister allegedly caught in bribery scandal (nothing new)
Berlusconi behind in the polls in the Italy (something to be thankful for)
New Bank of England governor (a Canadian citizen) is presented (paraded) in front of the senate committee for questioning (ie. justifying is largesse salary)
As always if you'd like to discuss this week’s wrap up or your portfolio please feel free to contact your adviser on 02 9324 8888 or email firstname.lastname@example.org with your questions.