The market is up 13 points. The US responded to the news that Larry Summers was withdrawing his candidacy for the Federal Chairman role — we reacted to that yesterday (our market up 28 yesterday). Front runner Janet Yellen was instrumental in introducing quantitative easing and is seen as more dovish than Summers (more likely to tread carefully with tapering) and the most likely to clone the Bernanke chairmanship.
Dow Jones was up 119. It was up 174 at best. S&P 500 was up 10 to 1698.

Syria — The UN has announced that it had firm evidence of the use of chemical weapons in Syria and the consequent death of 1400 people. The UK and US hit an agreement to decommission Syria’s chemical weapons within a year. The oil price fell 1.5%. A$ holding above 93c at 93.22c. The industrial production numbers and the Empire State manufacturing index came in below expectations.

FOMC Meeting starts tonight — two day meeting — the statement will be out 4am Thursday morning our time. Obama spoke — saying he had no intention of negotiating over the debt ceiling. The ECB President Mario Draghi said rates will remain low for “an extended period of time” and that the European recovery “is only in its infancy” and that “unemployment is still far too high.”

BHP was up 0.95% in the US overnight. The stock closed in the US down 22c on the close yesterday. RIO was up 0.52% in the US. Apple down 3.2%. Boeing up 3.9% on a fighter jet deal with Korea.

Gold down up $9. The gold price was down 5.62% last week. US Bonds up again — The US 10 year bond yield down 2 basis points to 2.866%. Iron ore price down 40c to $134.10. European markets up. Germany the best up 1.22%. UK up 0.59%. Metals mostly down small — Copper up 0.64%.

RESULTS & STORIES

  • TPG Telecom (TPM) — Results beat expectations. Guidance was $285-290 million, but it has reported $293.1 million EBITDA. NPAT up 64% to $149.2 million. 4c final dividend. Full year dividend of 7.5c is up 36%. 75,000 subscribers added over the year compared with 47,000 last year. 671,000 broadband subscribers and 360,000 mobile phone customers.
  • Premier Investments (PMV) — Results OK – Underlying financial year net profit $75 million up 1.9% and above an expected $73.9 million. Final dividend 19c. Financial year net profit $174.5 million; more than doubles. EBIT up 4.1% to $83.7 million.
  • New Hope Corporation (NHC) — Financial year profit cut by more than half due to lower prices, high Australian dollar and one-off write-downs. Profit of $74 million down from $167 million. Underlying profit was $125 million down from $171 million. Despite the lower earnings, a 5c final dividend along with a special dividend of a further 5c.
  • Regis Resources (RRL) — Profit of $201 million. Net profit of $145.7 million more than doubles. Final dividend of 15c. Gold output up to 368,000 Oz.
  • The market hit a 5 year high yesterday closing at 5248. Drivers include the federal election, reduced tension in Syria, Summers dropping out of the race for US Federal Reserve chairman and expectations that tapering will be moderate. European markets hitting five year highs as well. German market hit an all-time high.
  • The superannuation industry is happy at the appointment of Arthur Sinodinos as assistant treasurer in charge of superannuation. His appointment suggests that superannuation reform is not a focus of the new government.
  • The minutes of the last RBA Meeting are due out today. It was the pre-election weekend meeting and there was no chance of a rate cut. Although the market was pricing in a 50% chance of another rate cut by year end the recent improvement in housing market activity suggests it is less necessary. At the same time their last meeting declared the A$ as being ‘elevated’ and it has since gone higher.
  • In Europe tonight — ZEW Economic Sentiment, and German ZEW Economic Sentiment, UK CPI, PPI input, and RPI.
  • US economic numbers tonight — CPI & Core CPI, Net Long-Term TIC Flows, NAHB Housing Market Index.
  • Bigger stocks going ex dividend today — MQA (3.3c), SIP (2c).
  • Australian Economics today — Minutes of RBA monthly board meeting, new motor vehicle sales, international merchandise imports.

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Peter Fray
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