Interdum stultus opportuna loquitur...

Monday, September 26, 2005

OzRant: 'Investing' For Dummies...

Note - from June 24th 2009, this blog has migrated from Blogger to a self-hosted version. Click here to go straight there.

Well, let's go through the "I told you so" checklist. Hurricane Rita was sub-100mph by the time she hit land... that's one tick. Oil infrastructure in the region was unscathed... that's two ticks. Crude oil opened this morning and fell below $62.75 briefly before bouncing back to above $63. The neckline for the "head and shoulders" I predicted more than a week ago, is now $62.33; two successive closes below that level points to a near-certain decline to $57-ish.

As I said all last week, all the Chicken Little drivel being printed last week was a complete misdirection. It was almost as big a farce as anything Ariel Sharon says about negotiations regarding a Palestinian state - except of course that Hurricane Rita didn't finish off by firing US-made missiles into schools.

However in our little market, things are getting out of hand; the lunatics are firmly in charge of the asylum, and what is happening currently is a fool's errand. Markets can defy a lack of fundamental investment merit for a while, and can ignore a technical overbought condition for a while, too. However eventually the Piper decides he's sick of waiting to be paid, and sends around the heavies.

Although last week was a great one for selling any overbought levels, today the market made a new high. It's not going much further... I'm retaining a selling bias. Feel free to let me know that you think I'm an idiot for doing so - I will certainly feel free in bragging once the decline is over and the All Ords is 500 points lower.

Major Market Indices

The broad market - the ASX All Ordinaries (XAO) - is all twitterpated by the decline in Crude. It's trying to front-run what people clearly believe will be a euphoric Monday-orgasm relief rally in the US post-Rita. I think it's going to be hugely disappointed.

That didn't stop the euphoria today though: the All Ords rose by 51.30 points (1.14%), finishing at 4565.30 points. The index opened at its low (4514) and closed at its high - clearly there is a prevailing mood that, in the words of the old disco hit by Yazz... "The Only Way Is Up". 

Yazz was an odd-looking peroxided blonde bird... a perfect example of someone whose decisions were based on a short horizon, to be sure, but hardly a model for an 'investment' paradigm.

Total volume traded on the ASX was 1.09 billion units, 2.4% above its 10-day average. Of the 486 stocks in the index, 235 rose while 136 fell. Volume was tilted in favour of the gainers by a margin of just 1.3:1, with 298.31million shares traded in gainers while 237.20million shares traded in the day's losers. Hardly the stuff of such a tilted headline index move.

The Index that forms the cash basis for the SFE's Share Price Index Futures - the S&P/ASX 200 (XJO) - rose by 56.50 points (1.24%), finishing at 4618.90 points.

The "heavy hitters" of the Australian market - the ASX 20 Leaders (XTL) - rose by 35.60 points (1.47%), finishing at 2457.40 points. Within the index members, there were 16 that rose, and only 4 losers. Even Woodside - which is priced for $70 oil when oil is on the way down - rose 2c. Total volume in rising issues within the ASX20 amounted to 57.72m shares while volume in the losers totalled 64.36m units.

The major winners in the "big guns" were -

  • Rio Tinto (RIO), +$1.990 (3.58%) to $57.550 on volume of 3.36m shares;
  • BHP Billiton (BHP), +$0.560 (2.63%) to $21.860 on volume of 12.3m shares;
  • Wesfarmers (WES), +$1.010 (2.61%) to $39.700 on volume of 1.1m shares;
  • Australia And New Zealand Banking Group (ANZ), +$0.530 (2.28%) to $23.740 on volume of 4.01m shares; and
  • St George Bank (SGB), +$0.540 (1.96%) to $28.150 on volume of 1.18m shares.

The following stocks made up the biggest percentage losers in the big-guns:

  • Telstra Corporation (TLS), -$0.19 (4.42%) to $4.11 on volume of 33.28m shares;
  • AMP Limited (AMP), -$0.10 (1.34%) to $7.36 on volume of 18.77m shares; 
  • Alumina (AWC), -$0.06 (0.97%) to $6.10 on volume of 5.44m shares; and
  • Foster's Group (FGL), -$0.02 (0.35%) to $5.72 on volume of 6.88m shares.

At the smaller end of the market's capitalisation scale, the ASX Small Ordinaries Index (XSO) - the only place where underexploited value exists with any regularity - rose by 18.90 points (0.71%), finishing at 2664.40 points. The major winners in the "pop-guns" were -

  • FKP Property Group (FKP), +$0.240 (5.24%) to $4.820 on volume of 391,000 shares;
  • Crane Group (CRG), +$0.480 (4.49%) to $11.180 on volume of 192,000 shares; and
  • Kagara Zinc (KZL), +$0.060 (4.17%) to $1.500 on volume of 1.29m shares; and
  • Zinifex (ZFX), +$0.170 (4.05%) to $4.370 on volume of 3.58m shares; and
  • Macmahon Holdings (MAH), +$0.020 (3.74%) to $0.555 on volume of 6.31m shares.

The losingest-little-guys for the session were (in order of decline):

  • Croesus Mining (CRS), -$0.020 (5.33%) to $0.355 on volume of 2.17m shares;
  • Village Life Ltd (VLL), -$0.025 (5.32%) to $0.445 on volume of 747,000 shares; and
  • Multiemedia (MUL), -$0.001 (5%) to $0.019 on volume of 57.28m shares; and
  • Orbital Corporation (OEC), -$0.005 (4.55%) to $0.105 on volume of 312,000 shares; and
  • Mosaic Oil (MOS), -$0.010 (4.08%) to $0.235 on volume of 2.53m shares.
Index Changes
XAOAll Ordinaries4565.351.31.14%593.49m
XTLS&P/ASX 202457.435.61.47%122.09m
XFLS&P/ASX 504511.2561.26%248.52m
XTOS&P/ASX 1003741.246.81.27%366.68m
XJOS&P/ASX 2004618.956.51.24%451.81m
XKOS&P/ASX 3004612.855.51.22%0
XMDS&P/ASX Mid-Cap 504629.461.11.34%0
XSOS&P/ASX Small Ordinaries2664.418.90.71%190.7m

All Ordinaries Market Internals

Market Breadth
Advancing Volume57.72m210.29m258.73m298.3177.41625.3
Declining Volume64.36m137.87m156.8m237.289.23361.48

S&P/ASX200 GICS Sector Indices

The top sector for the day was XMJ Materials which gained 2.08% to 8686.80 points. The sector was helped by

  • Zinifex (ZFX), +$0.170 (4.05%) to $4.370 on volume of 3.58m shares;
  • Rio Tinto (RIO), +$1.990 (3.58%) to $57.550 on volume of 3.36m shares;
  • Jubilee Mines (JBM), +$0.260 (3.49%) to $7.710 on volume of 700,000 shares;
  • Rinker Group (RIN), +$0.530 (3.43%) to $16.000 on volume of 3.83m shares; and
  • Bluescope Steel (BSL), +$0.300 (3.08%) to $10.050 on volume of 4.41m shares.

Second in the sector leadership stakes was XIJ Information Technology which gained 1.75% to 436.90 points. The sector leaders were -

  • Vision Systems (VSL), +$0.050 (3.46%) to $1.495 on volume of 935,000 shares;
  • ERG (ERG), +$0.005 (2.94%) to $0.175 on volume of 1.54m shares;
  • Computershare (CPU), +$0.170 (2.59%) to $6.740 on volume of 1.48m shares;
  • IRESS Market Technology (IRE), +$0.070 (1.62%) to $4.380 on volume of 106,000 shares; and
  • MYOB (MYO), +$0.010 (0.94%) to $1.070 on volume of 345,000 shares.

The bronze today went to XXJ ASX200 Financials ex Property Trusts which gained 1.56% to 5548.40 points. The sector was led by

  • Macquarie Bank (MBL), +$3.970 (5.67%) to $74.040 on volume of 1.44m shares;
  • FKP Property Group (FKP), +$0.240 (5.24%) to $4.820 on volume of 391,000 shares;
  • Record Investments (RCD), +$0.160 (2.31%) to $7.100 on volume of 416,000 shares;
  • Australia And New Zealand Banking Group (ANZ), +$0.530 (2.28%) to $23.740 on volume of 4.01m shares; and
  • Axa Asia Pacific Holdings (AXA), +$0.100 (2.14%) to $4.780 on volume of 2.37m shares.

The worst-performed sector today was XTJ Telecommunications which lost 3.71% to 1505.90 points, caused solely by Telstra going ex-div. Effectively, there were no declining sectors today.

  • Telstra Corporation (TLS), -$0.190 (4.42%) to $4.110 on volume of 33.28m shares after it went ex-dividend 20c; and
  • Telecom Corporation Of New Zealand (TEL), -$0.020 (0.36%) to $5.490 on volume of 2.42m shares.

Just in front of last place on the sector table was XUJ Utilities which gained 0.13% to 5273.10 points.

Sector Indices
CodeGICS SectorClose+/-%Volume
XIJInformation Technology436.97.51.75%5.1m
XXJASX200 Financials ex Property Trusts5548.485.11.56%72.02m
XSJConsumer Staples5909.772.41.24%24.82m
XDJConsumer Discretionary233415.30.66%35.42m
XPJProperty Trusts1872.711.10.6%71.5m

All Ordinaries Major Movers

All Ords Volume Leaders
TLSTelstra Corporation4.11-0.19-4.42%33.28m
BILBrambles Industries8.930.060.68%21.88m
LHGLihir Gold1.81-0.01-0.55%19.5m
AMPAMP Limited7.36-0.1-1.34%18.77m
BHPBHP Billiton21.860.562.63%12.3m
AGSAlliance Resources0.230.0745.16%12.05m
All Ords Percentage Gainers
IASInternational All Sports0.330.038.33%496879
LEILeighton Holdings150.856.01%1.05m
MBLMacquarie Bank74.043.975.67%1.44m
GDMGoldstream Mining0.380.025.56%145880
UNWUnwired Group0.580.035.45%608324
All Ords Percentage Decliners
IHGIntellect Holdings0.028-0.005-15.15%1.89m
MSTMetal Storm0.27-0.04-11.67%2.42m
COUCount Financial1.68-0.1-5.62%52815
CRSCroesus Mining0.36-0.02-5.33%2.17m
VLLVillage Life Ltd0.45-0.03-5.32%747037

Elsewhere in the Region...

Regional Indices
New ZealandNZSE503412.5674.780.14%18.17m
JapanNikkei 22513392.63233.271.77%0
SingaporeStraits Times2307.2814.240.62%0
Hong KongHang Seng15163.8119.840.13%125m
MalaysiaKLSE Comp925.113.220.35%0