Interdum stultus opportuna loquitur...

Tuesday, November 15, 2005

OzRant: Nice Going, Manuel...

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

As you will see if you examine the post below this one (" Finally, I Get My Way") you will notice that I've moved to a selling bias for US equity indices; I have deliberately not said anything regarding the bias for the Australian markets (because it would annoy the SPISpy community - and you wouldn't like them folks if you saw them annoyed).

Obviously you can infer plenty about the Australian market from the trend condition of the US market, but be aware that the mapping is absolutely not one-to-one. Tomorrow I plan to give everyone a bit of a go at the "full works" (20 people at a time, no crowding, don't touch that it's an important part of the GLAYvin...) - but it relies on my getting some things done today and tomorrow morning.

Anyhow - some interesting things today, both of which ran coutner to prior Rant views...

Telstra got smacked (and how) after Ziggy Lite (Sol "Manuel fron Barthelona" Trujillo) laid out his strategic vision - which as you can see, the market just loved... 

Seriously though: how hard would it have been - during the reign of Ziggy Bulldust - to imagine a worse performer than the Ziggster? And yet there it is!

To add insult to injury, even Woodside went on a bit of a gallop. Everyone smells a low in Crude prices.

Overall the market went nowhere.

I keep getting back to the housing market as the thing that eventually unzips the whole enchilada; very little attention has been given to the metastatizing cancer of bad debts that will be accumulating as a reuslt of 'house as ATM' refinancing. I've said it before: when this is over, the term 'EquityMate' will go down in economic history as equally-despicable beside 'VEDC' and 'Pyramid building Society'. Chuck in 'DavNet', 'HIH' and 'One.Tel' while you're at it, and you get some indication of the eventual size of the problem.

See, folks took out about a bazillion dollars of home equity - at a top - and spent it on other, overpriced property; overpriced improvements to overpriced property; cars; holidays; and general living expenses.

Now colour me shocked, but if a mortgagee is drawing down on their capital in order to fund groceries and phone bills, then something is highly askew.

Usually I would be dismissive of anything that appeared on the Ray Show or the Naomi Show, but frankly we could afford to be a little shit-scared of the eventual ramifications of the massive increase in mortgage commitments (especially since we appear to be in a rising-yield environment). Whn debt-servicing nears a record high (as a proportion of post-tax wages) at a time when interest rates are at 20-year lows, then someone's overextended... but for the moment everyone's ignoring that issue in the hope that somehow we finagle a way out of it (hint: trying to disturb the industrial-relations balance against labour, is not the way to fix it... not even close).

Major Market Indices

The broad market - the ASX All Ordinaries (XAO) - fell by 2.90 points (-0.06%), finishing at 4544.90 points. The index hit an intraday high of 4553.60and its low was 4539.2.

Total volume traded on the ASX was 970 million units, 1.9% below its 10-day average, and a bit softer than yesterday. Of the 487 stocks in the All Ords, 146 rose while 129 fell. Volume was tilted in favour of the losers by a margin of 1.5:1 (thanks largely to the big volume decline in Telstra), with 357.95million shares traded in losers (160 million of which was TLS) while 234.41million shares traded in the day's gainers ..

The Index that forms the cash basis for the SFE's Share Price Index Futures - the S&P/ASX 200 (XJO) - fell by 5.20 points (-0.11%), finishing at 4603.20 points.

The "heavy hitters" of the Australian market - the ASX 20 Leaders (XTL) - fell by 3.80 points (-0.15%), finishing at 2484.50 points. Within the index members, there were 10 that rose, and 10 losers. Total volume in rising issues within the ASX20 amounted to 46.8 while volume in the losers totalled 197.77m units.

The major winners in the "big guns" were -

  • Woodside Petroleum (WPL), +$0.650 (2.06%) to $32.250 on volume of 2.09m shares;
  • St George Bank (SGB), +$0.340 (1.19%) to $28.990 on volume of 2.1m shares;
  • Commonwealth Bank Of Australia (CBA), +$0.440 (1.07%) to $41.590 on volume of 3.04m shares;
  • Westpac Banking Corporation (WBC), +$0.220 (0.99%) to $22.540 on volume of 6.9m shares; and
  • AMP Limited (AMP), +$0.070 (0.95%) to $7.470 on volume of 6.67m shares.

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

  • Telstra Corporation (TLS), -$0.300 (6.94%) to $4.020 on volume of 163.87m shares;
  • Macquarie Bank (MBL), -$1.40 (2%) to $68.50 on volume of 1.69m shares;
  • Alumina (AWC), -$0.07 (1.09%) to $6.33 on volume of 3.13m shares;
  • Woolworths (WOW), -$0.11 (0.64%) to $17.17 on volume of 3.4m shares;
  • Wesfarmers (WES), -$0.21 (0.57%) to $36.89 on volume of 1.72m shares.

At the smaller end of the market's capitalisation scale, the ASX Small Ordinaries Index (XSO) rose by 8.50 points (0.33%), finishing at 2558.20 points. The major winners in the "pop-guns" were -

  • Lynas Corporation (LYC), +$0.020 (16.67%) to $0.140 on volume of 355,000 shares;
  • Kagara Zinc (KZL), +$0.140 (8.95%) to $1.705 on volume of 1.25m shares; and
  • Psivida (PSD), +$0.045 (6.43%) to $0.745 on volume of 723,000 shares; and
  • Mosaic Oil (MOS), +$0.010 (5.41%) to $0.195 on volume of 989,000 shares; and
  • Village Roadshow (VRLPA), +$0.110 (5%) to $2.310 on volume of 702,000 shares.

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

  • Progen Industries (PGL), -$0.270 (8.52%) to $2.900 on volume of 185,000 shares;
  • Clough (CLO), -$0.025 (6.17%) to $0.380 on volume of 171,000 shares; and
  • Mcpherson's (MCP), -$0.150 (5.88%) to $2.400 on volume of 83,000 shares; and
  • Village Life Ltd (VLL), -$0.020 (5.33%) to $0.355 on volume of 402,000 shares; and
  • Miller's Retail (MRL), -$0.050 (4.72%) to $1.010 on volume of 774,000 shares.
Index Changes
XAOAll Ordinaries4544.9-2.9-0.06%673.4m
XTLS&P/ASX 202484.5-3.8-0.15%0
XFLS&P/ASX 504518.8-8.1-0.18%349.48m
XTOS&P/ASX 1003740-5.8-0.15%512.28m
XJOS&P/ASX 2004603.2-5.2-0.11%554.96m
XKOS&P/ASX 3004594.2-5.1-0.11%0
XMDS&P/ASX Mid-Cap 504572.3-0.6-0.01%0
XSOS&P/ASX Small Ordinaries2558.28.50.33%131.76m

All Ordinaries Market Internals

Market Breadth
Advancing Volume46.8m169.87m199.57m234.41m40.89m550.68m
Declining Volume197.77m308.68m336.8m357.95m42.29m326.5m

S&P/ASX200 GICS Sector Indices

The top sector for the day was XEJ Energy which gained 1.17% to 9909.20 points. The sector was helped by

  • Arc Energy (ARQ), +$0.065 (3.8%) to $1.775 on volume of 851,000 shares;
  • Woodside Petroleum (WPL), +$0.650 (2.06%) to $32.250 on volume of 2.09m shares;
  • Tap Oil (TAP), +$0.050 (2%) to $2.550 on volume of 498,000 shares;
  • Roc Oil Company (ROC), +$0.040 (1.64%) to $2.480 on volume of 548,000 shares; and
  • Oil Search (OSH), +$0.030 (0.95%) to $3.200 on volume of 7.21m shares.

Second in the sector leadership stakes was XXJ ASX200 Financials ex Property Trusts which gained 0.46% to 5691.50 points. The sector leaders were -

  • Challenger Financial Services Group (CGF), +$0.090 (2.38%) to $3.870 on volume of 746,000 shares;
  • Adelaide Bank (ADB), +$0.230 (1.83%) to $12.770 on volume of 265,000 shares;
  • Australian Stock Exchange (ASX), +$0.560 (1.82%) to $31.400 on volume of 313,000 shares;
  • Bank Of Queensland (BOQ), +$0.240 (1.75%) to $13.940 on volume of 256,000 shares; and
  • Record Investments (RCD), +$0.100 (1.28%) to $7.900 on volume of 334,000 shares.

The bronze today went toXFJ Financials which gained 0.37% to 5500.00 points. The sector was led by

  • Bunnings Warehouse Property Trust (BWP), +$0.060 (2.93%) to $2.110 on volume of 629,000 shares;
  • Challenger Financial Services Group (CGF), +$0.090 (2.38%) to $3.870 on volume of 746,000 shares;
  • Adelaide Bank (ADB), +$0.230 (1.83%) to $12.770 on volume of 265,000 shares;
  • Australian Stock Exchange (ASX), +$0.560 (1.82%) to $31.400 on volume of 313,000 shares; and
  • Bank Of Queensland (BOQ), +$0.240 (1.75%) to $13.940 on volume of 256,000 shares.

The worst-performed sector today was XTJ Telecommunications which lost 5.47% to 1483.20 points. The sector was dragged lower by

  • Telstra Corporation (TLS), -$0.300 (6.94%) to $4.020 on volume of 163.87m shares; and
  • Telecom Corporation Of New Zealand (TEL), +$0.090 (1.64%) to $5.580 on volume of 3.26m shares.

How's this for a recipe for disaster - let Trujillo say something stupid every day.

I said it when the guy was appointed - he is another George Trumbull (or whatever that AMP Yank-import-failure's name was) - an overpriced import who thinks he can bullshit his way through his tenure (at least until the break-clause period is finished), collect his $150k a month (plus expenses and stock) and then bugger off at the end of the day - laughing. In short, these folks think that the Australian market is full of rubes.

Tell you what though - Telstra still generates massive positive cash flow from operations, and even Manuel fron Barthelona is unable to seriously dent that. Of course instos want the price as low as possible in the leadup to TIII, so that Mums and Dads ignore it (like they ognored the later tranches of Commonwealth Bank).

Just in front of last place on the sector table was XIJ Information Technology which lost 1.41% to 441.20 points. The sector was pulled down by

  • Infomedia Ltd (IFM), -$0.010 (1.83%) to $0.535 on volume of 265,000 shares;
  • Computershare (CPU), -$0.110 (1.6%) to $6.750 on volume of 1.21m shares;
  • Baycorp Advantage (BCA), -$0.050 (1.49%) to $3.300 on volume of 269,000 shares;
  • Vision Systems (VSL), -$0.000 (0%) to $1.710 on volume of 286,000 shares; and
  • ERG (ERG), -$0.000 (0%) to $0.130 on volume of 1.04m shares.
Sector Indices
CodeGICS SectorClose+/-%Volume
XXJASX200 Financials ex Property Trusts5691.5260.46%50.38m
XPJProperty Trusts1855.10.60.03%116.87m
XDJConsumer Discretionary2223.3-4.8-0.22%26.29m
XSJConsumer Staples5940.2-20.5-0.34%34.95m
XIJInformation Technology441.2-6.3-1.41%3.44m

All Ordinaries Major Movers

All Ords Volume Leaders
TLSTelstra Corporation4.02-0.3-6.94%163.87m
CPACommonwealth Property Office Fund1.220.010.83%40.74m
DRTDB Rreef Trust1.370.021.49%17.1m
BTABiota Holdings1.830.010.55%16.57m
MIGMacquarie Infrastructure Group3.61-0.06-1.63%16.21m
BHPBHP Billiton21.53-0.07-0.32%14.67m
All Ords Percentage Gainers
VRLVillage Roadshow2.670.3113.14%899690
DOMDominion Mining0.680.0710.66%755800
KZLKagara Zinc1.710.148.95%1.25m
All Ords Percentage Decliners
SPLStarpharma Holdings0.52-0.07-11.11%724904
PGLProgen Industries2.9-0.27-8.52%185096
TLSTelstra Corporation4.02-0.3-6.94%163.87m

Elsewhere in the Region...

Regional Indices
New ZealandNZSE503311.65227.210.83%28m
JapanNikkei 22514091.81-24.23-0.17%0
SingaporeStraits Times2235.78-18.37-0.81%0
Hong KongHang Seng14644.7215.230.1%140.89m
MalaysiaKLSE Comp895.83-0.36-0.04%0