Note - from June 24th 2009, this blog has migrated from Blogger to a self-hosted version. Click here to go straight there.
Today was not nearly as awful as it might have been for the Strayan market - compared to the downdraft which might have eventuated given the NAB and ANZ news (both bad) plus the news that two more small-ish US banks were shuttered over the weekend.
It seems that Strayan investors are pinning their collective hopes on the ability of government intervention to permanently fix the global credit malaise - as if government has ever provided a fix for any problem that confronts society.
Colour me slightly skeptical when it comes to the idea of the US government - or any set of tax-parasites, anywhere - being able to fix the ramifications of the attempt to centrally plan the short end of the interest rate term structure. (That is what is actually meant by 'monetary policy' - it is a government price control over the cost of funds; little surprise then, that the government-set price is almost always wrong).
Let's look at some of the other areas in which government was Here to Help.
Drugs? Folks like getting out of their gourds on occasion, and some Methodists don't like the thought that people anywhere might be having fun. Since people who want to interfere in the lives of others can always find a sympathetic ear amongst politicians, we now have a multi-trillion-dollar War on Drugs which enriches a criminal class and impoverishes the most miserable in society. Despite massive expenditure on interdiction, the street price of hard drugs declines. The rate of opiate addiction in 2007 is almost exactly what it was in 1907... about 1.5%. Well played.
Poverty? The supposed raison d'être for a government is the correction of market failures; chief among these is the provision of public charity (welfare) as a cure to the under-provision of charity in an unfettered market. Income transfers - funded by progressive taxation - are supposed to do the trick. Despite massive increases in the per capita tax take, and the ratio of tax to GDP, inequality has increased and is now at levels previously seen during the so-called Gilded Age of the Robber Barons... i.e., before the rise of the welfare state. Well played.
Communism? We - the taxpayers of the world - funded a pissing contest between two sets of politicians. One set got the idea in their heads that a German fraud from the 19th century was not talking through his hat; they thought that society ought to experiment with State ownership of the means of production. The West decided that no sovereign people had the right to undertake such an experiment, and terror-bombed and invaded anybody who tried to do so - in order to prevent repression, you understand. Trillions of tax dollars later, the ratio of tax to income in most western economies is about 50% and every government is falling over itself to introduce a complete surveillance state. The Beacon of Liberty runs a series of gulags into which its leadership claims the right to disappear its own citizens. Well played.
Terror? After taking it upon themselves to remake the globe as they see fit (with the completely unintended consequence of enriching themselves and their cronies) the western political class interfered in the lives and livelihoods of, and stole or otherwise expropriated the natural resources under, a bunch of folks who finally got fed up with it. They decided to stick it in the eye of the West, using the strategy and tactics of the downtrodden (much as did the Irgun prior to the foundation of the modern racist-supremacist state which calls itself Israel). Thus far the cost has risen to about 3/4 of a trillion dollars, with no end in sight. Well played.
To my way of thinking, the abject failure of these Wars on Choice ought to be no surprise - the political class is made up of people whose only skill is the ability to gain preselection for either of two main political parties. This involves conniving, back-stabbing and manipulation of adherents - and is best achieved by those with a complete absence of principle or scruple. Uppermost in the job requirement is a complete dedication - not to the society, but to The Party. The more loyal you are, the more likely to get a portfolio - often with no relationship whatsoever to your core skills (lying, pandering and cheating). Sounds a lot like a Soviet mindset to me... and is the reason why sociopaths like Dick Cheney and BIll Clinton get to wreak their fell designs, while transferring vast amounts of pelf to themselves and their chums.
Major Market Indices
The broad market - the All Ordinaries (XAO) - declined moderately, dropping 41.1 points (0.82%), finishing at 4989.9 points. The index hit an intraday high of 5032.2 at 10:15 am as a bounce off 5000 was attempted, but that failed pretty miserably. The low for the day was 4957.9 - set at 1:12 pm Sydney time.
The stutter-step climb from there to the close - totalling just under 40 points and taking 100 minutes - represents a rather timid expression of the hope that the US has a bit of a bounce tonight. Although two more US regional banks were shuttered over the weekend, I think that the US is likely to bounce pretty hard after a weak opening (this is a heads-up - there will be a USSpy tonight Oz time, wlmost certainly).
Total volume traded on the ASX was 1 billion units, 25.5% below its 10-day average. The ASX's daily listing of all stocks included 1347 different 3-letter FPO's which traded (i.e., had non-zero trade volume). Of these, 417 issues rose, with volume in rising issues totalling 355.6 million units. On the red side, 624 stocks were losers today, with aggregate volume traded of 545.6 million shares.
Of the 494 All Ordinaries components, 186 rose while 224 fell. Volume was tilted in favour of the losers by a margin of 1.3:1, with 282.17 million shares traded in gainers while 367.45 million shares traded in the day's losers. So all things considered, this was not a particularly gloomy session, breadth wise: low volume, no signs of panic in the advance-decline numbers. Not a volume/breadth blowoff to the downside by any stretch.
The Index that forms the cash basis for the SFE's Share Price Index Futures - the S&P/ASX 200 (XJO) - fell almost a percent, losing 48.4 points (0.97%), closing out the session at 4922.1 points.
| Name | Close | +/-(%) |
|---|---|---|
| All Ordinaries | 4989.90 | -41.10 (0.8%) |
| ASX 50 | 4812.10 | -67.10 (1.4%) |
| ASX 200 | 4922.10 | -48.40 (1.0%) |
| ASX 300 | 4918.30 | -48.00 (1.0%) |
| ASX Mid-Cap 50 | 4872.30 | 19.60 (0.4%) |
| ASX Small Ordinaries | 2860.70 | 14.50 (0.5%) |
| ASX 20 | 2764.00 | -38.80 (1.4%) |
| ASX 100 | 3982.90 | -45.50 (1.1%) |
The "heavy hitters" of the Australian market - the ASX 20 Leaders (XTL) - registered a loss of 38.8 points (1.38%), closing out the session at 2764 points.
Among the 20 big guns, 5 index components finished to the upside, and of the rest, 14 closed lower for the session. The index components traded a total of 196.93 million units with rising volume amounting to 88.26 million shares, while the 14 decliners had volume traded totalling 102.29 million units. The major percentage gainers within the index were
- Rio Tinto Limited (RIO), +$4.84 (4.25%) to $118.64 on volume of 835.9 thousand shares;
- BHP Billiton Limited (BHP), +$1.09 (2.95%) to $38.01 on volume of 9.5 million shares;
- Woolworths Limited (WOW), +$0.60 (2.35%) to $26.14 on volume of 2.8 million shares;
- Telstra Corporation Limited. (TLS), +$0.10 (2.27%) to $4.50 on volume of 69.6 million shares; and
- Westfield Group (WDC), +$0.32 (1.98%) to $16.47 on volume of 5.5 million shares.
On the less salubrious side of the big-cap fence, the following stocks were the worst-performed within the index:
- ANZ Banking Group Limited (ANZ), -$1.67 (9.41%) to $16.08 on volume of 30.4 million shares on news that its loan loss provisions would be higher than expected (DUH!);
- St George Bank Limited (SGB), -$2.3 (8.04%) to $26.31 on volume of 3.4 million shares;
- Westpac Banking Corporation (WBC), -$1.5 (6.79%) to $20.59 on volume of 17.7 million shares;
- Stockland (SGP), -$0.29 (5.77%) to $4.74 on volume of 7.8 million shares; and
- Suncorp-Metway Limited. (SUN), -$0.59 (4.28%) to $13.19 on volume of 3.7 million shares.
Oddly wnough, NAB didn't get hammered despite apparently reporting that as much as 55% of its US mortgage exposure would be written off.
At the other end of the market-cap spectrum lie the denizens of the ASX Small Ordinaries (XSO) - the place where non-mania excess returns lie. The small-fry swam in the opposite direction to the big fish today, consistent with the rotational theme that has been in evidence lo these past weeks.
The big guys got their clock punched while the minnows posted a gain. The Small Ords advanced by half a percent, adding 14.5 points (0.51%), closing out the session at 2860.7 points.
Among the stocks that make up the Small Caps index, 80 index components finished to the upside, and of the rest, 90 closed lower for the session.
The 195 stocks which make up the index traded a total of 202.8 million units: volume in the 80 gainers totalling 97.69 million shares, with trade totalling 78.28 million units in the index's 90 declining components. The major percentage gainers within the index were- Centro Properties Group (CNP), +$0.04 (12.73%) to $0.31 on volume of 24.7 million shares;
- Felix Resources Limited (FLX), +$2.07 (11.77%) to $19.66 on volume of 524.3 thousand shares;
- Straits Resources Limited (SRL), +$0.52 (10.59%) to $5.43 on volume of 1.1 million shares;
- Sunshine Gas Limited (SHG), +$0.17 (9.19%) to $2.02 on volume of 794.4 thousand shares; and
- Great Southern Limited (GTP), +$0.08 (8.72%) to $0.94 on volume of 1.4 million shares.
In the red-zone of the little-stock index, the following list represents the biggest downers (in terms of percentage decline):
- Rubicon Europe Trust Group (REU), -$0.02 (16.67%) to $0.08 on volume of 2.4 million shares;
- Becton Property Group (BEC), -$0.16 (11.55%) to $1.23 on volume of 812.5 thousand shares;
- Albidon Limited (ALB), -$0.29 (10.55%) to $2.46 on volume of 782.3 thousand shares;
- Macquarie DDR Trust (MDT), -$0.03 (9.26%) to $0.25 on volume of 4.6 million shares; and
- Minara Resources Limited (MRE), -$0.18 (9.09%) to $1.75 on volume of 3.7 million shares.
Index Changes
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| XAO | All Ordinaries | 4989.9 | -41.1 | -0.82 | 690.8m |
| XFL | ASX 50 | 4812.1 | -67.1 | -1.38 | 350m |
| XJO | ASX 200 | 4922.1 | -48.4 | -0.97 | 612.1m |
| XKO | ASX 300 | 4918.3 | -48 | -0.97 | 661.2m |
| XMD | ASX Mid-Cap 50 | 4872.3 | 19.6 | 0.4 | 108.4m |
| XSO | ASX Small Ordinaries | 2860.7 | 14.5 | 0.51 | 202.8m |
| XTL | ASX 20 | 2764 | -38.8 | -1.38 | 196.9m |
| XTO | ASX 100 | 3982.9 | -45.5 | -1.13 | 458.4m |
Market Breadth
| ASX20 | XTO | XJO | XAO | XSO | Market | |
|---|---|---|---|---|---|---|
| Advances | 5 | 38 | 87 | 186 | 80 | 417 |
| Declines | 14 | 62 | 103 | 224 | 90 | 624 |
| Advancing Volume | 88.3m | 172.1m | 257.4m | 282.2m | 97.7m | 355.6 million |
| Declining Volume | 102.3m | 279.9m | 329.4m | 367.5m | 78.3m | 545.6 million |
GICS Industry Indices
Among the 11 industry indices, it was pretty much even stevens, with a very slight lead to the duds... the 5 that had an "up" day were just shaded by the remaining 6 which didn't.
The best performing index was Information Technology (XIJ), which added 15 points (3.06%) to 505.2 points. The 2 stocks which make up the index traded a total of 1.16 million units; both rose.
- Computershare Limited (CPU), +$0.27 (3.15%) to $8.83 on volume of 953.1 thousand shares; and
- Iress Market Technology Limited (IRE), +$0.08 (1.32%) to $6.12 on volume of 207.3 thousand shares.
Second in the index leadership stakes was Telecommunications (XTJ), which gained 33.3 points (2.21%) to 1542.5 points. The 3 stocks which make up the index traded a total of 72.59 million units; 2 index components rose, with rising volume amounting to 71.7 million shares -
- Telecom Corporation Of New Zealand Limited (TEL), +$0.07 (2.55%) to $2.81 on volume of 2.1 million shares; and
- Telstra Corporation Limited. (TLS), +$0.10 (2.27%) to $4.50 on volume of 69.6 million shares.
The bronze medal for today goes to Materials (XMJ), which climbed 235.2 points (1.77%) to 13520.6 points. The 42 stocks which make up the index traded a total of 120.2 million units; 21 index components rose, with rising volume amounting to 52.47 million shares, while the 18 decliners had volume traded totalling 52.62 million units. The major percentage gainers within the index were
- Straits Resources Limited (SRL), +$0.52 (10.59%) to $5.43 on volume of 1.1 million shares;
- Great Southern Limited (GTP), +$0.08 (8.72%) to $0.94 on volume of 1.4 million shares;
- PanAust Ltd (PNA), +$0.06 (7.24%) to $0.82 on volume of 5.1 million shares;
- Iluka Resources Limited (ILU), +$0.30 (6.91%) to $4.64 on volume of 1.5 million shares; and
- Platinum Australia Limited (PLA), +$0.12 (5.24%) to $2.41 on volume of 582.3 thousand shares.
The worst-performed index for the session was Financials ex Property Trusts (XXJ), which dipped 241.2 points (4.76%) to 4824.1 points. The 30 stocks which make up the index traded a total of 109.38 million units; The 18 decliners had volume traded totalling 94.13 million units, and 9 index components rose, with rising volume amounting to 13.65 million shares, The major percentage decliners within the index were
- ANZ Banking Group Limited (ANZ), -$1.67 (9.41%) to $16.08 on volume of 30.4 million shares;
- St George Bank Limited (SGB), -$2.3 (8.04%) to $26.31 on volume of 3.4 million shares;
- Challenger Financial Services Group Limited (CGF), -$0.19 (7.76%) to $2.26 on volume of 2.8 million shares;
- Westpac Banking Corporation (WBC), -$1.5 (6.79%) to $20.59 on volume of 17.7 million shares; and
- Babcock & Brown Limited (BNB), -$0.47 (6.66%) to $6.59 on volume of 2.9 million shares.
Just missing out on the wooden spoon was Consumer Discretionary (XDJ), which slid 23.8 points (1.45%) to 1616.8 points. The 25 stocks which make up the index traded a total of 37.6 million units; The 17 decliners had volume traded totalling 31.9 million units, and 8 index components rose, with rising volume amounting to 5.7 million shares, The major percentage decliners within the index were
- West Australian Newspapers Holdings Limited (WAN), -$0.55 (6.04%) to $8.56 on volume of 548.3 thousand shares;
- Wotif.com Holdings Limited (WTF), -$0.16 (4.85%) to $3.14 on volume of 675.8 thousand shares;
- Fairfax Media Limited (FXJ), -$0.12 (4.08%) to $2.82 on volume of 7.4 million shares;
- Macquarie Communications Infrastructure Group (MCG), -$0.12 (3.72%) to $3.11 on volume of 1.6 million shares; and
- Seven Network Limited (SEV), -$0.2 (2.58%) to $7.54 on volume of 379.4 thousand shares.
Third-to-last amongst the sector indices was Healthcare (XHJ), which slid 105.1 points (1.26%) to 8234.4 points. The 8 stocks which make up the index traded a total of 8.33 million units; The 4 decliners had volume traded totalling 3.19 million units, and 3 index components rose, with rising volume amounting to 4.91 million shares, The major percentage decliners within the index were
- Ansell Limited (ANN), -$0.24 (2.39%) to $9.80 on volume of 600 thousand shares;
- CSL Limited (CSL), -$0.67 (1.91%) to $34.40 on volume of 1.7 million shares;
- Healthscope Limited (HSP), -$0.08 (1.77%) to $4.44 on volume of 620.5 thousand shares; and
- Cochlear Limited (COH), -$0.75 (1.63%) to $45.20 on volume of 217.1 thousand shares.
Sector Indices
| Code | GICS Sector | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| XIJ | Information Technology | 505.2 | 15 | 3.06 | 1m |
| XTJ | Telecommunications | 1542.5 | 33.3 | 2.21 | 73m |
| XMJ | Materials | 13520.6 | 235.2 | 1.77 | 120m |
| XUJ | Utilities | 5513.9 | 76.3 | 1.4 | 16m |
| XSJ | Consumer Staples | 7177.7 | 54.5 | 0.77 | 25m |
| XPJ | Property Trusts | 1352.1 | -5 | -0.37 | 107m |
| XEJ | Energy | 16584.6 | -129.8 | -0.78 | 45m |
| XNJ | Industrials | 4737.8 | -58.9 | -1.23 | 70m |
| XHJ | Healthcare | 8234.4 | -105.1 | -1.26 | 8m |
| XDJ | Consumer Discretionary | 1616.8 | -23.8 | -1.45 | 38m |
| XXJ | Financials ex Property Trusts | 4824.1 | -241.2 | -4.76 | 109m |
All Ordinaries Major Movers
All Ords Volume Leaders
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| TLS | Telstra Corporation Limited. | 4.50 | 0.10 | 2.27 | 69.6m |
| ANZ | Australia And New Zealand Banking Group Limited | 16.08 | -1.67 | -9.41 | 30.4m |
| CNP | Centro Properties Group | 0.31 | 0.04 | 12.73 | 24.7m |
| WBC | Westpac Banking Corporation | 20.59 | -1.50 | -6.79 | 17.7m |
| MIG | Macquarie Infrastructure Group | 2.56 | -0.09 | -3.4 | 17.5m |
All Ords Percentage Gainers
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| TWO | Talent2 International Limited | 1.50 | 0.24 | 19.05 | 180.2k |
| CNP | Centro Properties Group | 0.31 | 0.04 | 12.73 | 24.7m |
| FLX | Felix Resources Limited | 19.66 | 2.07 | 11.77 | 524.3k |
| SRL | Straits Resources Limited | 5.43 | 0.52 | 10.59 | 1.1m |
| MOC | Mortgage Choice Limited | 0.97 | 0.09 | 10.23 | 373k |
All Ords Percentage Losers
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| ORI | Orica Limited | 22.79 | -4.68 | -17.04 | 4.1m |
| REU | Rubicon Europe Trust Group | 0.08 | -0.02 | -16.67 | 2.4m |
| MUE | Multiplex European Property Fund | 0.47 | -0.08 | -14.55 | 386.3k |
| AXQ | Allco Max Securities And Mortgage Trust | 0.13 | -0.02 | -13.33 | 89k |
| BEC | Becton Property Group | 1.23 | -0.16 | -11.55 | 812.5k |
