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31 May 2013 (AFR) – Capex falls sharply, planned spending grows

(31 May 2013, AFR, p8, Jacob Greber Economics correspondent) ‘Companies modestly upgraded investment forecasts for the next financial year, but economists warned much of the increase was being driven by resource project cost blowouts, adding to doubts about drivers of national economic growth.’ ‘The Australian Bureau of Statistics’ heavily anticipated quarterly capex report showed overall investment … Continue reading

31 May 2013 (AFR) – A lower dollar can’t fix all that’s broken

(31 May 2013, AFR, p2, Jennifer Hewett) ‘It’s official. The Australian Bureau of Statistics figures showing a 4.7 per cent fall in private business investment in the March quarter only confirmed the daily company rhetoric about the need to cut costs and put new projects on ice.’ ‘That sort of talk has been loudest of late … Continue reading

31 May 2013 (The Age) – No brakes on high-speed trades: ASIC

(31 May 2013, The ge, BusinessDay, p25, Gareth Hutchens) ‘The corporate regulator says it will not put the brakes on high-speed traders by forcing brokers to hold small trades for a ”minimum resting time”. The chairman of the Australian Securities and Investments Commission, Greg Medcraft, said the proportion of super-small trades on the Australian Securities … Continue reading

31 May 2013 (The Age) – Capex slide signals end of mining boom

(31 May 2013, The Age, BusinessDay, p21, Glenda Kwek) ‘The mining investment boom is in its final days, but economists say there is still strength in the Australian economy with business spending expectations remaining upbeat.’ ‘While private capital expenditure for the March quarter was weaker than expected, Bureau of Statistics figures showed stronger spending expectations … Continue reading

30 May 2013 (AFR) – Developers bank on investors to stave off Melbourne apartment glut

(30 May 2013, AFR, p46, Rebecca Thistleton) ‘More than 35,700 units are in Melbourne’s apartment pipeline, after another 27 projects were brought to market in the March quarter. There are about 290 active apartment projects across Melbourne and 22,850 units are under construction, according to Oliver Hume research. While there have been concerns of an … Continue reading

30 May 2013 (AFR) – World Trade Centre struggles to sign up office tenants

[COMMENT: Normally, according to Phil Anderson (EIS Indicators), the series of “world’s tallest…” and the “world’s biggest…” occur at the end of the economic cycle and into the major down turns. But give that the GFC struck 5 years ago, the news in this article below is rather concering. Read on…] (30 May 2013, AFR, … Continue reading

30 May 2013 (AFR) – US figures point to more buoyant outlook and QE easing

(30 May 2013, AFR, p16, Ben Potter) ‘New housing and confidence data have painted a picture of a steadily improving US economy – raising the prospect that the Federal Reserve could taper its bond buying sooner rather than later.’ ‘The data – which contrasts with sluggish manufacturing figures and subdued jobs’ growth – adds weight … Continue reading

30 May 2013 (AFR) – Growth hit by mining boom end

(30 May 2013, AFR, p1, Jacob Greber Economics correspondent) ‘The OECD has for the first time cast serious doubt about ­Australia’s future after the resources boom, joining the growing fears among experts about how to manage the ­economic ­transition. In an unusually blunt report, the ­Paris-based group forecast ­below-average growth this year and acknowledged the … Continue reading

29 May 2013 (The Age) – Exports signal a new mining phase

(29 May 2013, The Age, BusinessDay, p23, Tim Colebatch) ‘Australia is entering stage 3 of the resources boom. Mineral exports soared 11 per cent in the March quarter, whereas imports of specialised construction machinery used for mining investment plummeted. The Australian Bureau of Statistics reported a $5.6 billion lift in Australia’s trade balance in the … Continue reading

29 May 2013 (TheAge) – Harsh truth about managed funds

[COMMENT: This article is compulsive reading for anyone looking at investing in managed funds. I would love to reproduce the entire article here, but I can’t do that (for ethical reasons), so see the link to The Age article at the bottom…] (29 May 2013, The Age, MONEY, p4, Clancy Yeates) ‘Here’s something many fund … Continue reading

29 May 2013 (AFR) – Banks winning fight against high-frequency traders

(29 May 2013, AFR, p13, Stephen Shore) ‘High-frequency traders now account for less than half the trades on American exchanges, down from an estimated 70 per cent at its peak in 2009, because algorithms developed by investment banks have made it harder for super-fast traders to make money, the global head of Citigroup’s algorithmic products, Young … Continue reading

29 May 2013 (AFR) – Time for personal, private interests to take some pain: Garnaut

(29 May 2013, AFR, p8, Jacob Greber) ‘Australia’s two decades of economic prosperity, which may be unprecedented in any developed nation’s history, has entrenched a political culture ill-equipped to cope with a coming post-boom downturn, according to ­prominent economist Ross Garnaut. In a broad criticism of politicians, interest groups and the expectations of voters, Professor … Continue reading

28 May 2013 (AFR) – Office markets flag as mining services falter

[COMMENT: WARNING! – Watch out for the flow-on effects of closures and slow-downs…] (28 May 2013, AFR, p38, Nick Lenaghan) ‘The faltering resources boom could eventually flow through to office landlords as mining services firms wind back their footprints in Perth and Brisbane especially, according to Morgan Stanley analysts.’ ‘If that forecast is correct, it … Continue reading

28 May 2013 (AFR) – ALS boosts profits, but foresees pain for mining services

[COMMENT: Mining services…. is this a sign of what’s to come?… more problems with mining services as miners scale back on production…. Will retail investors now blindly more stock because it’s cheap? (even though the stocks could get much cheaper from here…). Read the articles…] (28 May 2013, AFR, p22, Luke Forrestal) ‘The head of … Continue reading

28 May 2013 (AFR) – More Australians miss mortgage repayments

(28 May 2013, AFR, p19, George Liondis) ‘A greater number of Australians are missing home loan repayments, despite interest rate cuts. New figures from credit ratings agency Moody’s Investors Service show just under 1.7 per cent of Australian home loan borrowers were behind on repayments at the end of March. That figure was low by … Continue reading

27 May 2013 (AFR) – Shareholder confidence has dropped 6.7 points since February

(27 May 2013, AFR, p26, Sally Rose) ‘Australian retail shareholders reported a significant drop in confidence in May and look set to remain cautious over the coming months. The latest GPS­Melbourne Institute shareholder ­confidence survey to be released on Monday shows local equities investors are expecting lower returns, increased volatility and are less inclined to … Continue reading

25 May 2013 (AFR) – Swan song for collapsed cleaning company

(25 May 2013, AFR, p2, Matthew Drummond) ‘The federal government may have promised $50 million in assistance to employees and business affected by Ford’s decision to close its factories, but there is no help for hundreds of people owed unpaid wages by collapsed ­cleaning firm, Swan Services.’ ‘Almost 2500 people worked for Swan – which cleans … Continue reading

25 May 2013 (AFR) – Markets in turmoil as dollar falls

(25 May 2013, AFR, p1, Vesna Poljak, Jason Murphy and Leng Yeow) ‘Australian shares suffered their worst week in a year, wiping $55 billion off stocks as a combination of fears over the future of central bank stimulus, weak Chinese output and the plunging currency sent chills through the ­market. The S&P/ASX 200 closed at … Continue reading

24 May 2013 (AFR) – China data, Bernanke speech chop 2 per cent off ASX

(24 May 2013, AFR, p21, Leng Yeow) ‘The Australian sharemarket suffered its worst one-day fall since March, dropping 2 per cent on Thursday on the back of data showing manufacturing conditions in China plunging to a seven-month low. Investor sentiment also took a heavy hit after comments by US Federal Reserve chairman Ben Bernanke suggested quantitative … Continue reading

24 May 2013 (AFR) – Ford closure a ‘major blow’ to suppliers

[COMMENT: Flow-on effects from company closures and retrenchments…] (24 May 2013, AFR, p11, Claire Stewart) ‘Suppliers to the car makers will be hardest hit by Ford Motor Company of Australia’s closure and some experts believe the number will need to halve to strip out excess capacity and wasted subsidies.’ ‘A Reserve Bank of Australia analysis … Continue reading

24 May 2013 (AFR) – Global markets retreat on US, China concerns

(24 May 2013, AFR, p1, Vesna Poljak and John Kehoe) ‘The sharemarket suffered its worst one-day fall since March after the United States Federal Reserve hinted at pulling back its massive bond ­purchases as soon as this year and­ ­Chinese manufacturing was unexpectedly weak.’ ‘About $28 billion was wiped off ­Australian shares and the currency … Continue reading

24 May 2013 (AFR) – High costs crash Ford

(24 May 2013, AFR, p1, Phillip Coorey and Mark Skulley) ‘Ford’s decision to stop making cars in Australia has increased pressure on both political parties to reduce business costs and led General Motors Holden to demand the Coalition quickly detail its plans to subsidise what is left of the car-manufacturing industry, if elected.’ ‘In a … Continue reading

24 May 2013 (The Age) – Demise of Ford leaves nation’s car industry in peril

[COMMENT: Here’s a rather gloomy view of the car industry in Australia… What flow-on effects will this have?] (24 May 2013, The Age, BusinessDay, p2, Ben Schneiders and Clay Lucas) ‘Australia’s loss-making car industry is under threat and risks closure following Ford’s move to end nearly 100 years of local manufacturing. The decision comes as … Continue reading

24 May 2013 (The Age) – James Hardie posts 92% earnings fall

(24 May 2013, The Age, BusinessDay, p25, ) ‘James Hardie expects no big improvement in the housing market this year but says the sector has stabilised after interest rate cuts. Chief executive Louis Gries said the building products maker expected the housing market to be flat to slightly higher.’ Read more at TheAge.com.au

24 May 2013 (The Age) – Consumer confidence falters as thousands of jobs disappear

[COMMENT: Many more Australian jobs on the way out…] (24 May 2013, The Age, BusinessDay, p24, Clancy Yeates) ‘Thousands of workers were told on Thursday that they would lose their jobs amid growing signs the labour market is deteriorating. As Ford said it would cut 1200 jobs when it stops making cars in Australia, the … Continue reading

23 May 2013 (AFR) – Political stock sale coming soon

(23 May 2013, AFR, p2, Jennifer Hewett) ‘Consumer confidence has collapsed again this month. What a shock. Could it be that the public isn’t exactly reassured by Treasurer Wayne Swan’s approach to arithmetic – or shadow treasurer Joe Hockey’s warnings of a budget emergency?’ ‘According to the Westpac Melbourne Institute index, consumer sentiment stubbornly resisted … Continue reading

23 May 2013 (AFR) – Resources boom falls to earth

[COMMENT: This might be a signal of more tough times to come.] (23 May 2013, AFR, p1, Gemma Daley) ‘The federal government’s chief commodities forecaster has warned that the shelving of $150 billion mining and energy projects over the past year and $29 billion in cost blowouts means the resources construction boom has peaked and … Continue reading

22 May 2013 (AFR) – Investors consider margin lending

[COMMENT: WARNING!! – This is the sort of stuff that sent a lot of people broke in 2008 during the depths of the GFC – Eddie Groves was the highest profile entreprenuer to come unstuckl due to over-leveraged borrowings, but there have been many many more over the years. Investors take care… NOTE: In the … Continue reading

22 May 2013 (AFR) – Double-digit returns from bull market

[COMMENT: Might the observations described in this article be portending to a market correction?] (22 May 2013, AFR, P17, Ruth Liew) ‘As the one-year anniversary of the ­Australian equities bull market rally draws near, industry experts say some investors remain on the sidelines and are missing out on double-digit returns as the hangover from the … Continue reading

22 May 2013 (AFR) – ‘We’ll all have a nosebleed’: market rally at odds with downgrades

(22 May 2013, AFR, p16, Vesna Poljak) ‘The downgrade season has proved investors’ worst fears true as companies from mining services providers to retailers pare back earnings expectations in the countdown to the financial year-end.’ ‘With the next round of corporate earnings results due in August, companies have been slashing their profit expectations ahead of … Continue reading