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31 Jan 2015 (AFR) – ANZ’s hybrid still too expensive for the risk

[COMMENT: This article reflects the views of a number of commentators. Retail investors beware!] (31 Jan 2015, AFR, p28, Chris Joye) ‘The latest hybrid investment, ANZ Capital Notes 3 (ANZ CN3), looks like a much better deal than its most recent major bank predecessor, CBA’s Perls VII product, which slugged investors with capital losses of … Continue reading

31 Jan 2015 (AFR) – The five biggest risks for global investors

(31 Jan 2015, AFR, p25, Karen Maley) ‘Global equity markets have made a nervous start to the year as investors fret about five major risks which all have the potential to cause a pull-back in risk-taking and trigger a steep slide in valuations. These five dominant risks are: the possibility that the new Greek government … Continue reading

31 Jan 2015 (AFR) – Low petrol prices same as two interest rate cuts

(31 Jan 2015, AFR, p4, Jens Meyer) ‘Lower petrol prices are putting the equivalent of two rate cuts worth of savings into the pockets of households, economists say. Deutsche Bank calculates households are receiving a $7 billion boost from lower petrol prices.’ Read more at AFR.com (might need AFR login access)

30 Jan 2015 (AFR) – McDonald’s chief quits as sales flag

[COMMENT: Is this a sign of the times in the global economy? Or a reflection on McDonald’s and their product offering?] (30 Jan 2015, AFR, p31, Craig Giammona) ‘McDonald’s, the world’s largest restaurant chain, will replace chief executive Don Thompson with one of his top lieutenants following the company’s worst US sales slump in more … Continue reading

30 Jan 2015 (AFR) – Greek PM freezes asset sales, privatisations, leading to heavy market falls

(30 Jan 2015, AFR, p29, Lefteris Papadimas and Renee Maltezou) ‘Greek Prime Minister Alexis Tsipras threw down an open challenge to international creditors on Wednesday by halting privatisation plans agreed under the country’s bailout deal, prompting a third day of heavy losses on financial markets. A swift series of announcements signalled the newly installed government … Continue reading

30 Jan 2015 (AFR) – PanAust hints at writedown as output beats guidance

(30 Jan 2015, AFR, p16, Peter Ker ) ‘Copper miner PanAust has beaten analyst expectations for the December quarter and exceeded its own full-year guidance, but could yet join the long list of miners to report asset writedowns in February. PanAust indicated on Thursday the carrying values of some assets would have to be revisited … Continue reading

30 Jan 2015 (AFR) – Write-downs, cost cuts on oil price slump

(30 Jan 2015, AFR, p13, Angela Macdonald-Smith ) ‘The heavy toll of the collapse in crude oil prices is starting to hit home with Oil Search, Beach Energy and AWE among those advising of reduced costs and budgets, and some of write-downs. Oil Search flagged impairments of…’ Read more at AFR.com (might need AFR login … Continue reading

30 Jan 2015 (AFR) – Fortescue still confident after iron ore crisis – cuts cash costs, shipments soar

(30 Jan 2015, AFR, p13, Amanda Saunders) ‘A falling Australian dollar and a ­collapse in the oil price are underpinning Fortescue Metals Group’s hopes of cutting costs further this half, as the miner strives to keep its break-even position comfortably ahead of a ­massive slump in the iron ore price. Fortescue said its current ­break-even point … Continue reading

29 Jan 2015 (AFR) – Why deflation has overtaken all other worries

(29 Jan 2015, AFR, p39, Maximilian Walsh) Yanis Varoufakis: the Aussie handling Greece’s new deal ‘… Last week’s annual Davos talkathon proved to be one of those rare occasions when the high profile practitioners of the dismal science presented a united front about the outlook for the global economy. ‘<snipped…> ‘… He warned that the … Continue reading

29 Jan 2015 (AFR) – US earnings showing strain, $A builds strength against greenback

(29 Jan 2015, AFR, p23, Bianca Hartge-Hazelman) ‘Just as it looks like the case for a 2015 rate cut in Australia has weakened, the argument for higher rates in the United States is also being second-guessed as US corporate earnings show the strain being inflicted by a higher greenback and lower oil prices.’ <snipped…> ‘US … Continue reading

29 Jan 2015 (AFR) – Greek PM names anti-austerity cabinet

(29 Jan 2015, AFR, p9, Lefteris Papadimas and George Georgiopoulos) ‘Greek Prime Minister Alexis Tsipras named a cabinet of anti-austerity veterans and halted privatisation of Greece’s biggest port on Tuesday, signalling he aims to stick to election pledges despite warning shots from the euro zone and financial markets.’ Read more at AFR.com (might need AFR … Continue reading

29 Jan 2015 (AFR) – Singapore joins central banks easing monetary policy

(29 Jan 2015, AFR, p9, Sharon Chen) ‘Singapore’s central bank unexpectedly eased monetary policy, sending the currency to the weakest since 2010 as the country joined global policy makers in shoring up growth amid dwindling inflation. The Monetary Authority of Singapore, which uses the currency as its main policy tool, said it would reduce the … Continue reading

29 Jan 2015 (TheAge) – Home owners finding it easier to pay the mortgage, except some on the fringe suburbs

(29 Jan 2015, The Age, BusinessDay, p20, Stephen Cauchi) ‘Mortgage delinquencies have dropped across the nation over the past year, but lower-income earners on the fringe suburbs of Melbourne, Sydney and Brisbane are still doing it tough, a new report shows. Ratings agency Fitch says low and stable interest rates have helped home owners make … Continue reading

28 Jan 2015 (AFR) – Funds not tempted by iron ore price drop

(28 Jan 2015, AFR, p11, Amanda Saunders) ‘Another ugly dip in the price of iron ore will not tempt Australia’s fund managers back into the sector, with investors saying conditions are still too poor even for bargain hunting. The iron ore price tumbled 4.3 per cent to $US63.54 a tonne overnight Monday – its lowest price since … Continue reading

28 Jan 2015 (AFR) – Standard & Poor’s cuts Russia’s credit rating to junk

(28 Jan 2015, AFR, p9, Anna Andrianova and Ksenia Galouchko) ‘Russia’s foreign-currency credit rating was cut to junk by Standard & Poor’s, putting it below investment grade for the first time in a decade, as policy makers struggle to boost growth amid international sanctions and a drop in oil prices.’ Read more at AFR.com (might … Continue reading

28 Jan 2015 (AFR) – China cuts in coal ‘a blow’ – China cuts thermal coal use by 3pc

(28 Jan 2015, AFR, p5, Ben Potter) ‘China is cutting out thermal coal faster than previously thought, in a blow to struggling coal exporters, says top economist Ross Garnaut. The giant economy cut its use of ­thermal coal – one of Australia’s largest exports – by about 3 per cent in 2014, Professor Garnaut told The … Continue reading

28 Jan 2015 (TheAge, SMH) – Business conditions worsen and sentiment flat: NAB

(28 Jan 2015, The Age, BusinessDay, p21, SMH, Mark Mulligan) ‘Business conditions deteriorated in December and sentiment was flat, according to the latest National Australia Bank’s monthly business survey. NAB found that confidence had picked up by less than 1 index point between November and December, although it rounded it up to take the index … Continue reading

27 Jan 2015 (AFR) – Greek shift left will force negotiations – Tsipras’s dramatic win makes Greece’s creditors nervous

(27 Jan 2015, AFR, p30, Karen Maley) ‘The election victory by Greece’s radical leftist Syriza Party means financial markets will again be watching anxiously as a high-stakes poker game is played out between Athens and Brussels. Sitting at one end of the table is Alexis Tsipras, 40, the charismatic Syriza leader, who swept to power … Continue reading

27 Jan 2015 (AFR) – Forex punters vent their fury

(27 Jan 2015, AFR, p13, Jonathan Shapiro) ‘A group of foreign exchange day-traders from around the world have vented their fury with a Sydney-based online broker after the Swiss National Bank’s surprise currency move triggered “fake margin calls” that resulted in tens of thousands of dollars of losses. The foreign exchange broker, IC Markets on Bligh Street … Continue reading

27 Jan 2015 (AFR) – EU put on notice: austerity won’t work – Greece votes down austerity as Syriza and Tsipras sweep to victory

(27 Jan 2015, AFR, p10, James Chessell AFR correspondent) ‘ “Keep Calm And Go To Hell,” read one of the signs held by a supporter of the victorious Syriza party in Athens on Sunday night. Perhaps unsure if the European political and economic establishment would get the message, the signwriter had drawn a picture of … Continue reading

27 Jan 2015 (TheAustn) – Syriza sweats on creditors deal – Greece, Europe face bailout tensions as Syriza takes power

(27 Jan 2015, The Australian, p23, Marcus Walker) ‘The clock is ticking for Syriza — the victorious anti-austerity party in Greece’s elections — to strike a deal with creditors to keep Greece solvent and in the euro.’ ‘The big challenge now lies in Greece’s empty treasury, and in a game of chicken with Europe. Greece … Continue reading

27 Jan 2015 (TheAustn) – EU reels as Alexis Tsipras’s Syriza storms Athens

(27 Jan 2015, The Australian, p6, Jacquelin Magnay) ‘GREECE’S Alexis Tsipras of the far-left Syriza party last night ­secured a governing majority with the ­support of the nationalist ­Independent Greeks, hours after laying out a tough platform for negotiation with Europe after his dra­matic election triumph.’ ‘Party leader Panos Kammenos said after meeting Mr Tsipras … Continue reading

26 Jan 2015 (online) – Greek elections – where to now?

As at Monday morning (Melbourne/Sydney), we have the following online news stories, pointing to some major uncertainty in financial markets in the days ahead: Greek election: Syriza sweeping to victory – live updates See more at TheTelegraph.co.uk. Greece ‘leaves behind the austerity that ruined it,’ party leader vows after vote See more at CNN.com. Greek … Continue reading

24 Jan 2015 (AFR) – What it takes – Europe’s last chance; Mario Draghi and €1.1 trillion

(24 Jan 2015, AFR, p14, James Chessell) ‘Out of options, the ECB has joined the list of central banks printing money.’ <snipped…> ‘After years of trying the alternatives, months of debate and weeks of speculation, the ECB became the last of the world’s major central banks to unveil a full-scale government bond-buying program. True to … Continue reading

24 Jan 2015 (AFR) – Markets cheer Mario Dragi’s bold action in Europe

(24 Jan 2015, AFR, p3, Vesna Poljak) ‘The European Central Bank’s bold and bigger than expected monetary stimulus has won over investors, boosting the value of shares in all the major markets and resetting the outlook for currencies and bonds.’ Read more at AFR.com (might need AFR login access)

24 Jan 2015 (AFR) – Brighter news on Chinese economy – China manufacturing lifts but slowdown persists

(24 Jan 2015, AFR, p13, Angus Grigg Shanghai) ‘The Chinese economy has begun the year on mildly positive note with a modest pick-up in manufacturing activity, even as the spectre of deflation remains. In a week when China reported its slowest growth rate in 24 years and the International Monetary Fund downgraded its outlook, the latest … Continue reading

24 Jan 2015 (AFR) – Once again, Greece is the word – Beware Greeks going to the polls

[COMMENT: Watch out for the results of the Greek election this weekend – it could move markets.] (24 Jan 2015, AFR, p15, James Chessell) ‘When Alex Tsipras almost snatched a ­dramatic Greek election victory in June 2012, global markets were braced for meltdown. Anyone with an interest in whether the battered euro zone could keep … Continue reading

23 Jan 2015 (AFR) – Evolution Mining cuts costs as gold output climbs – warns against complacency as it reports best quarter

[COMMENT: There are some positive notes in the current financial gloom.] (23 Jan 2015, AFR, p19, Tess Ingram) ‘Australian gold producers needs to be careful not to be distracted by the better conditions the sector is basking in, Evolution Mining chairman Jake Klein has warned. A rising US dollar gold price combined with the fall … Continue reading

23 Jan 2015 (AFR) – Caution greets US house building rally

(23 Jan 2015, AFR, p18, Tim Binsted) ‘Builders in the United States last month began working on the most single-family homes since March 2008 but there is caution surrounding the speed of the recovery and its impact on the earnings of Australian companies Boral and James Hardie Industries. In a sign that US home building is … Continue reading

23 Jan 2015 (AFR) – New apartment sales rocket ahead of houses

(23 Jan 2015, AFR, p5, Rebecca Thistleton) ‘New apartment sales will dominate the housing market well into 2015, outpacing detached houses and could ultimately improve inner-city affordability. Towards the end of 2014, apartment sales were at their highest in more than a decade.’ Read more at AFR.com (might need AFR login access)