Monday, July 28, 2014

Australian Equities Market

THIS MORNING

No major economic data is scheduled. In the US, the pending home sales index, the "flash" services index and Dallas Federal Reserve index are all released.

OVERNIGHT MARKETS

US Equities

US sharemarkets fell on Friday. Shares in online retailer Amazon fell by 9.6 per cent after reporting a bigger-than-expected loss in the second quarter. Shares in Visa lost 3.6 per cent after cutting its revenue forecast for 2014. The Dow Jones index lost 123 points or 0.7 per cent with the S&P 500 index down by 0.5 per cent while the Nasdaq lost 22.5 points or 0.5 per cent. Over the week the Dow lost 0.8 per cent while the S&P 500 was flat while the Nasdaq was up by 0.4 per cent

. US treasury prices rose on Friday (yield lower) as investors reduced holdings in equities in favour of safe-have assets. US 2-year yields fell by 1 point to 0.492 per cent while US 10-year yields were down by 4 points to 2.467 per cent. Over the week US 2-year yields were unchanged while US 10-year yields fell by less than 1 point.

Major currencies were weaker against the US dollar following European and US sessions on Friday. The euro fell from highs near $US1.3475 to around $US1.3425, before ending US trade near $US1.3430. The Aussie dollar eased from highs near US94.20c to lows near US93.88c before ending the US session near US93.95c. And the Japanese yen held between 101.69 yen per US dollar and JPY101.93, ending US trade near JPY101.82.

World oil prices rose on Friday. Ongoing violence in Ukraine and tensions between Russia and western nations had investors fretting about possible disruptions to global oil supplies. Brent crude rose by $US1.32 or 1.2 per cent to $US108.39 a barrel and the US Nymex price edged up by US2 cents a barrel to $US102.09 a barrel. Over the week Brent rose by $US1.15 a barrel while US Nymex lost $US1.04 a barrel.

Base metal prices rose by up to 1.4 per cent on Friday with lead posting the strongest gain. But aluminium fell by 1.4 per cent and copper lost 0.6 per cent. Over the week, base metal prices rose up to 4.5 per cent with zinc and lead posting the best gains. Gold prices rose on Friday as investors continued to monitor the tensions between Russia and western nations. The Comex gold futures quote rose by $US12.50 or 1.0 per cent to $US1,303.30 per ounce. Over the week gold fell by $US6.10 an ounce. Iron ore rose by US70c on Friday or 0.7 per cent to $US94.30 a tonne. But over the week iron ore fell by $US2.30.

YESTERDAY'S MARKET

Local Markets Update.

This news story is reprinted from www.comsec.com.au

Read more details on Australian Stock Market

Services Integral To Free Trade Negotiations

AFTER many years of hard slog, Australia’s trade policy agenda has produced some very solid outcomes over the past six months.

This news story is reprinted from www.theaustralian.com.au

Read more details on Brisbane Accountants

Confidence Slips Among Mid-Sized Firms: CBA

CONFIDENCE among mid-sized businesses fell slightly in the June quarter but held around average levels despite the tough federal budget as firms focus on the future, according to a Commonwealth Bank survey.

The Commonwealth Bank Future Business Index, which gauges business confidence based on expectations for the next six months, eased to 10.4 points in the quarter, compared with 14.3 points in the March quarter.

CBA executive general manager of corporate financial services Michael Cant told Business Spectator mid-sized businesses were “cautiously optimistic”.

“Conditions have been challenging for some years now,” Mr Cant said. “They feel well adapted to an environment that is not booming but is not struggling.

“We saw an increasing willingness to think a bit longer term about some of the investment opportunities.” Mr Cant said although the federal budget had weighed on consumer confidence, businesses were more willing to look through the volatility and consider the medium term, with the slip in confidence mainly due to a decrease in net revenue expectations.

Many businesses were focusing on growth and investment, considering expansion plans and product innovation, he said.

By sector, manufacturing was the most confident industry at 22.5 points, while retail was the least confident at 3.1 points.

Confidence in the mining industry fell sharply to 11.6 points in the June quarter, compared with 28 points in the March quarter, as the iron ore price slumped.

“The big end of town and the big miners are still reasonably confident but some of the support services and mid-sized businesses are certainly finding it more challenging,” Mr Cant said.

Confidence in Western Australia also fell steeply, to 9.1 points compared with 28.5 points three months earlier, on worries about the mining industry.

NSW was the most confident state, lifting to 14.5 points from 10.6 points, as the broader economy gradually transitions from the resources boom.

Mr Cant linked the increase with growth in the health and aged care industries, rather than the recent boom in the property market, as the survey is forward-looking. “I think the dynamics [in property] are still fairly structurally sound but it would be hard to replicated the interest in the apartment market we’ve seen in the last 12 months,” Mr Cant said.

The index surveyed 429 financial decision markers in companies with a turnover between $10 million and $100m between May 29 and June 18.

This news story is reprinted from www.theaustralian.com.au

Read more details on Brisbane Accountants

Tax Inversions Are Increasing At ‘Breakneck Speed

Treasury Secretary Jack Lew has written an op-ed page of the Washington Post to plead with Congress to enact legislation addressing tax inversions, which he says have been increasing at “breakneck speed.”

As we’ve been discussing all this month, the number of U.S. companies re-chartering overseas to avoid corporate taxes has been accelerating recently. Tax inversions were a major theme of President Obama’s interview with CNBC’s Steve Liesman Friday.

It’s not entirely clear why the situation has only gotten worse recently, because the U.S. federal tax code hasn’t been overhauled in almost 30 years. It’s most likely the result of other countries liberalizing their tax regimes.

Whatever the reason for the spike, Lew says Congress needs to act now. He addresses the contention that addressing inversions specifically wouldn’t help because the underlying tax code would remain unchanged:

…we would still need to enact anti-inversion provisions because companies always would find countries with near-zero rates to which they could relocate. Moreover, even the most optimistic know that the administration and Congress need more time to complete bipartisan comprehensive business tax reform. While the business-tax-reform process moves steadily forward, the pace of inversions is increasing at breakneck speed. We must confront this problem now, before our tax base is so eroded as to damage the prospects of comprehensive reform.

This news story is reprinted from www.businessinsider.com.au

Read more details on Taxation Accountants.

Friday, July 25, 2014

Australian Equities Market

THIS MORNING

The Australian share market has opened flat following a mixed session on Wall Street. CommSec market analyst Juliana Roadley said the Australian market had opened mostly lower on Friday.

OVERNIGHT MARKETS

US Equities

U.S. stock futures were all green in pre-market this morning (Thursday). Dow Jones futures were up 0.16%, S&P futures were up 0.23%, and Nasdaq futures were up 0.35% as of 8:15 a.m. EDT.

U.S. Treasury debt prices fell on Thursday after data showed initial jobless claims in the world's largest economy dropped to their lowest in more than eight years, but losses may be limited by safe-haven buying given ongoing tensions in the Middle East and Ukraine.

US dollar rose against the yen and the British pound Thursday, buoyed by data showing a sharp decline in U.S. weekly jobless claims. The dollar climbed 0.3% versus the yen, to ¥101.77, its fifth consecutive rise and the highest level in one week. The pound lost 0.4%, to $1.6986, its sixth straight decline and the lowest level in a month; sterling also dropped below $1.70 for the first time since June 26. The euro was flat at $1.3463.

US Oil prices ended lower Thursday despite shrinking U.S. crude supplies and crises in Eastern Europe and the Middle East. U.S. crude-oil stockpiles dropped by almost 4 million barrels last week, the U.S. Energy Information Administration said Wednesday. The slide included a 1.5 million-barrel decline in supplies at Cushing, Okla., the delivery point for Nymex crude futures.

Base metals prices were all trading positively on Thursday morning, with the copper price in particular showing signs of improvement following upbeat purchasing managers' index (PMI) reports from China and the EU.

YESTERDAY'S MARKET

Local Markets Update.

This news story is reprinted from www.comsec.com.au

Read more details on Australian Stock Market