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Examining average hours worked

Yesterday’s analysis of the Australian Bureau of Statistics (ABS) December labour force data threw up the below chart showing how aggregate hours worked across the Australian economy rose in the month of December, but remains relatively flat compared with 12 months prior: Reader, Avid Chartist, requested that I provide a chart showing aggregate hours worked

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January 20 links: Jobs wake up call

Markets: Dollar: $US, Treasuries, ore, energy fall Undollar:  euro, Aussie, gold, metals, CRB flat, grains up. Sovereign Yields: Greece 2 Year 5 Year 10 Year Portugal 2 Year 5 Year 10 Year Ireland 2 Year 5 Year 10 Year Spain 2 Year 5 Year 10 Year Italy 2 Year 5 Year 10 Year Belgium 2 Year 5 Year 10 Year France 2 Year 5 Year 10 Year

8

Trading Day

A blessing of unicorns jumped across the rainbow fields of the S&P/ASX 200 Index today, but were taken out by short-statured hunters on a grassy knoll, as the market closed down 3 points to finish at 4214 points. The 4200 point level of resistance remains breached, with volume building and above the 20 day moving

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Inflation expectations jump

From the Melbourne Institute today, inflation expectations leap in January: The median expected inflation rate, reported in the Melbourne Institute Survey of Consumer Inflationary Expectations, increased to 2.8 per cent in January from 2.4 per cent in December. According to Dr. Michael Chua, a Research Fellow at the Melbourne Institute, “This month’s increase in consumer inflationary expectations

11

A new unemployment consensus – up

Three banks, all agree, unemployment is headed up – macrobated as it were. Westpac is the most bearish: Westpac Economics: first impressions Dec Labour Force Survey surprised with –29.3k, +24.5k full-time and flat unemployment of 5.2%. The December Labour Force Survey headline was weaker than expected; market +10k and Westpac’s bottom of the market –10k. There was

6

Employment hangs on

The Australian Bureau of Statistics (ABS) has just released the December labour force statistics and, like all of the releases this week, the data is mixed: On the positive side of the ledger, full time employment rose by 24,500 persons to 8,051,000, partly offsetting the heavy losses (-39,400) of the prior month. However, this increase

30

Rate cuts boost house price expectations

Westpac has released its quarterly house price expectations index. Since October there’s been a marked lift: The Westpac-Melbourne Institute Consumer House Price Expectations Index posted a strong rise in January, increasing 16.1pts from 9.0 in October to 25.1. This is the highest reading since April last year and the first gain since January 2010. While

35

The World Bank scenario for Oz

Far be it for me to disrupt today’s happy feeling, but following yesterday’s alarming (alarmist?) World Bank report, reader Flawse this morning asked what the consequences for Australia would be in the event of a repeat of a Lehman bank freeze. I don’t think this outcome likely. But it’s an interesting thought experiment and not

20

Zombie Europe

One of the major themes that I have been discussing in Europe for a long period of time is the simple failure of logic in which the European periphery is being instructed to push deflationary policy onto their economies, yet at the same time expected to meet their existing, and growing, debt obligations. In the

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Pessimism fatigue

Earlier this month I said: So we could see a de-coupling between economic outcomes and market performance particularly should quantitative easing recommence in the US, Europe and the UK I really think this is and remains a tradable investment theme in at least the first part of 2012 and the equity market, as represented by the

8

Chart of the Day: pump up the volume

Today’s chart is a study I’ve completed on volume of stocks traded on the S&P500 and ASX200 share markets. Given its still the first month of the year, it is expected that volume would be low (and hence volatility high?), with the gnawing possibility that the current rally in risk assets is nothing more than

2

Market Morning

Risk markets continued to rally last night, with the US dollar falling in response, as the US corporate earnings season rolls on. In detail: The UK FTSE put on 8 points or 0.1% to finish at 5702 points, just on its resistance level at 5700 points and looking bullish. The German DAX was also up,

15

Why not adopt NZ’s no-fault national insurance

I do love New Zealand.  It’s a beautiful country with great people and a relaxed attitude.  One factor that supports a relaxed attitude is New Zealand’s national enduring no-fault accident insurance scheme, which eliminates some the perceived legal risks that can stifle innovation, new business, increase medical costs, and reduce private land utilisation. I want

25

January 19 links: Three bullish themes

Markets: Dollar: $US, Treasuries, ore, CRB, grains, energy fall Undollar:  euro, Aussie, gold, metals up. Sovereign Yields: Greece 2 Year 5 Year 10 Year Portugal 2 Year 5 Year 10 Year Ireland 2 Year 5 Year 10 Year Spain 2 Year 5 Year 10 Year Italy 2 Year 5 Year 10 Year Belgium 2 Year 5 Year 10 Year France 2 Year 5 Year 10 Year Germany

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Trading Day

A choppy day on the S&P/ASX 200 Index today up just 2 points to finish at 4217 points. The 4200 point level of resistance remains broken, with volume now building post NY, above the 20 day moving average (pink line in chart below), with the the next target of 4300 points to be cleared before

25

World economic catastrophe!

As you may have read, the World Bank has issued its half yearly update, Global Economic Prospects, causing a major stir with a pretty nasty forecast of 2.5% global growth with risks to the downside if Europe gives us a credit event. I’ve attached the report below – rare as hens teeth these are, has

2

China links

Courtesy of Sinocism: Art’s New Pecking Order – WSJ.com – Picasso and Warhol are being outsold by Chinese painters as a new wave of wealthy buyers reshapes the global market. Inside China’s high-rolling art world…Another friend, Beijing hotelier Zhang Rui, has started decorating every room in his new Gallery Hotel with pieces borrowed from a gallery

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Residex house prices

Residex has released some new stats on the Australian housing market. I tend not to follow Residex to closely. I prefer RP Data’s hedonic methodology. However, in the interests of full disclosure it is always important to get a second opinion. The latest data from Residex is below. There is nothing remarkable about it and

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Chart of the Day: Margin compression

Today’s chart comes from Ed Yardeni’s blog showing the consensus annual estimates for profit margins for companies listed on the US S&P500 index: Although revenue is climbing (but still below nominal levels pre-GFC), it is evident that margins are being squeezed at circa 10% level, as corporates have presumably completed their headcount reductions and other

9

New car sales run out of road

Just released, the Australian Bureau of Statistics (ABS) has reported that sales of new motor vehicles fell in December: Seasonally Adjusted – The December 2011 seasonally adjusted estimate for new motor vehicle sales (84 403) decreased by -2.9% when compared with November 2011. When comparing seasonally adjusted estimates for December 2011 with November 2011, sales

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Victoria builds, builds and builds

The Australian Bureau of Statistics (ABS) has just released building activity data for the September, which presents yet another mixed bag: The overall value of bulding work done was essentially flat over the quarter (up 0.1%), but with some major variances across sectors: The seasonally adjusted estimate of the value of new residential building work

11

Not happy, Jan

Consumers remain in dour mood according to today’s Westpac/Melbourne Institute consumer confidence survey which showed a small rise of 2.4% but remains well off optimistic readings. According to Bill Evans: This is a somewhat disappointing result. Despite the Reserve Bank having cut the overnight cash rate by a total of 50bps with the major banks

2

Australian dollar fails

Overnight I tweeted that the Australian dollar was breaking its downtrend from the highs of last year around 1.1075/80, but it was unable to hold above the crucial 1.0420/30 region and fell back this morning to around 1.0370/80: This zone holds both the downtrend resistance from the high last year but also the 61.8% retracement of the

1

Market Morning

Risk markets were buoyed last night by the confirmation of the “soft landing = stimulus coming” meme embedded in the Chinese GDP print, where the Shanghai Composite eventually closing up more than 4%, with a successful Spanish debt auction helping Euro markets. US markets then played catch up (for once) reacting positively to the very

18

Greece poised to default

Another melee won by the ECB overnight with the LTRO once again pushing sub 3 year sovereign auctions into a “happy place”. Spain sold 12-month debt with a yield of 2.049% against a previous 4.05% in December along with 18-month paper at 2.399 percent, previously 4.226%  Greece sold 1.625 billion euros of 91-day bills in

4

China boom or gloom?

You can always tell when Wall St is set on a rally by the way its media interprets data. Last Night’s Bloomberg story on imminent Chinese stimulus is classic case in point: U.S. stocks rose, sending the Standard & Poor’s 500 Index toward the highest level since July, as slowing Chinese growth added to speculation

5

Australia lucky but not immune

HSBC’s Chief Economist, Paul Bloxham, continued his recent solid work with an interesting Research Note on the resilience of the Australian economy, echoed today by Jessica Irvine. In the note, Bloxham argues that Australia’s economy is structurally sound, with the massive pipeline of mining investment likely to augment growth over 2012. He also argues that

11

January 18 links: China confusion

Markets: Dollar: $US, Treasuries, ore,  fall Undollar: CRB, euro, Aussie, gold, metals, energy, grains up. Sovereign Yields: Greece 2 Year 5 Year 10 Year Portugal 2 Year 5 Year 10 Year Ireland 2 Year 5 Year 10 Year Spain 2 Year 5 Year 10 Year Italy 2 Year 5 Year 10 Year Belgium 2 Year 5 Year 10 Year France 2 Year 5 Year 10 Year

33

Trading Day: banking on a rally

Asian markets have all reacted favourably to Chinese Q4 GDP numbers with a surprise result of 8.9% y-o-y, although quarterly was 2% growth, with the S&P/ASX 200 Index leading the charge, bid up all day to finish up 1.5% or 63 points to 4210 points. The 4200 point level of resistance has thus been broken,

17

Mortgage data indicates ongoing melt

As UE noted earlier, the ABS has updated its 5671 dataset today which means it is time for me to update the charts that give us a sneak peak of the direction of the housing market. For those new to these charts here is what I said last time: For those who don’t know, the ABS