Shares advanced this morning but surrendered most of their gains by lunchtime as bank stocks eased for a second day and the monthly business confidence report disappointed.
At 1pm the ASX 200 was trading four points or 0.1% higher at 5391 after hitting an early peak at 5421. Resource stocks led the advance: the gold sector rallied 1.1%, energy 0.9% and materials 0.9%. IT stocks lost 0.9% and the financial sector dropped 0.5%.
The October business confidence reading showed the "Abbott effect" faded quickly following the federal election in September. NAB's monthly confidence gauge dropped to 5 last month from the September three-and-a-half-year high of 12. Business conditions remained mired at -4.
"Forward indicators do not paint a favourable picture for the outlook, with capacity utilisation falling to a four-year low and the level of forward orders, capex and stocks also declining," NAB chief economist Alan Oster told Fairfax. "While employment conditions lifted to a one-year high, the index remained negative implying further jobs shedding."
Most Asian markets made headway ahead of a policy statement tonight from China's leaders. The Shanghai Composite rallied 0.54%, Hong Kong's Hang Seng dipped 0.08% and Japan's Nikkei gained 1.28%. Dow futures were recently up 13 points or less than 0.1%.
Crude oil futures slipped 12 cents this morning to US$94.96 a barrel. Spot gold was $2.30 weaker at US$1,280.50 an ounce. The dollar was buying 93.44 US cents.
Hope a few are paying attention to the XJO action over the last two sessions. While the spec sector is carrying on like it's 2007 (every day is "Bring a dog to work day"), the top end of the market looks temporarily exhausted. It's worth reading what Clime Capital's chairman had to say this morning (see "Outlook" under today's announcement. Share code: CAM). I'm bullish by nature but currently short-term bearish. The morning offered a get-out-of-jail card for my BRL holding, plus CWE from yesterday. The TEN bounce rounded off a profitable session.
