Friday Flashback

THE WEEKLY WRAP: Last Friday the market once again woke up on the wrong side of bed, raising concerns for a fifth straight loss in a row.

If the BPF Group of Morgan Stanley were worried they weren’t showing, revealing in its take on the preceding days’ activities by saying, “the move has been relatively small (2%) and probably in line with a market that is having a breather after a relatively volatile couple of months.”

Friday also saw Sandfire Resources (ASX: SFR) file proceedings in the Federal Court of Australia against the Centre for Australian Ethical Research (CAER) over media releases issued by CAER and the Ethical Investment Research Service (EIRIS).
The media releases relate to corporate profiles prepared by CAER which purported to analyse the environmental, social and governance practices of certain companies including Sandfire.

CAER provided the corporate profiles to its clients, including to the Australian National University under a research agreement, which resulted in the Seat of Learning dumping all its Sandfire, and other company, shares.
Sandfire has alleged the media releases contain misleading or deceptive representations concerning the research methodology and process followed by CAER in preparing the profiles as well as the accuracy and fairness of the profile it provided in relation to Sandfire.

The weekend started well with the market closing in positive territory despite the efforts of the energy sector to the contrary.

In Brisbane world leaders met to discuss the problems of the planet with the people they like while ganging up on those they don’t.

American President Barack Obama and Chinese President Xi Jinping gently reminded all others present who is in charge by raining on Australian Prime Minister Tony Abbott’s parade to announce their plans for carbon emission cuts and a preference for clean power generation, thus placing climate change firmly on the G20 agenda.

Fortunately for Tony Abbott his Russian counterpart Vladimir Putin was in attendance to wear the heat, or chill, of the gathered spearheads to win the award for being the most unpopular participant at the summit.

After the weekend’s gabfest the market had a reasonably soft Monday to close weaker as a rising US dollar, sputtering Japanese economy and pending changes for the financial system took their collective toll on investor sentiment.

Tuesday opened a touch more optimistically only to retreat on early gains with resources stocks taking a hit despite there being no falls in iron ore or energy prices.

BHP Billiton (ASX: BHP) dropped four cents to $33.18, Rio Tinto (ASX: RIO) lost 43 cents to $59.47 and Fortescue Metals (ASX: FMG) was belted, falling 21 cents to $2.97.

The iron ore price did nothing to revive the market on Wednesday, in fact it went the wrong way to drag everybody else down with it.

At its AGM, BC Iron (ASX: BCI) regaled shareholders with facts and figures boasting a record year with 5.8 million wet metric tonnes of ore shipped (BC Iron share 4.3 million wmt), record revenue ($471 million) and NPAT ($74 million), plus a 32 cents per share fully franked dividend.

With such good news the company must be thankful it only dropped eight cents for the day to close at 57.5 cents.

Proving he either has a perverse sense of humour, or the hide of a rhinoceros, Christopher Pyne started an internet petition to save Australian Broadcasting Commission jobs in South Australia.

Obviously ABC journalists based in the City of Churches aren’t as lefty, loony, pinko biased as those in other states and territories.

Other fun to arise from AGM season saw Kidman Resources (ASX: KDR) requisitioning KBL Mining (ASX: KBL) to call a meeting of its shareholders to  consider resolutions aimed at removing all existing KBL directors and  appointing three new directors.
If the resolutions are approved, Jim Wall, Brian Wesson, Greg Starr and Bob Besley will be removed as directors and Tony Davis, Melanie Leydin and Mark Muzzin will be appointed.
Kidman’s requisition came after KBL chairman, Jim Wall adjourned the company’s AGM as soon as it began without warning or explanation.

The move resulted in KBL shareholders being unable to vote on resolutions to re-appoint Wall and Starr to the KBL Board.

Nothing much to say about yesterday’s market performance except it was pretty ugly out there as everything went backwards, including the Aussie dollar on the back of continued weak economic signs from China and a further slump in iron ore prices.