WallStreet 16 Sep 2005

WallStreet investors threw caution to the winds overnight and bought rightacross the boards. They brushed aside the worst consumer confidence figure since1992 that should have knocked equities sideways. Instead all the indices surged higher but not enough to wipe outdeficit registered earlier in the week.
On the week the Dow lost a meagre 37 points while the S&P 500shed 4, the Nasdaq composite down 15 and the 100 index off 8. Overnight the Dow was up 83, the S&P 500 10, the Nasdaq composite14 and 100 index up 11.
Analysts suggest the answer is in a series of corporate upgradesmaking stocks more attractive. They are factoring in a perception that companies will do evenbetter as President George W. Bush renews his pledge to rebuild the GulfCoast after Hurricane Katrina.
It brightened the outlook for the economy and corporate profits.
Companies such as Louisiana-Pacific Corp. that stand to benefitfrom the reconstruction helped lead the gains.
Adobe Systems Inc., the world's biggest maker of graphic-designsoftware, climbed as profit beat analysts' estimates.
It tended to offset the September consumer sentiment indexplunge to 76.9 from August's 89.1 in a post-Katrina reading from theUniversity of Michigan.
US consumer confidence fell to the lowest since 1992 afterHurricane Katrina devastated the Gulf Coast and pushed gasoline prices toa record high, raising concern that Americans may curtail spending. But The US current-account gap narrowed in the second quarter,but the deficit of $195.7 billion was still the second largest ever. Analysts forecast for a deficit of $193.0 billion. The Commerce Department revised the first quarter gap to a record$198.7 billion versus a $195.1 billion deficit initially reported. Better news came from another fall in the price of October crudeoil, down $1.75 to $63 barrel on the New York Mercantile Exchange. The US dollar traded mixed while the Aussie dipped 24 points toUS76.71c. In metals gold was the star performer, climbing another $4 to$459.50 oz on the COMEX spot month, making a gain of more than $13 overthe last three trading days

Another record falls to surging market

The sharemarket charged ahead this week, closing on a record high with buying fuelled by strong commodities prices.
The benchmark ASX 200 jumped 39.7 points over the day to close at 4553.6, an 85.5-point increase for the week.
The All Ordinaries smashed through the 4500 barrier on Friday but closed just short of it at 4499.4, gaining 33 points over the day, and 66.7 over the week.
A 17-year high in the gold price, consistently strong oil prices and an updated forecast for further iron ore price rises all drove the indices to new highs.
Nomura Australia equity markets strategist Eric Betts said that although a high oil price upset consumers, it was good news for the sharemarket.
"They seem to be affecting consumer sentiment here but on the flip side, high oil prices are really a symptom of very high economic growth," he said. "This country, as a net energy exporter, is reaping a lot of income from strong energy prices so that helps the profits of Australian mining companies."

Rio Tinto reached a new high of $53.77, up $1.33 on Friday and $2.87 over the week, while BHP Billiton rose 29c to $20.99, an 80c gain on last week's close.
Good economic data from China and Japan's upward revision of GDP also contributed to local market gains, Mr Betts said.
Paul Xiradis from Ausbil Partners said market sentiment was improving in the building materials and retail sectors.
"We have seen people becoming a bit more comfortable towards retail spending and there are some indications we've seen the worst of consumer discretionary spending," he said.
Retailer Just Group, which announced better than expected results, rose 27c over the week to $2.41, down 3c on the day.
Mr Xiradis said the building materials sector appeared set to recover. Housing starts might have bottomed and some companies would benefit from rebuilding after Hurricane Katrina.
News Corp left the ASX 200 on Friday, to the benefit of other stocks. "BHP, banks and others in the top 20 stocks will probably be the beneficiaries of the final exit of News Corp," he said.
"The market has been pretty strong right around and the outlook is for more of the same," Mr Xiradis said. Things had quietened down after the reporting season but attention was likely to move towards banks, which report at the end of the month.
The US Federal Reserve decision on interest rates is likely to affect sentiment next week

The sharemarket fell back from record highs Sep 15,2005

The sharemarket fell back from record highs yesterday with only oil stocks and a resurgent Telstra defying the gloom.
The telecom's recovery from the recent sell-off was boosted as Federal Parliament gave the all clear for sale of its stake.
Telstra closed up 8c at $4.44 and was the top traded stock by volume with 61.5 million shares changing hands for $270.84 million.
Most stocks followed the lead of the US market, which was spooked by oil prices again rising above $US65 ($84) a barrel.
But FW Holst & Co analyst Michael Heffernan said the domestic market had shown strength in the face of adverse conditions.
"The market is only down 0.1 per cent. That is another very resilient day in the face of much weaker markets in the US and with oil performing the way it is."
The ASX 200 index fell 4.4 points to 4513.9. The All Ordinaries was down 7.2 points to 4466.4.
The higher oil prices saw oil and gas stocks strengthen, with Woodside Petroleum soaring 61c or 1.9 per cent to $32.71 while Santos rose 12c to $11.17.

Among banking stocks, National Australia Bank fell 14c to $31.66 after it said it would take three years to restore its retail business after a dip in customer satisfaction. Westpac dropped 12c to $20.48, CBA 8c to $37.74 and ANZ eased 2c to $22.87 as it launched its new Cambodian operations.
Despite a drop in commodity prices, mining stocks defied the market trend with Rio Tinto the best of the bunch, posting an 85c gain to $52.44.
BHP Billiton was up 11c to $20.70 and Alumina firmed 1c to $6.01.
Retail stocks also held their ground with Woolworths up 1c to $16.13 while Coles Myer rose 7c to $10.22.
Shares in Gunns jumped 21c or 6.86 per cent to $3.27 on rumours that Futuris was poised to launch a takeover bid for the group. Futuris fell 3c to $2.17.