Market pauses but bulls still in control

The Australian sharemarket paused for a breather in the latter part of the week as investors continued to take profits in resource, energy and gold stocks.
But the retreat to defensive stocks after the bourse reached record highs thanks to rising commodity prices and a positive lead from global sharemarkets failed to overshadow bullish sentiment as it closed just short of the 4800-point mark.
The benchmark ASX 200 index ended the week up 27.7 points at 4791.1 after hitting record highs on Tuesday and Wednesday, but eased 22.6 points on Friday.
The All Ordinaries also traded at record levels, rising 27.6 points over the week to close at 4736.4 points after falling on Friday.
CMC Markets analyst David Land said investors remained bullish despite the bourse falling slightly on Thursday and Friday.
"Overall the market has had an extremely bouyant week and it looks as though we are going to close within earshot of 4800," he said.
"No doubt we will see consolidation periods in the short term but overall the sentiment remains very positive."
The bidding war between the Ten and Seven television networks and Publishing & Broadcasting Ltd's Nine Network for the rights to broadcast the AFL for five years grabbed investors' attention.
Mr Land said investors had taken a "wait-and-see attitude" towards Seven and Ten after their success in trumping the Nine bid.
They would be paying close attention to the revenues Ten and Seven generated from broadcasting the football because of the substantial premium the two networks paid for the rights. Seven rose 1c over the week to close at $8.33 and Ten dropped 7c to $3.09.
After a strong start to the week, resource and energy stocks retreated. BHP Billiton still managed to climb 60c over the week to $23.35, but Rio Tinto fell 20c to $68.80.
"Overall, the upward movements of those stocks has been very strong," Mr Land said. "[But] when you see a bit of a cooling in the price of the underlying product you see a lot of people rapidly taking their profits."
The market also searched for any hint from retailers of their performance over the Christmas period. Car parts chain Super Cheap Auto warned that "unprecedented" discounting contributed to a disappointing half-year result and fell 35c over the week to close at $2.50.
"Retail is one of the sectors on the outer at the moment," Mr Land said. "They didn't have a good year last year because consumer spending was down substantially … there is just not a lot of interest in the sector as a whole."
But the car parts chain was not totally reflective of the state of retailers. Rebel Sport was one of the best performers, rising 26c over the week to $3.
Ausbil Dexia's portfolio manager, John Grace, said investors were biding their time as they awaited the start of the company reporting season in February, although Allco Equity Partners' ongoing battle for control of Wattyl and Patrick Corp's attempts to fend off Toll Holdings did catch their attention.
AMP Capital Markets chief economist Shane Oliver said indications from the US Federal Reserve this week that interest rates in America were nearing a peak had helped major sharemarkets to start the year in positive fashion.