Stock markets surging
The ASX 200 (XJO) surged by 57.5 points through 5,900 yesterday to 5915.7 leaving the market at around its highest level in 7 years.
Most sectors fared well but the industrials are clearly attracting a good deal of capital surging by 3.6 percent.
With the total balance sitting in Australian superannuation now approaching $2 million, the fickle behaviours of our stock market indices are more consequential than perhaps we might care to admit.
Although the "wealth effect" of rising home prices is well known about and documented, the evidence for whether rising stock markets have the same impact on consumer confidence and spending is less convincing.
Either way, share prices breaking 7 year highs can hardly hurt.
Anticipating stock market gyrations can be a notoriously fruitless exercise - and forecasts generally tell you more about the forecaster than they do about the future.
However, it is generally perceived to be likely that low interest rates and a "quest for yield" will push the market higher over time, a dynamic which has been seen in the US.
Household wealth to rise in 2015
Indeed 2015 is shaping up as a potentially prodigious year for Australian household wealth.
Corelogic-RP Data also reported in January that dwelling prices rose by 1.3 percent in the first month of the year, driven by gains in the largest capital cities cities of Sydney, Melbourne and Brisbane, although offset by declines in Adelaide and Darwin.
Genworth loses Westpac gig
Genworth (GMA) went ex-dividend yesterday having declared a fully franked ordinary dividend of 13.1 cents and a fully franked special dividend of 11.5 cents per share.
The share price dipped accordingly, but there was also an early gift for the shorters who had the gumption to stay short on the ex-div date as Westpac announced that it would be terminating its agreement with GMA.
This will impact GMA's gross written premiums and earnings materially from FY16.
Although mortgage delinquencies are at their lowest level since 2007, that's not a great deal of use to the insurer if future business is heading offshore.
Unfortunately for short sellers, daily shortsell statistics implied that only a miniscule fraction of the issued capital is being reported as sold short.
The share price pulled back to $3,32, although this still well above the IPO price of $2.65.