And that’s a wrap on the financial year! The S&P/ASX 200 couldn’t quite breach the 4,000 level on the last trading day of the month, quarter, and financial year. But it still managed to tack on 1.8% and close at 3,954.
June was a good month for most Aussie stocks. The ASX/200 was up 10.4% in June (the best month in four and half years). And for the year, stocks have climbed about 6.3%. For the financial year, they are down 24%.
Over in the U.S. stocks fell to close the quarter. Oil fell too. In fact the August futures contract fell by 2.3% back under $70. The culprit, according to news reports, was the rather weak June consumer confidence number published by the U.S. Conference Board. Mind you this was just after oil had moved to $73 and an eight-month high the day before (before negative data on U.K. GDP).
What’s with all the mixed signals? Most of it is noise. Oil prices (in addition to being driven by financial demand and speculation) are driven by inventories, demand, and production. Right now-given the fractured global economy-the price seems about right. Later (months or a year or two), as demand recovers but supply fails to grow as quickly as anticipated, we expect the price to go higher.
By the way, yesterday’s omission of nuclear energy as a potential replacement for coal-fired electricity was deliberate. Electricity from nuclear power is going to be a resurging global trend, but not in Australia (good bad or otherwise, although we think it’s ridiculous to rule it out).
That said, the Aussie uranium sector is certainly worth keeping an eye on. We’ve just wrapped up a six-month trade in a uranium stock in Diggers and Drillers that we hope resulted in a tidy profit for some readers. We’re on the look for more.
for The Daily Reckoning Australia