There's never a dull moment on the Australian Stock Exchange and this week could be very lively.
1. Telstra (ASX: TLS)
According to weekend media reports, Telstra is negotiating to sell its Sensis directories business. Longer term, a cleaner Telstra is emerging and recent asset sales inevitably leads to speculation of returning the excess cash to shareholders.
In Friday's trading, the 10-year US treasury yield posted its biggest one-day drop since October as government data showed the weakest monthly job growth in three years. The Australian 10-year bond yield usually reacts in sympathy with its US counterpart and falling interest rates are generally positive for the Telstra share price, as its prized dividend looks relatively more attractive.
2. QBE Insurance (ASX: QBE)
Those same falling US interest rates resulted in a weaker US dollar and by default a higher Aussie dollar, which rose one cent to US$90.00. QBE shareholders will be hoping this is not an ongoing trend, as a rising Aussie dollar reduces its overseas revenues and falling interest rates negatively impact QBE's investment portfolio. Management maintains a conservative strategy of investing mostly in cash and fixed interest, with an average duration of six months.
Despite its blue chip status, it would be an extremely brave call to suggest catching such a falling knife, as the market braces for potentially more goodwill write-offs relating to its North American division.
3 & 4. Regis Resources (ASX: RRL) and Beadall Resources (ASX: BDR)
The unexpectedly weak US payroll numbers provided a much-needed boost to sentiment for the gold price, as it eases the pressure on the US Federal Reserve to accelerate its tapering program. Gold closed at US$1,248 (up US$20), continuing its rise from recent lows of US$1,187. Both Regis and Beadall Resources are low-cost producers with an increasing production profile.
Unemployment figures are out on Thursday and any unexpected weakness may fuel speculation about a further cut in interest rates.
