As the ASX 200 reporting season enters its final week the Australian stock market looks very strong closing in on recent three-year highs.
No doubt part of this is the recovery in US stocks but it is also in no small measure related to the bumper reporting season Australian companies are having.
Craig James, Comm Sec Chief Economist, said in a note to clients this morning that “Aggregate profits for the six months to December are up 18.4 per cent on a year ago. Excluding heavyweight companies (BHP, CBA, TLS, WES, FOX and NWS) profits are up 35.2 per cent.”
According to James aggregate dividends are up 3.9% on last year with 60% of companies have lifted their dividends with only 25% leaving dividends unchanged.
Stunningly, given some of the gloom in the economy there has only been 3 losses so far.
James summed it up saying that, “Total cash of the 98 companies stood at $71.1 billion at the end of December, up 44.8 per cent on a year ago.” Which means that, “Overall, companies are well placed to invest, employ or launch merger/acquisition actions.”
The RBA and Australians will be hoping they employ.