Our market received a strong lead from Wall Street overnight (and after a three-day weekend while the Americans observed Memorial Day). Each of the major US indices closed up over 1% – the Dow Jones Industrial Average (Index: ^DJI) just tipping that mark with a 1.01% gain, while the S&P 500 (Index: ^GSPC) gained 1.1% and the Nasdaq (Index: ^IXIC) put on 1.2% in a strong night on the markets.
The ASX resolutely ignored the overnight lead, falling soon after the open to be down as much as 1% in the first hour of trade. The rest of the day was spent paring back the falls, with the S&P / ASX 200 Index (Index: ^AXJO) (ASX: XJO) closing off 0.5% at 4,094.2 points. The broader All Ordinaries (Index: ^AORD) (ASX: XAO) closed down a similar percentage to finish at 4,148.8.
Retail down… but up in trend terms
The big news of the day was weaker than expected retail sales. The Australian Bureau of Statistics reported that April retail sales fell 0.2% from a revised strong 1.1% gain in March. The lesser reported but arguably more important trend numbers were still positive – but you won't hear that reported much!
Of course, attention then turned to the likelihood (and magnitude) of the next reduction in the Reserve Bank's official cash rate. If you're feeling like this is one long Groundhog Month, you're not alone.
The most underreported figures from today might just be the construction figures – also released by the ABS – which showed an almost unbelievable 39% increase in construction in Western Australia. Hard to argue against the 'two speed economy' thesis in the face of those figures.
Wesfarmers large Target
Speaking of retail, construction and Western Australia, the groceries to coal conglomerate Wesfarmers (ASX: WES) held its annual strategy day today, telling investors that the company will be spending up to $40 million as part of a turnaround strategy for its Target retail division as it seeks to boost sales and earnings.
Target has painted a large…ahem… target (sorry!) for itself – seeking to offer better quality merchandise that stablemate Kmart and Woolworths (ASX: WOW) Big W division, as well as undercutting the prices of department stores Myer (ASX: MYR) and David Jones (ASX: DJS). The company clearly sees a large market opportunity by aiming for an unfulfilled and very large 'something for everyone' offering.
The old sawhorse suggests that trying to please everyone will only end up in pleasing no-one, but the retailer obviously believes it can do enough to claim the middle ground.
Big names making waves
It was also a big day for our corporate heavyweights, with James Packer's Crown (ASX:CWN) opening a new front in its battle with Echo Entertainment (ASX: EGP) – seeking to have the Echo chairman dumped in favour of a Packer appointment in former Victorian Premier Jeff Kennett.
Meanwhile, Gina Rinehart's Hancock Prospecting is seeking to defend the late submission of financial statements by claiming that doing so would prejudice the company's commercial position.
It also wasn't a great day for Mark Bouris – of Wizard Home Loans and Celebrity Apprentice fame. Bouris' TZ Limited (ASX: TZL) saw its share price fall 42.6% today after a potential reseller of TZ's technology advised the company it had been unsuccessful in a tender to a large parcel delivery and logistics operator.
Winners and losers
Turning to the market sectors, and with the market down 0.5%, it's not surprising that there were few sectors in the green today. Leading the way was the Telecomms sector, with a gain of 0.3%, with the Utilities gain of 0.1% the only other positive sector today.
The decliners were led by the Materials sector, which doubled the market's loss to be off 1%, the Energy sector, which gave up 0.8% and the A-REIT (Property) sector, which was off 0.6%.
Quite a few ASX 200 companies posted strong gains today, led by Cabcharge (ASX: CAB) which gained 7.2%, Bathurst Resources (ASX: BTU) and OneSteel (ASX: OST) which put on 3.5% and Bendigo & Adelaide Bank (ASX: BEN) and GWA Group (ASX: GWA) which both rallied 2.6% today.
The losers were in the ascendancy though, with 5 companies losing 6% or more. Gindalbie Metals (ASX: GBG) led the losers, falling 7%, closely followed by Sigma Pharmaceuticals (ASX: SIP) and Integra Mining (ASX: IGR) which both lost 6.4%. Gryphon Minerals (ASX: GRY) and Intrepid Mines (ASX: IAU) rounded out the bottom five, falling 6.1% and 6%, respectively.
Take the long view, Fools! We are incredibly unlikely to recall the April 2012 retail sales figures in 12 months' time, let alone 3, 5 or 10 years from now. Ditto for today's movers. Be Foolish – invest accordingly.
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Scott Phillips is an investment analyst with The Motley Fool. He owns shares in Woolworths and David Jones. You can follow Scott on Twitter @TMFGilla. Take Stock is The Motley Fool Australia's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it's still available. This article contains general investment advice only (under AFSL 400691).