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ASX Hot Stocks: Wesfarmers, Seek and Coffey

The S&P / ASX 200 Index (Index: ^AXJO) (ASX: XJO) has closed lower, losing 0.5% to 5,165.7 pulled down by miners, after most commodities fell overnight. That’s despite the Dow Jones rising 0.4% and the S&P 500 adding 0.5% overnight.

Here’s why these three stocks are hot right now.

Wesfarmers Limited (ASX: WES), the owner of Coles, Bunnings, Kmart and Officeworks as well as coal and insurance businesses, saw its shares rise 3.3% to $44.20. Perhaps it was a sign of investors looking for diversified, defensive businesses, and switching out of resources stocks. Still, at current prices, Wesfarmers looks expensive on a P/E ratio of 23 and paying a dividend yield of less than 4%.

Seek Limited (ASX: SEK) saw its shares climb 8.7% to $11.10, after the company was named as a new member of the MSCI Australia Index. Index funds, and some fund managers that are benchmarked against that index, will likely be forced to buy shares in the company following its addition. Seek’s shares have risen 59% since the start of the year, as the company looks offshore to continue its stellar Australian growth.

Coffey International (ASX: COF) jumped 29.2% to 15.5 cents, recovering some of its recent falls. Despite the recovery, Coffey is still 50% below its 1 month high. Coffey saw its shares fall more than 40% on Monday this week, after the mining services company announced that it had seen 54 contracted projects delayed or cancelled. While its fairly common knowledge resources projects are being canned, surprisingly a number of projects in the oil & gas sector were also being cancelled.

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