Welcome to Monday and the start of a new week. Here are the five things I'm looking at today on the Australian sharemarket.
- The S&P/ ASX 200 Index (Index: ^AXJO) (ASX: XJO) has opened 0.6% higher, again following the lead set by Wall Street on Friday. The Dow Jones Industrial Average, S&P 500 and NASDAQ all posted gains of around 0.7%.
It seems investors have put the recent 'near correction' behind them and are jumping into stocks again, taking advantage of lower prices and picking up those fully franked dividend yields on offer by a number of Australian blue chip stocks.
- Amcom Telecommunications Ltd (ASX: AMM) has received a friendly merger offer from Vocus Telecommunications Ltd (ASX: VOC). Vocus has also taken a 10% stake in Amcom, suggesting that if the Amcom board reject the proposal, Vocus may turn 'non-friendly'.The approach at this stage suggests Vocus doesn't want to pay too much for Amcom, which has a market cap approaching $500 million.
The Amcom board is currently assessing the proposal, but do note that "there is no certainty that these discussions will result in a transaction". Amcom shares were up over 9% at the open, while Vocus shares were down slightly.
- The Australian Financial Review (AFR) says the big four banks will be forced to pay the price for being 'too big to fail'. The Financial system inquiry is likely to recommend the banks hold billions more in equity capital and other restrictions, which should level the playing field, allowing smaller banks to better compete, according to the AFR.But investors appear unaware of how the new rules will affect the banks' share prices and future growth, pushing up the share prices of all four in early trade. 3 of 4 are set to report later this week.
- Tweet of the Day
CSL spends $US275m buying the Novartis flu vaccine business. Our one Big Pharma company gets bigger again: https://t.co/5bKCCmzcuA
Stephen Mayne (@MayneReport) October 26, 2014
I've written before about CSL Limited (ASX: CSL), a company I see as the best stock on the ASX, in terms of management, products, shareholder friendly management and future potential growth. - Stock of the Day – brought to you by Regan Pearson – Contango MicroCap Limited (ASX: CTN). A listed investment company, Contango is paying a partly franked trailing dividend yield of 7.9%, and gives investors exposure to a wide range of diversified companies. You can read more here.
