If youre not already, its time to get
excited about stocks.
The market hit a three-month high yesterday.
And we can now see that Prime Minister Malcolm Turnbull is
prepared to splash the cash across the country.
The PM was in Victoria recently, promising funding for a
Melbourne Airport rail link.
Then he jetted to Western Australia, promising to splurge
hundreds of millions of dollars on health and transport
And now hes sweet-talking Queenslanders
The Australian Financial Review reports that the
federal government will fund half of an $800 million upgrade on the
Sunshine Coast. Its part of a $2 billion package for
Theres plenty of building going on in Australia right nowand
theres going to be plenty more in the future
The first government in years looking
forward to budget night
The PM can get away with this and still deliver modest tax cuts
because the governments revenues are smashing previous
Part of this is related to the ongoing strength in commodity
prices, which looks very bullish for Australia.
We can thank China and Japan for much of this, although for
China is actively trying to reduce its reliance on coal in order
to clean up its appalling pollution.
Its still a heavy coal user, but even this shift has sent its
imports of LNG up strongly. Its now the second highest importer in
the world after Japan. This is sending Australias LNG exports
But the bigger surprise might be Japan. Its demand for coal is
growing strongly again as it bucks the worldwide trend away from
coal burning in developed countries.
This demand is not going anywhere anytime soon. Science
Magazine reports that the Japanese government expects coal to
provide 26% of Japans electricity even in 2030.
At one point, the country wanted to slash that figure to 10%.
Instead, 36 new coal-fired power plants are on the way just to
prove the point.
This is partly whats keeping the price of thermal coal higher
than the Australian Treasury previously forecast. And coking coal
is even stronger against the previous price estimate in
The longer these prices stay strong, the more excited you should
be about the markets future. The more revenue that pours into
mining companies, the more the Aussie market will heat up
Watch for a re-rating on this
One company seeing the be...