S&P 500was up by 17.70 points or 0.96% to 1858.83 on Monday. The Standard & Poor’s 500 Index rose, rebounding from its worst week since January, as data showing a gain in industrial production boosted optimism over the economy and investors watched developments in Ukraine. All 10 main industries in the S&P 500 advanced at least 0.5 percent. Industrial and technology companies added more than 1.3 percent. 

Factory production in the U.S. rose in February by the most in six months, indicating the industry started to recover from severe winter weather. The 0.8 percent gain at manufacturers followed a revised 0.9 percent slump in the prior month that was the biggest since May 2009, figures from the Federal Reserve showed today. The U.S. and European Union slapped sanctions on Russia in the worst dispute between former Cold War foes in more than two decades after a referendum paved the way for President Vladimir Putin to annex Crimea from Ukraine.


S&P 500 Daily Chart   (Source – Thomson Reuters)

 
S&P ASX 200was down 11.8 points or 0.22% and closed at 5317.60 points on Monday. Demand for high quality broking businesses are driving a spate of initial public offerings across theinsurance industry as investor demand heats up for diversified financial companies. One of the most keenly observed IPO hopefuls is Wesfarmers’ insurance broking business. Genworth is also expected to join the wave of public offering débutantes this year. Other upcoming insurance sector-linked IPOs include the heavily anticipated $4 billion float of government-owned Medibank Private.

Macquarie Groupis selling its private equity funds management division, ending its role as Australia’s largest and oldest private equity investor. Engineering company Cardno has ­purchased US company PPI, a specialist consultancy in the oil and gas sectors, for $US145 million ($160 million) in a deal the Brisbane-based company said would boost its earnings immediately. The Australian dollar has held above US90¢ even as tensions in Ukraine rose, with the currency strengthening in late local trade after Westpac Banking Corp dropped its interest rate cut expectations.


S&P ASX 200 Daily Chart (Source – Thomson Reuters)

The top gainers on ASX 200 were:-
 

Code	Name	Price	Change	%Change
NST	NORTHERN STAR RESOURCES	$1.33	$0.10	8.16%
GEM	G8 EDUCATION LIMITED	$4.29	$0.23	5.67%
RSG	RESOLUTE MINING LIMITED	$0.73	$0.03	4.29%
MFG	MAGELLAN FINANCIAL GROUP	$13.33	$0.42	3.25%
AOG	AVEO GROUP	$2.01	$0.06	3.08%

 

Stock of the Day – Cabcharge Australia (CAB)

Cabcharge is engaged in taxi related services, as well as having interest in bus and coach services through its interest in an associate. Cabcharge is an Australian technology, financial services, taxi payments and passenger land transport Company. It also develops and supplies in-taxi equipment. It processes a range of bank issued cards, such as MasterCard and Visa and third party cards, such as American Express and China UnionPay. It sources and builds in-vehicle equipment with a focus on customer protection and ease of payment for drivers (which includes taxi integration, global positioning system (GPS), trip details capture and contactless processing capability). Its customer base spans accounts ranging from corporations and government bodies to businesses and individuals.

CAB delivered 3% revenue growth to A$103m, EBITDA growth of 4% to A$44m and NPAT growth of 8% to A$36m. Importantly the year on year growth was across all divisions’ taxi payments (revenue +5%), taxi services (revenue +7%) and the CDC bus JV (contribution +10%). Given the challenging environment and the fact that the CDC JV lost the NSW regions 1 and 3 contracts in Sep we were expecting a 5% decline in NPAT.



Source - Cab
 
No specific guidance was provided for the remainder of the FY14. Management expects taxi payments turnover growth to be driven by generally positive economic growth. However the reduced service fee in Victoria took effect from Feb1 2014, which we expect will offset the aforementioned growth.



Cab Daily Chart  (Source - Thomson Reuters)

There are still a number of potential regulatory and competition risks associated with CAB’s operations leaving the outlook for future earnings somewhat opaque. We believe that the stock is too expensive at its current price and would review the stock at a later date.
 

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