It’s not just the online bookies who have seen their clients gamble on a Coalition win in the drawn out federal election, the Australian stock market seems to taking the same punt.
Gresham Advisory Partners has flagged the rise of domestic-focused miners – up 20 per cent in market value in the past month – as a market signal that that Mineral Resources Rent Tax unlikely to become law any time soon.
Given the MRRT is a Labor proposal and that their parliamentary ally, the Greens, want to see an even tougher tax regime for miners, it seems that share market investors are leaning towards Tony Abbott being installed as Australia’s next Prime Minister.
The would put the market in line with Centrebet which has Mr Abbott on $1.50 to become Prime Minister, shorter odds that Labor’s Julia Gillard on $2.50.
To further highlight that view, Centrebet has Bill Shorten as more likely to be Labor’s leader at the next federal election.
The Gresham view was published today in its review for August of its Group 150, the top 150 ASX listed resources companies, excluding oil and gas, by market capitalisation for the month to the end of August.
“While the outcome is yet to be determined, we expect that the market is increasingly assuming that the MRRT, as presently conceived, is unlikely to see the light of day, at least for the next term of parliament,” Gresham said.
The MRRT was announced in early July by Ms Gillard, replacing the heavier taxation burden of the Resources Super Profits Tax proposed in early May by then Prime Minister Kevin Rudd.
The MRRT was limited to coal and iron ore while onshore gas projects were to be embraced by the existing petroleum tax regime.
“The average market value of domestic focussed companies since the proposed MRRT was announced has increased 20 per cent (15.4 per cent July).”
“International focused companies increased 14.1 per cent (7.6 per cent in July).”
