Markets Live: Stocks climb higher 1:13pm: Rio is top of the blue-chip pops, with 16 of the 20 analysts covering the stock rating it a buy, on Bloomberg data. BHP is next, while CSL also rates an overall buy recommendation from "the street." Analysts are more cautious on CBA, but rank NAB and ANZ in the top five of the dozen stocks we've picked out. Rio rates the best among analysts, followed by BHP, while CBA is the least preferred. 12:14pm: Butter is back! And its big business again, too. This from Quartz: Anglo-Dutch consumer products giant Unilever spent more than 20 years trying to beat butter at its own game. But the maker of Flora and I Can't Believe It's Not Butter, appears ready to give up the fight. "For the last 20 years or so, we have been too obsessed, overly obsessed on the fact that butter was opposed to margarine," Antoine Bernard de Saint-Affrique, the head of Unilever's Food division, told investors last month. I'm happy to say that this time is over and we have changed in a very significant way. In what Unilever executives describe as a "fundamental turnaround," the consumer products giant is now selling a spread made with butter. The move amounts to a stark about-face for a company that has been an anti-butter bastion for years. But the reversal is a wise one. As the locus of health and nutrition concerns have shifted away from fat content and toward worry over processed foods, margarine sales have tanked. In the US, margarine consumption is at a 70 year low. Since 2000, sales are down by more than 30 per cent. Meanwhile, butter consumption in the US hit a 40-year high in 2012. Sales are up by over 65% since 2000. Butter is back, and in a big way. Take that., margarine. 12:10pm: Something to lighten the mood as we head into the second half of the session (and to be honest, there's not a whole lot of news around...). 12:01pm: To recap: the ASX200 is slightly higher in choppy trade, led by banking and defensive stocks, with Wall Street closed overnight for Martin Luther King Day and offering no leads to follow. An uptick in some banking and defensive stocks is helping to buoy the index. CBA and NAB are both up 0.9 per cent, ANZ has added 0.75 per cent and Westpac 0.7 per cent. "The index has just been trailing off, it's obviously trading sideways with traders waiting for what the Fed's going to do in the US and how investors will react to that news," says Jonathan Fyfe, investment advisor and portfolio manager at Wilson HTM Investment Group. The resource sector has been worst hit as iron ore and copper dipped after near-term demand prospects from top consumer China remained muted despite slightly better-than-expected Chinese growth data. Heavyweights BHP Billiton and Rio Tinto are down 0.2 per cent and 0.7 per cent each, while Fortescue is down 3 per cent after the iron ore price slid overnight. 11:51am: Following up on that Oxfam study saying that 85 people own half the world (see 9.54am), Exec Style's Steve Colquhoun has taken a closer look at who's in that exclusive club and while the names won't come as a surprise, he notes that there's only one Australian member: Gina Rinehart's wealth is estimated at $US15.2 billion, ranking her the world's 61st richest person. Her personal fortune is estimated to exceed the GDP of 78 countries including Jamaica, North Korea and Iceland. Gina Rinehart's wealth exceeds the GDP of many small countries. 11:44am: This year should be another solid year for shareholders, despite relatively full valuations, reckon local strategists at investment bank Citi. They have a year-end target of 5850 for the ASX 200, implying a 10 per cent return from where we are now, before factoring in dividends. Underpinning their optimism is that earnings growth looks more promising, particularly in the resources sector (which they continue to favour). But they also see greater uncertainty than the previous couple of years, with the change of direction in US monetary policy looming large. Adding to that is whether or not the local economy shows signs of picking up in the next 12 to 18 months. The more cyclical industrial stocks no longer have as compelling valuations, write the strategists, but have the potential to become expensive as their earnings recover, and they also continue to prefer them over the more defensive sectors and banks. 11:44am: The easing of the resources boom has led to slower passenger growth at Brisbane Airport than its larger capital city rivals, Sydney Airportand Melbourne Airport. All three airports reported stronger growth rates for international passengers than for domestic passengers but international passengers comprise a smaller portion of traffic as a starting base at all of the airports. 11:35am: National Australia Bank is making a push to increase its share in consumer lending, cutting interest rates on personal loans and launching a new offer to woo more credit card customers. The bank today cut the variable interest rate on unsecured personal loans by 1.51 percentage points to 11.99 per cent, and launched a zero per cent balance transfer for 15 months. NAB has the smallest market share in credit cards of the big four banks, and the move suggests it is eyeing expansion in the higher-margin unsecured lending market. It comes after the big four banks have lifted their share in the credit card market over 2013, despite consumers remaining reluctant to take on unsecured debt. Recent analysis from Finder.com.au said the big four banks had increased their share of of the credit card market by 1 percentage point in the year to November, giving the majors 84 per cent of the market. However, a survey from Veda published today suggested households remain wary towards personal loans and credit cards. 11:21am: Reader 'mitch of ACT' has done some numbers crunching and comes up with an interesting stat (well, for some): Here's some information the statistical pedants on here might find useful. Since 1/7/13 the AllOrds has gone up 532 points. The breakdown by day of the week is: Mondays (103) Tuesdays 212 Wednesdays (248) Thursdays 349 Fridays 322 People on here have said that Mondays are not good days and they are right. We'd like to suggest a follow-up, mitch: is there a correlation with sunny/rainy days? 11:16am: Interesting graphic doing the rounds on Twitter (courtesy of @DonallGeoghegan) showing the proportion of CO2 emissions by country, and that there are two main culprits around (no surprise there). More to come on the implications of climate change for investors. Stay tuned. 11:06am: Japanese shares are up, with the Nikkei rising 1 per cent, amid the start of the Bank of Japan's two-day policy meeting and as a weaker yen boosts exporters. ""As the Bank of Japan meeting starts today, investors will be watching whether they raise their outlook for the economy and consumer prices,"" says Toshihiko Matsuno, a strategist at SMBC Friend Securities, a unit of the country's second-largest lender. ""With earnings season about to begin in earnest, we'll see a lot of buying in anticipation of companies posting strong results."" More than 520 companies on the Topix report earnings next week, with about 640 posting results the period after, according to data compiled by Bloomberg. 10:59am: Mortgage demand is up 15.3 per cent year-on-year for the fourth-quarter, a sharp rise from 9.3 per cent in the previous period, research compiled by a private data analytics firm shows. The increase in queries was driven mostly by older Australians, credit bureau Veda said in a report released today. The new figures reinforce official data showing that first-home buyer activity as a proportion of total borrowers fell to a record low in November amid growing investor activity. "We saw a further shift to mortgage applications from older demographics, with more first home buyers leaving the market," Veda's general manager for consumer risk, Angus Luffman, says: An extended period of low interest rates is supporting the lift in mortgage enquiries, which have stepped up a level and are now showing the strongest growth since late 2009. It is likely that we will see a continuing increase in the near term, along with sustained house price growth. 10:47am: We'd like to give yesterday's poll on our starting time another run. It seems a clear majority is shaping in favour of an earlier start, but we do want to make sure before we reset our alarm clocks... A question for our readers: what time should the Markets Live blog start each morning? Total votes: 682. Short seller ... Jim Chanos 10:41am: After years of hiding under their desks, short sellers are re-emerging - slowly, Reuters notes. Investors who make a living betting that stock prices will fall are happy to forget 2013: Credit Suisse's index of hedge funds with a dedicated short bias lost 25 per cent as global stock markets soared. Buying the most heavily shorted stocks was a much better bet than the S&P 500: a list of top shorted stocks from SunGard's Astec Analytics beat the S&P 500 by 26 percentage points on average last year. But with the Federal Reserve beginning to cut back on its bond buying - in a withdrawal of the stimulus that underpinned the rally - there's hope for short sellers in 2014. Jim Chanos, president and founder of Kynikos Associates and one of the most prominent short sellers, says the market is primed for people like him and as a result he has gone out to raise capital. Now I think is not a bad time to be raising capital for what we do. When we got a rough going in the mid-90s, that was exactly the time to raise capital," Chanos says, adding it was better to do this when critics viewed him as "like the village idiot and not an evil genius." Don Steinbrugge, chairman of Agecroft Partners, a global consulting and third party marketing firm for hedge funds, says "long/short" equity - a strategy betting both on and against stocks - will see the most demand among all hedge fund strategies this year. Long/short equity represented more than 40 per cent of the hedge fund industry assets before 2008. The sector then experienced large outflows to other hedge fund strategies including commodity trading advisers (CTAs) and various fixed income-oriented strategies. Its market share of industry assets bottomed out at approximately 25 percent in the beginning of 2013. "Last year saw this trend reverse, and we expect very high demand for long/short equity in 2014," Steinbrugge says. 10:24am: A surge in global share prices combined with a sharp fall in the value of the Australian dollar helped superannuation funds record their second-best performance last year since the introduction of compulsory contributions in 1992. The average balanced scheme posted a 17.5 per cent gain, with the top-performing fund - the REST Core vehicle - returning nearly 20 per cent, a survey from research firm Chant West showed. Behind the stellar performance was a 19.7 per cent gain in Australian shares and a 48 per cent gain in unhedged international shares. The sharp rise recorded by international shares was in part thanks to a fall in the Australian dollar to $US0.89 from $US1.04. Half of the top 10 performers last year were industry super funds. Telstra Super was the top-performing corporate fund, recording a 19.3 per cent return, while retail providers Aon, MLC, JANA and AMP also had products in the top 10. Supers" best annual performance came in 1993, one year after compulsory contributions were introduced. 10:20am: Ahead of the Reserve Bank of New Zealand's meeting next Thursday, apart from the inflation figures out today, the central bank will also get a gauge of manufacturing activity through the BNZ-BusinessNZ Performance of Manufacturing Index, which will be published this Thursday. The economic figures are key as the RBNZ is expected to be the first major central bank to raise interest rates this year. And as BK Asset Management managing director Kathy Lien points out, by mid-2016, New Zealand's cash rate is expected to raise from its current level of 2.5 per cent to 4.75 per cent. So what is this important for the Australian dollar? The divergent trajectory of the RBA and RBNZ's moves, with the Reserve Bank expected to maintain an easing bias as it waits for the non-mining sectors to fill the growth gap left by a fall-off in resources investment, is expected to weigh on the Australian dollar. The weakness in the Australian-New Zealand dollar cross rate is in turn weighing on the Australian-US dollar exchange rate. A weaker exchange rate is something the Reserve Bank has been calling for, as it prefers a lower Australian dollar, rather than further rate cuts, to drive growth in the economy. 9:57am: As we noted yesterday, the US sharemarket's "fear index," the Vix, is at very low levels, suggesting investors are relaxed and comfortable in early 2014. Also, money is pouring out of bond funds and into equity funds. Now several commentators have been pointing out how long it is since global equity markets last experienced a correction of 10 per cent. This from Societe Generale analysts: It has been 408 days since the last 10 per cent correction in the MSCI World index (see below), the 8th longest period on record. However, simply not having a correction for a long time does not necessarily imply impending doom for equities; we find no relationship between time since correction and future returns. Nonetheless we still worry how in these times of interconnected asset markets and mark-to-market risk modelling, such extended runs can hide the real volatility in equity investing. In brief it can lead to excessive risk taking. Perhaps this was also on the Richard Fisher's mind from the Dallas Federal Reserve when he pointed out that QE could be causing investors to wear beer goggles. It's been over 400 days since global sharemarkets had a collective 10 per cent correction. 9:45am: The Australian dollar has shed almost two cents against the New Zealand dollar over the past day, after new inflation data from the dairy powerhouse showed that consumer prices shot up in the fourth quarter of last year. The Australian dollar, which squeezed up higher against the New Zealand dollar yesterday, reaching US107.06¢, fell to US105.74¢ this morning. The Australian-New Zealand dollar cross rate is at eight-year lows. The stronger inflation figures leaves the door open for the Reserve Bank of New Zealand to raise the cash rate at its meeting next week. New Zealand's cash rate, like Australia, stands at 2.5 per cent. It's fuelled speculation that the RBNZ are looking to hike rates at some point. Having said that, CPI in New Zealand is still below what it is in Australia. Aussie-Kiwi is now getting closer to the multi-decades lows," Rochford Capital's director Thomas Averill said. You could see it test NZ105¢, maybe have a dip down ... towards NZ104¢. I think you are not going to see much lower than that in the Aussie-Kiwi pair. 9:39am: As expected, investors have reacted to the biggest single fall in the iron ore price this year, selling down a range of miners exposed to the bulk commodity. The metal's has dropped almost $US10/tonne in 2014, to $US124.8. Atlas Iron was the worst hit among the top 200 stocks, down more than 5 per cent, followed by Fortescue Metals, which was down 3.5 per cent. Rio Tinto is now down 1.2 per cent to $65.70 a share. On the other side of the ledger, uranium miner Paladin Energy is the best performing stock this morning, followed by G8 Education and Treasury Wine Estates. This morning's best and worst 9:26am: The Australian energy sector has felt the effects of investor apathy, reckon analysts at Standard Life Investments. The industry is investing heavily in liquefied natural gas (LNG) processing infrastructure, prompting concern about potential delays and cost overruns. This has meant the sector has been overlooked, leaving many companies undervalued for the potential growth we believe they still offer. We favour Oil Search in particular, believing it should outperform as it delivers on its investments. Indeed, its recent Papua New Guinea project update revealed it is 90 per cent complete - exactly the type of trigger that we expect will give investors greater certainty on the deliverability and production growth associated with this new capacity. Investors also appear to underestimate the impact this expansion will have on gas prices. Currently, almost all domestically produced gas is consumed domestically, meaning new output will be sold at higher overseas prices. We are particularly positive on the prospects for gas and utility firm Origin, as arbitrage should mean Australian prices converge with those overseas in the medium term. 9:12am: With no lead from Wall St (it was a public holiday in the US) the local market (S&P/ASX 200) has meandered down 0.3 per cent in early trading to 5280. Rio Tinto is down 1.3 per cent, and metals and mining stocks are leading the market lower as iron ore prices eased overnight. Across the sectors, gold miners look ready for another good day, up 0.7 per cent, and health care is also recording early gains, up 0.4 per cent. 9:05am: Over in New Zealand, annual inflation rate accelerated in the fourth quarter, underpinning the Reserve Bank of New Zealand's case to start raising interest rates this year. Consumer prices rose 1.6 per cent from the year-earlier quarter, the fastest annual pace since early 2012. Prices gained 0.1 per cent from the third quarter. Economists expected annual inflation of 1.5 percent and a quarterly drop of 0.1 per cent. Faster inflation, rising business confidence and soaring house prices add to signs the RBNZ will raise the official cash rate from a record-low 2.5 per cent before the end of the first quarter. New Zealand's currency has gained as investors bet the central bank will be among the first in the developed world to increase borrowing costs. ""Domestic inflation pressures are gradually re-emerging, but the RBNZ will have time to respond at a measured pace,"" Michael Gordon, senior economist at Westpac in Auckland, said ahead of the data. New Zealand's dollar rose after the report, buying 83.01 US cents from 82.61 cents before the release. The Australian dollar fell about 1 cent to $NZ1.0595. 8:54am: A piece that is doing well this morning is this one on the uneven distribution of wealth (which is one of the key themes in Davos, where the World Economic Forum kicks off tomorrow): Eighty-five people control the same amount of wealth as half the world's population. It shows the world's ultra-wealthy have not only recovered from the global financial crisis, they have positively blossomed. The report shows the wealth of the 1 per cent richest people in the world is worth about $US110 trillion, 65 times the total wealth of the bottom half of the world's population. It also shows the world's richest 85 people control about $US1.7 trillion in wealth, equivalent to the bottom half of the world's population. Who are the richest of the rich? Here's a useful list by Bloomberg Get rich faster ... Source: Oxfam 8:41am: Here's the Warrnambool Daily (one of the last editions, as Saputo is edging closer to success): Canadian dairy giant Saputo is nearing a majority holding in Warrnambool Cheese and Butter but must still convince investors with over 2 per cent of the company to accept its $533 million takeover offer by Wednesday evening to receive an extension on the bid. Saputo said today that acceptances of its bid for WCB had reached 47.85 per cent. So long as the company reaches 50 per cent by tomorrow evening, it will receive an automatic two-week extension on its bid, in line with legislation governing takeovers. Sources close to the deal have told The Australian Financial Review that some hedge funds are close to accepting Saputo's bid. The three-way bidding war for WCB has lasted four months and involved many of the region's dairy players. 8:36am: Iron ore is down $US10 per tonne since the start of the year and is trading around $US124.80 after falling nearly 2 per cent overnight. It is now below the trading range it's been in since the middle of last year. That puts the focus on the materials sector today, particularly the iron ore "'pure plays"'. However, IG's Evan Lucas notes that BHP is likely to continue to push ahead having closed at $38.00 yesterday, with its ADR pointing to a further nine cents to be added despite the fact iron ore has fallen: The bearish calls on iron ore are growing and that is only expected to get louder as China continues to stock pile the raw material and record production numbers flood the market. The reason for the run-up in BHP is likely to be two-fold, one: the China data from yesterday was supportive and two: BHP's fourth quarter production numbers are due tomorrow pre-market. Good morning and welcome to the Markets Live blog for Tuesday. Your blog pilots today are Jens Meyer and Patrick Commins. 8:27am: The Australian market looks set to open lower after a mixed and lacklustre performance on international markets with Wall Street closed and China turning in disappointing growth data. Iron ore miners may experience some pressure after the price of the commodity slumped another 2 per cent overnight. SPI futures down 7 points at 5249 The AUD has risen to 88.2 US cents, 91.9 yen and 65.07 euro cents Wall St was closed for the Martin Luther King Jr holiday In Europe, Eurostoxx -0.93 , FTSE100 +0.11%, CAC -0.11%, DAX -0.28% Spot gold was flat at $US1254an ounce Brent oil slipped to $US106.35 per barrel Iron ore fell 2 per cent to $US124.80 per tonne ANZ notes: It was a very quiet session overnight with US markets closed for the Martin Luther King Holiday. Overall, European equity markets were a touch softer, while core and peripheral European bond yields declined marginally. In currency markets, AUD/USD traded modestly higher overnight to around 0.88. Iron ore declined a further 2.0% to USD124.8 per tonne - its lowest level since July 2013.