Australian markets are displaying relief and a hint of optimism at the end of a shock-free reporting season that signalled a return of confidence and earnings...

Australian markets are displaying relief and a hint of optimism at the end of a shock-free reporting season that signalled a return of confidence and earnings growth. More than half of the companies posting half or full year results beat market expectations. According to Deutsche Bank equity strategist, Tim Baker, the strength of the results was evidenced by the performance of Australian shares against the global average over the four-week reporting period. Profit numbers fell just 0.5% short of expectations while 55% of companies beat expectations. Baker expects company earnings growth in the high single digit range in 2013/14 with cyclical industrial stocks well-placed to capture improvements in the national economy. Defensive stocks are now fully priced in and banks, which have delivered 10% year-on-year earnings growth, are now at the peak of the cycle, he said. (VIEW LINK)