The market is down 86. That compares to our Futures suggesting a fall of 23 this morning. Seems like we did our dash with the 190 point rise on the ASX 200 yesterday with financials up 6.2% and Macquarie up 15%. Financials taking a breather today down 1.6%, Macquarie down 5.5% and Resources falling on yet another rise in the US$ (fall in the A$) with BHP and RIO both down in the US overnight. Metal prices up slightly. BHP down the equivalent of 107c in the US and has fallen 131c in our market this morning.

Dow up 289. Up all session – up 351 at best on the open. Busiest trading session since July 23. US stocks up on the bail out of Fannie Mae and Freddie Mac (Fannie Mae and Freddie Mac shares down 89% and 82%). Some questions about whether this should spark an equity market recovery or not (when Bear Stearns was bailed out our market rallied 16% in a few weeks). Metal prices up small. Financials in the US up 4.7%. Housing sector strongest – homebuilders up 11.6% to a 4-month high, building product companies up 8.4%, and home-improvement retailers up 5.6%. Oil unchanged – but up 3.5% in early trading on fears about hurricane Ike.

  • Both BHP and RIO slightly down in ADR form overnight, 0.13% and 0.17% respectively. BHP down 129c to 3631c. RIO down 243c to 10782c.
  • Metals all up overnight – Nickel up 1.34%, Zinc up 1.04% and Copper 0.81%. Aluminium unchanged. Oz Minerals down 8c to 143c.
  • Oil price down 12c to $106.35 – the main driver this week is expected to be Hurricane Ike. Woodside down 139c to 5684c.
  • Gold down 30c to $802.50. Newcrest down 129c to 2086c.
  • US Bonds up with the 10 year yield down to 3.68% from 3.69%.

Making the news today…not the busiest of days…

  • Aussie dollar has dropped under 81c. Now 80.93c down 0.9%. With the RBA cutting rates and the Federal Reserve expected to lift rates the trend is set…Resources caught in the middle as International hedge funds exit the A$ and their biggest equity holdings (Resources….you don’t think they come over here to buy Telstra do you?).
  • Australian Retail sales ahead of expectations up 1.4% in July 2008 (was up 0.9% in June). Compares to expectations for a 0.5% rise. But no-one too excited after changes in the method of calculation which have made the series more volatile.
  • July housing finance figures were less than expected, falling 0.2% verses the flat result expected.
  • Mincor (MCR) said it has increased resources by 14% to a record of 167,300 tons as of FY end. Production target is 19,500-20,000 tons for FY09 and MCR said it’s focused on margin improvement and reduction in cash costs amidst falling nickel prices. MCR down 1%.
  • ABC Learning (ABS) has released a market update. Says it is still finalizing its fiscal 2008 accounts and expects to release them before the end of the month. They also appointed Peter Trimble as the new CFO. Frank Ford has also decided not to join the company’s board.
  • Brambles (BXB) reiterated its guidance saying the performance over the last 2 months has been as expected. BXB up 1.1%.
  • Mirabela Nickel (MBN) says it has completed nickel and copper hedges required for loan arrangement at its Santa Rita nickel project. MBN up 1.9%.
  • Macquarie Airport (MAP) CEO Kerrie Mather told investors yesterday that MAP would not pursue acquisitions in the foreseeable future. MAP down 0.95%.
  • Macquarie Infrastructure Group (MIG) said it may divest its holdings in Lusoponte, Lisbon. MIG down 0.85%.
  • Sino Gold (SGX) has finalized a 5 year long facility for the China Construction Bank for the While Mountain Gold Mine. SGX down 0.6%.
  • Lots of Brokers lifting their target prices on Origin Energy (ORG) on the back of yesterday’s $9.6bn deal with ConocoPhillips. Merrill Lynch say the stock deserves a neutral recommendation is now worth 1900c instead of 1735c and JP Morgan upped their recommendation to Overweight and have a 2280c target price. ORG down 0.45%.
  • Seek (SEK) down 5% after Merrill Lynch said it is unlikely to outperform in the next year due to a weakening employment market. Says 40% PER premium isn’t sustainable and the recent 15% outperformance is justified. They have a 480c target price. SEK down 28c to 562c.
  • Macquarie Equities expect Energy Resources of Australia (ERA) to outperform in the short term and expect the share price to hit 2027c in the next 12 months. ERA down 4.97%. Paladin down 4.77%.
  • ABN AMRO lift their recommendation on St. George Bank (SGB) to Hold from Sell and their target price to 3007c from 2587c after Westpac sweetened their bid yesterday. Westpac have announced today the issue of debt securities. SGB down 2.26%.
  • Incitec Pivot (IPL) down 5% on the back of steep falls in international fertilizer stocks. IPL down 6.19%.

MARCUS PADLEY is the Author of the MARCUS TODAY Daily Stockmarket Newsletter.

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