Posts Tagged ‘Nikkei’

    • Stock Market Analysis: Weekly Market Wrap

    Friday, December 10th, 2010

    Jobs and CPI

    Global share prices generally continued higher this week, but China continues to under-perform. Investors pushed stock prices lower earlier in the week, on the back of the disappointing US employment report. However concerns over tensions in the Korean Peninsular and Eurozone sovereign debt issues have abated this week and again we had encouraging US economic data. Trading volumes picked up with fund managers chasing performance as the year comes to an end. Gold and crude oil backed off record levels, while copper continued higher on fears the demand will continue to outpace supply into 2011.

    The Aussie market was driven by overseas news. The RBA left rates on hold and a surprisingly positive jobs report helped support the market late in the week.

    US Markets

    US markets have traded higher this week with the S&P 500 closing at a yearly high. This was despite weakness earlier in the week on the back of a disappointing monthly employment report which showed unemployment rose to 9.8% (up from 9.6%). The government helped sentiment by moving closer to extending the Bush tax cuts for another 2 years, which could mean a stimulus of $185 billion for the economy, according to Goldman Sachs. Overnight the US weekly new jobless claims data showed a larger fall than was expected, which encouraged traders to move away from bonds and back into equities. The Labor Department showed that first time claims for unemployment benefits dropped to 421,000 last week, the second-lowest level this year, and the 4-week average of claims also slid for the fifth straight week, to the lowest level since August 2008.

    Financials have finally started to participate in positive market activity. Gains were led by the smaller regional banks as they started to price in the probability of greater economic growth, with QE2 and the probable extension of tax cuts. The US government has also been selling down the stakes which it was forced to take up as part of the 2008 GFC bailout measures and the banks are paying back their TARP bailout obligations.

    Overnight the Dow closed flat at 11,370, while in the broader market the S&P 500 index was up 0.4% at 1,233 and the tech-heavy Nasdaq ended up 0.3% at 2,617.

    European Markets

    European markets continued their positive momentum this week. The European Central Bank (ECB) and the Bank of England (BoE) left rates on hold and the ECB delayed its withdrawal of emergency liquidity measures and bought government bonds in Portugal, Ireland and Greece. The ECB pledge to fight the “acute” financial market tensions is paying dividends with European shares advancing to 2-year highs, led by financials as investors are becoming more comfortable that the global economic recovery is still on track. The Stoxx Europe 600 Index rose 0.4 percent to its highest close since September 2008, as the measure has risen 8.7 percent for the year, on the back of improving corporate profitability.

    In the UK the market traded around 3-month highs, while Germany continues to outperform. Sentiment also improved after a promising presentation from Barclays PLC strategists, who expect a rally in 2011 based on low valuations coupled with profits and economic growth. They forecast the Euro Stoxx 50 Index to gain 18 percent from current levels through 2011, with key sectors being basic resources, financials, food retail and industrial companies.

    Overnight in London the FTSE 100 index closed up marginally 0.2% at 5,808, the German DAX was down marginally -0.2% at 6,964, while in France the CAC was up 0.7% at 3,877.

    Asian Markets

    Asian markets were mixed this week. The Chinese and Hong Kong markets fell on anticipation that the CPI reading due out tomorrow may be higher than expected, which will add fuel to concerns that the government may have to raise interest rates sooner rather than later. Resources stocks have been under pressure, on concerns that a hike in interest rates would impact demand for commodities. The Chinese market has been trading in a range for the past 4 weeks, so watch for a breakout near-term. Japan bucked the trend trading at 7-month highs this week, led by banks and insurers. The Japanese economy grew by more than previously forecast in the 3Q due to capital spending by companies and support from the surge in the US financial sector. Japanese exporters benefited from a sliding yen as well.

    Overnight In China the SSE Composite closed down -1.3% at 2,811, while in Hong Kong the Hang Seng Index was up 0.3% at 23,172 and in Japan the Nikkei 225 Index was up 0.5% at 10,286.

    Commodities

    Copper remained around record levels this week, due to continuing concerns that demand will outpace supply into 2011, driving prices higher. The strengthening US dollar is dragging down other commodity prices though. Gold dropped below $US1,400 an ounce, while oil slipped after official inventory figures showed a drop of 3.8 million barrels, more than had been expected. The Dollar Index was flat at 80.01, while the Australian Dollar last traded higher at 98.43. Commodities were generally mixed.

    Overnight the benchmark crude NYMEX for December delivery was up 0.3% to settle at $US88.54. Copper prices backed off 2-year highs: copper for December delivery was down -0.7% at $US4.0665. Gold prices traded off all-time highs again, with December gold up marginally, 0.2% at $US1,385.50.

    ASX News

    The Aussie market continued its positive momentum this week, though commodities have seen some profit taking as the US dollar strengthens. Investors continue to focus on overseas positive manufacturing and jobs data from China and Europe, and the continuing rise in US stock prices. Fund managers are busy chasing performance as the year comes to a close. The RBA left rates on hold as expected, but the surprise tightening in the employment market actually pushed the bourse higher late in the week. The fact that the financials are starting to participate in the positive activity in the US is a good indicator for 2011.

    Our View

    Markets have continued higher this week as expected, but commodities prices are backing off record levels as traders start to take profits. Economic data released this week continues to support the view that the global recovery is still on track, and the upbeat report on the UK economy from Barlays PLC bodes well for 2011.

    The S&P ASX200 is currently trading around 4737 which is close to the key weekly pivot level (4700) which has been in place since August. Momentum should continue into next week, but be aware that this will be the last serious week of trading for the year. Use the Aussie dollar as a leading indicator for our market and be wary of the Chinese response to its CPI data due out tomorrow. Also watch out for confirmation of the extension of the Bush tax cuts next week. Key levels for next week will be 4810 to 4650.

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Escalation of Tensions in Korea Discounted By The Markets

    Thursday, November 25th, 2010

    US stocks rose sharply overnight, as investors went shopping before “Black Friday”, buying up retail stocks and erasing almost all of sharp declines of the previous session, as the latest economic data indicated US growth is improving. European stock markets advanced overnight as markets recovered from the heavy losses from earlier in the week.  Asian markets ended mixed, as Hong Kong and Chinese investors went bargain hunting, as they discounted the impact of geopolitical risks of the Korean tensions. Commodities prices recovered overnight.

    The SPI Futures is below its key support level of 4600 and the ASX is set to open higher as the SPI Futures closed up 0.8% (or 38 pts) at 4,624.  The key levels for our index today are 4685 and 4600. M&A activity continues to drive specific stocks.  The ASX is set to open higher today, with positive leads from overseas markets. The gains should be broad-based as bargain hunters step in, with commodities prices recovering overnight.

    US Markets

    US stocks rose sharply overnight, as investors went shopping before “Black Friday”, buying up retail stocks, erasing almost all of sharp declines of the previous session, as the latest economic data indicated U.S. growth is improving.  “Black Friday” is the Friday after Thanksgiving and often sets the tone in retail through to Christmas.  Economic reports encouraged investors that the US economy is improving.  The Reuters/University of Michigan consumer sentiment index rose to 71.6 in November (up from 67.7), better-than-expected.  Americans earned more (with incomes rose 0.5 percent last month) and spent more (with spending rising 0.4 percent) in October, both were slightly better than expected September.  The number of people applying for unemployment benefits dropped (by 34,000) last week to the lowest level in more than two years.  However on the flip side manufacturing orders fell and new home sales in the US tumbled in October while the median home price dropped to the lowest point in seven years.  The market recovery came as the global response to the tensions on the Korean Pennisular was muted, after the exchange of artillery fire between North and South Korea on Tuesday.  Defensive stocks moved lower as investors became more willing to take on risk.  The dollar and gold both fell, while Treasury prices were lower, pushing their yields higher.  The gains were broad based and the best sectors in the market included: Industrial up 2.1%, Consumer Discretionary up 1.8%, while Materials and Energy were each up 1.7%.  US stock and bond markets will be closed Thursday for the Thanksgiving holiday. They will reopen for half-day sessions on Friday.  The Dow closed up 1.4% (or 151 points) at 11,187, while in the broader market the S&P 500 index up 1.5% (or 18 points) at 1,198 and the tech-heavy Nasdaq ended up 1.9% (or 48 points) at 2,543.

    European Markets

    European stock markets advanced overnight.  Markets recovered from the heavy losses from earlier in the week, as strong data from Germany helped offset continuing sovereign-debt fears.  The German market continues to outperform, after the Ifo Institute released the closely watched business climate index rose to its highest level since the reunified og Germany.  The promising reports from the U.S. also helped the European markets.  In the U.K. markets rose, as the Irish government revealed the details of its EUR15 billion austerity plan.  However the Bank of Ireland slumped again down 11% on reports that the Irish government will take a majority stake as part of the bailout package.   In London the FTSE 100 index closed up 1.4% (or 76 points) at 5,657, the German DAX up 1.8% (or 119 points) at 6,824, while in France the CAC was up 0.6% (or 24 points) at 3,766.

    Asian Markets

    Asian markets ended mixed. Sentiment took a hit initially as many Asian investors got their first chance to react the North Korean artillery attack on a South Korean island, but buying quickly picked as fears of a rapid escalation in the conflict abated. The Korean market finished lower, but staged a recovery from the earlier losses, on hopes that tensions on the Korean Peninsula will be short lived and as foreigners went bargain hunting for beaten down stocks.  The Japanese market opened sharply lower in reaction to tensions in Korea, but trimmed its losses by the close.  Exporters weighed on the market as the euro earlier fell sharply, on continuing concerns Irish debt problems may spill over to other euro-zone countries.  In Hong Kong and China bargains hunters stepped in.  The banks led gains in China, with the successful capital raising by the Industrial & Commercial Bank of China.  In China the SSE Composite closed up 1.1% (or 32 points) at 2,860, while in Hong Kong the Hang Seng Index was up 0.6% (or 128 points) at 23,024 and in Japan the Nikkei 225 Index was down -0.8% (or -80 points) at 10,030.

    Commodities

    The Dollar Index up marginally 0.1% at 79.76 on a flat Euro, while the Australian Dollar last traded higher at 98.12.

    Benchmark crude NYMEX for December delivery was up sharply 3.6% (or $US2.90) to settle at $US84.15. Copper prices backed-off 2-year highs, Copper for December delivery was up 1.5% (or 5.5 cents) at $US3.7630. Gold prices off all-time highs again, with December gold was down -0.3% at $US1,377.80.

    Key International News Drivers Today

    US - Tensions between North and South Korea fear recede, as traders focus on “Black Friday”.
    EU - Investor go shopping in the euro zone.
    CHINA – Government stands firm on access to credit. China prospect of implementing further tightening measures.
    JAPAN – Market closes above 10,000, still outperforming.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Up 1.4% (or 151 pts)  at 11,187

    The S&P 500

    Up 1.5% (or 18 pts)  at 1,198

    The Nasdaq

    Up 1.9% (or 48 pts)  at 2,543



    The FTSE 100

    Up 1.4% (or 76 pts)  at 5,657

    The German DAX

    Up 1.8% (or 119 pts)  at 6,824

    The Fench CAC

    Up 0.6% (or 24 pts)  at 3,766



    The Dollar Index

    Up  Marginally 0.10% at 79.76

    The Australian Dollar

    Last traded at 98.12

    The Commodities Index

    Up 1.6% at 302.3



    Crude Oil Futures

    Up Sharply 3.6% at $84.15

    Gold Futures

    Down -0.3% at $1,377.80

    Copper Futures

    Up 1.5% at $3.7630

    SPI Futures

    Up 0.8% (or 38 pts) at 4,624





    Market

    Movement

    SSE Composite (China)

    Up 1.1%  at 2,860

    Hang Seng Index (Hong Kong)

    Up 0.6%  at 23,024

    Nikkei 225 Index (Japan)

    Down -0.8%  at 10,030


    ASX News Today

    The SPI Futures is below its key support level of 4600 and the ASX is set to open higher as the SPI Futures closed up 0.8% (or 38 pts) at 4,624. The key levels for our index today are 4685 and 4600. M&A activity continues to drive specific stocks. The ASX is set to open higher today, with positive leads from overseas markets. The gains should be broad-based as bargain hunters step in, with commodities prices recovering overnight.

    AGO- Atlas Iron has started discussions with BHP Billiton about co-operating on iron-ore haulage and port access in Australia’s Pilbara region. This move could open up the region for other small producers.

    BOW- Bow Energy the gas and oil explorer is on track to deliver commercial gas flows and increased gas reserves by the end of 2011.

    CGT- Castlemaine Goldfields will reopen the Ballarat mine it purchased from the former Lihir Gold in central Victoria, with production possibly within a year.

    FRS- FerrAus has held talks with a subsidiary of BHP Billiton after BHP has taken the emerging producer to court over failed negotiations for a rail haulage deal.

    FXJ- Fairfax Media says combining the company’s metropolitan newspapers and online properties under the one roof will yield $10 million in annual savings.

    FMG- Fortescue Metals Group has defended itself against the allegations of misleading and deceptive conduct by the corporate watchdog.

    GNS- Gunns says it will close several northern Tasmanian woodchipping sites as part of a major operational restructure of its forest products division.

    FPH- Fisher & Paykel Healthcare has reported a 54 percent fall in 1H11 net profit to $13.2 million, citing unfavorable exchange rate movements and a one-off non-cash deferred tax charge.

    HGL- HGL has reported a 67.5 percent rise in annual net profit and says it’s optimistic about the coming year.

    LYC- Lynas Corp in talks to secure additional supplies of rare earths products for the Japanese market by accelerating the expansion of its Rare Earths Project.

    MAK- Minemakers the exploration company plans to spin off its Tasmanian assets and list a new company in a $10 million initial public offer.

    NZO- New Zealand Oil and Gas is in a trading halt after confirmation all 29 miners trapped in the Pike River Coal Mine had perished.

    PRG- Programmed Maintenance Services has reported a $3.07 million 1H11 loss but says earnings will improve in the second half.

    TEN – Lachlan Murdoch has finalised the purchase of the half stake form James Packer’s recent purchase

    VBA- Virgin Blue will add a further two wide-body Airbus A330 aircraft to its domestic fleet by 2012.

    Economic Reports :

    RBA Gov Glenn Stevens Speaks
    ABS private new capital expenditure and expected expenditure for September quarter.
    NAB – National Bank CEO Cameron Clyne to address Trans-Tasman Business Circle luncheon.

    Companies:

    Beach Petroleum (BPT) Full year 2010 AGM
    Goodman Fielder Ltd (GFF) Full year 2010 AGM
    Gunns Ltd (GNS) Full year 2010 AGM
    GrainCorp Ltd (GNC) Full year 2010 Results
    Peak Oil and Gas Lists on the ASX today
    Tower Australia Ltd (TAL) Full year 2010 Results

    Ex-Dividends

    TFS Corporation Ltd (TFC)

    Market Summary

    ASX – to open higher
    US & UK/Europe – higher
    US ADRs –  Broadly Higher

    BHP up 2.2% &
    RIO up
    AWC up 3.6%
    ANZ up 2.1% &
    NAB up 2.3%
    NEM up 1.0%
    JHX up 2.6%
    NWS up 1.4%

    Commodities Stock Index up 1.7%
    Gold Stocks Index up 0.3%
    Oil Stocks Index up 1.6%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Concern Over Contagion, Insider Trading And Chinese Measures

    Tuesday, November 23rd, 2010

    US markets fell overnight as investors worried about contagion from Europe’s financial crisis and a widening probe into insider trading in the US. European stocks fell after early gains on the back of Ireland saying it would accept a bailout deal. Asian stock markets ended mixed for the week. Japan outperformed, while Chinese financials and property stocks dragged on sentiment, as the government may need to announce further inflation control measures. Commodity prices have fallen over the week on the back of the higher US dollar.

    The SPI Futures is below its key pivot level of 4725 from last week and the ASX is set to open lower as the SPI Futures closed down -0.8% (or -35 pts) at 4,630. The key levels for our index today are 4700 and 4600. M&A activity continues to drive specific stocks. The ASX is set to open lower today with negative leads from overseas markets, particularly in the financial sector.

    US Markets

    US markets fell overnight. Investor are concerned about contagion from Europe’s financial crisis and a widening probe into insider trading in the US. As if US banks did not have enough to worry about, already under pressure because of concerns over the impact of the Irish bailout. The FBI raided the offices of two hedge funds as part of a broad insider trading probe, which sent Goldman Sachs Group plummeting 4.3 percent, while Morgan Stanley and Bank of America each fell 3 percent. The tech-heavy Nasdaq managed some gains, with Amazon up 2.6 percent and Apple up 1.2 percent. Key sectors in the markets were Financials which dragged down -1.4%, Energy and Industrials were down 0.3%, while consumer discretionary was up 0.3% and Materials was up 0.2%. It is a busy week for economic data for investors to digest in this week shortened by the Thanksgiving holiday on Thursday. Some of these reports include October home sales, an update of consumer sentiment and revisions to earlier estimates of the 3Q gross domestic product and Black Friday. The Dow closed down -0.4% (or -39 points) at 11,164, while in the broader market the S&P 500 index down -0.3% (or -3 points) at 1,196 and the tech-heavy Nasdaq ended up 0.3% (or 8 points) at 2,526.

    European Markets

    European markets ended lower overnight. Gains early in the session in reaction to the proposed deal between Ireland, the European Union and the International Monetary Fund to rescue Ireland’s struggling banks, faded quickly. Falls were led by the banks as the fears of contagion continued, as other euro zone countries may need to be bailed out like Ireland. The Bank of Ireland was down 19 percent, and Spanish majors heavyweights Banco Santander and BBVA, down over 4 percent. Sentiment was not helped by the Moodys Rating Agency saying it might lower Ireland’s credit rating more than expected. The German market backed-off its 30-month highs. In London the FTSE 100 index closed down -0.9% (or -52 points) at 5,681, the German DAX down -0.3% (or -22 points) at 6,822, while in France the CAC was down -1.1% (or -41 points) at 3,837.

    Asian Markets

    Asian markets were ended mixed. Financials were among the biggest sectoral losers, after the Chinese central bank said last week it would raise bank reserve requirement ratio by 0.50 percentage point from 29 November. Hong Kong stocks kept falling with losses in property stocks after new measures to stem speculation, including additional stamp duties on properties that are resold within two years and raised down payment requirements on high-end home purchases to curb speculation in the local housing market. Chinese shares closed mixed in subdued trading, as investors awaited further policy moves from the government, after last week’s report of inflation at a 25-month high. Japanese stocks continued higher to at a 5-month high, as the yen’s decline against the euro spurred buying interest, as the Japanese Nikkei remains above 10,000 and its 200-day moving average resistance that had held since May with gathering momentum. In China the SSE Composite closed down marginally -0.2% (or -4 points) at 2,884, while in Hong Kong the Hang Seng Index was down -0.4% (or -82 points) at 23,524 and in Japan the Nikkei 225 Index was up 0.9% (or 93 points) at 10,115.

    Commodities

    The Dollar Index up 0.3% at 78.70 on lower Euro, while the Australian Dollar last traded lower at 98.86. Commodities were generally lower.

    US crude oil futures fell for the sixth session in seven, after completing a second straight week of losses, as China increased bank reserve requirements to fight high inflation. Gold prices continued lower, having fallen for a second consecutive week as the metal was caught up in broad-based selling, along with other commodities, by investors’ need to liquidate positions amid increasing margin calls. Copper ended down the session lower, after having its biggest weekly decline in three months, after further steps by China to slow its excessive growth rate and lingering debt troubles in Ireland stoked investor concerns about demand for industrial metals.

    Benchmark crude NYMEX for December delivery was down -0.5% (or $US-0.41) to settle at $US81.57. Copper prices backed-off 2-year highs, Copper for December delivery was down -2.2% (or -8.4 cents) at $US3.7695. Gold prices off all-time highs again, with December gold was up 0.4% at $US1,352.20.

    Key International News Drivers Today

    US – FBI raided the offices as part of a widening probe into insider trading.
    EU – Investor concerns over sovereign debt problems and contagion in the euro zone.
    CHINA – Government stands firm on access to credit. China is implementing tightening measures.
    JAPAN – Market closes above 10,000, still outperforming.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Down -0.4% (or -39 pts) at 11,164

    The S&P 500

    Down -0.3% (or -3 pts) at 1,196

    The Nasdaq

    Up 0.3% (or 8 pts) at 2,526

    The FTSE 100

    Down -0.9% (or -52 pts) at 5,681

    The German DAX

    Down -0.3% (or -22 pts) at 6,822

    The Fench CAC

    Down -1.1% (or -41 pts) at 3,837

    The Dollar Index

    Up 0.25% at 78.70

    The Australian Dollar

    Last traded at 98.86

    The Commodities Index

    Down -0.3% at 298.0

    Crude Oil Futures

    Down -0.5% at $81.57

    Gold Futures

    Up 0.4% at $1,352.20

    Copper Futures

    Down -2.2% at $3.7695

    SPI Futures

    Down -0.8% (or -35 pts) at 4,630

    Market

    Movement

    SSE Composite (China)

    Down Marginally -0.2% at 2,884

    Hang Seng Index (Hong Kong)

    Down -0.4% at 23,524

    Nikkei 225 Index (Japan)

    Up 0.9% at 10,115


    ASX News Today

    AGO- Atlas Iron has started discussions with BHP Billiton about co-operating on iron-ore haulage and port access in Australia’s Pilbara region. This move could open up the region for other small producers.

    APN- APN News and Media expects to report FY11 earnings in line with market consensus amid improving advertising conditions.

    AXA- All of AXA Asia Pacific Holdings independent directors have decided to support the $14.5 billion takeover bid by AMP and the company’s French parent.

    BOW – Bow Energy the gas and oil explorer is on track to deliver commercial gas flows and increased gas reserves by the end of 2011.

    BPT- Oil and gas explorers Beach Energy and Impress Energy are to merge to accelerate the development of their assets in South Australia’s Cooper Basin.

    BRM- Brockman Resources the iron ore explorer, is urging shareholders to reject an unsolicited all-scrip takeover offer from Hong Kong listed Wah Nam International Ltd.

    FMG – ASIC has continued its bid to prove Fortescue Metals Group Ltd misled investors over “binding” deals with Chinese entities that never eventuated.

    FRS – FerrAus has held talks with a subsidiary of BHP Billiton after BHP has taken the emerging producer to court over failed negotiations for a rail haulage deal.

    KAR – Karoon Gas the gas explorer has cancelled the float of its South American assets due to unfavourable financial market conditions.

    MCC- Macarthur Coal the coal miner, is forecasting 1H11 profits strongly up on a year earlier, on the back of demand growth and a tightening market.

    NAB- National Bank is facing a shareholder class action provisionally claiming losses of $450 million for the bank’s failure to disclose its exposure to sub prime securities during the GFC.

    NZO – the major shareholder of NZ’s Pike River mine, said the rescue effort continues for the 29 men who remain trapped.

    QRN- Queensland’s rail freight company listed on the ASX in the largest share market listing since Telstra was privatised from 1997. Shares closed up 4.3%.

    SHL- Sonic Healthcare has reaffirmed its FY11 profit guidance of 5 to 15 percent growth as its Australian pathology volumes return to long term trend levels.

    TAH- Tabcorp the gaming company, has completed the final stage of its equity raising, with its retail bookbuild oversubscribed.

    TEN- Gina Rinehart, has bought 10% of Ten Network Holdings Ltd. This follows James Packer recent pickup of an 18% stake.

    TLS- the Future Fund Telstra’s major shareholder, opposed all resolutions put to Telstra Corporation Ltd’s AGM.

    WBC- Westpac is set to benefit from increased business borrowing by large companies is set to rebound in 2011 as they are expected to grow revenue and hire more people.

    WDC- Westfield Group will sell half of its interest in the retail component of the property group’s Stratford City centre in the UK for $1.4 billion.

    WOW- Woolworths reaffirmed its previous guidance for net profit to rise between 8 and 11 percent in the FY11.

    Economic Reports :

    CB Leading Index for month
    Construction Work Done for Quarter

    Companies:

    IOOF Holdings Ltd (IFL) Full year 2010 AGM
    Harvey Norman Ltd (HVN) Full year 2010 AGM
    TFS Corp (TFC) Full year 2010 AGM
    Navitas Ltd (NVT) Full year 2010 AGM

    Ex-Dividends
    None

    Market Summary
    ASX – to open lower
    US & UK/Europe – lower

    US ADRs – Generally Lower

    BHP up 0.1% &amp
    RIO down
    AWC down 1.2%
    ANZ down 0.9% &amp
    NAB down 0.3%
    NEM up 1.0%, JHX down 1.2%, NWS up 0.1%

    Commodities Stock Index up 0.4%
    Gold Stocks Index up 1.2%
    Oil Stocks Index down 0.4%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Markets Slide Down The Wall of Worry

    Wednesday, November 17th, 2010

    US markets succumbed to selling with their biggest one-day drop in almost a month, as commodities fall sharply, potentially setting up for key reversals. Globally investors are spooked by fears mounted over a slowdown in Chinese economic growth, EU sovereign debt concerns and criticism over the effectiveness of the Fed’s QE2. US dollar continues to find support. European stock markets finished lower overnight, as concerns over sovereign debt for the PIIGS countries, particularly Ireland. Asian stock markets ended lower yesterday, as Chinese stocks again sold-off sharply on further tightening measures and fears of slowing growth.

    The SPI Futures is below its key pivot level of 4725 and the ASX is set to open lower as the SPI Futures closed down -1.3% (or -61 pts) at 4,652. The key levels for our index today are 4680 and 4600. M&A activity continues to drive specific stocks. The ASX is set to open lower, led by the miners. Honor your stops or use options o protect your portfolio.

    US Markets

    US stocks fall to their biggest one-day drop in almost a month. Investors are spooked by fears mounted over a slowdown in Chinese economic growth, EU sovereign debt concerns and criticism over the effectiveness of the Fed’s QE2. Commodities prices were hit over fears that China will need to move to raise interest rates in order to reign in inflation. The Dow Jones hovered around 11000 level, which has held since mid-October.Only Home Depot Inc and Wal-Mart Stores Inc both posted gains in the Dow 30, after reporting better results, while Alcoa Inc leading the declines (down 3.0%) on concern that the push to limit growth in China could lead to lower demand for aluminum. On a sector basis the sell-off was broad with the leading declining sectors were the Mining sector was down 2.1%, Energy down 1.9%, Financials down 1.7% and Industrials down 1.6%. The Dow closed down -1.6% (or -178 points) at 11,024, while in the broader market the S&P 500 index down -1.6% (or -19 points) at 1,178 and the tech-heavy Nasdaq ended down -1.7% (or -44 points) at 2,470.

    European Markets

    European stock markets finished sharply lower overnight, as concerns over sovereign debt for the PIIGS countries, particularly Ireland. The sell-off was broad-based, with banks, insurers and mining shares were particularly hard hit, after worries about the Chinese economy and uncertainty over sovereign debt. Investors are spooked over the possibility of an Irish bailout, as European officials are reportedly considering a EUR80 to EUR100 billion rescue for Ireland and also discussing a smaller bailout for the Irish banking sector alone. If and when the Irish bailout is resolved, investors are then likely to turn to Portugal and Spain, who are next in line when it comes to sovereign debt concerns. On top of the EU debt crisis is the expectation that the Chinese government is going to have to take fresh action to moderate growth in order to restrain inflation, thereby adding to market worries with a corresponding dampening of demand, particularly for commodities. In London the FTSE 100 index closed down -2.4% (or -139 points) at 5,682, the German DAX down -1.9% (or -127 points) at 6,663, while in France the CAC was down -2.6% (or -102 points) at 3,780.

    Asian Markets

    Asian markets ended lower, with China again dropping sharply. In China property developers sold-off on fears of further tightening measures targeting the sector, while a rate hike from the Bank of Korea weighed on Seoul shares. The Chinese government announced new limits on the ability of foreigners to buy residential or commercial property on the mainland in its latest effort to curb hot money inflows and ease inflationary pressures. Mining stocks led the decline after fears of an interest-rate hike returned to the Chinese market, weighing on commodity prices. In Japan the market ended lower, even though the weakening yen prompted some buying in exporters’ stocks. In China the SSE Composite closed down sharply -4.0% (or -120 points) at 2,895, while in Hong Kong the Hang Seng Index was down -1.4% (or -334 points) at 23,693 and in Japan the Nikkei 225 Index was down -0.3% (or -30 points) at 9,797.

    Commodities

    The Dollar Index up 0.9% at 79.20 on lower Euro, while the Australian Dollar last traded lower at 97.68. Commodities were sharply lower.

    Benchmark crude NYMEX for December delivery was down -3.2% (or $US-2.68) to settle at $US82.18. Copper prices backed-off 2-year highs, Copper for December delivery was down sharply -5.3% (or -21.0 cents) at $US3.7135. Gold prices off all-time highs again, with December gold was down -2.2% at $US1,336.10.

    Key International News Drivers Today

    US – Dow Jones tesgin key 11000 level. Investors spooked by EU dxebt and Chinese prospect of slowdown.
    EU – Investor concerns over sovereign debt problems in the euro zone, sparks sell-off.
    CHINA – Government stands firm on access to credit. China is set to overtake the U.S. as the world’s largest economy according to a report from Standard Chartered.
    JAPAN – Market backs-off four months highs.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Down -1.6% (or -178 pts) at 11,024

    The S&P 500

    Down -1.6% (or -19 pts) at 1,178

    The Nasdaq

    Down -1.7% (or -44 pts) at 2,470



    The FTSE 100

    Down -2.4% (or -139 pts) at 5,682

    The German DAX

    Down -1.9% (or -127 pts) at 6,663

    The Fench CAC

    Down -2.6% (or -102 pts) at 3,780



    The Dollar Index

    Up 0.87% at 79.20

    The Australian Dollar

    Last traded at 97.68

    The Commodities Index

    Down -3.2% at 296.2



    Crude Oil Futures

    Down -3.2% at $82.18

    Gold Futures

    Down -2.2% at $1,336.10

    Copper Futures

    Down Sharply -5.3% at $3.7135

    SPI Futures

    Down -1.3% (or -61 pts) at 4,652





    Market

    Movement

    SSE Composite (China)

    Down Sharply -4.0% at 2,895

    Hang Seng Index (Hong Kong)

    Down -1.4% at 23,693

    Nikkei 225 Index (Japan)

    Down -0.3% at 9,797

    ASX News Today

    The SPI Futures is below its key pivot level of 4725 and the ASX is set to open lower as the SPI Futures closed down -1.3% (or -61 pts) at 4,652. The key levels for our index today are 4680 and 4600. M&A activity continues to drive specific stocks. The ASX is set to open lower, led by the miners. Honour your stops or use options o protect your portfolio.

    ALL- Aristocrat Leisure, the embattled gaming machine maker is being sued by a US company alleging patent infringements over Aristocrat’s Viridian poker machines.

    ANZ- ANZ Banking shares rose yesterday on sp{eculation it has failed to win control of Korea Exchange Bank.

    AWB- AWB the grains marketer will meet to seek final shareholders approval to back its takeover by Agrium Inc.

    AXA- AXA Asia Pacific Holdings chairman and four other directors have recommended its shareholders accept the new $13.3 billion bid from wealth manager AMP.

    BHP- BHP Billiton Ltd says the potential returns of its failed bid to take over Canada’s Potash Corporation outweighed the risk of not being in a position to proceed.

    NAB- National Bank sees signs of sustained improvement in the global credit environment, with business credit demand expected to pick up in 2H11.

    OGC- Copper miner OZ Minerals GM Mick Wilkes will exit the company to take the reins at OceanaGold Corp.

    SUN- Suncorp-Metway will sell its Tyndall Investments business to Japan’s Nikko Asset Management for around $128 million.

    TAH- Tabcorp Holdings has completed the final stage of its equity raising, with its retail bookbuild oversubscribed.

    TLS- Draft laws to structurally separate Telstra, which will pave the way for the rollout of the NBN through the structural separation of Telstra, have passed the lower house.

    WEB- Webjet the online travel agent, maintains its earnings guidance for 1H11, and confirms demand for air travel has improved, particularly among business passengers.

    Economic Reports :

    Westpac Indexes of Economic Activity Leading Index for September (estim. +5.3%)
    Skilled Vacancies Index for November
    Labour Price Index for 3Q

    Companies:

    Centro Properties Group (CNP) Full year 2010 AGM
    Cabcharge Australia Ltd (CAB) Full year 2010 AGM
    Murchison Metals Ltd (MMX) Full year 2010 AGM
    Mount Gibson Iron (MGX) Full year 2010 AGM
    West Australian Newspaper (WAN) Q1 2011 Activities Report

    Ex-Dividends

    Soul Pattinson (SOL)
    Whitefield Ltd (WHF)

    Market Summary

    ASX – to open lower
    US & UK/Europe – lower
    US ADRs – Broadly Lower

    BHP down 3.0% &
    RIO up ;
    AWC down 3.9%
    ANZ down 3.1% &
    NAB down 1.9%
    NEM down 2.1%,
    JHX down 5.6%,
    NWS down 1.9%

    Commodities Stock Index down 2.2%
    Gold Stocks Index down 2.8%
    Oil Stocks Index down 2.4%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: U.S. Market Push Higher On Prospect of QE2

    Monday, October 11th, 2010

    Stock Market Analysis

    U.S. Market Push Higher On Prospect of QE2

    U.S. markets ended higher, as a bleak jobs report convinces investors that the Fed will need to introduce quantitative easing (QE2). The US dollar dropped to a 15-year low against the yen on the expectation of QE2. European stocks were mixed Friday, as investors still fear a faltering recovery. Asian markets closed higher led by China. The ASX is set to trade higher today, with the positive lead from the U.S.  Gold prices held around fresh record highs, as the US dollar weakness spurred buying interest in commodities and shares of companies producing them, and in currency trading as the Australian dollar was trading against the U.S. dollar around its highest levels since the currency was allowed to float freely in 1983.

    The SPI Futures is just above the key resistance level of 4700 the ASX is set to open higher the SPI Futures closed up 0.5% (or 22 pts) at 4,717 (up 0.9% for week). The key levels for our index this week are 4800 and 4600. M&A activity continues to drive specific stocks. The ASX will trade higher today, with the positive leads from the China and U.S.  Options volatilty is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    US Markets

    The Dow Jones closed above 11000 on Friday for the first time since May, as a bleak jobs report boosted expectations that the Federal Reserve will move to stimulate economic growth. The index closed above the 11000 level for the first time since 3 May’10, which was on three days before the “flash crash”, which severe to unnerve the markets in the subsequent 6-months. The Non-farm Payrolls report showed a net 95,000 workers lost their jobs in September, a worse-than-expected decline. The private sector added 64,000 jobs, while the unemployment rate remained unchanged at 9.6% in September. Investors pushed the markets higher on the hope the poor jobs data will increase the odds that the Fed will take new steps to jump-start the economy with QE2. Alcoa was the Dow’s biggest gainer, surging 5.7% after kicking off earnings season with results that exceeded analysts expectations and they lifted their forecast for global aluminum demand in 2010.  The Dow has gained 5.5% year-to-date and the S&P 500 is up 4.5% for 2010. The Materials (up 2%), Energy (up 1.3%) and Consumer Discretionary (up 1.1%) sectors leading the way. The Dow closed up 0.5% (or 58 points) at 11,006 (up 1.3% for week), while in the broader market the S&P 500 index up 0.6% (or 7 points) at 1,165 (up 1.4% for week) and the tech-heavy Nasdaq ended up 0.8% (or 18 points) at 2,402 (up 0.9% for week).

    European Markets

    European stocks were mixed Friday, as investors still fear a faltering recovery. Global governments are trying to task the IMF with calming the recent outbreak of tensions over currencies, with fears that they many instigate a protectionist backlash. The U.K. market ended little changed for the week. The European Commission (ECB) has warned that the rising euro could jeopardize recovery in the EU bloc. European markets are still under pressure as investors fear that the austerity measures being pursued by the governments will curb economic growth.  In London the FTSE 100 index closed down marginally -0.1% (or -5 points) at 5,658 (up 1.1% for week), the German DAX up 0.3% (or 15 points) at 6,292 (down -0.1% for week), while in France the CAC was down marginally -0.2% (or -7 points) at 3,763 (up 1.0% for week).

    Asian Markets

    Asian stock markets ended higher Friday.  Chinese stocks jumped for their best percentage gain in more than 4-months, as trading resumed after the week-long Golden Week holiday. Several resource shares traded limit-up , jumping by the 10% daily limit, playing catch up to a recent rally in commodities.  Metal and coal producers jumped higher, helping overcome the early weakness displayed by property developers in the wake of further tightening measures introduced by the government.  The index closed at its highest level in 6-months. Hong Kong stocks finished higher too, while Japanese stocks fell, again led by the exporters.  In China the SSE Composite closed up 3.1% (or 83 points) at 2,739 (up 5.7% for week), while in Hong Kong the Hang Seng Index was up 0.3% (or 60 points) at 22,944 (up 3.7% for week) and in Japan the Nikkei 225 Index was down -1.0% (or -96 points) at 9,589 (up 1.2% for week).

    Commodities

    The Dollar Index down marginally -0.2% at 77.18 on higher Euro, while the Australian Dollar last traded at 98.48.  Commodities were generally higher, with soft commodities traded “limit-up” for the session.

    Gold prices are still around record highs. The benchmark crude NYMEX for September delivery was up 1.2% (or $US0.99) to settle at $US82.84 (up 8.3% for week). Copper prices higher, Copper for September delivery delivery was up 2.5% (or 9.3 cents) at $US3.7770 (up 4.2% for week). Gold prices are around record highs, are around key $US1,350 level, with December gold as up 0.8% at $US1,346.50 (up 3.9% for week).

    Key News International Drivers Today

    US - The Non-farm Payrolls report showed a net 95,000 workers lost their jobs in September.
    EU - Tensions over currencies wars with fears that they many invite a protectionist backlash.
    CHINA – Market plays catch-up. Government stands firm on access to credit.
    JAPAN – Exporters weigh as Yen at 15-years highs.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Up 0.5% (or 58 pts)  at 11,006 (up 1.3% for week)

    The S&P 500

    Up 0.6% (or 7 pts)  at 1,165 (up 1.4% for week)

    The Nasdaq

    Up 0.8% (or 18 pts)  at 2,402 (up 0.9% for week)

    The FTSE 100

    Down  Marginally -0.1% (or -5 pts)  at 5,658 (up 1.1% for week)

    The German DAX

    Up 0.3% (or 15 pts)  at 6,292 (down -0.1% for week)

    The Fench CAC

    Down  Marginally -0.2% (or -7 pts)  at 3,763 (up 1.0% for week)

    The Dollar Index

    Down  Marginally -0.19% at 77.18

    The Australian Dollar

    Last traded at 98.45

    The Commodities Index

    Up 2.72% at 295.1

    Crude Oil Futures

    Up 1.2% at $82.84 (up 8.3% for week)

    Gold Futures

    Up 0.77% at $1,346.50 (up 3.9% for week)

    Copper Futures

    Up 2.53% at $3.7770 (up 4.2% for week)

    SPI Futures

    Up 0.5% (or 22 pts) at 4,717 (up 0.9% for week)

    Market

    Movement

    SSE Composite (China)

    Up 3.1%  at 2,739 (up 5.7% for week)

    Hang Seng Index (Hong Kong)

    Up 0.3%  at 22,944 (up 3.7% for week)

    Nikkei 225 Index (Japan)

    Down -1.0%  at 9,589 (up 1.2% for week)

    ASX News Today<

    The SPI Futures is just above the key resistance level of 4700 the ASX is set to open hiher  the SPI Futures closed up 0.5% (or 22 pts) at 4,717 (up 0.9% for week).  The key levels for our index this week are 4800 and 4600. M&A activity continues to drive specific stocks.  The ASX will trade higher today, with the positive leads from the China and U.S.  Options volatilty is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    AMP- AMP Financial Services and Bendigo Bank have entered into a partnership where Bendigo Bank’s 460 branches will sell AMP life insurance products.

    AWB-  An independent expert Lonergan Edwards & Associates says the propsed Agrim Inc $1.24 billion takeover offer is fair and reasonable and in the best interests of shareholders.

    BHP- BHP expects to pay about $C90 billion in royalties and taxes to local, provincial and federal governments over the multi-decade operating life of its Jansen potash project in Saskatchewan, Canada.

    CFE- Cape Lambert Resources Ltd will buy back 10 percent of the company’s ordinary shares as part of a capital management program.

    LEI- a subsidiary of Leighton Holdings has announced the securing of a contract with resources explorer CGA Mining, to increase production at a major gold mine in the Philippines.

    MND- Monadelphous Group the engineering group, has won contracts worth $120 million for projects in PNG and WA.

    MYR- Myer Holdings the retailer has been through a difficult environment in the past fiscal year, but the outlook is improving.

    NEC- Northern Energy Corporation the coal explorer, has rejected a takeover offer from rival miner New Hope as inadequate, but is willing to keep talking.

    PEM- Perilya the lead and zinc miner, has entered into a binding agreement with Canada’s GlobeStar Mining Corporation as a precursor to a friendly $186 million takeover bid.

    QRL – QR National investors will pay $2.50 to $3 a share to get a slice of Queensland’s rail freight business when it is floated 22 Nov’10.  More than $5 billion could be raised in the float.

    SDL- Sundance Resources the mining explorer, has appointed Sinosteel Midwest Corp. CEO Giulio Casello as its managing director and chief executive.

    RIO- Rio Tinto has not made any final decision regarding the proposed WA iron ore JV with BHP Billiton.

    Economic Reports :

    NAB Business Survey for September
    Housing Finance Housing Finance Approvals for August

    Companies:

    Peak Oil and Gas $110 million IPO

    Ex-Dividends

    Coffey International (COF)
    Cedar Woods Prop. (CWP)
    Integrated Legal (IAW)
    K & S Corporation (KSC)
    Marbletrend Group (MDB)
    Medusa Mining Ltd (MML)
    Money3 Corporation (MNY)
    NRW Holdings Limited (NWH)
    Specialty Fashion (SFH)
    Transmetro Corp. Ltd (TCO)

    Market Summary

    ASX – to open higher
    US & UK/Europe – U.S. Higher, Europe Mixed
    US ADRs –  Broadly Higher

    BHP up 2.2% &

    RIO up 2.0%

    AWC up 5.0%

    ANZ up 0.7% &

    NAB up 1.6%

    NEM down 0.2%

    JHX up 0.8%

    NWS up 1.3%

    Commodities Stock Index up 1.3%
    Gold Stocks Index up 0.6%
    Oil Stocks Index up 1.0%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Gold Backs off Record Levels

    Friday, October 8th, 2010

    Stock Market Analysis

    Gold Backs off Record Levels

    US stocks closed mixed ahead of the jobs report tonight.  European stocks were mixed as the ECB warns that the strong Euro will impact growth going forward.  Asian markets were also mixed, with China closed.  The ASX is set to trade lower today, as profit taking set in on the mining stocks overnight.  Gold prices hit a fresh record high as US dollar weakness spurred buying interest in commodities and shares of companies producing them and in currency trading, the Australian dollar jumped against the U.S. dollar to hit its highest level since the currency was allowed to float freely in 1983 (above 99 U.S. cents).  However there was profit-taking in the commodities in late trading, with Gold showing a possible key day reversal.

    The SPI Futures is just below the key resistance level of 4700 the ASX is set to open lower as the SPI Futures closed down -0.4% (or -17 pts) at 4,684.  The key levels for our index today are 4700 and 4600. M&A activity continues to drive specific stocks.  The ASX will trade lower today, expect profit taking in the miners.  Options volatilty is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    US Markets

    US stocks ended mixed, ahead of the Non-Farm Payrolls Employment report out Friday.  Trading volumes were again subdued.  Falling stocks were led by the Miners (down 1%) and the Energy and Financials sectors down over 0.4%. The Dow closed down marginally -0.2% (or -19 points) at 10,949, while in the broader market the S&P 500 index down marginally -0.2% (or -2 points) at 1,158 and the tech-heavy Nasdaq ended up marginally 0.1% (or 3 points) at 2,384.

    European Markets

    European stock markets closed mixed overnight, with the euro soaring to fresh 8-month highs above $US1.40. The European Commission (ECB) has warned that the rising euro could jeopardise recovery in the EU bloc.  In the U.K. the market closed lower on the back of profit-taking in the miners, also the Bank of England (BoE) says it will maintain its emergency stimulus plan and left its interest rates unchanged at record levels.  In London the FTSE 100 index closed down -0.3% (or -19 points) at 5,662, the German DAX up marginally 0.1% (or 6 points) at 6,276, while in France the CAC was up marginally 0.2% (or 6 points) at 3,770.

    Asian Markets

    Asian equity markets ended mixed.  Japanese benchmark indexes fluctuated during the session, caught between strength in real estate and banking companies and weakness in exporters. The Japanese yen jumped to a fresh 15-year high versus the greenback, so investors are expecting the government to again intervene in the currency market if the yen stays strong.  Hong Kong’s market ended little changed after closing at a 10-month high Wednesday.  Chinese markets remained closed for the Golden Week holiday. In China the SSE Composite closed at 2,656 , while in Hong Kong the Hang Seng Index was flat at 22,884 and in Japan the Nikkei 225 Index was down marginally -0.1% (or -7 points) at 9,685.

    Commodities

    The Dollar Index up marginally 0.1% at 77.45 on higher Euro, while the Australian Dollar last traded at 97.58.  Commodities were generally lower.

    Gold prices are still around record highs. The benchmark crude NYMEX for September delivery was down -2.1% (or $US-1.74) to settle at $US81.49. Copper prices lower, Copper for September delivery delivery was down -2.2% (or -8.3 cents) at $US3.6630. Gold prices are around record highs, are around key $US1,350 level, with December gold was down -0.8% at $US1,335.20.

    Key News International Drivers Today

    US - Private sector jobs in the U.S. unexpectedly dropped last month.
    EU - German August factory orders increased almost four times the pace economists forecast.
    CHINA – Market closed yesterday. Government stands firm on access to credit.
    JAPAN – BoJ unexpectedly cuts interest rates to “virtually zero”.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Down  Marginally -0.2% (or -19 pts)  at 10,949

    The S&P 500

    Down  Marginally -0.2% (or -2 pts)  at 1,158

    The Nasdaq

    Up  Marginally 0.1% (or 3 pts)  at 2,384

    The FTSE 100

    Down -0.3% (or -19 pts)  at 5,662

    The German DAX

    Up  Marginally 0.1% (or 6 pts)  at 6,276

    The Fench CAC

    Up  Marginally 0.2% (or 6 pts)  at 3,770

    The Dollar Index

    Up  Marginally 0.08% at 77.45

    The Australian Dollar

    Last traded at 97.58

    The Commodities Index

    Down -0.64% at 287.3

    Crude Oil Futures

    Down -2.1% at $81.49

    Gold Futures

    Down -0.83% at $1,335.20

    Copper Futures

    Down -2.22% at $3.6630

    SPI Futures

    Down -0.4% (or -17 pts) at 4,684

    Market

    Movement

    SSE Composite (China)

    Closed at 2,656

    Hang Seng Index (Hong Kong)

    Flat  at 22,884

    Nikkei 225 Index (Japan)

    Down  Marginally -0.1%  at 9,685

    ASX News Today

    he SPI Futures is just below the key resistance level of 4700 the ASX is set to open lower as the SPI Futures closed down -0.4% (or -17 pts) at 4,684. The key levels for our index today are 4700 and 4600. M&A activity continues to drive specific stocks. The ASX will trade lower today, expect profit taking in the miners.  Options volatilty is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    AMP- AMP Financial Services and Bendigo Bank have entered into a partnership where Bendigo Bank’s 460 branches will sell AMP life insurance products.

    AWB- The Supreme Court of Victoria has approved shareholders to vote on Canada-based Agrium Inc proposed $1.24 billion takeover of AWB.

    BDR- Beadell Resources the junior gold explorer, has announced further high grade drill results from its Tucano gold project in Brazil.

    BOQ- Bank of Queensland will launch an online share trading service with broker CMC Markets Stockbroking early next year.

    CFE- Cape Lambert Resources Ltd will buy back 10 percent of the company’s ordinary shares as part of a capital management program.

    GDO- Gold One International the gold miner, has received approval for a $66.5 million loan facility from Absa Capital and BNP Paribas.

    LEI- Leighton Holdings subsidiary John Holland has won a $348 million contract to provide mining services to the Jellinbah coal mine in central Queensland.

    MND- Monadelphous Group the engineering group, has won contracts worth $120 million for projects in PNG and WA.

    NHF- NIB Holdings the private health insurer, hopes that members of takeover target GMHBA will pressure its board to seriously consider NIB’s $140 million offer.

    PEM- Perilya the lead and zinc miner, has entered into a binding agreement with Canada’s GlobeStar Mining Corporation as a precursor to a friendly $186 million takeover bid.

    RIO- Rio Tinto has not made any final decision regarding the proposed WA iron ore JV with BHP Billiton.

    Economic Reports :
    Official Reserve Assets Reserve for September
    AFOM to issue $700 million of May 2013 bonds.

    Companies:

    Commonwealth Property Office Full year 2010 AGM

    Ex-Dividends

    Cromwell Group (CMW)
    Industrea Limited (IDL)
    Matrix C & E Ltd (MCE)
    National Can Ind Ltd (NCI)
    United Overseas Aust (UOS)

    Market Summary

    ASX – to open lower
    UK/Europe – Lower
    US ADRs –  Broadly Lower

    BHP down 0.4% &

    RIO down 1.2%

    AWC up 1.2%

    ANZ up 0.8% &

    NAB down 0.1%

    NEM down 2.6%

    JHX down 2.5%

    NWS up 0.3%

    Commodities Stock Index down 0.8%
    Gold Stocks Index down 2.8%
    Oil Stocks Index down 0.2%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Markets Mixed as Gold Shines

    Thursday, October 7th, 2010

    Stock Market Analysis

    Markets Mixed as Gold Shines

    US stocks closed mostly lower after a disappointing report on the jobs market renewed concern about the US economy. European stocks rose on positive German industry data. Asian markets rose. Gold shares around the Asia rallied after spot gold hit a new record high. The ASX is set to trade flat to higher today ahead of the release of our jobs report.

    The SPI Futures is just above the key resistance level of 4700 the ASX is set to open higher as the SPI Futures closed up marginally 0.2% (or 8 pts) at 4,707. The key levels for our index today are 4750 and 4650. M&A activity continues to drive specific stocks. The ASX will trade flat to higher today but will be impacted by today’s  employment report, as the Australian Bureau of Statistics (ABS) is scheduled to release labour force data for September. Gold stocks continue to be in focus. Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    US Markets

    US stocks ended mixed, ahead of the Non-Farm Payrolls Employment report out Friday. Overnight data showed the number of private sector jobs in the U.S. unexpectedly dropped last month for the first time in seven months (by 39,000), pointing to continued labor-market weakness. Trading volumes were again subdued.  Falling stocks narrowly outpaced rising ones on the NYSE. Economically sensitive sectors including materials, energy and industrial led to the upside, rising over 0.6%, while declines in defensive areas including telecoms, health care and utilities weighed on the indices. The Dow closed up marginally 0.2% (or 23 points) at 10,968, while in the broader market the S&P 500 index down marginally -0.1% (or -1 points) at 1,160 and the tech-heavy Nasdaq ended down -0.9% (or -20 points) at 2,379.

    European Markets

    European stocks rose on positive German industry data. Investors are speculating that the central banks will work to take action to boost the faltering economic recovery as necessary. Miners advanced as metal prices rose, while investors ignored another downgrade for Ireland’s debt and weaker-than-expected jobs data in the U.S. In the U.K. the market was led higher by the mining and banking sectors. German stocks rose on the back of a report that showed German August factory orders increased almost four times the pace economists forecast, led by demand for investment goods such as machinery.  In London the FTSE 100 index closed up 0.8% (or 46 points) at 5,681, the German DAX up 0.9% (or 55 points) at 6,271, while in France the CAC was up 0.9% (or 33 points) at 3,764.

    Asian Markets

    Asian markets rose.  In Japan investor sentiment improved as additional monetary easing by the Bank of Japan showed the BoJ is prepared to act to support the economy. Gold miners rose around the Asian region after bullion prices surged to new highs and real estate companies also gained in Japan. Hong Kong stocks rose, while Chinese markets were closed for a public holiday. In China the SSE Composite was closed  at 2,656, while in Hong Kong the Hang Seng Index was up 1.1% (or 241 points) at 22,880 and in Japan the Nikkei 225 Index was up 1.8% (or 173 points) at 9,691.

    Commodities

    The Dollar Index down -0.5% at 77.39 on higher Euro, while the Australian Dollar last traded higher at 96.94. Commodities were generally higher.

    Gold prices are still around record highs. The benchmark crude NYMEX for September delivery was up 0.4% (or $US0.35) to settle at $US83.17. Copper prices rose, Copper for September delivery Copper for September delivery delivery was up 0.8% (or 2.9 cents) at $US3.7480. Gold prices are around record highs, are around key $US1,350 level, with December gold was up 0.6% at $US1,347.00.

    Key News International Drivers Today

    US - Private sector jobs in the U.S. unexpectedly dropped last month.
    EU - German August factory orders increased almost four times the pace economists forecast.
    CHINA – Market closed yesterday. Government stands firm on access to credit.
    JAPAN – BoJ unexpectedly cuts interest rates to “virtually zero”.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Up  Marginally 0.2% (or 23 pts)  at 10,968

    The S&P 500

    Down  Marginally -0.1% (or -1 pts)  at 1,160

    The Nasdaq

    Down -0.9% (or -20 pts)  at 2,379

    The FTSE 100

    Up 0.8% (or 46 pts)  at 5,681

    The German DAX

    Up 0.9% (or 55 pts)  at 6,271

    The Fench CAC

    Up 0.9% (or 33 pts)  at 3,764

    The Dollar Index

    Down -0.46% at 77.39

    The Australian Dollar

    Last traded at 96.94

    The Commodities Index

    Up 0.25% at 289.2

    Crude Oil Futures

    Up 0.4% at $83.17

    Gold Futures

    Up 0.60% at $1,347.00

    Copper Futures

    Up 0.78% at $3.7480

    SPI Futures

    Up  Marginally 0.2% (or 8 pts) at 4,707

    Market

    Movement

    SSE Composite (China)

    Up 1.7%  at 2,656

    Hang Seng Index (Hong Kong)

    Up 1.1%  at 22,880

    Up 1.8%  at 9,691


    ASX News Today

    The SPI Futures is just above the key resistance level of 4700 the ASX is set to open higher as the SPI Futures closed up marginally 0.2% (or 8 pts) at 4,707. The key levels for our index today are 4750 and 4650. M&A activity continues to drive specific stocks.  The ASX will trade flat to higher today but will be impacted by today’s  employment report, as the Australian Bureau of Statistics (ABS) is scheduled to release labour force data for September.  Gold stocks continue to be in focus. Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    AMP- AMP Financial Services and Bendigo Bank have entered into a partnership where Bendigo Bank’s 460 branches will sell AMP life insurance products.

    CQT- Conquest Mining the mining explorer, has released further drilling results from a high-grade eastern extension to its V2 deposit at the Mt Carlton mine site near Townsville in Queensland.

    FMG- Fortescue the iron ore miner, has been ordered to pay $3.8 million in a dispute with Armada (Singapore) Pte Ltd over a canceled shipping contract.

    LCM- Logicams the engineering services provider, has won a $5.4 million contract with Rio Tinto Iron Ore for train loading improvement project in WA’s Pilbara region.

    LEI- Leighton’s Asian arm has joined a JV to develop a new $660 million sewerage sludge treatment facility in Hong Kong.

    PXS- Pharmaxis Ltd, which develops treatments for respiratory and autoimmune diseases, has won regulatory approval to sell its asthma test kit, Aridol, in the U.S.

    RIO- Rio Tinto has not made any final decision regarding the proposed WA iron ore JV with BHP Billiton.

    SGP- Stockland is in the final process of buying Aevum, the retirement village operator.

    SPN- SP AusNet the electricity and gas provider, has confirmed a 15-20 percent improvement in net profit after tax in 1H11, due to a favorable tax position.

    SRX- Sirtex Medical the cancer drug maker, has sold a record number of doses in the 1Q of financial 2011 following strong sales during FY10.

    Economic Reports :

    SEEK Employment Index for September
    Australian PCI for September
    Unemployment Report (est 5.1%)
    AFOM is set to issue $600 million 21 Jan’10 Treasury notes.

    Companies:

    Broadvector Ltd is scheduled to list on the ASX.

    Ex-Dividends

    Aus Gov Index Fund (AQF)
    Gerard Lighting (GLG)
    OrotonGroup Limited (ORL)
    Toll Holdings Ltd (TOL)

    Market Summary

    ASX – to open higher
    US & UK/Europe – Higher
    US ADRs –  Broadly Higher

    BHP up 2.4% &

    RIO up 2.7%

    AWC up 2.2%

    ANZ up 1.0% &

    NAB up 0.6%

    NEM up 1.7%

    JHX up 4.3%

    NWS up 0.5%

    Commodities Stock Index up 1.0%
    Gold Stocks Index up 1.5%
    Oil Stocks Index up 0.8%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Markets Surge on Positive ISM Data

    Wednesday, October 6th, 2010

    Stock Market Analysis

    Markets Surge on Positive ISM Data

    US stocks surged to their highest level in five months overnight, after an ISM report shows activity in American services companies powered ahead in September. European shares finished higher, breaking a six-session losing streak. Asian stock markets ended higher, as the Bank of Japan (BoJ) boosted sentiment unexpectedly cut interest rates to “virtually zero”. The ASX will trade higher after the positive leads from overseas and the RBA surprise decision to leave interest rates on hold.

    The SPI Futures is just below the key resistance level of 4700 the ASX is set to open higher as the SPI Futures closed up 1.4% (or 63 pts) at 4,691. The key levels for our index today are 4750 and 4650. M&A activity continues to drive specific stocks.  The ASX will trade higher after the positive leads from overseas and the RBA surprise decision to leave interest rates on hold.  Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    US Markets

    U.S. stocks rallied to 5-month highs. Investor optimism came ahead of some key earnings and jobs data later this week, with the Dow component Alcoa kicking off the reporting season on Thursday and Non-Farm Payrols monthly jobs report due Friday. Sentiment was boosted by encouraging services sector data and speculation that global central banks will follow Japan’s lead in stimulating economic growth, as the BoJ cuts its rates to “virtually zero”.  The U.S. services sector expanded at a better-than-expected pace in September according to the Institute for Supply Management (ISM). The ISM report which covers 90 percent of the world’s largest economy rose to 53.2 (from 51.5). The surge is stocks was broad-based led by the materials, industrials, energy and financial sectors all up over 2.3 percent.  The Dow closed up 1.8% (or 193 points) at 10,945, while in the broader market the S&P 500 index up 2.1% (or 24 points) at 1,161 and the tech-heavy Nasdaq ended up 2.4% (or 55 points) at 2,400.

    European Markets

    European shares finished higher, breaking a six-session losing streak. Investor sentiment was bouyed after a surprise interest rate cut by the Bank of Japan (BoJ), heightened expectations that central banks will continue to do all they can to support growth, as the ECB is due to meet  this week. The U.K. market gained the most in 2-weeks and continues to outperform,  while in Germany the market gained for the first day in seven, breaking its worst losing streak since January.  In London the FTSE 100 index closed up 1.4% (or 80 points) at 5,636, the German DAX up 1.3% (or 82 points) at 6,216, while in France the CAC was up 2.3% (or 82 points) at 3,731.

    Asian Markets

    Asian stock markets ended higher. The Bank of Japan (BoJ) boosted sentiment as it unexpectedly announced it will buy more bonds and cut its key overnight call interest rate to “virtually zero”, saying its rates are to remain this low until prices begin to stabilize from deflationary pressures. The Japanese market, led by the financials sector, was the best performer in the region. In Hong Kong sales of homes declined 41 percent in September after the government’s implementation of tightening measures. Also in China the government may look to restrict exports of phosphate-based fertilizers after record shipments in July and August reduced domestic inventories. In China the SSE Composite closed up 1.7% (or 45 points) at 2,656, while in Hong Kong the Hang Seng Index was down marginally 0.1% (or 20 points) at 22,639 and in Japan the Nikkei 225 Index was up 1.5% (or 138 points) at 9,519.

    Commodities

    The Dollar Index down -0.8% at 77.80 on higher Euro, while the Australian Dollar last traded lower at 95.42. Commodities were generally higher.

    Gold prices are still around record highs. The benchmark crude NYMEX for September delivery was up 1.4% (or $US1.14) to settle at $US82.61. Copper prices rose, Copper for September delivery Copper for September delivery was down -0.3% (or -1.3 cents) at $US3.6450. Gold prices are around record highs, are around key $US1,350 level, with December gold was up 1.9% at $US1,339.80.

    Key News International Drivers Today

    US – Investor optimism came ahead of some key earnings and jobs data later this week.
    EU – Investors optimistic ahead of the BoE and ECB meetings this week.
    CHINA – Market closed yesterday. Government stands firm on access to credit.
    JAPAN – BoJ unexpectedly cuts interest rates to “virtually zero”.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Up 1.8% (or 193 pts)  at 10,945

    The S&P 500

    Up 2.1% (or 24 pts)  at 1,161

    The Nasdaq

    Up 2.4% (or 55 pts)  at 2,400

    The FTSE 100

    Up 1.4% (or 80 pts)  at 5,636

    The German DAX

    Up 1.3% (or 82 pts)  at 6,216

    The Fench CAC

    Up 2.3% (or 82 pts)  at 3,731

    The Dollar Index

    Down -0.83% at 77.80

    The Australian Dollar

    Last traded at 95.42

    The Commodities Index

    Up 1.56% at 288.4

    Crude Oil Futures

    Up 1.4% at $82.61

    Gold Futures

    Up 1.85% at $1,339.80

    Copper Futures

    Down -0.34% at $3.6450

    SPI Futures

    Up 1.4% (or 63 pts) at 4,691

    Market

    Movement

    SSE Composite (China)

    Up 1.7%  at 2,656

    Hang Seng Index (Hong Kong)

    Down  Marginally 0.1%  at 22,639

    Nikkei 225 Index (Japan)

    Up 1.5%  at 9,519

    ASX News Today

    BHP- Canadian authorities have extended their review of BHP’s $US39 billion takeover offer for Potash Corp.

    BTU- Bathurst Resources is planning a capital raising of up to $110 million to develop its Buller coking coal project in NZ.

    CEY- Banpu Minerals of Thialand, has extended the date of its $2.4 billion takeover bid for Centennial Coal by one week and declared the offer final.

    CLO- Clough has won a contract worth $54 million to construct topsides for a LNG condensate offloading jetty near Port Moresby in PNG.

    CXY- Cogar Energy the underground coal gasification (UCG) company, has raised $1.15 million through a New York investment firm, after warning investors last month it may be unable to continue as a going concern.

    LEI- A subsidiary of Leighton Holdings Ltd has been awarded a capital works project worth $295 million in Abu Dhabi.

    LNC- Linc Energy Ltd has signed a memorandum of understanding (MOU) with German research centre GFZ to develop carbon capture and storage (CCS) technology for the company’s underground coal gasification (UCG) operations.

    PAX- Panax Geothermal is optimistic its Salamander-1 well in South Australia’s Otway Basin could be developed into a geothermal energy production well.

    SPN- SP AusNet the electricity and gas provider, has confirmed a 15-20 percent improvement in net profit after tax in 1H11, due to a favorable tax position.

    SPH- Sphere Minerals the West Africa-focused iron ore mine developer, has not received an alternative takeover offer to a recommended bid from Xstrata.

    TSE- Transfield Services has secured $1.1 billion of work in the first quarter of the current financial year, including  milestone contracts with BHP and Caltex Australia Ltd.

    UNX- Uranex will undertake a fully underwritten rights issue in the next month and has resolved to focus on its Mkuju uranium project in Tanzania.

    UXC- UXC the Melbourne-based IT services business has been selected to provide a lifestyle and entertainment system for workers on Chevron Australia’s Gorgon gas project in WA.

    WEB- Webjet increased the value of transactions it processes by 24 percent during the September quarter.

    Economic Reports :

    DEEWR Leading Indicator of Employment Leading indicator of Employment for October
    SEEK Employment Index for September
    AOFM auction to issue $500 million of April 2020 bonds.

    Companies:

    Medusa Mining Ltd  Full year 2010 AGM
    Kagera Nickel Ltd and West Peak Iron Ltd are due to list on the ASX today

    Ex-Dividends

    Gowing Bros. Limited (GOW)
    Kresta Holdings (KRS)

    Market Summary

    ASX – to open higher

    US & UK/Europe – Higher
    US ADRs –  Broadly HigherBHP up 2.4% &

    RIO up 3.6%

    a id=”b4k6v” href=”http://www.traderdealer.com.au/fundamentals/AWC” target=”_blank”>AWC up 2.4%

    ANZ up 2.6% &

    NAB up 2.5%

    NEM up 1.5%

    JHX up 1.6%

    NWS up 2.9%

    Commodities Stock Index up 2.3%
    Gold Stocks Index up 3.5%
    Oil Stocks Index up 2.4%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Central Banks to Decide Fate of Markets

    Tuesday, October 5th, 2010

    Stock Market Analysis

    Central Banks to Decide Fate of Markets

    Markets drifted lower ahead of a busy week for economic data. Markets are due for a pullback after last month’s spectacular performance as Central Banks meet this week in England (BoE), Europe (ECB), Japan (BoJ) and Australia (RBA). U.S. markets closed lower across the board as Miners and Energy sectors weighed on the indices.  Asian markets were mixed, while European markets drifted lower and the ASX will trade cautiously ahead of the RBA decision this afternoon.

    The SPI Futures is just above the key resistance level of 4600 the ASX is set to open lower as the SPI Futures closed down -0.5% (or -24 pts) at 4,614. The key levels for our index today are 4650 and 4550. M&A activity continues to drive specific stocks. The ASX will trade cautiously ahead of the RBA decision today. The RBA is expected to hike interest rates today, but banks are likely to increase mortgage rates in excess of the expected hike. Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    US Markets

    US markets closed down ahead of the start of the earnings reporting season later this week. Economic reports showed factory orders fell slightly more than expected in August and contracts for new homes remained weak and far below last year’s pace. The markets were weak across all sectors, but  Miners and Energy sectors weighed heavily, down over 1.3 percent. Three stocks fell for every one that rose on the NYSE. The Dow closed down -0.7% (or -78 points) at 10,751, while in the broader market the S&P 500 index down -0.8% (or -9 points) at 1,137 and the tech-heavy Nasdaq ended down -1.1% (or -27 points) at 2,344.

    European Markets

    European stock markets closed overnight. Investors were cautious ahead of the BoE and ECB meetings this week. U.K. stocks fell for a third day in the past week, weighed down by the miners.  German stocks were lower led by the banks.  In London the FTSE 100 index closed down -0.7% (or -37 points) at 5,556, the German DAX down -1.2% (or -77 points) at 6,134, while in France the CAC was down -1.2% (or -43 points) at 3,649.

    Asian Markets

    Asian stock markets ended mixed. Japanese shares fell as the yen once again rallied against the U.S. dollar. Asian stocks ended mixed. Japanese stocks closed lower, led by banking shares, as the BoJ meets this week.  Chinese markets were closed for a public holiday, while Hong Kong shares rose. In China the SSE Composite closed up 1.7% (or 45 points) at 2,656, while in Hong Kong the Hang Seng Index was up 1.2% (or 260 points) at 22,619 and in Japan the Nikkei 225 Index was down -0.3% (or -23 points) at 9,381.

    Commodities

    The Dollar Index up 0.5% at 78.45 on lower Euro, while the Australian Dollar last traded at 96.52.  Commodities were generally lower.

    Gold prices are still around record highs. The benchmark crude NYMEX for September delivery was up higher to settle at $US81.61. Copper prices fell, Copper for September delivery Copper for September delivery was down -0.7% (or -2.6 cents) at $US3.6575. Gold prices are around record highs, are around key $US1,300 level, with December gold was down marginally -0.1% at $US1,314.70.

    Key News International Drivers Today

    US – closed down ahead of the start of the earnings reporting season later this week.
    EU – Investors were cautious ahead of the BoE and ECB meetings this week.
    CHINA – Market closed yesterday. Government stands firm on access to credit.
    JAPAN – Japanese shares fell as the yen once again rallied.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Down -0.7% (or -78 pts)  at 10,751

    The S&P 500

    Down -0.8% (or -9 pts)  at 1,137

    The Nasdaq

    Down -1.1% (or -27 pts)  at 2,344



    The FTSE 100

    Down -0.7% (or -37 pts)  at 5,556

    The German DAX

    Down -1.2% (or -77 pts)  at 6,134

    The Fench CAC

    Down -1.2% (or -43 pts)  at 3,649



    The Dollar Index

    Up 0.46% at 78.45

    The Australian Dollar

    Last traded at 96.52

    The Commodities Index

    Down -0.60% at 284.0



    Crude Oil Futures

    Up  Marginally 0.0% at $81.61

    Gold Futures

    Down  Marginally -0.11% at $1,314.70

    Copper Futures

    Down -0.71% at $3.6575

    SPI Futures

    Down -0.5% (or -24 pts) at 4,614





    Market

    Movement

    SSE Composite (China)

    Up 1.7%  at 2,656

    Hang Seng Index (Hong Kong)

    Up 1.2%  at 22,619

    Nikkei 225 Index (Japan)

    Down -0.3%  at 9,381

    SPI: Around key Level 4600 – SPI down -0.5%  at 4,614

    ASX News Today

    The SPI Futures is just above the key resistance level of 4600 the ASX is set to open lower as the SPI Futures closed down -0.5% (or -24 pts) at 4,614. The key levels for our index today are 4650 and 4550. M&A activity continues to drive specific stocks. The ASX will trade cautiously ahead of the RBA decision today.  The RBA is expected to hike interest rates today, but banks are likely to increase mortgage rates in excess of the expected hike. Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    AIO- Asciano Group has secured a 10 year coal haulage contract with Centennial Coal worth about $550 million.

    ANZ- ANZ Bank will need to raise around $1.6 billion through an equity raising if it moves to buy a 57% stake in Korea Exchange Bank.

    AWB- Agrium Inc has received clearance from the Australian FIRB for the AWB Ltd $1.24 billion takeover.

    BHP- BHP and RIO. The Senate has ordered the Federal Government to release assumptions used in estimating the MMRT revenue projections.

    FMG- Fortescue says it loaded more ships and exported more iron ore in September than in any other month in its two-and-half year production history.

    GXY- Galaxy the emerging lithium producer, will raise $30 million from a Chinese investor to ramp up operations at its Mt Cattlin mine in WA and processing plant at Jiangsu in China.

    IVA- Ivanhoe Australia has completed the acquisition of the Osborne copper and gold project in Queensland from Canada’s Barrick Gold Corporation, the largest gold miner in the world.

    MAP- MAp Group says its foreign ownership level has fallen to 38.2 percent from 39.1 percent.

    SPH- Sphere Minerals share rose amid speculation a Singapore-based company is set to launch another bid  rival Xstrata’s takeover offer.

    SPN- SP AusNet the electricity and gas provider, has confirmed a 15-20 percent improvement in net profit after tax in 1H11, due to a favorable tax position.

    WEB- Webjet increased the value of transactions it processes by 24 percent during the September quarter.

    Economic Reports :

    RBA Interest Rate Decision for October
    Australian PSI for September
    ANZ Job Ads for September
    VFACTS vehicle sales for September
    Retail Trade for August
    International Trade in Goods & Services for August

    Companies:
    Metaliko Resources Ltd and New Horizon Minerals Ltd are due to list today.

    Ex-Dividends
    David Jones Limited (DJS)
    Greencross Limited (GXL)
    Premier Investments (PMV)

    Market Summary
    ASX – to see profit-taking
    US & UK/Europe – Lower
    US ADRs–  Broadly Lower

    BHP down 1.8% &

    RIO down 2.1%;

    AWC down 1.5%

    ANZ down 1.1% &

    NAB up 0.3%

    NEM down 1.5%

    JHX down 0.3%

    NWS down 1.4%

    Commodities Stock Index down 1.8%
    Gold Stocks Index down 1.6% Oil Stocks Index down 1.3%

    By Michael Hevern
    Head of Research

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    Stock Market Analysis: Financials Lead Markets Lower

    Tuesday, September 28th, 2010

    Stock Market Analysis

    Financials Lead Markets Lower

    U.S. stocks eased after their surge last Friday with Financials leading the pullback. European markets were cool on worries over the financial health of European banks. Asian stock markets ended higher as they played catchup with Wall Street’s Friday session. Commodities gave back some of their recent gains as the US dollar bounced and the ASX is expected to drift lower today.

    The SPI Futures is just below the key resistance level of 4700 and the ASX is set to open lower as the SPI Futures closed down -0.4% (or -18 pts) at 4,686. The key levels for our index today are 4700 and 4600. M&A activity continues to drive specific stocks and the ASX will trade lower today. We are at the end of the dividend period, which has been supporting our market in the past month. Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    US Markets

    U.S. stocks eased after their surge last Friday, Financials led the pullback. U.S. stocks faded into the close. Another round of corporate deal making pushed the markets higher early on, however the financial sector dragged the indices lower on the close. Citigroup traded lower as the U.S. Treasury may miss its end of year deadline to sell its shares in the company. The US dollar bounced off its April lows against the euro, as traders bet that any Fed quantitative easing to kickstart slowing growth, will be measured.  M&A activity included Wal-Mart and Southwest Airlines announcing acquisition plans. The Dow closed down -0.4% (or -48 points) at 10,812, while in the broader market the S&P 500 index down -0.6% (or -7 points) at 1,142 and the tech-heavy Nasdaq ended down -0.5% (or -11 points) at 2,370.

    European Markets

    European stock markets ended lower as worries simmered over the financial health of European banks.  European markets gave back early gains as investors started to book their gains for the month/quarter. M&A activity included Unilever the consumer products manufacturer saying it will buy U.S. based Alberto Culver Co. for $US3.7 billion in cash. In London the FTSE 100 index closed down -0.5% (or -25 points) at 5,573, the German DAX down -0.3% (or -19 points) at 6,279, while in France the CAC was down -0.4% (or -16 points) at 3,766.

    Asian Markets

    Asian stock markets ended higher, chasing Wall Street’s Friday performance. Even in Japan the stocks rose with exporters and resource stocks leading the market higher. The bulls stepped in China and Hong Kong markets which both returned from holidays. Resource shares were broadly higher across the region as commodity prices rose. In China, PetroChina rose 1.3%,  Chalco gained 2.5% and Jiangxi Copper jumped 5.2%, though property developers in China fell after the government announced its latest measures to curb the nation’s hot property market. In China the SSE Composite closed up 1.4% (or 36 points) at 2,628, while in Hong Kong the Hang Seng Index was up 1.0% (or 221 points) at 22,341 and in Japan the Nikkei 225 Index was up 1.4% (or 13147 points) at 9,603.

    Commodities

    The Dollar Index is up marginally 0.1% at 79.47 on lower Euro, while the Australian Dollar last traded higher at 95.75. Commodities were generally lower.

    Gold prices are still around record highs. The benchmark crude NYMEX for September delivery was down -0.4% at $US76.21. Copper prices lower, Copper for September delivery was down -0.6% at $US3.5915. Gold prices are around record highs, are around key $US1,250 level, with December gold was flat at $US1,296.60.

    Key News International Drivers Today

    US – Another round of corporate deal making failed to hold markets higher.
    EU – A survey of purchasing managers (PMI) pointed to a sharp slowdown in euro-zone growth.
    CHINA – Ended higher, chasing Wall Street’s Friday performance. Government stands firm on access to credit.
    JAPAN – Ended higher, chasing Wall Street’s Friday performance.

    Markets Overview

    Market

    Movement

    The Dow Jones Industrial Average

    Down -0.4% (or -48 pts)  at 10,812

    The S&P 500

    Down -0.6% (or -7 pts)  at 1,142

    The Nasdaq

    Down -0.5% (or -11 pts)  at 2,370

    The FTSE 100

    Down -0.5% (or -25 pts)  at 5,573

    The German DAX

    Down -0.3% (or -19 pts)  at 6,279

    The Fench CAC

    Down -0.4% (or -16 pts)  at 3,766

    The Dollar Index

    Up  Marginally 0.10% at 79.47

    The Australian Dollar

    Last traded at 95.75

    The Commodities Index

    Up  Marginally 0.18% at 284.1

    Crude Oil Futures

    Down -0.4% at $76.21

    Gold Futures

    Up  Marginally 0.05% at $1,296.60

    Copper Futures

    Down -0.55% at $3.5915

    SPI Futures

    Down -0.4% (or -18 pts) at 4,686

    Market

    Movement

    SSE Composite (China)

    Up 1.4%  at 2,628

    Hang Seng Index (Hong Kong)

    Up 1.0%  at 22,341

    Nikkei 225 Index (Japan)

    Up 1.4%  at 9,603

    SPI: Near key Level 4700 – SPI down -0.4% at 4,686

    ASX News Today

    The SPI Futures is just below the key resistance level of 4700 the ASX and is set to open lower as the SPI Futures closed down -0.4% (or -18 pts) at 4,686. The key levels for our index today are 4700 and 4600. M&A activity continues to drive specific stocks. The ASX will trade lower today.  We are at the end of the dividend period, which has been supporting our market in the past month. Options volatility is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.

    ANZ- ANZ Banking expansion into China continues with plans to set up a Chinese language centre in support of the Chinese operations there.

    CFX- CFS Retail Property Trust has completed its $540 million equity sale enabling its purchase of four Direct Factory Outlet (DFO) centres.

    CHC- Charter Hall Group is to acquire a new $75 million Woolworths distribution centre in Tasmania.

    CQT- Conquest Mining has gained control of over 50 percent of North Queensland Metals after rival Heemskirk Consolidated allowed its offer to lapse.

    CRG- Crane Group the plumbing supplier, will acquire full ownership of home building supplier Hudson Building Supplies Pty Ltd for $31.5 million.

    GNS- Gunns is to “transition” its Hinman, Wright & Manser division to Hazell Bros as existing projects are completed.

    KCN- Kingsgate Consolidated the gold miner, says production for the September quarter will be lower than the average for financial 2010 due to maintenance, lower grades and heavy rain.

    LNG- Gas companies LNG and Metgasco (MEL) have agreed to jointly study the feasibility of project converting gas to LNG at Gladstone in Queensland.

    MMX- Murchinson Metals the junior iron ore miner is in a trading halt pending an announcement from the company.  Shares down 10.2%.

    NUF- Nufarm the ag chemicals supplier, has secured waivers on its banking covenants in respect to the periods ending 31 Jul’10 and 30 Oct’10.

    LEI- Leighton Holdings has won an $800+ million contract from Chevron Australia to deliver the civil and underground works for the Gorgon gas project in WA.

    SXE- Southern Cross Electrical Engineering is in talks with Leighton Holdings to provide the underground electrical and instrumentation services for the mining contractor’s Gorgon gas contract in WA. Shares rose 14.6%.

    VBA -  Virgin Blue says its airport check-in and boarding systems are back online, but delays continue.

    WES-Wesfarmers with the Bunnings hardware chain, will increase its investment in NSW by $600+ million in establishing 18 new stores in the next 3-years.

    Economic Reports :

    Parliament reconvenes

    Companies:

    Nufarm (NUF) Full year results
    AVEXA AGM meeting

    Ex-Dividends
    Seymour Whyte Ltd (SWL)

    Market Summary

    ASX – to open Lower US & UK/Europe – Lower
    US ADRs – Broadly Lower

    BHP down 0.4% &

    RIO down 0.4%;

    AWC up 0.6%

    ANZ up 1.8% &

    NAB up 0.6%

    NEM down 1.2%,

    JHX down,

    NWS down 1.2%

    Commodities Stock Index down 0.5%
    Gold Stocks Index down 0.9% Oil Stocks Index down 0.3%

    By Michael Hevern
    Head of Research

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