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Stock Market Analysis: Markets Drift Higher On Succesful EU Debt Auctions

Friday, January 20th, 2012

* US stock markets continued to gain overnight, ending at 6-month highs, as corporate earnings, jobs data and bank earnings reports kept stocks moving higher.
* European stock markets rose overnight, as the financials sector led the gains after successful Spanish and French debt auctions.
* Asian stock markets pushed higher yesterday, after the International Monetary Fund (IMF) said it planned to boost its lending resources and China moved to ease.
* Commodities prices traded mostly lower, as Gold prices lower to around $US1,654 and while crude-oil closed down around $US100.

The SPI Futures is trading below the key pivot level of 4180, ended up 0.7% (or 29 points) at 4,226. The key levels for our index today are 4180 to 4280.

Australian shares have trimmed their early gains after the jobs numbers showed unemployment remained steady. Investor sentiment started the day buoyed by news that the IMF may raise $US1 trillion in additional funds to fight the eurozone debt crisis, positive US economic news on the housing sector and a better-than-expected earnings report by Goldman Sachs.

The markets have ignored the World Bank’s bleak picture for 2012, were it cut its outlook for global growth in 2012, when in its half yearly assessment of global economic prospects it has slashed its global growth forecast for 2012 from 3.6 percent to 2.5 percent. News the that International Monetary Fund (IMF) would seek up to $US500 billion in additional funds to combat the European debt crisis, was well received by traders.

In today’s job report, the Australian Bureau of Statistics (ABS) reported that the unemployment rate was 5.2 percent in December, compared with a revised 5.2 percent in November. The Australian economy shed 29,300 jobs, with the loss of 53,700 part-time jobs, and a gain of 24,500 full-time position, while the participation rate, was lower at 65.2 percent in December (down from 65.5 percent in November). Shares in the All Ordinaries (XAO) traded eased today, closing down -0.1% at 4279, as the S&P/ASX 200 (XJO) closed down -0.1% at 4215

Aussie shares are expected to continue to rise and traders are expected to continue to look for bargains today, after positive leads from the US and European markets.

See below for ASX listed companies in the news today.

US Markets

US stock markets continued to gain overnight, ending at 6-month highs, as corporate earnings, jobs data and bank earnings reports kept stocks moving higher.

The Dow Jones Industrial Average finished above 12,600, while in the broader markets the S&P 500 and the tech-heavy Nasdaq rose another 0.5%. Financials, Technology and the Industrials all led the gains. Bank of America was up 2.4%, after reporting 4Q revenue that exceeded expectations, while Morgan Stanley gained 5.4% after reporting a fourth-quarter loss that still topped forecasts.

Weekly jobless claims fell the most in over six years.

There were a raft of earnings reports. Union Pacific’s railways rose 2.4%, as fourth-quarter earnings jumped a higher-than-expected 24% as freight revenue rose across all major segments, outpacing higher fuel costs.

Tech stocks were in focus, with F5 Networks posting the strongest gains in the S&P 500 as the Internet networking equipment maker said fiscal 1Q earnings rose 19% and the company also gave an upbeat earnings outlook. Shares rose 11%. EBay jumped 3.9% as the online auctioneer said 4Q earnings and revenue beat expectations, offsetting a downbeat outlook for the current quarter.

After market earning reports included: Google which disappointed, Intel came inline, IBM has a positive 2012 forecast and Microsoft reported well.

All ten company groups that make up the S&P index traded higher with the Materials up 1.1%, Financials sector up 1.5%, Energy sector was up 1.6%, Industrials sector was up 0.9%, Technology was up 1.5%, while Consumer Staples were up 1.6%.

The Dow Jones closed up 0.8% (or 96 points) at 12,578, the S&P 500 index up 1.1% (or 14 points) at 1,308, the Nasdaq ended up 1.5% (or 42 points) at 2,770 and the smaller cap Russell 2000 was up 1.8%.

European Markets

European stock markets rose overnight, as the financials sector led the gains after successful Spanish and French debt auctions. The Stoxx Europe 600 index ended up 1.2%.

The Debt sales in Spain and France buoyed sentiment as demand was firm and borrowing costs fell. The Spanish government exceeded its target of auctioning between EUR3.5 to EUR4.5 billion and it raised EUR3 billion in its first 10-year bond sale this year, for a total auction sale of EUR6.6 billion. The French government sold approximately EUR8 billion of medium-term bonds and as yields declined across the board compared with recent auctions.

The Greek market jumped 3.2% as the talks between the Greek government and its private debt holders appeared to be close to an agreement on fresh proposals.

In London the FTSE 100 index closed up 0.7% (or 39 points) at 5741, the German DAX was up 0.9% (or 62 points) at 6,416 while in France the CAC was up 2.0% (or 64 points) at 3,264, Spain was up 2.2% and Italy ended up 0.6%.

Asian Markets

Asian stock markets pushed higher yesterday, after the International Monetary Fund (IMF) said it planned to boost its lending resources and the Chinese central bank moved to ease liquidity in the money markets.

Markets across the region rose around 1.2%. Financial stocks led the gains. Investors cheered the news from the People’s Bank of China which offered CNY183 billion in 14-day reverse repurchase agreements, pushing short-term borrowing rates lower in Chinese interbank money markets. Remember Chinese trading will be closed next week due to the Lunar New Year holidays.

In China the SSE Composite was closed up 1.3% (or 29 points) at 2,296, while in Hong Kong the Hang Seng Index was up 1.3% (or 256 points) at 19,942 and in Japan the Nikkei 225 Index closed up 1.0% (or 89 points) at 8,639, South Korean KOSPI was up 1.2% for the session, while the Indian market up 1.2%.

Commodities

The Dollar Index was lower at 80.08 on a higher Euro, while the Australian Dollar last traded higher at 1.0430. Commodities prices traded mostly lower.

For the session the Benchmark crude NYMEX for January delivery was down -0.2% (or -$US0.20) settle at $US100.37. Copper prices are seeking a support level as Copper for January delivery was up 1.4% (or 5.0 cents) at $US3.8020. January gold was down -0.3% (or -$US5.40) at $US1,654.

ASX News Today

BPT – Beach Energy ended 2.6% higher, having renegotiated a royalty agreement with Exxon Mobil subsidiary Esso Australia and resolved a related claim that Beach described as a “win-win” result. The royalty agreement relates to assets in the Cooper and Eromanga Basins in central Australia that Beach gained in 2006 through its acquisition of Esso Australia subsidiary Delhi Petroleum.

IVA – Ivanhoe Mines, owner of Mongolia’s Oyu Tolgoi project, will scrap a controversial “poison pill”, clearing the way for its single largest shareholder, Rio Tinto, to take over what could be one of the world’s largest copper-gold mines. The 49 per cent cap on Rio Tinto’s ownership of Ivanhoe has now expired.

LYC – Lynas Corporation the rare earths miner, continued to surge after yesterday, reporting it has significantly increased the estimated resources at its major Mount Weld project in WA.

LNC – Linc Energy continued to surge yesterday.

STO – Santos ended up 0.3%, after saying its production fell -9 percent in the fourth quarter compared to a year earlier and it maintained its forecast for 2012 production. The fall in output was primarily due to the sale of Santos interest in the $16 billion Gladstone coal seam gas-to-LNG project (GLNG) from 60 per cent to 30 per cent.

SYD – Sydney Airport has notched up its sixth consecutive month of weaker passenger numbers after growth in international travellers from key Asian markets failed to help offset a decline in domestic travel. China had helped to boost total international travellers by 2.2 per cent in December, but was not enough to offset a 4.5 percent decline in domestic travellers, leading the airport to reporting a 2.2 per cent fall in total passengers in December.

WBC- Westpac is expected to slash as many as 600 positions across its operations this year, adding to job losses for the banking industry.

WPL – Woodside Petroleum finished down -1.9% after posting a -6 percent fall in fourth-quarter production over the same time last year and maintained its forecast for production of between 73 to 81 million barrels of oil equivalent in 2012.

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

Commodities Stock Index up 0.5%
Gold Stocks Index don -2.3%
Oil Stocks Index up 0.5%

US ADRs – Broadly Mixed!!…

BHP up 0.2% & RIO up 2.7%; AWC up 1.3%
ANZ up 0.1% & NAB up 0.8%
NEM down -1.2%, JHX up 4%, NW S up 2.5%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Crude Oil, European Markets, Ex Dividend, gold price, S&P500, Stock Market Analysis, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Markets Drift Higher On Successful EU Bond Auctions

Thursday, January 19th, 2012

* US stock markets drift higher to levels not seen since mid last year.
* European stocks closed modestly higher after a choppy session overnight, as the Greek market jumped 2.8%.
* Asian stock markets ended mixed yesterday, the Chinese market giving back some of its 4% gains from the previous session.
* Commodities prices traded mostly higher, as Gold prices rose to around $US1,660 and crude-oil closed up around $US101.

The SPI Futures is trading below the key pivot level of 4180, ending up 0.7% (or 30 points) at 4,222. The key levels for our index today are 4180 to 4280.

Yesterday Australian shares edged higher, as investors focused on reports out of the mining sector, rather than disappointing consumer confidence data and fresh profit downgrades from insurers and retailers.

The World Bank reported that the global economy is on the edge of a new financial crisis, that could be more disastrous than the one that followed the collapse of Lehman Brothers in 2008.

In its half yearly assessment of global economic prospects the World Bank slashed its global growth forecast for 2012 from 3.6 percent to 2.5 percent, while high-income nations are forecast to grow at 1.4 percent, down from 2.7 percent, and the eurozone economy is now forecast to 0.3 percent. US growth is now forecast to expand 2.2 percent in its presidential election year (down from the forecast 2.9 percent), while the Chinese economy is expected to expand 8.4 percent this year (down from last year’s 9.2 percent).

Aussie shares are expected to continue rising today and traders are expected to continue looking for bargains, after positive leads from the US and European markets.

See below for ASX listed companies in the news today.

US Markets

US stock markets drift higher to levels not seen since mid last year.

The Dow Jones Industrial Average registered its biggest one-day gain in more than two weeks. The S&P 500 rose above 1300 for the first time since July, for its sixth gain in seven days and the tech-heavy Nasdaq Composite outperformed up 6.3% this year. The Financials, Technology and Energy sectors have led the markets higher in the session.

Financial stocks led the session’s rise, helped by encouraging news at Goldman Sachs Group and strong housing data. A report from the National Association of Home Builders showed confidence among home builders in January rising to a stronger-than-expected reading of 25 (the highest since June 2007).

Goldman Sachs jumped 6.8% after earnings and revenue slumped, although their profits topped lowered forecasts, and Yahoo rose 3.2% after the company announced co-founder Jerry Yang has resigned from the board.

All ten company groups that make up the S&P index traded higher with Materials up 1.1%, Financials up 1.5%, Energy up 1.6%, Industrials up 0.9%, Technology up 1.5%, while Consumer Staples were up 1.6%.

The Dow Jones closed up 0.8% (or 96 points) at 12,578, the S&P 500 index was up 1.1% (or 14 points) at 1,308, the Nasdaq ended up 1.5% (or 42 points) at 2,770 and the smaller cap Russell 2000 was up 1.8%.

European Markets

European stocks closed modestly higher after a choppy session overnight. The European Stoxx 600 index was up 0.1%.

The Greek market jumped 2.8%, as the Greek government resumed talks with bondholders to discuss a voluntary write-down on the country’s sovereign debt and as the Prime Minister said that he would consider forcing a private sector haircut on the debt if a deal cannot be reached.

Across the region stocks jumped as the International Monetary Fund (IMF) reportedly proposed expanding its lending fund to $US1 trillion. Financials had a strong session on the back of successful bond auctions.

Investor sentiment was boosted by a successful bond auction in Germany, which paid the lowest interest rate on record to sell 2-year treasury notes, while the Portuguese government sold EUR2.5 billion in short-term debt with borrowing costs declining slightly.

In London the FTSE 100 index closed up 0.2% (or 8 points) at 5702, the German DAX was up 0.3% (or 22 points) at 6,355 while in France the CAC was down -0.2% (or -5 points) at 3,264. Spain was down -1.7% and Italy ended up 1.3%.

Asian Markets

Asian stock markets ended mixed yesterday. The Chinese market gave back some of its 4% gains from the previous session, as concerns Beijing may not ease its monetary policy encouraged traders to lock in profits ahead of the week-long Lunar New Year holiday.

In Japan the Nikkei Stock Index ended 1% higher, outperforming in the region, as fears about the global economic outlook abated, despite the gloomy World Bank forecasts. In China traders took profits, after the market surged with its biggest gain since October 2009 in the previous session. Growth-sensitive stocks eased, but energy stocks advanced, as benchmark New York crude-oil futures rose back above $101 a barrel.

In China the SSE Composite was closed down -1.4% (or 32 points) at 2,226, while in Hong Kong the Hang Seng Index was up 0.3% (or 59 points) at 19,687 and in Japan the Nikkei 225 Index closed up 1.0% (or 84 points) at 8,550. The South Korean KOSPI was flat for the session, while the Indian market eased to be flat.

Commodities

The Dollar Index was lower at 80.52 on a higher Euro, while the Australian Dollar last traded higher at 1.0404. Commodities prices traded mostly higher.

For the session the benchmark crude NYMEX for January delivery was up 0.4% (or $US0.36) to settle at $US101.07. Copper prices are seeking a support level as Copper for January delivery was up 0.6% (or 2.1 cents) at $US3.7480. January gold was up 0.3% (or $US4.30) at $US1,660.

ASX News Today

BHP – BHP Billiton is set to break its first-half profit records despite softer iron ore prices, as BHP reported iron ore production for the half year to December 31 of 80.6 million tonnes (Mt), up 23 percent on the same period in 2010.

OZL – OZ Minerals has lifted gold output to 160,007 ounces of gold in the final quarter of 2011 while copper production fell 107,744 tonnes, but it still achieved full-year production in line with guidance.

LYC – Rare earths miner Lynas Corporation reported it has significantly increased the estimated resources at its major Mount Weld project in WA. The mineral resource estimate at Mt Weld is now 23.9 million tonnes, up 37 percent from its previous estimate in September 2010, after an extended drilling program at Mt Weld. Lynas is in the development phase of two rare earths projects, a concentration plant at Mt Weld and the Lynas Advanced Materials Plant (LAMP) in Malaysia.

ORI – NSW Environment Minister Robyn Parker says she is deeply concerned by yet another emissions breach at one of Orica’s plants and wants answers.

SGM – Sims Metals, the metals recyler, reported it has made a move into the Chinese market, outlaying $US137 million for a 18 percent stake in a Hong Kong company, Chiho-Tiande Group, which has operations in both Hong Kong and mainland China.

SFH – Retailer Speciality Fashion Group says its Christmas performance was disappointing, with sales lower than the previous year.

WES – Wesfarmers expects a 74 percent drop in first-half earnings from its insurance division because of a high number of natural disasters.

Market Summary

ASX – to open higher
US & UK/Europe – EU higher
Commodities Stock Index up 1.6%
Gold Stocks Index up 0.5%
Oil Stocks Index up 1.3%

US ADRs – Broadly Higher

BHP up 2.7% & RIO up 2.7%; AWC up 0.9%
ANZ up 1.1% & NAB up 1.1%
NEM down -1.0%, JHX up , NWS up 1.5%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX, ASX News, BHP, Business News, Commodities, Crude Oil, European Markets, Ex Dividend, gold price, S&P500, Stock Market Analysis, stockmarket, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Markets Accept Eurozone Downgrades

Tuesday, January 17th, 2012

* US stock markets were closed overnight, but had modest gains for last week.
* European stock markets rose overnight, as investors accept the well publicised eurozone downgrades. The EFSF fund credit rating was also downgraded one notch to AA+.
* Asian stock markets fell yesterday, after the S&P downgraded a number of eurozone nations and stalled debt talks in Greece.
* Commodities prices traded mostly higher, as Gold prices moved higher to around $US1,645, while crude-oil closed higher around $US99.

The SPI Futures is trading below the key pivot level of 4180, ending up 0.2% (or 9 points) at 4,137. The key levels for our index today are 4080 to 4180.

Aussie shares are expected to open modestly higher today, after positive leads from the European markets and as traders look for bargains. Short-term traders may look to position themselves ahead of earnings reporting season in the US.

See below for ASX listed companies in the news today.

US Markets

US stock markets were closed overnight, but had modest gains for last week. For the year-to-date (YTD) the markets are higher with the Dow Jones Index up 1.7%, the S&P500 up 2.5% and the tech-heavy Nasdaq has jumped 4.1%. The VIX has remain subdued YTD as the US earnings season continues in earnest next week.

European Markets

European stock markets rose overnight, as investors accept the well publicised Standard & Poor’s credit rating downgrades of nine eurozone nations, including France, Italy and Spain. The European Stoxx 600 index gained 0.8%.

France lost its prized triple-A credit rating, but sold Treasury bills, with borrowing costs declining from levels seen a week ago. The EFSF fund credit rating was also downgraded one notch to AA+.

In Germany the DAX 30 index rose over 1.3% as automakers provided support after Goldman Sachs reiterated its conviction buy recommendation on BMW and Fiat SpA and added Daimler to its conviction-buy list.

In London the biggest loser in the FTSE 100 was cruise liner company Carnival PLC as its shares plunged -17%, after the company’s Costa Concordia ship ran aground off the coast of Italy on Friday.

In London the FTSE 100 index closed up 0.4% (or 21 points) at 5,657, the German DAX was up 1.3% (or 77 points) at 6,220 while in France the CAC was up 0.9% (or 29 points) at 3,225. Spain was down -0.3% and Italy ended down -0.1%.

Asian Markets

Asian stock markets fell yesterday, after the S&P downgraded a number of eurozone nations and stalled debt talks in Greece.

Investors reacted to the S&P Ratings agency cutting France and Austria’s AAA credit ratings by one notch, in addition to also lowering the ratings of Italy, Spain, Malta, Slovenia, Slovakia, Portugal and Cyprus.

In Japan the Nikkei Stock Index fell -1.4%, as European exposed exporters posted steep losses, after the euro sank to a fresh 11-year low against the Japanese yen.

In China the Shanghai Composite shed another -1.7%, down for a fourth straight session. Airline stocks plunged after Citigroup downgraded a number of the airline stocks to sell. China releases their GDP figures today.

In China the SSE Composite closed down -1.7% (or -38 points) at 2,206, while in Hong Kong the Hang Seng Index was down -1.0% (or -192 points) at 19,012 and in Japan the Nikkei 225 Index closed down -1.4% (or -122 points) at 8,378. The South Korean KOSPI was down -0.9% for the session, while the Indian market was up 0.2%.

Commodities

The Dollar Index was higher at 81.45 on a lower Euro, while the Australian Dollar last traded lower at 1.0308. Commodities prices traded mostly higher.

For the session the benchmark crude NYMEX for January delivery was up 1.0% (or $US1.00) to settle at $US99.69. Copper prices are seeking a support level as Copper for January delivery was up 1.1% (or 1.1 cents) at $US3.6720. January gold was up 0.9% (or $US14.80) at $US1,645.

ASX News Today

DJW – Two listed investment companies have suffered from last year’s market decline, with net losses on its trading portfolio dragging down Djerriwarrh Investments’ (DJW) in the first-half 2012 profit by 9.5 percent.

DTE – Dart Energy has created a wholly owned subsidiary and business unit named Dart Energy International Shale to develop its growing European shale gas resources.

FMG – Fortescue Metals Group is considering developing its North Star magnetite iron ore project in WA as a joint venture.

LEI – Leighton Holdings says its underlying profit for the six months to December will be stronger than previously forecast.

LNC – Linc Energy says it is in talks regarding new gas opportunities in China.

QAN – Qantas has begun A380 services between Sydney and Hong Kong.

Ex-dividend Date

None

Market Summary

ASX – to open higher
UK/Europe - higher

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Crude Oil, European Markets, Ex Dividend, gold price, S&P500, Stock Market Analysis, stockmarket, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Markets Ease Ahead Of Eurozone Milestones

Thursday, January 12th, 2012

* US stock markets finished flat for the day, as European debt concerns resurfaced. The Dow Jones Index has risen 6% (or 700 points) in the past 15 trading sessions.
* European stock markets fell overnight due to renewed fears about the weakening eurozone economy.
* Asian markets mostly ended higher yesterday, with resource and financial sector stocks leading the way.
* Commodities prices traded mixed, as Gold prices moved higher to around $US1,644, while crude-oil closed around $US101.

The SPI Futures is trading below the key pivot level of 4180, ending flat at 4,171. The key levels for our index today are 4080 to 4200. Aussie shares are expected to open flat and traders are expected to stay on the sidelines today, after subdued leads from the US and European markets. Short-term traders may look to take profits.

See below for ASX listed companies in the news today.

US Markets

US stock markets finished flat for the day, as European debt concerns resurfaced.

The Dow Jones Index has risen 6% (or 700 points) in the past 15 trading sessions. In the broader market the energy sector dragged on the indices, while materials and financial stocks limited the losses, as the banks rose around 2%. Coca-Cola dropped 2% after an analyst downgrade. Today’s mild pullback came amid renewed signs that the eurozone growth is slowing, adding to fears about how the debt crisis there will unfold.

Commodities were mixed. Crude oil futures prices were down -1.3% as US demand reportedly fell sharply, while gold futures advanced to a four-week high overnight, as investors bet the market’s recent upswing would continue, and eurozone debt concerns fuel demand for alternative assets.

All ten company groups that make up the S&P index traded higher, except the Energy sector which was down -1.5%. Materials were up 1.0%, Financials were up 0.9%, Industrials were up 0.3%, Technology were up 0.4%, and Consumer Staples were up 0.1%.

The Dow Jones closed down -0.1% (or -13 points) at 12,450, the S&P 500 index was up 0.1% (or 1 point) at 1,292, the Nasdaq ended up 0.3% (or 8 points) at 2,710 and the smaller cap Russell 2000 was up 0.2%.

European Markets

European stock markets fell overnight due to renewed fears about the weakening eurozone economy. The benchmark Stoxx Europe 600 index lost -0.4%.

Traders became cautious after the head of sovereign ratings for Fitch, David Riley, said the European Central Bank should do more to prevent the collapse of the euro, and the ECB reported that its overnight deposit facility reached another record, suggesting eurozone banks prefer to store cash safely at the ECB rather than risk lending to other banks. There is also speculation that France had been warned of an imminent credit-rating downgrade by Standard & Poor’s Investors Service, although this has been denied by French officials.

Economic data also weighed in Germany, where the economy contracted around 0.25% in the fourth quarter of 2011, while Spanish industrial output dropped 7% in November from a year earlier after declining 4.2% in October, indicating that the Spanish economy may also have contracted in the fourth quarter. Markets remain on edge ahead of debt auctions in Italy and Spain on Thursday, along with an ECB meeting where interest rates may be cut.

In London the FTSE 100 index closed down -0.2% (or -10 points) at 5,697, the German DAX was down -0.2% (or -10 points) at 6,152, while in France the CAC was down -0.2% (or -6 points) at 3,204. Spain was down -0.5% and Italy ended up 0.3%.

Asian Markets

Asian stock markets mostly ended higher yesterday, with resource and financial sector stocks leading the way. Across the region gains were broad based on the back of higher commodities prices. In Hong Kong the Hang Seng Index gained for a third straight day. Chinese stocks declined for the first time in four trading days, as coal miners saw some profit-taking.

In China the SSE Composite closed down -0.4% (or -10 points) at 2,276, while in Hong Kong the Hang Seng Index was up 0.8% (or 147 points) at 19,151 and in Japan the Nikkei 225 Index was closed up 0.3% (or 25 points) at 8,448. The South Korean KOSPI was down -0.4% for the session, while the Indian market was up 0.1%.

Commodities

The Dollar Index was higher at 81.30 on a lower Euro, while the Australian Dollar last traded lower at 1.0313. Commodities prices traded higher.

For the session the benchmark crude NYMEX for January delivery was down -1.2% (or -$US1.21) to settle at $US101.06. Copper prices are seeking a support level as Copper for January delivery was up 1.1% (or 3.9 cents) at $US3.5485. January gold was up 0.5% (or $US8.20) at $US1,643.

ASX News Today

AKI – African Iron the Australian-listed iron company with iron ore operations in the Republic of Congo, has a takeover bid from South African mining company Exxaro for about $388 million.

BTT – BT Investment Management says its assets under management rose slightly in the final quarter of 2011.

CWK – Coalworks says it will get on with developing its NSW coal assets in 2012, despite rumours of being a takeover target from Whitehaven Coal.

EXT – The Extract Resource takeover by a Chinese state-owned power company has moved closer, after getting Namibian Government approval.

IRON ORE – Big miners FMG, BHP & RIO have halted exports from the Pilbara region as a category one cyclone moves toward the WA coast.

PBG – Pacific Brands has a takeover bid, which could mark the start of a buying spree among private equity firms in search of bargains.

RMS – Ramelius Resources, the gold miner, says production and sales were lower in the December quarter, but has forecast improvements for the first quarter of calendar 2012.

SPT – Spotless Group’s hostile takeover bid appears to have stalled, with the private equity suitor unwilling to meet a demand to increase the bid.

Ex-dividend Date

None

Market Summary

ASX – to open flat
US & UK/Europe – mixed
Commodities Stock Index down -0.1%
Gold Stocks Index up 0.1%
Oil Stocks Index down -1.5%

US ADRs – Broadly Higher

BHP up 0.6% & RIO up 1.1%; AWC up 3.7%
ANZ up 2.1% & NAB up 0.4%
NEM up 1.1%, JHX up 3.0%, NWS up 0.6%

By Michael Hevern
Head of Research

Stock Market Analysis: Giddy Up – Central Banks Take Coordinated Action!

Thursday, December 1st, 2011

* US markets surged higher overnight for their biggest gain since 2008. There were a number of major economic developments overnight but the primary driver was the global central banks moving to shore up liquidity in the global financial system.
* European stock markets surged higher overnight, after a coordinated effort from global central bankers who moved to increase the liquidity in money markets, and China also lowered bank reserve requirements for the first time in three years.
* Asian shares ended mostly lower yesterday, capping off a month of losses and the second worst month of the year, after September.
* Commodities prices traded higher, as Gold prices higher to $US1,712 and crude-oil closed around $US100.

The SPI Futures is trading around the key pivot level of 4280, ending up 3.4% (or 141 points) at 4,255. The key levels for our index today are 4200 to 4300.

Yesterday Australian shares finished in the black for a third session as we ruled off a pretty dismal month. The All Ords finished down -4.6 percent for November, its second-worst monthly performance this year behind September. The overall market has also lost -10.5 percent since the start of the year, and is down 17.4 percent since its peak in mid-April.

Australian house price data reported yesterday by RP Data-Rismark showed prices falling at an accelerating rate. Melbourne and Brisbane reported the steepest drops over the past year and Sydney and Canberra have held up the best. In the ten months to October, seasonally adjusted home prices in Melbourne were down 5.8 percent, followed by Brisbane down -7.5 percent, while in Sydney housing values were down -1.4 per cent in 2011, but in Canberra they are up 0.9 percent. Seasonally adjusted national home prices have dropped 4 percent so far in 2011 and the median dwelling price in capital cities now stands at $448,500.

Shares in the All Ordinaries (XAO) were generally higher again today, with the index closing up 0.4% at 4185, and the S&P/ASX 200 (XJO) up 0.4% at 4120.

Aussie shares are expected to surge higher today, after the sharply higher leads from the US and European markets. We continue to have a busy week for AGMs and production reports, see below for details.

Economics News Today

* Nov Australian PMI
* Oct Retail Retail Sales

US Markets

US markets surged higher overnight for their biggest gain since 2008. There were a number of major economic developments overnight but the primary driver was the global central banks moving to shore up liquidity in the global financial system.

The coordinated action plan by a number of central banks was announced in a move to make US dollar funding cheaper for European banks. This news came after China indicated it too would loosen monetary policy by lowering the reserve requirement ratio for banks.

The Dow Jones Industrial Index surged above 12,000, as all 30 components jumped as much as 8% for the session. In the broader markets the S&P 500 stock index climbed above 1,245 and the tech-heavy Nasdaq rebounded above 2,600, as stocks surged from the open, which meant that short covers did not get a chance to bail out before major damage was done.

The joint coordinated action by the central banks highlights the severity of the crisis at this time, however the move does not address the fundamental problems associated with European government debt. The central banks of the US, Canada, the BoE and BoJ have taken action and the move cuts the rate by 50 basis points, which is expected to ease the worsening crisis in Europe.

The news overshadowed the Standard & Poor’s Ratings Services downgrade of 15 large banks, including Goldmans, Lloyds of London, J.P. Morgan and Bank of America. The credit downgrades will make it more expensive for those banks to fund their daily activities in the overnight debt markets. Commodities got a boost for the news from the central banks too.

All ten company groups that make up the S&P index surged with Materials up 5.7%, Energy up 5.5%, Financials up 6.2%, Industrials up 5.1%, Technology up 3.9%, while Consumer Staples were up 3.1%.

The Dow Jones closed up 4.2% (or 490 points) at 12,046, the S&P 500 index closed up 4.3% (or 52 points) at 1,247, the Nasdaq ended up 4.2% (or 105 points) at 2,620, and the smaller cap Russell 2000 was up 5.9%.

European Markets

European stock markets surged higher overnight, after a coordinated effort from global central bankers to increase the liquidity in money markets, and China also lowered bank reserve requirements for the first time in three years. The Stoxx Europe 600 index ended up 3.6%.

The European banking system has been grinding to a halt in recent times and banks have been struggling to acquire US dollars due to the soaring costs of borrowing as the eurozone sovereign debt crisis worsened.

In Germany the market surged above 6,000, while in London the FTSE cracked the 5,500 level. The European markets started off on a strong footing after news that the People’s Bank of China will cut the reserve requirement ratio for all banks by 0.5 percentage point. However the sentiment was tempered as a two-day meeting of eurozone finance ministers in Brussels disappointed by not setting a size target for the European Financial Stability Facility (EFSF).

The next key meeting will be on 9 December at the summit of European Union leaders where markets are hoping for a final action plan to contain the debt crisis. Once the news of the coordinated central bank efforts was released equities surged across the board, with all sectors surging.

In London the FTSE 100 index closed up 3.2% (or 168 points) at 5,505, the German DAX was up 5.0% (or 289 points) at 6,088 while in France the CAC was up 4.2% (or 128 points) at 3,155. Spain was up 3.9% and Italy ended up 4.4%.

Asian Markets

Asian stock markets ended mostly lower yesterday, capping off a pretty dismal month of losses and the second worst month of the year. Asian markets in general have had a dismal November, with the Nikkei losing -7 percent, the Hang Seng down -10 percent and China down a slightly more modest -5.5 percent.

Around the region, financial stocks were broadly lower, as Chinese stocks dropped on growth concerns and financial shares falling after Standard & Poor’s Ratings Services downgraded 15 global banks. In China the Shanghai Composite dropped -3.3%, posting a fall of -5.5% for the month, while in Hong Kong the Hang Seng Index was down -9.4% in November. Overnight the Nikkei 225 Index was down -0.5% (or -45 points) at 8,477, the South Korean KOSPI was down -0.5% for the session, while the Indian market was up 0.7%.

It is a new day and a new month, and equities will surge today, after the staggering moves in overseas market overnight, after the coordinated central bank call to action.

Commodities

The Dollar Index was lower at 78.38 on a higher Euro, while the Australian Dollar last traded higher at 1.0278. Commodities prices traded higher.

For the session the benchmark crude NYMEX for December delivery was up 0.5% (or $US0.50) to settle at $US100.22. Copper prices are seeking a support level as Copper for December delivery was up 3.2% (or 9.5 cents) at $US3.3760. December gold was up 2.5% (or $US40.00) at $US1,713.

ASX News Today

AQA – Aquila Resources rose after the coal miner received conditional approval from the federal government for its first ever iron ore mine.

BHP – BHP Billiton is reviewing its diamonds business in the Canadian far north and is looking for a buyer for some or all of it.

BKN – Bradken has completed a $US200 million ($A199.99 million) US private bond placement as the company aims to diversify funding sources and extend the maturity of its debt.

CNU – Chorus, the telecommunications network company carved out of Telecom, will not need to access much of a bridging loan after securing a $1.35 billion syndicated bank facility.

GCL – Gloucester Coal says it expects annual coal production to rise six fold to 12 million tonnes in less than 10 years, as it moves from one to four distinct operations.

LYC – Lynas Corporation, Australia’s largest rare earths miner, says prices for rare earths have fallen in recent months, which is a healthy development for the industry.

MTS – Metcash is now free to complete its transformation of the Franklins supermarket chain after an appeal court confirmed that the $215 million acquisition does not breach competition law. Metcash has reported a 14 percent drop in first-half profit but has increased its financial forecasts for the full year. Meanwhile Metcash has declared itself the “champion” of brands, saying it will differentiate itself from Coles and Woolworths who are moving towards a proliferation of home-brand private labels on their shelves.

NHC – New Hope Coal has received a number of take-over proposals from third parties, and talks are continuing.

RIO – Rio Tinto is getting closer to taking a foothold in the Canadian uranium market as its proposed Hathor acquisition of a largely untapped mine looks likely to go ahead.

Local Corporate Reporting

Foster’s Group (FGL) General Meeting

Nufarm Limited (NUF) Full year 2011 AGM

Ex-dividend Date

None

Market Summary

ASX – to open flat

US & UK/Europe – modestly higher

Commodities Stock Index up 6.2%
Gold Stocks Index up 7.3%
Oil Stocks Index up 5.6%

US ADRs – Sharply Higher

BHP up 7.9% & RIO up 9.2%; AWC up 11.5%
ANZ up 7.8% & NAB up 6.9%
NEM up 5.5%, JHX up 7.8%, NWS up 5.6%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX News, Business News, Commodities, Crude Oil, Dividend, European Markets, gold price, S&P500, stockmarket, trading, US Market wrap
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Stock Market Analysis: Markets Remain On Edge Due To Global Debt and Growth Concerns

Monday, November 28th, 2011

* US stock markets ended the week lower again, with their worst Thanksgiving week performance since the middle of last century.
* European stock markets snapped thier six-session losing streak, session, as eurozone leaders cannot establish an agreement on how to resolve the European debt crisis.
* Asian markets closed mostly lower Friday. The selling was again broad with energy and banking stocks leading the declines, as ongoing European debt concerns drove sentiment.
* Commodities prices traded lower, as Gold prices lower to $US1,692 and while crude-oil closed around $US97.

The SPI Futures is trading around the key pivot level of 4250, ended down -0.6% (or -25 points) at 4,039. The key levels for our index today are 3950 to 4120.

On Friday the Australian stock market has finished the week’s dismal performance in the red for a sixth day, and finished below the psychological 4000 level, destroying approximately $75 billion off the value of the overall market. As we highlighted a couple of weeks ago the Asian markets are bearing the brunt of the selling over the eurozone debt crisis, but now we are seeing the major European markets and the United States joining in on the selling spree, as the eurozone financial system appears to be grinding to a halt. In Japan the core consumer prices fell for the first time in four months, indicating that the Japanese economy is falling into a deflationary cycle, due to persistently weak domestic demand.

Locally, the housing market is in the news this week, as we approach the so call “Super Saturday”, which is one of the busiest weekends of the year for home auctions. However economist Michael West has put a damper on proceedings, as he is bearish on the Australian housing market and predicts that local house prices could fall by as much as 25 percent based on the latest global house-price indicators in The Economist magazine. The latest global house price indicators are now falling in eight of the sixteen countries surveyed by The Economist (versus five in 2010). Shares in the All Ordinaries (XAO) generally eased again today, closing down -1.4% at 4058, as the S&P/ASX 200 (XJO) closed down -1.5% at 3984.

Aussie traders are expected to trade cautiously today and may be look to pick up some “bargains”, after the mixed leads from the US and European markets, as traders fears over the eurozone debt crisis continued to be the primary focus, after a disappointing comments from Germany about a proposed Euro bond issue, and in the US the “super committee” charged with reducing the US deficit is deadlocked. We continue to have a busy week for AGMs and production reports, see below for details.

See below for ASX listed companies in the news today.

Economics News Today
* Nov     Australian PSI
* Nov     TD Securities Monthly Inflation Gauge
* Nov     ANZ Job Ads
* Q3      Business Indicators
* Nov     VFACTS vehicle sales.

U.S. Markets

US stock markets ended the week lower again, with their worst Thanksgiving week performance since the middle of last century.

The Dow Jones closed at 11,293, the S&P 500 index closed 1,161 the Nasdaq closed at 2,474. US stock markets ended the week lower again, with their worst Thanksgiving week performance since the middle of last century. The Dow Jones index finished the week down -4.8% and is down -3% for the year, and it at its lowest level since 7 October.

In the broader markets the the performance was also dismal with the S&P500 losing -7.6% in the past couple of weeks, while the tech-heavy Nasdaq is down -11% in the past week. Trading volumes were thin last week due to the Thanksgiving holiday. Investors have been plagued with debt concerns in Euopre and the US as Washington’s deficit-cutting Super Committee made little progress, triggering a sell-off, and the news out of Europe is getting worse by the day. There is a busy week on the economic front with hiusig figures and the Non-Farm payrolls employment report on Friday.

All the ten company groups that make up the S&P index traded mixed with the Materials were down -0.5%, Energy sector were down -0.7%, Technology sector was down -0.5% , Industrials were down -0.2%, while the Financials sector was up 0.3%, and Consumer Staples were up 0.4%.

The Dow Jones closed down -0.2% (or -26 points) at 11,232, the S&P 500 index closed down -0.2% (or -3 points) at 1,159 the Nasdaq ended down -0.8% (or -19 points) at 2,441.

European Markets

European stock markets snapped their six-session losing streak, but eurozone leaders still cannot establish an agreement on how to resolve the European debt crisis. The Stoxx Europe 600 index rising on Friday, but still dropped -4.6% for the week.

Investor sentiment has been under pressure from the deteriorating debt conditions in the the PIIGS economies. The Italian cost of debt remains high as Italy sold EUR8 billion of six-month bills, but at a yield of 6.5%, a eurozone high. The disunity between the German, French and Italian leaders over how to resolve the crisis in the euro zone also weighed on investors. German Chancellor Angela Merkel said that Germany would not support the issuance of eurobonds, while French President Nicolas Sarkozy said the leaders had agreed not to put additional pressure on the European Central Bank. Investor sentiment has been under pressure from the deteriorating debt conditions in the the PIIGS economies. European traders tentatively went shopping for bargains.

In London the FTSE 100 index closed up 0.7% (or 37 points) at 5,165, the German DAX was up 1.2% (or 65 points) at 5,492 while in France the CAC was up 1.2% (or 35 points) at 2,857.

Asian Markets

Asian stock markets closed mostly lower Friday. The selling was again broad with energy and banking stocks leading the declines, as ongoing European debt concerns drove sentiment.

For the week in Hong Kong the Hang Seng was down -4.6%, in Japan markets were down -2.6%,in Korea markets were down -3.3%, while in China the Shanghai Composite retraced over -1.6%. The Chinese market is drifting down towards 2-year lows again.

In China the SSE Composite was closed down -0.7% (or -17 points) at 2,380, while in Hong Kong the Hang Seng Index was down -1.4% (or -245 points) at 17,689 and in Japan the Nikkei 225 Index was closed down -0.1% (or -5 points) at 8,160, South Korean KOSPI was down -1.0% for the session.

Commodities

The Dollar Index was higher at 79.27 on a lower Euro, while the Australian Dollar last traded lower at 98.01. Commodities prices traded lower.

For the session the Benchmark crude NYMEX for December delivery was up 0.6% (or $US0.60) settle at $US7.32. Copper prices are seeking a support level as Copper for December delivery was down -0.3% (or -0.9 cents) at $US3.2740. December gold was down -0.6% (or -$US10.20) at $US1,691.60. .

ASX News Today

BBG – Billabong the surfwear maker and seller says it does not know why its shares dropped -12.5 per cent on the highest trading volume in three months on Thursday.

BXB – Brambles the pallet services provider has acquired Canadian counterpart company Paramount Pallet for $C13 million ($A12.7 million).

DUE – DUET Group the electrical wire and gas pipeline owner, has confirmed it will pay a distribution of 16 cents per stapled security this financial year.

EPW – ERM Power the electricity generator and seller has extended a contract with Woolworths in Victoria by three years for a value of $140 million.

FGL – In the final hurdle for the takeover the Federal Treasurer Wayne Swan has approved SABMiller’s $11.5 billion deal to acquire Foster’s under foreign acquisitions laws, but imposed conditions requiring the company to keep brewing operations in Australia.

FMS – A Russian steel making giant is expected to do a deal with Fortescue Metals Group after a $554 million takeover of Flinders Mines, which operates an iron ore project next to Fortescue’s Solomon development.

IZM – Mining giant Rio Tinto has agreed to take part in Intercept Minerals’ bauxite project on Tiwi Islands.

MYR – Myer has reiterated that sales this fiscal year will be flat and net profit will decline as much as 10 per cent because of the tough retail conditions. Myer chairman Howard McDonald, telling shareholders at its AGM, that while there were no clear short-term indicators of when consumer confidence would return to more normal levels, Myer remains highly leveraged to any upturn, and the recent cut in official interest rates by the RBA should help in the lead up to the critical Christmas trading period.

PRY – Primary Health Care has forecast profit growth of up to 22 percent as it grows its existing general practice, pathology and diagnostic imaging businesses.

SDL – Sundance Resources has requested its shares be placed in a trading halt pending an update on the proposed take-over by Hanlong Mining Group.

WHC – Whitehaven Coal says it will have an additional 2.4 million tonnes per annum (Mtpa) of port capacity at Port Waratah Coal Services in Newcastle from 2015.

WPL – Woodside Petroleum has set a production target for calendar 2012 that is 27 percent higher than 2011, as its Pluto liquified natural gas project comes on stream.

Local Corporate Reporting

Platinum Australia (PLA) Full year 2011 AGM

Regis Resources (RRL) Full year 2011 AGM

Sandfire Resources (SFR) Full year 2011 AGM

Rio Tinto Ltd (RIO) Investor Seminar

Ex-dividend Date

BTT – BT Investment Mgt

Market Summary

ASX – to open flat

US & UK/Europe – US lower, EU higher

Commodities Stock Index down -1.2%
Gold Stocks Index down -1.4%
Oil Stocks Index down -1.1%

US ADRs – Broadly Lower!!…

BHP down -0.9% & RIO down -4.0%; AWC down -5.3%
ANZ down -1.9% & NAB down -1.2%
NEM down -0.7%, JHX down -0.5%, NW S down -0.2%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Crude Oil, European Markets, gold price, S&P500, Stock Market Analysis, stockmarket, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Bargain Hunters Tentatively Step In

Wednesday, November 23rd, 2011

* U.S. stocks fell modestly overnight in another rollercoaster session. Investors had to deal with mixed signals.�
* European stock markets fell again overnight in a volatile session, as Spanish debt funding costs remained high.
* Asian stock markets eased again. Investor sentiment was weighed by U.S. and European debt issues, but bargain hunters appeared to take tentative steps into the market late in the session.
* Commodities prices traded mixed, as gold prices hovered around $US1,675 and crude-oil closed around $US98.

The SPI Futures is trading around the key pivot level of 4250, ending down -0.6% (or -26 points) at 4,126. The key levels for our index today are 4080 to 4180.

Yesterday Australian stocks started lower again on the open, but bargain hunters tentatively entered the market in the afternoon session. Investors remain cautious about the problems of debt financing in the euro zone’s PIIGS economies. However the markets in the Asian region have led the recent sell down, and traders appear to be starting to see some “value” in beaten down stocks. The comments from Chinese Vice Premier Wang Qishan, who warned that a lasting global recession is on the cards continued to weigh on our miners, as commodities prices weakened.

Yesterday JPMorgan chief economist Stephen Walters said that owing to the ongoing debt crisis in Europe, there could see three RBA interest rate cuts in the next twelve months, with the first cut as early as December.

Shares in the All Ordinaries (XAO) generally eased again yesterday, closing down -0.7% at 4204, and the S&P/ASX 200 (XJO) closed down -0.7% at 4133.

Aussie traders are again expected to start looking for some value today, despite the negative leads from the US and European markets. We continue to have a busy week for AGMs and production reports, see below for details.

Economics News Today

* Q3 Construction Work Done Report

US Markets

US stocks fell modestly overnight in another rollercoaster session. Investors had to deal with mixed signals, weighing slower-than-expected domestic economic growth and continued euro zone concerns with signs that the Federal Reserve may take new steps to introduce quantative easing to support the US economy.

The Dow Jones Index fell to its lowest level since mid-October, and has been down four of the past five sessions, falling -5% in that time. The S&P 500 index has lost -5.5% during its five consecutive sessions of losses, while the tech-heavy Nasdaq has lost ground in the past five sessions, its longest losing streak since July 2010.

The losses came after the US government revised third-quarter growth to 2% from an initial estimate of 2.5%, but on the flip side Moody’s Investors Service reiterated its triple-A rating on the US and said the committee’s failure to agree would not by itself lead to a rating change. Also, the minutes from the Fed’s FOMC policy meeting boosted some hopes that the central bank may embark on more stimulative measures.

In corporate news Hewlett-Packard dropped -0.8% after the technology company issued a disappointing earnings outlook for the current quarter and the next fiscal year.

In commodities crude oil futures traded back above $98 a barrel, as tensions in the Middle East fueled concerns over supplies from that region, while gold futures rebounded from 4-week lows as a weaker dollar pushed the price higher.

All ten company groups that make up the S&P index traded lower with Materials down -0.9%, Energy down -1.0%, Financials down -0.7%, Technology down -0.3%, Industrials down -0.9%, while Consumer Staples were down -0.2%.

The Dow Jones closed down -0.5% (or -53 points) at 11,493 and the S&P 500 index closed down -0.4% (or -5 points) at 1,188. The Nasdaq ended down -0.1% (or -2 points) at 2,521, and the smaller cap Russell 2000 was down -0.8%.

European Markets

European stock markets fell again overnight in a volatile session, as Spanish debt funding costs remained high. The Stoxx Europe 600 index fell -0.7%.

European markets had initially gained in the early session after Standard & Poor’s Ratings Services said the US credit rating was unaffected by news that a congressional super committee had failed to reach agreement on a deficit-reduction plan. However losses came after the US government revised third-quarter growth to 2% from an initial estimate of 2.5% and as the Spanish government sold EUR3 billion in 3 and 6 month bills overnight, but at a much higher yield, as yields on 10-year Spanish government bonds remained elevated at 6.53%.

Financials weighed yet again. This time Germany was in focus as Commerzbank AG shares plunged -15% after a Reuters report, citing unnamed sources close to the bank, claimed Commerzbank may need much more capital than previously expected to meet a 9% core capital buffer by the middle of 2012 as required by the European Banking Authority. Deutsche Bank AG fell -3.4%.

In France banks plunged another -5% due to concerns over a possible downgrade of the French economy.

In London the FTSE 100 index closed down -0.3% (or -16 points) at 5,207, the German DAX was down -1.2% (or -69 points) at 5,537 while in France the CAC was down -0.8% (or -24 points) at 2,870. Spain was down -1.5% and Italy was down -1.5%.

Asian Markets

Asian stock markets eased again yesterday. Investor sentiment was weighed by US and European debt issues, but bargain hunters appeared to take tentative steps into the market late in the session.

Traders have been buffeted by the ongoing concerns over debt issues, with the special US debt-cutting super committee failing to reach agreement on how to reduce the nation’s budget deficit, and in Europe now there are concerns about France’s triple-A credit rating.

Across the region the financials weighed again, but towards the end of the session we saw traders buying those beaten down growth sensitive stocks. In Japan, export companies saw gains of around 2% as the US dollar held strong against the yen. Technology stocks saw some buying too, especially Chinese internet stocks which rose around 3% for the session.

In China the SSE Composite closed down -0.1% (or -1 point) at 2,412, while in Hong Kong the Hang Seng Index was up 0.1% (or 26 points) at 18,252 and in Japan the Nikkei 225 Index closed down -0.4% (or -34 points) at 8,315. The South Korean KOSPI was up 0.3% for the session, while the Indian market was up 0.8%.

Commodities

The Dollar Index was higher at 78.24 on a lower Euro, while the Australian Dollar last traded lower at 98.45. Commodities prices traded lower.

For the session the benchmark crude NYMEX for December delivery was up 1% (or $US1.00) to settle at $US97.92. Copper prices are seeking a support level as Copper for December delivery was up 1% (or 3 cents) at $US3.3350. December gold was up 1.4% (or $US23.90 at $US1,675.

ASX News Today

BSL – BlueScope Steel plans to sell $600 million in new shares at 40cps or a 34 percent discount to raise money to strengthen the company’s financial position by repaying debt. The fully underwritten, 4-for-5 entitlement offer will strengthen the balance sheet and proceeds will go to repaying debt.

CBA – Commonwealth Bank and National Australia Bank have each delayed plans to sell up to $1.5 billion of covered bonds in the international markets due to the impact of Europe’s debt crisis, banking sources say. They have defered the bond issue due to soaring borrowing costs in Europe.

CMW – Crowmwell Property Group announced a $145.4 equity raising, and a $186 million Brisbane office building acquisition.

CER – Centro the shopping centre operator has successfully completed the first hurdle in its bid for a restructure at a series of meetings for security holders to consider the move.

QAN – Qantas and the unions will face Fair Work Australia arbitration in an attempt to resolve the long-running industrial dispute with Qantas.

QRN – The Queensland government has declared victory in its privatisation of the state freight rail line.

TGA – Thorn Group expects to increase full year profit by more than 20 percent to $28 million as lower income households rent fridges and washing machines for longer.

Local Corporate Reporting

Ausdrill Ltd (ASL) Full year 2011 AGM

Acrux Limited (ACR) Full year 2011 AGM

Ceramic Fuel Cells (CFU) Full year 2011 AGM

Independence Group (IGO) Full year 2011 AGM

IOOF Holdings (IFL) Full year 2011 AGM

NRW Holdings (NWH) Full year 2011 AGM

Programmed Maintenance Services (PRG) Interim 2012 Results

Virgin Blue Hldgs (VBA) Full year 2011 AGM

Ex-dividend Date

None

Market Summary

ASX – to open lower

US & UK/Europe – sharply lower

Commodities Stock Index down -0.8%
Gold Stocks Index up 1.0%
Oil Stocks Index down -1.2%

US ADRs – Generally Lower

BHP down -1.0% & RIO down -1.2%; AWC up 2.6%
ANZ down -1.0% & NAB up 0.4%
NEM up 0.4%, JHX lower, NWS up 0.4%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Crude Oil, Dividend, European Markets, gold price, S&P500, Stock Market Analysis, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Debt Concerns Send Traders Packing

Tuesday, November 22nd, 2011

* US stock markets plunged on open overnight and did not recover, as debt concerns filtered through to the US, as Washington’s deficit-cutting Super Committee made little progress, triggering the selloff.�
* European stock markets dropped sharply overnight, due to growing concerns that the problems in Italy and Spain could lead to problems for the credit rating for the French economy. The Stoxx Europe 600 index fell -3.2%.
* Asian stock markets continued their slide. Investors continued to head for the exits as the debt issues in the eurozone and the US remain in focus. Traders are expected to remain negative again today.
* Commodities prices traded sharply lower, as gold prices were lower to $US1,674 and crude-oil closed down around $US97.

The SPI Futures is trading around the key pivot level of 4250, ending down -1.6% (or -65 points) at 4,121. The key levels for our index today are 4080 to 4180.

Yesterday Australian stocks drifted lower on yet another day of light trading. Investors chose caution due to the problems over the debt financing of the PIIGS economies in the eurozone. There were losses in stock markets across the Asian region, not helped by comments from Chinese Vice Premier Wang Qishan, who warned that a lasting global recession is on the cards.

In Canberra the federal government’s proposed mining tax cleared an important hurdle, with the key independent MPs agreeing to support the legislation in return for stronger oversight of coal seam gas projects and a higher threshold when the tax takes effect. Independent MP Andrew Wilkie said he would support the 30 percent tax, in return for lifting the starting threshold from a profit of $50 million to $75 million.

Superannuation funds have provided investors with some good news, reporting an increase in October after five consecutive months of negative returns. According to research company SuperRatings, balanced super funds gained 2.8% last month.

Shares in the All Ordinaries (XAO) generally eased again yesterday, closing down -0.3% at 4234. The S&P/ASX 200 (XJO) also closed down -0.3% at 4163.

Aussie traders are expected to sell off stocks again today, following the negative leads from the US and European markets. Traders fears over the eurozone debt crisis continue to weigh on sentiment, as Italian and Spanish debt funding costs remain at unsustainable levels, and in the US the super committee charged with reducing the US deficit hit a deadlock. We continue to have a busy week for AGMs and production reports, see below for details.

US Markets

US stock markets plunged on open overnight and did not recover, as debt concerns filtered through to the US. Washington’s deficit-cutting Super Committee made little progress, triggering the sell-off.

The Dow Jones Index broke support finishing at levels not seen since early October as all 30 component stocks finished in the red. In the broader markets the S&P500 and the tech-heavy Nasdaq finished around -2% lower. The financials and industrials sectors slumped over -2.3%, while the materials, energy, and technology sectors all traded down over -1.8%.

The US Super Committee, responsible for reducing the budget deficit by at least $US1.2 trillion over the next 10 years or risk triggering an automatic spending cuts, is deadlocked. This news triggered the selloff as traders worried about a possible credit rating cut being the fallout of the failed negotiations.

Commodities continued their selloff, with gold slumping to $US1,674 per ounce.

All ten company groups that make up the S&P index traded lower with Materials down -1.4%, Energy down -1.4%, Financials down -2.1%, Technology down -1.4%, Industrials down -2.0%, and Consumer Staples down -1.3%.

The Dow Jones closed down -2.1% (or -249 points) at 11,547, the S&P 500 index closed down -1.9% (or -18 points) at 1,197, the Nasdaq ended down -1.9% (or -49 points) at 2,523, and the smaller cap Russell 2000 was down -2.1%.

European Markets

European stock markets dropped sharply overnight, due to growing concerns over the problems in Italy and Spain could lead to problems with the credit rating for the French economy. The Stoxx Europe 600 index fell -3.2%.

The Moody’s Investors Service warned that rising French government borrowing costs and the faltering economic outlook could threaten the country’s AAA rating outlook.

Across the region the banks plunged on the growing fear over a possible financial system collapse in the eurozone. Resource stocks also sold off heavily. In London the FTSE 100 fell -2.5% as the resource stocks such as Xstrata PLC and Anglo American PLC dropped over -5%. The Spanish market also fell despite the overwhelming victory for the opposition popular and fiscally conservative Party of Mariano Rajoy in the weekend’s general election. Spanish borrowing costs remain around their highest levels since the start of the European sovereign-debt crisis.

In London the FTSE 100 index closed down -2.6% (or -140 points) at 5,222, the German DAX was down -3.4% (or -194 points) at 5,606 while in France the CAC was down -3.4% (or -102 points) at 2,895. Spain was down -3.5% and Italy was down -4.7%.

Asian Markets

Asian stock markets continued their slide. Investors continued to head for the exits, as the debt issues in the eurozone and the US remain in focus.

Across the region the financials led the falls as economic growth forecasts were ratcheted down again. In Japan data showed that the country swung back to a trade deficit in October, missing forecasts that had tipped a surplus. Resource stocks also sold off after Chinese Vice Premier Wang Qishan suggested the that global economy would certainly fall into recession.

In China the SSE Composite closed down -0.1% (or -1 point) at 2,415, while in Hong Kong the Hang Seng Index was down -1.4% (or -265 points) at 18,226 and in Japan the Nikkei 225 Index closed down -0.3% (or -27 points) at 8,348. The South Korean KOSPI was down -1.0% for the session, while the Indian market was down -2.6%.

Commodities

The Dollar Index was higher at 78.24 on a lower Euro, while the Australian Dollar last traded lower at 98.67. Commodities prices traded sharply lower.

For the session the benchmark crude NYMEX for December delivery was down -0.2% (or -$US0.22) to settle at $US97.45. Copper prices are seeking a support level as Copper for December delivery was down -3.0% (or -10.3 cents) at $US3.3160. December gold was down -2.7% (or -$US46.40) at $US1,674.

ASX News Today

BIS – Bisalloy Steel Group the steel plate supplier expects earnings in the current financial year to rise up to 50 per cent.

BOW – Bow Energy tells shareholders that the year has been challenging but there have been achievements.

IIN - Internet service provider iinet has confirmed its intention to buy Canberra-based TransACT for $60 million.

OST – Onesteel the steelmaker expects conditions for the Australian steel industry to remain challenging. These comments come after reports from Chinese steelmakers that they are also cutting steel production.

QAN – Negotiations between Qantas and two unions representing ground crew and long-haul pilots have collapsed, leaving the sides to face binding arbitration before Fair Work Australia the industrial relations arbitrator.

SEK – Online jobs website and education services provider Seek says it expects to post earnings growth in 2011/12.

MMX – Desperate times for Murchison Metals as it continues talks to sell its stakes in the beleaguered Oakajee port project and its sole producing mine in WA.

ORI – The ramifications over spill/discharge notifications continue over the Newcastle chemical leak.

Local Corporate Reporting

Challenger Limited (CGF) Full year 2011 AGM

Discovery Metals (DML) Full year 2011 AGM

Monadelphous Group (MND) Full year 2011 AGM

Navitas Ltd (NVT) Full year 2011 AGM

Qube Logistics Holdings (QUB) Full year 2011 AGM

Ridley Corporation (RIC) Full year 2011 AGM

Ex-dividend Date

OXX – Octanex NL

TRU – The Trust Comp Ltd

Market Summary

ASX – to open lower

US & UK/Europe – sharply lower

Commodities Stock Index down -1.6%
Gold Stocks Index down -1.4%
Oil Stocks Index down -1.6%

US ADRs – Broadly Lower

BHP down -2.8% & RIO down -5.1%; AWC down -3.9%
ANZ down -3.3% & NAB down -4.3%
NEM down -0.2%, JHX lower -1.6%, NWS down -1.4%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Dividend, European Markets, Ex Dividend, gold price, S&P500, Stock Market Analysis, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Traders Remain On Edge Globally

Monday, November 21st, 2011

* US markets are now hovering around their 50 and 200 day moving averages, and these levels need to hold in order to setup for a Christmas rally.
* European equities ended lower on Friday and for the week. Continuing concerns over the ability of eurozone leaders to garner support of their citizens, to take the necessary austerity measures in order to resolve the ongoing debt crisis that is increasing pressuring the global financial system.
* Asian stock markets dropped sharply Friday, due to renewed concerns over the worsening European debt crisis, as Italian and Spanish cost of debt funding soared. Traders are expected to remain cautious again today.
* Commodities prices traded sharp higher , as Gold prices higher to $US1,725 and while crude-oil closed down around $US98.

The SPI Futures is trading around the key pivot level of 4250, ended flat (or 1 points) at 4,182. The key levels for our index today are 4120 to 4300.

Our market has succumbed to the negative sentiment from the overseas traders last week and is now trading below its 50 day moving average. The line in the sand is around the 4150 level which has offered support for the past couple of months. The longer the market holds above the 4150 , the more important this level becomes.

Aussie traders again have been held hostage to what is happening in Europe, particularly in Italy, Greece and now Spain, as the PIIGS economies live up to their name. The Aussie market is holding on to key support levels, but is struggling to make gains, given the macro environment in which we do business.

We are seeing weakness in the banks now that that they have completed their dividend period, and we may be in for a move into retail and resource stocks as we head towards the year’s end. After another struggle between the bulls and the bears last week, the bears appear to be in control as we have broken below the 50 day moving average, which sits around 4200. The 200 day moving average, which sits around 4,410 still offers significant resistance for any positive momentum into the end of the year.

Aussie traders are again expected to trade cautiously today, following the negative leads from the US and European markets, as traders fears over the eurozone debt crisis continued to weigh on sentiment, as Italian and Spanish debt funding costs remain at unsustainable levels. We continue to have a busy week for AGMs and production reports, see below for details.

See below for ASX listed companies in the news today.

Economics News Today
* None.

U.S. Markets

US markets are now hovering around their 50 and 200 day moving averages, and these levels need to hold in order to setup for a Christmas rally. The November-December period is typically good for stocks, but we need to see the eurozone debt situation settle, before we can look forward to some Christmas cheer. Debt is also a major concern in the US, as Washington’s deficit-cutting Super Committee appears to be making little progress.

The US dollar has surged last week, in a flight to safety, and this has been weighing on commodities prices. The major metals have relinquished much of their recent gains, with gold finding resistance around the $US1,800 level and is now trading higher at $US1,725, but Crude oil stayed below $US100 per barrel and copper has pulled back to $US3.40 per pound.

The Dow Jones Index finished the week down -2.9%, its worst weekly decline in a month, and in now down -4.1% so far this month. In the broader market the S&P500 stock index was down -3.8% and the tech-heavy Nasdaq Composite dropped -4% for the week. In the sector performance the utility and financial stocks, while technology and energy stocks fell.

The ten company groups that make up the S&P index traded mixed with the Materials were up 0.5%, Energy sector were down -0.6%, Financials sector was up 0.3%, Technology sector was down -0.8% , Industrials were up 0.2%, while the Consumer Staples were down -0.1%.

The Dow Jones closed up 0.3% (or 25 points) at 11,796, the S&P 500 index closed down -0.1% (or -1 points) at 1,215 the Nasdaq ended down -0.6% (or -15 points) at 2,573, and the smaller cap Russell 2000 was up 0.1%.

European Markets

European equities ended lower on Friday and for the week. Continuing concerns over the ability of eurozone leaders to garner support of their citizens, to take the necessary austerity measures in order to resolve the ongoing debt crisis that is increasing pressuring the global financial system. The Stoxx 600 index fell 0.8%,and was down -3.7% weekly loss.

Italian and Spanish cost of debt remained at their highest level since the inception of the eurozone, while Spain held a general election on the weekend. Across the region banks weighed with Lloyds Bank down -2% and HSBC Holdings PLC declined 0.7% in London, while in Germany Deutsche Bank fell -1.2% and in France Societe Generale SA sank 1.7%.

Traders are finding it difficult to know what is next in store for the eurozone debt crisis. One report suggested that the European Central Bank lend (ECB) could supply money to the International Monetary Fund (IMF) which could be used to finance bailouts, in order to avoid regulatory restrictions that prevented the ECB from further direct bailing outs. However Germany and the European Central Bank remained opposed to such a suggestion, but discussions may begin soon amid a lack of other alternatives.

In London the FTSE 100 ended down -3.3% for the week, while in German the DAX down -4.3% last week, and in France the market ended down -4.8% as the dismal November performance continued.

In London the FTSE 100 index closed down -1.1% (or -60 points) at 5,363, the German DAX was down -0.9% (or -50 points) at 5,800 while in France the CAC was down -0.4% (or -13 points) at 2,997, Spain up 0.5% and Italy up 0.2%.

Asian Markets

Asian stock markets dropped sharply Friday, due to renewed concerns over the worsening European debt crisis, as Italian and Spanish cost of debt funding soared. Concerns over the eurozone have been a major drag on the Asian markets due the concerns over faltering global economic growth. Across the region financials and growth-sensitive resource stocks again traded lower.

In Hong Kong the Hang Seng was down -6.1%, in Japan markets were down -3.3%,in Korea markets were down -3.3%, while in China the Shanghai Composite retraced over -3.5% from their Monday open. The Chinese market is drifting down towards 2-year lows again.

In China the SSE Composite was closed down -1.9% (or -46 points) at 2,416, while in Hong Kong the Hang Seng Index was down -1.7% (or -326 points) at 18,491 and in Japan the Nikkei 225 Index was closed up -1.1% (or -105 points) at 8,375, South Korean KOSPI was down -1.9% for the session, while the Indian market was down -0.6%.

Commodities

The Dollar Index was higher at 78.06 on a lower Euro, while the Australian Dollar last traded lower at 99.83. Commodities prices traded higher.

For the session the Benchmark crude NYMEX for December delivery was down -1.3% (or -$US1.27) settle at $US97.79. Copper prices are seeking a support level as Copper for December delivery was up 0.6% (or 2.1 cents) at $US3.4045. December gold was up 0.3% (or $US4.90 at $US1,725.80.

ASX News Today

IIN – iiNet the internet service provider, has been granted a voluntary suspension of its shares pending news of a potential acquisition.

KMD – Kathmandu Holdings the outdoor clothing chain says sales jumped 16 percent in the first quarter of fiscal 2012, in line with expectations.

MCP – McPherson the kitchen goods marketer says it plans to split its consumer products and printing divisions to create two, separately listed companies.

ORI – Orica the explosives and mining services supplier says the closure of its Kooragang Island facility in Newcastle is costing $4 million in earnings each week.

QAN – Qantas faces the last day of arbitraion ordered by Fair Work Australia tribunal.

RIO - the Rio Tinto takeover fight for Canadian junior uranium explorer Hathor Exploration continues with Rio Tinto increasing its offer to $C654 million ($A636 million).

STO – Santos says it is holding on to its Barossa and Caldita gas fields in the Timor Sea, ruling out a sale of the assets to fund its liquefied natural gas (LNG) projects in Queensland and PNG.

TLS – Telstra Corporation says strong and profitable growth in mobile and broadband customer numbers will offset a higher than expected fall in revenue from its Sensis business in the current financial year.

Local Corporate Reporting
Bow Energy AGM
OneSteel AGM�
SEEK Ltd AGM

Ex-dividend Date

NCM – Newcrest Mining

Market Summary

ASX – to open flat

US & UK/Europe – lower

Commodities Stock Index down -0.2%
Gold Stocks Index down -1.4%
Oil Stocks Index down -0.3%

US ADRs – Broadly Lower!!…

BHP down -0.4% & RIO down -0.3%; AWC down -0.4%
ANZ down -0.8% & NAB down -0.7%
NEM down -1.2%, JHX up 3.4%, NW S down -1.0%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

BXB – Brambles the pallet supplier, has signed a $US135 million service agreement with PepsiCo.

Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Dividend, European Markets, gold price, S&P500, Stock Market Analysis, stockmarket, trading, US Market wrap
Posted in Morning Wrap, Stock Market Analysis | No Comments

Stock Market Analysis: Market Falls Ease – Focus Still On Italy

Friday, November 11th, 2011

* US stocks rose overnight in choppy trading, as Italy brought forward their planned vote on the required austerity measures.
* European stock markets closed mixed yesterday after experiencing heavy losses in the previous session due to fears over the eurozone debt crisis contagion, as Italian borrowing costs soared to crisis levels.
* Asian stock markets ended sharply lower yesterday in reaction to the debt funding problem in Italy. Across the region financial and resources stocks dropped on open. Markets are set to see some bargain hunting today.
* Commodities prices traded generally higher. Gold prices were lower at $US1,755 and crude-oil closed up around $US98.

The SPI Futures is trading around the key pivot level of 4250, ending up 0.5% (or 22 points) at 4,286. The key levels for our index today are 4220 to 4320.

Yesterday the Australian shares sold-off sharply on the open and spent the rest of the day flat. The sell-off was triggered by overseas traders jumping out of equities as the concern over the Italian debt crisis pushed the cost of Italian bonds above crisis levels at 7.6%.

Our market lost over $37 billion for the session. Shares in the All Ordinaries (XAO) generally eased again today, closing down -2.2% at 4307, as the S&P/ASX 200 (XJO) closed down -2.4% at 4244.

Locally employment rose with 10,100 more new jobs created in October, up for a second month, as more workers took up full-time jobs and the unemployment rate edged lower to 5.2 percent (from 5.3 percent previously). Employment growth slowed to 0.9 per cent in October compared to the same month in 2010.

Over in New Zealand things are not so rosy. The Reserve Bank of New Zealand (RBNZ) yesterday warned of rising risks of contagion as Italian borrowing costs reached breaking point on the escalating debt crisis in the euro zone. NZ’s earthquake-hit economy faces funding costs that are set to rise at a time when the government has little room to drive domestic demand because of a growing debt burden.

Chinese export growth has slowed due to the European debt crisis. Exports rose at a slower pace in October, as Europe’s sovereign-debt contagion has rolled on to threaten Italy and cast a shadow over the outlook for global growth. Overseas shipments rose 15.9 percent from a year earlier, while the trade surplus was $17 billion, (up from $14.5 billion in September) and imports climbed 28.7 percent.

Aussie traders are expected to be looking for bargains today, following the modest gains in the US and European markets, as traders’ fears over Italy’s severe debt funding problems eased and on the news that Italy is planning to bring forward the parliamentary vote on the required austerity measures bill. We continue to have a busy week for AGMs and production reports, see below for details.

US Markets

US stocks rose overnight in choppy trading, as Italy bought forward their planned vote for their required austerity measures. Sentiment was boosted by a reading on unemployment claims that indicated some progress, with the number of people filing applications for jobless claims dropping last week to the lowest level in 7 months. In economic news US import prices fell last month as fuel and food prices dipped, suggesting inflation is under control. The US trade deficit shrank unexpectedly in September, as a sharp drop in trade from the debt-laden eurozone was offset by a record level of exports.

In corporate news, Cisco surged 7.2% after the networking company reported fiscal first-quarter earnings and revenue that exceeded expectations and provided an upbeat outlook as the company turns around. The beleaguered Green Mountain Coffee Roasters plunged -38% after the coffee, tea and hot chocolate producer reported fiscal fourth-quarter revenue missed its own forecasts and Wall Street’s targets.

All ten company groups that make up the S&P index traded higher with Materials up 1.2%, Energy up 1.7%, Financials up 0.5%, Technology up 0.3%, Industrials up 1.2%, while Consumer Staples were up 0.9%.

The Dow Jones closed up 0.9% (or 113 points) at 11,894, the S&P 500 index closed up 0.9% (or 10 points) at 1,240, the Nasdaq ended up 0.1% (or 4 points) at 2,625, and the smaller cap Russell 2000 was down -4.8%.

European Markets

European stock markets closed mixed yesterday after experiencing heavy losses in the previous session, due to fears over the eurozone debt crisis contagion, as Italian cost of borrowing soared to crisis levels.

There were concerns that the French credit rating could be downgraded by Standard & Poor’s Ratings Services however the ratings agency issued a clarification in the form of a statement, saying that the French triple-A rating remains unchanged, and this buoyed investor sentiment.

Sentiment was further boosted by news of a new Greek prime minister after days of political wrangling. However reports, later denied, that German and French officials discussed plans for a radical overhaul of the European Union that would involve establishing a more integrated and potentially smaller euro zone, has the potential to hurt investor sentiment.

Officials are still cautious over Italy, which is the eurozone’s third largest economy, as it is too big to bail out. Italy presents a far bigger problem than Greece, as Italy makes up 17% of EC GDP, while Greece makes up 2% and Germany makes up 27% of EC GDP.

The current eurozone debt contagion crisis is going to take the combined efforts of the European Central Bank, the IMF and the euro zone bailout fund in order to save Italy from financial crisis. Traders speculated that the European Central Bank (ECB) had intervened to help prop up the Italian bond market, as the Italian borrowing rates on the secondary bond market eased from the crisis levels at 7.6% in the previous session.

In London the FTSE 100 index closed down -0.3% (or -16 points) 5,444, the German DAX was up 0.7% (or 38 points) at 5,868 while in France the CAC was down -0.3% (or -10 points) at 3,064.

Asian Markets

Asian stock markets ended sharply lower yesterday in reaction to the debt funding problem in Italy.

Across the region financial and resources stocks dropped on open, as the region extended a global market pullback triggered by a surge in Italian borrowing costs to record highs, deepening Europe’s debt crisis. Growth-sensitive resources plays around the region fell sharply.

In Hong Kong the Hang Seng Index plunged -5.3%, while China’s Shanghai Composite lost a more modest -1.8%. In Hong Kong, HSBC plunged -9.1%, hit by its European exposure and after it reported its third-quarter underlying pretax profit fell to US$2.96 billion (from US$4.6 billion a year earlier), hurt by sharply higher bad loan provisions at its US unit.

In China the SSE Composite closed down -1.8% (or -45 points) at 2,480, while in Hong Kong the Hang Seng Index was down -5.3% (or -1,050 points) at 20,014, and in Japan the Nikkei 225 Index was down -2.9% (or -254 points) at 8,500. The South Korean KOSPI was down -4.9% for the session, while the Indian market was down -1.2%.

Commodities

The Dollar Index was lower at 77.70 on a higher Euro, while the Australian Dollar last traded lower at 1.0145. Commodities prices traded higher.

For the session the benchmark crude NYMEX for December delivery was up 2.2% (or $US2.11) to settle at $US97.85. Copper prices are seeking a support level as Copper for December delivery was down -2.4% (or -8 cents) at $US3.3570. December gold was down -1.8% (or -$US32.00) at $US1,754.90.

ASX News Today

AIO – Asciano the ports and rail operator says it has performed well in uncertain economic conditions but warned it would be affected by a fall in economic activity.

EGP – Echo Entertainment Group the casino owner, says revenue was higher in the first quarter of the financial year, and earnings are expected to grow in the second half of the year.

FXJ – Fairfax Media chief executive Greg Hywood says trading conditions have not improved since the company delivered its FY11 full year results in August. J.B. Fairfax has sold his 9.7% stake in Fairfax Media for $193 milllion.

IAG – Insurance Australian Group estimates claims from floods in Thailand will cost about $50 million.

ORI – Orica says two railyard workers have been hospitalised after they were overcome by ammonia fumes in the latest leak from the Orica plant near Newcastle.

QRN – QR National the rail operator, reaffirmed its underlying earnings guidance despite a 10 per cent drop in coal volumes in the financial year to date.

SGM – Sims Metal Management expects a lift in first half profit but says scrap intake will be slower.

SGT – Australia’s number two telco Optus says it has posted a “resilient” first half result where net profit came in flat and operating revenue rose slightly.

TLS – Telstra has completed the issue of a 750 million euro ($A1.0 billion) bond issue, saying demand was strong.

WDC – Westfield Group has sold its 75 percent stake in the Broadmarsh shopping centre in Nottingham in the UK for STG55 million ($A86.86 million).

Local Corporate Reporting

Leighton Holdings (LEI)            Full year 2011 AGM
Abacus Property Group (ABP) Full year 2011 AGM
Infigen Energy (IFN)                Full year 2011 AGM
Fleetwood Corp Ltd (FWD)    Full year 2011 AGM

Ex-dividend Date

API – Australian Pharma

Market Summary

ASX – to open higher

US & UK/Europe – traded higher

�
Commodities Stock Index up 0.9%
Gold Stocks Index down -0.4%
Oil Stocks Index up 1.5%

US ADRs – Broadly Higher

BHP up 1.5% & RIO up 0.6%; AWC up 0.2%
ANZ up 0.2% & NAB up 1.9%
NEM down -0.2%, JHX up 0.9%, NWS 1.7%

By Michael Hevern
Head of Research

For Buy and Sell recommendations on ASX listed companies register for a FREE trial of MDS Financial Research.

Tags: ASX News, Business News, Commodities, Crude Oil, gold price, Mining Services, S&P500, Stock Market Analysis, stockmarket, trading, US Market wrap
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