Posts Tagged ‘S&P500’

    • Stock Market Analysis: Market Sell-off As Italy Is Too Big To Bail

    Thursday, November 10th, 2011

    * US stock markets sold-off strongly overnight, as stocks suffered their biggest 1-day decline since mid-September.  The sell-off was due to concerns that Italy is too big to bail out.
    * European stock markets dropped sharply. Italian bond yields soared to crisis levels as the key 10-year Italy bond yield topped 7.6% after margin requirement were raised.  The Stoxx Europe 600 index closed down -1.7%.
    * Asian stock markets ended mostly higher yesterday, as investors were positive over news of beleaguered Italian Prime Minister Silvio Berlusconi’s pledge to resign once the parliament passed the necessary austerity measures.
    * Commodities prices traded sharply lower, as Gold prices sank lower to $US1,774 and crude-oil closed down around $US95.

    The SPI Futures is trading around the key pivot level of 4250, ending down -2.5% (or -110 points) at 4,227. The key levels for our index today are 4180 to 4280.

    Yesterday Australian traders joined in on the optimism shown by their American counterparts who were buoyed by news that Italian Prime Minister Silvio Berlusconi planned to resign after the parliament passes the austerity measures, easing fears of a debt default by Italy. 

    The Australian Bureau of Statistics has reported that home loans have risen 2.2 percent higher for the sixth straight month in September, with more gains expected to flow through following the recent cut to interest rates.  However concerns remain that debt levels will prevent any dramatic growth in the housing market.  Shares in the All Ordinaries (XAO) generally eased again yesterday, closing up 1.1% at 4406, as the S&P/ASX 200 (XJO) closed up 1.2% at 4346.

    Aussie traders are expected to sell-off shares today, following the sharp falls from the US and European markets where traders sold-off as the cost of Italian debt soars to crisis levels.  We continue to have a busy week for AGMs and production reports, see below for details.

    Economics News Today

    * November Westpac Melbourne Institute Consumer SentimentSurvey
    * September Housing Finance Approvals
    * November DEEWR Monthly Leading Indicator of Employment.

    US Markets

    US stock markets sold-off strongly overnight, with stocks suffering their biggest 1-day decline since mid-September.  The sell-off was due to concerns that Italy is too big to bail out, as their cost of borrowing reaches disastrous levels over 7.5%, and the eurozone debt crisis rolls on. 

    The Dow Jones Index broke the 12,000 level, but is still up 1.8% for the year. In the broader markets the S&P 500 and the tech-heavy Nasdaq sold-off sharply down over -3.7%, and are in the negative for the year. Financials, materials and energy sectors all reversed their gains for the past week, while the defensive sectors including telecommunications, utilities, consumer staples and health-care stocks fared relatively better. 

    Financials sold off sharply with Morgan Stanley plunging -9%, JP Morgan falling -7.1% and Bank of America declining 5.7%. Sentiment was also hurt by a report that German Chancellor Angela Merkel’s party is trying to allow countries to leave the euro while remaining in the European Union, adding further to uncertainties.

    In corporate news, General Motors lost -11% after the automobile maker delivered a disappointing outlook, citing deteriorating economic conditions, while Adobe Systems fell -7.7% after the company said it would cut 750 jobs as part of a restructuring plan and provided a lower-than-expected revenue outlook. In retail Ralph Lauren fell -5.7% after the high-end apparel maker missed earnings expectations.

    All ten company groups that make up the S&P index traded lower with the Materials down -4.9%, Energy down -4.4%, Financials down -5.4%, Technology down -3.5%, Industrials down -3.9%, and Consumer Staples down -3.6%.

    The Dow Jones closed down -3.2% (or 389 points) at 11,780, the S&P 500 index closed down -3.7% (or -47 points) at 1,229, the Nasdaq ended down -3.9% (or -105 points) at 2,621, and the smaller cap Russell 2000 was down -4.8%.

    European Markets

    European stock markets dropped sharply overnight, as Italian bond yields soared to crisis levels with the key 10-year Italy bond yield topping 7.6% after margin requirements were raised.  The Stoxx Europe 600 index closed down -1.7%. 

    Across the region the banks led the falls, but mining shares also fell as commodity prices followed equity markets lower. The Euro fell sharply against the U.S. dollar which weighed on gold, crude-oil and copper prices. 

    The Italian market finished down -3.8% and is now down over -25% for the year, as Italian banks slumped over -4%. The selling began as traders came to terms with the fact that Italy – the third biggest European economy – is too big to bail out. The sell down came despite the announcement of Silvio Berlusconi’s decision to resign as prime minister pending the Italian parliament’s approval of austerity measures.

    In Greece the market was down -1.6%, as the Greek PM said the country will implement its latest bailout plan.  

    In London the FTSE 100 index closed down -1.9% (or -107 points) 5,460, the German DAX was down -2.2% (or -132 points) at 5,829, while in France the CAC was down -2.2% (or -68 points) at 3,075. 

    Asian Markets

    Asian stock markets ended mostly higher yesterday, where investors were positive over news of Silvio Berlusconi’s pledge to resign once the parliament passed the necessary austerity measures. However Italian borrowing costs are skyrocketing to dangerous levels.  

    Chinese data shows that the Chinese inflation rate fell to a five month low, as gains in food costs eased, giving the Chinese government room to ease fiscal and monetary policies and to stimulate economic growth, as the spectre of the European debt crisis looms. The CPI rose 5.5 percent in October, down from a 6.1 percent gain in September, and in line with expectations. Producer prices increased 5 percent in October, the smallest gain for a year. 

    Across the region, growth-sensitive resources plays were broadly higher, and financials were steady.  

    In Japan the Nikkei Stock Average rose 1.2%.  Olympus shares closed limit-down level for the second straight session, plunging another -20%, after the company admitted to concealing securities losses since the 1990s.

    In China the SSE Composite was closed up 0.8% (or 21 points) at 2,525 as Chinese inflation shows signs of slowing, raising expectations policy may be eased. In Hong Kong the Hang Seng Index was up 1.7% (or 336 points) at 20,014 and in Japan the Nikkei 225 Index closed up 1.2% (or 100 points) at 8,755. The South Korean KOSPI was up 0.2% for the session, while the Indian market was down -1.2%.

    Commodities

    The Dollar Index was higher at 77.94 on a lower Euro, while the Australian Dollar last traded lower at 1.0149. Commodities prices traded sharply lower.

    For the session the benchmark crude NYMEX for December delivery was down -0.9% (or -$US0.84) to settle at $US95.96.  Copper prices are seeking a support level as Copper for December delivery was down -3.4% (or -12 cents) at $US3.4120.  December gold was down -1.4% (or -$US24.20) at $US1,774.20. 

    ASX News Today

    CSR – CSR the building products manufacturer, says first half profit is up 13 percent and the company expects a full year profit at the lower end of market forecasts.

    DOW – Downer EDI the train manufacturer and engineering firm, has confirmed that full year net profit will recover to $180 million from the previous year’s net loss.

    LLC – Lend Lease the construction and property group, says the outlook for most of its key sectors is positive, but weak sentiment and overseas economic problems could impact the business.

    MYR – Myer reported a fall in 1Q sales of 5.1 percent. Myer said that November sales of Christmas-related products were typically a good leading indicator about the strength of sales in December, and are showing good signs at this time. 

    SPN –  SP AusNet the electricity and gas transmission network owner, says first half profit has fallen by 12 per cent, but the company expects to maintain its full year dividend level.

    SUN – Suncorp Group says the bank’s credit quality remains stable, despite the impact of Queensland’s flooding and cyclones in early 2011 and volatile investment markets.

    SVW – Seven Group Holdings expects its first-half profit to be between $140 million to $150 million higher than for the same period last year (up from $128 million).  The group’s WesTrac business in Australia and China is expected to record revenue growth of more than 20 per cent.

    Local Corporate Reporting

    Echo Entertainment Group (EGP) Full year 2011 AGM 

    Asciano Ltd (AIO) Full year 2011 AGM 
    Fairfax Media (FXJ) Full year 2011 AGM 
    Gindalbie Metals (GBG) Full year 2011 AGM 
    TFS Corp (TFC) Full year 2011 AGM 
    Brambles Industries (BXB) Full year 2011 AGM 
    Medusa Mining Ltd (MML) Full year 2011 AGM 
    QR National Limited (QRN)Full year 2011 AGM 
    Sims Metal Management (SGM) Full year 2011 AGM 
    Specialty Fashion Group (SFH) Full year 2011 AGM 

    Ex-dividend Date

    ANZ – ANZ Bank
    NAB – National  Bank
    ZGL – Zicom Group 

    Market Summary 

    ASX – to open sharply lower
    US & UK/Europe –  traded lower

    Commodities Stock Index  down -4.9%
    Gold Stocks Index down -0.8%
    Oil Stocks Index  down -4.7% 

    US ADRs – Broadly Lower

    BHP  down -6.2% & RIO down -6.2%; AWC down -6.9%
    ANZ down -4.4% & NAB down -5.0%
    NEM  down -3.3%, JHX down -4.4%, NWS down -4.8%

    By Michael Hevern
    Head of Research

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

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    Stock Market Analysis: European Sentiment Drives Global Markets

    Monday, November 7th, 2011

    * US stock markets fell on Friday, for the worst week in six, as the European debt crisis dominated sentiment.  The Dow Jones Index fell -2% for the week.  In the broader markets the S&P 500 and the tech-heavy Nasdaq down -2.6% and -1.8% for the week.
    * European stock markets finished broadly lower, ahead of the planned Greek confidence vote and as traders monitored the developments in Italy for possible signs of contagion of the debt crisis.
    * Asian stock markets were broadly higher on Friday, following on from the positive leads from the U.S.  European news has been driving sentiment and traders were kept on edge as the political turmoil in Greece kept the stocks under pressure last week. At this point the Greek PM has survived a no-confidence vote, but Greece has still have not approved the EU bailout measures, so this is set to weigh on sentiment into this week.
    * Commodities prices traded lower, as Gold prices lower to $US1,758 and while crude-oil closed up around $US94.

    The SPI Futures is trading around the key pivot level of 4250, ended down -0.6% (or -27 points) at 4,258. The key levels for our index this week are 4130 to 4440.

    Friday, the Australian share market gave up early gains, as the gloom from overseas traders seeped into our traders’ psyche, after news of the Greek political situation.  This has a potential to cast a shadow over any Christmas Rally.  Retail sales grew for the third straight month in September up 0.4 percent, following a rise of 0.6 percent in August and providing a sign of optimism for the domestic economy. The recent RBA interest rate cut to 4.5%, the first since April 2009, should support the consumer sector as we move into the Christmas period.  Shares in the All Ordinaries (XAO) generally eased again, closing down -0.3% at 4238, as the S&P/ASX 200 (XJO) closed down -0.3% at 4172.

    Aussie shares are expected to ease today, following the caution shown in US and European markets,  as traders chose caution as the Greek political situation unravels and the surprise ECB interest rate cut indicating that the  eurozone growth is faltering.  In the U.S. the FOMC decided to kept rates on hold as expected and there were no changes to its maturity extension program “operation twist.”, and the unemployment came in modestly lower.  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
    *  ANZ Job data

    U.S. Markets

    US stock markets fell for the worst week in six, as the European debt crisis dominated sentiment. 

    The Dow Jones Index fell -2% fro the week.  In the broader markets the S&P 500 and the tech-heavy Nasdaq down -2.6% and -1.8% for the week.  Financial stocks led the markets lower, but indutrials, technology and healthcare stocks also weighed on sentiment. 

    Stocks slumped from the outset but did recover as the day progressed.  The Group 20 (G-20) meeting of the industrial and developing economies ended without new pledges of support for the eurozone rescue plan. Also,  Italy has asked for international supervision of its austerity program, which kept traders on the defensive.

    The Non-Farm employment report showed a modest job creation in October and upward revisions to previous months’ figures, as the unemployment rate edged down to 9% (from 9.1%). 

    The US dollar has been very volatile this week as the US dollar index has ranged between below 75 to jump up above 78. The US dollar drives commodity prices and crude-oil and gold prices are trading at 5-week highs.

    All ten company groups that make up the S&P index traded lower with the Materials were down -0.2%, Energy sector were down -0.1%, Financials sector was down -1.4%, Technology sector was up 2.4% , Industrials were down -0.8%,  while the Consumer Staples were down -0.4%.

    The Dow Jones closed down -0.5% (or  -61 points) at 11,983, the S&P 500 index closed down -0.6%  (or -8 points) at 1,253 the Nasdaq ended down -0.4% (or -12 points)  at 2,686.

    European Markets

    European stock markets finished broadly lower, ahead of the planned Greek confidence vote and as traders monitored the developments in Italy for possible signs of contagion of the debt crisis. The Stoxx Europe 600 dropped -1% on Friday and down -7% for the week. 

    In London the FTSE 100 ended down -2.9% for the week, while in German the DAX slumped -6.2% last week, its worst weekly loss since mid-September.  Traders are growing increasingly concerned that the Greek implementation issues are spilling over into Italy, where government bond yields have recently soared to euro-era highs over 6% ,this was despite efforts by the European Central Bank intervention to buy the Italy’s bonds. 

    The euro dollar has plummeted this week from near 2-month high above $1.42, to finished down around $US1.38 after Greece called for a referendum over the EU bailout package and the surprise interest rate cut but the ECB.  At this point the Greek PM has survived a no-confidence vote, but they still have not approved the EU bailout measures.

    In London the FTSE 100 index closed  down -0.3% (or -19 points) 5,527, the German DAX was down -2.7% (or -167 points) at 5,966 while in France the CAC was  down -2.3% (or -72 points)  at 3,124. 

    Asian Markets

    Asian stock markets were broadly higher on Friday, following on from the positive leads from the U.S. 

    In Japan the Nikkei Stock Average ended down -2.7% after holiday shortened trading week, this was the worst weekly performance in four.  In Hong Kong the Hang Seng was down -1% for the week. In China the Shanghai Composite added 2.2% and has bounced off 2-year lows, and the index has finished higher in three of the past four weeks. 

    European news has been driving sentiment and traders were kept on edge as the political turmoil in Greece kept the stocks under pressure last week, as investors waited for the outcome of a Greek no-confidence vote that could determine whether the country will comply with the terms of a recently crafted financial rescue package.

    At this point the Greek PM has survived a no-confidence vote, but they Greece has still not approved the EU bailout measures, so this is set to weigh on sentiment into this week.

    In China the SSE Composite was closed up 0.8% (or 20 points) at 2,528, while in Hong Kong the Hang Seng Index was up 3.1% (or 600 points)  at 19,842 and in Japan the Nikkei 225 Index was closed  up 161 (or 1.9%) at 8,801, South Korean KOSPI was up 3.1%  for the session.

    Commodities

    The Dollar Index was higher at 76.96 on a lower Euro, while the Australian Dollar last traded lower at 1.0378. Commodities prices traded lower.

    For the session the Benchmark crude NYMEX for December delivery was up 0.2% (or $US0.19) settle at $US94.42.  Copper prices are seeking a support level as Copper for December delivery was down -0.5% (or 2.2 cents) at $US3.5650.  December gold was  down -0.5% (or -$US8.90) at $US1,758.00. 

     
    ASX News Today

    ANZ – ANZ Bank has increased its full-year profit by 19 percent to $5.36 billion, but says market volatility and consumer caution is likely to be a factor for some time. ANZ’s reported underlying earnings, or cash profit, for the year to September increased by 12 percent from the previous year to $5.65 billion, and a 31 percent drop in ANZ’s provision for bad debts to $1.24 billion boosted the net profit for the year just ended, while all divisions posted profit growth.

    BLD – Boral the building products maker, says its first half performance in financial 2012 will be broadly similar to the second half of financial 2011.

    CKF – Collins Foods, owners of 119 KFC restaurants in Australia and 85 Sizzler outlets in Australia and Asia, said pro forma net profit was now expected at $8 million for the current half year, down from $10.3 million expected (when it listed in August).

    DOW – Downer EDI chief executive Grant Fenn will consider sourcing more products from China, despite the problems found in Chinese-built Waratah trains destined for NSW commuters under its troubled rolling stock contract.
     
    HIL – Hills Holdings expects a modest improvement in FY12 trading results.
    IRON_ORE was in the news again with UBS cutting its realised price forecast for iron ore sold by BHP Billiton and Rio Tinto for the December quarter to $US143 per tonne from $US166 per tonne as the industry moves towards more spot pricing.

    NWS – News Corporation the global media giant, has reported a slight fall in first-quarter net profit due to a number of one-off charges, but says the company is successfully navigating through unpredictable times. News Corp said net income, or net profit, for the three months to September 30, 2011, came in at $US738 million (down from $US775 million), while first-quarter revenue rose seven percent.  News Corp maintained its earnings guidance for 2011/12 after reporting a “great start” the current financial year.

    PPT – Perpetual the wealth manager is forecasting a drop in first half underlying profit due to falling equity markets.

    SHV – Select Harvests the almond producer has appointed former ABB Grain managing director Michael Iwaniw as chairman to succeed Curt Leonard.

    TSE – Transfield Services has secured $130 million in work with the defence industry.


    Local Corporate Reporting
    Orica Limited (ORI.AU)                     Full year 2011 Results
    Sims Metal Management Ltd (SGM)  Q1 2012 Activities Report
    Connecteast Group (CEU)                  Full year 2011 AGM

    Ex-dividend Date
    Collection House (CLH)
    Macquarie Group Ltd (MQG)
    Westpac Banking Corp (WBC)
     
    Market Summary
    ASX – to open lower
    US & UK/Europe –  traded lower

    Commodities Stock Index  up 0.1%
    Gold Stocks Index down -0.4%
    Oil Stocks Index  up 0.1% 

    US ADRs – Broadly Mixed!!…

    BHP down -0.1% & RIO up 0.1%; AWC up 0.7%
    ANZ down -1.3% & NAB down -0.7%
    NEM  up 0.1%, JHX down -1.3%, NWS down -0.5%

    By Michael Hevern
    Head of Research

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

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    Posted in Morning Wrap, Stock Market Analysis | No Comments

    Stock Market Analysis: Bulls Trapped As Market Sell-off

    Wednesday, November 2nd, 2011

    * US stock markets sold-off overnight, as concerns resurfaced over the eurozone bailout plan.  Stocks sold-off hard on the open but backed off session lows.
    * European stock markets plunged overnight, as investor confidence faltered.  The Stoxx Europe 600 index closed down -3.5%.
    * Asian stock markets ended mostly lower yesterday, as Chinese manufacturing data disappointed and eurozone debt crisis concerns resurfaced. Growth-sensitive stocks were sold-down.
    * Commodities prices traded sharply  lower, as Gold prices fell to $US1,714 and while crude-oil closed down around $US92.

    The SPI Futures is trading around the key pivot level of 4150, ended down -1.5% (or -63 points) at 4,168. The key levels for our index this week are 4100 to 4250.

    Yesterday, Australian shares continued their falls, as concerns resurfaced about the European debt crisis plus Chinese data disappointed.   Even the Reserve Bank’s 25 basis point cut in interest rate to 4.5 percent failed to inspire investors. The Reserve Bank has cut interest rates for the first time since April 2009 and should provide some relief to households and corporate borrowers, providing the banks pass the savings on.

    The Chinese Purchasing Managers’ Index (PMI) disappointed falling to 50.4 from 51.2 in September, according to the China Federation of Logistics and Purchasing.  PMI fell for the first time in three months and this is expected to pave the way to further easing by the Chinese government as the Slowing European PIIGS economies and the ever present eurozone debt crisis, are impacting Chinese exports to its biggest consumer base.  Shares in the All Ordinaries (XAO) generally eased again , closing down -1.5% at 4297, the S&P/ASX 200 (XJO) closed down -1.5% at 4233.  The S&P/ASX sectors all finished in the red today except for Telecoms up 0.3%.

    Aussie shares are expected to trade sharply lower again today, following the sharply negative leads from the US and Europe overnight, as investors reassessed  the announcement of the details of the European Commission’s commitment to the bank rescue plan and the sovereign debt resolution, particularly where is the money coming from and how long it will take to implement. The government will vote on the MRRT mining tax today.  We continue to have a busy week for AGMs and production reports, see below for details.  The RBA has cut interest rates as expected, for the first rate cut since April 2009. Retailers will be cheering the RBA decision, as a rate will mean that they can participate in a Christmas rally.

    See below for ASX listed companies in the news today.

    Economics News Today
    *  ABS Building approvals for September
    *  Australian Office of Financial Management (AOFM) to issue $700 million of April 2023 Treasury Bonds.

    U.S. Markets

    US stock markets sold-off overnight, as concerns resurfaced over the eurozone bailout plan.  Stocks sold-off hard on the open but backed off session lows.  The sell-of came after the Greek PM said Greece would hold a referendum over the bailout rescue plans. 

    Investors are acknowledging there will be problems in the quick implementation of the bailout plan across all the EU member nations. In economic news the U.S. manufacturing sector barely expanded last month, according to the Institute for Supply Management as spending on construction in the U.S. eked ahead during September, however the sector continues to struggle with weak demand for new projects. 

    The US dollar has surged higher in the past couple of session which is weighing on commodity prices across the board.  Investors were also cautious ahead of the Non-Farm Payrolls employment report for October and the Federal Reserve’s statement (FOMC) on monetary policy.
     
    All ten company groups that make up the S&P index traded sharply lower again with the Materials were down -2.6%, Energy sector were down -3.4%, Financials sector was down -4.6%, Technology sector was down -2.8% , Industrials were down -3.1%,  while the Consumer Staples were down -2.3%.
     
    The Dow Jones closed down -2.5% (or -297 points) at 11,657, the S&P 500 index closed down -2.8%  (or -19 points) at 1,218 the Nasdaq ended down -2.9% (or -77 points)  at 2,607, and the smaller cap Russell 2000 was  down -3.7%.

    European Markets

    European stock markets plunged overnight, as investor confidence faltered.  The Stoxx Europe 600 index closed down -3.5%. 
    The sell-off was sparked after news reports that the Greek debt deal hammered out last week was on the verge of collapse, as the Greek prime minister surprised the market by announcing a proposal for a referendum on the bailout package. The call for a referendum on the country’s second bailout package had wide ramifications which particularly hit the financials stocks across the region, as the Stoxx Europe 600 banks index ended down -6.2%.  The bankruptcy filing in New York by futures and derivatives broker, MF Global Holdings on Monday also weighed on sentiment in the financials sector. 
    The Stoxx Europe 600 basic resources index fell -3.5%, as the euro plunged to $US1.3610 while the 10-year yield on the bund slumped 27 basis points, while Italian yield spreads versus Germany hitting a new euro-era high. 
    In London the FTSE 100 closed -2.2%.  The German DAX-30 plunged -5% to finish below 6,000, while the French CAC-40 closed down -5.4% down to around 3,000.  In Greece the market finished down -6.9% and in Italy te market slumped -6.8%.
     
    In London the FTSE 100 index closed  down -2.2% (or -122 points) 5,421, the German DAX was down -5.0% (or -307 points) at 5,835  while in France the CAC was  down -5.4% (or -175 points)  at 3,068

    Asian Markets

    Asian stock markets  ended mostly lower yesterday, as China’s manufacturing data disappointed and eurozone debt crisis concerns resurfaced.

    Growth-sensitive stocks were sold-down after the Banks of Japan (BoJ) intervention to weaken the yen after the currency hit a record high against the US dollar, hurt commodities prices last night.

    Chinese manufacturing activity slowed and fresh euro-zone debt concerns emerged, weighing on growth-sensitive resources plays around   the region. Across the region growth-sensitive resources stocks sold-off, with copper prices declining around -2.3%.

    In Japan the Nikkei Stock Index lost -1.7%. In Hong Kong the Hang Seng Index fell -2.5%, while the Shanghai Composite Index ended flat. The Chinese Purchasing Managers’ Index (PMI) disappointed falling to 50.4 from 51.2 in September, according to the China Federation of Logistics and Purchasing.  PMI fell for the first time in three months and this is expected to pave the way to further easing by the Chinese government as the slowing European PIIGS economies and the ever present eurozone debt crisis, are impacting Chinese exports to its biggest consumer base.

    In China the SSE Composite was closed up 0.1% (or 2 points) at 2,470, while in Hong Kong the Hang Seng Index was down -2.5% (or -495 points)  at 19,370 and in Japan the Nikkei 225 Index was down -1.7% (or -153 points)  at 8,935, South Korean KOSPI was flat for the session, while the Indian market was down -1.3%.  The ASX market closed down-1.5% as the RBA cut its cash rate by 25 basis points, this is the first easing since April 2009.   

    Commodities

    The Dollar Index was higher at 77.29 on a lower Euro, while the Australian Dollar last traded lower at 1.0345. Commodities prices were sharply lower.

    For the session the Benchmark crude NYMEX for December delivery was  down -2.0% (or -$US1.82) settle at $US91.37.  Copper prices are seeking a support level as Copper for December delivery was down -3.6% (or -13.2 cents) at $US3.5130.  December gold was  down -0.8% (or -$US13.20) at $US1,718.30. 

     
    ASX News Today

    ASX – The ASX exchange operator’s 21-year monopoly on share trading is over after cheaper rival Chi-X quietly opened for business.

    CPB – Campbell Brothers has bought US-based environmental and food analytical group, Columbia Analytical Services (CAS), for $US33 million, as the company seeks to expand in the U.S.

    HVN – Harvey Norman fell after the company reported a drop of almost 20 percent in pre-tax earnings in the three months to September.  The figures showed a -3.8 percent drop in global sales from the previous corresponding period, to $1.48 billion. Sales in Australia were down -2.9 percent in the quarter and -2.8 percent over the year. They cited strength of the Australian dollar, price declines and intense competition as the reason for the sales declines.

    KZL – Kagara Ltd has begun talks with potential buyers of its nickel assets after its mining partner Western Areas indicated it was not interested in a purchase.

    QAN – Qantas shares ended 1.1% higher again today after news out yesterday that the Fair Work Australia tribunal had ordered the national carrier to put its planes back into the air, intervening in the nation’s most dramatic labour dispute in a decade. While Virgin Australia shares gave back -1.3% for the session.

    SUL – Super Retail Group has finalised its $610 million purchase of sports good retailer Rebel Group and appointed a former Rebel manager to drive growth in the business.

    SOL – Washington H Soul Pattinson’s second largest shareholder is pushing for a new director on the board due to concerns of a lack of independence at the diversified investment company.

    WBC – Westpac has moved to match the RBA, cutting its standard variable rate by 25 basis points to 7.61 percent, effective from 14 November, while the others of the big four followed suit as Commonwealth Bank, also lowered rates on a series of variable home packages by 25 basis points, trimming them to between 7.66 percent to 6.86 percent, effective Friday.

    WES – Wesfarmers has raised $500 million through the issue of fixed-rate medium-term notes.

    WOW – Woolworths will unveil an ambitious plan to double their group sales of private-label products at a strategy day tomorrow, bringing it closer to supermarkets in Britain and the US where the category dominates shelves and generates premium earnings.  The private-label products provide much higher margins for the corporate bottom line.

    Local Corporate Reporting
    BKI Investment Company  AGM 
    Coventry Group AGM

    Dominos Pizza Enterprises AGM 

    MGM Wireless AGM
    MIL Resources AGM
    Pharmanet Group AGM
    RedFlow AGM
    Transpacific Industries Group AGM
    Westpac Banking Corporation full year results

     

    MinRex Resources due to list on the ASX
    Ex-dividend Date

    None

     
    Market Summary
    ASX – to open sharply lower
    US & UK/Europe -  sold off sharply

    Commodities Stock Index  down -2.7%
    Gold Stocks Index up 0.2%
    Oil Stocks Index  down -2.3% 

    US ADRs – Broadly Lower!!…

    BHP down -6.1% & RIO down -2.7%; AWC down -1.5%
    ANZ down -3.3% & NAB down -4.6%
    NEM  down 0.9%, JHX down -4.0%, NWS down -3.6%

    By Michael Hevern
    Head of Research

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

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    Stock Market Analysis: Markets Set For Continued Gains

    Monday, October 31st, 2011

    * US stock markets finished marginaly higher Friday, extending the week’s staggering gains, as investors cheered the plans from European leaders to address the region’s debt crisis
    * European stock markets climbed higher for a fifth week, to notch up their longest run of gains in over 18 months.  The Stoxx Europe 600 index jumped 4.2% for the week, and is up 10% for October, while the Stoxx Europe 600 Bank index jumped 9.1% for the week.
    * Asian stock markets rallied, after European leaders announced a deal for private holders of Greek bonds to take a 50% writedown on the debt.
    * Commodities prices traded generally higher again, as Gold prices rose to $US1,738 and while crude-oil closed up around $US94.

    The SPI Futures is trading around the key pivot level of 4330, ended up 0.3% (or 13 points) at 4,362. The key levels for our index this week are 4280 to 4450.

    Friday, Australian shares fell steadily after the opening higher as prices eased after their spectacular run yesterday, following the news from the EU summit regarding the “comprehensive” bailout plan for the eurozone, as European leaders negotiated a debt deal for the region. The Aussie share market has surged around 5% for its best weekly gain in over 2-years.  We did see some short-term profit taking today though.

    However HSBC economist Paul Bloxham says it will be a close call on Melbourne Cup Day, as the Reserve Bank board decides on interest rates as we head into the Christmas shopping season.  This view in contrast with the enthusiasm show by Credit Suisse earlier this week, who said there is now a 100 percent market expectation of a 25 basis-point cut, with a 6 percent chance of a 50 basis-point rate, as our CPI came in line with expectations at +0.6% q/q and +3.5% y/y.

    The EU leaders have come out with their “comprehensive” plan to address the eurozone crisis.  Private investors have agreed to accept losses of 50 percent on their Greek bonds. Under the deal the Greek losses for investors will be about EUR100 billion and Greek debt will fall to 120 percent of GDP by 2020.  At the EU summit in Brussels, European leaders have agreed to force banks to raise EUR106 billion ($142 billion) by June, to ensure that they can weather the expected losses on Greek debt “haircut”.  EU leaders said they will boosting the size of the eurozone (EFSF) bailout fund to around $US1.4 trillion.  Shares in the All Ordinaries (XAO) generally eased today, closing up 0.2% at 4411, the S&P/ASX 200 (XJO) closed up 0.1% at 4353.

    Aussie shares are expected to continue higher today, following the sharply positive leads from the US and Europe last week, as investors cheered the announcemnet of the details of the European Commision’s commitment to the bank rescue plan and the sovereign debt resolution.  Chi-X will being its exchange operatiosn today, offering trading in 6 key stocks.  We continue to have a busy week for AGMs and production reports, see below for details.  The RBA meeting tomorrow and are expected to cut interest rates.  There is a rotation out of defensive stocks into stocks that are likely to participate in a Christmas rally.

    See below for ASX listed companies in the news today.

    Economics News Today
    *  October TD Securities Monthly Inflation Gauge
    *  September Financial Aggregates, incl Private Sector Credit
    *  September International Reserves & Foreign Currency.

    U.S. Markets

    US stock markets finished marginaly higher Friday, extending the week’s staggering gains, as investors cheered the plans from European leaders to address the region’s debt crisis. 
    The Dow Jones Index finished the week up 3.6% as the index completd its fifth straight week of gains, rising 14% in that time. The Dow is up 12% for October (up 5.7% for the year) and is on track for its biggest monthly percentage gain since 1987. 
    Investors cheered the European plan to address the Greek debt issues, expand the ESFS bailout facility to EUR1 trillion and recapitalize the region’s biggest banks.  In the broader market the S&P500 rose 3.8% for the week and has surged 14% in the past four weeks, while th e tech-heavy Nasdaq Composite finished the week up 3.8%.
    Traders will be keen watching confirmation of last week’s momentum, as the details of the EU plan still needs to be firmed up on the debt deal and the support from China and Japan for the bailout fund.  On the S&P500 1275 is the key level near-term. There is plenty of economic data including the ISM manuacturing report and the Non-Farm Payrolls employment report.
    The ten company groups that make up the S&P index traded mixed with the Materials were up 0.7%, Energy sector were up 0.7%, Financials sector was up 0.1%, Technology sector was 0.3% , Industrials were flat,  while the Consumer Staples were down -0.7%.
    The Dow Jones closed up 0.2% (or 23 points) at 12,231, the S&P 500 index closed up 0.1% (or  1 points) at 1,285, the Nasdaq ended down -0.1% (or -2 points)  at 2,737, and the smaller cap Russell 2000 was  down -0.6%.

    European Markets

    European stock markets climbed higher for a fifth week, to notch up their longest run of gains in over 18 months.  The Stoxx Europe 600 index jumped 4.2% for the week, and is up 10% for October.  The Stoxx Europe 600 Bank index jumped 9.1% for the week, while a gauge of the basic resource stocks jumped 11%.
    Across the region gains were across the broad-based, and the banking sector was the standout performer, as the new measures will force banks to raise their core tier 1 capital ratio.  
    In last week’s “risk on” rally, investors cheered the details of the deal by eurozone leaders to stabilize the region’s debt crisis.  The EU leaders have announced that the euro zone will provide Greece with another EUR100 billion in aid, while holders of Greek debt will be required to write off 50% of their holdings. EU leaders also agreed to expand the firepower of the European Financial Stability Facility (EFSF) to EUR1 trillion.  
    In London the FTSE 100 index closed  down -0.2% (or -12 points) 5,702, the German DAX was up 0.1% (or 8 points) at 6,346  while in France the CAC was  down -0.6% (or -20 points)  at 3,349.   
    For the week in London the FTSE 100 index rose 3.9%, led by the banks and the miners, while on the continent the Germany’s DAX surged 6.3%, as the French CAC-40 rose even further up 5.6%, with the bulk of the gains occurring on Thursday.

    Asian Markets

    Asian stock markets rose Friday, extending on from their surge from the previous session, after European leaders had announced their latest plans to contain the eurozone sovereign-debt crisis.

    Across the region the buying was broad-based, due to proposed measures announced at European summit, particularly growth-sensitive energy and materials sectors and the banks recovered strongly too. 

    In Japan the Nikkei Stock Average rose 1.4%, In Hong Kong the Hang Seng Index and in China the Shanghai Composite Indicies climbed another 1.6%. For the week Asian equities put in a strong performance, with the Hang Seng Index adding11%, and in China the Shanghai Composite jumped 6.7%, the Japanese Nikkei Average rose 4.3%, the Kospi climbed 5.0%, while in Australia the ASX 200 advancing 5.1%.

    In China the SSE Composite was closed up 1.6% (or 38 points) at 2,473, while in Hong Kong the Hang Seng Index was up 1.7% (or 330 points)  at 20,019 and in Japan the Nikkei 225 Index was up 1.4% (or 124 points)  at 9,050, South Korean KOSPI was up 0.4% for the session, while the Indian market was up 0.3%.   

    Commodities

    The Dollar Index was lower at 75.05 on a higher Euro, while the Australian Dollar last traded higher at 1.0704. Commodities prices eased.

    For the session the Benchmark crude NYMEX for December delivery was  down -0.4% (or $US0.41) settle at $US93.55.  Copper prices are seeking a support level as Copper for December delivery was up 0.4% (or 1.4 cents) at $US3.7120.  December gold was  down -0.1% (or -$US0.50) at $US1,743.10. 

     
    ASX News Today

    ASX – ASX shares held up despite the debacle of the computer crash on one of the busiest trading days of the year.

    FXJ – Fairfax Media says it will hold onto its metropolitan radio assets due to a lack of acceptable takeover offers.

    KCN – Kingsgate Consolidated the gold miner said production fell 11 percent in the September quarter as operations were hit by heavy monsoonal rains and a water shortage.

    MQG – Macquarie Group’s first half profit fell by 24 percent as the investment bank forecast that its full year result was likely to be lower than fiscal 2011 if market conditions remained unchanged.

    MQG –  Macquarie Group have announced a rare return of capital to shareholders, outlining plans for a buyback up to 10 percent of its shares.  The company will spend some of it $3.5 billion of excess cash, approximately $880 million in the exercise, as chief executive Nicholas Moore bets on a recovery on global markets.The buyback will be partially funded by a hybrid shares issuance and like most banks, will need to get the nod from the bank regulator.

    QAN  - Qantas says the industrial action taken by the licensed engineers, pilots and Transport Workers unions has cost the airline $68 million to date.

    STO – Santos has agreed to sell its entire working interest in the Evans Shoal gas field in the Bonaparte Basin offshore northern Australia for up to $US350 million ($A327 million).

    WHC – Whitehaven Coal says first quarter coal production rose by 24 percent and sales were up by 17 percent.


    Local Corporate Reporting
    AMP Ltd (AMP)                Q3 2011 Trading statement 
    Aquila Resources (AQA)       Quarterly Activities Report 
    Aston Resources Ltd (AZT)    Quarterly Activities Report 
    Beadell Resources (BDR)      September Quarterly Report 
    Bathurst Resources (BTU)     Quarterly Activities Report 
    Dart Energy (DTE)            Quarterly Activities Report 
    Dexus Property Group (DXS.AU)  Full year 2011 AGM 
    Gryphon Minerals (GRY)       September Quarterly Report 
    Harvey Norman Holdings (HVN) Q3 2011 Sales 
    Independence Group (IGO)     September Quarterly Report 
    Lynas Corporation (LYC)     September Activities Report
    Linc Energy (LNC)               Quarterly Activity Report 
    Mount Gibson Iron (MGX)   Q1 2012 Activities Report 
    Murchison Metals (MMX)   Q1 2012 Activities Report 
    Novogen Ltd (NRT)              Full year 2011 AGM 
    Origin Energy Ltd (ORG)     Quarterly Production Report 
    Perseus Mining (PRU)         September Quarterly Report 
    Platinum Australia (PLA)     September  Quarterly Report 
    Sandfire Resources (SFR)     Quarterly Activities Report 
    Sims Metal Management Ltd      Q1 2012 Activities Report 
    Sundance Resources (SDL)     Quaterly Activity Report 
    Ex-dividend Date
    CLX – CTI Logistics
     
    Market Summary

    ASX – to open modestly higher
    US & UK/Europe –  eased 

    Commodities Stock Index  up 1.5%
    Gold Stocks Index up 1.8%
    Oil Stocks Index  up 0.5% 

    US ADRs – Broadly Lower!!…

    BHP down -0.7% & RIO up %; AWC down -2.2%
    ANZ down -0.6% & NAB down -0.6%
    NEM  up 3.7%, JHX down -0.4%, NWS down -0.1%

    By Michael Hevern
    Head of Research

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

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    Stock Market Analysis: Giddy Up! – Bulls Charge On!

    Tuesday, October 25th, 2011

    * US stock markets jumped overnight, as the bulls pushed the market steadily higher throughout the day. U.S. stocks surged to their highest levels since early August.�
    * European stocks rose overnight, as investors cheered news that eurozone leaders were making progress toward agreeing measures to resolve the sovereign debt crisis.
    * Asian stock markets rose sharply overnight, as data pointed to an improvement in Chinese manufacturing activity.
    * Commodities prices traded sharply higher again, as Gold prices rose to $US1,650 and while crude-oil closed up around $US92.
    �
    The SPI Futures is trading around the key pivot level of 4200, ended up 0.8% (or 32 points) at 4,281. The key levels for our index today are 4320 to 4230.

    Yesterday, Australian shares surged higher, as investor sentiment was boosted by optimism over the prospect of a eurozone debt crisis resolution, after the weekend’s eurozone summit, and ahead of any announcements due on Wednesday night our time.  Stocks traded even higher in the afternoon after Chinese manufacturing figures showed a moderate pickup in October, which compares to contraction in the past three months. The HSBC Chinese Flash Purchasing Managers’ Index, rose to 51.1 in October (up from final reading of 49.9 in September), surpassing the 50-point level for the first time since July. The index is designed to give an early snapshot of the month’s factory activity. This was the first time since July that the reading came in above 50. This data underscores the resilience of the world’s second largest economy and will ease concerns that China is in for a hard landing and growth is backed by robust domestic demand.  The All Ordinaries (XAO) continued its gains today closing up 2.6% at 4314, the S&P/ASX 200 (XJO) closed up 2.7% at 4255.

    Aussie shares are expected to rise again today, following the positive leads from the US and Europe, as investors who showed their optimism that the European Commision’s commitment to the bank rescue plan and the sovereign debt resolution is progressing.  Also Chinese PPI data shows a robust economy. 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.

    U.S. Markets

    US stock markets jumped overnight, as the bulls pushed the market steadily higher throughout the day. 
     
    The Dow Jones Index and the S&P500 rose around 1%. The Nasdaq Composite over 2% ad is now in positive teritory for the year.  In the broader markets materials and financials stocks led the gains.  
     
    Investors pushed stocks prices higher after some M&A activity and a lack of new negative news out of the European weekend summit.  In M&A Oracle rose 2%, and RightNow Technologies surged 19% after the Oracle the business-software company said it would buy the cloud computing firm in a deal valued at $US1.43 billion. Caterpillar shares jumped 4.8% after the maker of construction and mining equipment reported better-than-expected third-quarter earnings and raised its outlook for the year.
     
    Commodity prices rose sharply with copper rising to monthly highs and crude-oil surging above $US92 per barrel.
     
    All ten company groups that make up the S&P index traded higher  with the Materials were up 2.4%, Energy sector were up 1.3%, Financials sector was up 2.6%, Technology sector was up 1.6% , Industrials were up 1.9%,  while the Consumer Staples were up 1.5%.
    The Dow Jones closed up 0.9% (or 105 points) at 11,914, the S&P 500 index closed up 1.3% (or  15 points) at 1,2254, the Nasdaq ended up 2.4% (or 62 points)  at 2,699, and the smaller cap Russell 2000 was up 3.3%.

    European Markets

    European stocks rose overnight, as investors cheered news that eurozone leaders were making progress toward agreeing measures to resolve the sovereign debt crisis. The European Stoxx 600 index climbed 1.3%. 
     
    Across the region miners led gains following data from China showing an expansion in the manufacturing sector in October, but banks also traded higher on hopes of a bank rescue package out of the EU summit.  European Union leaders have reported that thay are making progress and will announce a comprehensive package of measures to tackle the debt crisis Wednesday. The package is expected to center on recapitalising European banks, addressing the Greek debt crisis and boosting the size of the European Financial Stability Facility (EFSF), the eurozone rescue fund. 
     
    In London the FTSE 100 index rose 1.1%, whole the German DAX-30 and the French CAC-40 rose over 1.4%.  The Greek market bucked the positive trend, as it plunged -4.5% as Greek banks sold off heavily with a numbr of banks down over -20% on concerns that institutions will have to take a “hair-cut” of over 50% on Greek debt issues.
     
    In economic news the preliminary composite purchasing managers index disappointed as the PMI for the euro zone fell to 47.2 in October, which is a second successive monthly contraction of the private-sector economy and the fastest rate of decline since July 2009.
     
    In London the FTSE 100 index closed up 1.1% (or 59 points) 5,548, the German DAX was up 1.4% (or 84 points) at 6,055  while in France the CAC was up 1.6% (or 49 points)  at 3,220.

    Asian Markets

    Asian stock markets rose sharply overnight, on hopes that the European leaders are making progress on a plan to contain the euro-zone debt crisis and as data pointed to an improvement in Chinese manufacturing activity. 

    The buyers stepped from the outset, in as EU leaders sais that the European Union summit on the eurozone debt crisis that a broad agreement is taking shape. Asian equity markets were boosted by the news from the European summit developments, and extended their gains after Chinese data suggested the key manufacturing sector has returned to expansion after a recent slowdown.

    Preliminary results from a monthly survey of Chinese manufacturing climbed to a five-month high of 51.1 points in October, according to a survey released by HSBC Monday.  Growth-sensitive shares surgd as the resource sector companies were among the best performers, helped by gains in commodity prices. In Japan the Nikkei Stock Index rose 1.9%. In Hong Kong the Hang Seng Index surged 4.1% and in China the Shanghai Composite Index closed 2.3% higher.

    In China the SSE Composite was closed up 2.3% (or 53 points) at 2,370, while in Hong Kong the Hang Seng Index was up 4.1% (or 746 points)  at 18,771 and in Japan the Nikkei 225 Index was up 1.9% (or 165 points)  at 8,844, South Korean KOSPI was up 3.3% for the session, while the Indian market was up 0.9%.   

    Commodities

    The Dollar Index was lower at 76.12 on a higher Euro, while the Australian Dollar last traded lower at 1.0478. Commodities prices were sharply higher again.

    For the session the Benchmark crude NYMEX for December delivery was up 4.7% (or $US4.15) settle at $US91.55.  Copper prices are seeking a support level as Copper for December delivery was up 7.1% (or 22.8 cents) at $US3.4030.  December gold was up 1.0% (or $US16.40) at $US1,650.40. 

     
    ASX News Today

    AIO – Asciano the ports and rail operator, has no debts due until fiscal 2015 after refinancing $1.45 billion in bank facilities.

    BMN – Bannerman Resources the Namibia-focused uranium explorer will continue to shop around for alternative corporate deals to the $144 million takeover bid by China’s Hanlong Mining.

     
    PXS – Pharmaxis the dDrug developer, has moved closer to securing approval to market its cystic fibrosis drug, bronchitol, in Europe.
    ORG – Origin Energy reaffirmed their forecast 30 percent rise in underlying profit this financial year and again defended its coal seam gas operations, and sees 35 percent growth in underlying earnings in the 2011/12 financial year.
     
    RIO – Rio Tinto has reported iron ore demand remained robust despite market weakness, and said a fall in prices was accelerating a move to shorter-pricing methods. Rio is speeding up a program to lift output by 50 percent to 333 million tonnes a year by 2015, said its iron business was set to grow substantially over the next five years and industrial production in China remained robust.
    TLS – NBN Co chief Mike Quigley says he would be concerned if the competition watchdog and Telstra were unable to agree on structural separation undertakings by December 20.


    Local Corporate Reporting
    Foster’s Group (FGL)        Full year 2011 AGM
    Billabong (BBG)             Full year 2011 AGM
    GPT Group (GPT)             Q3 2011 Ex-dividend date
    GWA Group Limited (GWA)     Full year 2011 AGM
    Lynas Corporation (LYC)     September Activities Report
    Mcmillan Shakespeare (MMS)  Full year 2011 AGM
    Mirabela Nickel Ltd (MBN)   September Trading statement
    Pacific Brands Ltd (PBG)    Full year 2011 AGM
    Transurban Group Ltd (TCL)  Full year 2011 AGM
    Treasury Wine Estates       Full year 2011 AGM
    Resource Generation (RES)   September Quarterly Report
    Stockland (SGP)             Full year 2011 AGM
    Southern Cross Media (SXL)  Full year 2011 AGM
    WorleyParsons Ltd (WOR)     Full year 2011 AGM

    Ex-dividend Date

    CGO – CPT Global Limited

    Market Summary

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

    Commodities Stock Index  up 2.6%
    Gold Stocks Index up 4.2%
    Oil Stocks Index  up 0.7% 

    US ADRs – Broadly Higher!!…

    BHP up 5.8% & RIO up 8.1%; AWC 9.6%
    ANZ up 3.% & NAB up 3.4%
    NEM  up 1.9%, JHX up 6.7%, NWS up 1.6%

    By Michael Hevern
    Head of Research

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

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    Stock Market Analysis: Traders Cautious in US and European Markets

    Wednesday, October 12th, 2011

    * US stock markets closed the session flat. Investors were cautious ahead of the EFSF bailout vote in Slovakia.
    * European stock markets closed mostly lower overnight, as Slovakia delays a vote on plans to expand the European Financial Stability Facility (EFSF) rescue fund. The Stoxx Europe 600 index fell -0.3%.
    * Asian stock markets traded higher again yesterday, and the Chinese government moves to shore up financial system.
    * Commodities prices traded lower. Gold prices fell to $US1,664, while crude-oil closed up around $US85.

    The SPI Futures is trading around the key pivot level of 4080, ended down -0.1% (or -6 points) at 4,232. The key levels for our index today are 4275 to 4150.

    Yesterday Australian shares saw some profit taking, as investors cashed in some of the stellar gains of the past week. The key Aussie indices nudged up another 0.6% to complete a fifth session of gains.  Traders started the day off with a surge following on from the positive leads from the US and Europe, however caution soon set in as profit-takers decided to bank some of the recent gains.The All Ordinaries (XAO) continued with its rebound yesterday, up 0.6% at 4289, and the S&P/ASX 200 (XJO) closed up 0.6% at 4228.

    Aussie investors are expected to continue to to be cautious today, following the muted leads from the US and Europe, as investors took some profits off the table.  The Carbon Tax is expected to be passed in the Lower House today. The French and German leaders have still not detailed the action they will take to resolve the eurozone’s banking and sovereign-debt crisis and the EFSF is yet to get final approval.

    See below for ASX listed companies in the news today.

    Economics News Today

    *  October Westpac – Melbourne Institute Consumer Sentiment Survey
    *  October DEEWR Monthly Leading Indicator of Employment
    *  August Housing Finance and Approvals
    * The Carbon Tax Vote in the Lower House

    United States Markets

    US stock markets closed the session flat. Investors were cautious ahead of the EFSF bailout vote in Slovakia, the 17th and final country to act on an expansion of the euro zone’s rescue fund. Slovak lawmakers delayed a vote on expanding fund due to a split in domestic politics. The parliament of Slovakia, the poorest country in the euro zone, is expected to delay the vote on the plan, which will in turn delay the EFSF bailout implementation.

    All three major indices closed flat, after surging higher in the previous session. Interestingly this was the first session in 55 that this index’s daily trading range was less than 100 points.  Technology and Consumer Staple stocks led the gainers in the broader markets.  Alcoa, which unofficially kicks off the third-quarter earnings season after the closing bell, gained 1.7%.

    All ten company groups that make up the S&P index traded generally sharply lower: Materials were up 0.1%, Energy was up 0.3%, the Financials sector was up 0.2%, Industrials were up 0.4%, the Technology sector was up 0.4%, while Consumer Staples were up 0.4%.

    The Dow Jones closed down -0.2% (or -17 points) at 11,416, the S&P 500 index closed up 0.1% (or 1 points) at 1,195, the Nasdaq ended up 0.6% (or 14 points) at 2,580, and the smaller cap Russell 2000 was down -0.5%.

    European Markets

    European stock markets closed mostly lower overnight, as Slovakia delays a vote on plans to expand the eurozone the European Financial Stability Facility (EFSF) rescue fund. The Stoxx Europe 600 index fell -0.3%. 

    Investors took the opportuinity to do some profit-taking, cashing in on some of the strong recent gains, after the promise by the leaders of France and Germany to present a comprehensive plan to deal with the debt crisis.

    Greek banks plunged around -20% and were among the biggest decliners in the region.  The sell-off came as the troika of international lenders said that Greece is likely to receive its next tranche of aid in early November, but additional measures will be be needed to meet fiscal targets in 2013 and 2014.  The final vote on the EFSF and the Group of 20 (G-20) leading economies meeting on November 3 will be the next catalyst for the markets. 

    In London the FTSE 100 index ended flat (or -3 points) 5,396, as financials held on to recent gains but hedge-fund manager Man Group was down -2.8%. In Germany the DAX-30 was up 0.3% (or 18 points) at 5,865 while in France the CAC was down -0.3% (or -8 points) at 3,153.

    Asian Markets

    Asian stock markets traded higher again yestrday. 

    In Japan the Nikkei Stock Index played catchup and rose 2%, as exporters posted solid gains after traders retuned from a three-day weekend. In China the Shanghai Composite traded flat and remains at 2-year lows. 

    In Hong Kong the Hang Seng Index rose 2.4% as banking shares jumped after the Chinese state-run Central Huijin Investment bought shares in the country’s largest four banks in what is believed to be an effort to stabilise the Chinese financial system.  Agricultural Bank of China surged 12.8%, Bank of China gained, the Industrial & Commercial Bank of China added over 6.7% and China Construction put on 5.8%. China will be reporting Money Supply and Trade Balance data later this week, along with inflation data.

    In China the SSE Composite was closed up 0.2% (or 4 points) at 2,349, while in Hong Kong the Hang Seng Index was up 2.4% (or 430 points) at 18,141 and in Japan the Nikkei 225 Index was up 2.0% (or 168 points)  at 8,773. The South Korean KOSPI was up 1.6% for the session, while the Indian market was up 2.0%.

    Commodities

    The Dollar Index was lower at 77.49 on a higher Euro, while the Australian Dollar last traded higher at 99.95. Commodities prices were lower.

    For the session the benchmark crude NYMEX for December delivery was down -0.1% (or -$US0.11) to settle at $US85.30.  Copper prices are finding a support level as Copper for December delivery was down -2.2% (or -7.5 cents) at $US3.280.  December gold was down -0.6% (or -$US9.90) at $US1,664.20. 

    ASX News Today

    BHP –  South Australia’s peak mining group says federal and state government approval for BHP Billiton’s Olympic Dam expansion marks the arrival of the state’s long-awaited mining boom.

    EXT – Extract Resources is a step closer to a possible $2.2 billion takeover, as Chinese investors revealed Extract’s biggest shareholder said it was in talks with China Guangdong Nuclear Power Group.

    KZL – Kagara Ltd’s production of lead, zinc and nickel rose in the September quarter and some operating costs fell, in line with its newly-outlined strategy.

    QAN – Jetstar says it is disappointed check-in workers plan to take industrial action on Friday with their “no weigh day”.

    WIG – Steven Wilson is to step down as managing director of Wilson HTM Investment Group but will remain on the wealth manager’s board.

    WOW – New Woolworths chief executive Grant O’Brien will be paid $1.9 million in his first year in the job, but that could more than double with performance-based incentives.

    Local Corporate Reporting

    JB Hi-Fi Ltd (JBH)          Full year 2011 AGM
    Iluka Resources Ltd (ILU)   September Quarter Production & Exploration Report 
    The Reject Shop Limited     Full year 2011 AGM 
    Transurban Group            September Traffic Results  

    Ex-dividend Date

    TPM – TPG Telecom Limited

     

    Market Summary

    ASX – to open lower
    US & UK/Europe –  modestly Higher

    Commodities Stock Index  up 0.3%
    Gold Stocks Index up 0.2%
    Oil Stocks Index  down -0.5% 

     US ADRs – Broadly Lower

    BHP down -1.4% & RIO down -0.5%; AWC down -0.2%
    ANZ down -0.8% & NAB down -0.4%
    NEM  down -1.0%, JHX down -3.9%, NWS 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.

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    Stock Market Analysis: US and European Markets Rise On Hopes Of Debt Crisis Resolution

    Tuesday, October 11th, 2011

    * US stock markets rose sharply as investors cheered the news that the French and German leaders will take action to resolve the eurozone’s banking and sovereign-debt crisis.
    * European stock markets surged higher on optimism that European leaders will act to implement a rescue package for the eurozone banking system.
    * Asian stock markets ended mostly higher yesterday, although the Chinese traders were unimpressed.
    * Commodities prices traded higher, as Gold prices jumped to $US1,672 and while crude-oil closed up around $US85.

    The SPI Futures is trading around the key pivot level of 4080, ending up 1.3% (or -55 points) at 4,252. The key levels for our index today are 4275 to 4150.

    Yesterday Aussie stocks generally managed to hold on to their gains of last week, which was a solid performance given the weekend news about the eurozone bank downgrades. Fitch Ratings downgraded both Italy and Spain after the European close on Friday, and in London British banks came under selling pressure after Moody’s Investors Service downgraded 12 UK financial institutions and several Portuguese banks, citing increased risk from exposure to sovereign debt, deterioration of domestic asset quality and liquidity strains. 

    Locally it was a good news / bad news type of day, as the case for a rate cut when the Reserve Bank of Australia (RBA) meets next month, just got stronger. The latest ANZ job ads survey, which measures companies’ hiring intentions, dropped for a third straight month, down -2.1 percent in September following a revised -0.7 percent fall in August. According to Credit Suisse data, a rate cut to 4.5 percent is now a near certainty next month.

    The All Ordinaries (XAO) continued with its rebound yesterday up 0.9% at 4262, the S&P/ASX 200 (XJO) closed up 0.9% at 4198.

    Aussie stocks are expected to continue to see buying today, following the sharp positive leads from the US and Europe.

    See below for ASX listed companies in the news today.

    Economics News Today

    * September NAB Business Survey
    * The Carbon Tax Vote in the Lower House

    United States Markets

    US stock markets rose sharply as investors cheered the news that the French and German leaders will take action to resolve the eurozone’s banking and sovereign-debt crisis. U.S. bond markets were closed Monday for Columbus Day.

    The Dow Jones Index jumped 2.5% as all 30 component stocks ended higher. In the broader market the S&P 500 stock index and the tech-heavy Nasdaq jumped over 3.2%, as the financials led the gains surging 5.2%, with industrials, materials and energy sectors closely behind, up around 4%. The S&P 500 is now up over 11% from its recent low. 

    The buying spree was triggered by the news over the weekend that the French and German leaders are determined to have a “comprehensive package” by the end of October, to be resolved before the summit of the Group of 20 (G-20) leading economies in France, on November 3.

    Copper prices surged higher for a fourth straight session and prices are up nearly 13 percent from 14-month lows touched last week.  The US earnings season starts tonight. The euro dollar rose the most since March 2009 against the US dollar, after eurozone leads committed to act to rescue European banks. 

    All ten company groups that make up the S&P index traded generally sharply higher:  Industrials were up 3.5%, Materials were up 4.2%, Energy was up 4.5%, the Financials sector was up 5.2%, Consumer Staples were up 3.4%, while the Technology sector was up 3.1%.

    The Dow Jones closed up 2.9% (or 330 points) at 11,433, the S&P 500 index closed up 3.2% (or 37 points) at 1,192, the Nasdaq ended up 3.4% (or 84 points) at 2,563, and the smaller cap Russell 2000 was down -2.6%.

    European Markets

    European stock markets surged higher on optimism that the region’s leaders will act to implement a rescue package for the eurozone banking system.  The Stoxx Europe 600 index ended up 1.7%.

    Investors cheered the news that France and Germany would work to implement comprehensive measures to address the eurozone banking and sovereign debt crisis by the end of the month through the recapitalisation of the banking sector and a more robust eurozone rescue fund, the European Financial Stability Facility (EFSF). 

    The Stoxx Europe 600 banking index added 2.3%, with financial stocks leading the way after news of a plan to address the crisis at the Franco-Belgian bank Dexia, which includes an agreement to nationalise its Belgian unit and a EUR90 billion funding guarantee for the next 10 years.

    In London the FTSE 100 index closed up 1.8% (or 96 points) at 5,399 but trading volumes were down. The German DAX was up 3.0% (or 172 points) at 5,847 while in France the CAC was up 2.0% (or 64 points) at 3,161.

    Asian Markets

    Asian stock markets ended mostly higher yesterday.  In Japan the markets were closed for a holiday Monday. In Hong Kong the Hang Seng Index ended closed flat following a late session sell-off, but in China the Shanghai Composite Index was down -0.6% as traders returned from their week-long holiday. 

    Asian investors chose to ignore the fact that Italy and Spain were downgraded by Fitch and Moody’s Ratings agencies, and focused on the better-than-expected jobs data from the US and the reassurances from eurozone leaders that they will act to rescue the eurozone banking system.

    In China the SSE Composite was closed down -0.6% (or -14 points) at 2,344, while in Hong Kong the Hang Seng Index was up 0.1% (or 4 points) at 17,711 and in Japan the Nikkei 225 Index was closed at 8,605. The South Korean KOSPI was up 0.4% for the session, while the Indian market was up 2.0%.

    Commodities

    The Dollar Index was lower at 77.53 on a higher Euro, while the Australian Dollar last traded higher at 99.94. Commodities prices were higher.

    For the session the benchmark crude NYMEX for December delivery was up 3.4% (or $US2.79) settle at $US85.80.  Copper prices are finding a support level as Copper for December delivery was up 2.9% (or 9.6 cents) at $US3.2600.  December gold was up 2.2% (or $US35.10) at $US1,672.70. 

    ASX News Today

    CBD – Renewable energy company CBD Energy will buy Victorian-based energy retailer, Neighbourhood Energy, from Alinta Energy for $24.9 million.

    CSV – CSG, the info-tech company, has received new takeover interest following a $340 million takeover offer from an unnamed bidder last week.

    FML – Focus Minerals the gold producer has maintained its production target of more than 200,000 ounces of gold annually after completing its $68 million take-over of Crescent Gold.

    MAP – MAP Group has completed an asset swap agreement with a Canadian pension fund, leaving an 85 percent stake in Sydney Airport as its sole asset.

    EXS – Exco Resources, the gold miner, does not want to develop its Mt Colin copper and gold deposit in Queensland and may sell it.

    QAN – Qantas continues to face disruption, as the union representing customs workers says a series of national stoppages planned for next week will go ahead unless a satisfactory pay deal is reached.

    MCC – Macarthur Coal say the Peabody and Arcelor-Mittal take-over has been extended the offer period to 28 October.

    SGM – Sims Metal Management, the metal recycler, will take advantage of current market volatility and buy back up to 10 percent of its own shares.

    WEB – Webjet the online travel agency says the value of its ticket sales in the three months to September was up by 25 percent on the same period last year.

    Local Corporate Reporting

    Woolworths (WOW) Q1 2012 Sales 

    Ex-dividend Date

    ALR – Aberdeen Leaders
    AVG – Aust Vintage Limited
    KSC – K & S Corporation
    MCE – Matrix C & E Limited
    UOS – United Overseas Australia 
     

    Market Summary

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

    Commodities Stock Index up 3.0%
    Gold Stocks Index up 2.6%
    Oil Stocks Index  up 3.2% 

    US ADRs – Broadly Higher

    BHP up 3.9% & RIO up 4.4%; AWC up 1.8%
    ANZ up 4.5% & NAB up 4.6%
    NEM  up 2.8%, JHX up 3.6%, NWS 3.3%

    By Michael Hevern
    Head of Research

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

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    Stock Market Analysis: Eurozone Downgrades Dent Market Optimism

    Monday, October 10th, 2011

    * US stock markets ended lower on Friday, but had surged during the week.  Financial stocks fell sharply as the European sovereign debt problems overshadowed a stronger U.S. employment reading.
    * European stock markets rose last week, as optimism that Europe is ramping up efforts to shore up its financial system saw investors buy riskier assets, however banks were downgraded after the markets closed on Friday.
    * Asian stock markets ended higher for the week, although the Chinese market was closed for trading.
    * Commodities prices traded higher, as Gold prices fell to $US1,640 and while crude-oil closed up around $US82.

    The SPI Futures is trading around the key pivot level of 4000, ending down -0.6% (or -26 points) at 4,150. The key levels for our index this week are 4275 to 3950.

    Australian investors have enjoyed a spectacular rally last week, as the market piled on nearly $90 billion in value over the past few days. We finished the week strongly, as U.S. stock markets rose again on Friday night for a third straight triple-digit gain. The buying continued as European leaders took steps to address the eurozone debt crisis. The RBA left rates on hold this week and said it is willing to cut rates if the situation deteriorates in Europe. HSBC reported that Asian growth will “cool” to 7.3% for the next year (down from 7.5%) which is still very impressive. The All Ordinaries (XAO) continued with its rebound on Friday, up 2.3% at 4225 and the S&P/ASX 200 (XJO) closed up 2.3% at 4163.

    The eurozone finance ministers met last week and acknowledged that they need to do more to shore up the eurozone financial system, the ECB left rates on hold and proposed a bank rescue package.  However Moody’s downgraded UK and Portuguese banks over the weekend, plus Fitch Ratings Service has put Italy, Spain and Portugal on negative watch over their debt ratings.

    Aussie stocks are expected to see some profit taking today, following on from the late news about the eurozone bank downgrades.

    See below for ASX listed companies in the news today.

    Economics News Today

    *  September ANZ Job Ads
    *  September Official Reserve Assets

    United States Markets

    US stock markets ended lower on Friday, but surged during the week.  Financial stocks fell sharply as the European sovereign debt problems overshadowed a stronger US employment reading.

    The Dow Jones Index broke a streak of three straight triple-digit gains, but ended 1.7% higher for the week, and has been up 3 of the past 4 weeks. 

    In the broader market the S&P 500 ended 2.1% higher for the week (breaking a 2-week losing streak).  The tech-heavy Nasdaq Composite jumped 2.7% for the week. Investors pushed stocks higher early in the session, after the September non-farm payrolls rose more than expected and the very weak August reading was revised higher, but unemployment stubbornly remains at 9.1%.

    However sellers stepped in when the Fitch Ratings Agency issued ratings cuts for Italy and Spain, two large euro-zone economies that are also sovereign-debt trouble spots. The S&P 500′s financial sector was the worst performer plunging -3.7%, while consumer stocks rose after the jobs report, helping limit the overall losses. 

    All ten company groups that make up the S&P index traded generally sharply lower: Industrials were down -0.2%, Materials were down -1.5%, Energy was down -1.2%, the Financials sector was down -3.6%, Consumer Staples were down -0.1%, while the Technology sector was down -0.4%.

    The Dow Jones closed down -0.2% (or 20 points) at 11,103, the S&P 500 index closed down -0.8% (or -9 points) at 1,155, the Nasdaq ended down -1.1% (or -27 points) at 2,479, and the smaller cap Russell 2000 was down -2.6%.

    European Markets

    European stock markets rose last week, as optimism that Europe is ramping up efforts to shore up its financial system saw investors buy riskier assets, however banks were downgraded after market on Friday.  The Stoxx Europe 600 index added 0.8%, and jumped 2.6% for the week. However on Friday Fitch Ratings cut currency ratings on both Italy and Spain after the European markets closed.

    In London the FTSE 100 index gained 0.2%, and rose 3.4% for the week. However British banks came under selling pressure after Moody’s Investors Ratings Service downgraded 12 UK financial institutions. Citing that there is a lower probability that the government would/could support financial institutions if they need it, this time around.  Moody’s also downgraded several Portuguese banks, citing increased risk from exposure to sovereign debt, deterioration of domestic asset quality and liquidity strains. In Germany the DAX-30 index rose 0.5% on Friday, gaining 3.2% for the week, while the Fench CAC-40 index rose 3.8% for the week.

    In London on Friday the FTSE 100 index closed up 0.2% (or 12 points) 5,303, the German DAX was up 0.5% (or 30 points) at 5,675 while in France the CAC was up 0.7% (or 20 points) at 3,095.

    Asian Markets

    Asian stock markets ended higher for the week, although the Chinese market was closed for trading.  Banking stocks across the region recovered over the week, and mining stocks also saw some bargain hunting as commodities recovered. 

    In Japan the Nikkei Stock Index climbed 1% on Friday but was down -1.1% for the week but exporters and tech stocks rose. In Hong Kong the Hang Seng Index rallied 3.1% on Friday in a shortened week and was up 0.7% on the week, while the South Korean Kospi had another volatile week ending down -0.6% on the week.

    In Australia the S&P/ASX 200 index rose 3.9% for the week, after surging strongly after an early sell-off.

    In China the SSE Composite was closed at 2,359, while in Hong Kong the Hang Seng Index was up 3.1% (or 535 points) at 16,250 and in Japan the Nikkei 225 Index was up 0.9% (or 83 points) at 8,605. The South Korean KOSPI was up 2.9% for the session, while the Indian market was up 2.8%.

    Commodities

    The Dollar Index was lower at 78.73 on a higher Euro, while the Australian Dollar last traded higher at 97.74. Commodities prices were higher.

    For the session the benchmark crude NYMEX for December delivery was up 0.5% (or $US0.39) to settle at $US82.87.  Copper prices are finding a support level as Copper for December delivery was up 0.9% (or 2.8 cents) at $US3.0775.  December gold was down -1.1% (or -$US17.40) at $US1,636.10. 

    ASX News Today

    CBD – CBD Energy the renewable energy company will buy Victorian-based energy retailer, Neighbourhood Energy, from Alinta Energy for $24.9 million.

    CSV – CSG the info-tech company has received new takeover interest following a $340 million takeover offer from an unnamed bidder last week.

    FML – Focus Minerals the gold producer has maintained its production target of more than 200,000 ounces of gold annually after completing its $68 million take-over of Crescent Gold.

    MAP – MAP Group has completed an asset swap agreement with a Canadian pension fund, leaving an 85 percent stake in Sydney Airport as its sole asset.

    EXS – Exco Resources the gold miner does not want to develop its Mt Colin copper and gold deposit in Queensland and may sell it.

    QAN - Qantas contiues to face disruption, as the union representing customs workers says a series of national stoppages planned for next week will go ahead unless a satisfactory pay deal is reached.

    MCC – Macarthur Coal say the Peabody and Arcelor-Mittal take-over has been extended the offer period to 28 October.

    SGM – Sims Metal Management, the metal recycler, will take advantage of current market volatility and buy back up to 10 percent of its own shares.

    WEB – Webjet the online travel agency says the value of its ticket sales in the three months to September was up by 25 percent on the same period last year.

    Local Corporate Reporting

    None

    Ex-dividend Date

    BER – Berklee Limited
    CWP – Cedar Woods Properties
    IAW – Integrated Legal
    IDL – Industrea Limited
    MNY – Money3 Corporation
    NWH – NRW Holdings Limited
    WAX – WAM Research Ltd
    XRF – XRF Scientific
     

    Market Summary

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

    Commodities Stock Index down -2.0%
    Gold Stocks Index down -2.1%
    Oil Stocks Index down -0.8% 

    US ADRs – Broadly Mixed

    BHP down -0.4% & RIO up 1.1%; AWC up 1.4%
    ANZ up 2.9% & NAB up 2.0%
    NEM  down -1.5%, JHX down -0.6%, NWS up 1.8%

    By Michael Hevern
    Head of Research

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

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    Stock Market Analysis: Selling Eases Aided By Short Covering

    Monday, September 26th, 2011

    * US stocks markets edged slightly higher on Friday, but were down sharply for the week.
    * European stock markets ended sharply lower for the week, as the Fed sees significant “significant” global economic risks and the IMF warns of dangers ahead.
    * Asian stock markets fell sharply last week, due to concerns about faltering economic growth. Across the region all sectors were sold down during the week in a rush to a “risk off” scenario.
    * Commodities prices traded sharply lower again, as Gold prices slumped to $US1,640 and while crude-oil closed down  around $US80.

    The SPI Futures is trading below the key pivot level of 4000, ended down -0.2% (or -9 points) at 3,921. The key levels for our index this week are 3850 to 4150.

    On Friday the Australian stocks initially gapped lower, and stayed below the key psychological 4000 level. The miners suffered from severe falls in the commodities prices, as a number of commodities have recently crashed through their key support levels, and investor mood has been driven by sentiment from overseas as many of these markets are in bear market territory.  Stocks managed to stage a recovery after midday, when the G20 group of nations vowed to support global markets. The resource stocks bounced off their lows and the banks saw some bargain hunting after the RBA reported in its twice-yearly Financial Stability Review (FSR) that “The Australian banking system remains in a relatively strong condition compared with some overseas”. The All Ordinaries (XAO) was down -1.6% at 3979 today, the S&P/ASX 200 (XJO) closed down -1.6% at 3903.

    Aussie stocks are expected to open flat, as bargain hunters start to nibble, ahead of the options expiry week and end-of-quarter at the end of the week. The commitment from the G-20 leaders that they will work to address the “heightened downside risks” from sovereign debt and the slowing global economy, is aimed to boosting sentiment.  The US and Europe markets found tentative support Friday night, have traded sharply lower last week, as US and European markets were impacted as world financial leaders warnings of dangers to the stability of the global financial system.

    See below for ASX listed companies in the news today.

    US Markets

    US stocks markets edged slightly higher on Friday, but were down sharply for the week. Investors have dumped stocks last week as the world bank and the IMF warned of dangerous times ahead for world economies. 

    Fears of a possible Greek default and the U.S economy facing a double dip recession, pressured the Dow Jones Index to drop 7 of the past 9-weeks, and last week it plunged -6.4% to its worst weekly performance since October 2008. On the NYSE gainers outnumbered decliners by nearly 2 to 1 on Friday. In the broader market the S&’s 500 stock index rose on Friday, led higher by consumer-discretionary, financial and technology stocks.  The index finished the week down -6.5%, its second largest weekly decline this year. The tech-heavy Nasdaq Composite outperformed up over 1% on Friday, but the index dropped -5.3% for the week. 

    Mining and energy stocks sold down again last week, after sharp losses in commodities prices. Gold plunged around -6% to $US1,640 a troy ounce, to complete a -10% fall for the week and it worst week since 1983. Silver plummeted -17%, its biggest one-day drop since 1980, while Copper prices also fell -6%, plunging -17% for the week.  Crude-oil plunged -9% for the week finishing below $US80 per barrel. The investor mood on Friday was helped by a pledge from global officials to maintain financial stability.

    All ten company groups that make up the S&P index traded generally higher again:  Industrials were up 1.0%,  the Materials were down -0.2%, Energy sector was were down -1.1%, Financials sector was up 1.0%, Consumer Staples were up 1.5%, while the Technology sector was up 1.1%.

    The Dow Jones closed  up 0.4% (or 38 points) at 10,771, the S&P 500 index closed up 0.6% (or 7 points) at 1,136, the Nasdaq ended up 1.1% (or 28 points)  at 2,483.

    European Markets

    European stock markets ended sharply lower for the week, as the Fed sees significant “significant” global economic risks and the IMF warns of dangers ahead.

    The Stoxx Europe 600 index dropped -6.1%, for its biggest falls in seven weeks, as all 19 industry groups declined. The Stoxx Europe 600 index is now trading at about 9 times the estimated earnings of its constituent companies, which is around the lowest valuation since March 2009 (according to Bloomberg).

    Across the region the banks have been hardest hit as there are concerns that they will have to be recapitalised to ensure the eurozone financial stability.  Mining and energy were also sold-off heavily due to sharp falls in commodities prices.

    In London the FTSE 100 index closed up 0.5% (or 25 points)  5,067, the German DAX was up 0.6% (or 32 points) at 5,196,  while in France the CAC was  up 1.0% (or 28 points)  at 2,810. 

    For the week in London the FTSE 100 index dropped almost -5.6%, while the German DAX 30 plunged -6.8% as stocks sold off across the board and the French CAC-40 dropped -7.3%.

    Asian Markets

    Asian stock markets fell sharply last week, due to concerns about faltering economic growth. Across the region all sectors were sold down during the week in a rush to a “risk off” scenario.  Miners and energy stocks sold down heavily across the region after sharp falls in commodities prices over the week.

    In Japan the Nikkei Stock Index fell -10.3% for the week, while in Hong Kong the Hang Seng Index plunged nearly -9.2% and in China the Shanghai Composite Index plummeted -11% for its worst week since August 2001, after a weak reading on manufacturing in China contributed to the grim mood, along with comments from CEO Tom Albanese who said that some of the RIO’s customers are requesting delays in metals shipments.

    In Australia the S&P/ASX200 dropped -5.9% for the week.

    In China the SSE Composite down -0.4% (or -10 points)  at 2,433, while in Hong Kong the Hang Seng Index was  down -1.4% (or -243 points) at 17,669 and in Japan the Nikkei 225 Index was closed at 8,560, South Korean KOSPI was down -5.7% for the session, while the Indian market was  down -1.2%.   

    Commodities
    The Dollar Index was higher at 78.50 on a lower Euro, while the Australian Dollar last traded lower at 97.81. Commodities prices were sharply lower.

    For the session the Benchmark crude NYMEX for September delivery was down -0.8% (or -$US0.66) settle at $US79.96.  Copper prices are still below key support level as Copper for September delivery was down -6% (or -20.9 cents) at $US3.2820.  September gold was down -5.9% (or -$US101.70) at $US1,642.50. 

    ASX News Today

    BKW – Brickworks annual profit has edged up three percent but the company says there is little chance of a recovery of Australia’s housing market in the near term.

    FGL – Foster’s Group says its planned $12.3 billion takeover by British-based brewer SABMiller will be good for local jobs and the company’s branding overseas.

    KMD – Kathmandu Holdings has quadrupled annual profit as sales shot up through the year.

    MMX – Murchison Metals has reduced its full year net loss after stronger iron ore prices boosted sales revenue, and has scaled back activities at its troubled Oakajee port project in Western Australia’s Mid West.

    ORL – OrotonGroup  the luxury accessories retailer annual profit has grown by eight per cent and says its sales so far this fiscal year have exceeded expectations.

    QAN – Qantas passengers could face delays next week after the Transport Workers Union (TWU) flagged further strikes as part of an ongoing row over pay and conditions.

    SOL – Washington H Soul Pattinson & Co Ltd’s full year profit has increased by 67 percent as the investment firm benefited from an asset sale by New Hope Corporation, one of its associated companies.

    RIO – miners including Rio sold off heavily yesterday as CEO Tom Albanese reported some of RIO’s customers are requesting delays in metals shipments.


    Local Corporate Reporting
    Gryphon Minerals (GRY)     Full year 2011 Results 
    Cockatoo Coal Ltd (COK)    Full year 2011 Results 
    Dart Energy Limited (DTE)  Full year 2011 Preliminary results
    Bow Energy Ltd (BOW)       Full year 2011 Preliminary results

    Ex-dividend Date
    APZ – Aspen Group
    AYF – Australian Enhanced
    CAB – Cabcharge Australia
    CWN – Crown Limited
    EPX – Ethane Pipeline
    FAN – Fantastic Holdings
    FBU – Fletcher Building
    IMF – IMF (Australia) Ltd
    LYL – Lycopodium Limited
    MMS – McMillan Shakespeare
    MXI – MaxiTRANS Industries
    MYR – Myer Holdings Ltd
    NCM – Newcrest Mining
    NPX – Nuplex Industries
    PET – Peters MacGregor Inv
    PNW – Pacific Star Network
    SKC – Sky City Entertain.
    SMX – SMS Management.
    SNO – Snowball Group
    SRX – Sirtex Medical
    SVW – Seven Group Holdings
    SWL – Seymour Whyte Ltd
    SYM – Symex Holdings
     
    Market Summary

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

    Commodities Stock Index  down -1.1%
    Gold Stocks Index down -4.3%
    Oil Stocks Index  down -0.5% 

    US ADRs – Broadly Mixed!!…

    BHP up 0.7% & RIO up 0.8%; AWC up 3.6%
    ANZ up 0.8% & NAB down -1.5%
    NEM  down -3.7%, JHX down -0.6%, NWS up 2.4%

    By Michael Hevern
    Head of Research

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

    Written on 26 September, 7:15am

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    Stock Market Analysis: Dangerous Times

    Friday, September 23rd, 2011

    * US stock markets plunged again overnight late in the session as investors dumped stocks as the Fed and the IMF warn of dangerous times.
    * European stock markets ended sharply lower again overnight, with banking, mining and energy stocks hit hard as it was “risk off”.  The Stoxx Europe 600 index dropped 4.6%.
    * Asian shares ended sharply lower yesterday after China data disappointed.
    * Commodities prices traded sharply lower, and Gold prices slumped to $US1,734 and while crude-oil closed down  around $US80.

    The SPI Futures is trading below the key pivot level of 4080, ended down -1.9% (or -76 points) at 3,890. The key levels for our index for today are 3850 to 3950.

    Yesterday the Australian share market closed below the key psychological 4000 level today, for the first time in two months and prior to that it hasn’t been seen at these levels since mid – July 2009. Everything was on sale but nobody wanted to buy, with the exception of Foster’s today after they finally  accepted a revised $12.3 billion bid from SABMiller (at $5.53/share).

    Aussie stocks are expected to be sold off heavily again today following on from more sharp falls in the US and Europe overnight.  Overseas stocks traded sharply lower overnight, as US and  European markets as world financial leaders warn of dangers to the global financial system.

    See below for ASX listed companies in the news today.

    Economics News Today

    *  RBA – Reserve Bank of Australia’s Financial Stability Review.

    US Markets

    US stock markets plunged again overnight late in the session as investors dumped stocks as the Fed and the IMF warn of dangerous times as Europe, Japan and the US were called upon to act to resolve their economic problems, otherwise the world faces a global meltdown.

    It was “risk off”, as US investors dumped stocks and rushed into “safe” assets such as the U.S. dollar, which surged, and 10-year Treasury bonds, whose yields plummeted to 1940s levels. 

    The Dow Jones Index has had its worst 2-day point dump since November 2008, after a bleak outlook by the Federal Reserve renewed fears of an economic slowdown. The S&P 500 stock index and the tech-heavy Nasdaq Composite Index both had their fifth largest drop this year. On the NYSE decliners outnumbered gainers by just over 7 to 1, while the Nasdaq losers outpaced gainers by about 6 to 1.

    All the Dow Jones blue-chip stocks finished in the red, and all 10 S&P 500 sectors were sold down. Materials and energy stocks were hit hardest due to the prospects of an economic slowdown and the dangerous financial conditions highlighted by the IMF and the Fed.

    All ten company groups that make up the S&P index traded sharply lower again:  Industrials were down -3.8%,  the Materials were down -5.6%, Energy sector was were down -5.6%, Financials sector was down -2.9%, Consumer Staples were down -3.0%, while the Technology sector was down -3.1%.

    The Dow Jones closed  down -3.5% (or -391 points) at 10,734, the S&P 500 index closed down -3.2% (or -37 points) at 1,129, the Nasdaq ended down -3.3% (or -83 points)  at 2,456, and the smaller cap Russell 2000 was down -3.3%.

    European Markets

    European stock markets ended sharply lower again overnight, with banking, mining and energy stocks hit hard as it was “risk off”.  The Stoxx Europe 600 index dropped -4.6%. 

    Banks were yet again the biggest declines, after the recent Standard & Poor’s Ratings Agency credit rating downgrades on the several Italian lenders.  French banks suffered some of the biggest losses among banking stocks again. 

    Resource and energy stocks also plummeted due to plunging commodity prices is a indiscriminate liquidation.  European investors got their first chance to react to the disappointment over the Federal Reserve’s bond-swap program “Operation Twist” and as economic data indicated the eurozone’s private sector faltered in September.

    Traders are finally realising that all the austerity measures that are being forced on to nations, particularly the PIIGS economies will mean that economic growth will stagnate for the foreseeable future. 

    In economic news the preliminary eurozone composite purchasing managers’ index (PMI) dropped to 49.2 in September, pointing to the first decline in private-sector activity across the euro area in over two years.

    In London’s FTSE 100 index dropped almost -5% as Heavyweight mining stocks also dropped, with Antofagasta down nearly 13%, Rio Tinto plunging nearly 11% and BHP Billiton PLC down over 8%. The German DAX 30 fell also -5% as stocks sold off across the board. The Italian market plunged -4.5%.

    In London the FTSE 100 index closed down -4.6% (or -245 points)  5,043, the German DAX was  down -5.0% (or -270 points) at 5,043,  while in France the CAC was  down -5.3% (or -154 points)  at 2,782. 

    Asian Markets

    Asian shares ended sharply lower yesterday after China data disappointed, the eurozone debt crisis and the U.S. Federal Reserve painted a gloomy view on the economic outlook for investors. Across the region all sectors were sold down in a rush to a “risk off” scenario.

    A weak reading on manufacturing in China contributed to the grim mood, along with comments from CEO Tom Albanese who said that some of the RIO’s customers are requesting delays in metals shipments. The much anticipated pronouncement from the Fed that said it will increase its share of longer-term Treasury Bills by $400 billion by June 2012 by selling shorter-dated holdings, in “Operation Twist”, but investors shuddered at the Fed’s gloomy economic outlook. 

    In Japan the Nikkei Stock Idex fell -2.1%, while in Hong Kong the Hang Seng Index plunged nearly -5% and in China the Shanghai Composite Index fell -2.8% to 52 week lows.  Asian markets are expected to follow sell-off that happened in the US and Europe overnight.

    In China the SSE Composite down -2.7% (or -70 points)  at 2,443, while in Hong Kong the Hang Seng Index was  down -4.9% (or -912 points) at 17,912 and in Japan the Nikkei 225 Index was down -2.1% (or -180 points) at 8,560, South Korean KOSPI was up 0.9% for the session, while the Indian market was  down -4.1%.   

    Commodities

    The Dollar Index was higher at 78.41 on a lower Euro, while the Australian Dollar last traded lower at 97.56. Commodities prices were sharply lower.

    For the session the Benchmark crude NYMEX for September delivery was down -6.3% (or -$US5.41) settle at $US80.53.  Copper prices are still below key support level as Copper for September delivery was down -7.3% (or -27.3 cents) at $US3.430.  September gold was  down -3.7% (or -$US66.30) at $US1,733.80.      


    ASX News Today


    BKW – Brickworks annual profit has edged up three percent but the company says there is little chance of a recovery of Australia’s housing market in the near term.

    FGL – Foster’s Group says its planned $12.3 billion takeover by British-based brewer SABMiller will be good for local jobs and the company’s branding overseas.

    KMD – Kathmandu Holdings has quadrupled annual profit as sales shot up through the year.

    MMX – Murchison Metals has reduced its full year net loss after stronger iron ore prices boosted sales revenue, and has scaled back activities at its troubled Oakajee port project in Western Australia’s Mid West.

    ORL – OrotonGroup  the luxury accessories retailer annual profit has grown by eight per cent and says its sales so far this fiscal year have exceeded expectations.

    QAN – Qantas passengers could face delays next week after the Transport Workers Union (TWU) flagged further strikes as part of an ongoing row over pay and conditions.

    SOL – Washington H Soul Pattinson & Co Ltd’s full year profit has increased by 67 percent as the investment firm benefited from an asset sale by New Hope Corporation, one of its associated companies.

    RIO – miners including Rio sold off heavily yesterday as CEO Tom Albanese reported some of RIO’s customers are requesting delays in metals shipments.


    Local Corporate Reporting
    Gryphon Minerals (GRY)     Full year 2011 Results 
    Cockatoo Coal Ltd (COK)    Full year 2011 Results 
    Dart Energy Limited (DTE)  Full year 2011 Preliminary results
    Bow Energy Ltd (BOW)       Full year 2011 Preliminary results
    Ex-dividend Date
    COU – Count Financial
    RHG – RHG Limited
    SXL – Sthn Cross Media
    Market Summary

    ASX – to open sharply lower
    US & UK/Europe –  sharply lower

    Commodities Stock Index  down -6.2%
    Gold Stocks Index down -7.4%
    Oil Stocks Index  down -5.2% 

    US ADRs – Broadly Lower!!…

    BHP down -6.5% & RIO down -10.2%; AWC down -5.5%
    ANZ down -4.5% & NAB down -4.9%
    NEM  down -3.6%, JHX down -6.9%, NWS down -2.9%

    By Michael Hevern
    Head of Research

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

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