The market is down 9 despite the futures being up 20 this morning. Yesterday’s enthusiasm for resources has disappeared as the US dollar goes up and commodities prices go down again. Resources down 1.8%. Financials up 0.6% following the lead from financials in the US. Property up 1.6%.

Dow up 83. Up 185 at best. Down 82 at worst. Main Point: Financials up 2.6%. Resources flat. Gold down. Mortgage providers up strongly. Inflation higher than expected but July number seen as the peak. Greenspan says housing market will bottom in 1H 2009. Fannie and Freddie have had restrictions lifted to assist them in financing US home loans – both up over 7%. JP Morgan and Morgan Stanley pay fines and make auction-rate-securities related settlements, buying back $7bn in securities. Energy stocks down 1.3%. Homebuilders up 4.4%. Consumer discretionary sector up 2%.

  • Both BHP and RIO slightly down in ADR form overnight, 0.30% and 2.68% respectively.
  • Metals mostly down overnight – Nickel down 2.11%, Copper down 0.49% and Aluminium 1.16%. Zinc unchanged.
  • Oil price down 91c to $115.05 after concerns about a possible supply disruption in Eastern Europe eased after a senior US official told the Pentagon that Russian troops appeared to be complying with the cease-fire agreement.
  • Gold down $16.90 to $810.70
  • US Bonds up with the 10 year yield down to 3.89% from 3.94%.
  • Majors resources down – BHP down 78c to 3792c. RIO down 343c to 11452c. FMG down 21c to 750c.
  • Gold stocks down – NCM down 3.0%, LGL down 3.4% and SGX down 5.0%. AVO and SBM down 5.8% and 11.1%.
  • Iron ore stocks down – MGX and MMX down 2.2% and 5.6%.
  • Nickel and copper stocks down on falling metals prices overnight – WSA down 3.3%, MCR down 5.6% and PNA and EQN down 3.4% and 4.7%.
  • Energy stocks down – Woodside down 2.4% or 131c to 5426c. Santos down 2.2% or 39c to 1752c.
  • Banks up slightly – CBA up 0.4%, WBC up 0.7%, ANZ up 0.2% and SGB up 0.1%.
  • Property trusts up – WDC up 2.7%, SGP up 0.4% and GMG up 1.1%.

RATE CUTS IMMINENT– The press is full of yesterday’s comments from the Deputy Governor of the RBA saying “…we try to be pre-emptive when we start tightening and pre-emptive when we start easing”.

For the Uranium fans– Cameco (the world’s biggest uranium producer) had results overnight – missed expectations and didn’t update on the Cigar Lake flooding that has delayed the project – bodes well for the uranium price – the Patersons analyst likes Paladin (PDN) and ERA (pretty obvious picks) but also Energy and Minerals (EMA) and Toro Energy (TOE).

Not much news today… the calm ahead of the storm – the results season next week. BHP results on Monday.

  • Gunns (GNS) down 6.9% on a profit warning – FY08 net profit to fall 24% – maintains positive price outlook for timber in FY09.
  • Woolworths (WOW) – According to the AFR WOW nearly announced a $1.4bn takeover for JB Hi-Fi today before talks broke down due to personality and personnel issues – would have given WOW the growth avenue it’s looking for. WOW down 0.52% and JB Hi-Fi down 6.35%.
  • QBE Insurance’s (QBE) $1.03bn purchase of PMI’s mortgage insurance business has been noted by Were’s as a “risky” deal especially at the top of the interest rate and property market cycle. QBE down 10c to 2340c.
  • News Corporation (NWS) have agreed to take NDS Group private. News Corp up 18c to 1638c.
  • Macmahon Holdings (MAH) has won a $78m highway contract in Perth. MAH down 2c to 154c.
  • Babcock and Brown (BNB) down 6.6% on market concerns about domestic and offshore bank’s exposure to BNB – institutional brokers saying BNB’s share price has been hit by another wave of margin calls.
  • Merrills tipping Ansell (ANN) to post strong FY08 NPAT before one-offs up 13% on FY07 and says that the result should show the “top-line profile and the margin potential of an outperforming company.” ANN unchanged at 1108c.
  • Australian Transport Minister Anthony Albanese likely to announce approval of the plan to expend the safety area at Macquarie Group’s 72%-owned Sydney Airport. MAP down 3c to 282c.
  • Wal King (Leighton Holdings) – The NSW economy is “near frozen at the controls”, the Australian economy faces a turbulent period and consumer confidence is fragile. LEI still in a trading halt at 4236c as it completes its institutional share placement which has apparently seen strong demand.

We have a look at the Week Ahead in the MARCUS TODAY newsletter today along with a list of all the Cheapest stocks in the ASX 200 and the highest yields.

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

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