The market is down 18. The SFE Futures were down 16 this morning.

The Dow Jones closed down 91 overnight and was down 104 at worst. The second big fall on Wall St comes after Republicans and Democrats again failed to reach an agreement to raise the debt ceiling prompting talk that the US’s AAA credit rating will be lost even if they strike a deal at the eleventh hour. A$ over $1.10. Economic data overnight failed to inspire with home prices in 20 cities falling 4.5% in May on last year. The oil price put on 39c to $99.59 and the Gold price increased $4.60 to $1616.80.

In the news today…

  • The CPI Number is out — the index rose by 0.9% in the June Q, for an annual inflation rate of 3.6%. Consensus was for a rise of 0.8% for the Q, for an annual pace of 3.5%. The Aussie dollar shot passed the $1.10 market straight after the result. The ASX 200 lost a quick 17 points.
  • Australand Property Group (ALZ) announced a 17% rise in net profit for the first half to $84.78m and say they remain “cautious” but “well placed” to deliver on their guidance. ALZ down 1.1% to 263c.
  • Gloucester Coal (GCL) unchanged at 942c after quarterly production numbers.
  • Aquila Resources (AQA) up 5.4% to 741c after saying normal shipments to resume after sorting out their dispute with Vale.
  • Atlas Iron (AGO) has become a strategic investor in Centaurus Metals (CTM) after buying a strategic 19.9% stake in CTM for $18.7m. AGO down 3.1% to 407c. CTM up 31% to 10.5c.
  • Biota (BTA) has received $6.6m in royalties for their Relenza flu drug from global pharmaceuticals firm GlaxoSmithKline in the 2011 financial year. BTA up 2c to 101.5c.
  • Mirabela Nickel (MBN) down 7% to 197c after announcing cash costs increased by a higher than expected 13% during the quarter. Output increased by 20% during the quarter.
  • Galaxy Resources (GXY) has signed a technology license agreement with US-based lithium ion battery producer K2 Energy Solutions. GXY up 7% to 76c.
  • Moody’s warned that Macquarie Group (MQG) could be included as one of 28 systemically important global banks that will have to hold additional capital of 1-1.5% when the so-called “G-SIB” rules (too big to fail) take effect. MQG up 3c to 2953c.
  • According to The Australian business section, George Soros is calling it quits and returning money to investors from his $US25bn hedge fund after 40 years in the game.
  • Aristocrat Leisure (ALL) up 5% on two big trades after hours last night accounting for 2.5% of the stock, a possible over-reaction to what may have been a run of the mill institutional trade/crossing.

US RATING DOWNGRADE IS EXPECTED EVEN IF THEY DO A DEAL ON THE DEBT CEILING — The suggestion now is that the credit rating agencies are going to downgrade the US’s AAA rating whether they lift the US debt ceiling or not … the justification being that the US political system should not have allowed the debt ceiling issue to come down to the wire and that that alone is enough to worry creditors. If the AAA rating is lost you can expect the US$ to fall, US equities to fall and the A$ to hit a new high. Interest rates in the US on mortgages and credit cards would rise hampering the US economic recovery and potentially causing an economic crisis (according to Obama).

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