The market is up 84. The SFE Futures were up 5 this morning.

The Dow Jones closed down 26 on Friday. Dow down 26 at worst and up 104 at best. The S&P 500 recorded its 7th straight fall during which it has fallen 7.8%.  The index was down 4.7% for the week – its worst week in 2 months and its worst thanksgiving week since 1932. U.S. retail sales during Thanksgiving weekend were up 16% to a record $52.4bn. Metals were mixed on the LME, the oil price was up 60c to $96.77 and the Gold price fell $10.20 to $1685.70.

Main points:

  • IMF could bail out Italy – The market is up on an Italian newspaper article saying the IMF could bail out Italy with a 600bn euro loan facility at interest rates of 4-5% that will give Italy a 12-18 month window to implement necessary budgetary measures “by removing the necessity of having to refinance the debt”. They have 400bn of debt to refinance next year. The ECB may be part of the loan structure with the IMF as guarantor. The beauty of taking funds from the IMF is that the IMF could impose strict terms on Italy in exchange for the loans. The immediate response from one economist is to say the IMF line of credit is ‘inevitable but not enough’. Italy has 1.9 trillion euro of debt. Italy is expected to develop a package of budget measures to be approved at a cabinet meeting on December 5th ahead of an EU summit on December 9th but would still need parliamentary approval.
  • Rio Tinto (RIO) have held an Investor Seminar today. Comments from RIO CEO Tom Albanese are similar to recent BHP comments saying market sentiment has worsened in recent months due to Europe’s debt woes and economic weakness in the US. RIO up 2.6% to 6361c.
  • Qantas Airways (QAN) say they expect to post an underlying net profit of $140m to $190m in the first half of 2011/12. They say fuel costs and the industrial disputes with unions have cost them more than $650m. There is also some mild bid talk. QAN up 5% to 153c.
  • Dexus Property Group (DXS) CEO Hoog Antick will retire at the end of March and be replaced by Colonial First State Global Asset Management managing director Darren Steinberg. DXS up 3c to 84.5c.
  • Sundance Resources (SDL) down 5.9% on the open after Friday’s announcement that a letter guaranteeing funding from the China Development Bank for Hanlong Mining’s $1.65 billion takeover wouldn’t be forthcoming. Chairman George Jones tried to reassure investors saying that the letter was a mere technicality.
  • Woodside Petroleum (WPL) announced a veiled profit warning on Friday. Analysts this morning aren’t impressed with most cutting their target prices. Their revised production guidance was disappointing and caused the share price to fall 5.8%. WPL down another 2% to 3265c

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