The market is down 9. The SFE Futures were up 16 this morning.

The Dow Jones closed up 34 — up 44 at best and down 76 at worst. US markets rallied 50 points into the close to end up. Durable goods orders were up 0.2% in April following a 3.7% drop in March. European markets were all up. Eurozone PMI numbers saw Germany and France soften more than expected in May. UK FTSE the best performer up 1.59%. US Bonds fell as equities rose following the auction of $29 billion of 7yr notes. Oil was up 31c to $90.80. Talks between Iran and the West on Tehran’s nuclear program ended without agreement. Gold was up $4 to $1557. Metals were all up. The Aussie dollar up buying $97.64.

Main points:

  • Sims Metal Management (SGM) gave a FY profit warning and says profits will be less than 85% of the prior year due to the global economic challenges. The consensus was for $140m or 73% of 2011 profit. The market will also be worried about the level of uncertainty SGM has expressed. Results are due Aug 23.
  • Acrux’s (ACR) partner Eli Lilly has received approval to market their Axiron product in Australia. The Axiron is a testosterone therapy product for men. The company has been making significant steps in the marketing and distribution of their product worldwide. They recently gained approval in Canada and are looking to expand further into Asia and the South American market.
  • Aurora Oil & Gas (AUT) will go ahead with their $107m takeover of Eureka Energy (EKA) despite concerns about the terms of their US$15m debt facility with Macquarie Bank. EKA responded by saying facility delivered certainty of funding. At the time of the offer, Macquarie was completing due diligence for the facility, which meant EKA had little choice by to continue with the facility. Other potential sources of funding would have enabled AUT to withdraw their offer.
  • Emeco Holdings (EHL) has forecast FY profit growth of up to 41% due to strong demand in Australia, Canada and Indonesia. The company now expects profit to be between $67m-$70m up from $46.9m previously. The company said demand had been strong in the Australian business while the Canadian business was performing the best. EHL reported a profit of $28.9m in the 6 months to Dec 31.
  • Hastie Group (HST) announced a $20m hit to their FY profit after uncovering deliberate errors in their financial accounts. An employee is believed to behind these deliberate errors and has been suspended as a result. The matter has been forwarded to ASIC. HST shares were suspended from trading on April 17 pending a proposal to recapitalise. HST shares are in suspension.

Qantas Airways (QAN) announced plans to add 900,000 additional seats to their Melbourne, Sydney and Gold Coast routes to defend their stronghold in the local airline industry. Qantas has targeted a 65% share of the domestic market across both Qantas and Jetstar, which the airline believed was a profit maximising position for the company

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