Morning Market Report, Oct 23, 2007

The market is up 57. The SFE Futures suggested a 47 point rise in the market this morning

The Dow Jones was up 44 overnight – It moved in a 180 point range and finished higher for the first time in six sessions on speculation tech stocks would report better-than-expected earnings results. The session started in negative territory but recovered well after Merck, American Express and Apple all announced earnings results that topped Wall Streets expectations. The financial sector recovered, Bear Stearns and China’s Citic Securities Co. agreed to invest $1bn in each other to combine their businesses in Asia and collaborate in developing financial products and services in China. The two also announced a Hong Kong based joint venture to bring together their operations outside of China. Homebuilders gained on expectations that a report on Wednesday will show better-than-expected sales of existing homes in September. The NASDAQ closed up 1%; Apple’s 4Q earnings result easily topped analyst’s expectations after it sold more than a 1m iPhones and received more orders for its Mac computer than ever before. Its shares closed up 2.3% and put on another 6% in after hours trading.

Resources doing OK today. A few of the big boys have announced their quarterly production results. The market seems a little disappointed with BHP 1Q production figures – they have been described as weak and a “bit soft” but didn’t consist of any nasty surprises on costs or timing of projects. BHP down 37c to 4556c. RIO up 37c to 10587c. Metals all down overnight, Zinc down 2.6%, Nickel down 1.6%, Copper down 1.4% and Aluminium 1.2%. Zinifex up 33c to 1850c. Oil price down 98c to $87.60 on speculation credit market losses could slow the global economy. Woodside down 31c to 5199c. Gold down $8.40. Newcrest (NCM) up 28c to 2892c. The market seems happy with their production numbers. They announced an impressive 18% rise in gold output in the 3Q. Gold production from all mines increased to 448,103 ounces, up from 379,701 ounces last year.

Lots of company related stuff going on today – production figures, sales numbers and AGM’s.

Woolworths’ (WOW) sales numbers have come in slightly below analyst’s expectations but good nonetheless. 1Q sales up 8.9% to $11.7bn. All important like-for-like sales in their Australian food and liquor division increased by 7.6%. WOW up 44c to 3239c.
Oxiana’s (OXR) production numbers came in as expected. They announced gold and copper output at Sepon was steady during the 3Q and that they will meet annual forecasts of output and costs. Costs may be a touch higher however for the rest of the year due to a planned 5 day maintenance shutdown. OXR up 15c to 382c.
Ten Network (TEN) up 2c this morning to 294c on reports that Win Corp. owner Bruce Gordon has bought options to buy a further 4.3% of the network to take his stake above the crucial 10%. A holding of 10% or above gives Gordon a blocking stake and potential headaches for majority shareholder CanWest should they find a buyer.
Macquarie Airports (MAP) up 4c to 445c after announcing this morning they had upped their stake in Brussels Airport to 58.9% after buying an additional 5% interest for around $122m. Brussels has been showing some impressive growth with EBITDA of EUR195m this year, up from EUR136m last year.
Symbion Health (SYB) says it will go ahead with plans to sell its diagnostic assets to Healthscope (HSP) despite majority shareholders Primary Health Care (PRY) saying it will vote against the move. This takeover has dragging on for a while and it doesn’t look like being settled any time soon. HSP down 3c to 531c, SYB down 3c to 402c and PRY up 18c to 1195c.
Qantas (QAN) said will be spending $400m buying 12 additional Bombardier Inc. Q400 aircrafts and will have options and purchase rights for 24 more. The 72-seat planes will be delivered from June 2008. QAN up 5c to 572c.
Wotif (WTF) said in their annual meeting statement that business is going good. Bookings for the year are up 21% and according the MD Graeme Wood, the “growth is pleasing given the very strong performance in the same period last year”, which was up 54%. WTF up 3c today to 583c. Analysts are labelling their $57m bid for loss making Travel.com as a good long term decision.
Publishing and Broadcasting (PBL) up 25c to 2037c. According to Were’s, 3Q 2007 gaming statistics for Macau show a 50% increase in revenue from a year ago. They maintained their Buy recommendation and 2235c target price.
Pacific Brand also doing well, up 5.4% to 331c after it reiterated its profit guidance for FY08.