Skip to content

Tuesday, 14 August 2007

Morning Market Report

Marcus Padley, sharemarket analyst and author of the Marcus Today daily newsletter, reports:

The market is struggling today, down 32 and rising. It was off 70 earlier on. The SFE Futures had predicted a 40 point rise this morning. Looks like we went up too much yesterday (ASX 200 up 75) in anticipation of a central bank inspired bottom on the whole market. Wall Street failed to deliver. As mentioned yesterday. The Central Banks are concerned with the integrity of the banking system… They are not saying they are a safety net for making losses in bond markets, corporate bond markets, equity markets or hedge funds. They are not going to save people from themselves. They are not here to look after the people who have overgeared themselves to the downside in their pursuit of upside. The markets are the markets and they are left to market forces. The central banks are not trying to save them or us.

The Dow Jones closed down 3 overnight despite the Federal Reserve and other banks put more cash into the banking system, the Federal Reserve announced $2bn in overnight repurchase agreements, the Bank of Japan added $5bn and the European Central Bank $65bn. It was a quiet session, both the S&P 500 and the NASDAQ finished slightly lower.

  • The big news this morning is RAMS Home Loans (RHG) — their listing nightmare continues, their shares are getting smashed after a profits warning this morning. RHG down 37c or 21% to 138c. They listed two weeks ago at 250c. A 45% loss so far. The Eureka Report wrote a fairly damning article on the float prior to listing. Well done them.
  • Leighton Holdings (LEI) have just released results. NPAT up 63% to $450m. Company guidance had been for 55% profit growth…the market was looking for $430m. Now 4240c….down 25c today.
  • APN News & Media (APN) down 13c to 556c after announcing a flat and expected 1H07 NPAT of $72.5m compared to $72.1m a year ago.
  • Cochlear (COH) up 149c to 6330c on the back of their solid earnings announcement this morning. The stock has put 20% in the past 12 months.
  • “JB you’ve done it again” – Another better-than-expected profit result from JB Hi-Fi (JBH) this morning. Share price is up 115c or 11% to 1127c.
  • Toll Holdings (TOL) announced this morning they will extend their takeover offer for Singapore’s Sembawang Kimtrans Ltd until August 23. TOL down 2c to 1395c.
  • SingTel (SGT) is up 3% or 8c to 275c on results.
  • Salmat (SLM) is down 13c (2.55%) to 496c on their full-year results.
  • ABN AMRO have downgraded United Group (UGL) from BUY to HOLD after results yesterday in line with expectations. Credit Suisse retains an OUTPERFORM recommendation and a $22 target price.

Pretty quiet session all in all.

We have Step 5 of the Idiots Guide to building an Australian equity portfolio in the Marcus Today newsletter today. This recent pause in the market is pretty good timing for those about to invest their Super for the long term.

THE MORNING MARKET REPORT is provided by the MARCUS TODAY daily stockmarket newsletter. You can subscribe for a free five-day trial here.