Crikey

The market is surprisingly doing OK  — down only 7 compared to the 57 point fall the SFE futures predicted this morning following the heavy falls on Wall Street overnight. It seems we soaked up most of the damage yesterday. Aussie banks doing well despite their US counterparts getting smashed overnight, Resources also doing OK.

Dow Jones down 254. Down as much as 339 points at one point. It was the biggest fall in 3 weeks. The US Government rejected recovery plans from GM and Chrysler and Financials struggled on concerns that banks will need another capital injection. Oil fell the most in four weeks on concerns the recession in major energy consuming countries may get worse and Geitner said the Treasury has around $135bn left in financial-stability fund  — didn’t say whether he will be needing additional funds. Gold down. Oil down 7.5%.

Oz Minerals (OZL) announces it has received an incomplete alternative bid from Minmetals that would result in them acquiring most of its assets apart from Prominent Hill. It also said it will make an announcement on refinancing negotiations before the start of trading tomorrow and will try to make a definitive announcement the new Minmetals deal.

Making the news today…

• Santos (STO) says its proposed gas export terminal at Gladstone in QLD is set to become the first major plant in the world to produce liquefied natural gas from coal seam gas. STO is competing with other venture to build CSG-to-LNG processing facilities at Gladstone.
• Nufarm (NUF) has announced an interim profit of $65.7m, up from $4.5m last year and well above expectations. European and North American acquisitions pumped sales up 25%. Revenue up to $1.24bn. Declared an interim dividend on 12c. Remains on track for a FY operating profit of around $220m.
• APN News & Media (APN) has seen improvement in demand in March but warns the outlook for the current year remains tough. 2009 began slowly but say overall numbers have improved.
• DUET Group (DUE) commences an institutional component of a capital raising at a 24% discount to its last trade 172c.
• Lion Nathan (LNN) upgraded by Fitch Ratings to BBB+ from BBB.
• Macquarie Group (MQG) has made changes to its remuneration structure that cuts high-level employees’ cash compensation and replaces it with shares.
• Otto Energy (OEL) in a trading halt.
• According to Merrill Lynch, BHP Billiton is likely to lead the way regarding 2008-09 iron ore contract talks after rival Vale said it would take a back seat this year. 2007-08 iron ore contract year ends today, but still no formal iron ore contract price deal for next year.

Broker stuff today…

• Royal Bank of Scotland are underweight Aussie Banks — says declining outlook and resultant downside earnings risk are likely to dominate bank’s share price going forward. They say, “WBC remains our top pick in the major banks, followed by CBA. NAB is the least-preferred banking stock”.
• GSJB Were expects the Ten Network (TEN) to announce a NPAT of $52.8m and 2c dividend. They maintain their Sell recommendation and 60c target price.
• Incitec Pivot (IPL) has had its target price cut to 204c from 228c by Citi and to 340c from 370c by Credit Suisse. Credit Suisse maintain their Outperform recommendation but believe it would be “more prudent” for IPL to reduce payout ratio of 55% to 65% to dilute shareholders via the dividend reinvestment plan.

The Dow Futures suggest a 25 point gain on Wall Street tonight.

MARCUS PADLEY is the Author of the MARCUS TODAY Daily Stockmarket Newsletter.

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