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Morning Market Report

The US leading index was +0.6% for September which was the strongest gain since February.

The market is down 10. SFE Futures were down 7 this morning.

Dow Jones down 8. The Dow was down 46 at worst and up 32 at best. US markets opened lower with the weekly Initial Jobless claims coming in 28,000 higher than expected (poor result). The US leading index was +0.6% for September which was the strongest gain since February. The Philadelphia Fed index was up from -1.9 to +5.7 in October, capital spending, orders and employment components were softer. Google down 8.01% on results.

European markets mixed — UK FTSE up 0.10%, German DAX up 0.58%, France up 0.22%, Spain down 0.34%, Italy down 0.30% and Greece was down 0.27%. The Stoxx Europe 600 index up 0.2% with Industrials (+0.7%), Technology (+0.7%), Telecoms (+0.5%) and Basic Materials (+0.5%) and Consumer Goods (-0.8%). Spanish 10 year bond yield was down another 12.3bpts to 5.34%. Metals mixed  — Copper was flat, Nickel up 0.82%, Aluminium up 1.62% and Zinc was up 0.04%. The spot iron ore price up 10c to $115.50.

  • NAB — falls 3% after they increase provisions. NAB have put out an announcement saying they expect their financial year cash earnings to be in line with last year’s result, after posting quarterly cash earnings broadly in line with last quarter. NAB have also increased provisions and set aside $250m on the back of a weaker outlook for economic growth in Australia as well as a slower than expected recovery in UK. The move will negatively impact their FY year earnings. The guidance is 3% below consensus. They also announce a final dividend of 90c up 4.7% from last year’s dividend. NAB is down 3.01% to 2614c.
  • The ACCC has outlined concerns with the proposed acquisition of the Trading Post by Carsales.com (CRZ) from Telstra (TLS). “The ACCC’s preliminary view is that the proposed acquisition would remove Trading Post as one of Carsales’ closest and most effective competitors in the online automotive classifieds market,” As a result, the ACCC’s final decision will be deferred until 29 November 2012. CRZ is down 0.38% to 780c and TLS is up 1.0% to 404c.
  • Graincorp (GNC) - US grain trader Archer Daniels Midland (ADM) has acquired a 10% stake in GNC and wishes to engage in discussions with the company regarding a potential transaction. Two block trades in the company this morning worth $536 million at a premium of 33% has sparked speculation of a pending takeover bid. GNC is a trading halt at 885c with a match price of 1060c.
  • Sydney Airport (SYD) — Traffic report for September — says traffic growth for the month was solid. SYD is up 1.25% to 324c.
  • GWA Group (GWA) have had a profit warning this morning laying out a fairly grim description of conditions in the new home building market. GWA is down 5.25% to 171.5c.
  • Charter Hall Retail (CQR) — Has raised $100 million to fund its acquisition of several NSW regional shopping centres. CQR is up 0.86% to 353c.
  • UBS have launched their first ETF on the ASX. The fund will hold 40 stocks that have been given a ‘BUY’ rating by the company. The ETF is called the UBS IQ Research Preferred Aust Share Fund

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