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Morning Market Report

Australia’s unemployment rate isn’t as bad as it could be in the wake of 10,000 job losses.

The market is up two pointsDow Jones was up 136. Up 404 in three days as Syrian concerns dissipate. It was up 136 at best closing once again on its high.

S&P 500 was up 5 to 1689. Seventh gain on the trot.

Apple fell 5.4% in a dull reaction to their new phone launch and the lack of an announcement at their Chinese launch of a deal with China Mobile.

Verizon announced a $49 billion bond issue.

Citigroup laying off 2200 jobs.

MBA Mortgage Index came in at -13.5% versus +1.3%.

Safe haven asset classes holding overnight  —  Gold down 20c and Oil up 17c. Gold sector up 0.8%.

US Bonds up  — The US 10 year bond yield fell six basis points to 2.912%. Good demand for a 10 year bond auction and a Verizon $49 billion bond issue set a positive tone.

Next week’s FOMC Meeting now in focus  — the suggestion is that they will do little more than suggest a token reduction in quantitative easing. Tapering fears subsiding.

The A$ has held over 93c at 93.27c.

BHP was up 0.70% in the US overnight. The stock closed in the US down 3c on the close here yesterday. RIO was up 0.24% in the US.

Iron ore price down 10c to $135.10.

European markets up but not by much.

Metals mostly up but no big moves.

STORIES

  • Employment data  — The economy lost 10,800 jobs. Expectations were for the economy to have added 10,000 new jobs. Unemployment rate to 5.8% as expected. Participation rate fell 65% versus consensus of 65.2%. Less people looking for work.
  • Myer results are out  — stock down 2.6%  — They are below expectations with NPAT at $127 million down 8.7% against forecasts of $130 million. They also fail to give clear earnings guidance again. Total sales up 0.8% to $3.145 billion versus broker analysis of $3.152 billion. Sales slowed into May and June. Cash flow up 11.4%. Profits hurt by refurbishment of three of its biggest 20 stores and the costs of developing their online presence. Operating margin expected to improve in 2014. Cautious outlook statement as expected  although the recent improvement in consumer sentiment suggests this could be the low point in consumer spending. MYR are buying the 35% of Sass & Bide they don’t own. Final dividend 8c. They continue to talk about a year of transition as they execute their five point plan.
  • Sigma Pharmaceuticals (SIP) — Results out. Stock up a cent. First half net profit of $16.3 million down 37.7%. Sales revenue up 3.1% to $1.46 billion. Dividend 2c. EBIT of $24.9 million. Reinvestment program to benefit in the second half. Growth outlook flat and in danger of moving into negative territory. Profit guidance continues to be for a higher profit than last year.
  • Bega Cheese (BGA) — Has launched a takeover of Warrnambool Cheese & Butter Factory Co(WCB). The offer is to acquire all of WCB’s shares. The offer — 1.2 BGA shares + $2.00 in cash. Total = $5.78 at BGA’s current share price. This represents a premium of 28% if you hold WCB shares.
  • In the US the MBA Mortgage Index came in at -13.5% versus +1.3% and Citigroup laid off 2,200 people in its mortgage business on lower mortgage applications.

Womens Agenda

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Smart Company

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StartupSmart

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Property Observer

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