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Morning Market Report

A skittish day on the markets amid disappointing results releases.

The market is up 15 points.The Dow Jones was down 31 points at 15,964 — the market rallied at the open, but reached the high for the day in the first 30 minutes. The market then fell and fluctuated around yesterday’s close for the rest of the day in a 110 point range.

Markets rose after strong Chinese economic data but weakened after a reduced earnings outlook from companies such as Procter & Gamble. There was little economic news.

The S&P fell one point to 1819.

Oil was up 0.36%at US$100.30.

Gold rose US$1.30 to US$1291.10 per ounce.

The US$ was stronger against most major currencies. The Australian dollar was weaker and is currently trading at US90.29c.

VIX Volatility index fell 5.43% to 14.64.

US treasury markets were weaker  —  the yield on the 10 year bond rose four basis point to 2.759%.

European shares were stronger  — the FTSE rose 0.04%, the French CAC rose 0.52% and the German DAX rose 0.65%.

European bonds were weaker  —  the yield on the Euro 10 year bond rose three basis point to 1.714% and the UK 10 year bond yield was eight basis points higher at 2.819%.

Base metal prices were stronger  —  aluminium rose 1.74%, nickel rose 1.67% and copper was 1.27% higher.

Iron ore rose US$1.00 to US$121.00 a tonne.

STORIES

  • Qantas Airways (QAN) — Is expected to value its loyalty business at around $3.1-3.3 billion which comes in well above the top end of analyst valuations, if it wanted to float it.
  • Cochlear (COH) — Deutsche Bank has a put a Sell recommendation with a target price of 5425c. The rating comes after COH posted a 73% fall in first half profit on the back of a patent dispute. Reported NPAT was well below their expectations. But they say the company is on track to meeting full year guidance.
  • FlexiGroup (FXL) — Deutsche Bank has a Buy recommendation with a target price of 490c. It says the company reported ‘solid underlying performance and continues a strong record of growth.’
  • Telstra (TLS) — Is due to report its results today. It is tipped to cut another 1000 jobs and could outsource positions to the Philippines and India following a review by two management consulting firms.
  • Forge Group (FGE) — Is in voluntary administration and has announced the retrenchment of 1,300 staff. FGE last traded at 91.5c.
  • NAB  — Rumours are that NAB is considering a $3.7 billion float of its troubled British operation taking advantage of a recent improvement in the British economy. British media said the Clydesdale and Yorkshire banks were under serious examination and could take place at the end of this year.

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