Poor start to the week — the market is down 89 – much worse than the 5 point fall the SFE Futures had predicted.
WALL ST DOWN 82 – Wall St. moved in a 178 point range and closed down – above its lows of the day, but well off its highs – mainly on concerns that corporate defaults will increase. The market struggled for most of the session despite impressive earnings results. McAfee put on 9.2% after it announced a better-than-expected 4Q profit, Tiffany & Co. – up 4.4% – it predicted 2008 earnings would be better than initial forecasts, but Weyerhaeuser disappointed by announcing a 4Q loss thanks to a depressed housing market. Financials struggled (down 3.3%), Bank of America Corp (down 2.8%) and JP Morgan Chase & Co (down 2.9%) helped the index for banks and brokerages experience its biggest weekly drop in 6 years. According to Bloomberg, financial companies have written down the value of debt related products on their balance sheets by $146bn since the beginning of last year. The NASDAQ bucked the trend and finished higher thanks to Amazon.com – up 3.7% – announcing a $1bn share buyback, but it was a horror week for all the major indexes, the Dow Jones closed down 4.4%, the NASDAQ fell 4.5% and the S&P 500 lost 4.6%. The S&P 500 index has lost 15% since its Oct 9th record, while the Dow Jones has dropped 14% from its all time high.
In the news today…
- AFG in a trading halt. Talk of a takeover. AFG in a halt at 305c.
- Mirabella Nickel to build a US$254m nickel smelter in Brazil. MBN up 7c to 537c.
- Allegiance Mining loses $7.9m punting on stocks. Chairman says if Soc Gen can do it then others can have a flutter as well. AGM unchanged at 105c.
- Woodside buys Royal Dutch Shell’s oil assets in WA for $398.5m. WPL down 45c to 4440c.
- David Jones ups its 1H profit growth expectations and announces impressive 2Q sales numbers. DJS up 20c to 437c.
- Resource Pacific in talks with a third party – hoping to sell themselves for a higher price. Xstrata currently bidding for them. RSP up 30c to 328c.
- Primary Health Care profit result – 1H NPAT down 24% to $20.4m. PRY down 18c to 1042c.
- United Group profit result up 46% to $51.5m but well below expectations. UGL down a big 17% or 249c to 1200c
- Ansell profit result up 28% to $56.9m. ANN up 36c to 1186c.
In the MARCUS TODAY newsletter today we have an updated Results Diary and a preview of the week ahead.