The market is up 109 and flying – almost double the 57 point rise the SFE Futures predicted.

WALL ST UP 178 – Wall St. moved in a 206 point range and finished higher for the third straight session (first three day rally this year) after an unexpected rise in retail sales. The Commerce Department said retail sales increased by 0.3% in January, up from the 0.3% drop economists had predicted and up from a 0.4% fall in December as retailers experienced the slowest Christmas in over 5 years. Consumer spending represents more than 65% of US GDP. Retailers up – both Target and Gap Inc led the sector higher. Some earnings results disappointed. Coca-Cola closed down despite announcing a 79% increase in 4Q profit on the back of higher world-wide volume growth, Deere & Co. also finished lower after reporting a 55% increase in 1Q income with a disappointing 2Q earnings forecast. Investment Corp. fell 13% after announcing a 4Q loss of $1.47bn. The NASDAQ had a big session – up 2.3% – both The Wall Street Journal and TechCrunch reported that Yahoo Inc. was in talks with News Corp. about a possible partnership; apparently News Corp. is interested in integrating its MySpace.com and other internet assets into Yahoo. Microsoft put on 2.19% and Google finished 3.19% higher, still 27% of its record high.

Resources outperforming today…BHP up 126c to 3861c and RIO up 406c to 13263c – RIO released profit results yesterday at 5pm – Results were a bit better than expected but largely thanks to a tax benefit on the Alcan acquisition (tax rate 25.7%) rather than trading. The price was up a touch in the US and down a touch in the UK. Very optimistic on the commodity cycle. Telling BHP to pay up. Chairman said “These strong 2007 annual results illustrate that RIO is ideally placed to continue to create substantial future value for shareholders, which remains its first priority”. They said cost pressures will continue..

  • Leighton Holdings (LEI) announces 1H profit of $250.2m, up 31.7% from last year. Analysts expected on average $252.6m. LEI down 545c or 10.5% to 4640c.
  • Aristocrat Leisure (ALL) replaced its existing debt facilities with a new debt and credit facility. ALL up 30c to 920c.
  • Australian unemployment falls to 4.1% in January.
  • AMP Ltd (AMP) announced a $989.5m FY profit, up 15% from last year $915m. Declared a final dividend of 24c. AMP down 23c to 755c.
  • PMP’s 1H NPAT more than doubled helped by a tax benefit. NPAT of $71.1m. PMP unchanged at 170c.
  • ASX Ltd (ASX) came in slightly better-than-expected – up 34.5% to $187.5m, analysts had expected $183.7m. ASX down 43c to 4504c.
  • Goodman Group (GMG) 1H result – NPAT down 5.8% to $284.9m, operating profit up 11% to $290.3m. Reaffirmed FY forecast. GMG down 6c to 421c.
  • Lion Nathan (LNN) cuts FY profit estimate by 2% due to costs relating to its Boag acquisition. LNN up 32c to 955c.
  • News Corp. (NWS) in talks to develop relationship with Yahoo Inc. NWS up 8c to 2240c.
  • City Pacific (CIY) has began due dilligence on certain MFS assets. CIY down 1c to 307c, MFS still in a trading halt.
  • Credit Suisse say Pan Australia (PNA) is worth a look at – maintain 113c target price and OUTPERFORM recommendation. PNA up 3c to 100c.
  • Straits Resources (SRL) total coal resource has increased 276% to 387m tons at its Sebuko mine. SRL up 75c to 745c.
  • Arrow Energy (AOE) upped its 1H pre tax profit forecasts to between $12.3m and $14.5m. AOE up 15c to 229c.

In the MARCUS TODAY newsletter today we have a comprehensive look at all the post results research each day as well as the results out today and a lot more on top.

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Peter Fray

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