The market is down 17. The SFE Futures suggested an 8 point fall in the market this morning.
WALL ST DOWN 10 – Wall St. moved in a relatively large 201 point range and finished the session lower -despite being up over 100 points at one point – on the back of inflation concerns after the oil price hit record levels over $100. Financials struggled overnight after The Wall Street Journal reported that Lehman Brothers (down 1.35%) could experience big losses through investments in commercial real estate loans. The newspaper also said Ambac Financial Group was in talks to raise at least $2bn in capital to maintain its credit rating, the stock fell after Goldman Sachs Group cut its target price by 30%. Barclays Group revealed $3.13bn worth of credit-related losses and Credit Suisse announced it had suspended traders in connection with the overvaluation of asset-backed securities. The National Association of Home Builders said confidence among homebuilders increased for the second straight month with the sentiment figure hitting 20, up from 19 last month. The index in December reached 18, the lowest since it was first published in January 1985. The NASDAQ closed down 0.7%. Google down 4%. Yahoo! down 2.6% after Microsoft said it won’t raise its bid. Uranium stocks up in the US – Cameco up 2.1%, Mega Uranium up 8.5%.
Financials and resources weighing on the market this morning. Gold and oil sectors the highlight on a strong rally in Gold and oil overnight. Great results from CSL (price up 9%), Oxiana (up 4.2%), Perpetual (up 5%) and Woodside (up 3%). Not such good reactions from Macquarie Office (MOF down 5%) and Toll (down 3.6%).
Plenty of earnings results today…
- Woodside Petroleum (WPL) – BETTER THAN EXPECTED – announced a FY NPAT of $1.03bn, down 28% from last year on the back of currency and costs. Analysts expected $1.02bn. Revenue up 11% to $3.84bn. Declared a final dividend of 5.5c. The oil price jumped from $71 to $96 in the six months they have just reported on.
- Consolidated Media Holdings (CMJ) – IRRELEVANT – announced a pro forma net profit of $57m for the 1H. The company received a $3.3bn bid last month by Lachlan Murdoch and Executive Chairman James Packer. It declared a 10.5c dividend.
- Crown (CWN) – SOLID – Normalized 1H profit down 40% to $211.4m from $353.6m. Were’s expected $171.5m and Credit Suisse $184.8m. revenue down 47% to $992.7m from $1.88bn. Declared an interim dividend of 25c.
- Oxiana (OXR) – IN LINE – announced an expected FY profit of $305.8m (including loss on discontinued operations), down 45%. Analysts on average expected $309m. Outlook for commodity prices remain positive but costs will remain under pressure.
- Amcor result – IN LINE – came in at $185m (before significant) for the 1H, unchanged from last year. Analysts had expected $183m on average. Outlook: Uncertain. Expects global economic weakness to impact on several divisions. Revenue down 13.4% to $4.739bn.
- CSL 1H08 profit result – GOOD – came in at $348.7m up 36% from $257.3m last year, much better than the $329m analysts had expected on average. Cuts its FY forecasts slightly (1%) due to currency issues to between $670m and $690m, up 29% from last year.
- Pacific Brands (PBG) 1H result – BELOW EXPECTATIONS – up 6% to $57.2m from $53.8m. Merrill Lynch expected a $64.7m, JP Morgan $59.9m and Were’s $60.6m. Revenue up 27% to $1.1bn. Declared lower than expected interim dividend of 8.5c. (Were’s 9c)
- Transurban Group (TCL) – EBITDA BETTER THAN EXPECTED – up 53% to $349.4m, from a $228.8m last year. The result beat JP Morgan forecast of $259.1m. Transurban refinanced a further $405m in debt.
- Macquarie Airports (MAP) net profit up 84% to $1.11bn. (Largely comprises unrealized non-cash asset revaluations) Revenue doubled from ordinary activities to $1.53bn. Pay a final distribution of 18c, 13c regular and 5c special.
- Perpetual (PPT) – VERY GOOD – Announced a 15% increase in 1H operating profit of $79.3m. Analysts had expected $77.3m on average. Looks like they got all the bad news out of the way with their recent announcement which saw a drop in FUM.
- Kagara (KZL) – IN LINE – KZL announced a $35.9m 1H profit, down 8%. No change to FY09 production guidance. Revenue up 22%.
- Wages numbers are stronger than expected up 4.2% YonY. All the more reason for the RBA to raise rates.
- The ANZ CEO just bought $1m worth of ANZ at 2275c. Now 2265c. It hit a low of 2241c this week.
- Telstra results tomorrow. Expect revenue growth ahead of guidance of 2-3% (could be 5%) and earnings growth of less than 1% but an increase in the dividend from 14c to 15c is possible giving Mums and Dads some confidence in the yield on the stock.
- Press suggestions (AFR Market Talk) that Macquarie valued Allco Finance Group (AFG) at zero and that they proposed not a takeover but the acquisition of specific assets for cash. AFG still in a trading halt.
- Western Areas (WSA) up 3.1% in reaction to the research after yesterday’s results.
- David Jones (DJS) has chosen American Express as its partner for its new credit card venture.
- Midwest Steel (MIS) rejects Sinosteel’s 560c a share takeover proposal saying it undervalued the company and its prospects.
In the MARCUS TODAY newsletter today we have an article called Alpha Male. If you can’t pronounce Montepulciano then this is for you.