The market is down 39. Main theme from overnight is resources down and financials up. BHP has taken 21 points off the index on its own. The National Bank is ex dividend 97c and has taken another 7 points off. RIO 6 points.

Resources down 2.6%. Financials down 0.2%. Industrials up 0.2%.

Dow up 52. Up 132 at best. Down 40 at worst. SFE Futures down 20. S&P500 had biggest gain in a month – up 0.5%. 8 out of 10 industry groups up. Q1 GDP revised up from 0.6% to 0.9% but a bit less than the 1.0% expected. Energy sector down. Oil price fell 3.4%. Resources down. Uranium stocks down. US trade deficit shrinks to a 5-year low. Gold stocks down on a $23 fall in the gold price. Financials up 1.6%, recovering from a 6% fall in the last week. JP Morgan analyst predicts financials will rise 21% as the costs associated with protecting their bonds from defaults declines. Mortgage insurers up – MBIA up 4.54%. Ambac up 9.18%. Mortgage providers up – Fannie Mae up 1.27%. Freddie Mac up 2.27%. Retailers mostly up posting mixed results. Housebuilders mostly down. Tech stocks up – Nasdaq up 21. Apple down 0.17%. Google up 2.60%. Bear Stearns’ JP Morgan buyout approved by shareholders. Bear Stearns shareholders have OK’ed the JPMorgan Chase buyout, with the Fed acting as the $19bn underwriting broker.

  • Both BHP and RIO down in ADR form overnight, 3.22% and 3.02% respectively. BHP down 138c to 4464c. RIO down 495c to 13942c.
  • Metals all down overnight – Zinc down a big 6.8%, Copper down 2.6% and Aluminium 2.8%. Nickel down 1.4%. Zinifex down 30c to 956c.
  • Oil price down $4.30 to $126.70 after the Energy Department reported unexpected falls in crude oil supplies last week but also said that the drop was due to temporary delays in unloading oil tankers along the Gulf Coast. Woodside down 84c to 6476c.
  • Gold down $23.30 to $877.20. Newcrest down 179c to 3042c.
  • US Bonds down with the 10 year yield up to 4.07%

Origin Energy (ORG) no. 2 power retailer, rejected the revised $13bn bid from British Gas and in the same breath upped their own coal seam gas-reserves estimate by double. Origin said that it had received an increased offer of $15.50 per share in cash for the BG Group, valuing the company at $13.6bn which was a 40% premium to the share price at the time. ORG says Santos’s $2.5bn deal to sell a stake in its LNG gas project to Petronas influenced its decision to reject BG’s sweetened bid. “[It] establishes a new and higher benchmark for the value of CSG and, along with the proposed BG LNG project, demonstrates confidence in the use of CSG for LNG production.” We are now expecting a higher offer for Origin possibly from some of the under bidders who missed out on the Santos LNG assets. ORG was up 10% first thing. After the huge rally in Energy stocks yesterday there is some pause for breath this morning elsewhere in the sector. Santos down, Woodside down, Oil Search down.

  • Today is the last day to buy St George Bank before it goes ex dividend 88c on Monday morning. SGB up 40c to 3310c.
  • Macarthur Coal (MCC) have announced a resource increase – up 32c to 1965c.
  • Gold stocks down on the gold price fall. Newcrest down a whopping 5.6%.
  • Allco Finance Group gets a one month extension to its $250m bridge facility. AFG down 2c to 49c.
  • Looks like the ANZ has missed out on the Wing Lung bank in Hong Kong as the China Merchants Bank is suspended in Friday trade. It is possibly a bit of relief for ANZ shareholders. ANZ up 19c to 2154c.
  • The Westpac CEO speaks out about the need to abolish the four pillars policy saying the Westpac bid for St George “brings into question the future of the Australian banking system…I actually now believe that Australian banks are vulnerable”. He used to work for HSBC, one of the most likely foreign predators. WBC up 19c to 2304c.
  • Babcock & Brown (BNB) confirm earnings guidance for the current year despite impact of provisions and write downs in the 1H. BNB up 49c to 1275c.
  • Nexus Energy (NXS), oil and gas explorer, has announced that it raised $143m through a share placement with institutional investors – 83.4m shares at 172c each. NXS planning a retail placement in the coming weeks. NXS down on opening – down 4.5c to 182.5c.
  • Centro Properties Group (CNP) in a trading halt this morning ahead of a $2.8bn debt refinancing deadline this morning.
  • Beach Petroleum (BPT) announced it agreed to pay $110m for a 20% stake in an oil field in the Gulf of Suez off Egypt – subject to approval by Egyptian Government and other third parties. BPT up 2.5c to 157.5c.
  • Sally Malay’s (SMY) managing director says the nickel play is one of a few from slim pickings who are key potential takeover targets in a hot nickel sector. SMY down 4c to 493c.
  • Boart Longyear (BLY), the world’s largest drilling services company, raised revenue growth forecast for FY08 to 20-25% from a previous estimate of 15%. BLY up 9.43% to 203c.
  • Three of Russia’s top mining companies – Norilisk, Metalloinvest and Rusal -have merged to form one of the world’s largest mining and metals group- will be worth between $100-$200bn and rank (and compete) alongside the Anglo-Australian duopoly of RIO and BHP and Brazil’s Vale. 

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