The market is down 41. Resources down 2.1% following the move down in US resources overnight. Financials up 0.5%.

Dow down 12. Up 94 at best. Down 64 at worst. The strength in the tech sector offset losses in financials and energy. SFE Futures down 29 this morning. 5 out of 10 sectors posted a gain. Tech heavy Nasdaq outperformed – up 0.9%. Financials down with Bond insurers Ambac and MBIA, down 16% and 17%, having their credit ratings under review for a downgrade by Moody’s. Bernanke used the words “significantly higher” inflation [than the Fed wants], in academic speech at Harvard, which dragged on the financials in the afternoon. Banks sector hit the lowest level in 8 years on Bernanke’s Harvard talk. Energy sector down 1.2% as crude prices fell 1.8% to $122.04 /barrel – weekly government report showed increase in inventories. Fed and Securities and Exchange Commission said they haven’t put pressure on Lehmans to raise more capital. Regulators have suggested that Lehmans isn’t facing the same pressure that drove Bear Stearns near to bankruptcy. Chevron and ConocoPhillips led the energy index down to the lowest level since May 5th. The Energy Index is 7% off its all time high in May and crude has fallen 5% since its high.

  • Both BHP and RIO down in ADR form overnight, 0.56% and 3.2% respectively. BHP down 143c to 4302c. RIO down 538c to 13487c.
  • Metals mixed overnight – Copper down 0.4% and Aluminium down 1.7%. Nickel up 2.1% and Zinc up 2.3%. Zinifex up 13c to 933c.
  • Oil price down $2.03 to $122.30 after the U.S. Energy Information Administration said crude inventories fell by 4.8m barrels last week. Analysts were expecting a 2.7m barrel increase. Woodside down 426c 5934c.
  • Gold down $1.70. Newcrest down 64c to 3105c
  • US Bonds down with the 10 year yield up to 3.97%.

The Midwest takeover battle continues – Sinosteel bought another 16.2m shares and upped its stake in the company to 28.37% after another major shareholder decided to flog their stake. They say they are confident on the merger proceeding and that the two companies are working closely to sign a Merger Implementation Agreement in the coming days. MIS down 29c to 644c.

  • Economists are expecting Australia’s April trade deficit to fall between $1.7bn from $2.7bn last month despite the strong Aussie dollar.
  • APRA chairman says financial markets are not yet comfortable that the worst of the credit crisis is over, with sentiment remaining “fragile”.
  • Primary Health Care’s (PRY) auction of its Symbion assets set to enter its final stages. PRY up 4c to 624c.
  • The rumours around yesterday that Macquarie Group (MQG) might bid for Babcock & Brown (BNB) have been widely dismissed. Babcock had a shocker yesterday. MQG up 164c to 5314c. BNB up 4c 1065c.
  • Valid (VPG) have successfully completed their VOF12 capital raising, and will invest in a $60.7m diversified portfolio of assets that were sourced and warehoused by Valad. VPG 0.5c to 100.5c.
  • CSL Limited (CSL) and Arana therapeutics have successfully completed their second collaborative project which triggers a payment from CSL to Arana. CSL up 24c to 4028c.
  • Origin energy (ORG) announced the completion of drilling and testing at the Kupe development Wells offshore Taranaki Basin, NZ. The wells will start producing in the middle of 2009. ORG down 20c to 1570c.
  • Woodside (WPL) down nearly 10% over the past 2 sessions on the back a weaker oil price. WPL down 426c 5934c.
  • Perilya (PEM) doing well in early trade with a “spectacular” drilling result at Mount Oxide copper resource – drilling result highlighting the upside potential to Mount Oxide’s expansion. PEM up 1.5c to 73c.
  • Indophil Resources (IRN) has extended its share offer for Lion Selection (LST) until Monday 7 July 2008. IRN flat at 111c.
  • Mitchell Communications (MCU) has been awarded the Western Australian Government Campaign Advertising Service contract. MCU up 1.5c to 68.5c.

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