The market is down 11 after being down 47 at worst — outperforming the 36 point fall predicted by the SFE Futures this morning. Resources taking it in the neck again — down 3% on the back of a 4% and 6.8% fall in BHP and RIO. RIO still hasn’t made an announcement after talks with its bankers regarding its $8.9bn in debt to be refinanced. Speculation over OZ Minerals and asset sales required to bolster its deteriorating balance sheet. Financials up 1.1% – banks mixed nearing midday — ANZ down 0.4%.
The Dow was down 215. Up 112 at best. Down 260 at worst. All 10 sectors down. Credit Suisse announces losses — cuts 5300 jobs. AT&T planning jobs cuts. Merck and DuPont announce FY09 EPS will be below expectations. November’s retail same-store sales sharply down. Initial jobless claims hit a 26-year high. Treasuries push higher in the flight to safety — yields haven’t been this low for decades. The Bank of England cut its target lending rate by 100bps to 2.00%. A$ down 0.64% against the US dollar. Both BHP and RIO down in ADR form overnight, 5.8% and 9.7% respectively. Metals mostly down. Oil price down 6.4% to $43.80. Gold down $5 to $765.50.
Making the news today…
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- Felix Resources (FLX) said there is an interest in their company regarding a potential $3bn+ merger.
- Fortescue Metals Group (FMG) said it suspended its long-term shipping contracts due to changed market conditions.
- Albidon (ALB) has provided an Investor Update — they are undertaking numerous reviews of costs and non-essential spending due to the deteriorating nickle price.
- Fairfax Media (FXJ) — David Kirk has resigned as CEO of the company effective immediately, Brian McCarthy will act as interim CEO.
- ING Office Fund (IOF) intends to raise $400m through institutional share placement at 80c, a 22% discount to the share price.
- Westpac Bank (WBC) has appointed a new CEO for its New Zealand operations.
- Lion Selection (LST) has completed its $150m off-market share buy-back.
- The NAB have announced a few executive changes.
- Timbercorp (TIM) says it is not aware of any information regarding its share price movements.
Broker Stuff today…
- ABN AMRO has resumed coverage on BHP Billiton (BHP) with a BUY recommendation and 3612c target price, although they did cut their earning estimates by 2.8% in FY09 and 4.5% in FY10.
- A bit of research this morning on Crown (CWN) after they successfully raised $1.6bn which will be used to repay debt. Macquarie expect the stock to OUTPERFORM with a 768c target price, GSJB Were maintain their HOLD recommendation and 749c target price.
- JP Morgan upped their recommendation on Nufarm (NUF) to OVERWEIGHT from NEUTRAL and maintain their 1200c target price after its AGM yesterday. Credit Suisse cut their target price to 1480c from 1930c and say, “we believe the stock trading at 7x PE remains oversold.”
- Just about all brokers cut their targe prices on Billabong (BBG) after their profit downgrade yesterday. Both Macquarie Equities and UBS Warburg remain postitive on the stock.
Other Stuff today…
- Day traders had a big day in Babcock & Brown yesterday. The stock moved in a 35% range and the price was up 56% on volume of 41.57m shares or 27% of the total shares on issue — but overall traders lost $3,847,017m overall based on the volume weighted average price.
- Merrill Lynch says the oil price is going to US$25. The oil price falls 6% to $43.
- The Dow Futures suggest a 19 point rise on Wall Street tonight.
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