The market is down 29 outperforming the 96 point fall predicted by the SFE Futures this morning. Financials down 2% — banks down 2-3%. Resources down 1.4% on the lower oil and metal prices. Energy stocks up 0.3%. BHP and RIO down 2.1% and 3.9%. Base metal stocks mixed. Gold stocks doing well on the higher gold price overnight with the flight to precious metals continuing. Newcrest up 3.0% and Lihir up 4.1%. Property stocks doing the worst — down 3.2%. Westfield down another 4.6% and Stockland down 3.3%.

The Dow was down 226. 4-day winning streak over but up 1.6% week-to-date. All 10 sectors in the red. Deepening recession fears cause a sell-off. Unemployment at record highs. New home sales at record lows. Worst jobs and housing figures in over 40 years. Obama’s $819bn bailout passed through the House yesterday afternoon. The Wall Street Journal reported that congressmen are discussing an additional US$1-2 trillion bailout for the banks. Financials down 8.4%. Resources down. Gold up. Bonds down. More poor 4Q results. More job cuts. Ford lost US$5.9bn in the 4Q. All eyes on the advance quarter GDP report tonight – consensus forecasts a 5.5% annualized 4Q decline in GDP.

  • OZ Minerals (OZL) posted their quarterly report — said its asset sales are progressing excellently. Said progress on its loan facility negotiations for US$560m to be rolled over by the 27 Feb was proceeding well. Will cut 1200 jobs (17% of workforce).
  • Harvey Norman (HVN) said sales were up to $3.15bn, up 3.5% over the second half — like-for-like sales up 1.4%.
  • Orica (ORI) said 1Q profit was up and in-line with target — said they are focused on organic growth.
  • Australian Worldwide Exploration (AWE) reported it’s actively seeking acquisitions as its quarterly production of oil and gas fell 16% in the 2Q — down to 2.12m boe from 2.52m.
  • Tabcorp Limited (TAH) is out of its trading halt after its $300m institutional placement.
  • Platinum Australia (PLA) says it expects to be suspended from official quotation for more than five working days in respect of its capital raising.
  • Nido Petroleum (NDO) reported 4Q revenue at $5.99m and cash-on-hand at $12.27m. Says the drilling program was on schedule and on budget. Produced first oil at their Galoc field.
  • Beach Petroleum (BPT) reported record oil and gas production in the quarter — 872,000 bbl.
  • ERA Resources (ERA) reported FY ranger resources up 128% on-year. Net profit $221.8m with final dividend of 20c.
  • Riversdale Mining (RIV) reported Benga coal reserve at 2.1bn tons at Dec — to complete the final feasibility on Benga in 1st Q 2009. Cash-on-hand at $326.1m at Dec 31.
  • Bannerman Resources (BMN) reported positive drilling results for the quarter; successfully secured $20m in new capital and appointed a new CEO.

Broker Stuff…

  • Tabcorp Holding (TAH) have had their price target cut by Merrill Lynch and GSJB Were to 670c and 708c from 775c and 810c respectively following their profit announcement and capital raising yesterday. Brokers said TAH would struggle to grow earnings in the short term. Macquarie Group keep NEUTRAL with 700c target.
  • Suncorp-Metway (SUN) kept at NEUTRAL by Merrill Lynch but had its target cut to 900c from 1000c. Merrills wary of 1H report due next month.

Other Stuff…

  • December’s Australian private sector credit growth eased to an annual pace of 6.7% from 8.2% in November — the slowest pace since April 1994. Lending down sharply for both business and personal credit despite aggressive interest rate cutting by the RBA. Strengthens the RBA’s argument for a 100bp cut next Tuesday to below 4.0% — that will be the lowest since the mid-1960’s.
  • The Dow Futures suggest an 11 point fall on Wall Street tonight.

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