The market is up 52 after being up 96 earlier in line the 88 point rise predicted by the SFE Futures this morning. Financials and property leading the way as the US government unveil their US$1 trillion public-private partnership bank plan. All the banks up but coming off morning highs — CBA outperforming.

The Dow was up 497. Up 502 at best. Up all session. Dow Jones up 6.84%. S&P500 up 7.08%. NASDAQ up 6.76%. All 10 sectors up at least 3.8%. The market rallied as the US Government announced their US$1 trillion plan to solve the banking sector’s woes. Financials up 17.7%. Treasury’s Geithner said they would use funds from the US$700bn Bank Bailout Plan along with assistance from the Fed, the Federal Deposit Insurance Corp and the private sector to help clear the troubled assets from the balance sheets of struggling financial firms. Bill Gross from Pimco said that the world’s largest bond fund will take part in the program. Homebuilders up strongly on February’s existing homes sales rising a surprise 5.1% on-month to a seasonally adjusted 4.72 million – economists were expecting a 0.9% fall to 4.45 million. The energy sector was the second best performer — up 7.8%. BHP and RIO both up in ADR form overnight — 8.07% and 16.38% respectively. Metals mixed. Oil up with May futures up over 3%. Gold down. Bonds down. A$ up.

OZ Minerals (OZL) will wait an extra 90 days as the FIRB extend the time on their analysis of China’s Minmetals’ $2.6 billion takeover bid for the copper-zinc miner — OZL had hoped for a quick approval due to its $1.1bn in debt due at the end of March — will now has a tough task of convincing it’s bankers to wait for the FIRB approval.

AFR’s Street Talk speculates this morning that a bid for Santos or Oil Search is on the cards with a number of parties having run the slide rule over them. They report Origin Energy and Shell teaming up to bid for Santos. Oil Search has appointed JP Morgan as a bid defense adviser.

  • Tabcorp Holding (TAH) will raise $200m through a five-year bond issued at 4.00-4.50% to retail and institutional investors. The proceeds will be used to pay down debt.
  • United Group (UGL) secured an $8.6bn alliance agreement to supply electricity substations for Energy Australia in NSW.
  • Arrow Energy (AOE) sold its stake in Pure Energy Resources (PES) into BG Group’s (BG.LN) for $1.03bn takeover offer for the coal seam gas producer. AOE will receive $215m for its 20% stake.
  • Australian Worldwide Exploration (AWE) — Made an announcement about Vietnam yesterday, all good. Some research around today. One of the best leveraged stocks to the oil price.
  • Albidon Resources (ALB) is in a trading halt pending the hopeful finalization of funding arrangements — if the arrangements are not achieved the firm will go into voluntary administration.
  • Macquarie Countrywide (MCW) sells 5 properties for $93m to reduce debt.
  • Mineral Deposits (MDL) out of a trading halt upon finalizing a C$33m placement at C$0.52 /share.
  • Ramelius Resources (RMS) raised $13.4m for the WA underground.

Other…

  • CSL is notably down today as a big US fund manager relentlessly sells a 7% holding into the market. Other defensive industrials like Woolworths and Fosters also down. They are on the bottom of the list of financial recovery stocks.
  • BHP cut to UNDERPERFORM from Neutral by Credit Suisse who cut their price target to 2800c from 3200c on lower earning forecast assumptions — mostly on lower iron ore and coking coal export assumptions given the fall in steel demand.
  • Bluescope Steel (BLS) cut to NEUTRAL from Overweight by JP Morgan — price target cut to 340c from 520c. Cuts FY earnings forecast by 68%.
  • Toll Holdings (TOL) downgraded to HOLD from Buy by Citi after their recent strong run up outperforming the ASX 200 by 23% since February.
  • The Australian interbank cash rate futures are predicting only a 25bp cut by the RBA next month — expectations being wound in form the 50bp cut being anticipated earlier in the month.

The Dow Jones futures suggest a 22 point fall on Wall Street tonight.

MARCUS PADLEY is the Author of the MARCUS TODAY Daily Stockmarket Newsletter.

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