The market is having another good day — up 67. The Futures suggested a 48 point rise. Resources sector doing well — BHP and RIO up 2.6% and 4% respectively.

Dow up 221. Down less than 1% this year now. The main driver was better than expected economic numbers and resources rallying again. US Retailers up a big 6.1%. Consumer discretionary sector up 4.6%. US Automakers up 6.4% despite the GM bankruptcy. Gold down slightly, Oil up 3.4% and Metals all up overnight.

RBA MEETING TODAY — Unlikely to see any change in rates from 3%. A Dow Jones survey of 17 economists shows all expecting no change.

Quiet day on the news front…

  • Rio Tinto (RIO) has settled its iron ore contract for 2009 with South Korean steelmaker POSCO and Taiwanese steelmakers SCS and Dragon on the same terms as its Japanese agreement.
  • Pharmaxis (PXS) in a trading halt pending an announcement relating to a capital raising.
  • Macquarie Group (MQG) says it has no idea why the share price was up 11.8% yesterday. It has also completed its share purchase plan raising $1.2bn.
  • NeptuneMarine Services (NMS) in a trading halt.
  • Macarthur Coal (MCC) says it is not in a position to predict 2H operating profit and is not aware of any reasons why the share price 14.9% yesterday.
  • BlueScope Steel (BSL) up over 5% on the back of US steelmakers having a strong session on Wall Street overnight.

In other news…

  • UBS Warburg maintain their Neutral recommendation on Fortescue Metals (FMG) and 270c target price saying FMG needs to fix operational issues and improve production and costs to win over investors.
  • GSJB Were says BHP Billiton (BHP) is a Buy — “strong balance sheet with organic growth options being exercised”. They have a 4328c target price.
  • Charlie Aitken believes Australian REIT’s have bottomed — highlighting Westfield (WDC) as the standout in large caps.
  • 1Q Current Account deficit came in better than expected — fell by $1.743bn to $4.614bn, which is expected to add 2.2% to growth in the March Q. Economists were expecting $5.43bn.
  • April Building Approvals have exceeded expectations increasing 5.1% (seasonally adjusted) and in the year to April, building approvals fell 16.1%. Economists expected a 2% rise and a 21.7% for the year.

The Dow Futures suggest 6 point fall on Wall Street tonight.

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

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