The market is down 5 — exactly what the SFE Futures were down this morning.

Wall Street closed down 2 overnight. The S&P 500 closed up 0.38% but was unable to move past its two-year high of 1235 set earlier this week. Weekly claims for unemployment benefits fell higher than expected. US banks outperformed on reports that they may be able to lift their dividends. The VIX volatility index held below 18 for the 2ndstraight day. The oil price was up 9c at $88.37. Gold increased $9.60 to $1392.80 and the $A rose from 97.91c to 98.46c.

Today’s main points … quiet on the news front.

  • The Reject Shop (TRS) is blaming the RBA’s interest rate rise for its profit downgrade yesterday. Only 2 months ago at its AGM TRS was telling shareholders that sales were running ahead of schedule. TRS up 6c to 1356c.
  • The $278m takeover bid for Tassal Group from private equity has just got complicated with Tassal’s largest shareholder, Webster, selling its 19.8% stake to Singapore’s Pacific Andes Resources Development for 1.79c a share. TGR up 1.5%.
  • Intrepid Mines (IAU) completed their capital raising. IAU down 1.8%.
  • Woolworths (WOW) has denied arguments from Merrill Lynch analysts that it is artificially propping up its earnings figures by booking non-cash items to its bottom line. WOW up 7c to 2621c.
  • Guinness Peat Group (GPG) chairman Sir Ron Brierley has retired and will be replaced by former Macquarie Bank deputy chairman Mark Johnson. Brierley will remain on the board as a non-executive director. GPG unchanged at 53c.
  • AGL Energy (AGK) and Origin (ORG) have been cleared by the ACCC to buy retail electricity assets in NSW’s power privatisation. AGL can only buy one of either Country Energy and Integral Energy and won’t be bidding for EnergyAustralia. ORG can buy any of the three, or both Country Energy and Integral Energy. AGK down 0.75%, ORG up 1.2%.
  • Rio Tinto (RIO) is assuming direct management of Ivanhoe’s (IVA) Oyu Tolgoi copper and gold project in Mongolia, aiming to deliver first production ahead of schedule. Rio has pledged $US1.8bn to the project as it participates in Ivanhoe’s $1.2bn rights offering, taking its ownership in IVA to 49%. RIO down 0.9%, IVA down 2.8%.
  • Storms hit central and northern NSW yesterday, further damaging and downgrading crops, which will support milling wheat prices and further delay the harvest. The weather is all likely to negatively impact GrainCorp (GNC). GNC down 0.15%.
  • The Wall Street Journal has highlighted 20 of the highest-paid executives at listed companies in Australia. (Includes base salary, annual cash bonus and long-term incentives such as deferred share payments). Of the top 10 highest paid, 5 worked for banks. CBA’s CEO Ralph Norris topped the list, earnings ~$1.5m more than RIO’s Tom Albanese, and almost $5m more than BHP’s Marius Kloppers.

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