The market is down 8 after being up 37 this morning. The SFE Futures were up 4 this morning.
The Dow closed up 44 points overnight. Italy confirmed that it has been in discussions with China about buying Italian bonds but the euphoria has faded a bit on the realisation that the Chinese are unlikely to do much more than buy Italian assets at fire sale prices in millions not billions. The Greek, French and German leaders hold a conference call tonight to discuss Greece’s debt crisis. Merkel says Greece is not a quick solution as was suggested by a member of her coalition party earlier this week. The US budget deficit grew by more than expected in August. The gold price was up $16.80 to $1830.10, while the oil price was up 2.02¢ to $90.21. The Aussie dollar was down at 103.15¢ from 103.58¢.
Today’s main stories…
- Sigma Pharmaceuticals (SIP) reported its first half profit was up 112% on the prior first half, to $26.65m. But they say their performance in the remainder of the year is likely to be impacted by reforms to the pharmaceutical benefits scheme. They announced an interim dividend of 1.5 cents per share. SIP up 14.4%.
- Cochlear (COH) down 7.9% to 5534¢ after Citigroup cut its target price to 4390¢ from 6208¢. That follows the recent product recall.
- Qantas (QAN) CEO Alan Joyce said they plan to have five carriers flying to China. Qantas and Jetstar already fly into China, while the company’s Vietnamese offshoot and the new carriers QAN is creating in Japan and South-East Asia may fly to China as they seek a larger share of the growing aviation market. QAN up 1¢ to 150¢.
- The Australian Financial Review reported that Boral (BLD) is seeking to offload its PT Jaya Readymix business in Indonesia and its Concrete & Quarries division in Thailand. It has been suggested that the sale could bring in $150m. UBS is advising Boral on the process. BLD down 1.2%.
- The market’s fall on Monday has forced Momentum Corporate to postpone its plans for a $120m IPO of department store Harris Scarfe. Momentum still hopes to proceed by the end of the year.
- Leighton Holdings (LEI) has appointed Bruce Munro as managing director of wholly-owned subsidiary Thiess. LEI down 2.2%.
- The Westpac-Melbourne Institute Index of Consumer Sentiment showed that consumer confidence rebounded strongly in September. The index rose 8.1% in September to 96.9 after it fell to 89.6 in August, its lowest level since May 2009.
- Housing starts fell 4.7% in the March quarter and dropped 18.6% in the year to June 2011.
Lots of stuff happening in Europe … with the thrust of it being last ditch attempts by the Greek PM to put in unpopular measures to meet terms of the next tranche of bailout funds from the EU and ECB. He seems to be hitting some of those terms although it is clear that some of the major European governments see the writing on the wall, a default by Greece, and they are preparing to handle the fall out from that for both Europe, the euro and their own exposed banks.
What will be interesting is whether a Greek default lances the boil and the markets find a reason to rally (the opposite of what you would expect is usual), if Lehman Brothers is anything to go by, they won’t, although the event will accelerate the eventual bottom of the market. Read more at MarcusToday.com.au
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