The market is up 9. The SFE Futures were up 64 this morning.

The Dow Jones closed up 88 overnight. Dow up 91 at best and down 103 at worst. Focus has now shifted to Italy which faces a key parliamentary vote on budget reforms. We saw a rally after an ECB executive board member Juergen Stark said that the euro region’s debt crisis would be under control in two years at the latest (implying it will be out of control for two years!). If Italian Premier Silvio Berlusconi fails to win majority support in the vote on the budget report he may be forced to resign. Italian 10-year bonds fell with yields rising sharply to 6.6% – their highest since 1997. US consumer credit came in higher than expected and German industrial production fell by 2.7% in September, much worse than market expectations of a 0.9% decline and the 0.4% slippage reported in August. The gold price was up $41.40 to $1796.50.         

Main points:

  • Commonwealth Bank (CBA) has held their AGM today. Chairman David Turner told shareholders they expect subdued credit growth to continue into next year, and that gains in productivity will drive improvements in their performance. He said, “Fundamentally, it comes down to confidence”. Outgoing CEO Ralph Norris also said the bank was continuing to pursue a growth strategy in Asia.  CBA up 4c to 4936c.
  • Orica (ORI) up 11c today to 2553c after receiving a positive response to their FY result yesterday from analysts. Many of them have upgraded their target prices.
  • Computershare (CPU) has also received a positive write up from brokers this morning after their BNY Mellon deal received regulatory approval yesterday. CPU down 14c to 830c after putting on over 10% yesterday.
  • Newcrest Mining (NCM) will borrow $US1 billion in 10- and 30-year bonds to repay existing debt and fund major projects. They are offering $US750 million of senior unsecured notes due on November 15, 2021, with a coupon of 4.45% and $US250 million due on November 15, 2041, with a coupon of 5.75%. NCM up 1% to 3610c.
  • Westfield Group (WDC) have reaffirmed its annual earnings guidance for CY2011. They confirmed their operational segment earnings guidance of 48.4¢ per security and their distribution guidance of 48.4¢ per security. They say they continue to achieve income growth in all markets. WDC up 1c to 773c.
  • Fortescue Metals Group (FMG) expects to avoid paying the planned mineral resources rent tax (MRRT) for at least five years thanks to the write-offs the government plans to make available to major resource companies. FMG’s Andrew Forrest has previously said the mining tax would hit the sector hard. FMG up 5c to 493c.
  • Fairfax Media (FXJ) has set the price on the IPO of 34% of their Trade Me Group at NZ 270c a share. They will realise NZ$529.5m from the sale. FXJ last traded at 93c

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