The market is up 34. The SFE Futures were down 2 this morning.

The Dow closed down 22 overnight. On Wednesday, the Dow closed up 83 points at its highest level since May. It was down 95 points prior to the Federal Reserve announcement. As expected the FOMC Meeting extended the “extended period of time” that interest rates will remain “exceptionally low” from mid 2013 to late 2014 raising the prospect that interest rates will probably remain on hold in the US at 0-0.25% until 2015 … for another three years. Good for growth. Not good for the US$. Italy sold the maximum amount of €5 billion at a bond auction, helping to drive down borrowing costs. Metal prices were strong overnight, Gold put on another $21.30 to $1721.40 and the Aussie dollar hit $1.06.

Main points … a little quiet after the Australia Day holiday.

  • National Australia Bank (NAB) is struggling to prop-up its UK division, having to recently contribute £130 million into a pension scheme for its British workers. NAB has also transferred £400 million in capital to its UK division to ensure Clydesdale Bank can meet regulatory rules for British lenders. NAB up 2c to 2421c.
  • ResMed Inc (RMD) — fall in profit for the 1st half of the year to $US113.4m, down 2% on last year. Their CEO says the company’s range of sleep masks was poised for more growth. RMD up 12c to 266c.
  • Woodside Petroleum (WPL) say they have stopped production at their Vincent oil field off the coast of WA due to a tropical low system which the BoM say may develop into a tropical cyclone. WPL up 15 to 3432c.
  • Brockman Resources (BRM) up 2c to 212c. They have announced Russell Tipper has joined them from Aquila Resources (AQA).
  • JB Hi-Fi’s (JBH) online sales jumped by 85% in the Dec half from a year ago although they report they are still having to discount prices to compete with online competition. JBH down 9c to 1160c.
  • Discovery Metals (DML) is hitting new highs as the company nears first production from its Boseto copper project in Botswana. The copper price recovery has also helped. DML down 2.5c to 157.5c.
  • One broker lists stocks likely to disappoint this results season including: CPU, ASX, MQG, domestic media stocks, Boral, Cochlear, Bluescope Steel, Lend Lease, Goodman Fielder, Treasury Wine Estates. Stocks that hold potential upside surprises include Toll, mining services companies, Echo Entertainment, Woolworths, Telstra.
  • Wayne Swan says the World Bank and IMF cuts to global growth were factored into the government’s economic forecasts in the Mid Year Economic Review in November.
  • We have a US GDP number tonight and an RBA decision due on the 7th Feb with suggestions that we are now going to see two 25bp cuts in two months. We also have Woolworths and Wesfarmers reporting quarterly sales numbers next week which will be an interesting test of the retail sector

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