The market is up 13. The SFE Futures were down 15 this morning.

US markets were closed for the Memorial Day long weekend. The Dow Futures were up 82 at the close last night and are up 41 this morning. The Greek stock market was up 6.87% on the back of the weekend’s healthy opinion polls which suggested pro austerity/bailout parties may be able to form government. European markets were mixed with the Spanish stock market down 2.17% after the recently nationalised (rescued) Bankia bank fell 13.4% on re-listing post the announcement that they needed €15 billion to re-capitalise. The UK FTSE was up 0.09%. Oil was up 29c to $91.15. Gold was up $4 to $1573. Metal prices were mixed with copper up 0.53%. A$ was up to $98.53 from $98.21 yesterday.

Main points:

  • The market was down 30 early on this morning but is now up.
  • Greek banks got €18bn from the EFSF and jumped dragging the Greek market up 6.87% – helped by Greek polls.
  • The Spanish Prime Minister says Spain is not seeking an outside rescue package for its troubled banking sector.
  • Spanish bond yields going up – now at 6.479% – at 7% it becomes a problem. The ECB are likely to step in again before then. No sign of them yet.
  • China fast tracks three steel construction projects suggesting they are ‘pro growth’ and giving resources a boost.
  • Lynas (LYC) is the traders stock of the day helped by a broker recommendation and a target price 92% above the current share price. It has just broken a downtrend in place since January.
  • Bells cut their FMG target price by 15% to 740c to factor in lower iron ore prices. They say they will need additional capital if they see a sustained iron ore price under $120/t. The company retain a $120-150/t forecast and say they have not deferred any cargoes (some Vale cargoes having issues). FMG price now 470c.
  • Suncorp Group (SUN) announces better guidance. SUN is down 8.59% since the start of the year and is trading on a PE of 12.5x.
  • Tatts Group (TTS) announced the issue of a 7 year Tatts Bond to raise $200m. The indicative margin will be in the range of 2.90%-3.10%. Implied rate of 6.44%-6.64% based on the 3 month bank bill rate of 3.54% as at 25 May. Bonds to listed under TTSHA. Proceeds will be used to repay existing debt.
  • BHP Billiton (BHP) is expected to announce a $7bn write down to their US shale gas business when they report their financial results for the 12 months ending June 30. BHP is down 12% since the start of the month, hitting a low of 3101c. The last time BHP fell to this levels was March 2009.
  • AGL Energy (AGK) announced the completion of the institutional component of their fully underwritten 1:6 pro rata renounceable entitlement offer raising $361m at 1445c per share.
  • Housing Industry Association new home sales rose 6.9% in April following a 9.4% fall in March. The spike could be due to new home buyers seeking to claim the first home buyers grant before the June 30 cut off.

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