The market is down 29. The SFE Futures were down 11 this morning.

Dow Jones closed down 26 up 70 at best and down 103 at worst. Almost all US economic numbers disappointed. 2nd Q GDP was revised down to 1.9% from 2.2% (much as expected). The ADP Employment number fell short of forecasts (133,000 versus Est 150,000) not a great lead into the main job numbers tonight. Chicago PMI was down from 56.2 to 52.7. European shares saw the FTSEurofirst index at five month lows. The German DAX was down 0.26% with the UK FTSE up 0.18%. 10 year bond yields rose again with the Italian 10 year bond yield now at 5.87% and Spain’s up again to 6.51%. Gold was down $2.70 to $1560. Oil was down $1.27 to $86.55. Metals were down with Zinc the worst down 1.14%. A$ is down at 97.27c (low of 96.74c). ADRs are down with BHP closing down 35c on last night’s close in Australia.

Main points:

  • Chinese PMI numbers are disappointing this morning. A reading of 50.4 was below consensus of 52. Aussie dollar fell to an intraday low of US$0.9668. Resources hit hardest. Markets are now alive to the possibility of an RBA interest rate cut next week.
  • 10 points of the market fall is thanks to BHP, NCM and RIO.
  • Oil prices fell for a third straight day to an eight month low. Saudi Arabia’s Oil output rose to its highest level in at least 23 years.
  • BlueScope Steel (BSL) is facing a tax bill of up to $203m over an equipment sale and lease-back signed off in 2007. The ATO plans on sending the company an amended tax bill for 2007 and 2008. BSL says they will object to the tax bill and pursue all necessary avenues. If unsuccessful a payment of $203m will put pressure on an already troubled balance sheet. BSL is down 5.8% to 32.5
  • Echo Entertainment (EGP) has booked a $30m writedown associated with their international high roller business after SilkStar Global Marketing was placed in liquidation and has not repaid fees and commissions. EGP 432c down 1.8%.
  • Elders (ELD) says agribusiness Ruralco Holdings has taken a 10.1%  stake in the company to strengthen their participation in the agribusiness sector. Rural Co says they have no plans to launch a takeover. ELD is up 10.81% to 20.5c.
  • David Jones (DJS) — Three brokers have target prices below the current share price after sales numbers yesterday.
  • Fortescue Metals Group (FMG) says once they reach their 155 million metric tons production target they will look to repay debt and attract an investment grade rating. FMG down 4c to 458c.
  • Changes in the ASX S&P indices see Alumina, AQP, CSR, DTE and ERA losing out and DXS, AUT, SPN, CDD and MTU getting a bunk up.
  • Australian manufacturing activity fell in May for the second month down 1.5 points to 42.4. Readings below 50 indicate an contraction in activity.
  • Cape Lambert (CFE) down 25% on a $95m tax bill.
  • Qantas (QAN) — Saying Emirates is not going to buy a stake.

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