The market is down 65. The SFE Futures were down 58 this morning. As we write the Dow Futures are down another 105 points.
Dow Jones closed down 275 — down 286 at worst on disappointing job numbers. Worst day this year. Dow 10% off April highs. Employment numbers fell short of expectations with only 69,000 new jobs in May (versus Est of +150,000) and last months numbers were also revised down by 50,000 jobs. US unemployment now at 8.2% up from 8.1% raising the suggestion that the US economic recovery has now peaked — added to weak Chinese PMI numbers last week and the concept of a global economic slowdown is beginning to take hold. Gold was up 3.70%. On the last two occasions the Fed announced a quantitative easing package (which is inflationary) gold surged. Metals were down on the LME except Zinc. Aussie dollar down buying $96.97.
- 27 points of the market fall are thanks to BHP and the banks.
- TD Securities — Melbourne Institute monthly Inflation Gauge which up 1.8%, relatively soft in May compared with April. This is the third consecutive month the rate of inflation has been below the RBA target range of between 2%-3%. The weak inflation data gives the RBA plenty of room for a rate cut tomorrow.
- RBA meeting this week with talk of a 50bp rate cut. GDP numbers on Wednesday — expecting +0.5%. Jobs numbers on Thursday. Westpac’s economist making headlines last week with suggestions that rates will be 2.75% by the end of the year.
- Brambles (BXB) announced plans to raise $448m by raising new shares via a pro rata entitlement offer. The offer is a fully underwritten 1:20 accelerated renounceable entitlement offer with retail rights trading. Shares offered at a price of 605c representing 10.9% discount to the pre-bid price.
- Seek (SEK) has launched a subordinated notes offer to raise $125m to be used to repay part of the company’s existing debt facility.
- Fortescue Metals Group (FMG) are forecasting an iron ore price of US$110 a tonne in their projections. Below the current price of $135/ton.
- Brickworks (BKW) is believed to be against a proposal to unravel their cross shareholding with Washington H Soul Pattinson (SOL) due to the costs involved and because it may not be in the company’s best interests.
- ANZ released the Job Advertisements Survey which reported a fall of 2.4% in May compared to a 0.8% drop in April. Trends are showing a softening in labour demand. They fell for the second consecutive month and demand for labour fell even in the mining boom states.
- The Australian Bureau of Statistics released the Business Indicators Data which showed company gross operating profits fell 4% in the March quarter. The consensus forecast was for -2.5%. First quarter inventories rose by 0.9% above the consensus forecast of 0.7%. The Australian dollar has fallen slightly after the release of this data.
For a five day FREE TRIAL of the MARCUS TODAY newsletter Click Here. You will receive our renowned and popular Daily email about the stockmarket with all the stuff you need to know ahead of the trading day including:
Get Crikey FREE to your inbox every weekday morning with the Crikey Worm.
- Overnight developments, news, comments, rumours, broker recommendations and ideas from Marcus and his Team.
- Our Portfolio recommendations which is actively managed on behalf of subscribers … no “set & forget”. Everything you need to effortlessly
- managed your own long term investment portfolio.
- Daily Technical Trading ideas and data, including daily scans of the ASX 300 for stocks changing trend.
- Stock Database — all the numbers with comments on the top 300 stocks and more.
- Educational section — Marcus’s Educational and Entertaining articles.
Subscribe to MARCUS TODAY. We are sure you will enjoy and profit from what we offer … we have one of the highest re subscription rates in the financial newsletter industry.