The market is up 51. The SFE Futures were up 38 this morning.

Dow Jones closed up 278 on its high of the day up 278 points on the back of developments at the EU summit. Described by some as a short covering rally, described by others as the low point in debt crisis sentiment. Spanish and Italian 10 year bond yields both fell significantly. Mixed US economic data didn’t add much. US personal income rose as expected, US spending was unchanged, Core PCE inflation below expectations and the Chicago PMI was better than expected. The Dow Jones finished up 3.8% for the financial year which compares to the ASX 200 down 11.1%.  Metals were all up on the LME — Lead was up 4.82%, Zinc was up 4.72% and Copper was up 4.06%. Gold is up $53.80 to $1604.20. Oil was up $7.27 (9.3%) to $84.96. BHP and RIO ADRs were both up 5.34% and 5.12%. BHP is set to open up 36c on our market today. The A$ is up 2.21c to 102.65c. The “risk trade” is back on … for today at least.

Main points:

  • David Jones (DJS) — Last Friday DJS received a $1.6bn takeover approach by little-known private equity firm EB Private Equity in U.K. There are fears that the takeover approach may in fact be an elaborate hoax, which sent the share price up almost 15% last Friday and down 5% this morning. DJS is down 5% to 246c.
  • Aristocrat Leisure (ALL) — profit warning — ALL provided an update on profit guidance and now expects profit for the 6 months to 30 June 2012 to be in the range of $30m-$33m down from a consensus forecast of $39m. ALL is down 11.96% to 243c. 
  • Lend Lease (LLC) Up 4.5% after saying they expect to post a slight rise in FY profit and is on track to deliver a profit of between $485m-$505m up from $485.3m last year – takes a lot of risk out of the stock ahead of results. LLC is up 4.58% to 753c.
  • Fairfax Media (FXJ) has advised Gina Rinehart in a letter that she must make a bid if she wants to gain control of the company. Two directors have also bought shares – FXJ up 9% to 60.5c
  • Metcash (MTS) completed the institutional arm of their share placement raising $325m. The company says they are looking at purchasing $90m of bolt on businesses. MTS is up 2.37% to 345c.
  • Leighton Holdings (LEI) – The sale of the company’s Thiess Waste Management business has hit another bump as Sita, one of the three bidders has dropped out. LLC still up 3.01% to 1676c.
  • Telstra (TLS) has bought a stake in cloud computing contact centre IPscape. Telstra will use IPscape’s technology for their own virtual contact centre that they use for large corporate clients. TLS is up 1.76% to 375.5c.
  • TD Securities-Melb Institute released their monthly inflation gauge which fell to 1.6% its lowest level since the GFC. This gives the RBA room to cut rates tomorrow although they seem more likely to hold.
  • The AIG/PWC Australian PMI Index rose 4.8 points to 47.2 indicating the manufacturing sector contracted at a slower pace compared to the previous month.
  • RP-Date-Rismark Home Value Index recorded a 1% increase in home values across 8 capital cities in June.

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