The market is up 3. ASX 200 Futures were down 57 this morning. The Dow Jones finished down 209 on above average volumes. The Dow was up 68 at best and closed on its low of the day. A bounce in banks the main driver of our market this morning.

The fall in the market was blamed on the announcement of some MSCI index re-balancing that caused some selling in US stocks. Over the month the Dow Jones was up 1.9% while the S&P 500 was up 2.1% and the Nasdaq was up 3.8%.

The US final estimate for consumer sentiment was 84.5, up from 76.4 in April and the highest level in six years.

The Chicago purchasing managers index was up from 49.0 to 58.7, above expectations for a result near 50.0. This was the highest reading in 14 months. Personal income was unchanged in April with spending down 0.2%, both were slightly below expectations.

China’s purchasing managers index was up from 50.6 to 50.8 in May, beating the 50.1 forecast. China’s PMI for the nonmanufacturing sector fell to 54.3 in May from 54.5 in April. The HSBC Flash Chinese non-manufacturing PMI is out today as well but is below 50 and a bit below expectations.

  • Cochlear (COH) — Profit warning — COH has indicated it expects 2013 financial year NPAT to be in the range $130 million to $135 million, which is a 15% downgrade from 2013 financial year consensus of $154 million (estimate range $146 million to 164 million). Cochlear said it expected to pay a final dividend of at least 125c. COH is down 16.83% this year. In February the share price fell 12.25% after its  profit results disappointed. COH down 12.67% this morning.
  • Telstra (TLS) — Maurice Blackburn lawyers say Telstra could face ‘massive unquantifiable’ liability from the removal of asbestos from thousands of pits and pipes. The number of people affected could run into the hundreds, and Bill Shorten says that if he was a resident living near these pits he would be “furious”. The federal government will discuss the management of asbestos sites with Telstra and unions at a crisis meeting today. TLS is down 7c to 468c. It is down from the recent peak of 515c.
  • Echo Entertainment (EGP) — Echo has promised to invest more than $1 billion to protect their casino monopoly in Sydney and “crush” James Packer’s bid to build his six-star hotel in Barangaroo. EGP is down 1.36% to 291.5c.
  • Transpacific Industries Group (TPI) — Trading update — The company has provided guidance and announced that their CEO intends to resign. TPI is down 11.8% to 78.5c.
  • Inflation rose 0.2% in May — was boosted by an increase in the prices of fruit, vegetables, rents and books. It leaves the door open for further interest rate cuts by the RBA. Inflation rose 2.2% on year.
  • Retail sales were up 0.2% slightly below an expected 0.3% rise.
  • Company operating profits were up 3% in the first quarter, well above an expected 1.5% rise.
  • ANZ job ads fell 2.4% in May from 1.7% in April.

Peter Fray

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