MMR July 10

The market is up 65. The Dow Jones finished up 76 overnight. The Aussie dollar kicked up yesterday and has held overnight. From a low of 90.41c on Monday we are now back to 91.57c.

The International Monetary Fund have downgraded their 2013 global growth expectations from +3.3% to +3.1%.

Alcoa kicked off the US reporting season but finished down 0.14% overnight. Earnings came in slightly better than expected but revenue was down 1.9% compared to the previous year.

BHP and RIO finished up 3.26% and 2.51% in the UK after Deutsche Bank upgraded its recommendations on both stocks to neutral from underweight. BHP was up 4.04% and RIO up 1.92% in the US.

IBM finished down 1.89% after Goldman Sachs downgraded its recommendation on the stock to neutral from a buy. US chain store sales were up by 3.6% over the past week compared to a 2.9% gain from the previous week.

Best sectors –energy, industrials, materials. Worst sectors — healthcare, technology, telecom services.

European markets mixed — UK FTSE up 0.98%, Germany up 1.12%, France up 0.52%, Spain down 0.03%, Italy down 0.06%, Greece up 2.32%.

Metals mixed — copper down 0.68%, nickel down 1.24%, zinc up 0.33%, aluminium up 0.20%. Spot iron ore up $1.80 to $123.70. Gold was up $14.20 to $1249.10. Oil was up $1.38 to $104.52.


  • Consumer confidence has improved slightly but remains weaker than it was at the start of the year. The Westpac/Melbourne Institute index of consumer sentiment in July fell slightly to 102.1 from 102.2 in June.
  • News Corp (NNC) — Chairman Rupert Murdoch has agreed to testify before a UK Parliament for the second time as he faces fallout from police and lawmakers over secretly recorded comments he made discussing probes of bribery and phone-hacking at company newspapers.
  • ERA — Has just released its June quarter operational review. Uranium oxide produced was 950 tonnes up 6% from the previous quarter. Uranium oxide is expected to be in the range of 2,700-3,300 tonnes.
  • Transurban (TCL) — Has recorded solid traffic growth on their Sydney and Melbourne roads during the June quarter. Revenue for the quarter was up 6.8% to $207 million. Fourth-quarter toll revenue was $256.5 million up 7.1% on the year. For the year to June, toll revenue was $801 million, up 4.7%. Traffic on its US express lanes increased after they offered a weekend of free travel to help get users acquainted with new, state-of-the-art tolling technology.
  • Virgin Australia’s (VAH) — Its trans-Tasman alliance with Air New Zealand will continue after the ACCC signalled that it would re-authorise the partnership for another three years.
  • Westpac (WBC) — Has issued its prospectus for a $750 million hybrid notes offer.
  • Macquarie Group (MQG 4351c) — Deutsche Bank upgraded its recommendation to buy yesterday with a target price of 5619c – almost 30% above the share price. It argues that the bank is significantly undervalued. MQG’s share price is up 65% in the last year and was up 4.89% yesterday.
  • Rio Tinto (RIO 5204c) — Started shipping copper concentrate from their Oyu Tolgoi gold and copper mine in Mongolia after they were finally able to overcome delays and tense negotiations with the Mongolian government. It has bought the mine into production saying the outlook for copper is strong. JP Morgan has an overweight recommendation with a target price of 7800c.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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