The market is up 23 points. The Dow Jones finished down 48 — it was down 93 the day before. It was down 98 at worst. Now 15471.

The S&P 500 closed down six and is below 1700 at 1691.

The Japanese market was down 4.0% yesterday. The Chinese market was down 0.67%.

A$ under 90c to 89.94c. Interesting that the US$ is falling and the A$ falls more. The USD broke below its 200 day moving average overnight. The US dollar index at 81.60.

MBA Mortgage index rose 0.2% breaking a run of seven weeks of falls.

Consumer credit numbers stronger than expected.

The UK took a bit of a dive (down 1.41%) on the Bank of England inflation letter which said that it would keep interest rates on hold until unemployment dropped below 7.0%. The interpretation of that is that it is seeing an improving unemployment trend, seeing the green shoots of recovery and that interest rates will rise sooner than expected. On the back of that the GBP rose — talk of  lifting rates next year.

Gold down up $2.90 to $1286.

Metal prices mixed … Nickel down 1.73%.

Resources quiet with BHP down 0.36% and RIO up 0.17% in the US with BHP closing at the equivalent of 15c up on its close in Australia yesterday.

European markets mostly down — the UK FTSE down 1.41%, the German Dax down 0.47%, the French CAC up 0.15% with Spain up 0.52%, Italy up 0.93%, Greece up 0.02%.

Oil price down 93c to $104.37.

Spot iron ore was up yet again — by $1.70 to $133.10.

US Economics last night — MBA Mortgage Index: Actual 0.2%, prior -3.7%. Consumer Credit: Actual $13.8 billion, consensus $16.0 billion, prior $19.6 billion (revised $17.5 billion)

US Economics tonight — Initial weekly jobless claims, continuing claims.

In Europe tonight — ECB Monthly Bulletin, German Trade balance.

In Asia today — China Trade balance numbers, Japanese current account balance.

ANNOUNCEMENTS & STORIES

  • RIO results are due out this afternoon (just before the close?).  Results should be good — if you remember its production numbers recently had a record iron ore production number and the price rallied. Profit expected to fall 18%.
  • Chinese trade numbers today are all important — especially to the iron ore stocks — the iron ore price is encouragingly up $1.70 overnight to $133.10  — China has been criticised in the past over these numbers, that they are a figment of China’s imagination but the new regime is making efforts to improve the integrity of the numbers. Exports are the main number of interest — they are expected to be up 2%.
  • Australian unemployment number today — expecting the headline rate to rise from 5.7% to 5.8% (highest since April 2009) … some expecting 5.9% with the Treasurer recently forecasting a rise to 6.25% next year. The number is a bit volatile and depending on the participation rate it can surprise. Expecting a rise of around 6500 jobs. A number below that will raise the prospects of a rate cut by the end of the year which are currently running at around 75%.
  • Bank of Japan press conference today — expect them to reiterate previous stimulus policy and make no changes to rates. The Yen has been rising and the meeting is of most interest to foreign exchange traders. Any pull back on the stimulus message (unlikely) will kill it.
  • Telstra (TLS) — Results in line with expectations — See above. Has reported a net profit of $3.813 billion up 12% and above the $3.77 billion consensus forecast and above last year’s $3.405 billion. It expects to grow revenue and earnings in the year ahead as they build their 4G mobile network. Revenue was $25.68 billion up 1.2% from $25.37 billion fully-franked financial year dividend of 28c payable on September 20.
  • BWP (241c) — Profit results in line with a profit of $75.8 million against forecast of $75.2 million. Earnings of 14.1c as expected. In a trading halt pending a one for 6.18 entitlement offer to raise $200 million at 230c vs current share price of 241c (4.1% discount). It is buying 10 Bunnings Warehouse properties from Wesfarmers (WES). The acquisition will cost $312 million and is expected to be 2% earnings in 2015. Should be well received.
  • Wesfarmers (WES) — Has announced the sale and leaseback of a portfolio of 10 Bunnings stores to BWP to release $271 million.

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Peter Fray
Editor-in-chief of Crikey
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