The market is down two points.The Dow Jones finished down 31. It was up 27 at best and down 58 at worst. It is down 3.7% from the high this month or down 577 points. As you can see in the two year chart below it has broken the short term uptrend.

It was options expiry in the US creating a jump in volume.

The S&P 500 closed down five to 1656. 1655 is seen as a significant support level. It has dropped just below its 50 day moving average.

A host of economic numbers were released in the US on Friday including retail sales, CPI, Empire manufacturing, the Philadelphia fed index, housing starts, and building permits. Most were in line with expectations. The University of Michigan consumer sentiment number came in below expectations at 80.0 down from 85.1 in July (a six-year high).

The iron ore price fell $3.30.

Gold up $10.10 to $1371.

June TIC flow data saw the biggest monthly withdrawal from the US bond market since August 2007 on the back of Chinese and Japanese selling.

BHP down 0.73% in the US and RIO down 0.92% — BHP closed at the equivalent of 10c down on its close here on Friday.

A$ at 91.84c. It is up from a recent low of 88.48c and down from a high of 92.21c a week ago.

Metals up as the US$ fell. Nickel up 1.87% and copper up 1.22%.

US performers— Wal-Mart down 2.6% on results. Cisco Systems down 7.17%.

The Japanese market was down 0.75% on Friday. The Chinese market was down 0.64%.

European markets mostly up. UK up 0.26%. France up 0.75%.

Oil price up 13c to $107.46. Violence in Egypt remains a focus.

US Economics tonight— None

In Europe tonight — German PPI

US Economics overnight:

  • Housing Starts: Actual 896K, consensus 895K, prior 836K (revised 846K)
  • Building Permits: Actual 943K, consensus 934K, prior 911K (revised 918K)
  • Productivity-prel: Actual 0.9%, consensus 0.0%, prior 0.5%
  • Unit Labor Costs: Actual 1.4%, consensus -0.3%, prior -4.3%
  • Michigan Sentiment: Actual 80.0, consensus 85.1, prior 85.1.

RESULTS & ANNOUNCEMENTS

  •  Bendigo & Adelaide Bank (BEN) — Cash profit up 7.7% to $348 million which was in line with a consensus forecast of $348.2 million. Net interest margins were up 10 basis points to 2.21% for financial year 2013. Financial year dividend of 61c fully franked. ROE 8.6%.
  • Amcor (AMC) — Net Profit $689.5 million up 8.6% and above an expected $671.9 million. The impact of a high Aussie dollar reduced profit by $13.8 million. Significant items were $88.9 million. Dividend of 40c up 8.1%.
  • Bluescope Steel (BSL) — Net loss of $84 million which was an improvement of $960 million from last year. Underlying profit of $30 million which was better than an expected $24.4 million. They don’t expect 1H14 profit to exceed 2H13. No final dividend. The company also announced the acquisition of Orrcon and Fielders from Hills for $87.5 million.
  • Fleetwood Corp (FWD) — Net profit of $12.45 million down 77% and below expectations. Revenue was down 13% to $333.9 million. EBIT down 69% to $24.5 million. Net debt at $32 million. Trading conditions were weak in 2013. Demand for accommodation from the resources sector fell significantly. Interim dividend of 30c. The company issued a profit downgrade in May, so much of the result was expected.
  • Aurizon Holdings (AZJ) — Underlying profit of $487 million up 16% and above an expected $477.7 million. Financial year 2014 coal haulage volumes expected to be up 5% to 200 million – 205 million tonnes. Underlying earnings $754 million up 29%. Final dividend 8.2c. The company sees the resources sector growing at more moderate levels.
  • Challenger (CGF) — Net Profit $416.8m more than doubles and above expectations. Annuity sales of $3.1bn with $10.8bn now under management. Dividend of 10.5. Guidance for Life’s cash operating earnings of between $465m-$475m.
  • Federation Centres (FDC) — Net profit of $212.7 million which was below an expected $221 million. Final distribution of 7.5c per security, 14.1c total. Financial year earnings are forecast to be in the range of 16.5c-16.8c per security.
  • Imdex (IMD) — Net profit down 58% to $19.4 million and below an expected $20.9 million. Revenue was also down, 14% to $232.8 million. Fully franked dividend of 0.4c. The company said their results reflected continued subdued activity within the minerals sector due to a cyclical industry slowdown.
  • Dexus Property (DXS) — Financial year net profit of $514.5 million. Funds from operations of $365.4 million or 7.75c which was slightly below an expected $369 million. Distribution per security grew by 12.1%. Delivered a ROE of 11.2%.
  • Hills Holdings (HIL) — Has announced that they have signed an agreement to sell their steel assets – Fielders and Orrcon to Bluescope Steel (BSL) for $87.5 million.
  • Patties Foods (PFL) — Financial year 2013 NPAT of $17 million which was in line with consensus forecasts.

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Peter Fray
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