The Market is down seven points. The Dow Jones was down 73 points to 15,546. The market fluctuated between being “up and down” over the session and closed near its lows in a 100 point range.
The S&P was down seven to 1757.
Earnings were a key driver — generally mixed. Visa (out after market close on Wednesday) dragged market lower while Expedia, Facebook and Expedia were seen positively.
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Economic data was stronger. The weekly jobless claims fell but weren’t quite as good as expected — the October monthly employment report due on 8 November is the key statistic here. The Chicago PMI was surprisingly strong, up to 65.9 from 55.7 and the highest since March 2011. But some discounted its relevance due to its divergence from other indicators.
Oil fell 0.54% to US$96.24.
Gold was down US$26.90 to US$1322.40 per ounce.
The US$ rose against most major currencies and the Aussie dollar was slightly weaker, trading near its overnight lows at US$0.9456.
VIX volatility index rose 0.73% to 13.75.
US treasuries were weaker — The 10 year yield rose two basis points to 2.558%.
European share were stronger — The UK FTSE was the exception, falling 0.68%, but the French CAC rose 0.60% and the German DAX was up 0.26%. This was despite disappointing employment data.
European bonds were generally stronger. The Spanish 10 year bond traded briefly under 4% for just the second time this year, and closed at 4.03%.
Base metal prices rose — Led by aluminium up 1.8% and lead up 1.2%. Copper, nickel and zinc were all up more than 0.5%.
Iron ore rose US$0.70 a tonne to US$131.90 a tonne.
- Bega Cheese (BGA) — Bega’s share price is likely to run after Fonterra purchased 6% of the company at $4.95. In a statement, Fonterra Chief Executive Theo Spierings said “There has recently been a lot of consolidation activity in the Australian dairy industry. It is important that Fonterra participates, and we have confidence in Bega and the strategy it is pursuing.” Yesterday Bega’s takeover play for Warrnambool Cheese and Butter Factory has been given a boost, with the competition regulator approving the bid.
- Macquarie (MQG) — Interim Result OK — Profit of $501 million, above an expected $500 million and up 39%. Operating income was up 2% to $3.7 billion. ROE 8.7%. $385 billion in assets under management at 30 September 2013. Subject to shareholder approval, Macquarie proposes to distribute to its shareholders one Sydney Airport stapled security for each Macquarie ordinary share held. First half 2014 EPS $1.50 up 42% on first half 2013. Interim dividend of 100c. It also reiterated that its 2014 financial year profit is expected to rise.
- David Jones (DJS) — First quarter 2014: total sales revenue was up 2.1% to $424.2 million. Like-for-like sales were down 0.35%. It was a slight increase in first quarter sales but the retailer has warned conditions are still challenging, especially for its electronics department. When disruption from the Canberra Centre store refurbishment was excluded, like for like sales rose 0.6%. Online sales increased by over 1,000% in the first quarter.
- NAB result yesterday was good. Slightly ahead of forecasts at $5.94 billion. See Stocktake for more details on the numbers but the key points were decent bad and doubtful debts and strong earnings across the group; even the UK business which has been an issue previously. Down a bit yesterday — said to be disappointment with the headline revenue growth number. Others talked of the APRA warning to limit dividends. But seriously? That is short term stuff which has nothing to do with the benefit of having some NAB in your retirement reserve. Some colleagues were selling yesterday but we think that’s a bit short-sighted.
- Specialty Fashion Group (SFG) — AGM – The women’s clothing retailer, whose brands include Millers and Katies, said sales are down as consumer confidence remains weak. First half profit will be weaker than the previous year’s $18 million.
- Boral (BLD) — was up 8.0 cents, or 1.65%, yesterday to $4.94. Building materials maker Boral says demand for its products was steady in the first few months of the financial year as housing construction picks up in NSW and Western Australia.
- Flight Centre (FLT) — Travel agency Flight Centre said at its AGM that it’s on track to lift its pre-tax profit after a promising start to the financial year.
- GUD Holdings (GUD) — AGM — down 44 cents, or 6.9%, yesterday to $5.93. The company behind Sunbeam appliances and the Dexion commercial storage business says earnings could fall in the current financial year.