The market is up 24 points.The Dow Jones was up 71 points to 15,822. The market recovered from initial falls and traded in 150 point range.

There was little in the way of news — the highlight was strong earnings from Macy’s. Volumes are quiet ahead of anticipated speeches by Federal Chairman Ben Bernanke and Vic chair Janet Yellen.

The S&P was up 14 to 1782.

Oil rose 0.56% to US$93.60.

Gold was up US$10.5 to US$1281.70 per ounce.

The US$ was lower against most major currencies and the Aussie dollar was a little stronger as a result, currently trading at US$0.9354.

VIX volatility index fell 2.57% to 12.49.

US treasury markets were strong — the yield on the 10 year bond fell 7 basis points to 2.710%.  There was a $24bn 10 year note auction and $16bn of 30 year bonds will follow on Thursday.

European shares were weaker — The UK FTSE fell 1.44% and other markets were weaker. UK employment data was strong and the Bank of England increased growth and inflation forecasts but Euro industrial production were weaker than expected.

European bonds were stronger. The Euro 10 year bond yield fell 5 3 basis points. The French and German 10 year yields both fell 5 basis points.

Base metal prices were mixed — copper was down 1.95% but nickel rose 0.33%

Iron ore was rose US$0.20 to US$136.10 a tonne.

STORIES

  • All eyes on Janet Yellen — Her nomination speech to the Senate Banking Committee has been pre-released and the opening comments talk about there being “more work to be done,” which suggests tapering will happen later rather than sooner. The US$ has dropped, the A$ jumped and the US equity market Futures have jumped.
  • Bega Cheese (BGA) — Has upped its offer to 1.5 BGA shares and $2.00 cash. That values their offer at $8.87. It also intends to declare the offer unconditional.
  • GrainCorp (GNC) — Full year profit of $140.9 million down 31%.
  • James Hardie (JHX) — First half profit more than doubled to $US194.1 million. Second quarter net operating profit was $US56.3 million which was above an expected $US48.6 million. Earnings rose to a US housing market rebound. First half net sales up 13% at $US764.2 million. It sees full year earnings at around $US180-195 million up from $140.8 million from the previous year. JHX says it will increase spending by $US100 million to add capacity in US. First half dividend of US8c. Management has said that although US housing activity has been improving for some time, market conditions remain somewhat uncertain and some input costs remain volatile.
  • Japanese GDP rose 0.5% in the September quarter, lower than 0.9% in the June quarter but above expectations of a 0.4% increase. The annual increase was 1.9% compared to the 1.7% expected.
  • Mirvac Group (MGR) — AGM.
  • CSR — Credit Suisse have raised their recommendation to Outperform from Neutral with a 290c target price up 32%.
  • The lack of developments from the Chinese Plenum being blamed for the fall in our market yesterday. No concrete details — just a pledge to let the markets play a more important role in the economy.
  • AGMs today from Bluescope Steel (BSL), Mirvac (MGR), Ramsay Healthcare (RHC), ResMed (RMD) and Sims Metal Management (SGM).
  • Gold up for once but only up $6 overnight.
  • Dividends ahead — Funtastic ex-dividend today. Orica ex-dividend on November 19. IPL on November 21 and DLX the next day.
  • Virgin Australia (VAH) — In trading halt. It has announced a $350 million capital raising via a rights issue. Air New Zealand confirms that it will be fully supporting the rights issue — it has a 22.9% stake which will rise to 25.99%.

Peter Fray

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