The market is down 37 — down 54 at worst, in-line with the 45 point fall predicted by the SFE Futures this morning. Resources down 0.5% — BHP and RIO down 0.1% and 1.0% respectively. BHP said it was better placed than its peers to weather the downturn but would make production cuts if necessary. Property underperforming – down 1.3% with Stockland down another 2.3% after yesterday’s writedowns. Industrials down 0.4% – Telstra up 1.1% as it sends a letter to shareholders regarding the Government’s rejection of TLS participating in the NBN process and said as a company they would move on. Orica down 5.7% on a downgrade from UBS.

The Dow was down 99. Up 37 at best. Down 146 at worst. Sold off hard in the final half hour. Sectors mixed. The Russell 2000 of small stocks outperformed — up 0.8%. Market digests the 75-100bp cut by the Fed — bit of a fall expected after the 5% gains yesterday. Morgan and Stanley posted a larger-than-expected loss for the 4Q. Citigroup down the most among financials on reports of more oversight by regulators. Large cap technology stocks perform the worst — down 1.7%. Financials down 1.3%. Defensive retailers outperformed. OPEC aiming at cutting production much more than expected — oil still fell as the US dollar falls the most against the Euro since its float in 1999 — oil down 8.4% to $40.17. Government bonds higher on fears surrounding all other riskier investments. BHP up 0.8% in ADR form and RIO down 1.85%. Metals mostly up overnight. Gold up $25.80 to $868.50.

Domestic financials down 1.8 % — CBA came out of its trading halt 11% lower at 2500c — actually went ahead and raised $2bn at a 10.8% discount at $26.00 per share, underwritten by UBS after their failed $2bn institutional raising yesterday with Merrills. It announced impairment charges of around $2.5bn (which includes $365m write-off on ABC Learning), more than consensus estimates of $2.02bn. It says charges are mostly in the 1H of 2009.

  • National Australia Bank (NAB) will combine Australia and group CEO roles. Incoming CEO Cameron Clyne says he wants to be closer to customers and employees.
  • Caltex Australia (CTX) has upped its 2008 FY profit forecasts — now expects a profit in the range of $135-$155m, up from the previous forecast of $115-$145m.
  • Ten Network (TEN) has held its AGM — it is undertaking a cost review and says 1Q 2009 EBITDA is down 25.2% to $91.6m. Long term contracts are in place but expects challenging operating conditions in 2009.
  • Babcock & Brown Wind (BBW) has terminated its management agreement with Babcock & Brown (BNB) for a total cash payment of $40m.
  • CFS Retail Property (CFX) has revalued 12 assets down $99.2m.
  • ING Industrial Fund (IIF) has suspended its distribution reinvestment plan.
  • Invocare (IVC) have made some management changes.
  • No distribution for security holders of Centro Retail (CER) for the half year to Dec 31.
  • Babcock & Brown Infrastructure Group (BBI) said its B&B WA Rail Holdings subsidiary has agreed to extend a $66m debt repayment until March 2009 with its lenders. It was due December 15.
  • Downer EDI (DOW) has won contracts totaling more than $350m.

Broker Stuff today…

  • Citi cut their target price on Stockland (SGP) to 389c from 434c despite maintaining their HOLD recommendation saying the stock is trading on a “fairly attractive FY10e” yield of 9.1%, although earnings are at risk after yesterdays $105m in writedowns.
  • GSJB Were maintain their HOLD recommendation on Westpac Bank (WBC) and maintain their 1944c target price after WBC provided an update on merger integration with SGB. They say its early days but at this stage the merger appears to be performing well in terms of customer retention and cost synergies.
  • Credit Suisse upped their recommendation on AED Oil (AED) to Neutral from Underperform due to recent share price depreciation. They have a 155c target price.

Other Stuff…

  • The number of people in the UK claiming unemployment benefits has reached 1m for the first time in 8 years after increasing at the fastest rate since 1991.
  • Futuris down to share price levels not seen since 1992 on no announcements.
  • The Dow Futures suggest a 2 point fall on Wall Street tonight.

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