The market is up 36. The SFE Futures were up 46 this morning.

The Dow closed up 161 and was up 163 at best as it rebounded from its worst week this year on upbeat economic comments from Ben Bernanke and suggestions that QE3 is still on the cards if required. European markets were higher. The gold price was up another $23.20 to $1685.60 after its $19.90 gain a day earlier. Metals were mostly higher on the LME. The oil price was up 16¢ to $107.03. All ten S&P 500 sectors were higher with Healthcare stocks the best, up 1.75%. Consumer discretionary, Financials and tech stocks also outperformed. The Aussie dollar was up buying 105.33¢.

Main points:

  • Nufarm (NUF) delivered an interim of $18m which was below an expected $24m. This included one off items of $5.9m. Operating profit was $23.9m. Fully franked interim dividend of 3c. Highlights for the period were the strong performance of the company’s operations in Australia and Brazil where positive seasonal conditions drove stronger demand for crop protection products. The European business was tracking behind budget and faced some challenges over the year. NUF is confident that they will generate an improved operating profit outcome for the full year.
  • Stockland Group (SGP) has delivered a profit warning cutting its full year earnings guidance due to recent interest rate rises and weak property sales. SGP sales have continued to fall after banks lifted their interest rates in Feb despite the RBA keeping the cash rate on hold. Wet weather has also delayed production. SGP has lowered its forecast for EPS by 3.5%, now expecting EPS to be 30.5c down from 31.6c. The company has said the housing recovery is likely to be slow unless there is a reduction in interest rates to improve affordability and buyer confidence.
  • Beach Energy (BPT) has announced it is undertaking a $345m capital raising consisting of an entitlement offer and an unsecured convertible notes offer. The proceeds will be used together with existing operating cash flow to fund BPT’s future capital expenditure initiatives over the next two-three years. BPT is in trading halt.
  • The QLD government is planning to sell its remaining $3bn stake in QR National (QRN) to help pay off debt. This deal could be one of the biggest capital market deals of the year. QRN announced a profit warning yesterday and is expecting earnings to be between $540m-$580m compared to its previous guidance of $578m. This revised guidance is due to factors including strike action and wet weather.
  • Origin Energy (ORG) and Santos (STO) could be hit with a $1bn bill to compensate QLD farmers and landowners for loss of production due coal seam gas operations. QLD has three major projects under construction in Gladstone which include the QGC project, Gladstone LNG development and the APLNG facility.
  • The MT Preferred Stock Portfolio is published in the newsletter today. It was first published on October 28 2011. In five months the average performance of the 28 stocks on the list is up 12.4% each against the market down 2.1%. When you consider that fund managers write marketing copy and get excited about a percent of outperformance the Preferred Stocks list has delivered a truly remarkable performance and it is a testament to the thesis that making money is about picking stocks not investing in “the market”. The stocks were picked on a value/quality basis and when you stand back and ask what’s really gone on here you’ll realise that their outperformance is probably because the overall tone of the market is still one of cautious risk aversion in which case “quality” rather than “growth” and “risk” has been targeted. That can change but it’s certainly working at the moment. To read more sign up for a free trial at www.marcustoday.com.au.

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