**26/08/10 - 8.20am - by James Gerrish**
We saw some solid declines across the board on our market yesterday with the banks really taking the brunt of selling. We're now seeing this sector trade near the bottom of its trading range and we'll be looking for buyers to step in to offer support. See the chart of the Financial sector. Individually, Westpac has key support around $20.50, CBA should see some buying around $47, NAB's
trading range has a base around $22.50 and our Number 1 pick in the banks,
ANZ - which has been outperforming - is trading well above its key support level of around $20.50. We may see some type of recovery in the sector today however I don't think the market will get too carried away.
Overnight, the
DOW JONES added +19 points or +0.20% to close at 1060. The session was actually more positive than that number would have you believe with the index finishing +123 points from its session lows - so this suggests some buying support into the recent weakness.
In the UK, the FTSE 100 lost -46 points or -0.9% to 5109.
Locally, the SPI FUTURES contract was pricing in a modest rise of 15 points when the market opens this morning.
Last night we saw economic data continue to miss expectations, this time durable goods orders was a disappointment. Durable goods refers to large items that do not quickly wear out - examples would include appliances, cars, furnishings etc. This has generally been an area of the economy that has held up well however last nights figure was weak - continuing the weak macro environment.
BHP released its results yesterday which came in broadly inline with expectations highlighting its strong financial position and the impact of higher base metal prices. We remain positive on BHP despite the near term weakness and feel that level <$36 would be attractive.
Woolworths have just released results that were pretty much in line however they declared a dividend of 62c when the market was looking for 66c. There is likely to be some weakness here early but they did announce a 700m share buy back which should offer some support. I'm not a fan of the stocks at this stage.
