**23/09/10 - 8.10am - by James Gerrish**
US stocks slipped marginally overnight led by a drop in Microsoft after the company tapped the bond market for $4.75 bn. Financial stocks continued to fall following the trend from Tuesdays session with JP Morgan and Bank of America off 1.6% and 1.7% respectively.
It seemed like there was some lingering concern about the Fed Statement on Tuesday that the US economy is still likely to need further stimulus. This cast a shadow over some growth assets - Oil was the standout down more than 50c again overnight. It's actually quite interesting to see the energy stocks on the local market rising yesterday despite a negative session in the Crude market. To me, this positive price action in stocks which conflicts with what we're seeing in the actual commodity could be telling us something - maybe some possible corporate activity in the sector.
At the end of last week, we suggested a number of stocks in the energy sector that we found interesting. Origin Energy (ORG) was one of these and this has now broken the $16 resistance area. We rate this as a BUY. (See full research report attached). Oil search (OSH) was also mentioned on consolidation above $6.00. This is occurring and we maintain a BUY on this stock. Woodside Petroleum (WPL) was the other stock in this sector and although it has failed to close above $44, which was our trigger point, we continue to monitor.
We also suggested ASX (ASX) on a break of $30.70. This has played out and the stock is looking quite attractive
In overseas markets last night, the DOW JONES lost -21 points or -0.25 to close at 10739. The FTSE 100 fell -24 points or -0.44% to close at 5551. Locally, SPI Futures are indicating a drop of 14 points on the open.
Looking across the commodity space last night, we actually saw all base metals higher led by solid gains in Copper +2.2%, Lead +2.24% & Aluminium +2.82% - Driven by a weaker USD. Precious Metals were all positive including Gold which edged ever closer to $1300 - settling at $1290.80. This is likely to offer a positive lead for the material stocks on the local market this morning. In London, RIO rose 82.2 pence suggesting a rise of $1.35 in Aussie Currency terms. BHP was 41 pence higher suggesting a rise of 67c locally.
EQUITY OPTIONS Expiry Today
