world summary: wall st still in the clouds takes b

World Summary: WALL ST STILL IN THE CLOUDS TAKES BREATHER
07:52, Friday, 20 October 2006

Sydney - Friday - October 20: (RWE Aust Business News) - Wall
Street's Dow re-crossed the magic 12,000 barrier overnight but investors
believed they had done enough for one session and then took a breather.

In any case, key New York indices finished in front with the Dow
up 19 points, the S&P 500 1, the Nasdaq composite 4 and the 100 index 6.

Financial markets were unsettled after oil jumped almost a dollar
to $58.50 barrel for November crude, in reaction to OPEC moving to trim
output for the first time since 2004.

Saudi Arabian Oil Minister Ali al-Naimi, OPEC's most influential
voice, said he supported the 1 million barrel cut and the group could
reduce output even further at its next meeting in Nigeria on December 14.

Economists suggest the latest data, combined with a drop in
weekly jobless claims, point to a growing economy but at a slower pace.

It supports a steady interest rate by the Fed at its next FOMC
meeting later this month.

Meanwhile, the Philly report still had a sting in its tail after
disclosing the US mid-Atlantic region manufacturing slipped for a second
month in October.

The Philadelphia Federal Reserve Bank said its business activity
index fell to -0.7 in October from -0.4 in September.

However, a gauge of future economic activity rose in September
for the first time in three months, offering a mixed outlook for the
economy.

The new orders component of the index rebounded to 13.4 in
October from -1.3 in September.

On other data, the initial state insurance benefits claims fell
10,000 last week to 299,000 from a revised 309,000.

The level was below market forecasts of a rise to 312,000 new
claims.

Meanwhile the Conference Board, reported its Index of Leading
Economic Indicators gained 0.1pc in September to 137.7 after falling
0.2pc in August.

Analysts had forecast a slightly stronger rise.

Treasuries traders marked down 10-year cash paper, lifting the
yield 3 points to 4.78pc.

In the market Citigroup's net income fell 23pc, as the firm was
hurt by lower-than-expected results from its capital-markets businesses.
Revenue was flat.

Pfizer cut its revenue outlook for 2007 and 2008 and its new CEO
signaled more cost-cutting moves. Lilly's profit increased 10pc, while
Wyeth reported a 33pc rise in net income. Novartis posted a 13pc rise in
net.

Apple posted a 27pc rise in net on strong sales of iPods and
computers, but said results were preliminary and might be adjusted.
Sony slashed its profit targets, on battery recalls and game spending.


WALL STREET... The Dow Jones industrial average index settled
19.05 points higher at 12,011.73. The Standard and Poor's 500 index
edged up 0.94 points to 1366.90. The Nasdaq Composite rose 3.79 points to
2340.94 and the 100 index added 5.62 points to 1706.37 on the close.
Treasuries retreated. The 10-year note fell 7/32 ticks to 100 24/32,
lifting the yield 3 point to 4.78pc. The 30-year bond yield added 2 point
to 4.91pc while the 2-year note yield also rose 2 point to 4.87pc.


US DOLLAR... has weakened against most major currencies. It is
trading at 118.19 yen from around 118.93 previously in New York. The euro
is $US1.2625 against $1.2532 while sterling is $US1.8777 compared with
1.8673 previously. On the Swiss franc, the US dollar is trading at
1.25735 from 1.2709 previously.


AUSTRALIAN DOLLAR... has traded firmer. The $A is currently
trading at US75.89c compared with yesterday's local close of US75.60c. It
failed to break US76c, trading as high as US75.99c and as low as
US75.54c. The Aussie on the crosses is worth 89.70 yen (pre 89.73),
0.6011 euros (pre 0.6021 and 40.42 pence on sterling (pre 40.41).


AUSTRALIAN MARKET... could rebound, with the December futures
contract up 22 points to 5223 and higher metal and oil prices. The ASX
200 index finished 27.9 points weaker at 5285.3 yesterday. Today's annual
general meeting agenda includes Rural Press, PaperlinX, Albidon, Western
Areas and News Corp tonight in New York. Beacon Mining will list on the
ASX while HomeLeisure is ex dividend. The ABS will report September
quarter trade prices indexes and the September motor vehicle sales.


EUROPEAN SHAREMARKETS... finished subdued and unsettled overnight
with major markets barely moving. On the Continent investors showed
concern about earnings and sales from Kokia, SAP and Nestle although
Ericsson improved. Mining stocks held up, reducing selling pressure.
Shares of Xstrata rose, supported by stronger gold and copper prices.

At the close, the UK FTSE-100 Index rose 5.6 points to 6156.00
but the French CAC-40 Index eased 1.55 to 5359.74 while the German DAX
Xetra index slipped 5.36 points to 6177.42 and Zurich crept up less than
half a point to 8620.68. Other markets also showed little movement.
Amsterdam added 0.25 of a point, Brussels was down 7, Milan off 2 but
Madrid General gained 7 and Oslo ended 3 in front.

Technology stocks were mixed, led by mobile phone company Nokia
which closed down in Helsinki as third-quarter profit fell 4pc to 845
million euros, due to sharper-than-forecast decline in average selling
prices for its handsets. In contrast, Ericsson, the world's largest maker
of mobile-phone networks, saw its shares improve after third-quarter net
profit rose 17pc to 6.2 billion Swedish krona on strong growth at its
handset joint venture and a gain from the sale of defense units.

In Frankfurt, shares of SAP fell 3.1pc and chip maker Infineon
Technologies lost 2.2pc. SAP reported a cautious outlook after disclosing
a 16pc profit increase for the third quarter. Infineon's weakness could
partly be traced to US chip maker Advanced Micro Devices, which late
Wednesday surprised the market by reporting lower profit margins and
average selling prices for its chips. Vehicle makers such as BMW,
Volkswagen and French-based Renault all gained sharply as oil prices
stayed near weekly lows.

In Paris, French IT services group Atos Origin, gained 10.4pc
after a report suggested that private-equity group Blackstone is in talks
to buy the company for between 3.4 billion and 3.6 billion pounds, or
between 51 to 54 pounds a share.

Reports from London suggested that friendly talks started nearly
four weeks ago. Food company Danone finished lower.

In Zurich, Switzerland's Logitech closed sharply higher after
raising its sales and profit outlook following strong results. Nestle
dropped 3.1pc after a recent strong performance and as the company failed
to update on its share buyback plan. The food group reported nine-month
sales rose 9.1pc to 72.2 billion. Shares of drug maker Novartis rose
1.1pc reported a 12pc rise in third-quarter profit on the back of sales
of drugs to treat hypertension and leukemia and lower-than-forecast
taxes.

In Amsterdam, shares of Dutch pharmaceutical and chemical company
Akzo Nobel gained after news the company plans to reduce its cost base in
mature markets by 100 million euros.



METALS... firmer. COMEX October gold spot month contract rose
$10.10 to $599.00 oz while the active December contract gained $9.90 oz
to $602.50 oz. October silver jumped 34.2c to $12.085 oz. October
platinum added $1.70 to $1091.30 oz while spot copper (Oct) improved
1.75c to 348.85c lb in New York.

Three months closing LME bid prices were copper $7680 tonne,
tin $9800, lead $1495, zinc $3940, aluminium $2737 and nickel $31,650
tonne.

Earlier, on the three months official bid prices, copper slipped
$10 to $7610 tonne but tin gained $175 to $9825 while lead added $20 to
$1500. Zinc rose $85 to $3945 while aluminium rose $35 to $2727 and
nickel ended $890 higher at $31,290 tonne.



OIL... settled 85c higher at $58.50 barrel for the spot price
based on the November contract on the New York Mercantile Exchange
showing a high of $58.95 and low $57.45 barrel. The December crude
contract gained $1.20 to $60.50 barrel with a high of $61.00 and low
$59.20 barrel. The Brent ICE November crude futures climbed $1.44 to
$61.02 barrel with a high of $61.25 and low $59.31 barrel.


The CRB index rose 3.45 points to 307.97.



ENDS