[R]7:00PM New York, 11:00AM Sydney – Caltex Australia plunged on the lowered outlook on refining margins in 2008. Sims Group net profit fell 9.5% but consolidated profit at Wesfarmers surged 53.3% on Coles acquisition.[/R]

Market Sentiment

ASX 200 index fell 0.4% or 23.5 to close at 5,559.90

The Preliminary market turnover was 2.01 billion shares worth $6.39 billion, with 551 stocks moving up, 625 moving down, and 346 unchanged.

Market Driver

Wesfarmers, which acquired Coles last year, posted first half earnings rose by 53.3%. Net profit for the half-year ending in December was a record $601 million, up from $392 million in the prior corresponding period.

The consolidated total revenue rose 107.9% to $9.81 billion. The consolidated result for the first time included Coles, acquired in November, and reflected strong sales in the Coles businesses over Christmas.

Coles contributed $357 million in earnings before interest and tax. Wesfarmers declared an interim dividend of 65 cents. Wesfarmers share gained 6.8%.

Gainers and losers

Of the ASX 200 index stocks, AED Oil Limited led the gainers with a rise of 18.4% followed by increases in Minara Resources of 8.6%, in Arrow Energy Limited of 7.3%, in Zinifex Limited of 7.3%, and in Harvey Norman of 6.8%.

Of the ASX 200 index stocks, Caltex Australia Limited led the decliners with a fall of 10.8% followed by losses in Austar United of 5.7%, in DB RREEF Trust of 5.5%, in Coeur D''alen of 5.5% and in City Pacific Ltd of 4.8%.

Chinese steelmakers reject Rio''s demand

The largest buyers of iron ore, Chinese steelmakers, today indicated that it would reject Rio Tinto Group''s demand for a minimum 71% increase in the raw material.

Two people familiar with the negotiations, who declined to be named, disclosed the deadlock in negotiations as reported on Bloomberg news service. The people indicated that the steelmakers could only accept a 65% price increase.

Rio Tinto rose 1.4%.

Caltex share falls 11% after lower profit forecast

The nation''s biggest oil refiner, Caltex Australia Ltd''s share fell 11%, the most in six years, after forecasting lower profits from processing crude oil this year.

The company also indicated that it cut its second-half dividend, citing rising operating costs and squeezed refining margins and they may decline on the rising dollar. The company reported full-year profit within a December forecast range.

Australian oil companies have spent record $34 billion on minerals and energy projects to boost output to meet soaring demand.

Sims post $102.2 million in net profit