Mixed earnings reports and hawkish RBA rhetoric fueled further gains (1.0% in the S&P/ASX 200 index) in ASX stocks this market week. Market movers included:

Wesfarmers Ltd (WES) reported food and liquor sales at its Coles unit up 7.3% in the quarter but cautioned consumers remain wary of rising petrol costs and interest rates. WES gained 2.34 in the week, opening at 25.92, closing at 28.26.

Commonwealth Bank (CBA) gained with the general banking sector. CBA gained 1.24 in the week, opening at 55.00, closing at 56.24.

BHP Billiton (BHP) issued its quarterly production update, with copper declining, zinc rising, and iron ore rising to a record 30.1M tonnes. Company representative said China seemed to have completed its stockpiling of commodities. However, demand appeared to be recovering in developed economies. BHP gained 0.77 in the week, opening at 72.20, closing at 72.97.

Newcrest Mining (NCM) reported a decline of 5% in gold output September, due to mining lower quality ores, but did not expect that to influence output. NCM lost 0.12, opening at 35.59, closing at 35.47.

Fortescue Metals Group (FMG) announced plans to nearly double its iron ore output to 95 million tonnes by 2012 and to possibly blend its ore with that of Vale SA of Brazil, to better suit China’s steel mills. The market was not impressed, and FMG lost 0.13 in the week, opening at 4.16, closing at 4.03.

Santos Ltd (STO) reported 3Q2009 revenue of $557M, a decline of 24% y/y although production rose 5% and the company confirmed 2009 output. STO lost 0.24 in the week, opening at 15.79, closing at 15.55.

Woolworths (WOW) reported increased sales of $13.4Bn in the quarter but issued cautious guidance. WOW lost 0.64 in the week, opening at 29.75, closing at 29.31.

Woodside Petroleum (WPL) confirmed its plan to expand its Pluto project despite two potential suppliers opting to feed their LNG to the competition, Chevron Corp. Earnings in 3Q2009 fell to $1.06Bn, −40% y/y, and production decreased 5% to 20.6M barrel equivalents. WPL lost 0.75 in the week, opening at 52.55, closing at 51.80.

Earnings season gets heavy next trading week, including results from BEN, TCL, BLD, DXS, MMG, WOR, CLO, and others—26 announcements in all. Investors are showing signs of unease with earnings gains based on cost cutting, rather than higher revenue. Any company reporting increased sales can expect a boost in share price, and very few excuses are being accepted.

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