Market down 27, financials down 1.7% and resources up 0.9% with oil hitting all time inter-day record and closing $3.65 at $119per barrel. SFE Futures predicted a 3 point fall in the market this morning.

Dow down 88. It was down 118 at its low. Down all day. Volume on the NYSE was the lowest this year. UK market was closed. France and Germany up 0.13%. Main issue was a 15.0% fall in Yahoo!in response to Microsoft withdrawing its bid at the weekend. No rate cuts– a new high on the oil price highlighted the inflation issue and suggests the Fed will not be cutting rates again in a hurry. Profit takingafter an 11.2% bounce in the Dow Jones since March 17th. The Dow is now just 7.8% off last years record high.

It was down 17.1% at its worst. Financials down 1.5% with comments that the sector has been overbought in the rally. Materials (resources) up 1.5% with Energy up 1.0%. Countrywide Financial down 10.37%to $5.36 on analyst talk that the company was worth zero to $2 and that the Bank of America should withdraw or lower its $7 bid made in January. Bank of America down 2.06%. Ambac Financial (bond insurer) down 8.92%on comments from Warren Buffett that some bond insurers don't deserve their AAA rating. Inflation concerns returnafter the Oil price hit a new record of $120.21. As the market falls all the bear market pattern returns. Some pertinent comments made overnight - Merrill Lynch said the market was going into a "long soft patch". Greenspan spoketo Bloomberg News and labeled the US economy as being in a recession but an "awfully pale recession."

Both BHP and RIO up in ADR form overnight, 1.11% and 3.97% respectively. BHP up 53c to 4465c. RIO up 148c to 14043c. Metals unchanged – London closed for Bank Holiday. Zinifex up 7c to 998c.

Oil price closed in record territory - up $3.58 to $119.94 – on the back of overseas supply concerns and a weaker US dollar. Woodside up 93c to 6015c. Gold up $16.10 to $874.10. Newcrest up 93c to 2923c. US Bonds down with the 10 year yield up to 3.86%.