Australian shares are slipping at lunch, with the ASX 200 Index down 0.7 per cent following weaker commodity prices and the biggest tumble since early January in the US overnight. The ASX 200 was down by more than 1.2 per cent earlier in the day. IN PHOTO
Australian shares are slipping at lunch, with the ASX 200 Index down 0.7 per cent following weaker commodity prices and the biggest tumble since early January in the US overnight. The ASX 200 was down by more than 1.2 per cent earlier in the day. IN PHOTO: Australian shares are slipping for the third time this week with the ASX 200 Index down 0.4 per cent at lunch. Revisions to China’s growth targets for the year ahead has been a drag on the mining sector in early trade. A television journalist looks at a display board shortly after the local market opened at the Australian Stock Exchange in Sydney August 5, 2011. Australian stocks sank over 4 percent in opening trade on Friday, after worries about European sovereign debt and weakness in the U.S. economy hammered stock markets from Europe to Wall Street. Reuters/Tim Wimborne
  • The Australian sharemarket has kicked off the holiday shortened trading week a little firmer with the ASX 200 Index up 0.5 per cent. This adds to last week’s 3.6 per cent surge; which was the best week in three years for local stocks.
  • Energy and mining stocks were the lone losers after both performed best last week. Over the previous five sessions energy stocks surged by 3.5 per cent while the miners gained 6 per cent. A 1 per cent fall in the oil price to a near six-year low overnight and a 4 per cent slide in the iron ore price weighed these industries down today.
  • Lynas (LYC) slumped 19.3 per cent despite posting its first month of positive cash flow in December. The rare earth minerals producer does not expect cash flow to be sustained due to weaker mineral prices, restructuring costs and China’s stranglehold on the industry.
  • A number of quarterly production reports will be released this week including Fortescue Metals (FMG), Newcrest Mining (NCM), Origin Energy (ORG), OZ Minerals (OZL) and BC Iron (BCI).
  • Qantas Airways (QAN) rose by 1.7 per cent. The airline announced cuts to its fuel surcharges on international flights today however this is not expected to reduce fares. QAN said it would lift base fares by the same margin. The airline’s largest shareholder – Franklin
Resources has cut its stake in QAN for the third time in two months. QAN shares have surged by 120 per cent over the past 12 months.
  • Telstra (TLS) share surged by 1.6 per cent and remain around 14.5 year highs. TLS’s dividend yield remains around 4.6 per cent.
  • Volume was significant today with 1.83bn shares traded worth $5.5bn. 441 stocks rose, 478 fell and 361 stocks finished unchanged.
  • The results of NAB’s monthly business confidence survey were released today. While business conditions worsened slightly, business confidence improved. The ANZ - Roy Morgan weekly consumer confidence survey results are delayed and will be released on Wednesday. The average unleaded petrol price fell by 4.7c/l last week to 111c/l; a six year low. The average household is saving around $52 per month on petrol compared to 12 months ago.
  • Tonight will be the busiest night of the week in the US with a barrage of economic readings due for release. The US central bank’s two day meeting on monetary policy kicks off tonight with the market focused on any clarity around rate moves. A report on durable goods orders, consumer confidence and home prices will also be in focus.
  • The quarterly US earnings season continues tonight with Apple, Yahoo!, Caterpillar, AT&T, 3M, Pfizer, Proctor & Gamble and DuPont all posting results overnight. The Australian dollar remains near a five and a half year low against the greenback and buys US$0.791. Tomorrow’s December quarterly CPI (inflation) will be important for currencies and the market’s interest rate move pricing. A weaker than expected CPI result could boost the market’s expectations of a rate cut in coming months. The market currently is pricing in a 28 per cent chance of a rate cut next month.