The Australian sharemarket hit its lowest level since mid-March today; with the ASX 200 index (XJO) falling 1 pct or 44.1 pts to 4584.7 and the broader All Ordinaries index (XAO) dropping 1 pct or 46.7 pts to 4661.6. Aussie shares have now fallen for the fourth consecutive session.

Despite a positive start from the energy and mining sectors this morning, weakness from both market segments was one of the reasons the market fell so heavily today.

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The S&P/ASX 200 Materials index fell 0.73 pct or 96.7 pts to 13194.7. The world’s largest copper mine, Escondida which means ‘hidden’ in Spanish and is controlled by the world’s largest miner, BHP Billiton (BHP) experienced a 4.2 pct fall in its first quarter copper production. Thanks to higher copper prices however, its sales have jumped 7.4 pct between January and March this year. BHP shares fell 0.62 pct or 27 cents to $42.97 while the smaller RIO Tinto (RIO) dropped 0.37 pct or 29 cents to $78.72.

The S&P/ASX 200 Financials index was one of the worst performers after falling 1.04 pct or 45.1 pts to 4275.9. National Australia Bank (NAB) was the biggest drag on trade and lost 1.93 pct or 51 cents to $25.98, Commonwealth Bank of Australia (CBA) slumped by 1.79 pct or 91 cents to $50.01, Westpac (WBC) lost 0.55 pct or 12 cents to $21.72 and ANZ Banking Group (ANZ) eased by 0.46 pct or 10 cents to $21.70.

There has been concern recently from some in regards to the exposure that Australian banks have in troubled European nations. However, the exposure is a lot less than most people think. As an example, NAB is estimated to have less than 0.7 pct of its total assets invested in Portugal, Ireland, Italy, Greece and Spain which is a group of nations often called by the somewhat controversial acronym, PIIGS.

Online car classifieds website, Carsales.com (CRZ) announced an on-market share buy-back for up to 10 pct of its shares over the next 12 months. Based on yesterday’s closing price, this would cost the company close to $106 million. The buyback period kicks off on 9 June and does not need shareholder approval. CRZ shares jumped 1.96 pct or 9 cents to $4.69.

Although most sectors ended lower today, the retailers posted healthy gains throughout the day. Discount retailer, JB Hi-Fi (JBH) received a broker upgrade early in the day after the stock has fallen by 11 pct throughout the month of May. JBH rose 1.94 pct or 32 cents to $16.85. Australia’s largest department stores did even better with Myer (MYR) jumping 3.58 pct or 10 cents to $2.89 while its competitor David Jones (DJS) rose 2.35 pct or 10 cents to $4.35.

One of the world’s largest owners of shopping centres, Westfield (WDC) held its Annual General Meeting (AGM) today at the Sydney Town Hall starting at 10am (AEST) this morning. The company reaffirmed its previous earnings guidance of $1.7 billion for the 2011 full year. WDC shares ended better than most by falling a modest 0.22 pct or 2 cents to $9.01.

Australia’s largest airline, Qantas (QAN) ended 0.95 pct or 2 cents lower to $2.09 after a warning that its pilots could be preparing to take industrial action against Australia’s oldest airline for the first time since the mid 1960s.

According to the BRW Rich 200 list, Gina Rinehart is the richest person in Australia with her net wealth estimated at AU$10 billion. Gina Rinehart became the country’s first female billionaire back in 2006. She is the daughter of the late mining magnate Lang Hancock, who famously discovered the world’s largest iron ore deposit in the Pilbara region of Western Australia in 1952.

The Hancock Group was founded by her father and is the holder of a number of iron ore leases in the Pilbara region and covers as much as 500 square km.

On the economic front, the Australian Bureau of Statistics (ABS) released numbers on construction work for the previous quarter. There was a 0.7 pct improvement in the amount of construction work done across the country in the March quarter (January to March 2011). Most of the gains came from engineering work done which rose by 4.6 pct, while commercial building slumped 10.2 pct over the same period.

Commsec Economist, Savanth Sebastian said that “The lift in construction activity was certainly a welcome result, despite the modest nature of the rise. It was especially pleasing given that it was solely driven by the private sector, and in an environment that was disastrously affected by wet weather. Certainly states on the eastern seaboard fared worst with Queensland and NSW both seeing a drop-off in construction activity but the smaller states and territories experienced stronger activity.”

In relation to interest rates, Mr Sebastian said that “The one area that will be closely watched by the Reserve Bank is the demand for labour and resources. So far the data suggests otherwise with wage inflation well contained while the strength in engineering is being offset by the lack of commercial building – reducing the demand on labour and materials costs.”

Tomorrow at around 11.30am (AEST), the ABS will release its latest reading on private capital expenditure for the March quarter. This specifically measures the change in the dollar value of new capital spending in the private sector.

Out of Asia today, Japan’s Ministry of Finance released its latest monthly trade balance reading for April. Although Japan did post yet another trade deficit, it was better than expected. Exports fell 5.5 pct while imports rose by 3.8 pct. This measures the different in value between imported and exported goods for the month.

The world’s largest commodities trader, Glencore listed on the Hong Kong Stock Exchange today. This is a few days after the listing on the London Stock Exchange last week.

In Europe overnight, German and British sharemarkets managed to rise slightly after falling by close to 2 pct on Monday night. As expected, Germany’s economy rose 1.5 pct last quarter.

Tonight, the U.K will be releasing its revised GDP figures at 6.30pm (AEST). Italy will also publish its latest retail sales numbers which the market is expecting to have fallen by 0.1 pct. Consumers in Italy have remained very conservative and cautious when it comes to parting with their cash.

Last night in the U.S, shares fell for the third consecutive session and American markets have now ended lower for 7 of the last 10 sessions. The number of new homes sold in the U.S rose by 7.3 pct in April to 323,000 homes (annualised figures).

It is important to note that the number of homes sold over the past few months has been lower than what the market was expecting. The number of new homes sold is usually quite volatile and bounces around from month to month.

The data was published in a short 6 page report which was mostly made up of tables and shows the number of houses sold in addition to the prices they were sold at.

In April, 73 pct of all homes sold in the U.S went for less than $300,000 with only 7 pct of all new homes sold fetching more than $500,000 which is in stark contrast to Australian property sales.

Tonight in the U.S, data will be released on durable goods orders. This measures the change in the dollar value of new orders placed with manufacturers for durable goods.

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A durable good is a product that does not wear out quickly, such as refrigerators, cars, toys and furniture. At around 12.30am (AEST), the Energy Information Administration (EIA) will release its weekly data on crude oil inventories. This shows the change in the number of barrels of crude oil held in inventory in the U.S.

Volume of shares traded came in at 2.49 billion today, worth $5.63 billion. 359 shares were up, 750 finished weaker and 382 ended unchanged.

At 4.30pm AEST on the Sydney Futures Exchange, the ASX24 futures contract is down 0.89 pct or 41 pts to 4589.

Most major European markets trade between 5pm (AEST) and 1.30am (AEST) futures are currently indicating a weaker start to trade.

Dow Jones futures are pointing to a lower start to trade when American markets open at 11.30pm (AEST) tonight.

Turning to currencies, the Australian dollar is weaker and buys US104.6 cents, JPY85.75 and EUR74.58 cents. Despite the recent fall in the Australian dollar (AUD), it is important to remember that the AUD has gained more than 20 pct against the US dollar over the past 12 months.

The best performing stock on the market today ended up being Acclaim Exploration (AEX), which rose 66.67 pct or 0.2 cents to 0.5 cent today. AEX is a mineral explorer based in Perth.

Have a wonderful evening.

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