Australian Stock Market - Morning 11/3/2011
The Bank of England left its key lending rate unchanged at 0.50pct on Thursday. The central bank also made no changes to it´s £200 billion program of asset purchases. The result was in-line with expectations.
The US trade deficit widened from US$40.3 billion to US$46.3 billion in January - a five month high. Exports increased by 2.7pct in the month, while imports rose by 5.2pct. Capital good imports rose by 5.3pct while consumer good imports rose by 2.2 pct - highlighting the pickup in domestic demand. US initial jobless claims rose by a larger than expected 26,000 to 397,000 in the past week.
European shares fell to their lowest closing level this year on Thursday. Growing worries about the euro zone debt crisis rattled the market, after rating agency Moody´s cut Spain´s sovereign debt rating. Overall the FTSEurofirst index fell 1.1pct, the German Dax lost 1.0pct and the UK FTSE gave back 1.6pct.
US sharemarkets fell sharply on Thursday. Fresh unrest in Saudi Arabia coupled with the debt concerns emanating out of Europe kept investor nervous. The S&P 500 fell below its 50-day moving average for the first time since November. At the close of trade, the Dow Jones was lower by 228pts or 1.9pct. The S&P 500 fell 1.9pct and the Nasdaq was lower by 51pts or 1.9pct.
US treasuries rallied on Thursday (yields lower) as European debt concerns and further unrest in the Middle East supported debt prices. US 2yr yields fell 6pts to 0.64pct and US 10yr yields fell by 11pts to 3.37pct.
The Euro fell sharply against the US dollar as the cut to Spain´s credit rating kept euro zone debt problems in focus. The Euro fell from highs near US$1.3875, to around US$1.3775, and headed into the US close near US$1.3785. The Aussie dollar fell from highs of US100.55c to near US99.85c, heading into to the US close near US90.90c. And the Japanese yen eased from 82.70 yen per US dollar to around JPY83.15, heading into the US close near JPY82.95.
US crude oil prices fell on Thursday but were off their lows following reports of fresh unrest in OPEC producer Saudi Arabia. The weakness in Chinese trade data and strong US dollar was the key driver behind the early weakness. The Nymex crude oil contract fell by US$1.68 or 1.6pct to US$102.70 a barrel. And London Brent crude fell US51c to US$115.43 a barrel.
Base metal prices were mixed on the London Metal Exchange on Thursday. Copper ended lower for a second straight session after Chinese reported a $7.3 billion trade deficit - reflecting slower demand. And the gold price followed oil lower. Comex gold futures closed down US$17.10 an ounce at US$1,412.50.
Ahead: In Australia, no economic data is expected.
Myer Holdings releasing half year results.In the US, business inventories are released. Chinese economic data is released today.
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