Australian Stock Market Report – Afternoon January 15, 2015

A screen displays news on the Dow Jones Industrial Average just after the opening bell on the floor of the New York Stock Exchange October 15, 2014. U.S. stocks opened sharply lower on Wednesday as economic data reinforced concerns about the health of the world economy and that corporate merger activity may be slowing. REUTERS/Brendan McDermid (UNITED STATES - Tags: BUSINESS)

Losses continue on the ASX for a fourth day.

Local shares extended this week's losses, with the market again held back by heavy falls in the materials sector. A weak lead from Wall Street also weighed on investor sentiment. Overnight markets sold off on weak metal prices, US retail sales for December coming in weaker than expected and poor earnings results from large cap banking stocks.

Here in Australia the market did recover from the day's lows, following the release of much better than expected December employment data. The ASX 200 (XJO) slipped 0.4% or 22 points to 5,331.4 points. In a surprise to economists and market analysts, employment rose by 37,400 in December to record highs.

Consensus forecast was for a 5,000 lift in jobs in December. Full-time jobs rose by 41,600 in December, while part-time jobs fell by 4,100. Annual jobs growth stands at a 43-month high of 1.9%. The Australian unemployment rate now stands at 6.1% falling from a revised 6.2% rate.

The Materials sector was again the worst performer - dipping by XX percent on the back of weaker commodity prices. BHP Billiton (BHP) fell 1.1%, while Rio Tinto (RIO) fell 2.45% The biggest slides once again today were in the copper sub sector with Sandfire Resources NL (SFR) off 7.4% and PanAust Limited (PNA) off 3.07% and OZ Minerals Limited (OZL) down 4.3% after the London metal exchange (LME) copper price closed down 5.4%.

Mineral sands miner Iluka Resources Limited (ILU) released its quarterly production report today, the company said it production was strong but prices had fallen and this cut is full year revenue. Iluka also told the market it has seen no substantial sign of recovering demand for its products. ILU closed the day down 2.48%

After a shocking two months for the oil markets today the oil price rallied, up 6% in US trade to back above US$48 a barrel the move had more to do with options and contract expiry than demand for energy products so we did not see too much of a reaction on the ASX today. The main focus for investors in that sector today was Woodside's quarterly results. Woodside Petroleum Limited (WPL) shares fell on news of lower sales in the last quarter and a lack for strong guidance or future planning. WPL said it expects FY15 production to be in the 84-91mmboe range which represents a decline of 4-12% on FY14 production. Woodside management said today that they would update the market in February on its plans to adjust spending and future cash flows.

Woodside reports its earnings numbers on the 18th of February 2015 Oroton (ORL) shares plunged 23.38%, after the fashion and accessories retailer issued a profit warning. Oroton's underlying H1 earnings is set to fall by between $2.5 million and $3.5 million, from $8 million in the same period a year ago. The firm said that although sales have picked up in the past three months, it's not enough to offset lower earnings in the previous three months.

In other economic news, dwelling starts lifted to record highs in the September quarter and in the year to September. Starts rose by 12.5% in the quarter. Houses rose by 0.8% and apartments rose by 31.3 %. Work started on a record 192,636 new dwellings over the year to September, up 17.4% on the previous year.

Also today - The Reserve Bank of India cut rate in unscheduled meeting, cutting its benchmark repurchase rate by 0.25% to 7.75%, while the Bank of Korea kept interest rates steady at 2% as expected by the market.

The Australian dollar got a big boost from the better than expected jobs data. It's trading at 82.10 US cents.

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