Australian Stock Market Report – Afternoon October 8, 2014

IN PHOTO: Office workers are reflected as they walk past the Australian Securities Exchange building in central Sydney April 8, 2011. Singapore Exchange Ltd has terminated its $8 billion bid for Australia's ASX Ltd after the Australian government formally rejected the offer on national interest grounds and said changes to the country's financial systems were needed before the bourse could be bought by foreigners. REUTERS/Daniel Munoz

Stocks fail to recover in afternoon

 Unlike trade on Tuesday the local market maintained its hefty losses for the duration of the session to fall to a fresh eight-month low for the third day. Losses were recorded in all sectors bar the defensive utilities with concerns of Germany's economy together with cuts to world growth forecasts by the IMF concerning some investors.

 The miners wiped out almost all of yesterday's improvements which were driven by takeover speculation for Rio Tinto (RIO). The industry was sold off today with falls in excess of 1 per cent commonplace. Due to a weaker greenback overnight the price of iron ore rose by 1.4 per cent or $1.1 to US$80/t, gold rose by 0.4 per cent to US$1212.4/ounce while oil slumped by 1.6 per cent to US$88.8/barrel following prospects of lower growth in Europe.

 Banks slipped by around 0.75 per cent; adding to September's 6.6 per cent slump. Brisbane based financial institution Bank of Queensland (BOQ) fell by 0.75 per cent today ahead of its FY14 profit results tomorrow.

 The healthcare sector has been one of the standouts in recent years and one of the few to come out of the GFC relatively unscathed. Aged care provider Regis Healthcare (REG) couldn't replicate its 10 per cent surge on debut yesterday with REG slipping by 0.5 per cent. Biopharmarceutical company CSL said it will spend $210 million on expanding Melbourne plasma manufacturing plant. CSL fell by 0.25 per cent.

 By the close, 1.86 billion shares were traded worth $4.73 billion. 293 stocks finished higher, 597 were down and 361 ended flat. The Australian dollar sits at US87.8c and iron ore prices 'seem' to be showing signs of stabilising with prices hovering around US$80/dry tonne.

 Most markets in the region weakened with the exception of the Chinese markets following a holiday interrupted week. In fact China's sharemarket has been closed since early last week. On the economic front China's services industry is growing at the slowest pace in eight months.

 Tonight, monthly minutes from the US central bank's September meeting will be a highlight. Investors hope the minutes will provide some hints on when interest rates might rise next. Futures are currently pointing to a better start in the US and substantial falls in European markets. Markets in the US open at 12.30am (AEDT) and 6pm (AEDT) in Europe.

 Tomorrow's September employment report will be a highlight in Australia. The Australian Bureau of Statistics (ABS) today made revisions to the monthly jobs stats for the past three months. The ABS has essentially admitted the 120,000 jobs added in August wereprobably inaccurate. Seasonal factors which usually skew readings from July-September don't seem to apply for the quarter according to Australia's statistics organisation. We're now expecting the creation of around 50,000 jobs in September rather than job losses as was previously forecast.

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