The local share market may open slightly lower this morning following a mainly flat lead from Wall St overnight. Resource stocks are likely to feel the pressure after falls in copper, gold and oil prices.
On Wednesday the local share market closed flat with the S&P/ASX 200 Index gaining 1 point to 3,768 and on the futures market the SPI200’s down 4 points.
Checking currencies at 8:35am the Aussie dollar is buying 77.87 US cents. On the cross rates the dollar is trading at 72.26 Yen, 56.11 Euro cents and 48.49 British pence.
Among the economic news due out today: ABS labour force data for June is to be released, as well as the Melbourne Institute Survey of Consumer Inflationary Expectations for July, and the Westpac/Melbourne Institute Survey of Consumer Unemployment Expectations for July.
In company news: Shares in CBH Resources Ltd (ASX:CBH) lost 18.51 per cent to 11 cents yesterday. The company has announced several major initiatives to recapitalize the company and provide further funding for its Endeavor Mine at Cobar and Rasp Project at Broken Hill. The recapitalisation involves a $40 million standby loan facility from major shareholder Toho, a share purchase plan and a top-up facility for Toho and institutional investors. CBH says these new funding initiatives, along with unrestricted cash on hand of around $30 million, the company expects to be able to aggressively pursue the development of its Rasp Project and position the company to substantially increase metal production at its flagship Endeavor mine. CBH Resources posted a $29 million loss in 2008.
Western Areas NL (ASX:WSA) shares dropped 4.12 per cent to $5.35 yesterday. The company says it has reached an agreement with China’s Jinchuan Group for a contract to sell up to 25,000 tonnes of nickel concentrate over a two year period from the Forrestania Nickel Project. The contract is scheduled to start in early 2010 and is expected to terminate in December 2011. Western Areas has an existing long term offtake agreement with BHP. The balance of the nickel not sold to BHP will be sold to Jinchuan under the new contract. Western Areas has posted net losses over the last five years.
To international markets and Wall Street closed mostly flat on Wednesday - The Dow Jones industrial average managed to add 15 points. The S&P500 Index lost 1 point and the NASDAQ gained 1 point.
European markets closed weaker: London’s FTSE down 47 points, Paris lost 39 points and Frankfurt fell 26 points.
Asian markets were also lower: Hong Kong’s Hang Seng declined 141 points. Tokyo’s Nikkei shed 227 and China’s SSE Composite lost 9 points.
Looking at Metals: Gold is down US$19.80 to US$909.30 an ounce for the August contract on Comex. For the September contract Silver is down 37 cents to US$12.85 and copper lost 7 cents to US$2.16.
And finally oil fell US$2.79 to US$60.14 a barrel for August light crude in New York.
