ASX to open flat as Wall Street rally loses steam

The Australian share market is expected to open flat this morning following weak leads globally.

After posting new record highs for five straight days, it was time for Wall Street to finally take a breather. US equities snapped their winning streak and mostly finished lower this morning. The Utilities sector was the strongest performer, while Energy shares were the biggest drag on the US markets.

This week, the US posted some solid economic data and corporate results. Also, Federal Reserve chair Janet Yellen gave her testimony this week about the strengthening US economy – which could boost the case for the Fed to potentially raise interest rates next month.

US economic news

The Census Bureau released its statistics for the number of building permits issued in January. Last month, permits increased by 4.6% to a 1.29 million annualised rate, which was higher than expected.

Also, Labor Department’s jobless figures for last week showed the number of Americans filing for unemployment benefits rose less than expected – with initial claims up by 5,000 to a seasonally adjusted 239,000. The unemployment rate is currently at 4.8% - which is at or close to full employment.

Markets

The Dow Jones was flat at 20,620 points, the S&P 500 lost 0.1% to 2,347 and the NASDAQ was down 0.1 per cent to 5,815.

European markets finished lower: London’s FTSE was down 0.3 per cent, Paris lost 0.5 per cent and Frankfurt dipped 0.3 per cent.

Asian markets were mixed: Tokyo’s Nikkei fell 0.5 per cent, while the Hang Seng and Shanghai Composite both gained 0.5% each.

The Australian share market finished higher yesterday: The S&P/ASX 200 Index rose 0.1% (or 7 points) to close at 5,816. On the futures market the SPI is down 1 point.

Company news

James Packers’ Crown Resorts (ASX:CWN) has confirmed its sale of 198 million shares in its joint venture Melco Crown Entertainment Ltd closed yesterday. These shares were sold to Melco International Development Ltd (which is Crown’s joint venture partner). Melco International will now have a 51.3% stake in the joint venture, while Crown Resorts’ stake is now 11.2%. Yesterday, shares in Crown Resorts closed 0.52% higher at $11.62.

Reporting season

It’s first-half earnings season, and a few companies will release their results today. They include: ASX Ltd (ASX:ASX), Duet Group (ASX:DUE), Medibank Private (ASX:MP), Mantra Group (ASX:MTR) and Santos (ASX:STO)

Ex-dividends

Three companies are going ex-dividend today. They are:
Ansell Limited (ASX:ANN) will pay an unfranked dividend of 26.49 cents per share.
Argo Investments (ASX:ARG) will pay 15 cents, fully franked.
Lantern Hotel Group (ASX:LTN) will pay 5 cents, unfranked.

Currencies

The Australian Dollar at 8:30AM was buying $US0.7696, 61.64 Pence Sterling, 87.14 Yen and 72.11 Euro cents.

Commodities

Gold has gained $6.10 to $US1,241 an ounce.
Silver was up 12 cents to $18.15 an ounce.
Oil has lifted $0.31 to $US53.83 a barrel.