Australian stocks are likely to fall again today after equity markets in Europe and the US slumped overnight on concerns that the global economic recovery won't be as smooth as investors had been hoping.
Falls on Wall Street were accelerated after President Barack Obama unveiled plans to limit the size and scope of US banks and finance firms.
The latest economic news out of the US only added to the pressure.
The number of Americans filing new claims for unemployment rose to 482,000 from 446,000 the week before. Economists thought claims would actually fall.
Continuing claims, which measures people receiving jobless benefits for a week or more, fell to just under 4.6 million from 4.617 million the previous week.
And the regional reading on manufacturing, the Philadelphia Fed Index fell to 15.2 in January from 22.5 in December versus forecasts for a drop to 18.
Checking the figures, the Dow Jones Industrial Average fell 213 points to 10,390. The S&P500 Index lost 22 to 1,116 and the NASDAQ is down 26 points at 2,266.
To other international markets, Europe was lower. London’s FTSE dropped 86 points and Paris is down 67, and Frankfurt fell 105 points.
Asian markets were mixed with Hong Kong’s Hang Seng down 424 points, Tokyo’s Nikkei rose 131 and China’s Shanghai Composite is up 7 points.
On the local share market shares fell on Thursday dragged down by the miners. The S&P/ASX 200 Index finished 41 points lower at 4,827 and on the futures market the SPI200’s down 93.
In economic news out today: the ABS is scheduled to release its international trade prices indexes for the December quarter.
Also some important company events and news to watch out for today:
Macquarie Infrastructure Group will hold an extraordinary general meeting to vote on plans to spit.
And, Woodside Petroleum, Oil Search, Beach Energy, Lihir Gold and Macarthur Coal are all expected to release December-quarter production reports.
On to currencies: the Aussie Dollar at 8:30AM was buying 90.12 US cents, 81.52 Yen, 63.98 Euro cents and 55.66 Pence Sterling.
In company news about this morning:
OM Holdings (ASX:OMH) shares closed 3.03% weaker yesterday at $1.92. The manganese miner says it'll take a 10 per cent stake in Norway-focused iron ore hopeful Northern Iron under a $40.96 million investment. OM Holdings says it’s agreed to subscribe for 28.25 million Northern Iron shares at $1.45 a share. OM Holdings says it will initially fund the investment from existing cash reserves but was also assessing "other financing options to more appropriately gear the investment". OM Holdings' 2009 net profit was $115 million.
Viterra (ASX:VTA) shares gained 0.27% to $10.92 on Thursday. Viterra has announced its intention to reduce the short-term debt of its Australian operations by $317 million by the end of this month. In light of Viterra's strong liquidity position, the Company is utilizing the surplus cash to reduce seasonal drawings on the $1.2 billion operating facility of its wholly owned Australian subsidiary, formerly known as ABB Grain. The action is expected to reduce the Company's interest expense by about $1.4 million per month with the funds expected to be used to support Viterra's future growth plans.
Taking a look at ex-dividends: Contango Microcap is going today with a 2 cent fully franked dividend. And coming up next week, Ozgrowth, Westoz Investment Company and Djerriwarrh Investments are also set to go ex-dividend.
To commodities: Gold fell overnight, down $9.60 to US$1,103 an ounce for the February contract on Comex. For the March contract silver lost 29 cents to US$17.60 and copper is down 5 cents at US$3.31.
The price of oil closed lower overnight, losing $1.66 to US$76.08 a barrel for February light crude in New York.
