The Australian share market is likely to open lower after Wall Street fell on worries about the US economy with expectations that GDP growth in the second quarter will be downwardly revised.
Those concerns overshadowed the latest US economic news: The Labor Department said the number of people filing for first-time unemployment insurance fell by more than expected, with 31,000 less claims to a total of 473,000 for the week, down from 504,000. The Dow Jones Industrial Average fell 74 points to close below that 10,000 mark at 9,986. The S&P 500 Index lost 8 to 1,047 and the NASDAQ is down 23 points at 2,119.
European stocks gained; London’s FTSE rose 46 points, Paris is up 25 and Frankfurt added 13 points.
Asian markets were mixed: Hong Kong’s Hang Seng fell 23 points on Thursday, Tokyo’s Nikkei rose 61 points and China’s Shanghai Composite is up 7 points.
The Australian share market closed higher on Thursday tracking Wall Street’s gains and influenced by some positive company results. The S&P/ASX 200 Index closed 36 points higher at 4,356 and on the futures market the SPI200 down 36 points. The Aussie Dollar gained against the US overnight but was lower against the other major currencies and at 7:30AM was buying 88.65 US cents, 57.08 Pence Sterling, 74.89 Yen and 69.71 Euro cents.
Making news in business this morning: Shares in Woolworths Ltd (ASX:WOW) closed 2.37 per cent higher at $27.54 on Thursday. Woolworths is expected to embark on a new cost-cutting drive in a bid to maintain its long record of double-digit growth which was highlighted by a $2 billion profit result yesterday. The company’s chief executive Michael Luscombe has cautioned that the next six months will be tough for retailers with low food price inflation, weak consumer demand and increased competition from Coles. But despite that Mr Luscombe has flagged the continuation of 8-11 per cent growth in 2011 and says that the group remains on the look-out for acquisitions in Australia and overseas. Woolworths reported a net profit after tax of $1.8 billion for the year to 30 June 2009.
Shares in Telstra Corporation Ltd (ASX:TLS) finished steady at $2.76 on Thursday. The Australian newspaper reports that the telecommunications giant will not participate in the auction for the New Zealand Yellow Pages, and instead it will turn its focus to Asia. The newspaper says that Telstra’s directories business Sensis, decided against making a bid for the debt- troubled New Zealand firm, before next week's deadline. The paper says that one influencing factor for that decision might be a lack of compatibility between Sensis' IT systems and those of NZ’s Yellow Pages. Telstra’s net profit after tax increased in the year to 30 June 2009, from on the year before to just over $4 billion.
There are a number of companies going ex-dividend today including, Blackmores 70 cent fully franked, Cochlear $1.05, 60 per cent franked and UGL with a 35 cent fully franked dividend. To commodities: the price of gold is down US$4.10 to US$1,235 an ounce. Silver lost 4 cents to US$18.98, copper added 9 cents at US$3.31 a pound. And the price of oil lifted 84 cents overnight to US$73.36 a barrel for October light crude in New York.
