The Australian share market is expected to open lower today, with Wall St having one of its worst days in months, all three major indexes closing in the red. Fears that China will raise its interest rate and Ireland’s debt problems continued to weigh on the market.
US economic news: The US Bureau of Labor Statistics Producer Price Index for Finished Goods Showed producer prices increased 0.4% in October, less than expected but in line with the read over the past two months.
On Tuesday, the Dow Jones Industrial Average closed 178 points lower at 11,024. The S&P 500 Index closed 19 point weaker at 1,178 and the NASDAQ closed 44 points down at 2,470.
European stocks were lower: London’s FTSE down 139 points, Paris is down 102 and Frankfurt down 127.
To Asian markets, stocks were weaker: Hong Kong’s Hang Seng was down 334 points, Tokyo’s Nikkei was down 30 points and China’s Shanghai Composite down 120.
The Australian share market finished higher on Tuesday. The S&P/ASX 200 Index closed 12 points up at 4,700 and on the futures market the SPI200 is down 61 points. Turning to currencies and the Aussie Dollar at 8:50AM was buying 97.69 US cents, 61.5 Pence Sterling, 81.37 Yen and 72.44 Euro cents.
In local economic news: Due out today the Westpac-Melbourne Institute indexes of economic activity, The Australian Bureau of Statistics labour price index and, the Department of Employment, Education and Workplace Relations survey of skilled job vacancies advertised on November 6.
Company news: Shares in Commonwealth Bank of Australia (ASX:CBA) closed 2.11 per cent stronger at $49.89 on Tuesday. Commonwealth’s CEO Ralph Norris has topped the list for executive pay packets, taking home $16 million in the last financial year. The Australian Financial Review’s survey of executive salaries shows the average packages for CEO’s of the top 300 listed companies had a value of $2.25 million, rising 2 per cent over the average in 2009. Mr Norris’ pay surged 75 per cent in the period by almost $7 million, boosted by his long-term share incentive scheme. His $16 million salary beat the $14.9 million Westfield Group Ltd’s (ASX:WDC) CEO Frank Lowy will take home, and the $14.7 million Leighton Holdings Ltd (ASX:LEI) CEO Wal King will receive in the last year of his 42-year career at Leighton. Commonwealth Bank moved from a profit of $4.7 billion last year to $5.7 billion in the year to 30 June 2010.
Yesterday shares in Telstra Corporation Ltd (ASX:TLS) dropped 1.15% to a record low of $2.58. The dip in share price for Australia’s largest telecommunications company came as politicians were discussing new regulations that propose structural changes to Telsta. Fairfax media reports that the share price has been impacted by the Future Fund's sell-off of Telstra shares on the open market. In October the Future Fund disclosed its interest in Telstra amounted to between 4 and 5 per cent of its portfolio and that it would be targeting reducing this stake. Yesterday rival telco Vodaphone also launched a new 'Infinite' mobile cap plan. Telstra will meet this Friday for its annual general meeting. Telstra dropped from a profit of $4.08 billion in 2009 to $3.94 billion in the year to 30 June 2010.
To ex-dividends: And the two companies going ex-dividend today are Brickworks with a 27 cent fully franked dividend and Stratatel with a 0.20 cent unfranked dividend. Coming up tomorrow is Incitec Pivot with a 6 cent unfranked dividend.
To commodities: The price of gold is down $US30.10 to $US1338 an ounce for the December contract on Comex, silver is down $US0.86 to $25.23 and copper is down $0.20 at $3.73 a pound. The price of oil is down $2.52 to $US82.34 a barrel for December light crude in New York.
