The Australian share market entered selling territory today, dropping like a stone at the open, snapping its record run, but the XJO is still holding above pre-GFC highs, and now starting to recover.
Today’s stumble comes as the iron ore price fell 1.8 per cent, pulling down the miners, with Rio Tinto (ASX:RIO) and BHP (ASX:BHP) sliding over 2 per cent. But we also had negative leads from Wall Street to follow, after the Dow shed over 100 points on the back of the corporate tax cut being pushed back.
Despite that, half of the market is pushing higher, with Reits and Discretionaries boding the best. Adairs (ASX:ADH) is 3.6 per cent higher, while the majority of property funds are all on the up.
The S&P/ASX 200 index is 18 points down or 0.3 per cent lower at 6,031.
On the futures market the SPI is 22 points lower.
Local economic news out
The Statement of Monetary Policy was released by the RBA, noting the Australian economy is expected to expand at a solid pace over the next couple of years. It also noted the drag on mining investment has now eased and ‘is likely to end next year or so’. The RBA said although inflation and wage growth has remained low, it should gradually increase over time. That news was absorbed well by the market and we started to claw back some of our early losses.
The joint venture project with Origin Energy (ASX:ORG) and AWE (ASX:AWE) has delivered what they are calling excellent gas flows at their onshore Perth basin Waitsia field. It comes as the oil giants started flow testing and hit a maximum gas flow rate of 27.7 million standard cubic feet per day. The companies say the results shows it is an outstanding reservoir system. Shares in Origin Energy (ASX:ORG) are trading about 0.5 per cent higher at $8.43.
Jewellery retailer, Michael Hill International (ASX:MHJ) has appointed a partner from PriceWaterhouseCoopers (PwC) and the previous Managing Director of Clemenger BBDO Brisbane to the company. The company appointed Vanessa Brennan as its Chief Customer Officer, with her appointment to kick into effect early next year. Shares in Michael Hill International (ASX:MHJ) are trading about 0.5 per cent lower at $1.07.
And one of the world’s largest uranium producers, Cameco, is set to shave 10 per cent of the world’s supply out of the market temporarily. In response Boss Resources (ASX:BOE) informed the market that as it’s one of four fully permitted uranium operators in Australia with its export licence, it is ready to participate. The miner also says the uranium spot price could also see a bull run on the back of the global reductions in uranium supply. Shares in Boss Resources (ASX:BOE) are trading about 5.2 per cent lower at $0.06.
The best and worst performers
The best performing sector is Reits, gaining almost 1 per cent to 1,413. Shares in Westfield Corporation (WSA:WFD) have risen 2.84 per cent and trading at $8.33. Shares in Abacus Property Group (ASX:ABP) and Scentre Group (ASX:SCG) are also stronger.
The worst performing sector is Materials, falling 1.4 per cent to 11,035. Shares in Western Areas (ASX:WSA) have fallen 3.09 per cent, trading at $3.29. Shares in CSR (ASX:CSR) and Mineral Resources (ASX:MIN) are also lower.
Commodities and the dollar
Gold is trading at $US1,287 an ounce, while, Oil has risen back above the US$57 mark and one Australian dollar is buying 76.87 US cents.