The Australian share market closed 0.6 per cent down today, recording the steepest weekly drop in nine weeks, dragged down by weakness in the resource sector on concerns about China’s plans to moderate economic expansion.
The S&P/ASX200 Index eased 28 points to close at 4,756 while on the week it was 40 points lower, its worst performance since mid-November. On the futures market, the SPI is down 34 points.
Looking to the US and on Wall Street, the DOW Jones Industrial Average was up 35 points over the three trading days this week. The S&P500 Index was down 13 points, NASDAQ was down 51 and the 100 Index was down 37.
In economic news: The Australian Bureau of Agricultural, Resource and Sciences has warned that the recent floods in Queensland could slice around $2 billion to $2.5 billion off Australia's coal export earnings and cost the agricultural sector between $500 million to $600 million from December 2010 to March 2011.
Company news: Despite the rising economic impact of the floods in Queensland, Aquila Resources Ltd (ASX:AQA) and Cockatoo Coal Ltd (ASX:COK) have today both confirmed their coal production is slowly getting back on track. Aquila says it has recommenced mining, coal washing and train loading at its mine in the Bowen Basin, though cautioned it will take a while to return to maximum production. Shares in Aquila Resources slipped 0.81 per cent to close at $9.77.
Westpac Banking Corporation’s (ASX:WBC) CEO Gail Kelly has warned that the bank expects funding costs to peak in around 18 months. Speaking today at the senate inquiry into banking competition, Mrs Kelly welcomed the introduction of covered bonds to lessen funding costs for the big banks and said they are an important step to allow Westpac to leverage its mortgages. Shares in Westpac lifted 0.71 per cent to close at $22.55.
Fortescue Metals Group (ASX:FMG) CFO Stephen Pearce has told Bloomberg that the miner is gearing up to raise $US2.5 billion, as early as this year, to fund the expansion of its iron ore mines.
Spotless Group Ltd (ASX:SPT) has won a contract to supply cleaning, housekeeping, linen and laundry services to the London 2012 Olympic Games, requiring the resources of around 1,800 employees.
In the best and worst performers: The best performing sector at close was Financials Excluding Real Estate Investment Trusts with the index lifting 18 to close at 5,114. The worst performing sector was Materials, the index dropped 200 points to close at 13,793. The best performing stock in the S&P/ ASX200 was Aurora Oil & Gas shares advanced 3.85 per cent to close at $2.70. Shares in Alesco Corporation and Spark Infrastructure Group also rose today. The worst performing stock was Energy World Corporation shares eased 8.41% to close at $0.41. Shares in Paladin Energy and Medusa Mining also dropped today.
In commodities, gold is trading at $US1,346 an ounce and is down $14.45 on the week. Light crude is 15 cents down at $US89.44 a barrel.
The Australian dollar is trading at 98.64 US cents, and is slightly down on the week.
