The Australian share market looks set to slip this morning, amid rising fears that Japan’s earthquake has triggered a nuclear catastrophe in the region. On Wall St stocks trimmed earlier steep losses after an encouraging statement from the Federal Reserve. But, the closely monitored crisis in Japan continues to unnerve global equity markets with all closing in the red.
In US economic news: The US Federal Reserve said, “Economic recovery is on a firmer footing, and overall conditions in the labor market appear to be improving gradually”, one of the central bank’s most encouraging statements in years.
On Tuesday The Dow Jones Industrial Average closed 138 points lower at 11,855, S&P500 fell 15 points to close 1,282 and the NASDAQ dropped 34 points to close 2,667.
European stocks closed lower on Tuesday: London’s FTSE down 80 points, Paris down 97 and Frankfurt down 219.
To Asian markets and stocks also closed lower: Hong Kong’s Hang Seng was down 668, Tokyo Nikkei tumbled 1,015 and China’s Shanghai Composite was down 41 points.
The Australian share market dropped 2 per cent yesterday: The S&P/ASX 200 Index fell 98 points to close at 4,529. On the futures market the SPI200 closed at 4,558 for June.
Turning to currencies and the Australian Dollar at 8:50AM was buying $US99.05 cents, 61.59 Pence Sterling, 79.98 Yen and 70.77 Euro cents.
Economic news: Due out today is the Australian Bureau of Statistics dwelling unit commencements for the 2010 December quarter, and also, the Westpac-Melbourne Institute leading indexes of economic activity.
Company news: On Tuesday shares in Rio Tinto Ltd (ASX:RIO) dipped 2.2 per cent to close at $77.41. Rio’s CEO Tom Albanese took home almost $9 million in 2010, representing a 31 per cent improvement from the year before. According to the mining giant’s annual report Mr Albanese significant rise in remuneration comes after lift in proceeds from his short term incentive plan in a year that Rio generated a record full year profit. Mr Albanese has worked for Rio Tinto for 29 years, and held the position of CEO since May 2007. Rio Tinto posted a net profit of $14.9 billion in the 2010 financial year.
Yesterday shares in Wesfarmers Ltd (ASX:WES) slipped 2.07 per cent to close at $30.74. Wesfarmers-owned Coles has defended its role in the so-called milk-wars, refuted claims from the dairy industry that cutting the price of its home brand milk to $1 per litre will drive dairy farmers out of business. In a submission to a Senate inquiry the supermarket giant says it fully absorbs the lower retail milk prices in its own retail margins, rather than charging milk processing companies. Coles played down its power in the milk wars, suggesting that increased transparency at farm gate pricing and improved ability for dairy farmers to collectively negotiate would assist farmers. In the first six months of the 2011 financial year, Wesfarmers booked a net profit of $1.2 billion.
Ex-dividends: And four companies are going ex-dividend today and they are: Adcorp with a $0.01 fully franked dividend, Melbourne IT with an $0.08 fully franked dividend, M2 Telecommunications Group with a $0.07 fully franked dividend and Village Roadshow with a $0.20 dividend, 70 per cent franked. Coming up tomorrow are Retail Food Group and WAM Active.
Commodities: Gold is down $32.10 to $US1,392 an ounce for the April contract on Comex, silver is down $1.72 to $34.12 for May and copper is down $0.05 at $4.14 a pound. Oil is down $4.01 at $97.18 a barrel for April light crude in New York.
