The Australian market is expected to open lower today after being hit with negative offshore leads. US stocks fell over 2 per cent, with the Dow and S&P 500 recording their worst day of the year after Wall St was struck with a disappointing batch of weak economic reports, stoking concerns about the state of economic recovery.
US economic news: ADP Employer Services reported private-sector employers added 38,000 jobs in May, significantly under the 170,000 jobs added the month before and the lowest level of job growth since September 2010. Also, the Institute for Supply Management's manufacturing index dropped to 53.5 in May from 60.4 in April, coming in well below expectations.
On Wednesday, the Dow Jones Industrial Average dropped 280 points to close at 12,290, the S&P500 lost 31 points to close at 1,315 and the NASDAQ fell 66 points to close at 2,769.
European stocks closed lower: London’s FTSE was down 61 points, Paris down 42 and Frankfurt was down 76 points.
To Asian markets and stocks were mixed: While Hong Kong’s Hang Seng was down 58, Tokyo Nikkei was up 26 and China’s Shanghai Composite was flat.
The Australian share market finished flat on Wednesday. The S&P/ASX 200 Index lost 1 point to close at 4,707. On the futures market the SPI is down 72 points.
Turning to currencies and the Australian Dollar at 7:35AM was buying 1.0615 US cents, 64.97 Pence Sterling, 85.87 Yen and 74.11 Euro cents.
Economic news: Due out today is the Australian Bureau of Statistics international trade in goods and services and retail trade data, both for April.
Company news: Yesterday shares in Rio Tinto Ltd (ASX:RIO) firmed 0.06 per cent to close at $81.55. Global miner Rio Tinto and Chinese alumina producer Chinalco have formed a joint venture for exploration in China. The JV will operate under the name Chinalco Rio Tinto Exploration Co Ltd and focus first on copper exploration and potentially later coal and potash. Chinalco will hold a 51 per cent stake in the JV with Rio holding the remaining 49 per cent. In the 2010 financial year Rio Tinto recorded a net profit of $14.9 billion.
Yesterday shares in Coca-Cola Amatil (ASX:CCL) dipped 0.34 per cent to close at $11.74. Coca-Cola Amatil’s US parent company, Coca-Cola Company, is gearing up to expand its presence in the world’s most populous nation as it explores listing on the Shanghai Stock Exchange. The world's largest soft-drink company has told Reuters that it is involved in positive discussions with Chinese government officials to explore the opportunity. As foreign companies are not as yet able to list in mainland China, the New York Stock Exchange is believed to be working with China to introduce an international board, enabling Coca-Cola to be one of the first to join if it goes ahead. Coca-Cola Amatil reported a net profit of $497 million in the 2010 financial year.
Ex-dividends: The two companies going ex-dividend today are National Australian Bank with an $0.84 cent fully franked dividend and Transmetro Corporation with a $0.05 fully franked dividend. Among those coming up next week are Campbell Brothers and CSR.
Commodities: Gold is up $6.50 to $US1,542 an ounce for the June contract on Comex, silver is down $0.61 to $37.69 for July and copper is down $0.07 at $4.11 a pound. Oil is down $2.41 at $100.29 a barrel for July light crude in New York.
