After two days of heavy losses, looks like the Australian share market may be set to take breather with the SPI pointing to a flat start. On Wall Street, US stocks fell for the third day as jitters over the euro-zone debt crisis intensified on news Moody's has cut Ireland's debt rating to junk.
US economic news
The Commerce Department has reported that America’s trade deficit widened more than expected in May to its highest level in almost three years. The US imported $US50.2 billion more than it exported in the month, much more than a revised $US43.6 billion in April.
Figures
On Tuesday, the Dow Jones Industrial Average fell 59 points to close at 12,447, the S&P500 eased 6 points to close at 1,314 and the NASDAQ dropped 21 points to close at 2,782.
European stocks closed lower: London’s FTSE down 60 points, Paris down 33 and Frankfurt was down 56 points.
To Asian markets, stocks were also lower: Hong Kong’s Hang Seng was down 684, Tokyo Nikkei was down 144 and China’s Shanghai Composite was down 48 points.
The Australian share market closed almost 2 per cent down on Tuesday: The S&P/ASX 200 Index fell 87 points to close at 4,495. On the futures market the SPI is currently 1 point higher.
Currencies
The Australian Dollar at 7:30AM was buying $1.061 US cents, 66.6 Pence Sterling, 83.7 Yen and 75.96 Euro cents.
Economic news
Due out today is the Australian Bureau of Statistics lending finance data for May and also Westpac and the Melbourne Institute’s survey of consumer sentiment for July.
Company news
Yesterday shares in National Australia Bank Ltd (ASX:NAB) fell 3.71 per cent to close at $23.88. It was the bank’s steepest one-day fall since November last year in a day that saw losses across the financials, pushing the whole sector 2.3 per cent down at close. Amid the unfolding debt crisis in Europe investors sold out of NAB, the bank that has the biggest exposure in the region among Australia’s big four. In the first half of its 2011 financial year, National Australia Bank recorded a net profit of $2.4 billion.
Shares in ANZ Banking Group (ASX:ANZ) dropped 2.23 per cent yesterday to close at $21.08. Australian banks could reap the rewards of a carbon tax. According to the Australian Financial Review, through launching new products and services banks could tap into a market believed to be worth tens of billions of dollars annually. The AFR says companies such as ANZ, Westpac Banking Corporation Ltd (ASX:WBC) and Macquarie Group Limited (ASX:MQG) are especially keen to establish themselves in the Australian market as they have experience in European carbon markets. In the first half of its 2011 financial year, ANZ recorded a net profit of $2.7 billion.
Ex-dividends
No companies are going ex-dividend today. Coming up tomorrow is Finbar Group.
Commodities
Gold is up $13.10 to $US1,562 an ounce for the August contract on Comex, silver is down $0.06 to $35.63 for September and copper is up $0.02 at $4.39 a pound. Oil is up $2.28 at $97.43 a barrel for August light crude in New York.
