Market Wrap: Shares hover before Fed speech

Market Reports

The Australian share market shrugged off negative leads this morning, opening higher before dipping at noon and hovering in the red for the rest of the day. Global jitters capped gains ahead of a highly anticipated speech from US Federal Reserve chairman Ben Bernanke, expected to reveal how the US central bank plans to stimulate its economy. 

The S&P/ASX200 Index closed 13 points down at 4,200. For the week, the index shed 98 points. On the futures market, the SPI is 18 points lower.

On Wall Street, over the four trading days this week: The Dow Jones Industrial Average rose 332 points, the S&P 500 Index added 36 points, the NASDAQ gained 78 and the 100 Index lifted 70.

Economic news

A rate rise next week is looking unlikely after The Reserve Bank of Australia’s governor, Glenn Stevens, indicated the central bank is in no hurry to tighten monetary policy amid the financial turmoil of recent weeks. Mr Stevens cautioned that the level of inflation is “a bit troubling” and while it needs to be carefully watched the bank believes it can keep inflation under control.

Company news

Shares in Fairfax Media Limited (ASX:FXJ) rose today, after unveiling plans to partially float its Trade Me website, New Zealand's biggest online auction and classified advertising business. The proceeds will be used to reduce debt and provide flexibility to increase dividends. Fairfax also today posted a full year net loss of $391 million, dragged down by $650 million of write downs on the value of its newspapers. A final dividend of 1.5 cents per share has been declared. Shares in Fairfax Media rose 7.1 per cent today, closing at $0.83.

Sims Metal Management Limited (ASX:SGM) gained after the world's largest scrap metal recycler revealed a 52 per cent jump in its full year net profit, coming in it $192 million. The result came in higher than market expectations and was achieved through improved intake and shipments, pricing and gross margins. A final dividend of 35 cents per share has been declared, 43 per cent franked. Sims Metal Management gained 3.17 per cent today, closing at $15.29.

Shares in Woolworths Limited (ASX:WOW) continued to slide today after announcing it will launch insurance products. The news comes just one day after the supermarket giant posted lower than expected annual growth and warned of a tough year ahead. 

Shares in Perpetual Limited (ASX:PPT) surged to the best performer of the day. Despite booking a 31 per cent drop in its full year net profit, the wealth manager also announced a $70 million off-market share buy-back. Perpetual has declared a final, fully franked dividend of 90 cents.

Best and worst performers

Most sectors closed lower: The best performing sector was Utilities, rising 66 points to close at 4,432. The worst performing sector was Telco Services, falling 16 points to close at 1,052 points. The best performing stock in the S&P/ASX200 was Perpetual, surging 10.05 per cent to close at $26.49. Shares in Seven West Media and Fairfax Media also ended the week stronger. The worst performing stock was Infigen Energy, losing 5.45 per cent to close at $0.26. Shares in BlueScope Steel and Billabong International also closed lower today.

Commodities

Gold is trading at $US1,773 an ounce and is down $78.00 on the week. Light crude is down $0.23 cents at $US85.07 a barrel.

The Australian dollar

The Australian dollar is buying $US1.049 cents, and is up by 1 cent on the week.


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