The Australian share market looks to be in for a bounce this morning after Wall Street staged a sharp turnaround and closed higher in volatile session of trade. US stocks recovered some lost ground after the Financial Times reported that European finance ministers are investigating strategies to manage the recapitalization of banks.
US economic news
Federal Reserve Chairman Ben Bernanke has cautioned that "the recovery is close to faltering". Mr Bernanke also warned of “the likelihood of more sluggish job growth in the period ahead”, but also said that the Fed is prepared to act to boost the economy.
Figures
Wall Street: The Dow Jones Industrial Average spiked 153 points to close at 10,809, the S&P500 grew 25 points to close at 1,124 and the Nasdaq rose 69 points to close at 2,405.
European stocks closed lower on Tuesday: London’s FTSE was down 131 points, Paris was down 76 and Frankfurt was down 160 points.
To Asian markets, stocks were also lower: Hong Kong’s Hang Seng down 572 points, Tokyo Nikkei was down 89 and China’s Shanghai Composite was closed.
The Australian share market fell 0.7 per cent on Tuesday: The S&P/ASX 200 Index lost 25 points to close at 3,872. On the futures market the SPI is 43 points higher.
Currencies
The Australian Dollar at 8:30AM was buying 95.89 US cents, 61.93 Pence Sterling, 73.74 Yen and 71.82 Euro cents.
Economic news
Due out today from the Australian Bureau of Statistics, retail trade figures for August. From the Australian Industry Group and Commonwealth Bank of Australia (ASX:CBA), the Australian performance of services index for September. From JP Morgan and Fujitsu, the mortgage industry report.
Company news
Yesterday shares in Telstra Corporation Limited (ASX:TLS) closed 1.32 per cent lower at $3.00. Telstra’s $11 billion proposed National Broadband Network deal with the federal government has been given a thumbs up from an influential proxy adviser. A report from Institutional Shareholders Services, obtained by the Australian Financial Review, says Telstra has appeared to have taken a prudent approach to evaluating the company's strategic alternatives. The independent advisor has recommended shareholders vote in favour of the scheme when they meet at the telco’s annual general meeting on October 18, 2011. In the 2011 financial year Telstra reported a net profit of $3.25 billion.
On Tuesday shares in Qantas Airways Limited (ASX:QAN) closed steady at $1.375, and despite the record-low share price the man who played a key role in blocking an $11.1 billion takeover of the airline in 2007 has ruled out speculation that suitors could be preparing to swoop. Andrew Sisson, the managing director of Balanced Equity Management, who hold a 10 per cent interest in Qantas, has told the Australian Financial Review a takeover any time soon is unlikely. Mr Sisson says this is because of regulatory barriers and a series of cyclical pressures, such industrial action, that have put pressure of the company’s share price, already having lost 46 per cent of its value this year. In the 2011 financial year Qantas reported a net profit of $249 million.
Ex-dividends
No companies are going ex-dividend today. Among those coming up later this week: GBST Holdings, OrotonGroup, Clime Capital, Marbletrend Group and National Can Industries.
Commodities
Gold is down $41.70 to $US1,616 an ounce for the December contract on Comex.
Silver is down $0.96 cents to $29.84.
Copper is down $0.05 at $3.10 a pound.
Oil is down $1.94 at $75.67 a barrel for November light crude in New York.
