The Australian share market looks poised to claw back from some of this week’s losses after Wall Street rebounded from a two-day selloff. US investors focussed on better than expected jobs figures and a mixed economic outlook from the Federal Reserve. At home, the last of the big four banks has this morning reported its annual results. ANZ Banking Group (ASX:ANZ) has posted a 12 per cent increase its cash profit, hitting $5.65 billion.
US economic news
The Federal Reserve's latest policy statement has lowered the US economic growth outlook to between 1.6 per cent and 1.7 per cent for 2011. The central bank also believes the unemployment rate will drop from 9 per cent to as low as 7.8 per cent in 2012. Comments from the Fed’s chairman Ben Bernanke appeased investors with affirmation America’s central bank is ready to act and prepared to take further action to boost the nation’s economy.
Ahead of Friday’s key jobs report from the US government:
Payroll processing firm, ADP, showed 110,000 jobs were added by private-sector employers in October and the number of jobs created the month before was revised higher.
Challenger, Gray & Christmas reported planned job layoffs fell 63 per cent in October from the month before.
Figures
Wall Street closed higher on Wednesday: The Dow Jones Industrial Average gained 178 points to close at 11,836, the S&P500 added 20 points to close at 1,238 and the Nasdaq rose 33 points to close at 2,640.
European stocks closed higher on Wednesday: London’s FTSE was up 63 points, Paris was up 42 and Frankfurt was up 131 points.
To Asian markets, stocks closed mixed: Hong Kong’s Hang Seng up 364 points, Tokyo Nikkei was down 195 and China’s Shanghai Composite was up 34 points.
On Wednesday, the Australian share market closed more than 1 per cent lower: The S&P/ASX 200 Index lost 48 points to close at 4,185. On the futures market the SPI is 43 points higher.
Currencies
The Australian Dollar at 8:50AM was buying $US1.0345, 64.86 Pence Sterling, 80.79 Yen and 75.25 Euro cents.
Economic news
Due out today from the Australian Bureau of Statistics is retail trade data for September. From Australian Industry Group and Commonwealth Bank of Australia (ASXCBA) the Australian performance of services index for October.
Company news
Yesterday shares in News Corporation (ASX:NWS, PINK:NWSCZ, LON:NCRB) finished 1.9 per cent down at $16.51. Rupert Murdoch’s News Corp has started the 2012 financial year with a lower profit than the year before, dragged down by one-off charges. The international media company first quarter net profit fell $36 million to $716.5 million, impacted by costs relating to withdrawing its bid for British Sky Broadcasting, cost adjustments from its German pay-tv business and restructuring charges for its UK newspaper business. However, first quarter earnings before interest and tax grew 21 per cent and revenue was up 7 per cent. Mr Murdoch says the results showed “exceptional strength”. In the 2011 financial year News Corp posted a net profit of $2.69 billion.
On Wednesday shares in Collins Foods Limited (ASX:CKF) closed at $1.43, after plunging 23.94 per cent following a shock trading and guidance update. Collins Foods lost a quarter of its value, or $42 million, after it revealed first half same-store sales for KFC were flat while Sizzler’s sales fell 4 per cent. The newly listed company has attributed fragile consumer confidence and a highly competitive restaurant industry for lower customers numbers at its 119 KFC restaurants and 85 Sizzler restaurants in Australia. Collins Foods says it now expects to achieve an annual net profit of between $18 million to $20 million, down from its $25 million original forecast.
Commodities
Gold is up $17.80 to $US1,729 an ounce for the December contract on Comex.
Silver is up $1.21 cents to $33.94.
Copper is up $0.08 at $3.58 a pound.
Oil is up $0.32 at $92.51 a barrel for November light crude in New York.
