The Australian share market looks set for a cautious start to the day as investors monitor European political and economic developments. As Greek coalition discussions continue the focus has turned to Italy where bond yields have climbed to new highs and pressure is mounting for the Italian Prime Minister to step down.
US economic news
The Chicago Board Options Exchange Volatility Index, also known as the ‘fear index’, increased 5.4 per cent to 31.79. The index indicates the market's expectation of 30-day volatility.
The Federal Reserve has reported consumer borrowing increased more than expected in September. Credit rose $7.4 billion in September to $2.452 trillion, after dropping $9.7 billion the month before.
Figures
Wall Street reversed earlier losses to start the week higher: The Dow Jones Industrial Average added 85 points to close at 12,068, the S&P500 edged up 8 points to close at 1,261 and the Nasdaq gained 9 points to close at 2,695.
European stocks finished lower on Monday: London’s FTSE was down 16 points, Paris was down 20 points and Frankfurt was down 37 points.
Asian markets closed lower: Hong Kong’s Hang Seng was down 165 points, Tokyo Nikkei was down 34 and China’s Shanghai Composite was down 18.
The Australian share market started the week in the red: The S&P/ASX 200 Index lost 8 points to finish at 4,273. On the futures market the SPI is 8 points higher.
Currencies
The Australian Dollar at 8:30AM was buying $US1.0369, 64.61 Pence Sterling, 80.96 Yen and 75.32 Euro cents.
Economic news
Due out today from the Australian Bureau of Statistics is international trade in goods and services data for September and National Australia Bank Limited's (ASX:NAB) monthly business survey for October.
Company news
Shares in ASX Limited (ASX:ASX) finished 0.73 per cent higher on Monday at $30.36. ASX’s rival trading platform Chi-X has been granted approval from the Australian Securities and Investments Commission to start trading the top 200 companies. ASX lost its monopoly last week when Chi-X begun its soft launch period test phase of trading six stocks. The Australian Financial Review says Chi-X last week averaged about 2,000 daily trades, or about 0.1 per cent of the total equity trading market while it was handling about 0.7 per cent of trading. In the 2011 financial year ASX posted a net profit of $352 million.
Yesterday shares in MAp Group (ASX:MAP) closed steady at $3.45. Airport operator MAp Group has posted a 4 per cent increase in pro forma EBITDA for the first nine months of 2011. CEO Kerry Mather says MAp delivered solid operational performance in a period that was impacted by numerous disruptions such as Asia-Pacific natural disasters, Middle Eastern unrest Europe’s economic conditions and, in Australia, Tiger Airways grounding and Qantas’ industrial action. MAp recently boosted its stake in Sydney Airport to 85 per cent and MAp says in the same nine month period the airport’s EBITDA rose 2.8 per cent, outperforming traffic growth of 1.1 per cent. In the first half of its 2011 financial year MAp Group reported a net loss of $296 million.
Ex-dividends
Three companies are going ex-dividend today: Desane Group Holdings with a $0.01 unfranked dividend, Kathmandu Holdings with a $0.05 fully franked dividend and Washington H. Soul Pattinson and Co. with an $0.25 fully franked dividend. Coming up tomorrow: Bank of Queensland and Ten Network Holdings.
Commodities
Gold is up $35.00 to $US1,791 an ounce for the December contract on Comex.
Silver is up $0.74 to $34.83.
Copper is down $0.035 at $3.53 a pound.
Oil is up $1.26 at $95.52 a barrel for November light crude in New York.
