Following weak offshore leads the Australian share market looks set for a weak start to the day. US stocks ended a choppy session lower, weighed down by rising European bond yields and a soft read of US growth. Wall Street closed off session lows after the International Monetary Fund revealed a program to aid countries impacted by short-term liquidity problems. At home eyes will be on the mining sector after the Minerals Resource Rent Tax Bill passed in the lower house this morning.
US economic news
In a revision to US economic growth data the Commerce Department has reported US gross domestic product grew at an annual rate of 2 per cent in the third quarter, coming in lower than expected and lower than 2.5 per cent growth reported the quarter before.
Minutes from the US Federal Reserve’s November meeting increased optimism that the central bank may initiate more quantitative easing to stimulate the economy. According the Fed's minutes, "A few members indicated that they believed the economic outlook might warrant additional policy accommodation".
Figures
Wall Street closed lower on Tuesday: The Dow Jones Industrial Average dropped 54 points to close at 11,494, the S&P500 dipped 5 points to close at 1,188 and the Nasdaq eased 2 points to close at 2,521.
European stocks finished lower for the fourth consecutive session: London’s FTSE was down 16 points, Paris was down 24 points and Frankfurt was down 69 points.
To Asian markets, stocks closed mixed: Hong Kong’s Hang Seng was up 26 points, Tokyo Nikkei was down 34 and China’s Shanghai Composite down 3 points.
The Australian share market trimmed losses to end 0.7 per cent down Tuesday: The S&P/ASX 200 Index lost 30 points to finish at 4,133. On the futures market the SPI is 23 points lower.
Currencies
The Australian Dollar at 8:45AM was buying 98.34, 62.89 Pence Sterling, 75.71 Yen and 72.79 Euro cents.
Economic news
Due out today from the Australian Bureau of Statistics construction work done for September.
Company news
Yesterday shares in Commonwealth Bank of Australia (ASX:CBA) dipped 0.32 per cent, closing at $47.40. Commonwealth Bank has decided to delay its planned covered bond issue in Europe due to heightened market volatility. Last week ANZ Banking Group (ASX:ANZ) became the first Australian bank to complete a covered bond issue from US debt markets, one month after laws were changed enabling banks to offer the debt. In the 2011 financial year Commonwealth Bank posted a net profit of $6.4 billion.
On Tuesday shares in Gunns Limited (ASX:GNS) closed flat at $0.19. John Gay, the former chairman of timber company Gunns, has been charged with insider trading. The charge relates to Mr Gay’s sale of shares worth several million of dollars ahead of Gunns revealing a 98 per cent profit fall in February 2010. Mr Gay is expected to face the charges in court next month. Gunns will hold its annual general meeting in Melbourne tomorrow. In the 2011 financial year Gunns booked a net loss of $355.5 million.
Ex-dividends
No companies are going ex-dividend today. Coming up later this week are Mystate and RHG.
Commodities
Gold is up $21.40 to $US1,700 an ounce for the December contract on Comex.
Silver is up $1.835 to $32.95.
Copper is up $0.035 at $3.34 a pound.
Oil is up $1.09 at $98.01 a barrel for November light crude in New York.
