The Australian share market looks set to open in the red and extend yesterday’s 2 per cent decline. Global stocks took a tumble on fears of a slowdown in China and debt concerns in Europe, heightened by signs German bonds are in low demand. Commodity prices have eased and the Australian dollar has dropped to a seven-week low.
Economic news
Data out from China yesterday afternoon has shown the nation’s manufacturing activity dropped to its lowest level since March 2009. The preliminary HSBC purchasing managers' index fell from 51 in October to 48 in November, dipping below the 50 mark that separates expansion from contraction. The final figure will be announced on December 1, 2011.
Figures
Wall Street finished down on Wednesday: The Dow Jones Industrial Average dropped 236 points to close at 11,258, the S&P500 fell 26 points to close at 1,162 and the Nasdaq retreated 61 points to close at 2,460.
European stocks finished lower on Wednesday: London’s FTSE was down 67 points, Paris was down 48 points and Frankfurt was down 80 points.
To Asian markets, stocks were also down: Hong Kong’s Hang Seng was down 387 points, Tokyo Nikkei was down 34 and China’s Shanghai Composite down 18 points.
On Wednesday the Australian share market extended losses to end 2 per cent down: The S&P/ASX 200 Index shed 82 points to close at 4,051. On the futures market the SPI is 25 points down.
Currencies
The Australian Dollar at 8:40AM was buying 96.91 US cents, 62.42 Pence Sterling, 74.96 Yen and 72.63 Euro cents.
Company news
On Wednesday shares in Fortescue Metals Group Limited (ASX:FMG) fell 6.12 per cent, finishing at $4.60. Fortescue’s plans to expand in the Pilbara region of Western Australia could to be threatened with possible state and federal government intervention. Indigenous groups claim the iron ore miner’s Solomon Hub project is damaging sacred sites. The traditional owners have called on the government to use emergency powers to intervene. According to media reports Fortescue has rejected the claims and threatened to launch legal action against the state Registrar of Aboriginal Sites. Fortescue Metals Group posted a net profit of $952 million in the 2011 financial year.
Shares in Murchison Metals Limited (ASX:MMX) last traded at $0.275, entering into a trading halt on Monday. Murchison Metals extended its suspension of trade until today, telling the market it requires more time to continue talks in regards to selling its interest in Crosslands Resources and the $6 billion Oakajee Port and Rail project. The troubled Oakajee Port and Rail project has suffered a number of cost blow outs. West Australian Premier Colin Barnett says, "There's no doubt the capital cost is too high". Murchison is expected to update the market this morning ahead of holding its annual general meeting in Perth today. Murchison booked a net loss of $16.5 million in the 2011 financial year.
Ex-dividends
Mystate is going ex-dividend today with a $0.14 fully franked dividend. Coming up tomorrow is RHG.
Commodities
Gold is down $6.50 to $US1,696 an ounce for the December contract on Comex.
Silver is down $1.067 to $31.88.
Copper is down $0.054 at $3.28 a pound.
Oil is down $1.84 at $96.17 a barrel for November light crude in New York.
