The Australian sharemarket is set to open lower this morning. Economists are warning of a full-blown break-up of the euro zone with European leaders gathering to work out how to save the single currency.
European economic news
The Bank of England has held its key interest rate at a record low of 0.50 per cent, where it has stayed for almost three years.
The European Central Bank has cut its own interest rate by 25 basis points to a record low of 1.00 per cent.
US economic news
Initial jobless claims have fallen to a nine month low last week, dropping by 23,000 to 381,000.
The figures
The Dow Jones Industrial Average dropped 199 points to close at 11,998, the S&P500 fell 27 points to close at 1,234 and the Nasdaq lost 53 points to close at 2,596.
European stocks closed lower: London’s FTSE was down 63 points, Paris fell 80 points and Frankfurt lost 120 points.
To Asian markets, stocks also finished lower: Hong Kong’s Hang Seng fell 133 points, Tokyo’s Nikkei dropped 58 points and China’s Shanghai Composite lost 3 points.
The Australian share market closed lower on Thursday. The S&P/ASX 200 Index fell 12 points to close at 4,281. On the futures market the SPI is currently 67 points weaker.
Currencies
The Australian Dollar at 8:40AM is buying $1.017 US cents, 65.05 Pence Sterling, 79.06 Yen and 76.21 Euro cents.
Company news
Yesterday shares in Westpac Banking Corporation (ASX:WBC) closed 0.37 per cent lower at $21.53. Westpac is the last of the big four banks to pass on the Reserve Bank’s rate cut. Australia and New Zealand Banking Group (ASX:ANZ) was the first to pass on the full cut of 25 basis points, followed shortly by National Australia Bank Ltd (ASX:NAB) and then the Commonwealth Bank of Australia (ASX:CBA). Westpac’s new standard variable home loan rate will be 7.36 per cent from December 19. NAB has the lowest standard variable home loan rate, at 7.22 per cent. Westpac reported a net profit of $7.1 billion in the 2011 financial year.
Yesterday shares in Qantas Airways Limited (ASX:QAN) closed steady at $1.62. The airline says its plans to start an ultra-premium airline in south-east Asia have not been affected by potential partner Malaysia Airlines launching its own premium airline. That’s according to a Fairfax Media report. Qantas has set early February as the deadline to release plans for an airline based in KL as part of a joint venture with Malaysia Airlines. In the 2011 financial year Qantas reported a net profit of $249 million.
Ex-dividends
There are three companies going ex-dividend today. They are Australian Masters with a $1.11 fully franked dividend, Metcash $0.115 fully franked, and Troy Resources $0.06 fully franked.
Commodities
Gold is down $31.40 to $US1,713 an ounce for the February contract on Comex. Silver has fallen $1.09 to $31.54 for March. Copper has dropped by $0.06 at $3.50 a pound. Oil is down $2.15 at $98.34 a barrel for January light crude in New York.
