The Australian share looks to erase yesterday’s gains after global stocks retreated as doubts emerged over the outcome of last week’s EU Summit. Wall Street widened losses after a profit warning from chipmaker Intel and a renewed call from ratings agency Moody’s to “review European sovereign debt”.
Economic news
Moody’s Investors Service says the EU Summit failed to deliver "decisive policy measures" and the ratings agency will be reviewing the European Union’s credit ratings from the first quarter of next year. Moody’s believes the region remains prone to further shocks and the cohesion of the euro area is under continued threat.
The Organisation for Economic Co-operation and Development’s December report has warned that leading indicators “point to a slowdown in economic activity in all major economies but with some variation” in separate countries.
Figures
Wall Street started the week lower: The Dow Jones Industrial Average fell 163 points to close at 12,021, the S&P500 eased 19 points to close at 1,236 and the Nasdaq lost 35 points to close at 2,612.
European stocks dropped on Monday: London’s FTSE was down 101 points, Paris was down 83 points and Frankfurt was down 201 points.
To Asian markets, and stocks finished mixed: Hong Kong’s Hang Seng was down 11 points, Tokyo Nikkei was up 117 and China’s Shanghai Composite was down 24 points.
The Australian share market advanced throughout the day to start the week 1.18 per cent higher. The S&P/ASX 200 Index gained 50 points to finish at 4,253. On the futures market the SPI is down 64 points.
Currencies
The Australian Dollar at 8:40AM was buying $US1.0075 cents, 64.66 Pence Sterling, 78.47 Yen and 76.39 Euro cents.
Economic news
Due out today from the Australian Bureau of Statistics: Lending finance data for October and dwelling commencements for the September quarter. From National Australia Bank: Monthly business survey for November.
Company news
Shares in Telstra Corporation Limited (ASX:TLS) rose 1.55 per cent yesterday, closing at $3.28. Australia’s biggest telco, Telstra, looks set to tap a new revenue stream by stepping into the video game industry next year, according to The Australian. The paper reports Telstra will introducing a subscription service enabling customers to stream video games direct to their T-Box digital set-top box and also launching a so-called ‘all-you-can-eat’ video and music subscription service. Telstra reported a net profit of $3.25 billion in the 2011 financial year.
Shares in Brockman Resources Limited (ASX:BRM) entered into a trading halt yesterday and last traded at $2.26. The iron ore developer said the trading halt was relating to a potential corporate transaction, and released a statement backing a revised takeover bid from its majority shareholder. Hong Kong investment group Wah Nam International has made a bid for the 47.7 per cent of Brockman that it does not already own. Wah Nam is offering $1.50 cash and 18 of its shares for every Brockman share, giving Brockman an implied value of $3.03 per share. Brockman Resources posted a net loss of $40.8 million in the 2011 financial year.
Ex-dividends
No companies are going ex-dividend today. Coming tomorrow is AWE and later this week, Singapore Telecommunications.
Commodities
Gold is down $48.60 to $US1,668 an ounce for the February contract on Comex.
Silver is down $1.25 to $31 for March.
Copper is down $0.09 at $3.46 a pound.
Oil is down $1.64 at $97.77 a barrel for January light crude in New York.
