The Australian share market looks set for a steady start to the day ahead of Chinese data, including fourth quarter GDP figures, due later in the session. The SPI is tipping modest gains after European markets were encouraged by the sale of French debt following S&P’s credit downgrades. US markets were closed on Monday for the Martin Luther King Jr public holiday. At home the miners will be in focus with quarterly reports due from Fortescue Metals Group Limited (ASX:FMG) and Rio Tinto Limited (ASX:RIO).
Economic news
Following the credit downgrade of nine eurozone nations on Friday, Standard and Poor’s has downgraded Europe’s bailout fund the European Financial Stability Facility’s long-term credit rating by one notch, from AAA to AA+. The downgrade could impact the bailout funds capacity to provide bailout funds.
Figures
Wall Street was closed on Monday for a public holiday after finishing lower on Friday, but notching up its second straight weeks of gains.
European markets started the week stronger: London’s FTSE was up 21 points, Paris was up 29 points and Frankfurt was up 77 points.
Asian markets finished lower on Monday: Hong Kong’s Hang Seng was down 192 points, Tokyo Nikkei was down 122 and China’s Shanghai Composite was down 38 points.
The Australian share market dropped 1.16 per cent on Monday: The S&P/ASX 200 Index shed 49 points to finish at 4,147. On the futures market the SPI is now 9 points higher.
Currencies
The Australian Dollar at 8:35AM was buying $US1.031 cents, 67.3 Pence Sterling, 79.24 Yen and 81.42 Euro cents.
Economic news
Due out today: Australian Bureau of Statistics lending finance data for November.
Company news
Shares in Rio Tinto Limited (ASX:RIO) eased 0.49 per cent on Monday, closing at $64.89. The global miner is expected to today release its fourth quarter operations review and analysts are tipping a strong result. The Port Hedland Port Authority in Western Australia posted record iron ore shipments for the end of last year. However, analysts will also be looking at how last year’s sharp fall in iron ore prices impact the miner’s earnings. Fortescue Metals Group Limited’s (ASX:FMG) second quarter production report is also due today, while BHP Billiton Limited’s (ASX:BHP) second quarter production report and OZ Minerals Limited’s (ASX:OZL) fourth quarter production report are due tomorrow. In the first half of the 2011 calendar year Rio Tinto reported a net profit of $7.5 billion.
Shares in FKP Property Group (ASX:FKP) jumped 10.71 per cent yesterday, closing at $0.62. The gain saw the real estate company close as the top 200’s best performer of the day, after speculation emerged it’s in talks to sell its $1 billion retirement village portfolio. Responding to a price query from the Australian Securities Exchange, FKP Property says it knows of no information that has not been announced to explain its recent share price jump. FKP has also advised it is aware of the speculation and has held talks on restructuring its retirement portfolio, but none of these talks have progressed to a level which it believes require disclosure. In the 2011 financial year FKP Property Group reported a net profit of $90 million.
