Ahead of the Australia Day public holiday tomorrow, the Australian share market looks poised for a soft start following negative leads and bearish headlines. European and US markets dipped on Greek debt fears amid the nation’s continuing debt negotiations ahead of a payment deadline in March. Choppy conditions look likely to continue for the Australian Securities Exchange with the domestic market awaiting CPI data this morning.
Economic news
The International Monetary Fund has lowered global growth forecast and warned of the increasing risk from Europe’s sovereign debt crisis. The IMF’s World Economic Outlook has forecast the global economy to grow 3.3 per cent this year, down from last year’s forecast of 4 per cent. Europe’s growth is expected to contract 0.5 per cent, down from projected expansion of 1.1 per cent last year. US growth is expected to expand 1.8 per cent this year, in line with last year’s forecast. China’s growth is expected to expand 8.2 per cent this year, down from last year’s forecast of 9 per cent.
Figures
Wall Street closed mixed on Tuesday amid mixed earnings reports: The Dow Jones Industrial Average lost 33 points to close at 12,676, the S&P500 lost 1 point to close at 1,315 and the Nasdaq added 2 points to close at 2,787.
European markets fell yesterday: London’s FTSE was down 31 points, Paris was down 16 points and Frankfurt was down 17 points.
Asian markets: Hong Kong’s Hang Seng and China’s Shanghai Composite were closed for public holidays. In Japan, Tokyo's Nikkei rose 19 on Tuesday.
After starting higher, the Australian share market pulled on Tuesday to end in the red: The S&P/ASX 200 Index eased almost 1 point to finish at 4,224. On the futures market the SPI is 4 points higher.
Currencies
The Australian Dollar at 8:20AM was buying $US1.048 cents, 67.41 Pence Sterling, 81.5 Yen and 80.49 Euro cents.
Economic news due out today
Australian Bureau of Statistics: Consumer price index for December quarter 2011
Westpac Banking Corporation (ASX:WBC) and the Melbourne Institute: Leading indexes of economic activity
Company news
Shares in National Australia Bank Limited (ASX:NAB) dipped 0.55 per cent on Tuesday, finishing at $23.72. The gap between banking customer satisfaction ratings is closing with NAB knocking ANZ Banking Group (ASX:ANZ) off the top spot for the first time in almost 10 years. Roy Morgan Research has reported NAB's satisfaction rating increased to 78 per cent in December, beating ANZ who were rated at 77.9 per cent. NAB’s ''break-up'' campaign has been praised for the increase in customer satisfaction. In third place came Commonwealth Bank of Australia (ASX:CBA) with a 77.5 per cent satisfaction rating followed by Westpac Banking Corporation (ASX:WBC) with a rating of 76.4 per cent. The NAB posted a net profit of $5.2 billion in fiscal 2011.
Shares in Monadelphous Group Limited (ASX:MND) fell 1.33 per cent yesterday, finishing at $21.52. After the market closed the engineering group provided updated first half earnings and profit guidance. Sales revenue is expected to have now grown 24 per cent to $870 million in the six months to the end of December 2011. Net profit is expected to have jumped up to 27 per cent in the same period, up to $58 million. Monadelphous says strong revenue momentum is expected to continue and second half sales revenue is likely to be similar to the first half. Final first half results will be released on February 21, 2012. Monadelphous Group recorded a net profit of $95 million in fiscal 2011.
Ex-dividends
Three companies are going ex-dividend today: Eldorado (ASX:EAU), Ozgrowth Limited (ASX:OZG) and Westoz Investment Company Limited (ASX:WIC). Coming up on Friday: Djerriwarrh Investments Limited (ASX:DJW).
Commodities
Gold is down $13.80 to $US1,664 an ounce for the February contract on Comex.
Silver is down $0.30 to $31.98 for March.
Copper is up $0.01 at $3.81 a pound.
Oil is down $0.63 at $98.95 a barrel for March light crude in New York.
