The Australian share market looks to retreat this morning after global markets all closed lower, deepening this week’s decline trigged by China cutting its annual growth target. Overnight, investors were hit with news that Europe’s economy has shrunk and increasing concerns over Greece’s debt swap. At home eyes will be on fourth quarter GDP figures, with expectations for a slight softening.
Economic news
The latest figures on European growth have come in weaker than expected. The European Union has reported that the eurozone economy contracted by 0.3 per cent in the last three months of 2011. The EU's Economic Affairs Commissioner confirmed, "The euro area is currently in a mild recession."
Figures
Wall Street retreated yesterday: The Dow Jones Industrial Average lost 201 points to close at 12,762, the S&P500 lost 21 points to close at 1,343 and the Nasdaq lost 40 points to close at 2,910.
European markets also fell on Tuesday: London’s FTSE lost 109 points, Paris lost 125 points and Frankfurt lost 233 points.
Asian markets also finished lower: Hong Kong’s Hang Seng lost 459 points, Tokyo Nikkei lost 61 and China’s Shanghai Composite lost 35 points.
The Australian share market widened losses throughout the session to close 1.4 per cent down on Tuesday: The S&P/ASX 200 Index dropped 58 points to finish at 4,205. On the futures market the SPI is now 59 points down.
Currencies
The Australian Dollar at 8:30AM was buying $US1.0558 cents, 67.17 Pence Sterling, 85.36 Yen and 80.51 Euro cents.
Economic news due out today
Australian Bureau of Statistics: National accounts including gross domestic product figures for the December quarter 2011
Australian Industry Group and Housing Industry Association: Performance of Construction Index for February 2012
Company news
Shares in Fairfax Media Limited (ASX:FXJ) dipped 0.64 per cent yesterday, closing at $0.775. Mining billionaire Gina Rinehart has reportedly asked Fairfax Media for a seat on the board. Mrs Rinehart became the media company’s largest shareholder last month with a 12.58 per cent interest. The news organisation says she is believed to have asked for a seat when visiting Fairfax offices in Sydney yesterday. Mrs Rinehart is a board member of Ten Network Holdings Limited (ASX:TEN) in which she holds a 10.1 per cent stake. Fairfax Media reported a net profit of $97.6 million in the first half of its 2012 financial year.
Shares in Newcrest Mining Limited (ASX:NCM) fell 2.06 per cent on Tuesday, closing at $31.82. Gold producer Newcrest has struck a deal with gold and copper explorer Frontier Resources Limited (ASX:FNT). Newcrest has agreed to pay $750,000 for a 2.3 per cent stake in Frontier. Both companies have also agreed to negotiate the terms of a proposed farm-in by Newcrest into Frontier’s Mt Andewa project in Papua New Guinea. Newcrest could earn a 60 per cent interest in the project by investing $15.25 million in exploration over four years. Newcrest Mining posted a record first half net profit of $684 million.
Ex-dividends
Four companies are going ex-dividend today:
Chandler Macleod Group Limited (ASX:CMG)
Fortescue Metals Group Limited (ASX:FMG)
News Corporation (ASX:NWS)
Reece Australia Limited (ASX:REH)
Commodities
Gold is down $31.80 to $US1,672 an ounce for the April contract on Comex.
Silver is down $0.91 to $32.78 for March.
Copper is down $0.12 at $3.74 a pound.
Oil is down $2.02 at $104.70 a barrel for March light crude in New York.
