Australian shares are set to drop at the open after Wall Street fell to an eight-month low on Friday. The steep falls came on the back of weaker than expected economic data out of China. Industrial production in China grew by 5.4 percent for November, on a year-over-year basis the slowest pace in almost three years. European shares also fell after the release of the data. The Dow Jones dropped about 500 points to its lowest level since early May, and, was led downwards by declines in Apple and Johnson & Johnson.
The oil price was also affected by the production figures, which point to lower fuel demand from China, which is the world’s biggest oil importer.
Local economic news
Today the ABS releases the Overseas Arrivals & Departures publication, and, the Federal Government’s Mid-Year Review is out. On Tuesday the Reserve Bank releases the minutes of the last Board meeting. On Thursday the ABS’s June quarter population estimates, together with the November labour market data are due, and, finally on Friday, jobs data from the ABS is expected.
Wall Street closed lower on Friday: The Dow Jones Industrial Average lost 2 per cent to 24 101 the S&P 500 shed 1.9 per cent to close at 2600 and the NASDAQ lost 2.3 per cent to close at 6911.
European markets closed lower: London’s FTSE shed 0.5 per cent, Paris lost 0.9 per cent and Frankfurt dropped 0.5 per cent.
Asian markets were also lower: Tokyo’s Nikkei dropped 2 per cent, Hong Kong’s Hang Seng lost 1.6 per cent, and China’s Shanghai Composite 1.5 per cent.
Locally, the SPI futures pointing to a fall of 32 points. On Friday the Australian share market closed 60 points lower to 5602.
Rare earths miner, Lynas (ASX:LYC) has hit back at media reports regarding the cost of exporting its Water Leach Purification (WLP) residue from Malaysia. Water leach purification (WLP) is the main residue being produced by Lynas during the rare earths extraction process. The company says recent reports by Malaysian media have quoted estimates for the cost of exporting the residue, which appear to be based on a misquote of the views of an analyst. Lynas says it's not in a position to provide guidance on potential costs associated with exporting WLP but says the estimated costs quoted in media reports are substantially lower than the initial assessments of such costs made by Lynas. The company also asserts that removal of water leach purification (WLP) residue from the country is only needed if all other options fail. Shares in Lynas closed 1.5 per cent lower to $1.60 on Friday.
Inabox Group (ASX:IAB) is going ex dividend to today.
One Australian Dollar at 7:30AM was buying 71.79 US cents, 56.97 Pence Sterling, 81.32 Yen and 63.49 Euro cents.
Iron ore futures are eyeing a gain of 2.1 per cent.
Gold has shed $6 to US$1241 an ounce.
Silver is 22 cents lower at US$14.64 an ounce.
Oil has lost $1.36 to US$51.47 a barrel.