After gaining more than 2.5 per cent over last week Australian stocks look set for a lower start to this week after global markets dragged on Friday. Wall Street investors snapped three days of gains at the end of last week amid mixed company reports and simmering European debt concerns as fears of a potential Spanish bailout were re-ignited.
Figures
Wall Street lifted over last week but fell on Friday: On its last trading day of the week the Dow Jones Industrial Average lost 121 points to close at 12,823, the S&P500 lost 14 points to close at 1,363 and the Nasdaq lost 41 points to close at 2,925.
European markets also dropped at the end of last week: London’s FTSE lost 62, Paris lost 70 and Frankfurt lost 128.
Asian markets on closed mixed on Friday: Hong Kong’s Hang Seng added 82, Tokyo’s Nikkei lost 126 and China’s Shanghai Composite lost 16 points.
The Australian share market posted a soft end to a strong week. The S&P/ASX 200 index lost 8 points on Friday but gained 117 points over the week to finish at 4,199. On the futures market the SPI is now 21 points lower.
Currencies
The Australian Dollar at 7:15AM was buying $US1.037 cents, 66.41 Pence Sterling, 81.29 Yen and 85.51 Euro cents.
Economic news out today
Australian Bureau of Statistics: Producer price index for the June quarter
Company news
Eyes will be on the supermarket giants this week with both Woolworths Limited (ASX:WOW) and Wesfarmers Limited (ASX:WES) owned Coles reporting annual sales figures. Analysts have forecast Coles is set to outperform its rival Woolies in comparable sales growth. A UBS analyst says Coles share of supermarket sales grew 0.68 percentage points in the fourth quarter, beating Woolies who’s share slipped by 0.13 percentage points in the same period. Shares in Woolworths eased 1 per cent on Friday, ending the week at $27.62.
Virgin Australia Holdings Limited (ASX:VAH) CEO John Borghetti says competition for business class market share has seen ticket prices drop by 25 per cent and they could fall further. Speaking to ABC TV Mr Borghetti said there was no competition at the top end since Ansett stopped flying which is when Virgin entered the market to capture the corporate share. Mr Borghetti says Virgin is comfortable with how much fares have dropped now but will also remain competitive if fares drop further. Shares in Virgin Australia Holdings lifted 1.28 per cent on Friday, finishing the week at $0.395.
Ex-dividends today
Countplus Limited (ASX:CUP) with a 3 cent fully franked dividend
Ex-dividends Thursday
Century Australia Investments Limited (ASX:CYA) with a 1.4 cent fully franked dividend
Commodities
Gold is up $2.40 to $US1,582 an ounce for the August contract on Comex.
Silver is up $0.09 to $27.30 for September.
Copper is down $0.10 at $3.45 a pound for September.
Oil is down $0.95 at $91.70 a barrel for August light crude in New York.