The Australian share market looks set to fall again at open after negative offshore leads stemming from continued concern surrounding the looming US fiscal cliff standoff.
US economic news
The fiscal cliff is estimated to be around 4 to 5 per cent of America’s GDP, with the Congressional Budget Office saying the US economy would shrink by 0.5 per cent in 2013 and unemployment would reach 9.1 per cent if the automatic tax increases and spending cuts come to fruition in January.
European economic news
The European Central Bank has held its main interest rate at 0.75 per cent, deferring any cuts in borrowing costs as it reviews the extent of the Euro zone’s economic downturn.
Figures
Wall Street closed lower yesterday: The Dow Jones Industrial Average lost 121 points to close at 12,811, the S&P500 dropped 17 points to close at 1,378 and the Nasdaq lost 42 points to close at 2,896.
European markets also closed down: London’s FTSE lost 16 points, Paris shed 2 and Frankfurt dropped 28 points.
Asian markets were also lower: Hong Kong’s Hang Seng lost 533 points, Tokyo’s Nikkei dropped 136 and China’s Shanghai Composite is down by 34 points.
The Australian share market closed lower yesterday: The S&P/ASX 200 Index closed 33 points lower to finish at 4,484. On the futures market the SPI is 40 points down.
Currencies
The Australian Dollar at 8:15AM was buying $US1.04 cents, 65.12 Pence Sterling, 82.62 Yen and 81.63 Euro cents.
Economic News
Due out later today from the Reserve Bank of Australia is its statement on monetary policy.
Company news
Telstra Corporation Limited (Public, ASX:TLS) has reportedly made a formal entry into the purchase process for Leighton Holdings Limited’s (ASX:LEI) telco assets, valued at $1 billion. According to Fairfax reports, Telstra’s main interests centre around managed services providers Infoplex and data business Metronode, with Leighton open to offloading assets individually or as a package. Shares in Telstra closed 0.72 per cent lower yesterday at $4.11.
Specialty Fashion Group Limited (ASX:SFH) has seen single digit comparable sales growth and gross margin improvements in the first four months of fiscal 2013. CEO Gary Perlstein says while the figures are an improvement on a disappointing 2012, consumers are too fickle to predict improved trading conditions in the short term, being susceptible to economic or political shocks that may occur. Shares in Specialty Fashion Group closed 6.19 per cent up yesterday at $0.60.
Ex-dividends
National Australia Bank Limited (ASX:NAB) with a 90 cent fully franked dividend.
Tamawood Limited (ASX:TWD) with a 13 cent full franked dividend.
Westpac Banking Corporation (ASX:WBC) will pay an 84 cent dividend, also fully franked.
Commodities
Gold is up $12.00 to $US1,726 an ounce for the December contract on Comex.
Silver is up $0.57 to $32.24 for December.
Copper is up $0.03 at $3.47 a pound.
Oil is up $0.65 at US$85.09 a barrel for December light crude in New York.
