The Australian share market looks set to regain some of its losses today, after US stocks shot up on the back of positive economic data, despite Japan’s index plunging into bear market territory.
The Nikkei fell by 6.4 per cent, with investors fleeing the market after the Bank of Japan’s decision to refrain from any more monetary easing measures.
But that was overlooked in the US, as better than expected retail sales data put a halt to a three-day slide.
US economic news
Retail sales in the US grew by 0.6 per cent in May, up from the modest 0.1 per cent rise for the month earlier. The gain was due to a jump in spending at car dealerships.
Figures
Wall Street ended the session more than one per cent higher: The Dow Jones Industrial Average gained 181 points to close at 15,176, the S&P 500 added 24 points to close at 1,636 and the NASDAQ was up by 45 points to close at 3,445.
European markets were mixed: London’s FTSE added 5 points, Paris gained 4 points but Frankfurt lost 48 points.
Asian markets nosedived: Tokyo’s Nikkei plummeted by 844 points, Hong Kong’s Hang Seng shed 468 points, and China’s Shanghai Composite lost 61 points.
Currencies
Meantime the Australian dollar has hit a one-week high, rising overnight after Tokyo's Nikkei lost more than six per cent and the US dollar hit its lowest point against the yen in nearly three months.At 7:20AM the Aussie was buying $US96.49 cents, 61.39 Pence Sterling, 92.04 Yen and 72.17 Euro cents.
A better than expected jobs report was not enough to haul the Australian share market out of the red yesterday. The S&P/ASX 200 index shed 29 points by session’s end to finish at 4,696.
On the futures market the SPI is 58 points higher.
Company news
Rio Tinto Limited
(ASX:RIO) has written $592 million off its Tiwai Point aluminium smelter in New Zealand, cutting its value to $14.8 million. The smelter's future is uncertain as Rio seeks to sell it as part of a clutch of ageing aluminium production assets, packaged for sale as Pacific Aluminium. Shares in Rio Tinto sank 2.39 per cent yesterday to close at $51.57.
Newcrest Mining Limited
(ASX:NCM) will meet with Papua New Guinea Prime Minister Peter O'Neill next week to talk about the company's $6 billion asset writedown. The writedowns will mainly impact Newcrest’s Lihir gold mining operations in PNG's Hidden Valley and Mr O’Neil has publicly offered the gold miner assistance to limit the fallout. Shares in Newcrest continued to tumble yesterday, closing 4.36 per cent down at $11.41.
Ex-dividend Ironbark Capital Limited
(ASX:IBC) will pay 2 cents per share fully franked.
Commodities
Gold fell $14.20 to $US1,378 an ounce for the August contract on Comex. Silver is down $0.21 to $21.58 for July. Copper is $0.04 lower at $3.18 a pound. Oil is up $0.81 at $US96.69 a barrel for July light crude in New York.
