The Australian share market is expected to have a cautious start to the new financial year as global markets ended the trading week lower.
The ASX begins the new financial year in a strong position after climbing 17.3 per cent in the year to the end of June - the strongest gains we’ve seen since before the global financial crisis. Despite the market volatility last week, the gains last year were the third fastest for the Australian share market since 1987.
Currencies
The Australian dollar hit a fresh three-year low over the weekend, plunging to 91.13 US cents on renewed speculation about the US Fed tapering its stimulus efforts. At 7:20AM The Aussie was buying $US91.27 cents, 60.06 Pence Sterling, 90.60 Yen and 70.18 Euro cents.
Figures
Wall Street was mostly in negative territory on Friday: The Dow Jones Industrial Average lost 115 points to close at 14,910, the S&P500 fell 7 points to close at 1,606 and the Nasdaq added 1 point to close at 3,403.
European markets followed suit: London’s FTSE lost 28 points, Paris shed 23 points and Frankfurt was down by 32 points.
Asian markets bucked the trend, moving sharply higher on local economic news: Tokyo’s Nikkei added 464 points, Hong Kong’s Hang Seng lifted 363 points, and China’s Shanghai Composite jumped by 29 points.
The Australian share market finished slightly lower after a high-volume trading session on Friday. The S&P/ASX 200 lost 9 points, chipping in to the weekly gain of 64 points to finish at 4,803.
On the futures market the SPI is 7 points down.
Economic news
There’s no major economic news out today, but the RBA will release its commodity prices index for June and PMI for June is also out today.
Company news
Leighton Holdings Limited
(ASX:LEI) has been told by major shareholder Hochtief that it has increased to 54.96 per cent and plans to purchase more shares, according to media reports. Hochtief has reportedly told Leighton it intends to keep the contractor as an ASX-listed company but has not specified by how much it plans to lift is stake. Shares in Leighton dropped 2.2 per cent on Friday to close at $15.45.
BHP Billiton Limited
(ASX:BHP) says it will run a tighter iron ore business as demand slows down. The mining giant's iron ore president Jimmy Wilson says the business is looking to improve efficiencies, effectiveness and productivity , while maintaining a hiring freeze. Shares in BHP closed down 0.32 per cent on Friday to close at $31.37.
Ex-dividend
Collins Foods Limited
(ASX:CKF) will pay 5.5 cents per share fully franked
Graincorp Limited
(ASX:GNC) will pay 25 cents per share fully franked
ING Private Equity Access Limited
(ASX:IPE) will pay 3.5 cents per share fully franked
Programmed Maintenance Services Limited
(ASX:PRG) will pay 10 cents per share fully franked
Commodities
Gold surged more than 2 per cent on Friday on end-of-quarter short-covering, but bullion still posted its largest quarterly loss in at least 45 years amid fears the US Federal Reserve may wind down its stimulus program. Gold added $34.80 to $US1,235 an ounce for the August contract on Comex. Silver is up $0.92 to $19.60 for September. Copper is up $0.01 at $3.05 a pound. Oil is down $0.49 at US$96.56 a barrel for August light crude in New York.
