The Australian share market is expected to dip today, after US stocks took a breather from the biggest three-day winning streak since the beginning of the year.
US investors have turned their attention to the US Federal Reserve’s policy setting meeting meeting next week, when the Fed is expected to begin tapering its massive bond buying program.
US economic news
That anxiety over the Fed’s next move may have been sparked after the number of new jobless claims fell to the lowest level since 2006 last week. Initial claims for benefits fell to 292,000, well below expectations for a rise to 330,000. However those figures may have been impacted after two states made changes to their computer systems that resulted in some claims not being processed in time.
Figures
Wall Street dipped slightly overnight: The Dow Jones Industrial Average lost 26 points to close at 15,301, the S&P 500 dropped 6 points to close at 1,683 and the NASDAQ fell 9 points to close at 3,716.
European markets were subdued: London’s FTSE gained half a point, Paris lost 12 points and Frankfurt slipped 2 points.
Asian markets also had a mixed session: Tokyo’s Nikkei fell 38 points, Hong Kong’s Hang Seng added 17 points, and China’s Shanghai Composite lifted 14 points.
The Australian share market climbed to a five-year closing high yesterday after the release of the monthly employment report. A fall in job creation last month revived the chance of another interest rate cut, and in turn fuelled market gains. The S&P/ASX 200 index added 8 points to finish at 5,243. On the futures market the SPI is 9 points lower.
Currencies
The Australian dollar has regained some ground after losing more than one US cent on that disappointing jobs data yesterday. At 7:30AM the Aussie was buying $US92.67 cents, 58.64 Pence Sterling, 92.17 Yen and 69.68 Euro cents.
Company news
Fortescue Metals Group Limited
(ASX:FMG) and Brockman Mining Australia Limited
(ASX:BRM) may be about to resolve their stoush after the regulator published a maximum price for access to Fortescue’s port and rail assets. WA’s regulator ruled that the maximum paid by both Fortescue and Brockman for the access should be $316.9 million a year – about 45 per cent less than the maximum Fortescue put forward in May. Shares in Fortescue fell 2.92 per cent yesterday to close at $4.66.
Australian Agricultural Company Limited
(ASX:AAC) is asking investors to get behind a significant equity raising to double its capital base as the company targets an Asian expansion strategy including a move into full-scale meat processing for the export market. Australia's biggest landholder and beef producer has ruled out a split of its $600 million pastoral holdings from the beef production business, promising instead to secure higher and more stable prices for export beef. Shares in Aaco were placed in a halt and last traded at $1.17.
Ex-dividend
Commodities
Gold prices fell to a four-week low as upbeat US jobs data reinforced expectations that the Federal Reserve will pull-back on its bond-buying program. Gold is down $33.20 to $US1,331 an ounce for the December contract on Comex. Silver is down $1.02 to $22.15 for December. Copper is down $0.05 at $3.21 a pound. Oil is up $1.04 at US$108.60 a barrel for October light crude in New York.
