The Australian share market is expected to sink today after US stocks continued to spiral amid growing concerns of a drawn-out government shut down and disappointing economic data.
Some traders say the drop was magnified by technically-driven selling as the S&P 500 broke below 1,680 points.
Investors were also worried as the deadline to raise the nation's borrowing limit closes in.
The US Treasury warned a failure to raise the debt limit and a default could have a catastrophic effect on not just financial markets but also on job creation, consumer spending and economic growth.
US economic news
The purchasing managers index for September missed projections. The reading on the US service sector fell to 54.4 from 58.6 in August.
That followed a report showing initial claims for jobless benefits last week increased to 308,000.
The Labor Department says it won’t issue its all-important September jobs report this week due to the shut-down. An alternate release date has not been scheduled.
Currencies
The Australian dollar is just a touch lower after that US economic data pulled the currency in opposite directions in overnight trade. At 7:30AM the Aussie was buying $US93.95 cents, 58.16 Pence Sterling, 91.39 Yen and 68.99 Euro cents.
Figures
Wall Street was in the red: The Dow Jones Industrial Average lost 137 points to close at 14,996, the S&P 500 dropped 15 points to close at 1,679 and the NASDAQ fell 41 points to close at 3,774.
European markets were mostly lower despite upbeat data on manufacturing activity and retail sales.London’s FTSE gained 12 points, Paris lost 30 points and Frankfurt shed 32 points.
Asian markets were mostly higher after China's official services purchasing managers index for September rose to a six-month high. But Japanese stocks bucked the region's trend, as the Nikkei Stock Average slipped to a four-week low.Tokyo’s Nikkei lost 13 points, Hong Kong’s Hang Seng added 230 points, and China’s Shanghai Composite remained closed for a week-long holiday.
The Australian share market defied offshore leads to close up 0.4 per cent. The S&P/ASX 200 index added 19 points to finish at 5,235. On the futures market the SPI is 30 points down.
Company news
Seven West Media Limited
(ASX:SWM) has promoted the head of its magazines division to chief operating officer as it looks to increase its revenue from new technologies and content. Pacific Magazines chief executive Nick Chan will replace outgoing chief operating officer Rohan Lund, who announced his departure a fortnight ago. Shares in Seven West dipped 0.41 per cent yesterday to close at $2.44.
Commonwealth Bank of Australia
(ASX:CBA) shareholders will be asked to approve a bonus of up to $4 million for chief executive Ian Narev at the bank’s annual general meeting next month. The payment would reportedly be made under the bank’s leadership reward program, which it says is designed to focus the efforts of the bank’s most senior staff. Shares in CBA lifted 0.04 per cent higher yesterday to close at $71.70.
Commodities
Gold is down $3.10 to $US1,317.60 an ounce for the December contract on Comex. Silver is down $0.11 to $21.79 for December. Copper is down $0.05 at $3.27 a pound. Oil is up/down $0.79 at US$103.31 a barrel for November light crude in New York.
Ex-dividend
