The Australian share market dropped 0.4 per cent over the day and 0.2 per cent over a week marked by increasing fears the US Federal Reserve will start to wind back its stimulus program as soon as next month. Tapering concerns have supported the US dollar but put pressure on commodity prices, dragging the mining sector to the session’s worst performer.
The spotlight now turns to the US October jobs report due this evening amid expectations the American economy added 130,000 jobs over the month impacted by a government shutdown. The unemployment rate is predicted to lift to 7.3 per cent from September's near five-year low of 7.2 percent.
Australia will see business and consumer sentiment surveys and housing finance data released next week.
Figures
The S&P/ASX 200 index lost 21 points today, widening the weekly loss of 10 points to finish at 5,401.
The value of trades was $4.6 billion on volume of 712 million shares at the close of trade.
The top three stocks by value were Fortescue Metals Group Limited
(ASX:FMG), Westpac Banking Corporation
(ASX:WBC) and Commonwealth Bank of Australia
(ASX:CBA).
On the futures market the SPI is 19 points lower.
Wall Street
US markets have had a bumpy ride this week: The Dow Jones Industrial Average has added 48 points, the S&P 500 Index has lost 9 points, the Nasdaq has lost 62 points and the 100 Index has lost 56 points.
Economic news
Australia’s central bank has left the door open for future rate cuts after downgrading its growth forecast for the year ahead on the back of a substantial fall in mining investment and a high local currency. The Reserve Bank of Australia’s quarterly statement on monetary policy lowered the gross domestic product (GDP) forecast for the 2014 calendar year to between 2 per cent and 3 per cent, down from between 2.5 per cent to 3.5 per cent forecast in August.
China’s export results bounced back last month. The China Customs Bureau reports exports jumped 5.6 per cent in October, beating expectations for a 0.3 per cent gain. China’s imports came in at an annual rate of 7.6 per cent, coming in slightly below expectations.
Company news
Qantas Airways Limited’s
(ASX:QAN) stock took off after announcing it will close its Avalon heavy maintenance facility near Melbourne in March 2014. Around 300 jobs are expected to be axed from the facility which services the airline's soon-to-be retired Boeing 747s. Australia’s largest airline made the call after a review concluded there is no workable solution to operate the facility into the future. Shares in Qantas Airways lifted 2.04 per cent today, ending the week at $1.25.
Investors sold out of Echo Entertainment Group Limited
(ASX:EGP) as the gaming company’s annual general meeting was held in Sydney today. CEO John Redmond told shareholders Echo plans to inject $1.5 billion into redeveloping its Queensland casinos in an effort to court high-rollers. Mr Redmond also revealed the new financial year has produced marginal earnings growth in the face of new costs and gaming levies. Shares in Echo Entertainment Group dropped 3.92 per cent today, ending the week at $2.45.
Commonwealth Bank of Australia’s
(ASX:CBA) Chairman David Turner spruiked a stronger economic outlook for the year ahead at the bank’s annual general meeting in Sydney today. The bank’s stock has hit record highs this year and Mr Turner says rising business confidence and lower market volatility supports an optimistic outlook into 2014. Shares in Commonwealth Bank eased 0.28 per cent today, ending the week at $79.10.
ANZ Banking Group
(ASX:ANZ) has kept its home mortgage rates steady today just days after the Reserve Bank of Australia's (RBA) Melbourne Cup rate day decision kept Australia’s key cash rate on hold. ANZ’s has maintained its standard variable rate at 5.88 per cent per annum while the RBA kept rates at a record low of 2.5 per cent on Tuesday. Shares in ANZ rose 1.02 per cent today, ending the week at $32.71.
Best and worst performers
The best performing sector was consumer staples, putting on 23 points to close at 10,160.
The worst performing sector was materials, retreating 99 points to close at 10,054 points.
The best performing stock in the S&PASX 200 was Linc Energy Limited
(ASX:LNC), gaining 5.38 per cent to close at $1.37. Shares in Paladin Energy Limited
(ASX:PDN) and Sirius Resources N.L.(ASX:SIR )also closed higher.
The worst performing stock was St. Barbara Limited
(ASX:SBM), sagging 7.14 per cent to close at $0.33. Shares in Fortescue Metals Group Limited
(ASX:FMG) and JB Hi-Fi Limited
(ASX:JBH) also closed lower.
Commodities
Gold buying $US1,310 an ounce, down $15.63 over the week.
Light crude is $0.60 lower at $US64.20 a barrel.
The Australian dollar
The Australian dollar is buying $US94.64 cents, slightly down over the week.
