The Australian share market is expected to continue its descent in early trade as global investors considered jumbled US economic data and the possibility the Federal Reserve may begin to taper stimulus as early as next week.
US economic news
There was a mixed bag of economic data for investors to digest. Retail sales rose 0.7 per cent in November, a key month that kicks off the important year-end holiday shopping season. Analysts had expected a softer increase of 0.6 per cent.
On the downside, new jobless claims rose to 368,000 in the week ending December 7 from the prior week's upwardly revised figure of 300,000, the Labor Department said.
Currencies
The Australian dollar is at a three-and-a-half month low following strong US retail sales data and after comments from Reserve Bank of Australia governor Glenn Stevens, who said he thought the dollar's natural level was around 85 US cents. At 8:20AM the Aussie was buying $US89.32 cents, 54.64 Pence Sterling, 92.26 Yen and 64.97 Euro cents.
Figures
Wall Street fell deeper in to negative territory: The Dow Jones Industrial Average lost 104 points to close at 15,739, the S&P 500 shed 7 points to close at 1,776 and the NASDAQ dropped 5 points to close at 3,998.
European markets slid overnight. They were shaken by data that suggests the eurozone recovery may be stalling and also by traders adjusting positions ahead of the US Federal Reserve's stimulus decision: London’s FTSE lost 62 points, Paris fell 18 points and Frankfurt lost 60 points.
Asian markets were also down over fears the US Fed may decide to taper: Tokyo’s Nikkei lost 173 points, Hong Kong’s Hang Seng shed 120 points, and China’s Shanghai Composite slipped by one point.
The Australian share market closed lower for a sixth straight session yesterday to finish 0.8 per cent down, hit by losses among energy stocks, the miners and another sell-off in the big banks.
The S&P/ASX 200 index closed 42 points down to finish at 5,063.On the futures market the SPI is 13 points lower.
Economic news
The Australian Bureau of Statistics will release lending finance data for October today.
Company news
The Takeovers Panel is expected to announce today whether Canadian dairy company Saputo needs to increase its bid for Warrnambool Cheese & Butter Factory Co
(ASX:WCB) shares from $9.20 to $9.56 each. The keenly awaited decision follows an application to the Takeovers Panel from rival Victorian bidder, dairy co-operative Murray Goulburn, regarding Saputo's fourth, revised offer of $9.20 a share, made on November 25. Shares in Warrnambool Cheese and Butter Factory lifted 1.31 per cent yesterday to close at $9.27.
Westpac Banking Corp
(ASX:WBC) will hold its annual general meeting today. The update to shareholders comes after the bank’s $1.45 billion purchase of Lloyds Banking Group’s Australian assets was cleared by the ACCC. Shares in Westpac dropped 0.19 per cent yesterday to close at $30.82.
Ex-dividend James Hardie Industries
(ASX:JHX) will pay 8.76 cents per share unfranked.
Commodities
Gold is down $32 to $US1,225 an ounce for the February contract on Comex. Silver is down $0.90 to $19.45 for March. Copper is flat at $3.29 a pound. Oil is up $0.06 at US$97.50 a barrel for January light crude in New York.
