The Australian shares market is set to follow in the footsteps of Wall Street’s downward spiral today, after US stocks plunged as cautious investors await a wave of corporate results in the US.
US investors seem on edge amid a mounting number of negative pre-announcements by companies, with many wondering if share prices have outpaced earnings potential.
Currencies
The Australian dollar is still pushing higher against the greenback as traders digest the recent disappointing US employment data. At 8:20AM the Aussie was buying $US90.58 cents, 55.29 Pence Sterling, 93.26 Yen and 66.27 Euro cents.
Figures
Wall Street fell sharply in overnight trade: The Dow Jones Industrial Average shed 179 points to close at 16,258, the S&P 500 lost 23 points to close at 1,819 and the NASDAQ dropped 61 points to close at 4,113.
European stocks were upbeat thanks to a rally in banking stocks after regulators agreed to ease the way that a leverage ratio is compiled to avoid squeezing financing for the economy.London’s FTSE added 17 points, Paris gained 13 points and Frankfurt lifted by 37 points.
Asian markets were mixed: Tokyo’s Nikkei added 32 points, Hong Kong’s Hang Seng gained 43 points, but China’s Shanghai Composite dropped 4 points.
The Australian share market ended yesterday’s session lower. The S&P/ASX 200 index fell 20 points to finish at 5,292. On the futures market the SPI is 48 points down.
Company news
Telstra Corporation Limited
(ASX:TLS) CEO David Thodey is defending the sale of 70 per cent of its stake in Sensis to US investment firm Platinum Equity. Telstra is selling the directory arm stake for $454 million, however will post a $150 million accounting loss as a result of the deal. Mr Thodey says the partnership with Platinum Equity would help drive operational efficiencies within the business. Shares in Telstra dropped 0.19 per cent yesterday to close at $5.25.
Leighton Holdings Limited
(ASX:LEI) subsidiary Thiess is making a return to iron ore mining, after winning a $135 million contract from Western Desert Resources Limited
(ASX:WDR) for work at its Roper Bar Project in the Northern Territory. The three-year contract begins on Monday at the Roper Bar project, located about 600kms southeast of Darwin. Shares in Leighton fell 1.1 per cent yesterday to close at $16.20.
Commodities
Gold is up $4.20 to $US1,251 an ounce for the February contract on Comex. Silver is up $0.16 to $20.38 for March. Copper is flat at $3.34 a pound. Oil is down $1.12 at US$91.60 a barrel for February light crude in New York.
