The Australian share market is set to plunge in early trade, after US stocks tanked following a weak read on Chinese manufacturing.
HSBC’s and Markit’s flash purchasing managers index fell in to contraction territory for the first time in six months in January.
US economic news
US investors were also uninspired by the latest round of corporate earnings reports and economic news.
US jobless claims rose by 1,000 in the latest week, on par with expectations, while sales of existing homes rose one per cent in December after three consecutive months of declines.
Figures
Wall Street fell deep in to the red: The Dow Jones Industrial Average shed 176 points to close at 16,197, the S&P 500 lost 16 points to close at 1,828 and the NASDAQ dropped 24 points to close at 4,219.
European markets also declined, despite business activity, as measured by the purchasing managers index, hitting a 31-month high. London’s FTSE lost 53 points, Paris dropped 44 points and Frankfurt plunged by 89 points.
Asian markets plummeted: Tokyo’s Nikkei shed 125 points, Hong Kong’s Hang Seng tumbled by 348 points, and China’s Shanghai Composite slipped by 10 points.
The Australian share market plunged 1 per cent yesterday – an immediate reaction to soft Chinese manufacturing figures. The S&P/ASX 200 index plunged 57 points to end at 5,263. On the futures market the SPI is 31 points down.
Currencies
The Australian dollar lost ground on that unexpected contraction in Chinese manufacturing activity. At 8:20AM the Aussie was buying $US87.68 cents, 52.72 Pence Sterling, 90.44 Yen and 64.04 Euro cents.
Company news
Coca-Cola Amatil Limited
(ASX:CCL) is shifting part of its juice production operation to Adelaide, with 28 employees to be made redundant in the process. The drinks manufacturer is investing $2.9 million in the expansion of its facility in Adelaide so that it can move part of its juice production from Waikerie in South Australia to the upgraded facility. The company says employees impacted by the move will be offered jobs at other CCA facilities around the country. Shares in Coca-Cola Amatil dropped 0.5 per cent yesterday to close at $12.01.
Analysts are tipping shares in Nine Entertainment Co Holdings Limited
(ASX:NEC) could go as high as $2.42 in the next 12 months, as shares in the recently listed media company reach fresh highs. Media reports say a number of broker notes are offering a positive outlook regarding the share price. Shares in Nine closed 0.93 per cent higher yesterday at $2.17.
Commodities
Gold is up $23.70 to $US1,262 an ounce for the February contract on Comex. Silver is up $0.17 to $20.01 for March. Copper is down $0.05 at $3.29 a pound. Oil is up $0.59 at US$97.32 a barrel for March light crude in New York.
