The Australian share market is preparing to extend the weekly decline after Wall Street slumped overnight. Positive US economic news was offset by disappointing Chinese economic news and concerns over Ukraine and Russia. Global investors sold out of stocks ahead of Sunday’s Crimean referendum to join the Russian Federation and amid reports more Russian troops are entering Ukraine.
Safe haven assets were back in favour as the price of gold hit a six-month high. The price of iron ore has rebounded back above $US110 per tonne while the price of copper continues to head lower.
Chinese economic news
Lower than expected retail sales and industrial output figures have stoked fears the world’s second largest economy is slowing down. China's National Bureau of Statistics reports industrial production slowed to 8.6 per cent for January and February against expectations for 9.5 per cent growth. Chinese retail sales slowed to 11.8 per cent against expectations for 13.5 per cent growth.
US economic news
Retail sales rose for the first time in three months. The Commerce Department reports retail sales increased 0.3 per cent in February.
In the US employment market initial jobless claims declined to a three-month low. The Labor Department reports initial unemployment claims fell by 9,000 to 315,000 last week.
Global markets
Wall Street’s major indexes sank more than 1 per cent on Thursday: The Dow Jones Industrial Average dropped 231 points to close at 16,109, the S&P 500 dropped 22 points to close at 1,846 and the NASDAQ dropped 63 points to close at 4,260.
European markets also booked drops of more than 1 per cent yesterday: London's FTSE 100 Index fell 67 points, France's CAC 40 fell 56 points and Germany's DAX fell 171 points.
Asian markets closed mixed yesterday: Japan’s Nikkei lost 14 points, Hong Kong’s Hang Seng lost 146 points, but China’s Shanghai Composite added 21 points.
A surprise jump in the number of Australian jobs created supported the Australian share market yesterday: The S&P/ASX 200 index lifted 28.4 points to finish at 5,413 on Thursday. On the futures market the SPI is currently 58 points down.
Currencies
The Australian dollar has weakened after yesterday’s local jobs report gave it a boost. At 7:20am the Australian dollar was buying $US0.9028, 54.32 Pence Sterling, 91.85 Yen and 65.12 Euro cents.
Economic news due out today
Australian Bureau of Statistics: Housing finance figures for December
Property stocks
Charter Hall Group
(ASX:CHC) has bought a 50 per cent stake in an centrally located Adelaide office building for about $30 million from Aspen Group Limited
(ASX:APZ). The Australian Tax Office building is leased to the Commonwealth Government and also used by Australia Post. Charter Hall says the acquisition is in line with the company’s strategy to target well located, long term leased, institutional quality assets with value add opportunities. The transaction is expected to settle by April 30. Shares in Charter Hall Group rose 0.24 per cent following the announcement to close at $4.11.
Prime Financial Group Limited
(ASX:PFG) has launched a new commercial property fund. The company says the Protus Prime Property Group will be equally owned by property executive and investment manager Paul Toussaint, who is the former CEO of ING Industrial Fund. The fund will target the acquisition and management of a diversified portfolio of industrial properties in major Australian East Coast markets. Shares in Prime Financial Group fell 3.7 per cent following the announcement to close at $0.13.
Ex-dividends
Macquarie Telecom Group Limited
(ASX:MAQ) paying a 12 cent fully franked dividend
Mineral Resources Limited
(ASX:MIN) paying a 30 cent fully franked dividend
Commodities
Gold has risen $1.90 to $US1,372.40 an ounce for the April contract on Comex.
Silver has lost $0.16 to $21.20 for May.
Copper has fallen $0.04 to $2.92 a pound.
Oil has gained $0.21 to $US98.20 a barrel for April light crude in New York.
