Following steep falls at the end of last week the Australian share market looks to widen losses after America’s monthly jobs report disappointed, despite showing solid growth. Wall Street dropped as the US Department of Labor showed the American economy added less jobs than expected last month and the jobless rate ticked higher. With global markets extending falls talk of a potential correction gained momentum, fuelled by fears in hot spots such as Argentina, Russia and Ukraine and the Middle East. Coming up over the week the Reserve Bank of Australia is expected to again keep rates on hold at its August board meeting tomorrow and local reporting season will ramp up.
US economic news
America’s monthly jobs report showed its sixth straight monthly creation of more than 200,000 jobs, though the pace of hiring slowed last month. The Department of Labor reported non-farm payrolls rose by 209,000 in July, lower than the 230,000 jobs expected. The unemployment rate rose to 6.2 per cent and missed expectations for a steady read of 6.1 per cent.
Global markets
Wall Street retreated 2.7 per cent over last week and ended Friday in the red: The Dow Jones Industrial Average fell 0.4 per cent to close at 16,493, the S&P 500 fell 0.3 per cent to close at 1,925 and the Nasdaq fell 0.4 per cent to close at 4,353.
European markets tumbled 3.5 per cent over last week and finished down on Friday: London's FTSE 100 dropped 0.8 per cent, France's CAC 40 dropped 1 per cent and Germany's DAX dropped 2.1 per cent.
Asian markets firmed over last week, with Japan rising 0.4 per cent and China jumping 2.8 per cent, despite falls on Friday: Japan’s Nikkei declined 0.6 per cent, Hong Kong’s Hang Seng dipped 0.9 per cent, and China’s Shanghai Composite slipped 0.7 per cent.
The Australian share market sank 1.4 per cent on Friday to erase the weekly gain: The S&P/ASX 200 index sank 77 points on Friday and 27 points over the week at end at 5,556. On the futures market the SPI is 26 points lower.
Currencies
The Australian dollar at 7:30am was buying $US0.9313, 55.36 Pence Sterling, 95.49 Yen and 69.37 Euro cents.
Economic news due out today
Australian Bureau of Statistics: Retail trade for June
ANZ Banking Group
(ASX:ANZ): Job advertisements series for July
Company news
Ahead of Rio Tinto Limited’s
(ASX:RIO) first half results this Thursday the global miner has launched plans for a Mining Training Centre in the Northern Territory. The company and Northern Territory's Aboriginal Gumatj Corporation will established the centre in Northeast Arnhem Land with Rio Tinto investing $2.4 million into the venture. Rio Tinto says it is working to increase the level of Indigenous participation in the workforce at its Gove bauxite mine located east of Darwin. Shares in Rio Tinto fell 1.48 per cent on Friday to end the week at $65.40.
Australia’s largest telco Telstra Corporation Limited
(ASX:TLS) will be paying close attention to the competition regulator’s inquiry into the wholesale cost of mobile calls and texts. The Australian Competition and Consumer Commission (ACCC) recently found prices mobile operators were charging each other to receive mobile calls and SMS messages were too high. Australia's competition regulator will now try to determine how these services should be priced to promote competition in retail markets and benefit consumers. Shares in Telstra Corporation fell 0.91 per cent on Friday to end the week at $5.44.
Commodities
After losing almost $US30 over last week the price of gold has gained $12 to $US1,295 an ounce for the December contract on Comex.
Silver has eased $0.04 to $20.37 for September.
Copper has dipped $0.01 to $3.21 a pound.
Oil has slipped $0.29 to $US97.88 a barrel for September light crude in New York.
