After plunging 7.8 per cent since the beginning of September and sinking 2.4 per cent over last week the Australian share market looks set to drop further into the new week. European and US equity markets tumbled on Friday as the International Monetary Fund’s (IMF) downgrade of global growth continued to weigh on sentiment.
In the week ahead attention will be focussed Chinese export and import figures and local loan data today.
Due for release is National Australia Bank Limited’s (ASX:NAB) business survey tomorrow, Westpac Banking Corporation's (ASX:WBC) consumer confidence survey on Wednesday and a speech by US Federal Reserve Chair Janet Yellen on Friday.
Global markets
Wall Street retreated more than 3 per cent over last week and extended falls on Friday: The Dow Jones Industrial Average dropped 0.7 per cent to close at 16,544, the S&P 500 dropped 1.2 per cent to close at 1,906 and the Nasdaq dropped 2.3 per cent to close at 4,276.
European markets tumbled more than 4 per cent over last week and widened losses on Friday: London's FTSE 100 lost 1.4 per cent, France's CAC 40 lost 1.6 per cent and Germany's DAX lost 2.4 per cent.
Asian markets moved lower last week and finished Friday in the red: Japan’s Nikkei declined 1.2 per cent, Hong Kong’s Hang Seng declined 1.9 per cent, and China’s Shanghai Composite declined 0.6 per cent.
The Australian share market sank more than 2 per cent on Friday to post its biggest daily drop since mid-2013: The S&P/ASX 200 index plunged 108 points on Friday, extending the weekly retreat of 130 points to close at 5,188. On the futures market the SPI is 38 points lower.
Currencies
The Australian dollar at 7:25am was buying $US0.8695, 54.09 Pence Sterling, 93.53 Yen and 68.85 Euro cents.
Economic news due out today
Australian Bureau of Statistics: Lending finance figures for August
Reserve Bank of Australia: Credit and debit card lending data also for August
Company news
Shares in Whitehaven Coal
(ASX:WHC) sank to the benchmark’s worst performer on Friday as traders responded to news China will reintroduce import tariffs on coal imports. China's Ministry of Finance says import tariffs for anthracite coal and coking coal are set to return to 3 per cent. Non-coking coal is poised to have an import tax of 6 per cent. Lower thermal and coking coal prices have already hit Australia’s coal sector and resulted in mine closures and job losses. Shares in diversified miners BHP Billiton Limited
(ASX:BHP) and Rio Tinto Limited
(ASX:RIO) also dropped on Friday, with BHP only last month slashing 700 workers from its Queensland metallurgical coal mining business. Shares in Whitehaven Coal sank 8.81 per cent to close at $1.50 on Friday.
Echo Entertainment Group Limited
(ASX:EGP) was one of only six stocks in the S&P/ASX 200 to finish higher on Friday. Reports have since emerged luxury hotels and resorts company Ritz-Carlton is in talks to join the casino owner and operator’s joint venture for the Queen’s Wharf Brisbane development project. Echo Entertainment entered into a memorandum of understanding (MOU) with Hong Kong based Chow Tai Fook Enterprises and Far East Consortium in June. The Destination Brisbane Consortium is aiming to prepare a detailed proposal to develop an entertainment precinct and integrated resort at the site.
Shares in Echo Entertainment Group gained 1.2 per cent to close at $3.38 on Friday.
Ex-dividends
AMA Group Limited
(ASX:AMA) paying a 1.6 cent fully franked dividend
Basper Limited
(ASX:BER) paying a 1.5 cent unfranked dividend
Magellan Flagship Fund Limited
(ASX:MFF) paying a 1 cent unfranked dividend
WAM Active Limited
(ASX:WAA) paying a 4.8 cent fully franked dividend
WAM Research Limited
(ASX:WAX) paying a 3.75 cent fully franked dividend
Commodities
After lifting more than $US10 last week the price of gold has dipped $3.60 to $US1,222 an ounce for the December contract on Comex.
Silver has slipped $0.12 to $17.30 for December.
Copper has eased $0.03 to $3.04 a pound.
Oil has gained $0.05 to $US85.82 a barrel for November light crude in New York.
