Outlook: ASX set to drop after US jobs report

Market Reports

The Australian share market looks to drop into the second full week of the year after Wall Street fell following the release of America’s monthly jobs report. Despite better than expected jobs growth US traders focused on soft wages growth, a weaker participation rate and concerns about Europe’s economic prospects. In the week ahead local economic news releases will ramp up with Australia’s own labour report due on Thursday. 

US economic news

Nonfarm payrolls rose more than expected in December and the jobless rate eased quicker than anticipated to a 6.5 year low. The Labor Department reports American employers created 252,000 jobs last month and the unemployment rate decreased by 0.2 per cent to 5.6 per cent. 
Global markets
Wall Street retreated on Friday: The Dow Jones Industrial Average fell almost 1 per cent to close at 17,737, the S&P 500 fell 0.8 per cent to close at 2,045 and the Nasdaq fell 0.7 per cent to close at 4,704.
European markets sank on Friday: London's FTSE 100 declined just over 1 per cent, France's CAC 40 declined 1.9 per cent and Germany's DAX declined 1.9 per cent.
Asian markets ended mixed on Friday: Japan’s Nikkei added 0.2 per cent, Hong Kong’s Hang Seng rose 0.4 per cent, and China’s Shanghai Composite eased 0.2 per cent.
The Australian share market climbed 1.56 per cent on Friday, fueled by strength in the energy sector: The S&P/ASX 200 index gained 84 points on Friday, erasing the weekly loss and gaining 30 points over the week to close at 5,466. On the futures market the SPI is 40 points lower.

The Australian dollar at 8:30am was buying $US0.8205, 54.05 Pence Sterling, 97.16 Yen and 69.28 Euro cents.

Economic news due out today 

Australian Bureau of Statistics: Housing finance figures for November

Reserve Bank of Australia: Credit and debit card lending numbers for November

ANZ Banking Group (ASX:ANZ): Job advertisements data for December 

Company news
Iron ore stocks got a boost as the price of the steel making commodity hit a one-month high last week. Mining and materials company Arrium Limited’s (ASX:ARI) stock gained over the week. Shares in Atlas Iron Limited (ASX:AGO) and BC Iron Limited (ASX:BCI) also enjoyed a lift however all three companies where among the worst performing stocks last year, each with losses of more than 85 per cent. Shares in Arrium dipped 1.69 per cent on Friday to end the week at $0.29. 
Energy stocks were slammed over last week as the price of oil continued to slide, having plunged more than 50 per cent since mid 2014. Over last week Drillsearch Energy Limited (ASX:DLS), Senex Energy Limited (ASX:SXY) and Horizon Oil Limited (ASX:HZN) each lost about 10 per cent. However energy stocks enjoyed a rebound at the end of last week and shares in Drillsearch Energy lifted 2.8 per cent on Friday to end the week at $0.735. 
After gaining more than $US25 over last week the price of gold has lifted $7.60 to $US1,216 an ounce for the February contract on Comex. 
Silver has added $0.03 to $16.42 for March. 
Copper has declined $0.01 to $2.75 a pound. 
Oil has fallen $0.29 to $US48.99 a barrel for February light crude in New York.