A downturn in resource stocks and news of a contraction in construction helped push the share market into reverse following three days of gains.
At lunchtime the ASX 200 was trading 49 points or 0.9% lower at 5319, but within reach of a second straight weekly advance if it closes above 5313. Industrials +0.3% was the only sector to trade higher. Metals & mining -2.2%, energy -1.9% and materials -1.7% bobbed on top of the sea of red.
The mood among iron ore miners was gloomy after junior MGX shelved plans to reopen its Koolan Island mine following flooding, saying it would have to assess the ore price before proceeding. Shares in the company fell almost 50%.
The declines followed negative sessions in the US and Europe overnight after the European Central Bank delayed launching fresh stimulus measures. A degree of caution was evident ahead of tonight's November jobs report in the US.
“The release of the US jobs figure is likely to dictate caution amongst traders,” Ric Spooner, chief markets analyst at CMC, told Bloomberg. “While the US economy continues to expand at a moderate pace, there has been some patchiness in recent data including consumer confidence, personal spending and durable goods orders. Against that background, markets will be looking for assurance that the momentum of jobs growth is being sustained in the US”
China's Shanghai Composite extended yesterday's 4.3% surge, rising 1.29% this morning. Hong Kong's Hang Seng rallied 0.9% and Japan's Nikkei fell 0.23%. Dow futures were recently down two points or less than 0.1%.
Crude oil futures slid another 24 cents this morning to US$66.57 a barrel. Spot gold was $3.10 weaker at US$1,204.60 an ounce. The dollar was buying 83.86 US cents.
Plenty of room for profit taking on the ASX today following three days of pretty decent gains. Wall Street is starting to look over-extended again. The ECB disappointed and there may be some sell-the-news once the US jobs report is out tonight. Trading: profitable morning, though trades have been few. Traded the first bounce in MGX, timed the exit well and then watched and waited. Thought it would test 19.5c once 20c fell, but it reversed before I could amend my buy order. Ah well. AWE, LNG and SYR have been reliable bouncers lately. Took AWE at $1.23. Still waiting for SYR and LNG. Can't get a clear read on VET yet, Nihilism. LNR is another conundrum - big swings, but the trading pattern is beyond me.
