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The Australian share market looks to be set for a weak start after last week booking its biggest weekly decline since early February. Though Wall Street rose heading into the weekend escalating conflict in Iraq over the weekend could hurt investor sentiment over today’s session. The miners look poised for more pain with the iron ore price continuing to retreat while energy stocks could be supported by stronger oil prices. This week will be all about Central Banks with Australia’s Reserve Bank releasing its June board meeting minutes tomorrow and America’s US Federal Reserve meeting on Wednesday.
Global markets
Wall Street snapped a month of weekly gains and shed 0.7 per cent over last week but firmed on Friday: The Dow Jones Industrial Average added 42 points to close at 16,776, the S&P 500 added 6 points to close at 1,936 and the Nasdaq added 13 points to close at 4,311.
European markets lost about 0.5 per cent over last week and extended losses on Friday: London's FTSE 100 lost 65 points, France's CAC 40 lost 11 points and Germany's DAX lost 26 points.
Most Asian markets rose over last week and stayed strong on Friday: Japan’s Nikkei gained 124 points, Hong Kong’s Hang Seng gained 144 points, and China’s Shanghai Composite gained 19 points.
The Australian share market fell 1.1 per cent over last week shorted by the Queen’s Birthday Public Holiday: The S&P/ASX 200 index fell 24 points on Friday, widening the weekly loss of 59 points to finish at 5,405. On the futures market the SPI is pointing 1 point higher.
Currencies
The Australian dollar last week hit a seven-month high above $US0.94 but at 7:20am has pulled back against the greenback from Friday’s close and is buying $US0.9404, 55.43 Pence Sterling, 95.93 Yen and 69.49 Euro cents.
Economic news due out today
Housing Industry Association: State and national outlook, Autumn edition
Last week’s winners and losers
The resources sector fell to last week’s worst performer as weak iron ore prices weighed on Australia’s biggest miners. BC Iron Limited (ASX:BCI) was the top 200’s worst performing stock with a decline of more than 15 per cent over the week while Fortescue Metals Group Limited (ASX:FMG) fell about 10 per cent. The major miner’s BHP Billiton Limited (ASX:BHP) and Rio Tinto Limited (ASX:RIO) also lost ground over the week. Engineering company Downer EDI Limited (ASX:DOW) shed almost 15 per cent over the week after BHP Billiton terminated a $360 million coalmine contract. Last week’s worst performer BC Iron dropped 7.83 per cent on Friday, extending the weekly fall of 15.7 per cent to end at $3.06.
Gold miners gained over last week led by Evolution Mining Limited (ASX:EVN) after scoring exploration permits for three tenements in Queensland. Escalating conflict in the Middle East pushed up the spot price for gold over a week in which global equity market’s mainly declined. Australia’s largest listed gold miner Newcrest Mining Limited (ASX:NCM) firmed over the week while smaller goldminers Northern Star Resources Limited (ASX:NST) and Silver Lake Resources Limited (ASX:SLR) were also stronger. Last week’s best performer Evolution Mining rose 3.68 per cent on Friday, extending the weekly gain of more than 11 per cent to end at $0.845.
Ex-dividends today
Eumundi Group Limited (ASX:EBG) paying a 0.5 cent fully franked dividend
Ex-dividends tomorrow
Thorn Group Limited (ASX:TGA) paying a 6.5 cent fully franked dividend
Commodities
After gaining about $US16 over last week gold has firmed $0.10 to $US1,274.10 an ounce for the August contract on Comex.
Silver has added $0.17 to $19.66 for July.
Copper has lifted $0.004 to $3.03 a pound.
Oil has risen $0.38 to $US106.91 a barrel for July light crude in New York.
(20min delay)