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Australian shares are set to gain after world stocks were mixwed on China's plans for tighter controls on its property sector added to concerns about global growth.
On the ASX24 at 6.20am, the SPI futures contract was 25 points higher to 5046. The Aussie dollar was off yesterday's lows. After hitting a seven month low of $US1.0117, the dollar has climbed back to $US1.0175. It was also buying 94.96 yen, 78.24 euro cents and 67.43 pence.
The board of the Reserve Bank meets today to decides on official interest rates. A Bloomberg survey of economists expects the cash rate to remain at 3 per cent, with only of the 29 surveyed economists predicting a 25 basis point cut to 2.75 per cent.
What you need to know
- SPI futures are 25 points higher at 5046
- The $A is higher at $US1.0175
- In recent trade in New York, the S&P500 was 0.07% higher to 1519.23
- In Europe, the FTSE100 lost 0.52% to 6345.63
- China iron ore lost $US1.80 to $US148.40 a metric tonne
- Gold rose 10 cents to $1,572.40 an ounce
- WTI crude oil slid $US1.03 to $US89.65 a barrel
- Reuters/Jefferies CRB index was flat at 294.70
Making news today
In economics news:
- Reserve Bank of Australia monthly board meeting and interest rate decision - 2.30pm
- ABS retail trade data for January - 11.30am
- ABS balance of payments position for December 2012 - 11.30am
- ABS government finance statistics for December quarter - 11.30am
- AiGroup/CommBank Performance of Services Index (PSI) for February - 9.30am
There is no major companies news scheduled for today.
Analyst rating changes:
- Sandfire Resources raised to neutral at JPMorgan
- Amcom rated new buy at Nomura
The dollar
The Australian dollar is more than half a US cent higher ahead of the Reserve Bank of Australia’s (RBA) March interest rate decision.
At 6.30am AEDT the currency was trading at $US1.0181, up from $US1.0117. The Australian dollar dropped to an eight-month low of $US1.0117 following sharp falls on local sharemarkets, led by concerns about a possible slowdown in Chinese economic growth. But it drifted higher overnight, ahead of the RBA’s March board meeting.
Offshore overnight
United States
US stocks rose, sending the Dow Jones Industrial Average toward the highest close since 2007, as speculation the Federal Reserve will continue stimulus measures overshadowed concern over spending cuts and China’s economy.
Key numbers:
- S&P 500 added 0.3% to 1523.23
- Dow Jones Indus Avg lost 0.2% to 14,120.14
- Nasdaq composite was flat at 3168.94
Europe
European stock markets closed mixed after US lawmakers failed to prevent $US85 billion ($A83 billion) in spending cuts set to take effect in the world’s biggest economy and concern grew about prospects for China, the second biggest.
Key numbers:
- London’s FTSE 100 lost 0.52% to 6345.63
- Frankfurt’s DAX lost 0.21% to 7691.68
- Paris’s CAC 40 added 0.275 to 3709.76
- Milan’s FTSE Mib lost 0.85% to 15,542.17
Asia
Asian markets have mostly tumbled with US lawmakers failing to prevent the imposition of $US85 billion ($A83.74 billion) in spending cuts that kicked in at the end of last week. Chinese shares suffered the biggest sell-off with property developers hit by measures to cool the housing market, but Tokyo enjoyed modest gains as the man tapped to become Japan’s top central banker vowed to tackle deflation.
Key numbers:
- Japan's Nikkei 225 added 0.40% to 11,652.29
- China's Shanghai composite lost 3.65% to 2,273.40
- Hong Kong's Hang Seng lost 1.50% to 22,537.81
How we fared yesterday
The sharemarket finished sharply lower today, following big losses on Chinese share markets and as a raft of stocks traded ex-dividend.
The benchmark S&P/ASX200 lost 75.6 points, or 1.5 per cent, to 5010.5, while the broader All Ordinaries fell 72.4 points, or 1.4 per cent, to 5028.5. In cash terms, about $21 billion was wiped off the sharemarket.
BusinessDay with agencies