* US stock markets ended in the red on Friday on the back of disappointing jobs data.
* European stock markets fell, recording their biggest weekly decline since last November.
* Asian stock markets ended lower for the week, except for Japan.
* Commodities prices were mixed, Gold prices are trading around $US1,575, while crude-oil closed around $US92.
The Aussie market has held below the 4930 prior short-term pivot level and is looking to open lower today, as stock prices were lower in Europe and in the US markets after jobs data disappointed.
SPI Futures is trading below the key level of 4900 again, ended down -0.1% (down -5 points) at 4,890. The key levels for the ASX200 index today are 4850 to 4900.
See below for ASX listed companies in the news today.
US stock markets ended in the red on Friday on the back of disappointing jobs data.
The three benchmark indexes were all down around -0.4% for the session, but the Dow Jones and the S&P500 indexes are still near all-time highs and for the month the Dow Jones and the S&P500 are still in the green. Seven of the ten S&P500 sectors were lower with falls led by the Technology and Consumer Staples sectors down over -0.7%, while the energy sector bucked the trend up 0.2% for the session.
Traders reacted to the news on jobs, which followed the disappointing data from the Institute for Supply Management’s index (ISM) of US non- manufacturing businesses, which covers almost 90 percent of the economy covering industries ranging from utilities and retailing to housing, health care and finance, showing a fall to 54.4 in March (down from 56 previously – readings above 50 signal expansion).
US companies begin releasing their first-quarter earnings this week. Analyst estimates compiled by Bloomberg, indicate the expectation that earnings at S&P500 companies decreased 1.8 percent on average in the first three months of the year, however the energy sector corporate earnings have fallen up -6.3 percent as the average oil price fell to $US94 (down from an average of $US103 in 1Q12) and profits at technology companies are forecast to have declined -4 percent the second worst performing sector.
The monthly Non-Farm Payrolls employment report out on Friday, disappointed as payrolls only grew by 88,000 workers last month (half of the net 195,000 workers forecast), as the the effects of the US sequestration start to bite.
The Dow Jones closed down -0.3% at 14,565, the S&P 500 index down -0.4% at 1,553, the Nasdaq ended down -0.7% at 3,204 and the smaller cap Russell 2000 was down -0.3%.
European stock markets fell again Friday night, recording their biggest weekly decline since last November, as the European Central Bank (ECB) reminded investors that risks remain to the eurozone’s recovery.
The Europe Stoxx 600 ended down another -2.3% for the week. ECB officials kept the benchmark interest rate at a record low of 0.75 percent, while the BoE left their benchmark interest rate at a record low of 0.5 percent. National benchmark indexes fell in all 18 western European markets last week.
Sentiment was dampened by comments from the ECB President Draghi who sees risks to the eurozone economic recovery and warned that monetary policy cannot compensate for lack of government action. Traders are trying to come to terms with the new paradigm where the conditions of the Cyprus bailout which is setting a precedent for other eurozone lenders in future.
The losses were again led by the commodity related sectors, as metal prices continued their decline, and further selling came in after the US employment data disappointed.
In Germany, the market retreated for a third session, on the back of the ECB comments. In the UK the FTSE gave back the more of its recent gains, as copper for three-month delivery in London dropped for a sixth day, sliding to an eight-month low, which again weighed on the miners with BHP and Rio Tinto down another -1.4%.
In London the FTSE 100 was down -1.5% at 6,249, in Germany the DAX closed down -2.0% at 7,658, while in France the CAC closed down -1.7% at 3,663, while Spain closed down -0.6%.
Asian stock markets ended lower for the week, except for Japan, as investors digest the aggressive BoJ stimulus measures.
The MSCI Asia Pacific Index ended down -1.5% for the week, the index is up 3.6% for the year. Markets in China, Hong Kong were weaker on news of a new strain of bird flu and concern that China will move to cool its property market. The South Korean Kospi index fell again and had its biggest fall in four months, as the risk of conflict with North Korea escalated.
In Japan the Nikkei 225 Stock Average closed higher for the session, after the BOJ said it will double the monetary base by the end of 2014 in a bid to reach 2 percent inflation in two years, in its biggest round of quantitative easing. The BoJ has streamlined its asset purchase programs, temporarily suspended a cap on some bond holdings and dropped a limit on debt maturities and said it will buy 7 trillion yen ($US74 billion) of bonds a month. The Japanese market has led Asia on the back of speculation the nation will deploy more stimulus and amid signs the improving US economic data, and is up 48% from its November lows. Japanese exporters and real-estate developers led the advance.
In China the SSE Composite closed was down -0.1% at 2,225, while in Hong Kong the Hang Seng Index down -2.7% at 21,726 and in Japan the Nikkei 225 Index was up 1.8% at 12,833.
The Dollar Index was lower at 82.64 on a higher Euro, while the Australian Dollar last traded lower at 1.036. Commodities prices traded mixed.
For the session the Benchmark crude NYMEX for March delivery was down -0.6% settled at $US92.70. Copper prices are looking for key support level as Copper for March delivery was down -0.2% at $US3.344, while March Gold was up 1.5% (or $US23.50) at $US1,575.
ASX News Today
BANKs – The Labor government has announced its superannuation changes, including a tax exemption on superannuation earnings supporting pensions and annuities will be capped at $100,000, and anything above that level taxed at a rate of 15 percent and people with over $2 million in superannuation will be forced to pay tax during the pension phase.
DJS – Australian shoppers are expected to buy fewer clothes from local retailers in 2013 before starting to spend up next year.
DTE – Dart Energy shares have tumbled to record lows as the company cuts costs and slashes jobs in response to government crackdowns on coal seam gas projects.
FXJ – Fairfax Media has won support from key stakeholders with its latest restructure but the market is still waiting for details of how the struggling media group will deliver further cost cuts.
TOL – Toll roads operator Macquarie Atlas Roads does not anticipate making any acquisitions while it considers the future of most of its assets.
Cic Australia Ltd
Fonterra Share Fund
Gowing Bros Limited
Ilh Group Ltd
ASX – to open lower
US & UK/Europe – lower again
US ADRs – Broadly lower!!…
ANZ -1.6%, NAB -1.9%
BHP +0.3%, NEM +0.6%, RIO -0.3%
By Michael Hevern
D2MX Investment Advisor
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