MARKET CLOSE (4.30pm AEDT)
It was yet another tough day for the Australian sharemarket
with the All Ordinaries index (XAO) down 1.7 pct or 74.8 pts to
4264.1. There was weakness across the board today with the miners
the biggest losers, down by more than 2 pct. Thanks to a positive
start to trade on Monday, shares pulled back by only 1.87 pct
The S&P/ASX 200 Financials index lost 1.9 pct or 77.8 pts
to 4012.8. The four big banks all lost ground despite passing on
the Reserve Bank's (
) rate cut in full. National Australia Bank (NAB) dropped 2.4 pct
or 59 cents to $24.02, Westpac (
) fell 2.14 pct or 46 cents to $21.07, Commonwealth Bank of
) weakened by 1.69 pct or 84 cents to $48.84 and ANZ Banking
Group (ANZ) lost 1.33 pct or 28 cents to $20.85.
The S&P/ASX 200 Materials index (a measure of stock
performance in the mining sector) slumped by 2.44 pct or 279.3
pts to 11153 today with the two biggest stocks in the index, BHP
) and RIO Tinto (
) the most significant contributors to the weakness. BHP lost
3.05 pct or $1.13 to $35.86 while the smaller RIO dropped 3.56
pct or $2.35 to $63.74.
Investment manager AMP Limited (AMP) could not hold on to its
gains for the whole session and ended the day down 0.46 pct or 2
cents to $4.30 despite a Japanese financial institution
announcing that it aims at taking a 15 pct stake in the
Next week in Australia a number of economic reports will be
released. On Monday, the latest housing finance report is issued
for October. This shows us how many new loans were created by the
banks during the month. In the middle of the week, the latest
report on consumer sentiment will be released. This will show us
how Australians are feeling about their finances and the state of
the broader economy.
In the region China had one of its biggest days of the month
in terms of economic data. The much anticipated Consumer Price
Index (CPI) was released today and came in lower than expected.
This opens the door for further stimulus potentially.
Japan also released a number of economic readings throughout
the day including the latest growth report which showed that the
Japanese economy expanded by 1.4 pct.
In Europe tonight, the Economic Summit continues for its
second day. This is the 15th meeting held by the European leaders
in less than two years. Some of the commentary from the two day
meeting has been less than promising so far. French President,
Nicolas Sarkozy said that there is no 'second chance' if a deal
to reduce European debt is not reached this weekend.
The French Minister for European Affairs, Jean Leonetti warned
that the Euro could 'explode' and that there still remains every
possibility that Europe could 'unravel'. As you might expect, the
market tends to not react well to this sort of
Herman Van Rompuy, the European Council's President said today
that the continent's leaders will commit to strong fiscal rules
and 23 of the 27 Euro states will agree to a treaty. A deal
including all 27 member nations is not looking likely at the
moment however another day of meetings is still expected. The
first day of meetings continued until around 3am (European
Germany tonight will release its trade balance (difference
between exported and imported goods) in addition to its latest
inflation (change in prices) reading.
In the U.S tonight, the latest report on the state of consumer
confidence will be out in addition to the world's largest
economy's trade balance.
The volume of shares traded came in at 1.96 billion today,
worth $4.3 billion. 295 shares were up, 656 finished weaker and
361 ended unchanged.
At 4.30pm AEDT on the Sydney Futures Exchange, the ASX24
futures contract is down 2.19 pct or 94 pts to 4189.
Due to daylight savings, most major European markets are now
trading between 7pm (AEDT) and 3.30am (AEDT). Futures in Europe
are pointing to a stronger start to trade tonight.
Dow Jones futures are currently lower, indicating that U.S
stocks could start in the red tonight when American markets open
at 1.30am (AEDT). Due to the Americans going back an hour on
November 5, U.S markets will be trading between 1.30am (AEDT) and
Turning to currencies, the Australian dollar (AUD) has pulled
back with the uncertainty in Europe impacting confidence in
riskier assets. The AUD buys US101.1 cents.
Steven Daghlian, CommSec Market Analyst
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