The Australian sharemarket is set for a flat start as world markets took a breather overnight following strong gains in the first few trading days of 2013.
The SPI futures index was up four points at 4,696.
The benchmark S&P/ASX200 index on Monday lost 6.5 points to 4,717.3 and the broader All Ordinaries index fell 4.8 points to 4,738.1.
What you need to know
- SPI futures up 4 points at 4696
- AUD pushing $US1.05, currently $US1.0494
- In the US, S&P500 is down 0.4 per cent at 1460.04
- In Europe, London's FTSE dropped 0.4 per cent to 6064.58
- Germany's DAX lost 0.6 per cent to 7732.66
- Gold down half a per cent at $US1647.15
- NY Oil futures up 0.1 per cent to $US93.19 per barrel
- Iron ore fetching $US153.90
In economic news today, the Australian Bureau of Statistics releases international trade in goods and services data for November.
Commonwealth Bank economist Gareth Aird said that he expected to see trade deficits continue, with higher volumes in iron ore exports not enough to offset the impact of lower prices.
"A slowing global economy more generally has deflated resource commodity prices in 2012 to the detriment of Australia’s trade performance. With merchandise imports higher in November and export prices weaker, we expect to see a widening of the trade deficit to around $2.9 billion in November," Mr Aird said.
The Australian Industry Group and the Housing Industry Association will also release their performance of construction index for December.
Stocks to watch
Lynas Corporation
Yesterday - up nine cents, or 14.4 per cent, at 71.5 cents.
Rare earths miner Lynas expects to be producing finished products from its controversial plant in Malaysia within weeks.
PrimeAg Australia
Yesterday - up one cent to $1.15 - Rural investor PrimeAg Australia has reached a $2.2 million insurance settlement relating to losses it incurred during the 2011 Queensland floods.
Rio Tinto
Yesterday - down $1.15, or 1.7 per cent, at $67.40 - Mining giant Rio Tinto is considering halting operations at its alumina refinery in Arnhem Land.
Whitehaven Coal
Yesterday - down two cents, or 0.57 per cent, at $3.55
Whitehaven Coal shares fell heavily on Monday following a hoax announcement on funding for its Maules Creek project.
The shares have since gained back most of the lost ground after Whitehaven said the release was a hoax and the corporate watchdog will investigate the incident.
World markets
Overnight there were broad losses across the globe, as investors erred on the side of caution and began to lock in New Year gains. As the optimism from the 'fiscal cliff' deal begins to wear off, markets are know turning their eyes to US fourth-quarter earnings.
"There is little doubt that concerns about the fiscal cliff created spending hesitancy in both consumers and businesses in the fourth quarter, and it is likely that will adversely impact earnings season," said Randy Frederick, managing director of active trading and derivatives at Charles Schwab in Austin, Texas.
US stocks fell on Monday as banks agreed to pay billions in a settlement with US regulators and investors speculated that US earnings for the end of 2012 would be only modestly better than in the previous quarter.
The Dow Jones industrial average was down 77.33 points, or 0.58 per cent, at 13,357.88. The Standard & Poor's 500 Index was down 8.69 points, or 0.59 per cent, at 1,457.78. The Nasdaq Composite Index was down 12.39 points, or 0.40 per cent, at 3,089.26.
Britain's blue chip index fell on Monday for the first time this year, baulking at technical resistance levels having reached its highest close for nearly two years in the previous session. The FTSE 100 shed 0.4 per cent in broad-based losses, with every sector falling apart from financials, which received a regulatory boost over the weekend.
Commodities
Gold prices slipped on Monday as stock markets retreated before this week's start of earnings season, with uncertainty over the Federal Reserve's quantitative easing programme keeping up pressure on the precious metal.
Spot gold was down 0.6 per cent at $US1,647.36 an ounce, while US gold was down 0.1 per cent at $US1,647.60.
Brent crude oil prices slipped toward $US111 a barrel on Monday while the US futures contract held firm, narrowing the spread between the two benchmarks to the lowest level since September as traders eyed the anticipated start-up of a Midwest pipeline.
In London, the Brent crude oil contract slipped 33 cents to $US110.98 a barrel by, and traded between a high of $US111.54 a barrel and a low of $US110.54 a barrel on the day.
The US crude oil future contract for February delivery, which is delivered into storage tanks at Cushing, slipped just 5 cents to $US93.04 a barrel.
BusinessDay with wires
