The Australian share market opened weaker this morning even with the strong run on off shore market and commodities on Friday night. The US markets closed higher on Friday after Federal Reserve, Chairman Ben Bernanke, said that he hasn't ruled out further action to boost the US economy. This announcement also helped the European markets push to one side the fact that Eurozone unemployment hit a new record high in July. 18 million people were unemployed in the, 17 nation, Eurozone at the end of July with the unemployment level holding at 11.3%.
Daniel Munoz / Reuters
Office workers are reflected on a screen display as they walk past the Australian Securities Exchange in this file photo
Over the weekend we had the official Chinese Purchasing Managers Index (PMI) released to the public. The PMI showed that manufacturing eased from 50.1 to 49.2 in August. This result was worse than expected and has taken some of the joy out of markets this morning. The All Ordinaries Index (XAO) opened down 15pts and by lunchtime the index had lost over 12points to $4,326 points
Most sectors were hit by lacklustre trading ahead of the US market closure tonight for the September Labour day holiday. Also a large number of key companies have gone ex-dividend today, this has taken money out of the markets and reduced the value (and point status) of the market.
Today the S&P/ASX 200 Materials sector has lost ground off 0.61%, even with the US dollar iron ore price rising for the first time in 2 weeks on Friday night in the US, with gold, metals and oil prices all higher. BHP Billiton Limited's (BHP) share price has fallen so far today off 2% or $0.65 to $31.14 after going ex-dividend for $0.54.61cents a share today.
BHP's rival Rio Tinto Limited (RIO) lifted by 0.47% to $49.47, while our 3rd largest listed iron ore miner Fortescue Metals Group Limited (FMG) gave back 0.4% to $3.52.
Our largest listed gold producer, Newcrest Mining Limited (NCM) added 2.5%, by lunchtime, to $25.27 helped by another strong lift in the US dollar gold price on Friday night. The December COMEX gold futures price rose by US$30.50 an ounce to a 5month high of US$1,687.60 an ounce. Gold is now holding at US US$1,693 an ounce in early Asian trade. St Barbara Limited (SBM) also higher up 2.5% to $1.51 and OceanaGold Corporation (OGC) up 7.2%.
The energy sector has also been hit this morning, even with the lift in the US dollar oil price on Friday night. The S&P/ASX 200 Energy Sector off 0.87%, and the US oil price in early Asian trade holding at US$96.23 a barrel. Santos Limited (STO) off 1% to $11.11 and Woodside Petroleum Limited (WPL) off 0.29% to $34.20.
The four major banks were all a little weaker and large insurer also down pushing the S&P/ASX 200 Financials sector into the red, off 0.38%. Commonwealth Bank (CBA) down 0.5%, while National Australia Bank (NAB) off 0.2% to $25.15. Both Westpac (WBC) and ANZ Banking Group (ANZ) were just a few cents weaker. Queensland based financial services company, Suncorp (SUN), lost 1.95% while QBE Insurance Group Limited (QBE) lost 1.5% and AMP Limited (AMP) off over 2.9% or $0.13 to $ after going ex-dividend today for $0.12.5 cents a share.
The medical sector hit by some of its larger firms going ex-dividend today, Sonic Healthcare Limited (SHL) off $0.41 a share after paying out $0.35 cents to shareholders and Ramsay Health Care Limited (RHC) off $0.23 after paying out $0.34.5 cents. CSL limited (CSL) and Cochlear Limited (COH) also lower, both off around 0.5%in early trade.
In economic news, the Australian Industry Group's monthly manufacturing index showed the sector increased by 5points in August, to 45.3points, but still overall was below the 50 point level needed to show growth. The index has now contracted for the sixth straight months.
The Australian dollar (AUD) continues to lose ground at the start of trade today after the weak Chinese manufacturing data from Saturday. Now, 1 Australian dollar will buy you US$102.68 cents, €81.72 cents and £64.76 pence.
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