Local stocks are giving back yesterday's gains in the early session, with investors choosing to stay out of the market ahead of several key international events this week. Profit takers moved in on US and European markets overnight, as uncertainty surrounds the outcome of the Dutch election being held tomorrow and the German constitutional ruling on the Eurozone bailout plan. At lunchtime in the East, the All Ordinaries Index (XAO) is down 11.5pts or 0.3pct to 4346.5.
The stock markets are having a monster rally. But next earnings season might challenge that.
The iron ore price rallied overnight, up more than 6pct to US$95 a tonne, however the rise is failing to have an impact on iron ore players Fortescue Metals Group (FMG) and Rio Tinto (RIO). After rising by more than 7pct yesterday, FMG shares are today down 2.5pct to $3.46 while RIO is off 0.6pct to $54.40.
Index leader BHP Billiton (BHP) is slightly firmer, up 0.2pct to $32.52.
Financial stocks are trading flat, with defensive players doing most of the work. Shares in Telstra (TLS) are steady at $3.51, CSL Limited (CSL) and Cochlear (COH) in the healthcare space are both firmer by around 2pct.
In economic data released today, personal finance loans rose by 0.1pct in July, from June. The Australian Bureau of Statistics (ABS) has reported that personal finance commitments, seasonally-adjusted, increased to $7.522 billion in July, from $7.513 billion in June. Total commercial loans in June fell 5pct to $29.819 billion, seasonally-adjusted, from $31.395 billion in June. Lease finance was up 3.4pct to $569 million, compared with $550 million the previous month. Housing finance for owner occupation dropped 1.4pct to $13.386 billion, from $13.573 billion the month before.
Meanwhile, the NAB Business survey showed business conditions rose 4pts in August to a reading of plus 1. Confidence amongst Australian businesses dropped 5pts to a reading of negative 2.
The Australian dollar is buying US103.44c, £0.6463 and €80.98c.
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