Local shares set to fall after Wall St shudders
AUSTRALIA'S sharemarket is tipped to drop nearly 1 per cent this morning when it opens after US and European markets suffered big falls on Friday.
AUSTRALIA'S sharemarket is tipped to drop nearly 1 per cent this morning when it opens after US and European markets suffered big falls on Friday.The S&P 500 fell 1.7 per cent and the Dow Jones Industrial Average fell 1.5 per cent after disappointing profit results and trimmed forecasts spooked US investors.The Nasdaq lost more than 2 per cent after the world's biggest company, Apple (down 3.6 per cent), and rival Microsoft (down 2.9 per cent) were caught up in a tech stock rout.European stocks shed 1.2 per cent in value after the region's leaders appeared to make little progress at a summit of leaders in Brussels."In a celebrated instance of kicking the can down the road, the EU summit appears to have delayed any difficult decisions on the euro banking union until next year," a UBS economist, Paul Donovan, said."President Hollande of France suggested that a troika deal on Greece was within reach. This is a supreme statement of the obvious. Greece cannot leave the euro without threatening euro break-up, so Greece is in a strong position. Troika negotiations are all spin, not substance."The Australian futures market was yesterday pointing to a 0.99 per cent fall on the local bourse today.The Reserve Bank assistant governor, Guy Debelle, will deliver a speech to the Australian Securitisation Forum this afternoon.Market watchers are also awaiting the release on Wednesday of inflation figures for the September quarter.The figures are expected to show an increase in the annual inflation rate, adding impetus to the case for another interest rate cut in November.The federal government is expected to release today its mid-year economic and forecasting outlook, which will contain an update on the budget for this year."There's a risk that could entail further tightening measures because the budget is running well behind the surplus," said Shane Oliver, the chief economist of AMP Capital.Last week, the S&P/ASX 200 Index closed nearly 1.9 per cent higher for the week, after closing above the 4500 points level for the last three days.with AAP