News: Outlook: Aus shares set to sink on open

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Following deeply negative leads from US markets reacting strongly to US jobs figures, the Australian share market looks set to open sharply lower this morning. 

 

US Economic news

The US Labor department says that the US economy added 295,000 jobs in February sending the unemployment rate to 5.5 per cent, a level not seen since May 2008. It’s also the 12th consecutive month the US economy has added over 200,000 jobs, a strong signal that it may be time for the US Federal Reserve to start raising interest rates. 

 

Markets

Wall Street closed sharply lower on Friday: The Dow Jones Industrial Average lost 1.5 per cent to close at 17,857, the S&P 500 lost 1.4 per cent to close at 2,071 and the NASDAQ lost 1.1 per cent to close at 4,927.

 

European markets closed mixed: London’s FTSE lost 0.7 per cent, Paris added 0.02 per cent and Frankfurt lifted 0.4 per cent.

 

Asian markets closed were also mixed: Tokyo’s Nikkei added 1.2 per cent, Hong Kong’s Hang Seng shed 0.1 per cent, and China’s Shanghai Composite lost 0.2 per cent.

 

The Australian share market closed slightly lower on Friday: The S&P/ASX 200 Index dipped 5 points to finish at 5,899, down 30 points on the week. On the futures market the SPI is 64 points down. 

 

Currencies

The Australian Dollar at 7:30AM was buying 77.06 US cents, 51.25 Pence Sterling, 93.12 Yen and 71.17 Euro cents.

 

Economic news

Due out today are ANZ job ads for February, an indicator of the employment situation at home. The NAB Business survey is due on Tuesday and the official unemployment rate is due on Thursday ahead of PMI figures Friday. 

Company news
 

Electro Optic Systems Holdings Limited (ASX:EOS) has snagged a deal to revamp and upgrade remote weapons systems for the Australian Defence Force. The ADF contract, worth $6.5 million will see EOS upgrade 45 of the weapons systems by April 2016 giving the army greater capabilities in long range technology. Shares in Electric Optic Systems closed jumped 11.19 per cent to $0.745 on Friday at the news.

 

Rio Tinto Limited (ASX:RIO) informed the market after close on Friday that it was upgrading resources estimates at three of its operations. The miner said coal reserves at its Hail Creek mine in Queensland have increased by 25 million tonnes and estimations ore reserves from parts of its Pilbara iron deposits have nearly tripled in value. Meanwhile ore reserves estimates have also increased at its Diavik diamond mine in Canada. The upgrades come after the completion of operations planning and resource evaluations.  Shares in Rio Tinto last traded 1.24 per cent lower at $60.39 ahead of the weekend. 

 

Commodities

Gold has lost $31.90 to $US1,164 an ounce for the April contract on Comex. Silver has dropped 35 cents to $15.81 for May. Copper has shed 5 cents to $2.61 a pound. Oil has slid $1.15 to $US49.61 a barrel for April light crude in New York.