RTTNews - The stock market in Australia ended in negative territory on Friday, mirroring the losses on Wall Street on fresh concerns about the pace of economic recovery in the world's largest economy.
Weekly jobs report released by the U.S. Labor Department for the week ended May 16th showed that first time jobless claims showed a smaller-than-expected decline and continuing claims rose further to a new historic high. The Philadelphia Federal Reserve's business activity index for the first half of May showed improvement but rose by less than expected, further mitigating risk appetite. However, the forward-looking indicators for April from the Conference Board came in slightly better than expected, raising some economic prospects for the near future.
The Dow closed lower by 129.91 points or 1.54% at 8292, the Nasdaq finished down by 32.59 points or 1.89% at 1695, and the S&P 500 slipped by 15.14 points to 888.
After opening unchanged at 3,805, the All Ordinaries Index drifted down to 3,744 in early trading following weak cues from Wall Street. Energy and mining stocks slipped, forcing the index to trade in negative territory despite recovery attempts during the mid-day. The index ended firmly in negative territory and closed slightly above the day's low at 3,755, down 1.30% or 49.40 points. The benchmark S&P/ASX 200 Index followed a similar trend and ended lower by 52.30 points, or 1.40%, at 3,762.
No major economic reports were released during the day. In a statement, the Australian Government defended its stance on climate change legislation and hinted that the new scheme would result in mining industry losing as much as 24,000 jobs over the next decade.
Mining stocks declined, led by Rio Tinto following reports that Chinalco might not agree to the proposals made by Rio Tinto to restructure the US$19.5 billion deal. Sharp drop in metal prices also weighed on the mining stocks. Copper prices slipped 2.6% on the London Metals Exchange. Rio Tinto lost 3.30%, while BHP Billiton declined 2.73%.
Energy stocks also declined on lower crude oil prices in the international market. Crude oil prices for July delivery slipped 1.6% in New York and ended at $61.05. In Asian Trading, oil prices edged up and ended at $61.36, up 35 cents, or 0.2%. Woodside Petroleum slumped 4.43%, Santos shed 3.73% and Oil Search edged down 0.19%.
Citing global downturn as the primary reason, Wesfarmers, owner of Coles super-market chain, decided to impose a freeze on salary payments and reduce bonuses to the senior management. The stock slipped 2.62% following the news. Among other retailers, David Jones lost 3.76%, Harvey Norman slipped 1.33% and Woolworths declined 1.15%.
Gold stocks bucked the weak sentiment and moved to the upside, tracking higher bullion prices. Lihir Gold advanced 1.59%, New crest Mining added 0.41% and Sino Gold surged 8.26%.
Mixed trend was witnessed among banking stocks, Commonwealth Bank of Australia slipped 0.28%, Australia and New Zealand Bank lost 1.41% and Westpac Banking declined 0.31%. However, National Australia Bank edged up by 0.51%.
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