RTTNews - After a weak start and a subsequent fall, the Australian stock market is seen recovering some lost ground in early trading on Monday with participants picking up stocks at lower levels. The mood is quite cautious following a negative close on Wall Street where stock prices fell on Friday due to economic concerns.
The Australian benchmark index S&P/ASX 200, which drifted down to 3,776 in early trades, recovered to 3,792 subsequently and is currently trading at 3,789.2, down 4.9 points from its previous close. The broader All Ordinaries index is down by 3 points at 3,787.6.
On Friday, the S&P/ASX 200 had ended at 3,794 with a loss of 30.8 points or 0.82%, while the All Ordinaries settled lower by 29.20 points or 0.78% at 3,791.
Energy stocks are off their early lows now. Materials and financials are trading mixed. Healthcare and industrial stocks are exhibiting weakness while utilities and consumer staples are attracting buyers.
Among materials stocks, BHP Billiton, which slipped sharply in early trade, is recovering and is up in positive territory with a modest gain. Rio Tinto is down by over 2%. Onesteel, Orica, Newcrest Mining and Bluescope Metal are trading lower, while Fortescue Metals is up sharply by 5.3%.
In the energy space, Woodside Petroleum and Santos are trading modestly higher, while Origin Energy is down by 1.6%.
Among bank stocks, Commonwealth Bank of Australia and National Australia Bank are down by 0.6% and 0.5% respectively while Westpac Banking Corporation is trading up 0.4%.
Among other markets in the Asia-Pacific region, Japan has rebounded into positive territory after a weak start. New Zealand is also trading in positive territory, while Korea and Singapore markets are exhibiting weakness. Stock markets across the Asia-Pacific region had ended Friday's session mostly lower.
In company news, CSR Limited is reportedly considering a range of options regarding the demerger of its sugar and renewable energy business. The group said in a statement that it would take a final decision on the structure of the two businesses on demerger and would inform investors of new developments. The stock is currently trading flat.
Mirrabooka Investments Ltd has reported a marginal rise in annual net operating profit, after the value of its portfolio fell and dividend earnings declined. Tough market conditions due to the global economic downturn saw the value of the company's portfolio fall by 19.4% in 2008/09. The company's net operating profit before gains on investments was A$8.38 million for the year ended June 30, up slightly from A$8.28 million in the previous year. No trade has taken place at the Mirrabooka Investments counter so far this morning.
On the economic front, according to the NSW Business Chamber Business Conditions Survey, confidence is increasing in New South Wales and business conditions appear to be improving. The survey has found 30% of businesses expect better conditions in the coming quarter and only 23% think that things will get worse.
In the currency market, the Australian dollar opened weak today as concerns over the U.S. economy hurt sentiment. The Aussie traded at US$0.7786/91 earlier this morning, down from Friday's close of US$0.7795/98. The Australian dollar is currently trading at 0.7808 to the U.S. dollar.
On Friday, Wall Street ended lower after a lackluster show. The major averages saw some upside in late session dealing, with only the Nasdaq being able to climb into positive territory. The tech-heavy Nasdaq was able to finish higher by 3.48 points or 0.2% at 1,756.03, while the Dow fell by 36.65 points or 0.5% to 8,146.52 and the S&P 500 dipped by 3.55 points or 0.4% to 879.13.
Major European markets also finished on the downside, with the German DAX Index and the French CAC 40 Index closing down by 1.2% and 1.4% respectively. The U.K.'s FTSE 100 Index also fell, posting a loss of 0.8% for the session.
Crude oil dropped below US$60 per barrel after the latest International Energy Agency report backed lingering demand concerns. Crude capped its worst week since early January, falling more than 10%. On Friday, light sweet crude for August delivery touched as low as US$58.72 in early trading before finishing at US$59.89 a barrel, down 52 cents from Thursday's close.
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