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ASX reverses gains to close in red
The West Australian

The Australian sharemarket reversed an opening rally to a fresh 22-month high as investors booked profits ahead of the earnings season starting tomorrow.

Following the firm lead from Wall Street on Friday the S&P/ASX 200 index opened 0.7 per cent higher but sold off on rising volume to close 13.6 points, or 0.28 per cent, down at 4907.5 points.

Pointing to a slowdown in the domestic economy, the ANZ jobs ads index slipped another 0.9 per cent in January and dwelling approvals tumbled 4.4 per cent, while short of the one per cent increase forecast.

Miners outperformed after spot iron ore climbed US70� to $US153.20 a tonne and copper bounced per cent on Friday. US stocks hit the highest levels since 2007 after the non-farm payrolls report narrowly missed forecasts and the unemployment rate ticked up to 7.9 per cent, reinforcing the view that the US Federal Reserve would continue with its program of buying Us bonds to pump liquidity into the economy.

In Tokyo the Nikkei index climbed 0.5 per cent and the Shanghai composite index was up 0.6 per cent at the close of the ASX

The Chinese services PMI edged up 0.1 points to 56.2 points, with the leading new orders component sliding 0.6 points and expectations falling 3.2 points.

The Australian dollar was steady at $US1.0425 having hit a low of $US1.0365 on Friday, with few market participants expecting a rate cut by the Reserve Bank tomorrow.

Eurozone jitters were fanned by the nationalisation of Dutch bank and financial group SNS Reaal after depostors took flight and private sectors investors baulked at investing in the ailing group.

France's PMI index rang alarms bells as it remained deep in contraction, while accusation of corruption in Spain threaten to unsettle markets.

More to come…