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The Australian share market was sold off for the second session in a row today, as a better than expected jobs report released in the US on Friday night caused investors to worry about an earlier than expected tightening in American interest rates. The All Ordinaries Index (XAO) fell by 26pts or 0.6pct to 4695.2 while the S&P/ASX 200 Index (XJO) dropped 25.7pts or 0.6pct to 4676.5.
The financial sector eased by 0.2pct despite a solid start. Shares in Westpac (WBC) fell 0.6pct to $23.89 while the Commonwealth Bank (CBA) eased by 0.3pct to $53.79 and the NAB (NAB) fell by 0.4pct to $28. Shares in the ANZ (ANZ) lost 0.1pct to $21.95. Macquarie Group (MQG) fell by 1pct to $48.
The materials sector fell by 1.8pct on weaker metals trade in London on Friday night. Index leader BHP Billiton (BHP) dropped by 1.9pct to $40.61 while Rio Tinto (RIO) was off 0.4pct to $71.59. Shares in Fortescue Metals Group (FMG) fell by 0.7pct to $4.26. Gold stocks suffered massive falls due to the price of the precious metal coming off record highs. At 4pm AEDT the Comex contract was down US$12 or 1pct to US$1157.50 an ounce. Shares in Newcrest Mining (NCM) fell 6pct to $36 while Lihir Gold (LGL) was off 4.8pct to $3.36.
The energy sector fell 1pct despite a higher oil price. At 4pm AEDT the Nymex contract was up US$0.16 or 0.2pct to US$75.63 a barrel. Woodside Petroleum (WPL) shares fell 1.6pct to $48.30 while Santos (STO) was off 1pct to $14.75 and Oilsearch (OSH) eased by 2pct to $5.90.
Elsewhere on the market, retail stocks were mixed. Shares in Woolworths (WOW) fell 0.5pct to $27.65 while Wesfarmers (WES) was off 0.03pct to $28.79. Harvey Norman (HVN) shares closed steady at $4.30 while JB Hi-FI (JBH) was up 0.8pct to $23.10. David Jones (DJS) eased by 1.6pct to $5.52.
Media stocks were also mixed. Newscorp (NWS) gained an impressive 3.8pct to $15.72 while West Australian News (WAN) rose 1pct to $7.89. The Seven Network (SEV) closed steady at $6.40 while the Ten Network (TEN) fell 1pct to $1.55. Fairfax (FXJ) eased by 1pct to $1.62.
In economic data today, petrol prices rose for the second straight week, up by 0.3 cents to a ten-week high of 121.8 cents per litre. A CommSec fuel study has found motorists are paying a higher price for fuel, with wholesale margins rising.
Meanwhile, the Olivier internet job index rose by 5.9pct in November, the third increase in the past four months. Demand for staff was greatest in ancillary services like Human Resources, Administration and Clerical. The ANZ index of newspaper and internet job ads rose by 5.2pct in November, the biggest lift in 30 months. Job ads had fallen by 1.7pct in September. Newspaper job ads rose by 8.3pct, with internet job ads up 5pct.
"The unemployment rate is close to peaking, and will give the Reserve Bank more confidence to raise interest rates gradually to a more neutral setting," said CommSec Economist Savanth Sebastian of the data. "CommSec expects the cash rate to rise to 5pct by the end of 2010."
The Australian dollar finished the day's trade at US91.58c, £0.5557 and €61.51.
On the market overall, a total of 2.65 billion shares were traded, worth $4.43 billion. 430 were up, 681 were down and 306 were unchanged.
At 4.15pm AEDT on the Sydney Futures Exchange, the Share Price Index (SPI) futures contract was at 4677, down 29 pts.
Ahead tonight, consumer credit numbers are released in the US. Federal Reserve Chairman Ben Bernanke delivers a speech on the economic outlook and Fed policy at the Economic Club of Washington.
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