Australian Stock Market Report – Morning September 23, 2014

Housing — Buildings at a government housing development in Caracas Venezuela Reuters/Stringer

* In US economic data, existing home sales fell by 1.8% to a 5.05 million annualised rate in August, short of forecasts tipping sales near 5.20 million. And the national activity index fell from 0.39 to minus 0.21 in August.

* The Group of 20 finance ministers say that they are close to the goal of introducing measures designed to boost global economic growth by 2 percentage points by 2018.

* European shares fell on Monday on fears of slower global economic growth. Shares in UK retailer Tesco slumped 11.6% after slashing its earnings forecasts. The FTSEurofirst 300 index fell by 0.6%, further retreating from the highest levels in more than six years. The German Dax rose fell by 0.5% while the UK FTSE lost 0.9%. And Australia's major miners were sharply lower in London trade with shares in BHP Billiton down by 3.5% while Rio Tinto lost 3.8%.

* US sharemarkets weakened in line with other global sharemarkets on Monday. Investors fretted about the health of the Chinese economy and how aggressive the US Federal Reserve will be in lifting interest rates in 2015. And a fall in existing home sales weighed on housing stocks. The Dow Jones index fell by 107 points or 0.6%. The broader S&P 500 index fell by 0.8% while the Nasdaq lost 52 points or 1.1%.

* US long-term treasury prices rose again on Monday (yields lower) after the Chinese finance minister indicated that the country wouldn't rush to stimulate growth. US 2 year yields were down 1 point to 0.549% while US 10 year yields were down by 1 point to 2.564%.

* Major currencies were weaker against the greenback over the European and US sessions on Monday but finished off the lows. The Euro fell from highs near US$1.2865 to around US$1.2815, ending US trade near the US$1.2845. The Aussie dollar fell from highs near

US89.15c to lows around US88.55c before ending the US session near US88.75c. But the Japanese yen weakened from 108.78 yen per US dollar to JPY109.15, before reversing course and ending US trade near JPY108.78.

* World oil prices were lower on Monday in response to ample world oil supplies, concerns about a prolonged slowdown of the Chinese economy and a stronger greenback. Brent crude fell by US$1.42 or 1.4% to US$96.97 a barrel with the US Nymex price down by US89c a barrel or 1.0% to US$91.52 a barrel.

* Base metal prices were lower on Monday, falling up to 4.2%, led by nickel. But aluminium prices were unchanged. Gold prices edged above 9-month lows on Monday with the Comex gold futures quote higher by US$1.30 an ounce or 0.6% to US$1,217.90 per ounce. Iron ore fell by US$1.90 or 2.4% on Friday to US$79.80 a tonne.

Ahead: In Australia, weekly consumer confidence data is released. In the US, Europe and China, "flash" manufacturing gauges are released. In the US, the Richmond Fed index is released with the monthly home price index and weekly chain store sales.

[Kick off your trading day with our newsletter]