\n\tBy Greg Peel<\/p>\n
\n\tThe Australian market opened yesterday the same way it had closed last week – weak. The foreign exit continued in the morning and provided for another 1% fall before the market finally rediscovered some buying interest, ensuring a less dramatic 0.5% fall by the close. The Aussie continued to fall in tandem, perpetuating the feedback loop, and is down another 1% from Friday night to US$0.9633.<\/p>\n
\n\tThe ASX<\/span> 200 has now fallen 5% from its peak in early May, which came around the time the likes of Woodside Petroleum ((WPL<\/span>)) and the banks were announcing their expanded capital return measures. Last Wednesday Westpac ((WBC)) was offering an FY13<\/span> forward yield of 5.9% before franking and that has risen to 6.4% on yesterday’s close. As to whether there is more foreign selling to come is unclear, but yields on stocks such as the banks should provide the dampener<\/span>.<\/p>\n \n\tBeijing yesterday announced a 9.3% year on year rise in Chinese corporate profits in April, up from 5.3% in March. While corporate profits are tracking in line with industrial production growth, April 2012 provided a rare 2.2% fall in profits which makes the one year gain less impressive than it otherwise looks. Chinese exporters are now becoming members of the Strong Currency Club, with Beijing allowing the renminbi<\/span> to hit a 19-year high against the US dollar yesterday. The strength of the renminbi<\/span> is yet to be felt in Chinese data, economists suggest.<\/p>\n \n\tThe strength of the renminbi<\/span> is nevertheless good news for US exports to China, given burgeoning US dollar strength, driven by Fed exit talk. In between are Australian exporters who will be delighted to see the Aussie weak and renminbi<\/span> strong. Not so for the importers of cheap Chinese goods.<\/p>\n \n\tWall Street was closed last night as the US enjoyed the Memorial Day long weekend. It was also a long weekend in the UK, so no LME<\/span> metals markets. Some commodities continue to trade electronically nevertheless, for those not on holiday, so Brent crude was down a smidge<\/span> to US$102.39\/bbl<\/span> and West Texas was down US38c<\/span> to US$94.15\/bbl<\/span>. Gold rose US$3.00 to US$1394.40\/oz on a slightly weaker US dollar index, at 83.64.<\/p>\n \n\tSpot iron ore took a tumble in China, falling US$2.30 to US$120.90\/t.<\/p>\n \n\tThe SPI<\/span> Overnight fell 13 points or 0.3%. \n\tAll overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX<\/span> and more available in the FNArena<\/span> Cockpit. Click here<\/a>. (Subscribers can access prices in the Cockpit.)<\/em><\/p>\n \n\tAll paying members at FNArena<\/span> are being reminded they can set an email alert specifically for The Overnight Report. Go to Portfolio and Alerts in the Cockpit and tick the box in front of The Overnight Report. You will receive an email alert every time a new Overnight Report has been published on the website.<\/em><\/p>\n
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