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Poor employment numbers rattle the Aussie Dollar

15:02 AEST, Thursday 13 February 2014

Poor employment numbers rattle the Aussie Dollar and keep stocks in limbo
By Betty Lam (Sales Trader, CMC Markets)

Exhibiting signs of exhaustion, the Aussie market took some time to wipe the sweat off its brow after the previous five sessions of climbing. Local stocks spent a majority of the morning making a slow ascent, with traders holding off any real commitment until after the local employment data was released. Pre-lunch brought a double barrel of disappointment, in the form of employment readings. The unemployment rate was worse than the market had forecast, coming in at 6.0%, the highest in over 10 years. The six prefix sent Aussie stocks and dollar alike into a tailspin. Local equities plunged a solid 30 points following the news and dominated investor sentiment for the remainder of the session.

In afternoon trading, the market is suspended in limbo, swinging between in mild losses and mild gains. The big four banks placed downward pressure on the Aussie 200, as investors eased their foot off the buying-accelerator. The reporting calendar was bursting at the seams again today, with plenty of big names featured on the agenda. Telstra narrowly beat analyst expectation and raised their dividend for the first time in nine years. The stock is up 0.6% over the session. Mining heavyweight RIO is due to present its full year profit earnings after the closing bell and given its size is likely to affect investor sentiment towards the resource sector in general.

After the IMF’s comments last night suggesting the Aussie dollar is trading at elevated levels and needs to depreciate by about 10%, the currency reacted very stubbornly. After this week’s re-entrance into 90-zone, the dollar remained static within the early US0.90 ranges until unemployment numbers were unleashed. Unexpectedly poor employment data shot the dollar back almost a whole cent, it is currently sitting at around the US0.893 mark. Dollar stickiness to this range may be dependent on retail sales and jobless claims statistics due tonight.

ENDS

© Scoop Media

 
 
 
 
 
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