The Australian share market is trading lower after investors felt some disappointment over the latest moves by the US central bank to boost the US economy.

The US Federal Reserve has extended a program that aims to encourage borrowing and spending by reducing long-term interest rates as it cut its forecast for US growth.

But the Fed has said it was prepared to take more action if needed.

At 1200 AEST on Thursday, the benchmark S&P/ASX200 index was down 22.7 points, or 0.55 per cent, at 4,109.7 points, while the broader All Ordinaries index fell 21.9 points, or 0.52 per cent, to 4,154.9 points.

On the ASX 24, the June share price index futures contract, which expired at noon, was up 13 points at 4,142 with 10,974 contracts traded.

The September share price index futures contract was down 27 points at 4,066 points, 18,889 contracts traded.

OptionsXpress market analyst Ben Le Brun said investors were trying to make up their minds on what the latest Federal Reserve stimulus package meant for the US.

‘‘There might be some slightly disappointed investors and traders as well,’’ Mr Le Brun said. Mr Le Brun noted that the Federal Reserve had said that it stood ready to do more should economic conditions warrant it.

‘‘US markets are only four per cent off their 2012 highs at the moment, so that in itself tells you that conditions aren’t quite right for a full-blown package,’’ Mr Le Brun said.

On the local bourse, in the resources sector, global miner BHP Billiton lost 22 cents to $32.38, and Rio Tinto eased six cents to $57.66.

Among the major banks, ANZ was eight cents lower at $21.67, National Australia Bank reversed 18 cents to $23.27, Westpac dipped six cents to  $21.14, and Commonwealth Bank slipped five cents to $52.04.

Surfwear company Billabong was in a trading halt as it launched a $225 million fund raising venture it says is vital for its future. Billabong last traded at $1.83.

Toy distributor Funtastic was also in a trading halt after it said it has raised up to $24.6 million to reduce bank debt and improve its gearing ratios. Funtastic last traded at 16 cents.

National turnover at 1211 AEST was 1.04 billion shares worth $4.07 billion, with 470 stocks down, 313 up and 352 unchanged.

On Wall Street on Wednesday, the Dow Jones Industrial Average closed 12.94 points, or 0.10 per cent, lower at 12,824.39 points.

Making news today

In economic news:

  • Westpac ACCI survey of industrial trends

In company news:

  • Australian Ethical Investments general meeting
  • Echo Resources general meeting
  • June 2012 share price index futures contract expires
  • Ironbark capital - Record date
  • CI Resources Ltd - Record date
  • Fisher & Paykel Healthcare Corp - Record date
  • Dicker Data Ltd - Ex Div Date

Analyst rating changes:

  • Transfield Services raised to 'hold' at RBS
  • Orica raised to 'strong buy' at BBY Ltd
  • Consolidated Media Holdings kept on hold at Deutsche Bank
  • Alumina still rated as 'neutral' at Citigroup despite doubts on earnings

Offhsore overnight

Bond markets

Spanish and Italian government bonds surged for a second day amid speculation European leaders are seeking ways to reduce the borrowing costs of the region’s lower-rated nations.

  • Spain’s 10-year bond yield fell 30 basis points, or 0.30 percentage point, to 6.74%
  • Italy’s 10-year debt dropped 15 basis points to 5.77%
  • German 10-year bunds slid, sending yields to the highest in six weeks, rising eight basis points to 1.61%

Treasuries fell and US stocks fluctuated as investors weighed plans by the Federal Reserve to boost growth and prospects for stepped-up efforts by European leaders to fight the debt crisis. Crude oil tumbled.

  • US 10-year yields climbed three basis points to 1.65%

United States

US stocks edged lower after the Federal Reserve acted to aid the fragile economy with stimulus measures that were in line with market expectations but went no further.

Key numbers:

  • S&P500 lost 0.17% to 1355.69
  • Dow Jones Industrial Avg lost 0.10% to 12,824.39
  • Nasdaq Composite Index added 0.02% to 2930.45


European stock markets were mixed on Wednesday amid hopes the US Federal Reserve would announce more stimulus to boost the world's biggest economy and as a government emerged in crisis-struck Greece.

Key numbers:

  • London's FTSE 100 added 0.64% to 5622.29
  • In Frankfurt the DAX 30 added 0.45% to 6392.13
  • In Paris the CAC 40 added 0.28% to 3126.52


Asian stocks rose, with the regional benchmark index heading for its highest close in a month, amid speculation the Federal Reserve will expand stimulus measures and after the Group of 20 leaders pledged to support economic growth and help overcome Europe’s debt crisis.

Key numbers:

  • MSCI Asia Pacific Index added 1% to 116.95
  • Japan’s Nikkei 225 added 1.11% to 8752.31
  • Hong Kong’s Hang Seng added 0.53% to 19518.85
  • China’s Shanghai composite lost 0.34% to 2292.88

How we fared yesterday

Australian shares rose slightly today on hopes the Federal Reserve will announce more stimulus measures for the struggling US economy, while locally News Ltd surprised with a takeover bid for ConsMedia.

The benchmark S&P/ASX200 index rose 9.1 points, or 0.2 per cent, to 4132.4, while the broader All Ordinaries index added 9.4 points, or 0.2 per cent, to 4176.8.

BusinessDay with agencies