Watch our market get whacked today by yet another nasty fall in the iron ore price after weak Chinese housing data for October showed house prices falling faster than before.
The spot iron ore price for standard Australian iron ore (62% iron content) overnight Tuesday fell 4.4% to a new five year low of $US71.80 (around $A82).
The local market fell yesterday in weak trading with the ASX 200 down 12.8 points or 0.2% to a three-week low of 5,399.7.
The market will go lower today after the sharp fall in the iron ore price. Gold prices rose 1% overnight, but then eased, while oil prices again dipped under $US75 a barrel.
The Aussie dollar fell tp around 86.80 US cents overnight on comments by Reserve Bank Governor, Glenn Stevens, but it then bounced back to more than 87.20 US cents in early Asian trading.
Wall Street did well, with the S&P 500 hitting yet another record.
But the fall in iron ore prices will dominate here today for local investors, even though the futures contract has the market opening with a small gain, as it did yesterday before selling appeared.
Iron ore prices are now down around 45% so far this year and the weak housing data holds out the prospect of the price falling under $US70 a tonne in the next week or so.
The latest data from China showed new home prices fell month to month (from September to October) in 69 of the 70 cities surveyed and the average price was down 2.6% from a year ago.
In September prices also fell in 69 of the 70 cities surveyed, with the average down 1.3% from a year ago, the first annual fall in two years.
Excluding public housing, private-sector home prices fell in 67 of the 70 cities in October from a year earlier, up from the 58 cities that reporting falls in September
In Beijing last month, house prices fell 1.3%, against the 0.4% rise in September, while in Shanghai the rate of fall accelerated from 0,8% to 2% in October.
For existing residences, 64 of the 70 cities saw price drops last month, with northeastern city of Mudanjiang registering the sharpest fall of 1.8%, according to government websites.
China’s National Bureau of Statistics said property investment continued to cool in the first 10 months, growing 12.4% year on year, down 0.1 percentage points from the first nine months.
In terms of floor space property sales fell 7.8% in January – October, compared with an 8.6% drop in the nine months to September.
And China’s new yuan-denominated lending in October rose to 548.3 billion yuan ($US89.3 billion), up 42.3 billion yuan year on year.
But compared with September, lending fell 308.9 billion yuan, with the weakness in housing blamed for the sharp drop.
