Steel yourselves. Our market is poised to suffer its sixth consecutive day of losses if traders are right.
The futures market is pointing to a 0.67% decline in the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) this morning as Australian equities are expected to follow US and European stocks lower.
Most commodities also retreated although iron ore managed to buck the trend. The Metal Bulletin reported a 2.6% increase in the steel making ingredient to $US63.02 a tonne – its highest level in nearly three months.
It's hard to see much bargain hunting happening today as we wait for the release of the federal budget at 7.30 tonight.
While the bears are likely to dominate trade today, mining companies should again be able to outperform the banks with National Australia Bank Ltd. (ASX: NAB) expected to suffer a big fall as it resumes trade today.
The bank went into a trading halt to undertake the largest capital raising in the history of the ASX. The $5.5 billion raising was priced at a 19% discount to its last traded price of $35.20 and the stock should tumble towards the offer price, although I am not anticipating that it will fall below that.
Resource stocks have been lagging financials by a country mile but their fortunes have started to turn with the embattled sector overtaking financials since the start of the month.
This is likely to continue as bank stocks will be weighed down by expectations that the other big banks will have to follow NAB's lead in tapping investors on the shoulder for cash.
All eyes are also on iron ore producer Atlas Iron Limited (ASX: AGO) as its trading suspension runs out today. Unless it requests for another extension, the stock could resume trade if it has successfully pulled off a restructure.
On the earnings front, explosives maker Orica Ltd (ASX: ORI) is expected to release its first half earnings this morning. There's a fair amount of nervousness in the wake of rival Incitec Pivot Ltd's (ASX: IPL) poorly received profit report yesterday.
Incitec's share price tumbled 3.3% to $3.78 on Monday and is expected to stay under pressure with Credit Suisse downgrading the stock to "underperform" from "neutral".
Building products supplier CSR Limited (ASX: CSR) will be in the earnings spotlight. The company is expected to release its full year results today.
In other corporate news, port & logistics companies Asciano Ltd (ASX: AIO) and Qube Holdings Ltd (ASX: QUB) are looking to bid for the Port of Darwin, according to the Australian Financial Review, while fund manager Perpetual Limited (ASX: PPT) has upped its stake in Genworth Mortgage Insurance Australia (ASX: GMA) to 15% from 8.5%, after Genworth's parent company sold its 14.2% holding at $3.08 a share yesterday.
Beverage giant Coca-Cola Amatil Ltd (ASX: CCL) will also be closely watched as it hosts its annual general meeting.
