THE Australian dollar opened weaker today, after risk appetite waned in offshore trade as US stocks slid following muted earnings reports and weak economic data.
At 7am AEST, the Australian dollar was trading at US86.64c, down from Friday's close of US87.64c.
Since 5pm AEST on Friday, the domestic dollar traded between US88.08c and US86.59c.
HiFX trading director Mike Hollows described the offshore session as turbulent, saying the unit was under sustained pressure as US stocks slid on Friday night (AEST).
"We spent the latter part of last week around the $US0.8850 mark," Mr Hollows said.
"On Friday night we saw a very sharp fall in equities... so there was quite a negative response from a risk perspective."
Weak economic data and poorer-than-expected profit results from companies pushed US stocks lower on Friday night (AEST).
The Dow Jones Industrial Average fell 2.52 per cent to finish at 10,097.90 points.
All 30 of the Dow's blue-chip stocks closed in the red.
Meanwhile, the broad-market S&P 500 index shed 2.88 per cent to 1064.88 points.
Stocks were under selling pressure from the opening bell as investors weighed a conflicting batch of financial results from major companies including Google, Bank of America, Citigroup and General Electric.
Investors also had to contend with the University of Michigan's consumer sentiment index, which dropped by a steeper than forecast 9.5 points in July to 66.5 points, its lowest reading since August 2009.
Also over the weekend, Prime Minister Julia Gillard called a federal election for August 21 in a move that was widely expected.
Mr Hollows said he did not expect the decision to affect the local unit.
"It's not going to have a major part to play," he said.
Investors would turn their attention to Tuesday's expected release of the minutes of the Reserve Bank of Australia's (RBA) July board meeting.
The central bank left the cash rate steady at 4.5 per cent on July 6, but governor Glenn Stevens's accompanying statement was seen at the time as hinting at an August rate rise.
Mr Hollows said that expectation has died down since.
"I think the RBA is on hold for the forseeable (future)," he said.
"We're going to be driven by the US corporate reporting season."
Meanwhile, the Australian share market opened lower today after stocks in the United States plunged on Friday.
On the domestic bourse, banking, mining and energy stocks retreated.
At 10.12am AEST, the benchmark S&P/ASX200 index was down 64.9 points, or 1.47 per cent, at 4357.8 points, while the broader All Ordinaries index fell 62.9 points, or 1.42 per cent, to 4374.1 points.
On the Sydney Futures Exchange, the September share price index futures contract was 69 points lower at 4337 points, with 6638 contracts traded.
In early news today, private hospitals operator and pathology provider Healthscope agreed to a $2.7 billion offer from private equity firms Carlyle Group and TPG Capital.
Healthscope's board unanimously recommended the $6.26 per share cash offer.
Healthscope shares were in a trading halt, having last traded at $5.40.
Wealth manager AXA Asia Pacific Holdings and National Australia Bank announced that they had extended the deadline for negotiating a solution to takeover concerns raised by the consumer watchdog until the end of August.
The two parties, along with AXA APH's parent, France-based AXA SA, also have extended the deadline by which they must achieve court approval for NAB's takeover of AXA APH to the end of January next year.
AXA shares were one cent lower at $5.24.
Investment company Djerriwarrh Investments posted an annual profit of $25 million, down on a revised result from last year due to lower dividend payouts.
Djerriwarrh shares were steady at $4.14.
On Wall Street on Friday, sagging consumer confidence and a mixed batch of second-quarter earnings revived fears about the health of the economic recovery.
The Dow Jones Industrial Average tumbled 261.41 points, or 2.52 per cent, to 10,097.90.
All 30 of the Dow's blue-chip stocks closed in the red.
The broader S&P 500 index shed 31.60 points, or 2.88 per cent, at 1064.88 while the tech-heavy Nasdaq composite index dropped 70.03 points, or 3.11 per cent, to 2179.05.
Stocks came under pressure as investors weighed a conflicting batch of financial results from major companies including Google, Bank of America, Citigroup and General Electric.
Adding to economic recovery concerns was the University of Michigan's consumer sentiment index, which dropped almost 10 points - far steeper than forecast - to 66.5 in July, its lowest reading since August 2009.
