Australian shares lose 2.5 per cent for the week, the worst weekly return since the end of November last year, as investors fret over the outlook for the global economy.

4.55pm: And here it is: the end of the week stocks wrap. Good weekends all.

4.40pm: All right, one last comment - this time about the dollar:

ANZ global head of FX strategy Richard Yetsenga said the Chinese economic data pummelled the Aussie dollar this afternoon. “Everything was weak,” he said.

Mr Yetsenga said that in the current climate scheduled economic data is not the biggest risk for the dollar but rather unscheduled events.

“In Spain, there is the possible bank recapitalisation package,” he said. “The issue there is - will the market assess that Spain has actually realised big enough losses (with its banks)?” That is due to be released later today, Spain time.

"The second issue is what’s going on with Greece? Will the coalition government be formed or not."

Should the dollar fall under parity with the greenback - where there is a lot of support - it would likely have a “big move down,” Mr Yetsenga said. He declined, though, to have a punt on how far it might sink.

4.35pm: That's almost it for the Markets Live blog for the week. We'll point you to the evening markets wrap when it lands.

Look out for the return of our live coverage on Monday at 9.30am AEST. In the meantime, have a good weekend (and may your team win. Thinking 'Dons' here.)

4.32pm: Oddly enough, the index of gold mining stocks rose 1.5 per cent today. That's despite spot gold prices continuing their retreat - to be down to $US1583 an ounce in recent trade.

Oil futures are also dropping after the weakest Chinese factory out grew at its slowest pace in three years in April. New York oil futures are down to $US96 a barrel, while Brent is down below the $US112 mark.

4.25pm: Last time the dollar fell below parity was December 21 - in other words, the dollar is at its lowest point in 2012.

4.19pm: The dollar, meanwhile, has just touched its lowest point for the year against the greenback, at $US1.0029. Might drop below parity tonight.

For the week, the dollar is off about 2.2 per cent (with a few hours to go) - that's the biggest weekly retreat since the end of November last year (matching the stocks.)

4.17pm:For the day, financials lost 0.4 per cent, materials gave up 0.5 per cent, while consumer staples added 0.8 per cent.

4.16pm: All Ords end down 11 points, or 0.3 per cent for the day, at 4342.7 points.

4.13pm: ASX200 ends down 10.5 points, or 0.2 per cent for the day, at 4285.1 points. That's a loss of 2.5 per cent for the week.

4.08pm: Here, by the way, is what you can look forward to in Australia next week: Business calendar for May 14-18.

4.06pm: Will have the closing numbers here shortly.

In the meantime, European stock markets are poised to slide at their open, with drops of about 0.8 - 1 per cent expected.

3.58pm: Bit more from China - and a bit more bad news for Australia's commodity exporters:

China's real estate investment rose 18.7 per cent in the first four months from a year earlier, down from an annual increase of 23.5 per cent in the first quarter, the National Bureau of Statistics said, Reuters reports.

Revenue from property sales in the country fell 11.8 per cent in the January-April period from a year earlier, compared with an annual drop of 14.6 per cent in the first three months, the agency added in a statement published on its website, www.stats.gov.cn.

In other words, investment is still growing even though sales turnover is shrinking. That presumably is not the right balance of things.

3.47pm: And here's why the dollar is easing back, along with the local share market:

China's factory output rose by 9.3 per cent in April compared with March's 11.9 per cent, sharply underperforming expectations as cooling demand at home and abroad dragged on production growth, the National Bureau of Statistics said - as Reuters reports.

Economists polled by Reuters had expected industrial production growth to stabilise at 12.0 per cent in April from a year earlier.

Continued difficulty in access to loans has led to a softening in fixed-asset investment, which increased 20.2 per cent in the January-April period from a year earlier, compared with an annual rise of 20.9 per cent in the first three months.

Retail sales also underperformed market expectations for an annual growth of 15.2 per cent, rising instead by 14.2 per cent in April from a year earlier.

The data confirms expectations that the world's No. 2 economy is losing steam.

3.42pm: The Australian dollar may yet touch parity. It's down to as low as $US1.004 in recent trading.

3.36pm: Among the banks, ANZ shares are off 0.4 per cent today, Westpac 0.3 per cent, CBA just 0.1 per cent, while NAB is now 0.1 per cent higher for the day.

3.30pm: ANZ is also in the news for another reason:

The High Court will hear a class action by customers of the ANZ Bank alleging it charged excessive fees for overdrafts, overdrawn accounts, dishonour fees and over-the-limit credit card accounts.

High Court judges agreed on Friday to take the case rather than leave it in the Federal Court.

Lawyer Paul Gillett, a senior associate with law firm Maurice Blackburn, said this was an important victory for those involved in the class action, allowing it to bypass the Federal Court to go straight to where it ultimately needed to be heard, in the High Court.

(Read the longer version here.)

3.25pm: Not very helpfully, ANZ is yet to disclose what they plan to do on deposit rates. (Am guessing that will mean the rate reduction is a lot closer to the RBA's 50 basis-point rate cut.)

3.14pm: Here's the fuller ANZ story, as filed by BusinessDay's Chris Zappone: ANZ cuts rates.

3.05pm: ANZ just cut its standard variable mortgage rate by 37 basis points to 7.05 per cent, effective from May 18. More soon.

2.59pm: Among the market indices, financials are down 0.3 per cent, materials are down 0.4 per cent and industrials are 0.1 per cent lower. After some heavy losses yesterday, gold stocks have bounced back and are up 1.6 per cent.

2.50pm: Entrepreneur Dick Smith says foreign retail giants Aldi and Costco are pushing local producers out of business with ''capitalist'' business models.

Mr Smith says competition pressure from foreign-owned stores makes it harder for local producers to sell to Australian supermarkets Coles and Woolworths.

German-owned Aldi had a greater turnover of stock and consistently offered below-cost products from overseas, he told a Senate inquiry into Australia's food-processing sector in Canberra.

Local producers couldn't match the low prices and were pushed out.

''Then they put the price back up again,'' Mr Smith told the committee hearing.

The operator of Dick Smith Foods, which markets Australian-grown products, said these pricing practices made it hard for him to compete against famous brands - including Cottee's, Arnott's, Golden Circle and Edgell - that were now foreign-owned.

It was a characteristic of capitalism that it didn't create competition but removed it, he said.

He also blamed Aldi and US chain store Costco for last year's milk price war, sparked by Coles slashing the price of milk to $1 a litre.

''I think Coles and Woolworths are reacting to the situation where we have encouraged Aldi and Costco to come here.''

2.37pm: Following from an earlier post on Sony... shares in the Japanese electronics giant and its rival Panasonic have plunged to their lowest levels in more than three decades as investors fret about the future prospects for two of Japan's most iconic firms amid massive losses.

Sony, which reported a record $US5.7 billion annual loss Thursday, has fallen 5.11 per cent to 1151 yen, while Panasonic is off 1.55 per cent at 570 yen. It reports its earnings later today and has warned it may show a record yearly loss.

By midday in Japan, the firms' shares stood at their lowest level since September 1980, taking into account previous stock splits, according to the online edition of the Nikkei business daily.

Meanwhile Sharp shares are trading at year lows, having fallen 4.4 percent to 393 yen.

2.29pm: What does it take to have a job in Australia?

Turns out just 60 minutes employment in the particular week of the month that the number crunchers in Canberra are out in force are all one needs to appear in the "employed" half of the ledger, writes Chris Zappone.

Full story here.

2.21pm: The High Court will hear a class action by customers of the ANZ Bank alleging it charged excessive fees for overdrafts, overdrawn accounts, dishonour fees and over-the-limit credit card accounts.

High Court judges have agreed to take the case rather than leave it in the Federal Court.

Lawyer Paul Gillett, a senior associate with law firm Maurice Blackburn, said this was an important victory for those involved in the class action, allowing it to bypass the Federal Court to go straight to where it ultimately needed to be heard, in the High Court.

''This decision will save time, money and resources for the courts and the parties involved, allowing everyone's energies to be better spent,'' he says.

2.11pm: The dollar, meanwhile, is still resisting a slide back to parity with the greenback - it's at $US1.0065. Track its movements - and other currencies - at this link.

2.06pm: A couple of hours out from the close of trade for the week, stocks are trending higher but are still in negative ground for the session. The ASX200 is now down 10.6 points, or 0.2 per cent, to 4285.

1.57pm: Yahoo! chief executive Scott Thompson, at the centre of a row over his educational qualifications, told his top executives he never provided a resume or incorrect information to Yahoo!, a source familiar with the situation says.

Reuters reports that Thompson held a meeting with senior staff to address the controversy that erupted a week ago, and has caused turmoil at the struggling internet company and raised questions about his future as CEO.

Yahoo! acknowledged last week that Thompson, the former president of eBay division PayPal, does not have a computer science degree, despite what was stated in his official company biography and in regulatory filings with the US Securities and Exchange Commission.

1.47pm: Alesco is again urging shareholders to take no action on the $188 million takeover offer from Dulux Group.

The paint and garden-care products supplier released its bidder's statement on Thursday outlining the reasons why it believes Alesco's shareholders should accept its offer.

Dulux launched the surprise $2.00-a-share bid on May 1, saying it wanted to enlarge its market footprint in Australia.

But Alesco chairman Mark Luby is asking shareholders to wait until company directors responded formally to the bid through a target statement.

''In assessing this, or any alternative proposals, the board will focus on maximising Alesco shareholder value,'' he says.

1.38pm: Gold prices, meanwhile, have slipped more than half a per cent and are on track for their worst weekly fall since March on weaker euro and equities, as investors failed to shake off worries about Europe's debt crisis threatening global economic growth.

Gold, though traditionally seen as a safe haven, bore the brunt of the sell-offs across risk assets such as equities, industrial metals and oil this week, forcing investors and speculators to sell bullion to cover losses in other markets.

Gold has eased $6.72 an ounce to $US1587.01 after shares in Asia were hit by JPMorgan's $US2 billion loss from a failed hedging strategy and by political turmoil in the euro zone.

1.30pm: Oil prices have fallen, weighed down by disappointing Chinese trade data and an increase in crude production by the OPEC cartel, analysts say.

New York's main contract, West Texas Intermediate crude for delivery in June, is down 94 cents to $US96.14 per barrel while Brent North Sea crude for June has shed 81 cents to $US111.92.

"Weaker-than-expected Chinese trade data, higher OPEC production and evidence of a strengthening US jobs market muddied the oil demand outlook," says Phillip Futures in a market commentary.

1.18pm: A permanent police presence is about to be established at Woodside Petroleum's Browse gas hub site near Broome to deal with an expected ramping up of protests against the development.

Work on the James Price Point project has resumed now that the wet season has ended.

ABC Radio reports there are plans to station more than 100 police indefinitely at the site in anticipation of an influx of environmental activists.

1.08pm: Slater & Gordon says it will book a $10 million non-cash writedown after the High Court decided not to grant its client leave to appeal a full Federal Court decision in the Vioxx class action.

The listed law firm says the writedown, to be reflected in the full year 2011/12 accounts, had ''no cash impact as these costs have been incurred and funds expended''.

Slater & Gordon shares, which were placed in a trading halt prior to the High Court announcement, are down eight cents, or 4.49 per cent, at $1.70 after resuming trade.

1pm: Trans-Tasman casino operator SkyCity Entertainment group has downgraded its profit expectations following weaker trading conditions, especially in Adelaide.

SkyCity said in February that it expected its normalised net profit after tax for the year ended June 30, 2012 to be in the ''high $NZ140 millions'', after good growth across the group.It now expects that normalised net profit after tax would be in the ''low $NZ140 millions''.

12.55pm: The woes continue for electronics giant Sony. After its shares fell to their lowest level in 25 years this week, it has now reported a record full-year loss of $US5.7 billion, but vows it will swing back into the black this year as it embarks on a huge restructuring plan.

Sony, which is struggling to stem losses at its television division, says a strong yen and natural disasters were among the main reasons for its disastrous earnings.

"Sales decreased... primarily due to unfavourable foreign exchange rates, the impact of the Great East Japan Earthquake (in March 2011)... the floods in Thailand, and deterioration in market conditions in developed countries," it says.

The natural disasters hammered Japanese manufacturers while Sony has also blamed tough competition and falling prices, particularly in the television segment, for its struggles.

12.43pm: Bit of a lunchtime read on PPPs: Two privatisations, neither quite as they seem, writes Michael West.

One, the Ararat Prison Project in Victoria, is being hammered as a government disaster when it is really an example of genuine risk transfer by the state.

The other, the sale of the Sydney desalination plant, is hailed as a triumph when consumers have been locked into buying water they don't need for the next few decades.

PPPs are criticised, and often justly, for transferring wealth from taxpayers to the private sector. And the private sector regularly gets the upper hand in negotiations. But a PPP deal cuts both ways.

12.29pm: The local market isn't the only suffering losses, most regional bourses are also in the red. The MSCI Asia Pacific Index is down 0.6 per cent, heading for its biggest weekly loss in almost six months amid renewed worries over Europe's debt crisis.

South Korea’s Kospi Index fell 1 per cent and Taiwan’s Taiex Index declined 1.2 per cent. Japan’s Nikkei 225 Stock Average swung between gains and losses.

China’s Shanghai Composite Index fell 0.4 per cent, while Hong Kong’s Hang Seng Index decreased 1 per cent.

Futures on the Standard & Poor’s 500 Index are down 0.7 per cent as investors assess the disclosure by JPMorgan of a $US2 billion trading loss on synthetic credit securities after an ‘‘egregious’’ failure in its chief investment office.

12.16pm: Facebook's record IPO is already oversubscribed, Reuters quotes a source familiar with the share listing as saying, days after the world's largest social network embarked on a cross-country roadshow to drum up investor enthusiasm.

Despite concerns about slowing growth, a lofty valuation and signs the company is having trouble ramping up revenue from mobile advertising, institutional investors have so far indicated demand for more shares than Facebook has available, the source told Reuters.

Analysts say the company, which is seeking to raise about $US10.6 billion by selling more than 337 million shares at $US28 to $US35 apiece, may raise that price range if demand turns out to be healthy enough.

12.04pm: The dollar has dropped to the day's low of $US1.0044, drawing little help from slightly above-forecast China inflation data.

The next focus will be on Chinese industrial output and retail sales figures due at 3.30pm after yesterday's disappointing trade data.

"The Aussie is likely to track Shanghai shares' reaction to data today," says a trader at a European bank. Shanghai shares hit a two-week low after CPI data, now down 0.4 per cent.

11.55am: Oil is sliding this morning, prompting a turnaround in the energy sub-index, which is currently down 0.5 per cent, after rising 0.4 per cent in early trade.

US crude for June delivery is down $US1.04 at $US96.04 a barrel, after hitting a low of $US95.98, resuming its downturn after ending a six-day slide on Thursday. Brent crude dropped 82 cents to $US111.91.

11.40am: China’s consumer prices rose 3.4 per cent in April from a year earlier, moderating slightly from 3.6 per cent in March.

The CPI came in about as predicted, while the producer-price index declined 0.7 per cent, slightly more than economists were expecting.

Retreating inflation has led investors to speculate that China may lower banks' required reserve ratio by another 150 basis points to 19 per cent before the end of this year to encourage banks to lend more to cash-strapped firms.

Premier Wen Jiabao pledged in March to hold inflation within about 4 per cent this year after gains surged to a three-year high in July as food costs climbed.

11.30am: The market is still dropping, now down about 0.4 per cent. Leading the decline are bank stocks, with investors spooked by news from JPMorgan Chase that it suffered a $US2 billion trading loss from a failed hedging strategy.

The big four banks are between 0.4 per cent and 0.9 per cent weaker, led down by National Australia Bank.

"It creates these uncertainties in the market and people at the moment jump at anything, particularly when JPMorgan has been held up as being clean and doing the right thing," says Burrell & Co director Richard Herring.

11.20am: The market is bracing for the next round of Chinese economic data, which is hoped to shed a light on how Australia's biggest trading partner is faring and if more monetary easing can be expected.

China’s consumer price index and producer price index report for April are due out at 11.30am, while industrial production and retail sales for the same month are slated for publication at 3.30pm.

‘‘It looks like a sanguine kind of a day until we get fully seized of the China situation," says Bell Potter senior adviser Stuart Smith.

11.12am: Telstra has appointed Robert Nason as chairman of Foxtel, replacing Bruce Akhurst who is retiring.

Nason, a former Tabcorp executive, is currently Telstra’s group managing director of business service and improvement and has been a member of the Foxtel board since March.

Joining Nason on the Foxtel board will be Telstra’s group managing director for innovation, products and marketing, Kate McKenzie, who will take the board seat currently held by Nason.

Under the terms of the Foxtel partnership with News Ltd and Consolidated Media Holdings, Telstra has the right to appoint the chairman.

11.02am: Here are some of the most active stocks in early trade:

  • Alacer Gold - declines 2.8 per cent to $6.84 after Bank of America downgraded shares of the metal producer to ‘‘underperform’’, citing concern that the company will continue with its expansion in the South Kal goldfields in Western Australia.
  • Caltex Australia - slides 0.9 per cent to $13.27 after Citigroup downgraded shares of the country’s biggest oil refiner to ‘‘sell’’.
  • Invocare - climbs 1.5 per cent to $8.29 after the funeral homes operator said sales rose 27 per cent in the four months through April.
  • Mirabela Nickel - surges 22 per cent to 31.5 cents after chief executive Ian Purdy told the Australian Financial Review that its debt situation is ‘‘rock solid’’. Shares of the nickel producer fell 38 per cent this week through yesterday amid concern that the company may sell new shares to raise funds.
  • Whitehaven Coal - gains 1.5 per cent to $4.75 after Bank of America gave the shares a ‘‘buy’’ recommendation in new coverage with a price estimate of $6.46. That’s more than a 38 per cent premium to yesterday’s closing price for the coal producer.

10.58am: BHP Billiton’s Petrohawk Energy has reported a widening of its first-quarter loss after natural gas prices fell.

The loss was $US55 million in the three months to March 31, compared with a loss of $US29 million a year earlier.

BHP's shares are down 0.2 per cent at $34.55 – less than $1 from its 52-week low of $33.59 touched on April 11.

BHP may write down the value of its US gas assets by as much as $US5 billion due to lower prices when it reports full-year profit, Citigroup said in a report May 1.

10.50am: The dollar is trading at $US1.0070, slightly higher than earlier this morning, but still down from late yesterday.

‘‘The Aussie is unfortunately a victim of any sign of global uncertainty,’’ says Nomura forex sales director Kurt Magnus. ‘‘The catalyst for weakness was certainly the unfortunate news about JPMorgan’s losses. There is support in the Australian dollar on the day at $US1.0050.’’

10.46am: So much for that bit of early optimism - shares are back in the red and plumbing the day's lows. Banks are leading the way down, with the financials sub-index losing 0.4 per cent.

10.35am: Risk appetite will remain muted largely due to heightening political and policy uncertainty in the eurozone, Morgan Stanley says.

"We expect the EUR to remain under pressure as a result, especially as the market debate regarding the use of the EUR as a policy tool gains momentum," suggesting that a rate cut aimed at weakening the euro is likely, the bank's economists write in a note.

10.28am: Similarly to the local market, Japan's Nikkei steadied in early trade, ahead of China’s industrial output and inflation data, which will give further clues to the health of the world’s second largest economy.

The Nikkei was recently up 0.1 per cent at 9017.41, while the broader Topix was flat at 765.69.

10.17am: These are the main contributors to the ASX200's gains in early trade:

  • Newcrest - up 21 cents to $25.34
  • Woodside - up 21 cents to $33.61
  • CSL - up 24 cents to $37.69

And here are the main drags (not surprisingly they're all banks):

  • ANZ - down 11 cents to $22.04
  • NAB down 11 cents to $24.46
  • Westpac down 7 cents to $22.83

10.14am: Here's how the major sectors are doing in early trade:

  • Materials: +0.1%
  • Financials: -0.1%
  • Energy: +0.4%
  • Consumer staples: +0.2%
  • Consumer discretionary: +0.2%
  • Industrials: +0.2%
  • Telecommunication: flat

10.10am: Investors seem to have decided that JPMorgan isn't all that relevant to the local market, pushing shares higher after those initial wobbles.

10.05am: And we're off to the expected slightly lower start. The benchmark S&P/ASX200 index is down 3.3 points, or 0.1 per cent, at 4292.3, while the broader All Ords has slipped 3.6 points, or 0.1 per cent, to 4350.2.

9.59am: The dollar is trading at $US1.0059, down from US1.0098 in early trade this morning.

9.55am: In other news, New South Wales has signed a $2.3 billion deal with a consortium of Hastings Funds Management and Ontario Teachers Pension Plan for the long-term lease of a desalination plant in Sydney, Reuters quotes a source as saying.

Morgan Stanley and RBC Capital Markets advised the international consortium which will pay $300 million more than the plant's regulated asset base.

Under the agreement, Sydney Water is locked into a 50-year water supply agreement with the owners of the new plant. The 50-year lease will include the desalination plant, the pipeline and the site.

The consortium beat short-listed bidders Industry Funds Management and Spark Infrastructure Group to the deal. Mitsubishi Corp and Acciona dropped out of the running earlier.

9.49am: Twitter is abuzz with reactions to JPMorgan's trading loss:

9.46am: One of the first political reactions to the JPMorgan debacle loss was by US Senator Carl Levin, who is the chairman of the Senate Permanent Subcommittee on Investigations helped write the Volcker Rule, saying the loss is a reminder why we need tougher banking regulation:

The enormous loss JP Morgan announced today is just the latest evidence that what banks call 'hedges' are often risky bets that so-called 'too big to fail' banks have no business making. Today’s announcement is a stark reminder of the need for regulators to establish tough, effective standards to implement the Merkley-Levin language to protect taxpayers from having to cover such high-risk bets.

9.43am: The bank's errors are especially embarrassing in light of Dimon's public criticism of the so-called Volcker rule to ban proprietary trading by big banks.

"It plays right into the hands of a bunch of pundits out there, but that is life," Dimon said. He said he still believes in his arguments against the Volcker rule. The problem at JPMorgan, he said, was with the execution of the hedging strategy.

The strategy "morphed over time" and it was "ineffective, poorly monitored, poorly constructed and all of that," Dimon said. "This violated our principles. This trading violates the Dimon principle."

9.39am: JPMorgan's dollar loss, though, could be less significant than the hit to Dimon and the bank's reputation. JPMorgan had $2.32 trillion of assets supported by $190 billion of shareholder equity at the end of March. The bank is the biggest in the United States by assets.

"This puts egg on our face," Dimon admitted in a hastily organised press conference.

JPMorgan has been viewed as a strong risk manager after never reporting a loss during the financial crisis and being the bank that was strong enough to take over investment bank Bear Stearns and consumer bank Washington Mutual when they collapsed in 2008.

This announcement could taint that reputation "as well as hurt management's credibility," Barclays analyst Jason Goldberg wrote in a note to clients.

Nancy Bush, a longtime bank analyst and contributing editor at SNL Financial, said, "Jamie has always styled himself as one of the kings of Wall Street," she said. "I don't know how this went so bad so quickly with his knowledge and aversion to risk."

9.34am: JPMorgan chief executive Jamie Dimon said the bank's corporate and private equity segment expects to lose $US800 million in the second quarter and that the loss could "easily get worse". However, the bank's capital plan was not impacted, he said.

JPMorgan's stock fell as much as 6.7 per cent to $US38.00 in after-hours trading. S&P 500 futures fell 11.6 points.

S&P500 futures fell 11.6 points, while Nasdaq 100 futures fell 16.75 points.

9.32am: Australian shares are expected to open flat to slightly lower as US bank JPMorgan flagged losses after the close of trade on Wall Street closed, weighing on fragile investor sentiment.

Local share price index futures slipped 6 points to 4295, after earlier rising on the back of gains on European markets and a small rise on Wall Street.

In a positive development for global markets, eurozone officials said the bloc's countries are prepared to keep financing Greece until the country forms a new government, either after Sunday's election or if new elections are needed next month.

However, US stock index futures slid after Wall Street's close after JPMorgan Chase disclosed it had incurred "significant mark-to-market losses" in April after a hedging strategy failed.

Read more about how overseas markets fared in need2know.

9.30am: Good morning folks. Welcome to the Markets Live blog for Friday.

This blog is not intended as investment advice

Contributors: Jens Meyer, Peter Litras, Peter Hannam

BusinessDay with agencies