Choppy week tipped for Aust market

The Australian sharemarket is expected to open slightly lower on Monday ahead of what could be a volatile week.

CommSec senior analyst Craig James says futures markets are indicating a two-point loss at the local open following falls in commodity prices.

Recent drops in oil, base metal and iron ore prices had affected the Australian market, he said.

"When you think about the mining and energy sectors, they've got few positives to key off there," he said.

"In fact Canada's Toronto market, which has a lot in common with our market, actually ended down by almost seven points, so I think that's what investors are looking at in terms of the lead-in to our market."

Mr James is tipping Australian stocks to shake off the flat start but says it could be a volatile week as the market reacts to the release of key data.

Chief among these is national employment figures due on Thursday.

A fall in unemployment would likely push the Australian dollar out of the 93-94 US cent range it has been hovering in.

"That's the big test - we saw a sharp rise in the unemployment rate last time around," Mr James said.

"If we see a significant lift in employment and that unemployment rate coming back down then the Aussie dollar could test 94 cents again."

Chinese economic data, including trade figures on Monday, liquidity money supply data and other key results could also have an impact.

"It's very, very hard to say how we're going to progress this week. It could end up being quite a choppy week," Mr James said.

On Friday, the benchmark S&P/ASX200 index dropped 32.6 points, or 0.58 per cent, to 5,598.7 points, while the broader All Ordinaries index shed 33.2 points, or 0.59 per cent, to close at 5,598.9 points.

Iron ore dropped below $US85 a tonne in China for the first time in five years, to $US84.30.