Australian Stock Market Report – Afternoon 10/19/2011

AFTERNOON REPORT (4.30pm AEDT)

The volatility continued for investors today, with the local stock market attempting to recover some of yesterday's losses. The All Ordinaries Index (XAO) rose 25.3pts or 0.6pct to 4274.8, notching up its second win of the week. Sentiment was boosted by a newspaper report from the UK's The Guardian which suggested France and Germany have agreed to increase the size of the European stability fund to two trillion Euros.

Financial stocks were among the best performers, with the S&P/ASX 200 Financials Index up 1.2pct. Shares in Westpac (WBC) rose 1.3pct to $21.85 while the Commonwealth Bank (CBA) added 1.2pct to $48.01. Macquarie Group (MQG) was down 1.7pct to $23.80.

Mining stocks were the biggest drag on the overall market. Base metals prices slumped overnight as Chinese economic data suggested growth in the world's second largest economy is slowing. Shares in Rio Tinto (RIO) fell 1.8pct to $65.08 while Fortescue Metals Group (FMG) was down 2.6pct to $4.52. Index leader BHP Billiton (BHP) today came out with quarterly production figures, reporting a higher than expected 24pct increase in iron ore output. However the miner signalled a further drop in copper output at its Escondida mine in Chile. BHP shares finished the day steady at $36.40.

Caltex (CTX) shares in the energy sector rose nearly 6pct, finishing the day's trade at $13.53.

Online travel agency Webjet (WEB) held its AGM today, forecasting 10pct annual growth after reporting a 23pct rise in the quarter, year on year. WEB shares rose 2.7pct to $2.26.

Vaccine maker CSL Limited (CSL) added 1.1pct to $30.53 after affirming 10pct FY12 growth at its AGM.

Elsewhere in the healthcare sector, a massive 144pct rise from Living Cell Technologies (LCT) after the company signed a $25 million joint venture with a Japanese company, Otsuka Pharmaceuticals, to speed up a new diabetes therapy. The cost of the venture will see the cell implant therapy be refined and checked in clinical trials in New Zealand, Russia and Argentina. Diabecell is expected to bring relief to millions of diabetes sufferers. LCT shares closed at $0.105.

The Australian dollar ended the day's trade at US103.32c, £0.6554 and €74.73c.

On the market overall, a total of 1.67 billion shares were traded, worth $4.59 billion. 579 were up, 437 were down and 306 were unchanged.

At 4.30pm AEDT on the ASX24, the futures contract was at 4217, up 32pts.

Ahead tonight, consumer prices, housing starts and the Federal Reserve Beige Book are released in the US. Morgan Stanley and American Express are among the companies releasing earnings results.

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