Australian Stock Market Report – Afternoon 10/25/2012

AFTERNOON REPORT
(5pm AEDT)

The US Federal Reserve announced overnight that it would continue with its current economic stimulus program, QE3. The move failed to excite local investors, with the All Ordinaries Index (XAO) finishing only slightly higher, up 2.9pts to 4533.5pts.

The ANZ Bank (ANZ) today announced a record $5.66 billion full year profit, thanks to improved performances from most of its businesses and cost reductions thanks to job cuts. Investors however were clearly expecting more, with the ANZ Bank today down 0.9pct to $25.38. The other big banks fared better, shares in the Commonwealth Bank (CBA) finishing higher by 0.4pct to $57.30.

Mining stocks were mixed today. Despite a gain in the iron ore price (US$118.70 a metric tonne); shares in iron ore miner Fortescue Metals Group (FMG) fell 2.4pct to $2.15. Index leader BHP Billiton (BHP) was slightly higher at $34.37 while Rio Tinto (RIO) shares added 0.4pct to $57.50.

Telstra (TLS) also closed higher, up 1pct to $4.07 while property trusts were well supported on defensive buying; Westfield (WDC) firmer by 1pct to $10.58 and Dexus Group (DXS) up 3.1pct to $1.01.

Wesfarmers (WES) today announced a lift in first quarter sales, boosted by improvement at its Coles supermarket. WES shares closed flat at $34.57, down 0.1pct, while rival Woolworths (WOW) was up 0.5pct to $29.15.

Crown Limited (CWN) today passed the first stage of NSW government approval to build a new one billion dollar hotel in Sydney, containing VIP gambling facilities. NSW currently only has one gambling licence, held by Echo Entertainment Group (EGP) - the owner of Sydney's The Star Casino. EGP shares today dropped 4pct to $3.65 while CWN shares were slightly lower at $9.46, down 0.3pct.

Ratings agency Standard and Poor's today delivered ratings downgrades for the New South Wales and Western Australian economies. Both now have a negative watch - with concerns lower mining royalties could impact WA's fortunes and that debt concerns in NSW could curb its investment in infrastructure.

No economic data was released locally today and the Australian dollar ended the day's trade at US103.67c, €79.77c and £0.6457.

On the market overall, a total of 1.7 billion shares were traded, worth $4.05 billion. 474 were up, 456 were down and 351 were unchanged.

At 4.30pm the SFE 200 Futures was at 4500, up 8pts.

Ahead tonight; pending home sales, durable goods orders and initial jobless claims are released in the US.

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