Australian Stock Market Report – Afternoon 11/18/13

EVENING REPORT
(5pm AEDT)

Despite improving gradually as the day wore on, the All Ordinaries Index (XAO) still finished 0.3 per cent lower by market close. At its worst, the XAO was down by 0.78 per cent (at around 10.30am AEDT). All sectors eased, with the financials and energy stocks amongst the biggest drags.

Warrnambool Cheese and Butter (WCB) resumed trade after being in a halt on Friday. WCB's board unanimously recommended shareholders accept a new, sweetened Saputo offer. The Canadian food giant made a $9 per share off to take over the Australian dairy processor. Bega Cheese (BGA), which is one of three interested parties released an announcement to the ASX saying it will hold information sessions with WCB shareholders on Tuesday 19 Nov and Wednesday 20 November (to be held at Warrnambool, Mt Gambier and Ballarat). WCB shares are up by 158 per cent since the start of this calendar year and rose by 2.1 per cent today.

Qantas Airways (QAN) slumped by 1.67 per cent while its competitor, Virgin Australia (VAH) fell by a more significant 3.7 per cent. QAN has asked the federal government to stop a $350 million foreign capital injection into VAH. QAN sees this investment as an acceleration of a gradual foreign takeover of Australia's second biggest airline. This cash injection could take Air New Zealand, Singapore Airline and Etihad's ownership to 72 per cent. 85 per cent of VAH is owned by foreign firms.

Steel producer, Arrium (ARI) surged by 7.9 per cent after announcing record quarterly shipments of 3.13Mt (94 per cent higher than the prior corresponding quarter). ARI shares have jumped by 80.2 per cent since the start of this calendar year.

No major economic news was released in Australia or the region today. Keep an eye on the Reserve Bank board meeting minutes tomorrow. Over the next four days, Myer, David Jones, BHP Billiton (BHP), Paladin and Kathmandu will hold their AGMs with shareholders.

At the close, 1.65 billion shares were traded, worth $3.36 billion. 399 stocks were higher, 581 finished weaker and 352 were unchanged.

Tonight in Europe - current account and the trade balance are out. In the US - net capital flows and a builders' index will be issued. Neither of these are typically market moving.

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