Australian Stock Market Report – Afternoon 2/6/2013

AFTERNOON REPORT
(5pm AEDT)

The Australian share market rallied today, fighting back after two days of losses and in response to a stellar session on US and European markets. The Dow Jones Index climbed back above 14,000pts overnight while all 10 S&P sectors were higher.

On our market, the All Ordinaries Index (XAO) added 37.9pts or 0.8pct to 4940.5pts.

Financial stocks which have been heavily sold off over the past couple of sessions lost ground, with the sector firmer by 0.9pct. Macquarie Group (MQG) rose slightly to $37.25 after falling yesterday in response to a trading update.

Energy and mining stocks were firm, with Rio Tinto (RIO) up 1.1pct to $68.08 and Santos (STO) firmer by 2pct to $12.10.

On the reporting season front, Primary Health Care (PRY) - a service provider to the medical industry - announced a 50pct jump in first half net profit to $69.5 million and forecast a rise in FY earnings of up to 8pct. PRY shares closed steady at $4.49 after being up by more than 2pct at one stage. Meanwhile, hearing implant maker Cochlear Limited (COH), which yesterday reported a swing to profit from $20 million loss, fell another 4pct to $70 following a broker downgrade.

In the retail space, discount retailer JB Hi-Fi (JBH) rose 5.1pct to $10.75 on a broker upgrade. Retail stocks in general fared well despite a report showing retail spending was down 0.2pct in December. Shares in David Jones (DJS) rose 3.7pct to $2.54 while Myer (MYR) was up 1.6pct to $2.54.

The retail data released today showed retail spending fell by 0.2pct in December, marking the third consecutive monthly fall. Non-food retailing rose by just 0.9pct over the year - the weakest annual growth in 1½-years.

Retail sales at larger chain stores fell by 0.3pct in December to be up 4.4pct on the year.

Over the December quarter, retail trade rose by 0.1pct in real (inflation-adjusted) terms to be up 2.6pct over the year.

Department store sales were up 1.9pct in 2012 - the best growth in four years.

In other economic news today, the number of tourists arriving in Australia rose by 1.6pct in December to record highs. Tourist departures rose by 0.1pct in the month with 8.2 million Aussies travelling overseas in 2012 - the highest result on record.

In December 56,000 tourists from China came to Australia, up 17.2pct on a year ago. China has continued to extend its dominance as the second largest source of tourist arrivals with a record 643,800 Chinese tourists visiting Australia over 2012.

The Australian dollar dipped today to end the session at US103.53c, £0.6611 and €76.29c.

On the market overall, a total of 2.17 billion shares were traded, worth $4.8 billion. 549 were up, 417 were down and 342 were unchanged.

At 4.45pm AEDT the SFE 200 Futures Index was at 4883, up 39pts.

No economic data is scheduled for release in the US tonight.

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