Australian Stock Market Report – Afternoon 4/2/14

EVENING REPORT
(4.30pm AEDT)

Despite ending a little short of intra-day highs, the All Ordinaries Index (XAO) managed to spike late in trade to end 0.26 per cent or 13.6 pts firmer to 5408.8. Property trusts, the utilities and IT businesses were the biggest losers, while all remaining sectors edged a little higher. Global markets were firmer overnight, with the tech specific NASDAQ and the S&P500 the standouts. The S&P500 broke through yet another record high thanks partly to healthy economic news. The index has surged by 8 per cent over the past two months. So far this calendar year the Australian market has done very little, with the All Ordinaries Index gaining just 0.93 per cent between January and March 2014.

QBE Insurance (QBE) held its Annual General Meeting today. The insurer took the opportunity to highlight that it faced a 'perfect storm' of challenges last year, particularly in the U.S. On a positive note, QBE does expect conditions over 2014 to be more stable. QBE shares finished 0.47 per cent firmer, taking the gains this year to 11.21 per cent.

Clothing retailer Noni-B (NBL) finished above the lows of the day; however still slumped by a hefty 10.91 per cent following a slide in quarterly sales. Sales between January and March fell by 14 per cent; with revenue adversely impacted by a reduction in significant sales/discounts. The idea was to boost margins; however has failed to attract enough traffic through the doors.

BHP Billiton (BHP) finished 0.86 per cent higher and up 3.4 per cent this week; however is still 1.63 per cent weaker so far this calendar year. Market speculation yesterday that the mining giant could be considering a hefty $20 billion demerger to allow greater focus on its core assets, has been a catalyst for the gains. This has not been confirmed by the miner. BHP generates the lion's share of its income from the production of iron ore, copper, petroleum products and coking coal.

On the economic front, building approval numbers slumped by 5 per cent in February while the number of job vacancies across Australia rose by 2.6 per cent in the three months to February. CommSec's chief economist Craig James said that "...in trend terms, approvals to build new homes are at record highs. Work on these new homes will get underway in the next few months, adding to an already full work schedule for builders. Clearly there is a building boom underway."

The Australian dollar is softer than at the start of the week, buying US92.3c.

1.69 billion shares changed hands today, worth $4.5 billion. 471 stocks finished higher, 448 ended in the red and 372 ended flat.

Looking ahead, euro zone finance ministers are meeting, quarterly GDP numbers will be issued at 8pm (AEDT) and private sector employment data is scheduled for release in the U.S.