Australian Stock Market Report – Afternoon 6/27/13

MARKET CLOSE REPORT

(4.30pm AEST)

After a tough start to June, investors are a little more upbeat heading into the end of the financial year. Today marked the second consecutive session of 1.6 per cent gains, with the Australian dollar also rising over the past 24 hours. Investors and traders weren't interested in Australian politics today and took their lead from offshore.

One of the drivers of our market was a solid rise in US stocks overnight. A weaker than forecast growth rate of 1.8 per cent (previously 2.4 per cent), together with slower than anticipated consumer spending managed to keep investors upbeat. This is a strange situation where lacklustre results have eased the chatter about the imminent stimulus slowdown by the Federal Reserve (US central bank).

We're only a day away from the end of the financial year, and that's always a trigger to reach for my calculator and remember the good days in year three maths class. Despite the recent moves, both the US and Australian markets are up around 15.7 per cent over the past 12 months.

Around the region, the Japanese sharemarket has been the standout, rising by 46 per cent over a 12 month period. Japanese shares have been boosted by huge stimulus measures and a weaker Japanese yen. Shares in China has slumped by 11.5 per cent this financial year, Hong Kong's Hang Seng is up 6 per cent while South Korea's KOSPI is largely unchanged. In Europe, Germany's DAX has been an outperformer, jumping by 23 per cent, France's CAC40 is 16.5 per cent higher and the UK's FTSE has gained by 8.5 per cent.

Today, the big four banks contributed to about a third of the gains, with three of the majors rising by over 3 per cent. The miners were boosted by big improvements from gold producer Newcrest Mining (NCM), which recorded a 6.3 per cent rise and Fortescue Metals (FMG) gained by 2.3 per cent. NCM is still down by 55 per cent this calendar year.

At the close, 1.83 billion shares have changed hands, worth $5.42 billion. 611 stocks ended higher, 382 in the red and 377 were unchanged.

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