Australian Stock Market Report – Afternoon 7/12/13

EVENING REPORT
(4.30pm AEST)

Local shares failed to hold onto the 0.9 per cent improvement recorded over the first hour of trade. However, the All Ordinaries Index (XAO) still managed to edge higher by 0.3 per cent; gaining for the fourth straight day; up around 2.9 per cent this week and flirting with the 5000.0 point mark for the first time since May.

The past five days have been dominated by the US central bank and expectations that the Fed will not be raising rates for some time to come. This has resulted in the strengthening of the Australian dollar, a fall in bond yields and a rise in US equities.

Locally, consumer confidence fell slightly in July, business confidence remains unimpressive while 80 per cent of the job gains this year continue to be part-time positions. Across the region, Chinese trade numbers disappointed while inflation remains a non-concern for Chinese authorities.

Earlier today, all sectors were tracking higher however a large portion of the gains dissipated in the second half of trade. The energy, property and financial sectors eased modestly by close. The price of oil has shot higher by 9 per cent so far this month, which has given energy stocks something positive to work with. Overnight however; the price of oil (Nymex WTI) slumped by 1.5 per cent, which pushed many of the oil and gas producers into the red.

The major banks all slipped by as much as 1.3 per cent, with Westpac (WBC) the worst performer. The financial sector has still improved by 2.2 per cent this week. Over the past five days, energy stocks have gained 3.7 per cent, materials 4.8 per cent, industrials up 3.1 per cent, while healthcare stocks gained 2.6 per cent.

By the close, 1.5 billion shares changed hands, worth $4.28 billion. 524 stocks were higher, 345 finished in the red while 339 ended flat.

Tonight, industrial production will be out at 7pm (AEST) in Europe. In the US, business inflation for June will be out, together with consumer confidence and preliminary consumer inflation expectations. FOMC member Bullard will be speaking at 3am (AEST)

Next week will be much quieter locally, with the Reserve Bank board minutes the economic highlight.

[Kick off your trading day with our newsletter]