Australian Stock Market Report – Afternoon 7/2/13

AFTERNOON REPORT
(5pm AEST)

Strong turnaround as RBA leaves rates at historic lows.

The Australian share market has made a solid turnaround today, spurred by positive offshore gains and the Reserve Bank of Australia's decision to leave interest rates on hold at 2.75 per cent.

Every sector on our market moved higher, with particular strength from mining and energy players. This was in part due to stronger commodity prices but also the RBA indicating a further depreciation in our dollar could rebalance the economy, thus providing further support to areas like the resources sector.

In company news, pallet provider Brambles (BXB) rose 3 per cent to $9.35 after confirming it will spin off its underperforming business management business Recall.

QBE Insurance (QBE) was up 4.2 per cent to $15.94 after updating investors at a briefing today and confirming its 1H investment yield is expected to come in line with previous guidance of 2.25 per cent. QBE also announced its 1H premium rate has increased in line with expectations at 5 per cent.

Drilling company Boart Longyear (BLY) was among the losers, down another 11.2 per cent after falling yesterday by 7.4 per cent on a profit downgrade. BLY shares closed at 55.5c.

The New News Corp (NNC) also closed down by 4.6 per cent to $15.88. However investors continued to buy into 21st century Fox (FOX) which rose by 3.1 per cent to $32.36 on its first day under the FOX code.

On the market overall, a total of 1.5 billion shares changed hands, worth $4.9 billion. 658 shares were up, 235 were down and 302 were unchanged.

At 5pm AEST the SFE 200 Futures market was at 4789, up 101pts.

Ahead tonight, factory orders and total vehicle sales are released in the US.

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