Australian Stock Market Report – Afternoon July 4, 2014

IN PHOTO: The Goldman Sachs logo is displayed on a post above the floor of the New York Stock Exchange Reuters/Stringer

EVENING REPORT
(4.30pm AEST)

The local sharemarket has just had its best week in four and a half months, with the All Ordinaries index (XAO) rising by approximately 1.5 per cent over the past five days. Better than expected employment growth in the U.S. gave local investors an additional push forward today.

Looking back at the different sectors locally, the miners were by far the best performers this week, with gains of 3.07 per cent in just five days. Firmer commodity prices, with gains of more than 1 per cent for iron ore certainly helped. Consumer discretionary stocks jumped by 2.77 per cent, consumer staples rose by 2.06 per cent and the telcos were also outperformers after gaining 1.43 per cent.

Australia's second largest oil and gas producer Woodside Petroleum (WPL) rose by 0.5 per cent and announced its plan to purchase a 25 per cent interest in exploration permits off the coast of Morocco.

The retailers finished mostly softer, with discount retailer JB Hi-Fi (JBH) falling by 1.1 per cent. Billabong (BBG) fell by 2 per cent while department store owner Myer managed to surge by 1.86 per cent.

By the close, 2.08 billion shares changed hands worth $4.11 billion. 615 stocks were higher, 396 ended in the red and 329 closed unchanged.

The start of a new month and quarter is always a busy time for markets. On Thursday a report showed a pullback in retail spending for the second month, the Reserve Bank Governor talked down the strength of the Australian dollar, while building approvals surged by 9.9 per cent in May. On Wednesday Australia recorded a bigger than expected trade deficit and on Tuesday the Reserve Bank kept interest rates at historic lows for the 12th month.

Looking ahead tonight should be quiet due to the Independence Day holiday in the U.S. No major data is scheduled for release.

Next week, the latest update on the state of Australia's labour market will be the highlight on Thursday. The market is expecting the creation of around 12,000 jobs in June. The Reserve Bank will be watching the result quite closely.