Australian Stock Market Report – Afternoon June 12, 2014

Evening Report
(17:00 AEST)

The ASX 200 ended lower for a second day on Thursday with sellers showing preference for the materials sectors, although most sectors ended in the red. The only sector to resist the efforts of sellers was the healthcare index which ended with a gain of 0.1%. Value today was solid with $4.3bln in shares changing hands.

Qantas released a statement highlighting that it had paid down $450 million in debt, eight months earlier than required. The flying Kangaroo has $281 million in debt to be repaid during the 2015/16 year in addition to $550 million in the following year. Late last year the airline had its credit rating downgraded to junk status, increasing the cost of borrowing. Qantas said it currently holds $3 billion in cash and undrawn bank funding. The shares ended down by 2.8 per cent for the session

The Healthcare sector was supported by 3.6% increase in Ramsay Healthcare (RHC). The hospital operator announced yesterday along with its European partner it had secured control of French hospital group Generale de Sante which operates 75 health facilities in France, including 61 hospitals. The addition will lift Ramsay´s number of health facilities in France to 115, including 101 hospitals, making it the largest the largest private hospital operator in France. The company and financial services provider Credit Agricole Assurances have acquired 83.43 per cent of Generale de Sante, with Ramsay´s 57 per cent share of the acquired stake to cost it about $627 million

Jobs data for May was softer than expected at a headline level, but full-time employment rose once again. Employment fell by 4,800 in May, having risen by a revised 10,300 in April which was previously reported as a 14,200 increase in jobs. Full-time jobs rose by 22,200 in May after rising by 13,800 in April. Part-time jobs fell by 27,000 in May after falling by 3,600 in April. In the bigger picture, a total of 101,200 new full-time jobs have been created in the first five months of 2014 which marks the best start to a calendar year in seven years. The take out from the numbers is that there are positive signs in the jobs market, although there is nothing to suggest the RBA will change its thinking on interest rates.

US retail sales and weekly jobless data are the features of the economic calender in overseas trade tonight. The ECB releases its Monthly Report in Europe.

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