Australian Stock Market Report – Midday 10/25/2012

MIDDAY REPORT
(12.30pm AEDT)

Overseas markets generally stabilised overnight following the sharp sell-off yesterday. European markets were higher even with weak manufacturing numbers and lower metals prices. The US markets lost ground towards the close of trade the Dow finishing down 25 points and the NASDAQ only down 8points but still in the red.

Today Aussie market started the day unchanged as strong bargain hunting offset the falls in commodity driven stocks.

AGM season and company results once again dominated on the morning session. By lunchtime today the All Ordinaries Index (XAO) was up 5pts to 4,535 points.

The Banking & property sectors had started off well as many investors ran to the safety of property trusts and insurance stocks today. 3 of the big 4 banks were slightly higher with Commonwealth Bank of Australia (CBA) slightly higher up $0.11 to $57.19. Australia and New Zealand Banking Group Limited (ANZ) off 0.9% to $25.36 after reporting its full year result today. ANZ FY listed a record Underlying Profit $6.01Billion up 6% year on year (Just below Market expectation. ANZ also noted that its margins listed a small decline and deposits were higher. CEO Mr Mike Smith also said "The bank´s provisions for bad debt costs could increase as slowing economic growth slows in the year ahead." $0.79c •

Wesfarmers (WES) reported its quarterly production and retail numbers today. Coal production was off 6.5% over the last quarter as the mining firm was hit by high overburden removal up 28.7%. Overburden is the removal of not coal bearing ore & soil but once removed the speed of extraction and therefore production values usually improve. Wesfarmers first quarter retail sales came in higher than expected with strong numbers from Coles up 4.2%, Office works up 0.3% (help by stronger online sales) and Bunnings. Target numbers were also up 2.2% showing the Target turnaround story and new management plans are working for the group and Kmart up 3.1%. WES up 0.6% to $34.82 while rival in the food and beverage space Woolworths Limited (WOW) up 0.29% to $29.19.

Diversified property group Mirvac (MGR) today released its quarterly numbers the company affirmed its Full Year guidance and said that it expects office market rent growth to remain flat. On the housing front MGR has seen and expect to continue to see fundamentals improvements in NSW & WA while QLD and VIC are weaker. MGR up 2% to $1.55.

Whitehaven Coal (WHC) shares were placed in a trading halt yesterday at $3.20 after the company moved to respond to demands from its largest shareholder, mining magnate Nathan Tinkler. Today WHC was given approval by the New South Wales planning commission for its Maules Creek coal project in the north-west NSW. WHC said it will update the market on Friday with more news.

The gold price was slightly lower at US$1,701 an ounce, the oil price off another US$1.30 to US$85.36 a barrel, while the Iron ore price was higher, up US$1.20 a dry tonne to US$118.70.

At lunch the Aussie dollar could buy you 103.66 USC and 0.7986 Euro.

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