Australian Stock Market Report – Midday 11/14/2012

MID-SESSION REPORT
(12pm AEDT)

The Australian sharemarket started the day in mixed fashion; however is currently improving thanks in part to some solid economic numbers. The All Ordinaries Index (XAO) is up 0.1 per cent or 5.1 pts to 4409.3. The energy, mining and industrial sectors are trading in the red while other sectors are higher. This is the first time in five sessions the local market is improving.

The latest Wage Price Index (WPI) rose 0.7 per cent in the September quarter (July to September). This was largely in-line with market expectations and doesn't change the outlook for potential rate cuts over the next few months. The market is still factoring in around a 60 per cent likelihood of a rate cut while CommSec considers a February move as a more probably prospect.

A report has shown that Australians are 5.2 per cent more confident about the state of their financed and the economy now than they were a month ago. A reading of 104.3 indicates modest optimism (any number above 100.0 is a positive). These numbers are based on a survey of 1,200 Australian consumers. A firmer sharemarket and the recent drop in petrol prices perhaps have boosted confidence. Despite this being a good sign for retailers leading up to Christmas, the improvements would need to be sustained for a number of months before the retailers feel more comfortable. David Jones (DJS) is up 0.41 per cent or 1 cent to $2.45, Myer (MYR) is down 0.88 per cent or 1.75 cents to $1.97 while JB Hi-Fi (JBH) is 1.19 per cent or 12 cents stronger to $10.22.

QBE Insurance (QBE) has been one of the worst performers this week after warning the market of the costs associated with Superstorm Sandy. A little relief for its shareholders today however; with QBE up 1.47 per cent or 16 cents to $11.08. Keep in mind that the insurer's share price is still down 13 per cent this week.

The big four banks are helping to keep the market positive, with National Australia Bank (NAB) up 1.19 per cent or 27.5 cents to $23.38. ANZ Banking Group (ANZ) is 0.69 per cent or 16.5 cents firmer to $24.21, Commonwealth Bank (CBA) is 0.33 per cent or 19.5 cents higher to $58.89 while Westpac (WBC) is up 0.18 per cent or 4.5 cents to $24.84.

The major miners and energy players are holding the market back at lunch however; with BHP Billiton (BHP) unchanged at $33.75, Newcrest Mining (NCM) down 1.2 per cent or 31 cents to $25.44.

A number of Annual General Meetings (AGMs) are being held today. Online travel services company, Webjet (WEB) today said profit is likely to fall due to a tough travel market in addition to costs linked to marketing and expansion projects. WEB is down 9.2 per cent or 38 cents to $3.75.

Wesfarmers (WES), the owner of Coles, Fortescue Metals (FMG), Dulux and Computershare are also scheduled to hold their meetings today.

Following the start of daylight savings, major Asian markets will be trading between the hours mentioned below until October this year.

The Hong Kong sharemarket trades in two sessions each day and will now open for trade between 11.30am (AEST) and 2pm (AEST) while the second session is between 3.30pm (AEST) and 6pm (AEST).

Out of Japan, the first session will be between 11am (AEST) and 1pm (AEST) while the second session is between 2.30pm (AEST) and 5pm (AEST).

The Singapore exchange will be open for trade between 11am and 2.30pm (AEST) for the first session and then between 4pm and 7pm (AEST) for the second.

U.S futures are currently pointing to a slightly stronger start to trade tonight. The U.S market trades between 1.30am (AEDT) and 8am (AEDT).

So far in trade at lunch, 655 million shares have been traded worth $1.51 billion. 323 shares are up, 441 are lower and 317 are currently unchanged.

The Australian dollar (AUD) is stronger and buys US104.4 cents, €82.1 cents and £65.7 pence.

The AUD is the world's fifth most traded currency behind the U.S dollar, the Euro, Japanese Yen and British Pound. The AUD accounts for around 7 pct of all foreign exchange trades.

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