Australian Stock Market Report

MIDDAY REPORT
(12.30pm AEDT)

The Australian sharemarket has kicked off the week in the red with the All Ordinaries index (XAO) down 1 pct or 41.3 pts to 4214.1. Almost all sectors are losing ground however the miners are the worst performers, down around 1.3 pct.

The local market's largest company, BHP Billiton (BHP) is down 1.28 pct or 47 cents to $36.13. The smaller, RIO Tinto (RIO) is down 0.81 pct or 53 cents to $64.68. Commodity prices ended lower on Friday night however Woodside Petroleum (WPL) is managing to record some modest gains at lunch, up 0.52 pct or 17 cents to $33.02.

One of the country's largest insurers, QBE Insurance (QBE) has struggled this month and fell by 16 pct last week after telling the market that profit last year will be as much as 50 pct lower than in 2010. This is partly due to the natural disasters. On a positive note however, QBE is up 2.36 pct or 26 cents to $11.27 in what is shaping up to be a much more start to the trading week.

The financial sector is also struggling, with the big four banks all down by as much as 2.1 pct. ANZ Banking Group (ANZ) is the worst of the majors, down 2.08 pct or 44 cents to $20.76, Westpac (WBC) is 1.74 pct or 36 cents lower to $20.32, National Australia Bank (NAB) is down 1.68 pct or 40 cents weaker to $23.41 and Commonwealth Bank of Australia (CBA) is down 1.08 pct or 54 cents to $49.53.

Unfortunately, the retailers are not escaping the losses either, with department store owner David Jones (DJS) down 0.84 pct or 2 cents to $2.35 while its competitor Myer (MYR) is 1.93 pct or 4 cents weaker to $2.03.

On the economic front today, the latest monthly inflation gauge, housing finance and job advertisement numbers are out today. The December inflation reading rose by 0.5 pct. Prices for residential homes and for travel gave the numbers the most significant boost. Prices also rose for accommodation, alcohol and tobacco products.

Following the start of daylight savings at the start of October, major Asian markets will be trading between the hours mentioned below until April next year (note that over the next month, some of the times might be slightly off due to several countries in the region changing their clocks at differing periods).

The Hong Kong sharemarket trades in two sessions each day and will now open for trade between 1pm (AEDT) and 3.30pm (AEDT) while the second session is between 5.30pm (AEDT) and 7pm (AEDT).

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

The Singapore exchange will be open for trade between 12pm (AEDT) and 3.30pm (AEDT) for the first session and then between 5pm (AEDT) and 8pm (AEDT) for the second.

All major Asian markets that are open for trade so far today are trading in the red, with Japan's Nikkei 225 index down 1.39 pct or 118.5 pts to 8381.52, South Korea's KOSPI index is down 1.07 pct or 20.03 pts to 1855.65 while shares in the Philippines are 0.74 pct or 34.28 pts weaker to 4613.83.

In the region, the latest household confidence report will be released in Japan this afternoon. The market is expecting a slight improvement in confidence levels.

So far in trade at lunch, 555 million shares have been traded worth $1.11 billion. 279 shares are up, 484 are lower and 277 are currently unchanged.

The Australian dollar (AUD) is weaker against the greenback and buys US102.6 cents.

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.

Steven Daghlian, CommSec Market Analyst

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