Australian Stock Market Report - Midday 12/15/2011

MIDDAY REPORT (12pm AEDT)

The Australian sharemarket is doing it tough at lunch with the All Ordinaries index (XAO) down 1.3 pct or 55.1 pts to 4194.7. Today's weakness has effectively wiped out almost all of this month's gains.

The mining and energy sectors are the worst performers with mining giant RIO Tinto (RIO) down 2.58 pct or $1.63 to $61.53 while the larger BHP Billiton (BHP) is 2.02 pct or 72 cents weaker to $34.99. RIO is currently trading at its lowest level in around two months while BHP is at its low point for the month.

The four major banks are also dragging the market deeper into the red with Westpac (WBC) down 1.68 pct or 35 cents to $20.45, National Australia Bank (NAB) is off 1.61 pct or 38.5 cents to $23.47, Commonwealth Bank of Australia (CBA) is down 1.48 pct or 72 cents to $48.66 and ANZ Banking Group (ANZ) is 1.19 pct or 25 cents weaker to $20.72.

NAB is holding its Annual General Meeting (AGM) with shareholders today. The major bank has indicated that the uncertainty in Europe is pushing up funding costs and that 2012 is expected to be a challenging year.

On the economic front, a report has shown that Australians are still shying away from purchasing big ticket items. The number of new cars sold last month fell by 0.7 pct.

Both China and Japan are both releasing an update on the state of their manufacturing sectors today.

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.

Asian markets are mostly lower at lunch with Japan's Nikkei 225 index down 1.04 pct or 88.96 pts to 8430.17 while South Korea's KOSPI is down 1.28 pct or 23.79 pts to 1833.96.

So far in trade at lunch, 1.17 million shares have been traded worth $3.42 billion. 216 shares are up, 578 are lower and 293 are currently unchanged. Today is expiry day for index futures which tends to result in increased volume throughout the day.

The Australian dollar (AUD) is weaker and buys US99 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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