Australian Stock Market Report – Midday 12/21/2012

MID-SESSION REPORT
(12pm AEDT)

The Australian sharemarket continues its formidable run, with the All Ordinaries Index (XAO) up by 0.4 per cent or 19.2 pts to 4665.8. This makes it the Aussie market's fourth consecutive session of gains. Volume has been heavy over the past few days due to equity and index options expiry yesterday. Today marks the end of the final full week of trade for 2012. The market will be closing early on Monday and will not trade next Tuesday or Wednesday.

Global markets ended mostly higher overnight, with the American economy growing at a faster than expected 3.1 per cent between July and September. The number of Americans filing to receive unemployment benefits rose a bit more than forecast last week. The Dow gained by 0.5 per cent while the DAX and CAC40 in Europe edged a touch higher.

The price of gold fell for the third straight session, however the value of gold has increased for 12 consecutive years. It has risen in value by an average of 19.5 per cent each year over the past decade. The Aussie market in comparison has only improved by 6 per cent (on average) per year since 2002. This has been largely due to the Global Financial Crisis (GFC) since 2008. A $10,000 investment in gold back in 2001 would now be worth around $60,000.

The energy sector is edging higher by 0.7 per cent and is one of the better performing industries at lunch. Santos (STO) is up 2.33 per cent or 25 cents to $10.97 while Woodside Petroleum (WPL) is 1.25 per cent or 41 cents to $33.92.

BHP Billiton (BHP) is down 0.13 per cent or 5 cents to $37.00 while the smaller Rio Tinto (RIO) is up 0.11 per cent or 7 cents to $65.37.

The major banks are all improving, while Commonwealth Bank of Australia (CBA) has managed to crack through the $100 billion market capitalisation mark for the first time. CBA is up 0.96 per cent or 59 cents to $62.12 while the other banks are up by as much as 1.3 per cent.

Following the start of daylight savings in October, major markets in the region will be trading between the hours mentioned below until April 2013.

The Hong Kong sharemarket trades in two sessions each day and will now open for trade between 12.30pm (AEDT) and 3pm (AEDT) while the second session is between 4pm (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 and 3.30pm (AEDT) for the first session and then between 5pm and 8pm (AEDT) 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, 1.009 billion shares have been traded worth a substantial $4.6 billion. 372 shares are up, 372 are lower and 319 are currently unchanged.

The Australian dollar (AUD) is weaker and buys US104.5 cents, €79.1 cents and £64.3 pence. The AUD is still relatively close to trading at its strongest levels against the greenback since September.

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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