MIDDAY REPORT (12pm AEDT)

At lunch time, The Australian share market is climbing higher, with the All Ordinaries index (XAO) up 20 points to 4,299. Most sectors are holding up ok, the miners strong after higher commodity prices over night and banks getting a buzz from strong results from key financial firms in the U.S. overnight. However the S&P/ASX 200 Consumer Staples sector is off around 0.2 pct, with major food and liquor retailers losing ground.

After a strong session on European and U.S. markets we received some great results from global technology operators like; IBM, Microsoft and Intel, while Google's result disappointed the market. The strong results have boosted technology stocks in the Asian region, with gains on the Nikkei market in Japan and KOSPI in South Korea. And the Australian S&P/ASX 200 Information Technology sector is also higher today even though the stock results would not have had a big impact on the style of stocks listed on our own market. Trading and stock market related companies are leading the sector higher today with Computershare Limited (CPU) up 1.53 pct or $0.012 to $7.94 and IRESS Market Technology Limited (IRE) up over 1.5 pct.

Later today the all important HSBC Flash China Manufacturing PMI for January. This is an initial read on manufacturing but it is an important piece of the puzzle about Chinese growth and factory orders. The Flash manufacturing result will be of great importance to the direction of metal prices tonight on the London Metals Exchange (LME) tonight and mining stock prices in the last half of our trading day.

Currently the S&P/ASX 200 Materials index is up 0.63pct. The world's largest miner, BHP Billiton (BHP) is up 0.43 pct or $0.16 cents to $37.50, still riding high after its bumper production report earlier in the week. RIO Tinto (RIO) shares are up 0.72 pct or $0.48 cents to $67.23. Iron ore miner, Fortescue Metals (FMG) up another 1 pct. Newcrest Mining Limited (NCM) our largest listed gold miner off 0.67 pct to $32.48.

Australia's second largest oil and gas producer, Woodside Petroleum (WPL) continuing to move higher after yesterday upgrading its full year production target, WPL shares up 1.49 pct or $0.48 cents to $33.96. Santos (STO) up 1.06 pct to $0.14 to $13.39.

The retail sector is under pressure our two largest food and drink retailers, Wesfarmers Limited (WES) off 0.49 pct to $30.23 and Woolworths Limited (WOW) off 0.76 pct or $0.20 cents to $24.93. Our leading department stores are mixed with Myers limited (MYR) up 0.50 pct but David Jones Limited (DJS) off 0.25 pct.

Our four major banks started off strong but are already losing momentum, with National Australia Bank (NAB) only up $0.02 cents to $23.90, Westpac (WBC) is 0.06 pct or 40.13 cents higher to $20.73, ANZ Banking Group (ANZ) 0.43 pct stronger to $20.91 and Commonwealth Bank (CBA) is higher by $0.13 cents to $49.93.

On the economic front, the latest Commonwealth Bank Business Sales Indicator (BSI) for December was released this morning showing positive signs for the new year. Businesses concluded 2011 on a positive note as consumers continued to spend in December, albeit cautiously, according to Business Sales Indicator increases by 0.2 per cent in trend terms

The Australian dollar (AUD) is buying US104.14 cents, €80.36 cents and £67.25 pence.