Australian Stock Market Report - Midday 2/8/2012

LUNCHTIME REPORT
(11.40am AEDT)

The local share market is trading slightly higher in the early session, on the back of modest gains on Wall Street overnight. At lunchtime in the East, the All Ordinaries Index (XAO) has added 7.6pts or 0.2pct to 4352.5.

Financial and energy sectors are higher, while the property trust sector is firmer by 0.8pct.

Index leader BHP Billiton (BHP) has today reported its first half 2012 result, which came in slightly below market consensus. Australia's largest miner and biggest listed company reported a 7.1pct drop in 1H profit due to lower commodity prices and higher costs. Profit came in at US$9.94 billion, and despite being one of the largest results in Australia's corporate history, it's the first decline in profits BHP Billiton has recorded in three years. Shareholders will receive an interim dividend of US55c per share. BHP shares are down 0.8pct in early trade to $37.61 while Rio Tinto (RIO) shares have fallen 0.9pct to $70.34.

Elsewhere, shares in Tasmanian hardwood forest products company Gunns (GNS) have shot up 56pct to 19.5c after the company confirmed it's attempting to raise $280 million through a capital raising. $150 million will come from billionaire Richard Chandler, in an effort to spark the development of the stalled $2.3 billion Bell Bay pulp mill.

The Australian dollar remains well supported and is currently at a six month high against the greenback at US108.01c. It's also buying £0.6792 and €81.45c

Juliette Saly, CommSec Market Analyst

[Kick off your trading day with our newsletter]