Australian Stock Market Report – Midday 4-3-13

MID-SESSION REPORT
(12pm AEDT)

Despite a slightly stronger start to the session for the 2nd day running (something which hasn't happened in 4 weeks), the All Ordinaries Index (XAO) is 0.2 per cent or 8.6 pts lower to 4986.9. Shares slumped by 2.7 per cent in March, making it the worst month of trade since May 2012.

Commodity prices were mostly lower overnight which is having an adverse effect on the mining and energy sectors. Gold producer Newcrest Mining (NCM) is down 2.8 per cent, taking the losses for 2013 to 11.5 per cent. Oil and gas producer Santos (STO) is underperforming after ratings agency Standard & Poor's now considers one of its financial instruments as debt rather than equity. STO shares are down 2.1 per cent after two hours of trade.

A report has shown that the number of newly built properties sold in February has fallen for the first time in five months. Sales dropped by 5.3 per cent, with apartment sales (quite a volatile reading) slumping by 11 per cent.

As expected by the market, Australia recorded its 14th consecutive trade deficit (imports greater than exports). On a positive note, a smaller than forecast deficit of just $178M was recorded in February which has assisted the strength of the Australian dollar. One Aussie now buys US104.6 cents.

Global markets performed strongly last night, boosted partly by U.S factories receiving their biggest monthly increase in orders since November 2012. Investors interpreted this as a good sign for the American economy.

European equities (shares) reached their best levels in two weeks, after returning to trade after a four day long weekend. The jobless rate in the Eurozone (the 17 nations currently using the Euro) is now at 12 per cent, which was in-line with expectations. Europe's unemployment reading has worsened by 5 per cent since April 2008 and is 6.6 per cent higher than Australia's jobless rate.

At lunch, 690.5M shares were traded worth $1.67B. 306 stocks are improving, 469 are in the red while 321 are unchanged.

[Kick off your trading day with our newsletter]