Australian Stock Market Report – Midday 4/26/2012

LUNCHTIME REPORT
(12.15pm AEST)

On Tuesday, afternoon before the Anzac Day public holiday, The Australian share market rose 3.6 points to 4,433 points.

The Australian share market jumped on the back of the solid leads from the overseas markets over the last 2 days. US and European markets higher overnight, helped by positive earnings result from key European banks and consumer product companies and outstanding numbers from Apple and Boeing in the US.

The local share market started the trading day on higher, up 22 points. At lunchtime in the East markets had held on to early gains with the All Ordinaries Index (XAO) rallied 21 points to 4,455 points.

Rail transport firm, QR National Limited (QRN) and miner Atlas Iron Limited (AGO) updated the market on their new Pilbara rail line project. Atlas and QR National have been working on a possible 600 kilometre ore haulage rail line. Speculation has been mounting for the last few weeks since it was made public that QRN had applied for approval to use land from the Western Australian Department of Mines for the project.

Atlas and QRN today said the rail line would be ready by 2015 and with a study of the project expected to be completed by 2012. Atlas will be a "junior equity partner" and foundation customer on the project enabling the miner to haul its own ore on the new tracks. For QR National it helps the company build its Pilbara iron ore haulage portfolio. QRN shares added 1.38 pct. to $3.68 and Atlas added 1.75 pct. to $2.90. QRN's rail rival, Asciano Limited (AIO) unchanged at $4.67 and Toll Holdings Limited (TOL) higher by 2.07 pct.

By lunch the S&P/ASX 200 Consumer Discretionary was the only sector to be in the red. The majority of the falls were in media stocks after Seven West Media Limited (SWM) announced downgrade it its earnings late on Tuesday, after revising its expectation on advertising revenues. The company said that the expected return in the ad market has not so far occurred. Seven west shares fell to a 5 month low in early trade, at lunch time the shares were down 16 pct. to $3.16. Rivals; Ten Network Holdings Limited's (TEN) share prices fell over 0.64 pct. to $0.81, Fairfax Media Limited (FXJ) off 3.13 pct. Southern Cross Media Group Limited (SXL) off 4.38 pct to $1.31 and Consolidated Media Holdings Limited (CMJ) had fallen by 0.92 pct.

Seven Group Holdings (SVW) still owns 29.6 pct. of Seven West Media Limited (SWM) after is demerger earlier in April 2011. Seven Group shares fell 1.5 pct. to $10.24.

Retail and mining giant, Wesfarmers (WES), the owner of Kmart, Target, Bunnings and Coles added another 0.69 pct. or 20 cents to $30.08 after releasing its quarterly sales update to the market on Tuesday, rival Woolworths (WOW) gave back 0.08 pct to $ 25.83 and Metcash Limited MTS) added 0.76 pct. to $3.99.

S&P/ASX 200 Materials sector is up 0.22 pct. The country's second largest miner, Rio Tinto Limited, (RIO) was up 0.9pct to $66.21 and BHP Billiton Limited (BHP) adding 0.26pct. to $35.17.
Our largest listed gold miner Newcrest Mining Limited (NCM) fell another 2.7 pct. to $25.86. On Tuesday the gold miner has cut its forecasts for gold and copper production for 2012 after carrying out a major review of its operations. Kingsgate Consolidated Limited (KCN) was lower off 2.4 pct. to $6.10. Not all gold stocks were lower Silver Lake Resources Limited (SLR) lifted 2.6pct. to $3.12 and AngloGold Ashanti Limited (AGO) up 1.5 pct.

The S&P/ASX 200 Financials sector is outperforming the rest of the market, National Australia Bank's (NAB) share price is up 0.68 pct to $25.34 and Australia and New Zealand Banking Group Limited (ANZ) also up 1.12 pct to $23.45 while Commonwealth Bank of Australia (CBA).

Macquarie Group (MQG) was up 1.3 pct. to $29.98 and QBE Insurance Group Limited (QBE) holding on to a 1.9 pct. gain at $13.92.

Elsewhere, Qantas Airways Limited (QAN) off 0.91 pct. to $1.63, Leighton Holdings Limited (LEI) lifted 2.3 pct and drilling service firm, Boart Longyear Limited (BLY) moved up 2.96 pct. to $4.17.
Telstra Corporation Limited (TLS) added up 1 pct. to $3.15.

The Australian dollar rallied higher in morning trade and at 12.15pm AEST was buying US103.58c and €78.35c.

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