Australian Stock Market Report – Midday 4/27/2012

MIDDAY REPORT
(12pm AEST)

Despite positive moves on US and European markets overnight, the Australian share market is showing no great signs of momentum at lunchtime in the East. Profit downgrades and a fall in earnings from Macquarie Group (MQG) has weighed on investor sentiment, with the All Ordinaries Index (XAO) flat at 4444.1.

Macquarie Group today announced a 24.6pct fall in full year earnings to $730 million, which met market expectations. MQG continues to reduce headcount amid subdued activity in global markets and has reaffirmed its commitment to buy back around 10pct of its shares. MQG is trading higher by 2.5pct to $29.15 at lunchtime, outperforming the overall financial sector which is flat.

Elsewhere today, discount retailer JB Hi Fi (JBH) says its policy of heavy discounting has hurt its bottom line. JBH now expects full year profit to dip by almost 9pct to $100-105 million. JBH shares are down 5pct in early trade to $10.17 while Harvey Norman (HVN) is off 3pct to $2.005.

No economic data is being released locally today and the Australian dollar has received a boost thanks to the rise in US equity markets overnight. At 12pm AEST the Aussie is worth US103.77c, £0.6412 and €78.6c.

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