Australian Stock Market Report – Midday 5-9-13

MID-SESSION REPORT

(12.30pm AEST)

The Australian market has extended its gains following much better than forecast job numbers and an unsurprising inflation report in China. The All Ordinaries Index (XAO) is up 0.2 per cent or 11.7 pts to 5,189.6, making it the third day of improvements this week. There were 50,100 jobs added in April, 34,500 of which were full-time positions. The unemployment rate eased from 5.6 per cent to 5.5 per cent and the participation rate (the percentage of working-age Australians either employed or looking for work) edged higher from a previous 65.2 per cent to 65.3 per cent.

Most sectors are higher at lunch; however ANZ Banking Group (ANZ) is slumping after going ex-dividend today. ANZ is down 3.1 per cent or 98 cents to $30.46. The $0.73 per share dividend is due to be paid to eligible shareholders on 1 July. Stocks typically fall on their ex-dividend days. National Australia Bank (NAB) became the last of the big four to issue profit results today. NAB announced a 3.1 per cent rise in cash profit to $2.915bn; largely in-line with market expectations. A 3 cent per share (cps) rise in its interim dividend was announced to 93 cps. Its Australian and New Zealand units performed strongly while NAB simultaneously lifted its share of the home loan market by 0.5 per cent. It British division remains challenging.

Media giant, News Corp (NWS) is up 3.33 per cent after issuing a US$2.85bn third quarter profit overnight. Its cable division along with licensing fees boosted the result. NWS owns Fox, The Australian, The Daily Telegraph, The Sunday Times (Western Australia) and The Wall Street Journal.

Surfwear retailer Billabong (BBG) has been suspended from official quotation pending an announcement probably relating to its takeover. BBG shares are down 45 per cent since January 2013.

Rio Tinto (RIO), Caltex (CTX), AMP and Santos (STO) are all holding Annual General Meetings with shareholders today.

The latest Chinese inflation reports (consumer and business) did not surprise significantly this morning at 11.30am (AEST). Consumer inflation (CPI) is up 2.4 per cent over the year while business inflation (PPI) has fallen by 2.6 per cent.

At lunch, 925 million shares have exchanged hands, worth $3.57bn. 465 stocks are higher, 313 are in the red while 313 are unchanged.

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