Australian Stock Market Report – Midday 5/15/14

MID-SESSION REPORT
(12.20pm AEST)

The Australian sharemarket is a touch softer at lunch, with the mining and energy sectors helping minimise losses. Weakness in U.S. markets for the first time in six sessions and a pullback from six-year highs in Europe have given us a negative lead locally.

The financials are down 0.1 per cent, while both Commonwealth Bank (CBA) and Westpac (WBC) are a little higher. CBA rose to a record high of $81.30 this morning, following yesterday's $2.2 billion quarterly cash profit. A $5,000 investment in CBA a decade ago would be worth around $13,000 today. Westpac (WBC) is also close to a record high and is up 5.9 per cent this calendar year.

Commodity prices were mostly higher last night, with base metal prices surging (with the exception of nickel). Nickel prices are still up 44 per cent this calendar year however, as concerns about sanctions on Russia have pushed prices higher. BHP Billiton (BHP) is up 0.1 per cent, Rio Tinto (RIO) is down 0.2 per cent and Newcrest (NCM) is flat.

One of Australia's biggest uranium miners, Paladin Energy (PDN) is up 2 per cent as it holds an investor update today. Uranium miners have been struggling since Japan's Fukushima Daiichi nuclear disaster hit in March 2011. PDN is falling for the fifth straight year. A $10,000 investment in PDN in February 2011 would be worth $870 today.

The telcos are weaker, with Telstra (TLS) down 0.28 per cent while Singapore Telecom (SGT) is 0.6 per cent lower. Optus, which is owned by SGT posted a 14.6 per cent increase in annual profit to $835 million. Smarter cost management was a driver of net profit.

The Australian dollar buys US93.6 cents after rising above US94c for the first time in a month yesterday.

Germany, France and Italy are all issuing their quarterly economic growth numbers today at around 6pm (AEST). European CPI (consumer inflation) will also be released tonight. In the U.S. this evening, CPI, industrial production and a speech by Federal Reserve Chair Janet Yellen will all take place.

847.8 million shares have changed hands at lunch, worth $1.6 billion. 367 stocks are higher, 384 are in the red and 340 are unchanged.