Australian Stock Market Report – Midday 6/19/13

MID-SESSION REPORT

(12.30pm AEST)

Australian shares are trading close to the highest levels of the day, with the All Ordinaries Index (XAO) up 0.5 per cent. There still is significant hesitation ahead of the Federal Reserve's statement on monetary policy due at 4am (AEST) tomorrow morning. Investors are hoping for further clarification on the US central bank's plans on stimulus in the future.

Last night, US markets rose by 0.9 per cent while European stocks had a largely uneventful session.

Media giant News Corp (NWS) is in the process of splitting into two separate entities. NWS, which is down 8.4 per cent at lunch, will change its name to FOX on 2 July. The other company is trading as New News Corp (NNC). It opened at $15.00, hit a high of $15.35 and a low of $14.85 today. NNC is currently at $14.95. Eligible shareholders will receive one NNC share for every four NWS held.

NSW based coal producer, Whitehaven Coal (WHC) is up 4.2 per cent after US investment fund, Farallon acquired a 9.91 per cent stake in WHC. Farallon believes WHC's closing price of $2.11 (yesterday) doesn't reflect the true value of the business. WHC shares are down 37 per cent this year, adding to 2012's 27 per cent tumble.

Australia's largest insurance company, QBE Insurance (QBE) is one of today's better performers, up 2.2 per cent. QBE tends to benefit from a stronger USD and a weaker Aussie. The insurer's share price jumped by 19 per cent in May, while the Australian dollar fell by US8c against the greenback over the month.

The mining sector is leading the gains, with both Rio Tinto (RIO) and BHP Billiton (BHP) up around 1 per cent at lunch. Resource stocks are down 16.2 per cent this calendar year. The major banks are significantly lower after 2.5 hours of trade.

Earlier today, Japan recorded its 26th straight monthly trade deficit. Despite the recent falls in the Nikkei, Japanese equities have appreciated by 25 per cent since January, while the Australian market is up by only 3.2 per cent.

At lunch, 584.3 million stocks have changed hands, worth $1.74 billion. 464 stocks are higher, 326 are in the red while 331 are unchanged.

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