Australian Stock Market Report – Midday 6/27/13

MID-SESSION REPORT

(12.30pm AEST)

Australian stocks are enjoying a second session of gains, but it's not the events which transpired in Canberra overnight driving sentiment higher, rather the calm that has been brought to markets by the China Central Bank and a strong rally on Wall Street overnight.

This morning former Prime Minister Kevin Rudd was reinstated as Federal ALP Leader and Prime Minister, after winning a leadership vote against Julia Gillard 57 votes to 45.

Local stocks are up by 1.4 per cent at lunchtime in the East.

One aspect of the ALP Leadership change which is supporting the market is a pick-up in consumer discretionary stocks. Speculation the election could be brought forward has sent buyers into retail stocks, as once who will govern the country is resolved, consumers are likely to start spending more. Shares in Myer (MYR) are up 6.2 per cent while David Jones (DJS) is firmer by 3.8 per cent and Harvey Norman (HVN) is up 4.8 per cent.

Big mining players are under pressure in the early session in response to a fall in base metals prices. BHP Billiton (BHP) is down 1 per cent while Rio Tinto (RIO) is off 1 per cent.

Despite a big drop in the gold price overnight, Australia's largest listed gold player Newcrest Mining (NCM) shares are firmer by 7.4 per cent to $10. The gold price has risen by 1 per cent in Asian trade to US$1241 an ounce.

So far on the market, a total of 855 million shares have changed hands, worth $2.1 billion. 509 are up, 293 are down and 337 are unchanged.

The Australian dollar is back above US93c. It is also buying £0.6082 and €71.58c.

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