Australian Stock Market Report – Midday 7/16/13

Mid-session Report - 12.05pm

US stocks closed higher again, another record high for the Dow Jones and the Broader S&P 500 indices. Good numbers from Citi group helped send not only the US indices but also the UK banking sector overnight. Boeing shares higher after Friday's slump. The US building sector was held back yet again - as investors start to look at the rising 30 year mortgage rates in the states and weight up the chances of a pullback in home lending rates.

This morning the Aussie market started off stronger up a few points and by lunch the gained had been reigned in.
The All Ordinaries Index (XAO) only up by 1point

There have been some connectivity issues this morning trading on the ASX - this is the message that was posted on IRESS at 11am AEST. "We are currently experiencing issues on certain stocks such as AMP & CBA. The issue relates to match price. The ASX is investigating. We are working to resolve this issue but bids and offers are correct. "

The S&P/ASX 200 Materials sector was lower at lunch off 0.3%. Rio Tinto (RIO) second quarter operations review due out around 3pm today. This report is expected to show that production numbers for iron ore will increase slightly in the quarter weather conditions will be in focus. RIO ahead of the result is off slightly while its rival in the iron ore space BHP Billiton Limited (BHP) gained 0.2%.

One sector of the market that is usually very quiet is seeing a lot of action today the S&P/ASX 200 Utilities sector off 0.9%. This morning, The Labor party announced plans to scrap the carbon tax and move to an emissions trading scheme. They said this will cost $3.8Billion over the next 4 years. This will lead to reductions and changes to funding for clean technologies and carbon capture. Today AGL (AGK) shares off slightly on strong volume as investors weigh up the cost of these changes if they occur. APA Group (APA), the owners of the Australian Pipeline Trust and APT Investment, today announced it had proposed a merger with Envestra (ENV) (APA currently owns 33%of ENV) for $1.98Billion. Envestra lifted on the news up 4.25% while APA came off 2.98% to $6.19.

Elsewhere, Telstra (TLS) shares slightly higher up 0.4% to $4.85, while Treasury Wine Estates Limited (TWE) continued to fall down 8% after it fell 12% yesterday.

The Australian dollar higher ahead of RIOs result now up 0.68% to 0.916USC.

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