Australian Stock Market Report – Midday 7/30/13

MID-SESSION REPORT
(12pm AEST)

The Australian share market is lower at lunchtime in the East, as investors show caution ahead of a speech by RBA Governor Glenn Stevens.

Caution ahead of the US two day FOMC meeting also saw investors pull out of equities on US markets overnight, although European markets were firmer on so-called "Merger Monday" takeover and acquisition activity.

Locally, financial stocks are coming back from yesterday's gains. Shares in the Commonwealth Bank (CBA) reached a record high yesterday but are down 0.4 per cent to $73.54 at lunchtime in the East.

Retailer Woolworths (WOW) is weaker by two per cent at lunchtime in the East, as investors respond to its fourth quarter sales. Sales for the year rose 4.3 per cent to $59.16 billion despite weak consumer confidence and low inflation. 4Q sales were up 8.9 per cent to $14 billion while WOW said 4Q deflation rose by 3.5 per cent. CBA retail analyst Andrew McLennan believes the weakness in WOW's share price today is a reaction to softer than expected Big W sales, with WOW's food and liquor sales coming in as expected.

In economic news, building approvals fell 6.9 per cent in June, down 13 per cent on a year ago. Weakness was driven by private apartment approvals which were down 12.6 per cent in June.

So far on the market, a total of 661 million shares have changed hands, worth $1.9 billion. 344 are up, 354 are down and 282 are unchanged.

The Australian dollar is holding steady at US92c after falling below the US92c level during New York trade.

Governor Glenn Stevens speaks at the Anika Foundation in Sydney at 1pm AEST.

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