Australian Stock Market Report – Midday 8/12/13

MID-SESSION REPORT
(12.30pm AEST)

The Australian sharemarket is improving, with the All Ordinaries Index (XAO) up 0.6 per cent. In the first hour of trade, the local market was slipping for the fifth time in six sessions.

The mining sector has been the biggest contributor to the gains, with BHP Billiton (BHP) and Rio Tinto (RIO) trading around five month highs. BHP, the world's biggest mining company is up 2.5 per cent, while RIO is 2.6 per cent higher.

The company profit reporting season picks up another notch this week. This morning, we've heard from the likes of Newcrest Mining (NCM), GPT Group (GPT) and discount retailer JB Hi-Fi (JBH).

NCM produced a statutory loss of $5.78 billion for 12 months ended 30 June. A 21 per cent slide in gold prices YTD has been squeezing margins. Investors have been shrugging off the loss though, with NCM up 4.9 per cent.

A-REIT (Australian Real Estate Investment Trust), GPT Group (GPT) issued a 6.7 per cent fall in Net Profit to $257m between January and June. GPT partly blamed the lower earnings on difficult operating conditions. The Fed's expected tapering of QE has pushed yields higher by 1 per cent over the past 12 months, making the A-REITS less attractive investments. The weakness of our dollar has also spooked some foreign investors. GPT shares are up 0.94 per cent regardless.

This week we'll hear from CSL (CSL), Leighton Holdings (LEI), Computershare (CPU), AMP Limited (AMP), Wesfarmers (WES) and Santos (STO).

On the economic front, the most comprehensive reading on lending across the Australian economy was issued today. Lending finance rose for a fifth straight month, with total lending up 6.9 per cent in June. The national average price of unleaded petrol fell by 2.3 cents per litre to 151.2c/l last week. CommSec expects fuel prices to fall by a further 2-3 cents over the next few weeks.

At lunch, 840.8 million shares have changed hands, worth $1.84 billion. 463 stocks are higher, 288 are in the red and 242 are unchanged.

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