Australian Stock Market Report – Midday 9/13/13

MID-SESSION REPORT
(1pm AEST)

After five consecutive up days, the local sharemarket is giving back some of its improvements. The All Ordinaries Index (XAO) is down 0.4 per cent; however still is still 1.39 per cent firmer over the course of the week. Local stocks are also hovering around five year highs.

The weakness should come as no surprise, with global markets easing overnight. US shares fell for the first time in eight sessions while European markets backed away from multiyear highs. Investors seem somewhat hesitant ahead of the US central bank's two day meeting next week.

Resource stocks have been amongst the biggest beneficiaries from solid Chinese economic news since Sunday. The four day win streak has come to an end today though, with the S&P/ASX 200 Materials index (a measure of mining sector performance) down 1.15 per cent. The world's biggest miner, BHP Billiton (BHP) is down 0.98 per cent while Rio Tinto (RIO) is 1.61 per cent lower. Weaker gold prices are hurting the producers of the precious metals. Newcrest Mining (NCM) is down 2.86 per cent.

Department store owner, Myer (MYR) continues to slump following yesterday's announcement of an 8.7 per cent fall in annual profit. MYR is down 3.79 per cent at lunch. David Jones (DJS), which has around half as many department stores as MYR, is up 1.04 per cent.

The airlines are weaker today, however have been stellar performers since the Federal Election. Expectations that the carbon tax will eventually be repealed (even if a way off) are helping. QAN is down 0.35 per cent and VAH is 0.56 per cent lower today. Over the past five days though, QAN is up around 9.5 per cent while VAH is 6 per cent higher.

No major economic news is issued in Australia or the region today.

Tonight will be one of the busiest sessions of the week on the reporting front in the US. Retail sales, producer prices (business inflation) and consumer sentiment will all be highlights. In Europe, leaders are scheduled to meet and the monthly trade balance numbers will be issued.

At lunch, 851 million shares have changed hands, worth $1.66 billion. 330 stocks are higher, 463 are in the red and 310 are unchanged.

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