Australian Stock Market Report – Midday December 15, 2014

 Due to the events unfolding in Sydney's CBD, there will not be the usual market close written report at 4.30pm AEDT today.

A police officer runs across Martin Place near Lindt Cafe where hostages are being held, in central Sydney December 15, 2014. Dozens of hostages were trapped inside the central Sydney cafe on Monday, with local television showing some being forced to hold up a black flag with white Arabic writing in the window, raising fears of an attack linked to Islamic militants. REUTERS/Jason Reed (AUSTRALIA - Tags: CRIME LAW CIVIL UNREST)

 Australian shares at 2.30pm AEDT are down by 0.6 per cent; adding to last week's 2.2 per cent slump. Although most sectors are losing ground the telcos, IT stocks, utilities and healthcare industries are modestly firmer. Mining companies are faring worst; with BHP Billiton (BHP) down 1 per cent and Rio Tinto (RIO) is down 1.1 per cent.

 The Federal Government's Mid-Year Economic and Fiscal Update has been released with Treasury Joe Hockey current holding a press conference. The Federal Government is projecting a $40.4 billion deficit (2.5 per cent of GDP) for the current financial year. The May budget had tipped a deficit this year of $29.8 billion. A budget surplus is not expected over the forecast period.

 The Australian dollar is sitting at its weakest levels in four and a half years, buying US$0.821, €0.659, ¥97.5 and £0.522.

 Volume is light with two hours of trade remaining. 895.1m shares have been traded worth $2.35bn. 255 stocks are up, 622 are down and 285 stocks are unchanged.

 Tonight manufacturing data will be released in the US, together with industrial production statistics and an update on the housing market. No major data is scheduled for release in Europe.

 The Reserve Bank dominates the economic calendar this week with RBA Board minutes and a number of speeches to focus on. ANZ Banking Group (ANZ) and National Australia Bank (NAB) are both holding their Annual General Meetings later in the week.

 Across the region, 'flash' manufacturing PMIs will be released in Japan and China on Tuesday. These are mid-month updates on the health of both their manufacturing industries. China and Japan are Australia's two most important trading partners.

 A European Summit will be held in Brussels on Thursday and Friday. This is expected to be attended by Heads of State. According to the European Union's website

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