Australian Stock Market Report – Midday December 17, 2014

Today's Ordinaries Index curve is seen at the Australian Securities Exchange (ASX) in central Sydney August 23, 2010. Australian financial markets bet on Monday that inconclusive weekend elections would deliver a change of government, ushering in a new minority conservative administration that would scrap a planned mining tax. REUTERS/Daniel Munoz (AUSTRALIA - Tags: BUSINESS ELECTIONS POLITICS)

 Buyers have made a rare impression on the ASX 200 in early trade on Wednesday. After 6 consecutive sessions of losses the share market has spent the morning in positive territory, having opened with a small loss of 2 points, before moving on to a gain of 33 points at session highs. As lunchtime approached the ASX 200 was ahead by 32 points.

 The positive impulse locally came despite the weaker results for US share markets overnight. A mild rebound in oil prices supported the energy sector on Wall St. The S&P energy sector outperformed rising by 2.4%. Investors also bet on a more cautious tone from the US Federal Reserve ahead of the FOMC rates decision which is released tomorrow. The Dow Jones closed down by 110 points or 0.6%. The S&P 500 index was down by 0.8% and the Nasdaq lost 57 points or 1.2%. European shares staged a late rebound on Tuesday as the Russian rouble recovered against the US dollar and oil prices also bounced of 5½ year lows. The FTSEurofirst 300 index rose by 1.9%, the German Dax also gained 1.9%, while the UK FTSE rose by 2.4%.

 Most sectors measured by the ASX were ahead at the conclusion of morning trade. The rebound in oil prices in the last 12 hours meant that energy stocks were the best improved group. The materials sector was amongst the best improved on the day even though base metal prices were weaker on the London Metal Exchange overnight. The contraction in Chinese factory activity in the last day has been the main outcome to weigh on prices . Nickel lost 2.7% while lead gave back 2.5%. Other metals fell between 0.6%-1.9%. Gold fell with Comex gold futures down by US$13.40 an ounce or 1.1% to US$1,194.30 per ounce. Iron ore fell by US50c to US$68.10 a tonne. Rio Tinto shares were up by76 cents or $27 at $53.45 , BHP Billiton was ahead by 27 cents or 1% at $27.70. In the energy sector Woodside Petroleum (WPL) was at $35.82 a gain of $1.36 or almost 4%.

 In other news IT services provider DWS Limited (DWS) said that the group's first half EBITDA will include a one-off, extraordinary write-down in connection with its investment in the joint venture entity with Borealis, a Canadian based software company. Borealis has been unable to pay amounts owed to the JV entity. Borealis is subject to official insolvency protection in Canada. The JV entity will apply to wind-up the Australian subsidiary of Borealis and will work with the liquidator in an attempt to recover monies owed. The first half EBITDA range is now expected to be in the range of $7.0M to $7.5M (prior comparative period $9.47M). This compares to the EBITDA range of $7.75M to $8.5M provided at the DWS AGM. AS a result DWS shares were down 10 cents or 9.6% at 94 cents.

 Leighton Holding's (LEI) shares were placed in a trading halt as the market speculated on suggestions that the group is about to sell its services business for up to $1 billion. Leighton shares will remain in a trading halt for up to two days following reports that private equity giant Apollo Global Management was poised to buy Leighton Services for $1 billion.

 In Australia, no economic data has been released. Ahead in the US, CPI data and the FOMC rates decision will handed down overnight.

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