Australian Stock Market Report –Midday July 25, 2014

Asian stock market — Pedestrians look at an electronic board showing the stock market indices of various countries outside a brokerage in Tokyo June 25, 2014. Asian shares were on the back foot early on Wednesday, taking their cue from Wall Street as the deepening crisis in Iraq and a report that the U.S. could be loosening restrictions on crude exports triggered a rally in oil prices. REUTERS/Yuya Shino (JAPAN - Tags: BUSINESS)

Local shares down for first time this week

 The Australian sharemarket is falling for the first time in eight trading days, with the All Ordinaries Index (XAO) down 0.3 per cent. The falls are still only modest due to a lack of major drivers overnight. Shares in the U.S. finished largely flat despite the S&P500 continuing to hit fresh record highs on a daily basis. Some positive signs for US employment were offset by disappointing profit results.

 As expected, the International Monetary Fund (IMF) downgraded its growth forecasts for the global economy to 3.4 per cent. Importantly for Australia, it has also cut growth estimates for Chinese to 7.4 per cent.

 The financials and property trusts are standouts at lunch. Three of the major banks are up slightly while the insurance sub-sector is a standout. Insurance Australia Group (IAG), the owner of NRMA said yesterday that fewer costs associated with natural disasters over the past year are helping margins. QBE Insurance (QBE) is up 1.28 per cent, IAG is 1.2 per cent firmer and Suncorp (SUN) is up 1.1 per cent.

 The miners are losing ground following weaker iron ore, oil and gold prices overnight. The world's largest miner BHP Billiton (BHP) is down 0.3 per cent; however has had a solid week after announcing a 20 per cent rise in its iron ore production over the past year.

 Gold producer Newcrest Mining (NCM) is adding to yesterday's 6 per cent slump with a 2 per cent slide in its share price today. On Thursday, the country's largest gold miner warned that a write-down as much as $2.5 billion is a possibility due to tough conditions. The smaller Kingsgate

(KCN) is up 2.8 per cent after announcing a 17 per cent rise in quarterly production today.

 The retailers are mixed, with Country Road (CTY) not trading after the Australian Foreign Investment Review Board approved South African retailer Woolworths' bid for the clothing retailer. CTY has surged by 290 per cent since January this year. GUD holdings (GUD) is down 8.7 percent after the company behind brands like Sunbeam delivered a 44 per cent slump in net profit for the year to $17.7 million.

 At midday, 1.15 billion shares have been traded, worth $3.66 billion. 374 stocks are higher, 443 are in the red and 345 are unchanged.

 The Australian dollar is weaker, buying US94.1 cents following a rise in the U.S. dollar thanks to positive signs for U.S. employment overnight.