Australian Stock Market Report – Midday June 26, 2014

MID-SESSION REPORT
(12.15pm AEST)

The Australian sharemarket is improving for the second time this week, with a positive lead from Wall Street helping lift local stocks. The All Ordinaries Index (XAO) is up 0.8 per cent, creeping back above the key 5400 point mark. The property trusts are the lone losers at lunch, with all other sectors recording at least modest gains.

The mining sector is up 0.8 per cent, following two straight days of weakness within the industry and a slightly firmer iron ore price. Yesterday, the Australian government's commodities forecaster downgraded its forecast for the iron ore price in 2015. Iron ore producer Paladin Energy (PDN) is surging by 8 per cent following some better signs for one of its mines in Canada. PDN shares are still down 35 per cent since the start of this calendar year however. Since Japan's Fukushima Daiichi disaster in March 2011, PDN shares have slumped by 94 per cent. The uranium price has never recovered, as a nuclear energy fell out of favour with many large consumers.

Newly formed Westfield Corp (WFD) and Scentre Group (SCG) are both firmer following the shopping centre owner's restructure yesterday. WFD shares are up 2.6 per cent while SCG is up 1.4 per cent. Property group Lend Lease (LLC) is up 1.8 per cent and announced a development deal in Malaysia worth $2.48 billion. This includes the construction of a hotel, a shopping mall and three residential buildings. The rest of the industry is struggling as many of the sector's largest companies are trading ex-dividend. This includes GPT Group, Stockland, Mirvac, Dexus, CFS Retail Trust and Australand. Purchasing shares in any of these companies today onwards will not make you eligible to receive their next distributions.

At lunch, 897.7 million shares have changed hands worth $1.77 billion. 533 stocks are higher, 288 are in the red and 399 are unchanged.

The Australian dollar buys US94c; a full US25c firmer than a decade ago against the greenback

Tonight, is expected to be quiet on the economic front, with the focus on personal income/spending numbers in the U.S. together with the results of a weekly report measuring the number of Americans filing for unemployment benefits in the previous week.