Australian Stock Market Report – Midday September 10, 2014

Stock market yawning investor — An investor yawns in front of an electronic board showing stock information at a brokerage house in Hangzhou, Zhejiang province June 19, 2014. China shares had their biggest daily losses in more than seven weeks on Thursday, as the diversion of a sizable amount of capital for initial public offerings continued to weigh on markets. REUTERS/Stringer

Yesterday's gains wiped out at lunch

 The US market's worst session in five weeks set local shares up for a tough start this morning. The All Ordinaries Index (XAO) is down 0.7 per cent, completely wiping out Tuesday's 0.5 per cent gains and pushing the index back below the key 5600pt level. US and European markets fell by around 0.5 per cent overnight; however the S&P500 is still outperforming the Australian market by 3.5 per cent this calendar year.

 One of the world's largest companies, Apple (AAPL;us) unveiled three new products at a launch last night. The release pushed its shares up more than 4 per cent at one point with the excitement dying off by the close. The introduction of an Apple Watch is a sign that innovation is back. Interestingly if Apple was listed on the

Australian market it would make up 36 per cent of the market on its own and is five times larger than CBA!

 All sectors are losing ground at lunch. The single biggest drag on trade is supermarket chain Woolworths (WOW) which is down 2.3 per cent and is ex-dividend today. Other notable big names trading ex-dividend are Brambles (BXB), Scentre Group (SCG), Atlas Iron (AGO) and Arrium (ARI).

 After a strong rise yesterday for the mining sector, another fall in the iron ore price is keeping the industry in the red. BHP Billiton (BHP) is down 1 per cent, Rio Tinto (RIO) is 0.6 per cent softer and Fortescue Metals (FMG) is slumping by 2 per cent.

 The financials are down 0.5 per cent with Westpac (WBC) the only big name to have crept into positive territory.

 Telstra (TLS) is down 1.1 per cent; moving away from the highs hit pre ex-dividend a fortnight ago.

 Most markets in the region are resuming normal trade today after a holiday interrupted start to the week. Shares in Hong Kong are down 1.5 per cent after a holiday on Tuesday. China's Shanghai Composite is down 0.7 per cent and Japan's Nikkei is slipping by close to 0.5 per cent. Markets in South Korea are closed for thethird day due to the Chuseok holiday.

 At lunch, 870.1m shares have been traded worth $1.87bn. 289 stocks are up, 527 are down and 299 are unchanged.

 On the economic front a monthly report on consumer confidence was released at 11.30am (AEST) and initially pushed the Australian dollar lower. Consumer sentiment slumped by 4.6 per cent this month after three months of improvement. Note that yesterday's weekly report on confidence is a more pertinent read

as the monthly data is based on surveys conducted in the first week of September rather than on a weekly basis. Yesterday's numbers showed that confidence levels came back last week.

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